[Senate Report 107-117]
[From the U.S. Government Publishing Office]
Calendar No. 237
107th Congress Report
SENATE
1st Session 107-117
_______________________________________________________________________
AGRICULTURE, CONSERVATION, AND RURAL ENHANCEMENT ACT OF 2001
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R E P O R T
of the
COMMITTEE ON AGRICULTURE, NUTRITION, AND FORESTRY
U.S. SENATE
to accompany
S. 1731
December 7, 2001.--Ordered to be printed
__________
U.S. GOVERNMENT PRINTING OFFICE
76-567 WASHINGTON : 2001
Calendar No. 237
107th Congress Report
SENATE
1st Session 107-117
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AGRICULTURE, CONSERVATION, AND RURAL ENHANCEMENT ACT OF 2001
_______
December 7, 2001.--Ordered to be reported
_______
Mr. Harkin, from the Committee on Agriculture, Nutrition, and Forestry,
submitted the following
R E P O R T
[To accompany S. 1731]
The Committee on Agriculture, Nutrition, and Forestry,
reports an original bill (S. 1731) to strengthen the safety net
for agricultural producers, to enhance resource conservation
and rural development, to provide for farm credit, agricultural
research, nutrition, and related programs, to ensure consumers
abundant food and fiber, and for other purposes, and having
considered the same and recommends that the bill do pass.
CONTENTS
Page
I. Introduction.....................................................1
II. Summary..........................................................4
III. Purpose, need, and background...................................29
IV. Section-by-section analysis.....................................95
V. Legislative history and votes in the Committee.................219
VI. Regulatory impact statement....................................234
VII. Budgetary impact of the bill...................................236
VIII.Changes in existing law........................................258
I. Introduction
The Agriculture, Conservation and Rural Enhancement (ACRE)
Act of 2001, is a comprehensive and balanced farm bill. This
legislation is, of course, critically important to farm and
ranch families, but also to the well-being of all Americans,
whether they live in rural or urban areas. Within the funding
provided by the budget resolution, the Committee has sought to
ensure a safe, abundant and affordable food and fiber supply
for the people of the United States and other nations, while
promoting fair returns and opportunities for agricultural
producers and the conservation of natural resources. The bill
is also designed to promote new and expanded markets at home
and abroad for U.S. agricultural products while complying with
international trade agreements. The legislation reflects a deep
appreciation of the value of farms, ranches and rural
communities--and the critical need to promote their survival
and prosperity. It will help rural communities and their
citizens share in the economic growth, job creation and
prosperity that the nation, in general, has enjoyed over the
years.
Overview
The bill will assist the nation's farmers and ranchers,
many of whom are in economic distress, meet their need for
income protection by providing a new and improved safety net.
The safety net provided by the bill consists of four separate
elements, including marketing assistance loans (and loan
deficiency payments), direct fixed payments, counter-cyclical
payments, and a new conservation payment program for working
farms and ranches. The Committee recognizes the need to protect
and enhance the long-term health and vitality of agricultural
lands and thus the bill improves and significantly increases
funding for the existing USDA conservation programs and creates
new ones. The legislation also expands support to farm-based
renewable energy and promotes new economic opportunities and
improved quality of life in rural communities. In addition, the
Committee increases nutrition assistance for Americans and in
developing countries and strengthens agricultural trade, farm
credit, research and forestry programs.
Farm income protection
This legislation responds to the need heard by the
Committee to revise and extend the farm bill nearly a full year
before the current authorization expires. It is widely
recognized that the current program is not providing the type
of flexible and market-responsive income protection that is
needed by farmers and ranchers in the current economic
environment. When the existing farm legislation, the Federal
Agriculture Improvement and Reform (FAIR) Act, was considered
and enacted in 1996, the U.S. farm sector enjoyed high prices
and a robust expansion of exports. With commodity prices at
record high levels in 1995-96 and projected to remain high,
many did not expect the marketing assistance loan program and
the related loan deficiency payments to trigger significant
outlays. Unfortunately, this prediction proved wrong. With
falling exports due to the financial crisis in Asia in late
1997, and a series of good growing seasons in major producing
regions without significant weather disruptions, commodity
prices fell by 50 percent or more from their 1996 peaks. Less
than two years after enactment of the FAIR Act, the dramatic
decline in commodity prices created serious cash flow problems
for farmers and producer incomes fell sharply.
The income protection features of the farm program were
limited by the provisions of the FAIR Act that provided farmers
with fixed and declining ``transitional'' payments during this
period. The objective of these transitional payments, which
replaced production-based deficiency payments, is now a subject
of considerable debate. Some argue the declining fixed payments
were intended to be a transition to less government support for
farmers. Others maintain that the fixed payment approach is an
appropriate farm policy tool for delivering farm income
assistance into the future. On the other hand, there seems to
be near universal agreement that the planting flexibility
provisions of the FAIR Act were well received by farmers. That
policy has given farmers greater choice and freedom in making
planting and other decisions on the farm.
The combination of lower prices and lower Federal support
payments for farmers in the late 1990's created significant
problems for farmers all across the country. Congress responded
by providing emergency supplemental farm assistance totaling
more than $30 billion over four consecutive years. While these
payments helped alleviate farmers' cash flow problems, the
payments did not address whether the underlying agriculture
policies were performing adequately. Today, the farm income
data shows that the economic situation in the farm sector has
only improved slightly since the late 1990's. Commodity prices
remain quite low and national farm policy must be amended to
address the need for a more market-sensitive, counter-cyclical
approach that will respond adequately to periods of low prices.
Conservation of natural resources
To preserve the health and productivity of agricultural
lands, the new bill also makes very substantial new investments
in conservation. This investment recognizes that while
agriculture is primarily about the production of food and
fiber, there is a strong link between a productive agriculture
and the conservation of soils, the abundance of wildlife and
the quality of water supplies. America's farmers and ranchers
play a critical role as stewards of natural resources for
future generations. While most farmers do maintain practices to
enhance natural resources on and off their farms, periods of
low prices and high costs too often make it difficult for
farmers to spend time and resources on conservation practices.
Resources are needed to help farmers and ranchers maintain and
adopt needed conservation practices on land in agricultural
production.
USDA programs have helped farmers make great strides in
working toward land stewardship goals. The Conservation Reserve
Program protects some 34 million acres of the nation's land,
including an increasing acreage in conservation buffers,
waterways, and filter strips. The Wetlands Reserve Program has
supported the restoration of over a million acres of wetlands,
which provide critical wildlife habitat and improve water
quality. The Farmland Protection Program has helped ease
development pressures on agricultural land. However, USDA's
critical conservation programs are oversubscribed and
underfunded. This bill responds to this need. The bill also
recognizes that conservation must mean something more than land
retirement. There is a link between conservation and a
profitable agriculture. A whollyvoluntary new program is
established, the Conservation Security Program, which will provide
payments to farmers who practice sound conservation on working
farmland, and funding is dramatically increased for the Environmental
Quality Incentives Program. The legislation also includes new programs
and enhanced funding for conserving and improving private forest lands.
Rural community development
The Committee is also well aware that rural America
involves much in addition to agricultural production. Only six
percent of rural Americans live on farms, and less than two
percent of the U.S. rural population is engaged in farming as a
primary occupation. Fewer than one in four farm families
receive the majority of their income from farming, and so are
dependent upon the rural economies around their farms. Seven
out of eight rural counties are dominated by varying mixes of
manufacturing, services and other non-farming activities. While
rural development has traditionally focused much attention on
providing physical infrastructure to rural areas, this bill, in
addition to supporting infrastructure, includes a number of
innovative and creative new approaches to rural revitalization.
For instance, the bill authorizes the National Rural
Cooperative and Business Equity Fund to spur rural economic
growth by generating the investment capital critical to rural
business development.
Farm-based renewable energy
While U.S. agriculture has been a long-time world leader in
food and fiber production, the Committee recognizes that
American farms can also generate abundant renewable energy.
Indeed, much of the nation's renewable energy potential is
found on agricultural lands and in rural areas. Ethanol,
biodiesel, wind, biomass and hydrogen energy could become a
major cash crop for farmers and ranchers, helping to increase
and diversify income, and counteract swings in commodity
prices. Ethanol and biodiesel hold great potential for
increased farm commodity and by-products demand. According to
the Department of Energy, tripling the use of biomass energy,
such as fast-growing energy crops like switchgrass, could
provide as much as $20 billion in new income for farmers and
rural communities. Increasing the diversity and supply of
renewable energy and improving energy efficiency will reduce
the nation's dependence on imported oil, thereby reducing its
vulnerability to supply and price disruptions and adding to
overall national security. Accordingly, the Committee has
provided a major new boost to farm-based renewable energy
development and production.
In sum, the Committee has developed a comprehensive new
farm bill responding to the broad and numerous challenges in
food, agriculture, conservation and rural policy. It is
designed to protect farm income while laying a foundation for
future opportunities for America's farm families, rural
communities and consumers.
II. Summary
TITLE I--COMMODITY PROGRAMS
Subtitle A--Direct and Counter-Cyclical Payments
The bill authorizes the Secretary to enter into contracts
with producers of wheat, corn, grain sorghum, barley, oats,
upland cotton, rice, soybeans and minor oilseeds that will
entitle the producers to receive both direct payments and
counter-cyclical payments on eligible cropland for the 2002
through 2006 crop years. Producers will have the option of
updating acres and payment yields for all covered commodities
on the farm or retaining existing base acres and program yields
and adding oilseeds acres using the recent oilseed yield
experience.
Contract Acreage Calculation
(A) the four-year average (1998, 1999, 2000, 2001) of
acreage actually planted on the farm to a covered commodity for
harvest, grazing, haying, silage, or other similar purposes
during the base period and any acreage on the farm that the
producers were prevented from planting during such crop years
to the covered commodity because of drought, flood, or other
natural disaster; or (B) the current contract acreage plus the
four-year average of oilseeds acreage to a maximum of 100
percent of actual cropland on the farm.
Payment Yield
(A) the greater of: (1) the average of the yield per
harvested acre for the crop of the covered commodity for the
farm for the 1998 through 2001 crop years excluding: (a) any
crop year for which the producers on the farm did not plant the
covered commodity; and (b) at the option of the producers on
the farm, one additional crop year; or (2) the existing program
payment yield; or (B) existing program payment yield.
Producers electing to retain current contract acreage will
also retain current program payment yields, but will use recent
production experience to determine any oilseeds payment yields.
The election will apply to all crops on the farm.
Direct Payments
For each contract commodity, producers will receive direct
payments equal to the product of the contract acres times the
payment yield times the direct payment rate for the current
fiscal year, as specified below. Direct payments shall be paid
not later than September 30 of each of the fiscal years 2002
through 2006. At the option of the producer, 50 percent of the
direct payment will be paid on or after December 1 of the
fiscal year.
----------------------------------------------------------------------------------------------------------------
Income Direct payment rate--
Unit protection Loan rate -------------------------------------
price 2002/2003 2004/2005 2006
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Wheat.............................. bu $3.45 $3.00 $0.450 $0.225 $0.113
Corn............................... bu 2.35 2.08 0.270 0.135 0.068
Grain sorghum...................... bu 2.35 2.08 0.31/0.27 0.135 0.068
Barley............................. bu 2.20 2.00 0.200 0.100 0.050
Oats............................... bu 1.55 1.50 0.050 0.025 0.013
Upland cotton...................... lb 0.68 0.55 0.13 0.065 0.0325
Rice............................... cwt 9.30 6.85 2.45 1.225 0.6125
Soybeans........................... bu 5.75 5.20 0.550 0.275 0.138
Minor oilseeds..................... lb 0.105 0.095 0.010 0.005 0.0025
----------------------------------------------------------------------------------------------------------------
Counter-Cyclical Payments
The payment rate for counter-cyclical payments equals the
difference between the income protection price and the sum of
the direct payment rate plus the higher of the 5-month average
price or the loan rate for the crop. For the 2002 and 2003 crop
years, the higher direct payments will preclude any counter-
cyclical payments. Producers receive counter-cyclical payments
equal to the product of the contract acres times the payment
yield times the counter-cyclical payment rate. The counter-
cyclical payment is made after the 5-month price is
established, but no later than 190 days after the beginning of
the marketing year.
Contract Requirements
Producers must meet conservation compliance, wetland
protection, flexibility restrictions and required agricultural
use.
Flexibility
Producers may plant any commodity or crop except fruits,
vegetables (other than lentils, mung beans, dry peas and
chickpeas), and wild rice. The bill establishes a penalty for
first time violations of planting flexibility restrictions
equal to twice the amount otherwise payable under the contract
for the applicable crop year on each acre that is inadvertently
planted to a restricted crop.
Subtitle B--Loan and Loan Deficiency Payments
For each of the 2002 through 2006 crops the Secretary shall
make available nonrecourse marketing assistance loans for
producers of wheat, corn, grain sorghum, barley, oats, upland
cotton, extra long staple cotton, rice, soybeans, minor
oilseeds, wool, mohair, honey, dry peas, lentils, and chickpeas
who comply with applicable conservation requirements and
wetland protection.
Loan rates for marketing assistance loans:
Wheat--$3.00 per bushel
Corn--$2.08 per bushel
Grain sorghum--$2.08 per bushel
Barley--$2.00 per bushel
Oats--$1.50 per bushel
Upland cotton--$0.55 per pound
Extra long staple cotton--$0.7965 per pound
Rice--$6.85 per hundredweight
Soybeans--$5.20 per bushel
Minor oilseeds--$0.095 per pound
Graded wool--$1.00 per pound
Nongraded wool--$0.40 per pound
Mohair--$2.00 per pound
Honey--$0.60 per pound
Dry peas--$6.78 per hundredweight
Lentils $12.79 per hundredweight
Large chickpeas $17.44 per hundredweight
Small chickpeas--$8.10 per hundredweight
Adjustments of Loans
The Secretary may make appropriate adjustments in the loan
rates for any commodity for differences in grade, type,
quality, location, and other factors.
Term of Loans
In the case of each loan commodity, a marketing assistance
loan shall have a term of nine months beginning on the first
day of the first month after the month in which the loan is
made.
Repayment Rate for Loans
(1) The local loan rate for the commodity plus interest; or
(2) (a) for wheat, feed grains, oilseeds, wool, mohair, honey
and pulses--a rate determined by the Secretary that will
minimize potential loan forfeitures; minimize the accumulation
of stocks of the commodity by the Federal Government; minimize
the cost incurred by the Federal Government in storing the
commodity; allow the commodity produced in the United States to
be marketed freely and competitively, both domestically and
internationally; and minimize discrepancies in marketing
assistance loan benefits across county and State boundaries;
(b) for rice and upland cotton--the prevailing world market
price for the commodity (adjusted to United States quality and
location), as determined by the Secretary.
Loan deficiency payments
The Secretary may make loan deficiency payments available
to producers of all loan commodities except extra long staple
cotton. The loan deficiency payment rate will equal the
difference between the loan rate and the loan repayment
rate.Special marketing loan provisions for upland cotton and the
special competitive provisions for extra long staple cotton are
continued.
Recourse loans for high moisture feed grains and seed
cotton are continued.
Subtitle C--Other Commodities
CHAPTER 1--DAIRY
Extends the milk price support program at $9.90 per
hundredweight through 2006.
Establishes a national dairy policy that provides a
counter-cyclical income support program for dairy farmers
across the country. Its purpose is to stabilize the production,
price, and marketing of milk and other dairy products in the
United States.
The Secretary is required to amend Federal milk marketing
orders to establish a minimum price for Class I, or fluid milk
that is not less than the sum of the adjusted Class I milk
differential and at least $14.25 per hundredweight.
The Secretary must provide for uniform national pooling of
Class I milk among producers of milk under all Federal milk
marketing orders of all funds equal to the difference between
the price of Class I milk and the price of Class I milk without
the national dairy program. After first paying administrative
costs, any increased costs of State and Federal nutrition
programs, and additional Commodity Credit Corporation (CCC)
expense, the Secretary must distribute amounts in the national
pool to all producers covered by Federal milk marketing orders,
based on eligible production of up to 500,000 pounds per month.
During each month when the average Class III price falls
below $14.25 per hundredweight, the Secretary shall use funds
of the CCC to make a payment to each producer for eligible
production of Class II, III and IV milk. The payment rate
equals 25 percent of the difference between $14.25 per
hundredweight and the average price for Class III milk during
the month. Total payments under this provision are limited to
$300,000,000 per fiscal year.
CHAPTER 2--SUGAR
Reauthorizes the sugar program with amendments to require
the Secretary to implement the program, to the greatest extent
possible, at no net cost. Terminates the marketing assessment
on sugar and eliminates the loan forfeiture penalty. Authorizes
payment-in-kind to processors in exchange for reduced
production. Authorizes the Secretary to establish allotments on
domestic sugar production. Reduces the CCC interest rate on
price support loans.
CHAPTER 3--PEANUTS
Reforms the quota-based peanut program by establishing a
new peanut program that establishes payment acres for
historical peanut producers, payment yields, and marketing
assistance loans and loan deficiency payments. Provides direct
payments of $0.018 per pound. Establishes an income protection
price for peanuts of $520 per ton (on 85 percent of base acres)
and a loan rate of $400 per ton. Terminates the marketing quota
program and compensates quota holders for the loss of the quota
asset value at $.10 per pound per year for five years.
Subtitle D--Administration
Authorizes the Secretary to make adjustments in domestic
support levels to assure compliance with U.S. commitments under
the Uruguay Round Agreement.
Suspends permanent price support authority.
Requires the Secretary to purchase $130 million of
commodities in fiscal years 2002 and 2003, $150 million in
fiscal year 2004, $170 million in fiscal year 2005, and $200
million in fiscal year 2006. Specifies the amount that must be
used to purchase specialty crops each year, that not less than
$50 million must be used to supplement funds already provided
by USDA to the Department of Defense for the purchase of fresh
fruits and vegetables for the National School Lunch Program,
and that not less than $40 million of commodities are to be
provided to The Emergency Food Assistance Program.
Designates $40 million of CCC funds to provide an incentive
payment for production of Hard White Wheat (HWW). The incentive
will assure sufficient production of HWW to enable the United
States to establish domestic and overseas markets for this
specialty wheat.
Establishes payment limitations for direct and counter-
cyclical payments of not more than $100,000 per year and for
marketing loan gains and loan deficiency payments of $150,000
per year.
TITLE II--CONSERVATION
Conservation Security Program
This legislation establishes a conservation incentive
program that provides payments to producers who adopt or
maintain conservation practices on lands in production. The
practices are aimed at improving and protecting natural
resources, including soil, water, air and wildlife habitat.
Additional goals include sound management of invasive species,
enhancement of carbon sequestration, and wetland enhancement or
restoration.
The program is open to all agricultural producers,
including producers of livestock, speciality crops and program
crops, and of private agricultural lands. Producers are
encouraged to adopt comprehensive conservation plans, but have
the flexibility to choose which practices to adopt or maintain.
In addition, local and State groups provide guidance on
implementation of the program, including establishing local
conservation priorities.
Producers work with the Natural Resource Conservation
Service (NRCS), or eligible third party providers, to create
and implement conservation security plans that outline the
practices,including the schedule of implementation, the
producer agrees to maintain or implement. The program establishes three
tiers of participation in the program. Tier I covers the basic level of
practices, including nutrient, pest, and air quality management, water
conservation and wildlife habitat management that may apply to all or
part of an operation. Tier II includes practices focusing on systems-
based approaches to land management, including partial field practices,
wetlands, grass and prairie restoration and protection. Tier II
practices must cumulatively address at least one local resource of
concern across the entire operation. To qualify for Tier III a producer
must adopt practices that address all resources of concern on the
entire operation. Tier I contracts last five years and Tier II and III
contracts last from five to ten years, at the option of the producer.
Annual payment levels may reach $20,000 for Tier I, $35,000
for Tier II, and $50,000 for Tier III. Payments are based on a
combination of factors, including a percentage of average
county rental rate or appropriate rate to ensure regional
equity (6 percent for Tier I, 11 percent for Tier II or 20
percent for Tier III), bonus payments for increased
environmental benefits and the cost of practices. Bonus
payments may also be provided for beginning farmers and
ranchers, for participation in research or demonstration
projects or pilot programs, and for cumulative participation on
a watershed basis. The producer receives 100 percent of the
costs of adopting or maintaining management practices, 100
percent of the costs of maintaining land-based structural
practices and 75 percent of the costs of adopting new land-
based structural practices. Payments are not provided for the
cost of purchasing equipment or for waste storage or treatment
facilities. An advance payment of the greater of $1,000 or 20%
under Tier I, $2,000 or 20% under Tier II, or $3,000 or 20%
under Tier III.
The Secretary may allow one State to run the Conservation
Security Program in that State.
USDA shall begin working on implementation of the
Conservation Security Program immediately, but contracts will
not be entered until fiscal year 2003.
Partnerships and cooperation
The legislation allows USDA to designate special projects
under all conservation programs to address local needs. The
Secretary may provide incentives to producers to encourage
participation in established special projects.
Administrative requirements for conservation programs
The legislation requires USDA to provide relief, including
retention of payments, continued participation in programs and
other relief to producers who in good faith entered contracts
with the USDA under a conservation program under this title and
were misled by USDA employees. The legislation allows operators
and owners to request mediation services or informal hearings
in the case of adverse decisions relating to an agriculture
conservation program.
The legislation requires USDA to coordinate administration
of the conservation programs to carry out education, outreach,
monitoring and evaluation under all conservation programs,
including for socially disadvantaged and limited resource
owners and operators. The legislation further requires USDA to
ensure that conservation programs are fully accessible to
limited resource producers, beginning farmers and ranchers, and
Indian tribes.
In order to expand implementation of conservation programs,
the legislation requires USDA to establish a criteria for third
party certification and allows USDA to contract with eligible
third parties to provide education, outreach, monitoring,
evaluation and technical assistance.
The legislation prohibits USDA (and other Federal agencies)
from releasing information gathered from producers through
participation in conservation programs, including information
from conservation plans, unless the information is provided in
an aggregate form that does not provide information specific to
individual producers.
Reform and assessment of conservation programs
The legislation requires USDA to provide Congress with a
plan for coordinating conservation programs for better
implementation and for delivering conservation programs for
Indian tribes, including plans to coordinate with the Secretary
of the Interior. USDA must also prepare a plan and budget for
implementing the appraisal of soil, water and related resources
contained in the National Conservation Program.
Comprehensive Conservation Enhancement Program
The legislation reauthorizes and renames (formerly ECARP)
an umbrella program that covers the Conservation Reserve
Program, the Wetlands Reserve Program, and the Environmental
Quality Incentives Program through fiscal year 2006.
Conservation Reserve Program (CRP)
The legislation reauthorizes the CRP through fiscal 2006
and increases the acreage limit to 40 million acres from 36.4
million acres. It prohibits enrollment of lands that do not
have a cropping history during the last three of six years and
prohibits landowners with lands enrolled in CRP from breaking
out new highly erodible lands without a cropping history unless
the land is being used as a homestead or a building site at the
time of purchase of the land. The legislation further opens
enrollment of lands without cropping history into both the
Conservation Reserve Enhancement Program and the continuous
enrollment CRP and requires USDA to provide equal incentive
payments for all continuous practices.
The legislation allows producers to enroll full parcels
through the continuous CRP as buffers in cases in which more
than 50 percent of the parcel is eligible for enrollment. The
legislation also allows USDA to extend hardwood tree contracts,
permanently authorizes the Wetlands Pilot Program, allows
haying and grazing on continuous CRP enrollment lands for
management purposes, and allows wind turbines on lands enrolled
through the general CRP sign-up.
Technical assistance
The legislation removes restrictions on the funding
provided for technical assistance to carry out conservation
programs (i.e. strikes the Section 11 cap).
Wetlands Reserve Program
The legislation raises the total acreage cap by 1.25
million acres of wetlands in the program and requires USDA to
enroll 250,000 acres annually for fiscal years 2002-2006, to
the maximum extent possible. The legislation further allows
USDA to enroll up to 25,000 acres of the 250,000 acres annually
through the Wetlands Reserve Enhancement Program which enables
the USDA to coordinate with State and local governments and
private organizations to focus resources on critical
environmental needs.
Environmental Quality Incentives Program (EQIP)
The legislation reauthorizes EQIP through fiscal year 2006
to allow USDA to provide technical assistance, cost-share and
incentive payments to eligible producers. The legislation
allows USDA to dedicate up to five percent of total funds to be
used for special projects in watersheds and other areas of
regional significance, including for water conservation and
irrigation projects to increase water management, nutrient
reduction and wildlife habitat. In addition, USDA may use up to
$100 million annually for conservation innovation grants to
encourage public and private entities to use Federal funds as
leverage for the development of innovative practices.
The legislation reduces the EQIP minimum contract length to
three years, from five years, eliminates the procedure for
producers to bid down payment rates, provides for contract
payments during the first year of the contract, and provides
increased cost-share assistance of 90 percent to limited
resource and beginning producers.
The legislation sets the total amount an individual may
receive under an EQIP contract at $150,000, with an annual
limit of $50,000. The legislation allows not more than one
contract for structural practices involving livestock nutrient
management for a producer during the five-year period of the
farm bill and requires a comprehensive nutrient management
plan.
The legislation provides the following levels of EQIP
funding: for fiscal year 2002: $500 million; for fiscal year
2003: $1.05 billion; for fiscal year 2004: $1.2 billion; for
fiscal year 2005: $1.2 billion; and for fiscal year 2006: $1.25
billion.
Resource Conservation and Development Program (RC&D)
The legislation permanently authorizes the RC&D program and
permits USDA to provide technical and financial assistance
(including loans and grants) for approved RC&D programs.
Wildlife Habitat Incentives Program (WHIP)
The legislation expands WHIP beyond cost-share restoration
projects through a pilot program that allows USDA to use up to
15 percent of the available funds to enroll lands for 15 years
or longer for critical habitat or species. For the remaining
funds, USDA shall ensure that at least 15 percent of the funds
be directed toward restoration of lands important for
threatened and endangered species.
The legislation provides the following levels of funding:
for fiscal year 2002: $50 million; for fiscal year 2003: $100
million; for fiscal year 2004: $100 million; for fiscal year
2005: $125 million and for fiscal year 2006: $125 million.
Watershed risk reduction
The legislation authorizes appropriations for a new program
through fiscal year 2006 for up to $15 million annually that
allows USDA to provide assistance, including the ability to
purchase flood plain easements, in watersheds impaired by
natural occurrences in order to safeguard lives and property.
Great Lakes Basin Program (GLBP) for soil erosion and sediment control
The legislation authorizes the GLBP through fiscal year
2006 for up to $5 million annually. The GLBP allows USDA to
provide grants, technical assistance and education programs to
reduce soil erosion and increase sediment control for the Great
Lakes Basin.
Conservation of Private Grazing Land Initiative (CPGL)
The legislation reauthorizes the CPGL through fiscal year
2006 for appropriations up to $60 million annually.
Farmland Protection Program (FPP)
The legislation expands the FPP to enable State and local
agencies and private non-profit organizations to leverage
federal funds to purchase development rights from owners of
farms and ranches. The legislation also extends FPP to include
farms and ranches with historical and archaeological resources.
Of the available funds, the Secretary may use up to $10
million annually for Farm Viability Grants for participating
farms and ranches to develop business plans. The legislation
provides the following levels of funding: for fiscal year 2002:
$150 million; for fiscal year 2003: $200 million; for fiscal
year 2004: $200 million; for fiscal year 2005: $225 million;
and for fiscal year 2006: $250 million.
Grassland Reserve Program (GRP)
The legislation establishes a new program to purchase 30-
year and permanent easements and for 30 year rental agreements
on up to two million acres of natural grass and shrub lands
indigenous to a locality to limit conversion of grazing lands.
The legislation permits grazing and limited haying and
mowing in a manner consistent with protecting plant and
wildlife. The legislation also requires USDA to provide cost-
share and technical assistance for carrying out practices to
restore grasslands.
State technical committees (STC)
The legislation expands the responsibilities of STCs to
conform with the increased responsibilities created under this
title.
Use of symbols, slogans and logos
The legislation permits the Secretary to allow the use,
license or transfer of symbols, slogans and logos of USDA.
TITLE III--TRADE
Key food aid provisions
The bill requires the Administrator of the U.S. Agency for
International Development (U.S.-AID) and the Secretary of
Agriculture to establish rules allowing streamlined program
applications for programs under their control for experienced
institutional partners. It changes the amount of administrative
expenses that may be compensated for such projects under PL-
480, Title II, from a dollar range to a range of percentages
(between five and ten percent) of the value of commodities
used.
The bill permits proceeds of sales of commodities for food
aid projects under Title II, Food for Progress, and Section
416(b) to be denominated in U.S. dollars.
It modifies mandatory requirements for the administration
and composition of Title II commodities and projects, and
requires the Administrator of U.S.-AID to act on project
proposals within 120 days of submission.
PVO's (private voluntary organizations) will now be able to
convert commodities to cash at prices that are reasonable for
that particular market under all food aid programs.
The Food for Progress program, under which donated
commodities provide for development projects in recipient
countries, is reauthorized and established at a 400,000 tonnage
minimum per year.
The bill also establishes the International Food for
Education and Nutrition program, which began as a pilot in
2000. It is designed to improve the educational opportunities
and nutritional status of children in developing countries. The
program is funded at $200 million a year for five years, as a
function within the Food for Progress statute.
The bill reauthorizes the Farmer-to-Farmer program, which
funds technical exchanges between U.S. farmers and farmers in
developing countries, increasing the share (from 0.4 percent to
0.5 percent) of Title I and Title II funding which can be used
for support of this program.
Key commercial export provisions
The maximum loan term for the Supplier Credit Program is
increased from six months to twelve months, and all other
export credit programs are reauthorized.
Funding is increased for the Market Access Program, ramping
up to $190 million annually. The bill establishes priority for
new program participants and programs in emerging markets for
amounts available above the existing level of $90 million
annually, and creates a quality export initiative program to
identity high-quality U.S. agricultural products.
The bill reauthorizes the Export Enhancement Program, and
defines exchange rate manipulation by competing exporters and
questionable pricing practices by State trading enterprises as
unfair trade practices.
Funding for the Foreign Market Development Cooperator
Program is increased to $42.5 million annually within three
years. The bill establishes priority for new program
participants and programs in emerging markets for amounts
available above $35 million annually.
The bill authorizes development of a ``one-stop-shopping''
Federal website to assist aspiring exporters learn all they
need to know about getting started. Authorization of
appropriations is provided.
A Biotechnology and Agricultural Trade Program is
established in USDA that is designed to assist exporters facing
problems exporting biotech-based products. The program is
funded at $15 million annually for five years.
The bill strikes restrictions on private financing of sales
of food and medicine to Cuba, which were established in the
Agriculture, Rural Development, Food and Drug Administration
and Related Agencies Appropriations Act of 2001. A Sense of
Congress resolution establishes Congressional priorities and
concerns for bilateral and multilateral agricultural trade
negotiations.
Additional reauthorizations
This legislation also reauthorizes the Food Aid
Consultative Group, assistance for stockpiling and distribution
of shelf-stable foods, prepositioning commodities for emergency
distribution, micronutrient fortification of donated
commodities, the Bill Emerson Humanitarian Trust (emergency
food reserve), and the Emerging Markets program.
TITLE IV--NUTRITION
Representing the largest of the Federal nutrition programs,
the Food Stamp Program is the primary focus of the nutrition
title. The program mainly assists children (50 percent), older
Americans (10 percent), and Americans with disabilities (10
percent). Most of the other participants are individuals in
working families. The Food Stamp Program is essential to
transition from welfare to work. However, data show that
reforms to the program are needed. These include simplifying
the program, ensuring a smoother transition from welfare to
work, reforming the quality control system used to evaluate
States' performance, improving outreach efforts to make sure
that people who qualify for the program are able to
participate, and providing benefits for certain individuals
made ineligible by welfare reform. Between 1994-98 the number
of people who were eligible for the program but did not
participate increased by 12percentage points, while the
reliance in emergency feeding sites like soup kitchens and food
pantries increased dramatically.
Program simplification
Some of the provisions designed to simplify the Food Stamp
Program include: allowing the States to conform Food Stamp
income and resource rules with those in Temporary Assistance to
Needy Families (TANF) cash assistance or Medicaid; simplifying
the way in which housing costs are calculated; encouraging the
States to adopt standard deductions, including ones for utility
allowances and for people who live in certain group living
arrangements; amending the procedure for determining earned
income; extending semi-annual reporting to all households, not
just those who have earnings; and better conforming to
recertification rules in Medicaid, Supplemental Security Income
(SSI), and the State Children's Health Insurance Program
(SCHIP) by allowing periodic redetermination.
Welfare to work
Provisions that will help participants more successfully
transition from welfare to work include: an increase in the
standard deduction to adjust for family size to provide
additional benefits and increasing the length of time that a
household can receive transitional benefits when it stops
receiving TANF cash assistance. The bill also prohibits cutting
off electronic benefits for participants, like the elderly, who
tend to be eligible for a small amount of benefits and may want
to save them up for up to six months before using them. It also
allows able-bodied adults without dependents to participate in
the Food Stamp Program for up to six out of 24 months, rather
than the current limit of three out of 36 months, to give them
more time to successfully find employment. However, the bill
also eliminates the provision that 80 percent of all Food Stamp
education and training funds be made available to this
population only. Pilot programs to improve outreach and access
are also included in the bill.
Quality control reform
The quality control system used to assess the States'
performance is revamped to be less punitive. The bill does
institute new sanction procedures and rewards based on low
error rates, compliance with a number of deadlines, and a
State's enrollment of working families. Other provisions in the
Food Stamp subtitle include expanding the definition of
eligible food products to include vitamin-mineral supplements,
eliminating Federal cost-neutrality rules to facilitate use of
Electronic Benefits Transfer (EBT) systems, and several
administrative provisions.
Legal immigrants
The Personal Responsibility and Work Opportunity Act of
1996 eliminated the ability of most legal aliens to participate
in the Food Stamp Program. Over time, a number of bills have
restored some of these benefits to some children, older adults,
and disabled adults who were in the United States prior to
August 22, 1996. This bill concentrates on particularly
vulnerable groups by restoring benefits to all legal alien
children and the disabled. It also removes a seven-year limit
on the ability of refugees and people seeking asylum to
participate in the program. Finally, it reduces, from 40 to 16
quarters, the length of time that individuals must work in this
country before they are eligible to participate in the Food
Stamp Program.
New and reauthorized programs
The title also reauthorizes a number of programs like The
Emergency Food Assistance Program (TEFAP), the Food
Distribution Program on Indian Reservations, the Commodity
Supplemental Food Program, and the Community Food Projects. It
consolidates the American Samoa block grant and the Puerto Rico
Nutrition Assistance Programs and reauthorizes them, and
increases the funding, by $10 million per year, for TEFAP
processing, storage, and distribution costs. A Congressional
Hunger Fellowship is established, a pilot program for providing
schoolchildren with free fruits and vegetables is established.
Funding is provided for a Senior Farmers' Market Program and
for additional commodities for the School Lunch Program.
TITLE V--CREDIT
Funding for loans
The credit title reauthorizes all USDA farm direct and
guaranteed loan programs and increases the loan authorization
levels: $3.75 billion in total for each fiscal year. Of the
$750 million allocated for direct loans, $200 million is for
farm ownership (FO) loans and $550 million is for farm
operating (OL) loans. Of the $3 billion allocated for
guaranteed loans, $1 billion is for FO loans and $2 billion is
for OL loans.
Beginning farmers and ranchers
The legislation focuses on making credit more accessible to
beginning farmers and ranchers. The bill broadens the
eligibility for direct ownership loans to those who have
participated, as opposed to being the sole manager of, the
business operations of a farm operation for at least three
years; provides USDA the authority to refinance ``bridge
loans'' made by a commercial lender to a beginning farmer or
rancher who has been approved for a USDA farm ownership loan
but is awaiting funding; increases the limit on direct farm
ownership debt for a beginning farmer or rancher from $200,000
to $250,000 and indexes the limit to inflation; provides that
as part of the down payment program for beginning farmers and
ranchers, USDA shall finance 40 percent of the loan (current
law is 30 percent) and provides a repayment term of 20 years
(current law is 10 years); directs the USDA to create a pilot
program in which the USDA will guarantee loans made by a
private seller of a farm or ranch to a qualified beginning
farmer on a contract land sale basis; provides that beginning
farmers and ranchers will receive an additional one percent
interest rate subsidy (capped at four percent) over non-
beginning farmers (capped at three percent) who participate in
the interest rate reduction program and increases the maximum
amount of funds for this program to $750 million and provides
that 25 percent of the program's subsidized funds are reserved
for assisting beginning farmers and ranchers until April 1 of
each fiscal year.
Farm lending program improvements
The bill also makes other changes to provisions of the
Consolidated Farm and Rural Development Act to improve the USDA
farm lending programs. The legislation allows the Secretary to
waive term limitations for a farmer or rancher, one time only,
for an additional period of two years; allows the Secretary to
waive the seven-year eligibility limitation on direct operating
loans for Native American farm operations on tribal lands if
she determines thatcommercial credit is not generally available
for such operations; expands USDA's authority to allow the interest
rate on a direct loan that is being rewritten to be the rate in effect
on the date that a borrower applies for loan; reduces paperwork
requirements for many farmers by raising the limit on low documentation
guaranteed loans from $50,000 to $100,000; makes permanent the interest
rate reduction program; provides that USDA work with the State
Conservationists to consider selling or granting easements on land in
USDA inventory for the purpose of farmland preservation; and provides
those who owe recapture amounts on shared appreciation agreements, or
those who have amortized the recapture amounts, the option of providing
farmland protection and conservation use easements on their land in
return for forgiveness of the recapture amount.
Farm Credit System and Federal Agriculture Mortgage Corporation (FAMC)
The bill amends the authorities provided to FAMC and the
Farm Credit System. It increases the number of FAMC Board of
Directors from 15 to 17 and provides that the chairperson of
the board will be elected by the board; provides the Farm
Credit System authority to finance agriculturally-related
equipment and goods overseas irrespective of whether these
goods will be used on farms in the importing country; provides
the Farm Credit System Insurance Corporation the ability to
weigh the diminished risk associated with the certain
guaranteed loans and to adjust premiums charged to the Farm
Credit System accordingly; eliminates certain ``territorial
concurrence'' requirements on Farm Credit System lenders so
that the lenders can participate in syndicated or
``participation'' loans in other Farm Credit System geographic
territories without seeking the permission of the Farm Credit
System lender in that territory.
TITLE VI--RURAL DEVELOPMENT
National Rural Cooperative and Business Equity Fund
To revitalize rural communities and enhance farm incomes by
encouraging sustainable rural business development, this
provision authorizes the National Rural Cooperative and
Business Equity Fund. It authorizes the appropriation of $150
million in funds to be matched by at least an equal amount
contributed by private investors. USDA will guarantee 50
percent of each investment made by a private investor, with a
maximum total guarantee of $300 million in private investments
in the Fund. Debentures issued by the fund and guaranteed by
USDA shall not exceed $500 million. The Fund will make equity
and semi-equity investments in rural businesses. No single
investment shall exceed the greater of $2 million or seven
percent of the Fund. The total investment made in a company may
not exceed 20 percent of the entire equity stake of the company
nor more than half of the private equity stake of the concern.
The Fund shall seek to make equity investments in a variety of
projects with a significant share being smaller enterprises and
cooperative and noncooperative enterprises, but not retail
businesses. The fund will be managed by a 14 member board, with
three of those members determined by USDA and the rest
determined by private investors.
Rural Business Investment Program
This provision permits USDA to make grants, guarantee
debentures and enter into participation agreements with Rural
Business Investment Companies. To be a Rural Business
Investment Company (RBIC), a company must be for-profit, have
an experienced management team, and invest in rural areas. USDA
may guarantee the issuance of debentures for terms up to 15
years for up to 300 percent of the private capital of the
company, increasing the amount of equity that may be invested.
The program provides for the collection of assets in cases
where the Federal Government makes a payment on a debenture. It
provides for grants of up to $1 million to RBICs to provide
technical assistance to enterprises in which the RBICs invest,
and sets the minimum private capital requirements of the RBICs
at $5 million. Generally, $10 million is needed to issue
insured debentures with flexibility by USDA, and 75 percent of
the investments must be made in rural areas. Investment by
banks and Farm Credit System institutions are limited to 5
percent of capital and with certain additional limitations. The
program supports issuance of up to $350 million in debentures
and up to $50 million in grants.
Full funding of pending rural development loan and grant applications
This provision provides full funding to clear the backlog
of pending rural development loan and grant applications.
Pending qualified applications for community facility grants
and direct loans, water and waste disposal grants and direct
loans, rural water and wastewater technical assistance and
training grants, business and industry guaranteed loans,
emergency community water assistance grants, and solid waste
management grants will be eligible for funding under this
provision. Applications in the pre-application phase are not
eligible for funding under this provision. The funds in the
account established under this section will be available only
after funds appropriated in the annual appropriations act for
fiscal 2002 for these loans, loan guarantees and grants have
been exhausted.
Rural Endowment Program
This program provides rural communities with technical and
financial assistance to develop and implement comprehensive
economic development strategies. Initial grants to communities
to develop comprehensive economic development strategies will
not exceed $100,000. Approved entities will then be eligible
for an endowment grant of up to $6 million to implement the
strategy. Each entity's non-Federal share shall be 50 percent
of the amount received in grant funds, except in cases of
small, poor rural areas where USDA determines that a lower non-
Federal share is allowable. This provision makes $82 million in
mandatory funds available to carry out the program during
fiscal years 2002 and 2003, with not more than $5 million to be
obligated for planning grants, not less than $75 million for
endowment grants and not less than $2 million for technical
assistance. Such appropriations as are necessary are authorized
to carry out the program for each of fiscal years 2004 through
2006.
Enhancement of access to broadband service in rural areas
The bill provides $100 million in mandatory dollars a year
for fiscal years 2002 through 2006 for grants and loans at four
percent or market rate interest for broadband access. The
aggregate value of all loans to be provided cannot exceed $2
billion. Funding could be used for construction, improvement,
or acquisition of equipment. The funding would flow through the
Rural Utilities Service. Initial allocations are made to the
States based on the number of cities in a State with
populations under 2500. If the funds are not obligated by April
1, the funds go intothe national pool. The program would be
limited to communities with populations under 20,000. Broadband speed
and other standards are to be reconsidered every three years.
Value-added agricultural product market development grants
The bill provides $75 million a year for fiscal years 2002
through 2006 in mandatory funding to make value-added
agricultural product market development grants, expands the
eligibility for these grants to nonprofit organizations, and
broadens the categories of activities eligible for grants. It
creates a five percent reserve for marketing, packaging or
processing of certified organic agricultural products. Funding
for the Agricultural Marketing Resource Center, created by USDA
as authorized in the original authorization to provide
technical assistance, is also increased.
National Rural Development Partnership
USDA will continue the National Rural Development
Partnership, which is composed of a Coordinating Committee and
State rural development councils. The Coordinating Committee
will lead and coordinate the strategic operation and policies
of the Partnership and will provide annual reports to Congress.
The role of the Federal Government will be that of a partner
and facilitator, with Federal agencies providing technical and
administrative support. Private and nonprofit sector
organizations act as full partners and cooperate with
government in developing innovative approaches to solving
problems in rural development. State rural development councils
shall have a nonpartisan membership that is broad and
representative of the economic, social and political diversity
of the State. The councils shall facilitate collaboration,
enhance effectiveness and delivery of Federal and State
programs in rural areas, monitor policies and programs that
address, or fail to address, rural needs, and facilitate the
development of strategies to reduce or eliminate conflicting or
duplicative administrative or regulatory requirements. State
rural development councils may solicit funds to supplement and
match Federal funds. A State rural development council shall
provide matching funds, or in-kind goods or services, to
support the activities that are not less than 33 percent of the
amount of Federal funds received.
Water or waste disposal grants
This provision increases the authorization for
appropriations for water and waste disposal grants from $590
million to $1.5 billion, and also authorizes up to $30 million
per year to USDA to make grants to qualified private nonprofit
entities to capitalize revolving funds to finance small water
and wastewater projects, including assistance of up to $100,000
per project for pre-development, equipment replacement, small
scale service extension or other small projects.
Rural business opportunity grants
This grant program is extended to 2006.
Rural Water and Wastewater Circuit Rider Program
This provision authorizes $15 million a year for fiscal
years 2003 through 2006 to pay for technical assistance to
local water systems.
Multi-jurisdictional regional planning organizations
The bill authorizes $30 million a year for fiscal years
2003 through 2006 to fund grants of up to $100,000 to multi-
jurisdictional regional planning and development organizations
to pay for costs of providing assistance to local governments
to improve the infrastructure, services, and business
development capabilities of local governments and local
economic development organizations. A local match is required.
Certified nonprofit organizations sharing expertise
The legislation provides for certification by USDA of
nonprofit organizations with experience in providing technical
assistance in one or more rural development fields who desire
to share that expertise. The provision authorizes $20 million a
year for fiscal years 2003 through 2006 for grants to certified
nonprofit organizations to help them provide this technical
assistance. To receive grants, nonprofit organizations must
develop a plan describing how grant funds will be used. USDA
shall make a list of certified organizations available to the
public.
Loan guarantees for certain rural development loans
USDA will be allowed to guarantee community facility and
water and waste facilities loans for projects financed in part
by the issuance of tax-exempt bonds.
Rural Firefighters and Emergency Personnel Grants Program
The bill provides $10 million in fiscal year 2002 and $30
million a year in fiscal years 2003 through 2006 for
firefighter and emergency medical first responder training.
Three areas are covered: firefighting, emergency medical
practices and responding to hazardous materials and bioagents
in rural areas. Not less than 60 percent of the funds may go to
scholarships to provide the training. Up to 40 percent of the
funds may go to fund facility improvements, equipment or
operating costs of State or regional training centers.
Emergency Community Water Assistance Grant Program
The program is extended through 2006.
Water and Waste Facility Grants for Native American Tribes
The bill provides an authorization of $20 million a year
for water and waste facility grants to benefit Native American
tribes.
Water Systems for Rural and Native Villages in Alaska
The bill extends this provision through 2006.
Rural Cooperative Development Grants
The grant program is extended through 2006.
Grants to broadcasting systems
The bill authorizes $5 million a year for fiscal years 2002
through 2006 in appropriated funds for grants to statewide
nonprofit public television broadcasting systems.
Business and Industry direct and guaranteed loans
This provision amends the Consolidated Farm and Rural
Development Act by: allowing the guarantee of loans to farmers,
ranchers or cooperatives for the purpose of buying stock for
the expansion or creation of a cooperative venture that will
process agricultural products; providing direction to USDA in
assessing the appropriateness of loan guarantees; allowing
guaranteed loans to farmers and ranchers to join existing
cooperatives that will sell the agricultural products produced
by these farmers and ranchers; allowing processing contracts
during the initial period after start-up of a new cooperative
while the new processing facility is being completed; allowing
guaranteed loans to cooperatives headquartered in metropolitan
areas, as long as the loans benefit rural areas; allowing
cooperatives to receive guarantees on refinanced loans in
certain circumstances; allowing USDA to require appraisals done
in connection with loan guarantees to be conducted by
specialized, as opposed to general, appraisers; allowing USDA
to assess an initial fee for loan guarantees, not to exceed two
percent of the balance due on the loan.
Value-Added Intermediary Relending Program
The bill adds a new section to the Intermediary Relending
Program providing that USDA shall make loans under the terms of
the program for projects to establish, enlarge and operate
enterprises that add value to agricultural products. The
provision establishes a preference for bioenergy projects, and
limits loans to $2 million except in cases where the eligible
intermediary is a State agency.
Use of rural development loans and grants for other purposes
The bill allows USDA to permit a loan or grant recipient to
use the loan or grant for other purposes, meeting certain
requirements, when USDA determines that the circumstances under
which the loan or grant was made have significantly changed.
Simplified application forms for Business and Industry Loans and Loan
Guarantees
This provision allows simplified application forms for
guarantees of farmer program loans under $100,000 and Business
and Industry guaranteed loans under $400,000. It also provides
that after 2003, USDA may increase to $600,000 the limit on the
size of Business and Industry loans eligible to use the
simplified application process.
Rural Entrepreneurs and Microenterprise Assistance Program
This provision establishes a program to provide low and
moderate income individuals with the skills necessary to
establish new small businesses in rural areas, and to provide
continuing technical assistance through local organizations as
these new small businesses begin operating. The funds will also
provide the resources for small loans and loan guarantees
($35,000 or less) to rural entrepreneurs. This program is
modeled on an existing SBA microloan program that has a proven
track record. $10 million a year is provided for this program
for each of the fiscal years 2002 through 2006.
Rural seniors
The bill establishes an interagency coordinating committee
to study health care, transportation, technology, housing,
accessibility, and other areas of need for rural seniors; to
identify successful examples of senior care programs that can
serve as models for other rural communities; and to submit
recommendations to USDA, the House Committee on Agriculture and
the Senate Committee on Agriculture, Nutrition and Forestry.
The bill authorizes $25 million a year for fiscal years 2002
through 2006 for grants to nonprofit organizations of up to 20
percent of the cost of programs that provide facilities,
equipment, and technology for seniors in rural areas.
Community facilities
This provision amends the community facilities program to
provide a reserve of 12.5 percent of community facilities
program funds in each fiscal year to be used for senior
facilities and a reserve of 10 percent of those funds to be
used for child care facilities. In each case the reserve is
effective until April 1 of each fiscal year, after which the
funds may be used for other community facility purposes.
Rural Telework
This provision authorizes $30 million annually for the
Program. Nonprofit organizations and educational institutions
may receive a grant of up to $500,000 for obtaining equipment,
facilities and operating costs for a Rural Telework Center. A
match equal to at least 50 percent of the grant from non-
Federal sources is required. The bill provides for the
selection of a Rural Telework Institute authorized to receive
up to $5 million a year to provide research, develop best
practices and develop innovative projects.
Historic barn preservation
The bill provides that USDA will assist States in
developing a listing of historic barns, collecting and
disseminating information on these barns and promoting their
preservation. The provision authorizes a total of $25 million
for the period 2002 through 2006 for grants under this section.
Grants for emergency weather radio transmitters
This provision authorizes $2 million a year to provide
grants to public and nonprofit entities to acquire radio
transmitters to increase the coverage of National Oceanic and
Atmospheric Administration's emergency weather radio broadcast
system in rural areas.
Bioenergy and biochemical projects
This provision establishes a preference in rural
development assistance programs for bioenergy and biochemical
projects.
Delta Regional Authority
This provision extends the Delta Regional Authority through
2006.
Special Environmental Assistance for the Regulation of Communities and
Habitat (SEARCH) grants for small communities
This provision establishes a new grant program administered
by States through an independent citizens' council for small
communities with populations under 2,500 for the purpose of
providing assistance with initial feasibility and environmental
compliance for rural developmentprojects. States may be awarded
a grant not to exceed $1 million to award Special Environmental
Assistance for the Regulation of Communities and Habitat grants to
small communities. The provision authorizes appropriations of $51
million to carry out this section.
Northern Great Plains Regional Authority
This provision re-establishes the Northern Great Plains
regional authority, to be composed of one member appointed by
the President and confirmed by the Senate, and the Governors of
the States participating in the Authority. The bill provides
that the Authority may approve grants to States and public and
nonprofit entities for projects including transportation and
telecommunication infrastructure projects, business development
and entrepreneurship, and job training. The provision creates a
priority for funding targeted to areas of extreme economic
distress and provides that each State is guaranteed at least a
certain minimum of the overall funding.
Alternative Agricultural Research and Commercialization Corporation
The bill repeals the corporation's authorization and
provides for disposition of its assets.
Telemedicine and distance learning services in rural areas
The provision is extended through 2006.
Guarantees for bonds and notes issued for electrification or telephone
purposes
The bill authorizes USDA to provide guarantees of bonds and
notes issued by eligible private lenders, the proceeds of which
are used to provide private capital for rural electric and
telephone purposes that would otherwise qualify for loans under
the Rural Electrification Act. USDA may deny the request of a
lender for a guarantee if the lender does not have the
expertise or experience, is not qualified, or the bonds are not
financially sound. Bond-funded electric generation projects are
specifically excluded from this program. The provision
establishes a mechanism under which private capital will be
provided for the Rural Economic Development Loan and Grant
(REDL&G) Program. Lenders that receive a guarantee shall pay an
annual fee of 30 basis points, and these fees will be used as
budget authority to finance economic development projects
eligible under the program, with up to a third to finance the
cost of the guarantee program. The provision authorizes
appropriations to cover the possible costs of the program.
Expansion of 911 access
The bill authorizes USDA to make telephone loans to State
or local governments, Indian tribes, or other public entities
for facilities and equipment to expand 911 access in
underserved rural areas, and authorizes such appropriations as
are necessary to carry out the section.
TITLE VII--RESEARCH
The research title extends through 2006 most existing
research program authorizations established in previous laws.
The title also creates a number of new research programs. In
terms of funding overall, this bill provides for $175 million
per year in mandatory funding for agricultural research, an
increase of $635 million over baseline for the 2002-06 period.
Research Title Highlights
Funding for the Initiative for Future Agriculture and Food
Systems is increased from $120 to $145 million per year for
fiscal 2002-06. This program directs research funding to
agriculture priority areas though a competitive grant system.
The bill directs USDA to ensure, as much as possible, that
institutions serving minorities receive no less than 10 percent
of the funding under this program.
Education grants programs for Hispanic-serving institutions
are reauthorized through 2006.
The special authorization for biosecurity planning and
response is amended to create a special account for
appropriations for agricultural research, education, and
extension activities for biosecurity. Under this section funds
may be used under any authority available to the Secretary to
reduce the vulnerability of the United States food and
agricultural system to chemical or biological attack.
The bill creates a new program for rural research funded at
$15 million a year. The program would fund rural policy
research on topics such as: rural sociology, effects of
demographic change, needs of groups of rural citizens, rural
community development, rural infrastructure, rural business
development, rural education and extension programs, and rural
health. These programs will help develop the policy tools
necessary to build a solid foundation within rural communities
for long-term growth and improved quality of life.
The legislation creates a new program to assist beginning
farmers and ranchers at a level of $15 million a year. The
program will provide competitive grants to support new and
established local and regional training, education, outreach,
and technical assistance initiatives aimed at beginning farmers
or ranchers. This program will allow new farmers or ranchers to
acquire entrepreneurial, financial, and other business skills;
conservation assistance; risk management education; innovative
farm and ranch transfer strategies; and basic livestock and
crop farming practices. In addition, 25 percent of the funds
are set aside to be used to support programs and services that
address the needs of limited resource and socially
disadvantaged beginning farmers or ranchers.
The bill allows USDA to make competitive grants for the
acquisition of special purpose scientific research equipment
for use in the food and agricultural sciences programs of
eligible institutions which are: (1) a college or university;
or (2) a State cooperative institution. The amount of the grant
made to an eligible institution under this section may not
exceed $500,000. The program is authorized for appropriations
for up to $50,000,000 annually for each of fiscal years 2003
through 2006.
This provision establishes a priority for grants to
institutions that have the goals of: forming interdisciplinary
teams to review or conduct research, conducting studies on the
biosafety of genetically modified agricultural products,
evaluating identity preservation systems, establishing
international partnerships, or reviewing the nutritional
enhancement and environmental effects of genetically modified
agricultural products.
The assistive technology program for farmers with
disabilities is reauthorized through 2006.
The bill increases the authorizations for formula funds for
research and extension programs, and makes technical changes
that facilitate the ability of historically African American
and Native American institutions to serve their populations.
The legislation includes a variety of provisions that
strengthen organic and sustainable agriculture research
programs, including increased reporting of organic marketing
data, the use of genomics to improve varieties for organic
production and research to assess the needs of the organic
industry regarding identity preservation.
The bill includes a Sense of Congress provision that calls
for the doubling of federal investments in food and agriculture
research over the next five years.
TITLE VIII--FORESTRY
The Department of Agriculture's longstanding commitment to
provide important forestry assistance to private landowners is
continued in the forestry title of the farm bill.
New forestry programs
A sustainable forest management program is created to
provide cost-share assistance to non-industrial private forest
landowners who agree to develop a management plan and implement
approved activities. The program is to be administered by the
Secretary, in coordination with State foresters and State
stewardship coordinating committees. Mandatory funding of
$48,000,000 is available annually.
A program is established to assist in the development of
sustainable forestry cooperatives owned by private forest
landowners, of which at least 51% must be farmers or ranchers.
The program shall provide competitive grants to non-profit
organizations that have demonstrated expertise in cooperative
development. Mandatory funding of $2,000,000 is available
annually.
A community and private land fire assistance program is
established to allow the Secretary to undertake a variety of
activities aimed at preventing fires on both Federal and non-
federal lands. The program authorizes appropriations of
$35,000,000 annually.
A wildfire and hazardous fuel purchase program authorizes
the Secretary to make grants to eligible entities that use
hazardous fuels to generate electricity. This provision
authorizes appropriations of $50,000,000 annually. The program
also authorizes the Secretary to enter into contracts for the
removal of hazardous fuels from forest lands to implement the
National Fire Plan.
A watershed forestry assistance program authorizes the
Secretary to establish a cost-share program to provide to
States, through State foresters, technical, financial, and
related assistance to address water quality and watershed
concerns on forest land. $20,000,000 in appropriations is
authorized annually to carry out the program.
A sustainable forestry outreach initiative is created to
educate landowners about sustainable forestry, professional
forestry advice, and available resources to assist landowners
in practicing sustainable forestry.
Other provisions
Other provisions in the bill: (1) require the Secretary to
establish at least two forest fire research centers at
institutions of higher education; (2) allow the Secretary to
make grants or other arrangements to carry out the Cooperative
Forestry Assistance Act; (3) add the United States Fish and
Wildlife Service to State Coordinating Committees, and re-
affirm the importance of the McIntire-Stennis Cooperative
Forestry Act.
Reauthorizations
The bill reauthorizes the Forestry Incentives Program, the
Renewable Resources Extension Act (authorization of
appropriations is increased to $30,000,000 each year) and the
Office of International Forestry.
TITLE IX--ENERGY
The energy title establishes several new programs providing
incentives to farmers, ranchers and rural small businesses to
develop renewable energy supplies on their lands and to
increase energy efficiency.
New programs
A competitive grant and loan program is established to have
eligible entities provide farmers, ranchers, and rural small
businesses comprehensive energy audits, including renewable
energy development assessments. Mandatory funding of
$15,000,000 is available annually.
A grant and loan program is established so that farmers,
ranchers, and rural small businesses can purchase renewable
energy systems and make energy efficiency improvements.
Mandatory funding of $33,000,000 is available annually.
A competitive grant and loan program is established to
assist cooperatives and business ventures at least 51% owned by
farmers or ranchers for the development of renewable energy
projects to produce electricity. Mandatory funding of
$16,000,000 is available annually.
A competitive grant program is established to support the
development of plants that produce multiple products such as
fuels, chemicals and electricity from biomass. Mandatory
funding of $15,000,000 is available annually.
A competitive grant program is established to demonstrate
the use of hydrogen and fuel cell technologies in farm and
rural applications. Mandatory funding of $5,000,000 is
available annually.
A grant and loan program is established to assist rural
electric cooperatives and rural electric utilities in
developing renewable energy supplies. Mandatory funding of
$9,000,000 is available annually.
New research, development and demonstration programs are
established to promote understanding of and measurement of
carbon sequestration in soils and plants. The programs are
authorized for appropriations at varying levels.
Other provisions
Other provisions in the bill include a biobased products
purchasing requirement for federal agencies if the products are
on a USDA biobased products list and are comparable in price,
performance, and availability to traditional products. In
addition, the section includes a requirement that USDA develop
a labeling program for biobased products. Mandatory funding of
$2,000,000 is available annually.
The Biomass Research and Development Act of 2000 is
extended. Mandatory funding of $15,000,000 is available
annually.
A competitive grant program to educate the public and
entities with vehicle fleets about the benefits of biodiesel
fuel use is authorized with $5,000,000 in annual
appropriations.
The bill includes a stipulation that the Secretary, through
the Cooperative State Research, Education and Extension
Service, and in consultation with the Natural Resources
Conservation Service, may provide education and assistance to
farmers and ranchers for the development of renewable energy
resources.
The bill includes Senses of Congress regarding a national
renewable fuels standard and the bioenergy program of the
Department of Agriculture.
TITLE X--MISCELLANEOUS
Country of origin and quality grade labeling
Section 1001 requires retailers of certain commodities
(beef, lamb, pork, farm-raised fish, perishable agricultural
commodities and peanuts) to inform consumers of the country of
origin of the commodity. The requirements of this provision do
not apply to processed beef, lamb and pork items or to frozen
entrees containing beef, lamb or pork, nor do they apply to
food service establishments. Section 1002 prohibits imported
meat or meat food products from bearing a label indicating a
quality grade issued by the Secretary.
Crop insurance
Section 1011 amends Section 508(e)(4) of the Federal Crop
Insurance Act (7 U.S.C. 1508(e)(4)) by striking the limitation
on the prohibition against continuous coverage. Section 1012
amends Section 508(m)(3) of the Federal Crop Insurance Act (7
U.S.C. 1508(m)(3)) to require that adjustments to the
procedures described in this subsection be made by the 2003
reinsurance year. Section 1013 amends and adds to the list of
loans and payments for which persons who produce agricultural
commodities on highly erodible land without meeting
conventional requirements or on converted wetland, are
ineligible. It also amends and adds to the list of loans and
payments for which persons convicted of cultivating controlled
substances are ineligible.
General provisions
Section 1021 addresses stockyard practices involving
nonambulatory (or ``downed'') livestock. This section provides
that it will be unlawful for any stockyard owner, market
agency, or dealer to buy, sell, give, receive, transfer,
market, hold, or drag any nonambulatory livestock unless the
livestock has been humanely euthanized. This provision does not
apply to animal handling practices on non-GIPSA farms, nor does
it apply in a case where a downed animal receives veterinary
care rendering the animal ambulatory.
Section 1022 reauthorizes and extends through 2006 the
cotton classification activities of the Department of
Agriculture under the Cotton Statistics and Estimates Act.
Section 1023 amends the Food Security Act of 1985 to
conform to the revised Uniform Commercial Code. It allows
filings for security interests in farm products to identify the
State, county, or parish in which the product is located,
instead of requiring the exact description of property where
the product is located.
Sections 1024 and 1025 amend the Animal Welfare Act to
prohibit the transportation, for fighting purposes, of animals
in interstate and foreign commerce and increase the penalties
for violations.
Section 1026 requires USDA to carry out an outreach and
technical assistance program to encourage and assist socially
disadvantaged farmers and ranchers in owning and operating
farms and ranches, and in participating equitably in the full
range of agricultural programs offered by USDA. This section
allows USDA to make grants and enter into contracts with
qualified entities to provide information and technical
assistance under this provision. Appropriations are authorized
to carry out the section.
Section 1027 requires USDA to report election data related
to the representation of socially disadvantaged groups on
county, area, and local committees. It requires USDA to
promulgate and publish in the Federal Register proposed uniform
guidelines for conducting elections for members and alternate
members of county, area, and local committees. The procedures
must insure, through appointment or other means, that
additional voting members of the committee fairly represent
socially disadvantaged groups if they are under-represented
within that area.
Section 1028 reauthorizes and extends the Pseudorabies
Eradication Program through 2006.
Section 1029 authorizes, subject to appropriations, a Tree
Assistance Program under which USDA may provide assistance to
eligible orchardists in case of natural disaster. Assistance
will consist of reimbursement of 75 percent of the cost of
replanting trees lost due to a natural disaster, in excess of
15 percent mortality as adjusted for normal mortality, or at
the discretion of the Secretary of Agriculture, sufficient
seedlings to reestablish the stand.
Section 1030 provides $3.5 million in funds for fiscal year
2002 for the Secretary to establish a national organic
certification cost-share program to assist producers and
handlers of agricultural products in obtaining certification
under the national organic production program established under
the Organic Foods Production Act of 1990. Payments to producers
or handlers are limited to $500, and the federal share of the
certification cost will be no more than 75 percent of the total
certification cost incurred.
Section 1031 authorizes $3 million to be appropriated to
establish a Food Safety Commission. The Commission will make
specific recommendations that build on and implement the
recommendations contained in the National Academy of Sciences
report entitled ``Ensuring Safe Food from Production to
Consumption'' and serve as the basis for draft legislation to
improve the food safety system.
Section 1032 expresses the sense of Congress that the
Humane Methods of Slaughter Act should be fully enforced and
that USDA should resume tracking violations of the Act.
Administration
Section 1041 allows the Secretary to promulgate regulations
to implement this Act, and provides for procedures for doing
this. Section 1042 describes the effect of this Act on existing
law
III. Purpose, Need and Background
TITLE I--COMMODITY PROGRAMS
Background
For almost 60 years the United States provided assistance
to farmers in times of low commodity prices. This practice was
abandoned in 1996 when Congress passed the Federal Agriculture
Improvement and Reform Act of 1996 (FAIR) which purported to
help U.S. farmers make the transition from government
dependence to greater market reliance.
When the FAIR Act was being considered, the U.S. farm
sector enjoyed high prices and a robust market expansion
period. Commodity prices were high and were projected to remain
high during the seven years of the farm program. Years of
favorable weather in major producing regions, the financial
crisis in East Asia in late 1997, and a strong U.S. dollar all
contributed to dramatically lower commodity prices than any of
the experts forecasted.
After less than two years of farm policy under the FAIR Act
with commodity prices 50 percent or more below their 1995-1996
peaks, producers learned that the transition payments were
inadequate to meet their cash flow needs. Congress responded
with ad hoc emergency payments in 1998, 1999, 2000 and again in
2001. While these payments helped alleviate the crisis in the
farm sector, the payments did nothing to address questions of
whether the underlying agricultural policies were inadequate
for U.S. agriculture.
Although American agriculture is one of the most efficient
sectors of the U.S. economy, that efficiency has not brought
prosperity to those who produce the food and fiber in this
country. Producers of row crops face the fourth consecutive
year of low commodity prices compounded by rising costs of
production. The ad hoc assistance of the last four years was
neither carefully crafted, nor sustainable for the future.
The budget resolution provided additional funds for the
Committee on Agriculture, Nutrition and Forestry to improve
farm programs and provide better income protection for U.S.
farmers and ranchers.
The Committee invited numerous agricultural organizations
to present their views on how farm programs could be modified
to benefit the producers those organizations represent.
Predictably, the Committee heard a wide range of suggestions on
how to improve the current program. There were, however, common
suggestions and some ideas that won broad support.
First, every organization supported producer flexibility.
Even those organizations that suggested supply management in
one form or another wanted to retain flexibility. The
flexibility to plant a wide range of agricultural crops without
losing program benefits is an important component of current
law that will be continued in the next farm program.
Producers have had planting flexibility for six years. For
many producers their recent cropping history is very different
than the bases on which they have been receiving payments. The
Committee bill adds soybeans and other oilseeds to the list of
contract commodities and allows producers to update their
contract acreage and payment yields to reflect their recent
production history. However, those producers who choose not to
update acres and yields will be able to retain their current
contract acres and yields and add oilseeds acres and recent
yield experience to a maximum of the eligible cropland on the
farm.
This change in policy will provide greater equity for those
producers who have been growing the covered commodities, but
who happen to farm land that has a relatively low base or a low
payment yield. During the years when payment yields were
established--1981 through 1985--some producers were able to
establish relatively high yields while neighbors with similar
production experience were unable to obtain the same advantage
The payment yield data is a generation old. It is time to give
producers the option of providing recent acreage and yield
data.
Second, most organizations called for some form of counter-
cyclical payment to support farm income when commodity prices
or farm income falls. This has been the greatest weakness of
the current program and one which the Committee addresses in
two ways.
Direct and counter-cyclical payments
The bill provides very substantial direct fixed payments
during the first two years and lower payments in the third,
fourth and fifth years. As the direct fixed payments decline,
the bill authorizes counter-cyclical payments to assure that
producers receive at least the income protection price on their
contract acreage. This protection is available as long as the
producer complies with conservation of highly erodible land and
wetlands and uses the contract acreage for an agricultural use
other than the production of prohibited fruits and vegetables.
Marketing assistance loans and loan deficiency payments
The marketing assistance loans and loan deficiency payments
provide additional counter-cyclical support for each bushel,
pound or hundredweight of each loan commodity produced. Loan
rates for most commodities have been frozen at 1996 levels. The
Committee-passed bill raises the loan rates for all commodities
with the exception of soybeans and extra long staple cotton.
The soybean loan rate is slightly lower than the $5.26 per
bushel available for the 2001 crop and the ELS cotton loan rate
is held constant.
The loan rates for the three largest row crops--corn,
soybeans and wheat--are carefully balanced to reduce unintended
incentives to plant one crop over another. The loan rates for
other commodities are adjusted to assure that producers are not
discouraged from planting those crops. For instance, the grain
sorghum loan rate is established at the same level as the corn
loan rate so farmers will consider planting grain sorghum
rather than the alternative corn.
Likewise, the bill raises the loan rate for minor oilseeds
to give producers an alternative to wheat. In implementing the
marketing assistance loan program for minor oilseeds, the
Committee directs the Department to establish one sunflower
loan rate and loan repayment rate for eachcounty. The
Department has established separate loan programs for oil-type and
confection or other-type sunflower seed. This differentiation does not
accurately reflect market relationships, and the Committee is concerned
that this implementation disadvantages confection-type sunflower seed
growers and threatens the domestic confection industry when oil-type
sunflower prices are below marketing loan levels. The Committee
understands under these circumstances grower contracts could be offered
at levels unrepresentative of world market prices, presenting the
opportunity for foreign competitors to contract for and export
confection products at levels that undercut U.S. access to traditional
foreign markets.
Under this Act the Committee expects the Department to
implement a combined loan program that treats all sunflower
seed equally. The Committee directs the Department to establish
one county loan rate for sunflower seed according to the
national average rate for minor oilseeds in this Act ($0.095
per pound). The Committee expects the Department of continue
announcement of weekly loan repayment rates for sunflower
reflecting local market prices which minimize potential loan
forfeitures. Accordingly, sunflower seed loan repayment rates
should reflect oil-type sunflower seed local market prices.
The bill adds a new loan program for the pulse crops--dry
peas, lentils and chickpeas. These crops compete for acreage
against those crops that have long-standing loan programs. The
new loan program for the pulse crops is intended to eliminate
the disincentive to produce those crops.
Dairy
At a farm-level value of $23 billion, dairy is the second-
largest farm commodity produced in this country, behind only
beef.
The dairy industry is unique among agricultural commodities
because milk is highly perishable, and not easily transported
or stored. Dairy farmers must market their production virtually
every day, regardless of price. As a result, the dairy industry
has generally been subject to a larger degree of government
intervention and regulation than most other commodities.
The price of milk to dairy producers in the United States
has been supported continuously for over 50 years since the
enactment of the Agricultural Act of 1949. Since 1981, the
support level has been established by Congress either at
specific price levels, or by formula tied to anticipated
Commodity Credit Corporation (CCC) dairy product purchases. The
current support price of $9.90 per hundredweight for milk
containing 3.67 percent milkfat has been in effect since
January 1, 1999.
In the early 1980's the price support level was above
$13.00 per hundredweight. At that level, the program generated
milk production above market demand and resulted in CCC
purchasing more than 10 percent of U.S. milk production at a
cost exceeding $2 billion annually. Starting in December 1983
the price support level was reduced through a series of $0.50
per hundredweight reductions. In addition to the price support
reductions, Congress enacted short-term programs in the mid-
80's that provided incentive payments to dairy producers who
voluntarily reduced or terminated milk production. To reduce
CCC price support costs the Congress instituted an assessment
on milk marketed by producers that was paid to the government.
The combination of lower prices, incentive payments to reduce
production and assessments resulted in lower production and
reduced CCC dairy product purchases.
The FAIR Act contained provisions to end the Dairy Price
Support Program effective December 31, 1999 and establish a
recourse loan program for milk effective January 1, 2000. The
Act also terminated the authority to assess milk marketed.
When the FAIR Act was being considered milk prices were
averaging about $3.00 per hundredweight above the support price
and dairy products were not being sold to CCC. Milk prices fell
below the $9.90 per hundredweight support level by the end of
1999 and remained at low levels throughout 2000. The low prices
for dairy producers prompted Congress to reconsider the
decision to end the Dairy Price Support Program on December 31,
1999 and laws extending the program through 2000 and
subsequently through 2001 were enacted.
On three occasions starting in June 1999 USDA has made
market loss assistance payments amounting to almost $1 billion
to assist dairy producers facing reduced milk prices. In June
1999, a total of $200 million was paid to dairy producers. The
second payment made in April 2000 totaled $125 million. The
third payment made in December 2000 totaled $645 million.
The Committee has found that the existing safety net for
dairy farmers is inadequate and has therefore included a new,
national, dairy program that will improve dairy farmer income.
It effectively establishes a new national minimum price per
hundredweight for raw milk used for Class I, or fluid milk, and
a supplemental income protection program to provide counter-
cyclical income support payments to producers of raw milk
during periods of low milk prices. Whenever the Class III price
falls below $14.25 per hundredweight, producers would receive
payments under this program.
The government assists dairy exports through the Dairy
Export Incentive Program (DEIP). The program is used to help
U.S. dairy products meet competition from subsidizing
countries, especially the European Union. Products eligible for
DEIP are milk powders, butterfat and cheese. The DEIP is
currently authorized through December 31, 2002. The Committee
extends it through 2006.
The Fluid Milk Promotion and Education Program (also known
as MilkPEP) has contributed to slowing the decades-long erosion
in milk consumption and positioned the milk industry to better
compete with soft drinks and other beverages. The program,
which has been in effect for six years, works in close
coordination with the dairy producer promotion program to
maximize the effectiveness of dollars spent to enhance milk
sales. The Committee extends the MilkPEP program through 2006.
The Dairy Market Enhancement Act of 2000 provided that the
Secretary of Agriculture should establish a program of
mandatory dairy product information reporting to provide
timely, accurate, and reliable market information. To date, the
Department of Agriculture has not established aprogram of
mandatory stored dairy products reporting presumably due to questions
concerning the authority to establish reporting requirements for
substantially equivalent dairy products. Therefore, this legislation
provides explicit authority to establish such a program.
The Dairy Production Stabilization Act of 1983 (Dairy Act)
authorized a national producer program for dairy product
promotion, research, and nutrition education to increase human
consumption of milk and dairy products and reduce milk
surpluses. Under the program promotion and research is
conducted to strengthen the dairy industry's position in the
marketplace and to maintain and expand domestic and foreign
markets and uses for fluid milk products and dairy products
produced in the United States. This legislation extends the
Dairy Act through 2006 and expands it to include imported
products.
Sugar
American sugar producers have been facing sugar prices at
or near 22-year lows for most of the past two years. The U.S.
government is no longer able to limit sugar imports
sufficiently to support prices and avoid sugar forfeitures.
Last year, for the first time in nearly two decades, sugar
producers forfeited a significant quantity of sugar to the
government.
Since 1996, 17 beet and cane processing mills have closed
or announced their impending closure. Sugar beets and sugarcane
are highly perishable and have no commercial value until the
sugar has been extracted. This makes sugar producers
particularly dependent on their local processor--without a
processor, there is no reason to produce sugar beets or
sugarcane.
U.S. sugar producers asked the Committee to reestablish
marketing allotments in an attempt to limit domestic production
to levels that--with imports--will not exceed demand for sugar
for human consumption. The allotments should bring supply into
balance with demand to enable the Secretary to implement the
program at minimal net cost. However, the bill eliminates other
assessments, penalties and fees which were implemented to help
reduce budget deficits. The bill terminates the marketing
assessment on sugar, eliminates the loan forfeiture penalty and
reduces the CCC interest rate on price support loans
To further manage supply, the bill authorizes a payment-in-
kind program to allow the Commodity Credit Corporation (CCC) to
accept bids from processors of sugar cane and sugar beets to
obtain raw cane sugar or refined beet sugar in the inventory of
the CCC in return for reduction in production of raw cane sugar
or refined beet sugar. This provision clarifies and enhances
the CCC's authority to dispose of sugar it has obtained through
forfeitures of sugar or other means. Through this authority,
the CCC may administer a pre-plant payment-in-kind program for
sugar cane or sugar beets to assist in the reduction of CCC
sugar inventories. A pre-plant payment-in-kind program is an
effective method of reducing CCC inventories of sugar because
it reduces the CCC's inventory storage and disposal costs and
avoids significant on-farm production costs.
Peanuts
The Committee is recommending a dramatic change, and a
significant investment of public resources, in the program for
peanut producers. The program has long been of great importance
to peanut producers, primarily in Georgia, North Carolina, and
Virginia. The program and the peanut itself have had a long and
colorful history. The lowly ``goober pea'' was and continues to
be an important part of the economic history and foundation of
the South. George Washington Carver's efforts to create new and
useful products from peanuts has made him one of the most
celebrated agriculturalists in American history. The
Agricultural Act of 1938 contains the provisions, as amended
over the years, which provide for peanut quotas and the price
support activities which have enabled peanut production to
remain profitable over the course of many changes in
agriculture and agriculture policy.
The peanut program has changed and evolved over the years,
especially when it was moved to a no-net-cost program in the
1980's. However, there is a concern within some segments of the
industry that the program must now be fundamentally changed.
Certainly this view is not universally shared, and especially
among some farmers. However, looking into the future, there is
a belief by many that the current program is not sustainable in
a world of free trade and increasing production of quality
peanuts in other countries. Moreover, the concern is that
peanut imports are slowly increasing and will continue to
increase as the peanut tariff rate quota is eliminated under
existing trade agreements. The argument is that without
significant changes the current program will become unworkable
as the quota is reduced more each year to maintain program
objectives.
The Committee bill proposes to change the program and bring
it more in line with the other commodity programs.
Specifically, marketing quotas are abolished and a new system
of peanut base acres and peanut yields are established. The new
program creates a safety net for producers in the form of
marketing loans, direct payments, and counter-cyclical
supports. Quota holders will be compensated at an established
rate for the value of their quota over a five year period.
Quota holders that are not involved in peanut production and
that have depended on annual income from the rent of their
quota will need to adjust to a future without this source of
income.
There will be other adjustments during the transition to
the new program. It is likely that there will be regional
impacts and perhaps dislocations among producers, especially in
higher cost areas of production. The existing program has
functioned by keeping the supply of peanuts in close proximity
with demand such that the Government established support rate
has not resulted in large amounts of forfeited peanuts. The
result is that over the years processors, product manufacturers
and consumers have all contributed to sustaining the program.
Under the new program, this connection will no longer be in
place. Due to the lower support rates under the new program,
processors and manufacturers will enjoy significantly cheaper
peanuts. Whether consumers will ultimately benefit remains to
be seen. Producers can anticipate a more competitive production
and marketing environment. Those producers that can continue to
produce low cost and high quality peanuts may see greater
rewards from the marketplace. Regardless, all peanut producers
in the program will benefit from the new safety net provided in
the Committee bill.
Adjustment Authority Related to Uruguay Round Compliance
Although this bill increases support to U.S. producers,
expenditures under this bill are not expected to exceed the
total allowable domestic support levels established in the
Uruguay Round Agreement on Agriculture. However, to ensure that
the United States meets its international obligations, the
Committee bill includes authority to allow the Secretary to
reduce domestic support expenditures to a level that meets but
does not exceed WTO commitments. The Committee expects the
Secretary to implement any reductions in a fair, equitable and
proportionate manner considering the effect that the support
for a particular commodity has on the Secretary's determination
that expenditures will otherwise exceed the allowable domestic
support.
Commodity Purchases
Proper nutrition, including increased consumption of fruits
and vegetables, is crucial to the health and well being of our
nation's school children. By requiring the Secretary of
Agriculture to use CCC funds to assure the purchase of
specialty crop items for distribution to the National School
Lunch Program, The Emergency Food Assistance Program, and other
nutrition programs, the bill will further the objective of
improved nutrition at the same time it provides much needed
assistance to producers of specialty crops. At least $50
million of the funds available each fiscal year would be used
to supplement an extremely popular program that utilizes the
expertise of the Department of Defense to purchase fresh fruits
and vegetables for schools in the National School Lunch
Program.
TITLE II--CONSERVATION
Background
The Department of Agriculture operates several conservation
programs through both the Natural Resources Conservation
Service (NRCS) and the Farm Service Agency (FSA). These
programs provide producers and landowners opportunities to
manage their privately owned agricultural lands in a manner
that enhances natural resources, including the implementation
of practices that protect water and air quality, reduce soil
erosion, and increase wildlife habitat.
Conservation programs funded through the Credit Commodity
Corporation are weighed heavily toward programs that take land
out of production with the majority of the funds directed
toward the Conservation Reserve Program (CRP).
CRP, which is managed by FSA, was originally authorized in
the Food Security Act of 1985 (the 1985 Farm Bill) for 40-45
million acres. In the Federal Agriculture Improvement and
Reform Act of 1996 (the 1996 Farm Bill), the acreage was
limited to 36.4 million acres. Currently, nearly 34 million
acres are enrolled in CRP. Starting in 1990, applicants wishing
to enroll land in CRP had to bid competitively during open
sign-ups that occurred no more than once a year.
In addition to general CRP, two programs were established
under CRP to enroll more environmentally sensitive lands.
Applicants do not have to bid their land in these programs.
Originally authorized in the Food, Agriculture,
Conservation and Trade Act of 1990 (the 1990 Farm Bill), the
Conservation Reserve Enhancement Program (CREP) is a highly
successful State-Federal matching program created to address
specific State and local concerns, including water quality,
soil erosion and wildlife. Currently, 19 States have CREPs with
a total of 246,000 acres enrolled. The second program, the
Continuous Sign-up CRP which began in 1996, allows producers to
directly contract with FSA to enroll lands that address water
quality, by enrolling riparian buffers, filter strips, contour
grass strips, and grass waterways. Approximately 1.56 million
acres have been enrolled nationally.
In addition to CRP, the Wetlands Reserve Program (WRP),
authorizes the Secretary, through NRCS, to work with and
provide payments to landowners for restoring or protecting
wetlands. WRP was originally authorized in the 1990 Farm Bill
as a pilot program under CRP for a total of one million acres.
In the 1996 Farm Bill, the total acreage was reduced by 25,000
acres to 975,000 acres and WRP was made an independent program.
As part of the Agricultural, Rural Development, Food and Drug
Administration and Related Agencies Appropriations Act for
fiscal year ending 2001, an additional 100,000 acres was added
to WRP. The Secretary may enroll wetlands in WRP through
permanent and 30-year easements and restore wetlands through
ten-year cost-share contracts.
The Environmental Quality Incentives Program (EQIP) was
originally authorized in the 1996 Farm Bill and was funded at
$200 million annually after the first year. EQIP provides
technical, financial, and educational assistance to crop and
livestock producers to address soil, water and related natural
resource concerns. EQIP provides producers with incentive
payments for up to three years to implement land-based
management practices, including nutrient and pest management,
and cost share for structural practices and equipment,
including tree planting, filter strips and, for small and
medium-sized livestock owners, animal waste storage structures.
By statute, EQIP was required to maximize environmental
benefits per dollar expended, and as a result, has concentrated
its funding in priority areas that are identified at the State
level. Over the years, nearly 74 percent of the funds under
EQIP were directed toward priority areas. In addition, a
mandatory split was included that ensure 50 percent of the
funds were provided for livestock operations. Eligible
producers enter five-to-ten year contracts and payments are
limited to $50,000 over the contract period and $10,000
annually. Because producers need to bid for funds under EQIP
and funds are directed toward maximizing environmental
benefits, many producers do not receive funds. Moreover, funds
under EQIP cannot be used to maintain practices previously
adopted by producers.
The Farmland Protection Program (FPP) was originally
authorized in the 1996 Farm Bill for $35 million after the
success of a one-State pilot program authorized in the 1990
Farm Bill. The FPP originally was designed to allow States and
local governments to leverage Federal funds to purchase
development easements on agricultural land. Since 1996, changes
to allow non-profit organizations to participate have allowed
FPP to expand to many more States. The original $35 million and
an additional $17.5 million added in the Agricultural Risk
Protection Act of 2000 (ARPA) was allocated quickly.
The Wildlife Habitat Incentives Program (WHIP) was
originally authorized in the 1996 Farm Bill for $50 million.
The funding under WHIP was allocated by the end of fiscal year
1999. WHIP provides up to 75 percent cost-share for
implementing fish and wildlife habitat improvement practices on
private lands, including lands of Indian tribes. Under WHIP,
States have great flexibility in determining wildlife
priorities and which landowners receive assistance. An
additional $12.5 million was added in through ARPA.
The Resource Conservation and Development (RC&D) Program
was authorized in the Food and Agriculture Act of 1981. The
RC&D program authorized the creation of 450 multi-county
councils to help develop rural economies while improving
natural resources at the local level. Currently, there are 348
Councils.
The Conservation of Private Grazing Land Program was
authorized for appropriations at $60 million annually in the
Federal Agriculture Improvement and Reform Act of 1996. Under
the program NRCS provides technical, educational, and related
assistance to owners of private grazing lands to ensure better
management of grazing lands.
The 1990 Farm Bill required the Secretary to create a
technical committees in each State to serve in advisory roles
on the administration of conservation programs at the State and
local levels. The wide membership of the technical committees
was designed to maximize the local involvement and cover a wide
variety of natural resource disciplines. The technical
committees have worked well in many States, but in other States
the technical committees have not functioned as planned because
meetings and other essential activities do not occur.
Technical assistance provided through conservation programs
was restricted in the 1996 Farm Bill as a cost-savings measure
to $36.2 million. As a result, full implementation of the
programs have been hampered. In addition, the number of
employees at NRCS who provide technical assistance has
decreased by 2,000 employees since 1985, from 13,600 employees
to 11,600 employees. In some cases, NRCS has successfully
partnered with governmental and non-governmental organizations,
like conservation districts, to provide technical assistance.
Purpose and Need
Despite the conservation successes from current USDA
programs, the Committee recognizes that more can be done. For
that reason, the Committee improves existing programs and
creates new ones. The bill increases funding for conservation
programs by $20.5 billion above the baseline of approximately
$21.5 billion over the next 10 years. The bill provides over
$18 billion in total conservation spending over the next five
years. The bill further improves existing programs, strengthens
technical assistance, including a new provision that fosters
technical assistance through third party providers. It also
creates a critically needed working lands programs, and
requires the Secretary to better coordinate all programs to
avoid duplication and ensure better delivery to participating
producers and landowners. The bill consolidates most
conservation programs (except for the Resource Conservation &
Development Program and State Technical Committees) in the Food
Security Act of 1985 to facilitate use of conservation
programs. To improve implementation and delivery of
conservation programs, the Secretary is required to assess all
USDA conservation programs and provide Congress with reform
recommendations to improve efficiencies, eliminate overlaps and
redundancies, and simplify operations.
National Conservation Program
The bill requires the Secretary to develop a plan and
budget for implementing the National Conservation Program
(NCP). The NCP is an appraisal of the nation's soil, water, and
related resources and the Committee intends that the NCP be
used as the framework for a coordinated national plan for the
conservation of agricultural lands. Because of the importance
of proper coordination, the Committee requires the Secretary to
provide the plan to Congress within 180 days after the
enactment of this bill and to provide Congress with a status
report on the NCP plan by April 30, 2005.
State and local partnerships
In order to build upon the many State, local and private
partnerships the Secretary maintains, the bill authorizes the
Secretary to continue and expand these partnerships to allow
producers to address environmental issues affected by
agricultural production. The bill authorizes the Secretary to
work, including through partnerships, on special projects in
environmentally-sensitive areas or watersheds that are not
currently covered by existing programs or that require special
attention.
conservation technical assistance
This bill lifts reimbursement restrictions placed during
the 1996 Farm Bill on the availability of funds by exempting
technical assistance from the Section 11 cap of the Commodity
Credit Corporation. Moreover, the Committee recognizes the need
to increase access for technical assistance from other sources.
For that reason, the Committee requires the Secretary to create
a third-party certification program that allows non-USDA
employees to receive compensation for providing technical
assistance under all conservation programs.
The Committee recognizes that many States and local
governments already employ individuals to provide technical
assistance. For that reason, funds for third party providers
shall not be used to reimburse employees of State and local
governments unless the Secretary is satisfied that the funds
will increase the base of conservation technical assistance
provided under the conservation programs.
Certification of technical assistance providers
The Committee further recognizes that multiple institutions
and groups provide certification for the provision of technical
assistance and the Secretary should implement regulations that
take these programs into account and do not interfere or
discourage certification through these groups. The bill
authorizes the Secretary to grant full or partial waivers for
certification and for the payment of fees for individuals
accredited through an equivalent organization, as determined by
the Secretary. However, the Committee also recognizes that
certification by an accredited group does not mean that the
accredited person is qualified to provide all forms of
technical assistance. In addition to technical assistance, the
Secretary shall provide education and outreach to allproducers,
including limited resource producers, Indian tribes and beginning
farmers and ranchers.
Confidentiality of information
Because of the sensitivity of information provided by
producers and landowners participating in conservation
programs, the bill provides for the Secretary to maintain the
confidentiality of the provided information. The information
only may be released in an aggregate form that does not reveal
individual producer information. Moreover, it is not the
Committee's intention to interfere with Freedom of Information
Act requirements.
Conservation Reserve Program (CRP)
This bill reauthorizes, through fiscal year 2006, and
expands CRP from 36.4 million acres to 40 million acres. While
the Committee does not specifically reserve acreage for the
continuous sign-up program or CREP it is expected that the
Department will continue to reserve at least five million acres
for these very successful programs. The legislation codifies
these two programs and all references to buffers and successor
programs shall be read to mean all practices or programs that
allow a producer to enroll land on an on-going basis, as
opposed to only during a general sign-up. And, to increase the
attractiveness of these programs, the legislation provides
enhanced incentives for all continuous practices. Some
producers have recently begun cropping previously non-cropped
lands for the purpose of later enrolling the land in CRP. The
legislation would prohibit enrollment of highly erodible lands
that do not have a cropping history during three of the last
six years as a means of discouraging producers from planting
crops on non-cropped lands for later CRP enrollment.
Wetlands Reserve Program (WRP)
All authorized acreage available under the highly
successful WRP has already been enrolled. The Committee
recognizes the need for additional acreage, as evidenced by the
large backlog for participation and the continuing loss of
wetlands. To address this need, this bill reauthorizes WRP,
through fiscal year 2006, and increases the total acreage cap
by 1.25 million acres. To build upon the CREP framework, the
Committee authorizes the Secretary to enroll up to 25,000 acres
annually in a new Wetlands Reserve Enhancement Program (WREP).
WREP encourages federal coordination with State and local
governments and private organizations to focus resources on
critical environmental needs, including water quality and
wildlife habitat. Unlike CREP, the State and local governments
are not required to provide financial cost-share.
Environmental Quality Incentives Program (EQIP)
This bill reauthorizes EQIP through fiscal year 2006, EQIP.
Requests for EQIP assistance far exceed available funds. The
legislation provides increased funding for EQIP for a total of
$5.2 billion over the next five years. Increasing funding over
time will allow NRCS to more effectively implement the program.
The legislation provides $500 million for fiscal year 2002,
$1.05 billion for fiscal year 2003, $1.2 billion for each of
fiscal years 2004 and 2005, and $1.25 billion for fiscal year
2006.
Although many federal regulations impacting agriculture
have been on the books for decades, a recent interest in their
enforcement, in addition to more active regulation by State and
local authorities, many producers have turned to the Federal
Government for assistance to comply with these regulations or
to implement practices that can help them avoid regulation. To
make EQIP funds more useful to all producers and to ensure that
sound environmental practices are properly adopted, the bill
increases the total amount available under a contract to
$150,000 and the annual limit to $50,000. Given this increase,
the Committee believes that these funds should only be made
available where the Secretary can ensure that the funds are
limited to one person or entity. In the case of contracts for
animal waste facilities, a producer can have one contract
during the five-year period covered by the farm bill. EQIP
contracts for animal waste structures currently require
nutrient management plans and the bill continues this
requirement. The Committee believes that these collective
requirements are essential to achieve maximum environmental
benefit in the most equitable manner.
Under the bill all producers are eligible for EQIP funds
and it is not the intention of the Committee to give priority
to producers who are or may be regulated at the expense of
providing funds for non-regulated producers. In fact, the
Committee believes that one of the strengths of EQIP is that it
provides funds to producers with less means to move toward more
environmentally-sensitive management of their operations. To
better reach producers with limited resources, including
beginning farmers and those who rent lands on a short-term
basis, the bill reduces minimum contract length to three years,
and increases the level of cost-share provided to limited
resource producers and beginning farmers and ranchers to 90
percent. The Committee also recognizes that priorities vary
across States. To ensure that each State uses the funds in the
manner that ensures the greatest level of environmental
benefit, the bill does not mandate a split between livestock
and non-livestock concerns. The Committee, however, strongly
discourages NRCS from allowing States to favor one type of
producer at the expense of others. To facilitate
implementation, the legislation no longer requires each
applicant to have a conservation plan developed prior to
acceptance in EQIP, but still requires development of a
complete conservation plan by producers who carry out an EQIP
contract.
The Committee recognizes the need for the Secretary to have
flexibility to establish special projects and provides five
percent of EQIP funds to be used in watersheds and other areas
of regional significance to address water conservation,
including irrigation projects to increase water management,
nutrient management and wildlife habitat.
Innovative approaches to conservation
The Committee further recognizes that many important ideas
come from the private and non-Federal sector. To encourage
development of innovative approaches, the Secretary may use up
to $100 million annually to pay the Federal share of
competitive grants to stimulate innovative approaches to
protect environmental quality in conjunction with agricultural
production. In creating this grant program within EQIP, the
Committee was particularly concerned with the degradation of
our nation's waters. This degradation results in the loss of
productive habitat for fish and wildlife, causes billions of
dollars in lost economic activity, forces businesses and
municipalities to bear the cost of cleaning up contamination,
and may threaten human health.
The Committee believes that the protection of source water
for human consumption should be a high priority for the use of
grants for innovative conservation practices and that water
utilities should be important partners with agricultural
producers in the development and implementation of conservation
projects under this grant program.
The Committee also believes that the Secretary should place
a high priority on reducing nutrient loadings--particularly
nitrogen and phosphorus--from agricultural lands. By
establishing market-based incentives to reduce nutrient
discharges from agricultural lands an efficient mechanism is
created to improve water quality and create environmentally
beneficial income alternatives for farmers. The Committee
intends for the Secretary to work with the State and private
organizations to target investments in nutrient reductions
where they are most cost effective through competitive
selection processes; test a variety of reduction techniques;
encourage alternative land use practices that reduce nutrient
runoff while still producing income; and contribute to the
economic viability of agricultural operations. The Committee
recognizes that the requirement that the Federal share cannot
exceed 50 percent may mean that not all funds will be expended
within the fiscal year. Therefore, legislation requires that
funds not committed by June 1st be made available for use under
the rest of EQIP.
Farmland Protection Program (FPP)
The Committee further recognizes the importance of FPP in
preventing the accelerating expansion of urban and suburban
areas into agricultural lands. The funds for FPP increase over
time to a total $1.025 billion over five years, but in a manner
that allow NRCS to implement the programs successfully and work
with States that do not currently have programs. The
legislation provides $150 million for fiscal year 2002, $200
million annually for fiscal years 2003 and 2004, $225 million
for fiscal year 2005, and $250 million for fiscal year 2006.
The bill also expands eligible lands to include cropland,
rangeland, grassland and forested land on farms or ranches. The
Committee does not intend to open FPP to forest land that is
not an integral part of an operating farm or ranch. To build
upon recent successes from expanding the program, this bill
expands participation in the program to non-profit
organizations. To help participating farms and ranches to
develop business plans to remain in agriculture, this bill
allows the Secretary to dedicate up to $10 million annually for
Farm Viability Grants.
Wildlife Habitat Incentives Program (WHIP)
The bill reauthorizes WHIP, through fiscal year 2006, and
expands the resources and types of assistance currently
eligible under the program. Because the Committee recognizes
the enormous benefits that come from protecting wildlife
habitat on private lands restored under WHIP, the bill
increases total funding to $500 million over five years. The
legislation increases the funding over time to allow NRCS to
implement the programs in a manner that allows for the
effective use of funds. The legislation provides $50 million
for fiscal year 2002, $100 million annually for fiscal years
2003 and 2004, and $125 million annually for fiscal years 2005
and 2006.
The Committee recognizes the unique habitat needs of
threatened and endangered species, and for that reason requires
the Secretary to reserve not less than 15 percent of funds
under WHIP for projects focusing on threatened and endangered
species. To further address the needs of threatened and
endangered species, the bill authorizes the Secretary to
establish a pilot program to use up to an additional 15 percent
of the available funds under WHIP to enroll lands critical for
habitat for threatened and endangered species for a period of
15 years or longer.
Conservation Security Program (CSP)
There are nearly 900 million acres of agricultural land in
the United States and the Committee recognizes the urgent need
to address conservation on those lands. While increased funding
for working land programs like EQIP and WHIP help advance
conservation on private agricultural working lands, the
Committee believes that a conservation incentives program will
fill the gaps in USDA programs. An incentive program, like the
one established in the Conservation Security Act, provides a
new direction for agriculture. Through this new Conservation
Security Program (CSP), which the bill authorizes through
fiscal year 2006, producers will receive income for maintaining
or adopting conservation practices. All producers with lands in
production may participate in the CSP. Moreover, the payments
are designed to be consistent with international trade
obligations, and the Committee expects the Secretary to ensure
that regulations implementing the CSP remain consistent with
these obligations.
Because of the importance of CSP, and its design to serve
all agricultural producers with lands in production, the
Committee strongly encourages the Secretary to expedite
implementation of the program. Because the CSP is specifically
designed to reach all producers, the Secretary shall not create
an allocation system based on a limited level of funding, but
instead shall use all funds necessary for full implementation
as required under the legislation.
Over the years, it has become clear that producers who
adopted good conservation practices using their own time and
money were not eligible for USDA conservation programs.
Although these good stewards have contributed greatly to
agriculture's efforts to enhance natural resources and protect
the environment, the structure of conservation programs did not
recognize, nor reward, their efforts. While the Secretary shall
implement the CSP to achieve maximum environmental benefit, the
regulations should be constructed to promote maintenance of
conservation practices. Under CSP all producers are eligible to
participate and do not have to bid into to participate.
Producers that would not receive funding under other USDA
conservation programs, may participate in CSP and provide
important conservation benefits. One important element of CSP
is that producers may continue to have economic uses of the
land consistent with the objectives of the conservation
security plan. This element further enables producers to
implement conservation practices on working lands.
The Committee recognizes the importance of ensuring the
programs work at the State and local level and the CSP requires
local involvement and participation at all levels. In carrying
out the CSP, the Secretary shall ensure maximum participation
by producers at the local and State levels. To ensure maximum
participation by producers, CSP provides maximum flexibility to
participating producers to engage in the level of conservation
that is suitable to each individual operation. Producers may
adopt or maintain practices that fit into their agricultural
operation, and receive increased payments by adopting or
maintaining practices that address local priorities.Because
many of the best ideas come directly from producers, the CSP rewards
producers for developing and implementing pilot projects that further
the development of conservation practices.
The CSP contains three tiers of participation related to
the level of conservation applied. The first tier rewards
producers for implementing basic management practices, the
second tier promotes adoption of systems-based approaches to
conservation, and the third tier rewards producers for the
adoption of a comprehensive approach to conservation on a farm
or ranch. The annual payments are designed to maximize
environmental benefit under the CSP. The payments may reach
$20,000 for Tier I, $35,000 for Tier II, and $50,000 for Tier
III each year. The payments are based on a combination of
factors, including a percentage of average county rental rate
for the type of land use (cropland, rangeland, or pasture) or
appropriate average county rate for 2001 that would ensure
regional equity. For land enrolled in CSP, the legislation
provides a basic payment on enrolled land at the average county
rate. The legislation sets the payment rates at six percent for
Tier I, 11 percent for Tier II and 20 percent for Tier III. The
Committee recognizes that rental rates do not always reflect
the payment necessary to ensure participation in all regions of
the country or States, or even within regions. The Secretary
should ensure that the payments properly reflect an amount
necessary to ensure participation. Moreover, the Secretary may
use percentages of other county rates in determining the
appropriate rate. For example, the Secretary may determine that
the appropriate alternative rate is a percentage of a rate
(such as one percent of the market value of the land) to which
the 6 percent, 11 percent or 20 percent figures apply.
The annual payments include one-time advance payments equal
the greater of $1,000 or 20 percent of the annual payment for
Tier I, $2,000 or 20 percent of the annual payment for Tier II,
and $3,000 or 20 percent of the annual payment for Tier III, at
the option of the producer
In addition to receiving an average county rate payment for
enrolling land under a contract, a producer may receive bonus
payments for adopting or maintaining practices that increase
environmental benefits (including practices that address
national priority concerns) participation in research projects
and the extent to which practices exceed local priority
concerns. Beginning farmers and ranchers may also receive bonus
payments.
To best ensure that the payments supply income for
providing important environmental and conservation benefits,
producers receive all or most of the cost of practices.
Producers receive 100 percent of the costs of adopting or
maintaining management practices, 100 percent of the costs of
maintaining land-based structural practices, and 75 percent of
the cost of adopting new land-based structural practices. To
encourage increased conservation, the total of the base rate
plus costs cannot exceed 75 percent of the maximum payment
under the applicable tier. To ensure that practices focus on
land-based management practices, payments are not provided for
the cost of purchasing equipment or for waste storage or
treatment facilities. Producers may receive cost-share payments
for equipment and facilities through EQIP.
Resource Conservation and Development Councils
The Committee recognizes the important contributions RC&D
Councils, created under the Resource Conservation and
Development Program, have made to rural communities. For that
reason, the Committee permanently authorizes the RC&D program.
Additional programs
The bill also reauthorizes, through fiscal year 2006, the
Conservation of Private Grazing Land Program. The bill
authorizes two additional conservation programs, the Watershed
Risk Reduction program at $15,000,000 annually for each of the
fiscal years 2002 through 2006; the Great Lakes Basin Program
for Soil Erosion and Sediment Control at $5,000,000 annually
for each of the fiscal years 2002 through 2006.
Grassland Reserve Program
Recent years have seen large tracts of grassland being
converted to cropland or divided into smaller ranches. In
addition, a program is needed to protect small remnants of
native grassland. To encourage tracts of land to be restored to
or to remain as grassland (including prairie), the bill
requires the Secretary, acting through the NRCS, to enroll up
to 2,000,000 acres of natural grasslands.
State Technical Committees
The Committee recognizes the importance of State Technical
Committees to the administration of conservation programs at
the State and local level. For that reason, the Committee
requires an updating of responsibilities that reflect changes
made to this title, including enhanced responsibilities of
State conservationists that ensure enhanced participation by
members of the State technical committees.
TITLE III--TRADE
Food aid programs
Over the last several decades, the United States has been
the world's leading advocate of international food aid
programs. It began with massive assistance that included
donations of food to devastated European countries under the
Marshall Plan in the aftermath of World War II. The tradition
was continued with providing food aid under the mechanism of
surplus commodity disposal in Section 416(b) of the Agriculture
Act of 1949 and the Title II and Title III provisions of the
Agricultural Trade Development and Assistance Act of 1954,
popularly known as PL-480. In the 1985 Food Security Act,
Congress added the Food for Progress program as a tool for U.S.
delivery of international food assistance for economic
development and other purposes. During the 1990's, U.S. food
aid averaged about 7.5 million tons annually, more than all
other donor nations combined in most years.
Although the U.S. role in international food aid has been
substantial, the need for food assistance remains large. For
2000, USDA estimated that there were 774 million people
worldwide who were unable to meet their nutritional
requirements on a daily basis, representing an annualaggregate
gap in food assistance of as much as 17 million tons. In the face of
such need, it is important that the United States government be able to
provide a consistent amount of food aid that is not dependent on the
existence of commodity surpluses.
There is also strong demand for resources to help nourish
and educate children in the developing world. The United
Nation's World Food Program believes that there are some 300
million children worldwide who are not receiving an education
due to economic hardships faced by their families. With a
desire to address that issue, the committee establishes and
funds the International Food for Education and Nutrition
program. This proposal was introduced last year by George
McGovern and Bob Dole, former Senators and long-time advocates
of domestic and international nutrition programs. This program
is based on the simple yet powerful notion that a well-
nourished child is more likely to learn. In addition, the
availability of food is more likely to bring that child of a
poor family into school in the first place, and out of the
factories and sweat shops of the Third World.
Currently, most food aid programs are funded under
appropriations. The exception to that is the Food for Progress
program, which has averaged about $125 million annually in
recent years from the CCC to conduct development programs in
countries with emerging democracies. Under this bill,
additional mandatory funding is provided for this program, that
includes the International Food for Education and Nutrition
initiative, which nearly doubles the value of commodities that
would be available for this program.
A significant share of U.S. food aid programs are delivered
to developing countries through the efforts of U.S.-based
private voluntary organizations (PVO's) and cooperatives. Their
role is crucial in assuring the continuous flow of food aid and
development assistance to recipient countries, and their work
should not be unnecessarily hampered by excessive
administrative requirements. While recognizing a legitimate and
appropriate role for public monitoring and oversight of these
projects, the Committee urges the agencies who conduct the
various food aid programs to seek a balance that enables smooth
program operation.
The Committee believes that overall program operation would
be improved significantly if the relevant agencies devoted more
resources to timely approval of program agreements, as required
under Sections 307 and 325(i) of the bill. These provisions are
designed to limit the situations under which a major share of
eligible commodities are shipped during a relatively short time
period at the end of the year. Better spacing of shipments over
time would also reduce the bottlenecks that often occur in
commercial shipping facilities in such circumstances.
With respect to certifying institutional partners under
Sections 302, 325, and 334 of the bill, the Committee notes
that the organizational capacity of the headquarters staff of a
given eligible organization and its organizational capacity
within field offices in individual countries where projects are
conducted should be documented separately. To the maximum
extent possible, the Administrator of US-AID and Secretary
should utilize similar procedures in certifying institutional
partner status.
With respect to Section 305 of the bill, the Committee asks
the Administrator to clarify what kinds of documents are
subject to review by the Food Aid Consultative Group. While
interaction and consultation with key stakeholders is
important, the Committee recognizes that the Agency is
ultimately accountable to the nation's taxpayers for effective
use of their available funds.
The Committee notes that the 120-day review period
designated under Section 307 of the bill is longer than is
currently permitted for the U.S. Agency for International
Development (AID) to review PVO proposals. Under such a
schedule, the Committee believes that the AID Administrator
should not find it necessary to re-start the clock when seeking
additional information or clarification from the eligible
organization submitting the proposal.
Farmer-to-farmer program
The Farmer-To-Farmer Program provides short-term U.S.
agricultural technical assistance, on a people-to people basis,
to developing countries and emerging democracies worldwide. Its
purpose is ``to assist in increasing food production and
distribution, and improving the effectiveness of the farming
and marketing operations of farmers.'' The program was
established in the Food Security Act of 1985, and has utilized
the volunteer efforts of tens of thousands of farmers and other
Americans over the years of its operation. Funding provided for
the program has increased steadily from its initial level of
0.1 percent of Title I and Title II funds, up to 0.5 percent in
the current title.
The Committee urges the President to give priority with
available additional funding under Section 313 of the bill to
initiating new projects in African and Caribbean Basin
countries under this program, making use of the farming
knowledge of African-American farmers in this country for such
projects.
Commercial export programs
Over the last few decades, the U.S. agricultural economy
has derived between 20 and 30 percent of its gross income from
exports. While it has been demonstrated in recent years that
export markets do not serve as a fully reliable safety net,
trade is and will continue to be a key outlet for U.S.
agricultural products.
U.S. agricultural exports have exceeded U.S. agricultural
imports since the late 1950's, generating a surplus in U.S.
agricultural trade. This surplus helps counter the persistent
deficit in nonagricultural U.S. merchandise trade. The U.S.
agricultural export surplus narrowed in recent years from its
peak in fiscal 1996. However, it began to expand again in 2000
as exports rose in response to the recovery from the 1997-99
financial crises. In order to maintain healthy market shares
for the wide range of agricultural commodities we now enjoy, it
is important that Congress preserve and strengthen its export
promotion programs, within the commitments made in the Uruguay
Round Agreement on Agriculture.
Historically, the bulk commodities--wheat, rice, coarse
grains, oilseeds, cotton, and tobacco--accounted for most U.S.
agricultural exports. However, in the 1990's, as population and
incomes worldwide rose, U.S. exports of high-value products
(HVP)--meats, poultry, liveanimals, meals, oils, fruits,
vegetables, and beverages--expanded steadily in response to demand for
more food diversity. In fiscal 1991, HVP exports exceeded exports of
bulk products for the first time. Since then, HVP exports have
continued to exceed bulk exports, even in years of decline. The market
promotion programs, specifically the Market Access Program and the
Foreign Market Development Program, have been extremely helpful in
achieving the recent gains in HVP exports. Both programs have
experienced declining funding levels in real terms in recent years, and
this bill provides additional resources to conduct both programs. Given
the desire to encourage exploration of new export opportunities,
priority in distributing the added funds made available to both
programs in this bill will be given to proposals by new groups and for
projects in emerging markets.
In a further effort to support the USDA's primary export
objective of increasing the U.S. share of world agricultural
trade, particularly for processed foods, the Committee suggests
that the Secretary establish a permanent program for the
Quality Sample Program (QSP). The QSP is designed to encourage
the development and expansion of export markets for U.S.
agricultural products, under the authority of the CCC Charter
Act. On a pilot basis, QSP funds have been used to assist U.S.
entities in providing product samples to potential foreign
importers to promote a better understanding and appreciation
for the high quality of U.S. agricultural products.
USDA's export credit guarantee programs have been solid
tools for promoting U.S. agricultural exports over time, and
were particularly effective during the economic recession in
East Asia in the late 1990's. In particular, South Korean use
of the GSM-102 program for purchasing U.S. commodities jumped
from $14 million in 1997 to $1.38 billion in 1998 as the
country's economy weakened, thus limiting loss of U.S.
agricultural exports. The Committee notes that USDA's export
credit guarantees have been utilized to promote exports of $3
billion over the last few years. While this is a very
significant level of exports, it is well below the current
statutory minimum for the program of $5.5 billion.
The Committee urges USDA to aggressively utilize GSM export
credit guarantees in accordance with law to maximize the
program's effectiveness and enhance the export opportunities
for U.S. farm products. In addition, the Committee requests
that USDA evaluate and implement a program to reduce the fees
charged under the GSM programs. USDA should continue to work
with exporters and U.S. banks that utilize the program to
examine and implement these and other initiatives to strengthen
the GSM programs and build usage.
Under Section 321, the bill increases from six months to 12
months the authorized tenor for guarantees under the Supplier
Credit Guarantee Program (SCGP). The SCGP provides guarantees
for short-term loans extended directly from U.S. exporters to
foreign purchasers. Farm and commodity organizations indicate
that limiting SCGP tenors to only 180 days significantly limits
the program's effectiveness in assisting U.S. agricultural
exporters. Extending SCGP guarantee tenors will strengthen the
program and assist exporters to expand markets for U.S. farm
products.
In recent years, USDA has taken action to increase the
guarantee coverage level under the SCGP from 50 percent to 65
percent of the transaction value. This initiative increased
usage to the benefit of U.S. exports. The Committee suggests
that USDA work with the industry to implement further increases
in the guarantee coverage to make this export tool even more
effective.
According to a USDA study, between April 1995 and September
2000, the U.S. dollar appreciated 42 percent relative to
currencies of major exporter competitors. The study found that
appreciation of the dollar has been a major factor in the
recent decline of U.S. market share of agricultural exports.
Although some of that shift in the relative value of the dollar
in recent years resulted from changing global macroeconomic
conditions and general fiscal and monetary policy in other
countries, in some instances exchange rates were altered due to
deliberate policy actions on the part of governments of
competing exporters. By broadening the definition of an unfair
trade practice, Section 323 of the bill allows the Department
to respond to such actions through use of existing export
programs.
Exporter Assistance Initiative
Currently, there is no single information resource
available for those wishing to export agricultural products.
USDA offers certain information on-line for those wishing to
export agricultural products, however, the information is not
comprehensive and does not incorporate information under the
jurisdiction of other governmental departments or agencies. For
example, for a dual-use product such as fertilizer, there may
be restrictions on sales to certain buyers administered by the
Bureau of Export Administration. Such vital information is not
currently provided on the USDA website.
Exporters often need access to information quickly as well
and lack the time to search multiple sources to access
necessary information. And, in many cases, exporters are
unaware of where the necessary information can be located. A
USDA website would be developed under Section 326 that collates
all information from all agencies of the Federal Government
that is relevant to the export of agricultural products.
Biotechnology Education Initiative
The purpose of this program is to enhance foreign
acceptance of agricultural biotechnology and to protect US
export interests. The Committee believes that action should be
taken to address the continuing and increasing market access,
regulatory and marketing issues facing U.S. agriculture in
agricultural biotechnology trade.
Within the program established in Section 333, the
Committee also recommends the creation of a science, regulatory
and policy exchange to allow U.S. and foreign scientists,
regulators, trade officials and other policy decision-makers to
share ideas and approaches to biotechnology. This action would
enhance the dialogue between the U.S. and foreign officials
through U.S. missions to foreign countries and by hosting
foreign groups to the United States. Such an exchange also
allows U.S. and foreign officials to participate more
effectively in various international forums concerning
biotechnology (e.g., Codex Alimentarius, Bio-safety Protocol,
World Trade Organization, etc.)
Agricultural trade with Cuba
While Cuba remains a cash-poor economy, it does represent a
market that imports a substantial share of its food, with
average value of $660 million annually between 1995-99. In
particular, it is a significant buyer of rice, and prior to the
imposition of sanctions in the 1960's, was the single largest
market for U.S. rice.
A February 2001 report by the U.S. International Trade
Commission estimates that in the absence of effective
sanctions, Cuba could buy as much as 400,000 tons of wheat,
300,000 tons of rice, and 500,000 tons of feed grains from the
United States. The Commission estimates that U.S. exports to
that country could reach about $400 million annually. By
eliminating the restriction on private financing of sales of
food and medicine in current law, Section 335 of the bill
permits U.S. exporters to begin to access this market, without
committing U.S. government funds to such an effort.
TITLE IV--NUTRITION
Subtitle A--Food Stamp Program
Background
Representing the largest of the Federal nutrition programs,
the Food Stamp Program mainly assists children (50 percent)
single-parent households with children (40 percent), older
Americans (10 percent), and Americans with disabilities (10
percent). Most of the other participants, including single-
parents, are individuals in working families.
The Food Stamp Act authorizes a Food Stamp program for the
50 States, the District of Columbia, Guam, and the Virgin
Islands. Food Stamp program rules are generally uniform but
major revisions to the law in 1996 and 1997 significantly eased
Federal controls on how States administer the program. The Food
Stamp program depends, for the most part, on Federal funding.
Federal appropriations pay for almost all benefits and roughly
half the cost of administration and work/training activities
for recipients, and States carry the remaining administrative
and work/training expenses and the cost of some benefits. At
the State and local level, the program is administered by the
offices that run other public assistance programs; they are
responsible for determining eligibility, calculating and
issuing benefits, and operating or arranging for work/training
programs for recipients.
Applicants for food stamps must have their eligibility
determined, and, if eligible, their benefits are issued, within
30 days of application--or seven days if they are very poor.
The food stamp ``assistance unit'' is a household, typically
those living together who also purchase and prepare food
together. Eligibility depends primarily on whether a
household's cash income and liquid assets fall below Federal
limits. For most, the income test confines eligibility to
households with monthly total cash income at or below 130
percent of the Federal income poverty guidelines, adjusted for
inflation and household size. For fiscal year 2001, this income
limit is $1,848 a month for four persons in the 48 contiguous
States, the District of Columbia, Guam, and the Virgin Islands.
The liquid asset limit is $3,000 for the elderly and $2,000 for
all other applicants. Certain assets do not count toward the
limit. Most notably, when determining financial eligibility for
the Food Stamp Program, an individual is allowed to exclude up
to $4,650 to cover the fair market value of a household's
vehicle and States may elect to use their TANF rules governing
excluding vehicles as assets if they are more generous.
Nonfinancial eligibility criteria include those related to
work, citizen and student status, and institutional residence.
Unless exempted, most 18-50-year-old able-bodied adults without
dependents are denied eligibility if, during the prior 36
months, they received food stamps for three months without (1)
participating in a workfare program or (2) working or engaging
in a work/training program for at least 20 hours a week. In
addition to this new rule added by the Personal Responsibility
and Work Opportunity Reconciliation Act of 1996, work
requirements include a directive that most unemployed able-
bodied adult recipients not caring for very young children meet
various work-related conditions of eligibility, such as
searching or training for a job or doing public service work,
and bar eligibility to those who voluntarily quit a job or
significantly reduce work effort. States may, at their own
expense, provide food stamps to persons made ineligible by the
work rule for 18-50-year-old adults without dependents and to
noncitizens who are ineligible for Federally financed food
stamps.
Eligibility rules governing noncitizens greatly restrict
their participation. Under the 1996 welfare reform law, most
noncitizens were made ineligible for Federally financed food
stamp benefits; illegally present aliens and non-immigrant
aliens were already ineligible. Only a few categories of legal
immigrants were left eligible: those with long U.S. work
histories covered by Social Security, veterans and active duty
military personnel and their families, and refugees and asylum
seekers for five years after entry. Effective in late 1998,
P.L. 105-185 restored eligibility to several significant new
categories of legal immigrants: noncitizen children, who had
entered as of August 22, 1996, as long as they are children;
the elderly who were in the U.S. legally and age 65 as of
August 22, 1996, the disabled who were in the U.S. as of August
22, 1996, refugees and asylum seekers for seven years after
entry, and Hmong refugees from Laos and certain Native
Americans living along the Canadian and Mexican borders.
Food stamp monthly benefits averaged $72 a person or about
$170 a month for a typical household in fiscal year 1999.
Benefits are inflation-adjusted each year, and vary with the
type and amount of income, household size, and some nonfood
expenses (e.g., high shelter costs, child support payments,
dependent care expenses). They are provided monthly, and,
except for very poor recipients, monthly food stamp benefits
are not intended to cover all of a household's food costs. To
determine monthly benefit allotments, a household's total cash
monthly income is first reduced to a ``net'' income figure by
allowing a ``standard deduction'' of $134 a month and
additional deductions for certain expenses.
Food stamp allotments equal the estimated monthly cost of
an adequate low-cost diet, as determined by USDA, less 30
percent of monthly net income. Food stamps are expected to fill
the deficit between what a household can afford for food and
the estimated expense of a low-cost, adequate diet. In fiscal
2001, the maximum monthly benefit in the 48 contiguous States
and the District of Columbia was $434 for a four-person
household. Food stamp benefits also may beused for some
prepared meals and monthly allotments may be spent in approved stores
for virtually any food item--except alcohol, tobacco, or ready-to-eat
hot foods.
Benefits have historically been issued as paper
``coupons.'' However, food stamp recipients in all or part of
some 40 States and the District of Columbia now receive their
benefits through ``electronic benefit transfer'' (EBT) systems
and all States are expected to issue food stamp benefits
through EBT systems by 2002.
Variants of the regular Food Stamp Program operate in
Puerto Rico, American Samoa, and the Northern Mariana Islands.
Puerto Rico's Nutrition Assistance Program provides 75 percent
of its benefits by EBT and 25 percent in cash. Until September
2001, only cash was distributed. The annual block grant to the
Commonwealth pays for all benefits, half of administrative
expenses, and some work/training initiatives. The programs in
American Samoa and the Northern Marianas also are limited
grants, each funded at about $5 million a year. They are not
cash assistance programs and are roughly similar to the regular
program, although American Samoa's program is limited to the
elderly and disabled and the Northern Marianas' program has
special rules directing the use of some benefits to local
products.
Purpose and Need
Enrollment in the regular Food Stamp Program is responsive
to changes in the economy, food stamp eligibility rules,
administrative practices, and participants' perceptions about
their eligibility for the Food Stamp Program and other public
assistance programs. All-time peak participation in the program
was 28 million in 1994. Since then, enrollment has declined
continuously to a level of 16.9 million people in July 2000.
While the rate of decline in food stamp enrollment has slowed
recently, the total caseload is now at the lowest point since
the late 1970s. By the mid-1990s, U.S. Department of
Agriculture (USDA) studies indicated that about 71 percent of
those eligible for food stamps actually participated, but this
number had dropped to approximately 59 percent in 2000.
Simultaneously, there has been a dramatic rise in reliance in
emergency feeding sites like soup kitchens and food pantries.
The Committee has reaffirmed that the Food Stamp Program is
essential to transition from welfare to work. The new
legislation strives to ensure a smoother transition from
welfare to work; simplify program rules; provide the States
with additional options, and more standardized benefit and
eligibility rules that will make it easier for administrators
and applicants and recipients; reform the quality control
system used to evaluate States' performance; improve outreach
efforts to make sure that people who qualify for the program
are able to participate; extend benefits to certain groups made
ineligible by welfare reform; and maintain the integrity of the
program to ensure a nutrition ``safety net'' and a reduction in
waste and abuse. A key priority for this legislation is the
overarching goal of ensuring the Food Stamp Program fulfills a
major role in supporting the working poor.
In sum, the following were the goals that drove the
revision to the Food Stamp Act: (1) to institute policies that
will help participants effectively transition from welfare to
work; (2) to simplify program rules and improve outreach
efforts; and (3) to strengthen program benefits, including
restoring benefits to all poor children.
Simplified definition of income
A number of studies found that overly complex application
forms were interfering with eligible families' access to food
stamps. Questions about obscure forms of income, such as the
proceeds of selling blood plasma or garage sales contribute to
the length and complexity of many States' forms. This provision
responds to that problem by allowing States to eliminate
consideration of any types of income they do not consider when
judging eligibility for TANF cash assistance or those required
to be covered by Medicaid. It does not include items that are
included in the definition of income but part of which are
disregarded for the purposes of TANF and Medicaid by State
agencies. This should help States limit the questions on their
application forms to items that significantly affect families'
ability to purchase food. Some States have already exercised
their discretion under Medicaid and TANF to do this.
The Department is authorized to issue regulations
preventing other types of income from being excluded to prevent
distortion of the food stamp benefit.
Encouragement of payment of child support
Current law gives non-custodial parents who have child
support orders a deduction from income for benefit calculation
for the amount of money they pay in child support. This
recognizes that money paid to support a child in another
household is not available to purchase food for the non-
custodial parent's current family. It also rewards the
responsible behavior of non-custodial parents who make support
payments. This provision allows the States to exclude
completely from food stamp income calculations any child
support payments made by a household member for a child in
another family. Thus, when determining a household's
eligibility (not just benefits), a food stamp office can
disregard any money withheld from a worker's paycheck to meet
his or her child support obligations. This is also a
simplification of current procedures.
Increase in benefits to households with children
This section makes the Food Stamp Program more responsive
to the needs of larger households by making benefits sensitive
to household size. When a household applies for food stamp
benefits, the State agency must assess its income and expenses.
After determining income, all households--regardless of size--
are given a ``standard deduction'' of $134 before determining
what other expenses the household experiences. The notion is
that the first $134 of income that a household has is not
available to purchase food. In fact, larger households are
typically more poor, often because they are stretching the same
limited income across more people. In addition, extremely poor
people are often unable to afford their own apartments and have
to double-up with friends and relatives. Families in these
situations often have to apply for food stamps as one
household. In addition, since the Federal poverty line rises
each year to adjust for increases in inflation, so too would
the standard deduction. This is a significant improvement over
the current standard deduction, which has been frozen since
1995. Prior to 1995, the standard deduction did increase each
year with the Consumer Price Index.
Simplified determination of housing costs
To determine eligibility and benefit levels in the Food
Stamp Program, States must collect information about shelter
costs. Some States seek documentation from households breaking
out the composition of their monthly payments to their
landlords. The purpose of these requests is toidentify any
amounts that may be disallowed when calculating the excess shelter
deduction. This provision should eliminate that administrative burden
by providing that any payments made to the landlord will be allowed as
shelter costs without regard to whether they are itemized for these
other costs.
The Committee's proposal also simplifies the provision in
current law concerning the treatment of homeless households'
occasional shelter expenses. Unfortunately, these payments--to
operators of single-room occupancy hotels, to friends with
spare basement rooms, etc.--are almost impossible to verify
because they occur so irregularly and informally. Yet failing
to give these households any deduction for these costs would
result in an overestimate of the amount of money they have
available to purchase food. Accordingly, legislation from the
early 1990s (and refined by the 1996 welfare law) provides that
States may offer these households a $143 deduction for these
costs. The current statute is ambiguous, however, about the
relationship between this deduction and the regular shelter
deduction. The statute should make clear that homeless
households may claim this $143 deduction when they cannot
verify sufficient housing costs to obtain a larger shelter
deduction.
Simplified utility allowance
States complain that the food stamp shelter deduction is
unnecessarily complex. A significant part of this complexity
involves the rules for calculating households' utility costs.
Current law seeks to simplify these determinations by allowing
States to use Statewide estimates called standard utility
allowances (SUAs) instead of determining each household's
actual utility costs. The current law imposes limitations on
when the SUA may be applied, which undermines the State's
capacity to simplify the calculation of the deduction. One
rule, which is eliminated in this section, requires the SUA to
be pro-rated or disallowed if an eligible family is doubled up
with another individual or family that is not getting food
stamps or that is getting food stamps separately because it
buys and cooks its own food. Another rule, which will be
eliminated in this section, prohibits granting the SUA to
certain households in public housing whose utility costs are
partially covered by the housing authority. Although neither of
these rules affects large numbers of households, they increase
the complexity of the procedures States must teach their
eligibility workers and the instructions they must program into
their computers.
Simplified procedure for determination of earned income
One of the most difficult things for households to verify
is earned income. Low-wage workers who do not have access to
multiple pay stubs may have difficulty obtaining food stamps.
Even if the household can submit all of the required pay stubs,
the eligibility worker may require a letter from the employer
or may insist on contacting the employer's payroll department
to resolve ambiguities. This may cause households to withdraw
their applications rather than allow their employer to know
that they are receiving food stamps. Under current law, States
must convert the earned income of a household that is paid
weekly or biweekly into a monthly figure. States report that it
is often difficult to tell the difference between biweekly and
semi-monthly pay schedules and many low-wage workers may not
know themselves whether they are paid biweekly or semi-monthly.
Eliminating the distinction between biweekly and semi-monthly
income will allow States to reduce their verification demands
on low-wage workers without risking quality control (QC)
errors. In so doing, it may make the Food Stamp Program a more
effective support for low-income working families.
It is unlikely that most States will have the capacity to
determine how much to adjust the earned income deduction to
offset the cost of converting weekly and biweekly income to
monthly amounts in this simplified manner. Some households are
paid monthly or semi-monthly; other households have self-
employment income that may be averaged over several months or
anticipated a month at a time. States are unlikely to have good
data on what proportion of their caseloads consist of these
types of households (or others for which the new conversion
procedures would have no cost). The Department should provide
States with guidance or a simple rule of thumb by which they
may determine the amount by which the earned income deduction
can be adjusted.
Simplified computation of deductions
Current food stamp rules have provisions that lead States
to require households to report changes in their circumstances
that affect deductions from income and benefits. In addition,
States may not disregard reported changes. In both cases,
constantly changing circumstances can lead to erroneous benefit
decisions for which States are penalized. This section allows a
State to decide that it generally will address changes in
households' deductions and circumstances when it undertakes
full eligibility review (within 12 months for most
individuals), without being penalized.
Simplified definition of resources
Food stamp application forms are often unnecessarily
lengthened by questions about ownership of assets that few
household own and that States disregard when determining
eligibility for TANF cash assistance and Medicaid. If States
are able to exclude these types of resources from consideration
in all three programs, it is more likely they can remove
questions about them from common application forms. To guard
against abuse, USDA is required to specify, by regulation,
those types of resources that are so essential to equitable
determinations of eligibility for food stamps that States are
not permitted to exclude them regardless of the States'
policies in TANF and Medicaid.
Alternative issuance systems in disasters
The Food Stamp Act gives the Secretary of Agriculture broad
authority to provide emergency food stamp assistance to victims
of floods, hurricanes, earthquakes, fires, and other disasters.
The Secretary typically dispenses with many of the usual food
stamp eligibility requirements and application procedures to
help those in emergency need quickly. Historically, this has
been done by issuing paper food stamp coupons to disaster
victims. With nationwide implementation of electronic benefit
transfer (EBT) expected within the next couple of years,
however, paper food stamp coupons will no longer exist. In some
instances, EBT may be an impractical way to provide aid when it
is needed most. This proposal allows the Secretary to consider
other means of delivering assistance, including cash if
necessary, where EBT is not a feasible benefit delivery system.
State option to reduce reporting requirements
Regulations the Secretary of Agriculture promulgated in
November of 2000 allow States to use semi-annual reporting for
households with earnings, but not for those without earnings.
Semi-annual reporting reduces burdens on households and States
and, to date, thirteen States have either adopted semi-annual
reporting or are seriously considering it. Some States,
however, have been reluctant to adopt semi-annual reporting
because they want most of their caseloads to be under a single
reporting system. This section extends the semi-annual
reporting option to all households except the few that the Food
Stamp Act exempts completely from periodic reporting to prevent
undue hardship: homeless households, migrant and seasonal
farmworkers, and households in which all adults are elderly or
disabled and have no earnings. Like the semi-annual reporting
option under USDA's regulations, this statutory option requires
a household subject to semi-annual reporting to notify the food
stamp office if its income exceeds 130 percent of the poverty
line, which is the Food Stamp Program's gross income
eligibility limit.
This provision essentially codifies the Department's
current policies for quarterly reporting and semi-annual
reporting and allows States to extend those policies to the
majority of their caseloads. In so doing, it would extend to
these newer forms of periodic reporting the same protections
currently provided in statute and regulation in monthly
reporting. In one respect, some clarification may be needed in
the Department's regulations. This involves periodic reporting
for households on Indian reservations. Because of limited mail
service on many reservations, current law allows households on
reservations an extra month in which to submit their report
forms. Unfortunately, this has been interpreted to require
States to assess claims for over-issuances against households
when the submitted report form indicates a reduced need for
assistance. This results in an undue burden on working
households with variable income as well as on the State
agencies in these States. The Committee expects that the
Department will promptly clarify this policy so that no
household is treated as having been overissued food stamps if
it returns its report form by the extended deadline provided in
the statute.
Benefits for adults without dependents
The current law related to benefits for able-bodied adults
without dependents is extremely complex. Under current law,
this group of people may receive up to three months of food
stamps within any 36 month period, without working. An
individual who has exhausted all three of those months can
potentially re-qualify for an additional three months by going
through a complex reconstruction of work hours over an extended
period of time. In addition, individuals subject to the three-
month time limit are required to report some types of changes,
but not others, that might affect their status and failure to
make a required report could be prosecuted as food stamp fraud.
If a quality control reviewer reaches a different conclusion
about a determination than the eligibility worker did, the
worker will be assessed an error. Six months represents a more
reasonable period of time in which to find and keep a job. The
Committee's provision makes clear that an individual who has
exhausted her or his six-month eligibility period can re-
qualify by working or entering a work program.
In addition, current law allows recipients participating 20
hours per week in employment or training programs to receive
food stamps without regard to the time limit but rules out job
search and job search training programs as counting as an
acceptable employment or training program. The only programming
most States may offer this population in any substantial
quantity is job search or job search training. Since welfare
reform, these types of programs are well known and virtually
all States are currently operating them in conjunction with
their cash assistance programs. Allowing intensive job search
programs that meet standards established by USDA will produce
more work slots for persons subject to the time limit and can
also help people actually become employed.
Preservation of access to electronic benefits
Current Federal rules allow States to take households'
benefits off-line if the household does not use its electronic
benefit transfer (EBT) card for three months. The household
then can only use its benefits if it contacts its eligibility
worker to have the benefits reinstated. About half the States
have taken this option. After an EBT account has been inactive
for 12 months, the unused benefits are permanently expunged.
About one-fifth of all elderly and disabled recipients get the
$10 per month minimum or some other modest food stamp benefit
and are accustomed to saving up several months of benefits so
they can spend their food stamps in a single shopping trip.
They may do this because the monthly benefit is so small or to
avoid the stigma of being seen shopping with a food stamp EBT
card. If benefits are taken off-line, some recipients do not
understand how to reactivate benefits or assume they are no
longer eligible.
This legislation prohibits States from taking recipients'
EBT accounts off-line unless the account has been inactive for
approximately six months. If a State does take the account off-
line, it is required to send the household a notice informing
it how to reinstate those benefits and offering assistance to
households having a difficult time accessing benefits.
The Committee is interested in seeing that new food
retailers or retailers implementing new systems in an EBT
environment are provided the opportunity to test their systems,
using test cards provided by States, before going on-line.
Towards this end, the committee encourages FNS to continue to
work with States to have them provide this service. Minimally,
as States develop or contract for new EBT systems, the
Committee expects this ability to be built into those new
systems and contracts, and then expects the States to provide
this service.
The Committee is interested in seeing that the risk to
retailers is mitigated when the EBT system is down and the
retailer uses a back-up system. It is the sense of this
Committee that retailers should have the ability to recover the
remaining balance in a household's account when that remaining
balance proved to be insufficient to cover the entire
transaction that was stored for later submission. It is
understood in these situations that the transaction would have
been otherwise approvable. Towards this end, the Committee
supports the actions being taken by the Food and Nutrition
Service to ensure that this is an option available for States
and retailers.
Cost neutrality for electronic benefit transfer systems
The Food Stamp Act requires all States to issue food stamp
benefits through electronic benefit transfer (EBT) systems by
October 1, 2002. To date, some 43 States have EBT and 80
percent of food stamp benefits are issued electronically. A few
States, however, appear to be lagging. USDA reports that some
of these States have had difficulty obtaining an EBT vendor
because ofthe requirement in current law that EBT systems not
cost the Federal Government more than the prior paper issuance systems
did. These States operate efficient, economic food stamp coupon
issuance systems and EBT systems that might meet the cost neutrality
requirement in other States are too expensive for them.
This section eliminates the formal EBT cost-neutrality
requirement from the Food Stamp Act. In so doing, the Committee
is accepting the Department's assurances that it will remain
vigilant to ensure that costs do not rise inappropriately.
Because EBT contracts are subject to the Department's approval,
this change should not be interpreted as an invitation for
vendors to increase the prices they charge the program.
Alternative procedures for residents of certain group facilities
Food stamp benefits for residents of group homes generally
serve to subsidize the cost of meals in these facilities since
the residents generally do not purchase or prepare food
individually. Determining an individual's benefit within this
type of setting is extremely complex. This proposal allows for
the use of the standard monthly benefit in homes and centers
for every full month during which a recipient was in residence
and would have those benefits pro-rated based for partial
months of residence. The administration of the group home or
center is recognized as the authorized representative of the
residents. Upon leaving the group home or treatment center, the
recipient will again receive food stamp benefits directly.
During the month he or she leaves the home or center and the
following month, the resident can receive food stamps based on
the same standardized allotment that was paid to the facility
when he or she was in residence. As soon as the former resident
reapplies for food stamps, his or her benefits will be based on
typical food stamp rules.
This provision simplifies the administration of the Food
Stamp Program for State agencies and group home and center
administrators alike. In exchange for this simplification,
however, this provision requires the home and center
administrators to take steps to help residents to continue to
receive food stamps upon moving out of the facility. They
should be required to provide forwarding addresses for departed
residents to the food stamp office when possible. Homes and
centers should not receive food stamps for any part of the
month when the facility is not providing meals to the
recipient. This provision should not be construed as limiting
the ability of eligible individuals who have left a facility to
receive food stamps under the usual rules.
It should be noted that the Department's regulations
correctly limit the definition of an institution to a place
that provides the majority of meals to its residents. The new
group home and center procedures do not apply to a facility
that does not regularly provide most of its residents' meals.
Availability of food stamp program applications on the Internet
Working families, in particular, find it very difficult to
apply for and obtain food stamps. One simple way to make
applications available is by requiring that States with a
website post electronic applications on their site, which may
be downloaded at libraries, community centers, and other
locations. This provision only requires that States post the
application in each language in which they already make printed
applications available. This represents an extension of service
that is already available. People can obtain applications by
mail and can begin to fill them out before they walk into the
food stamp office. This allows them to collect all of the
information they might need ahead of time and saves time at the
food stamp office.
Simplified determinations of continuing eligibility
In benefit programs like Medicaid, the Supplemental
Security Income (SSI) Program, and Social Security, the
administering agency determines when it needs to conduct a
review of the recipient's circumstances and asks the person to
provide information or to appear at its office. Recipients who
do not appear or cooperate in the review, have their benefits
terminated. The initiative is up to the administering agency,
which retains substantial flexibility in scheduling and in
determining which elements of eligibility merit review. Current
food stamp rules, by contrast, require recipients to apply for
recertification after a specific number of months fixed at the
time she or he last applied. Furthermore, States are required
to conduct reviews of households whose circumstances they
already know well, and they are required to review all areas of
eligibility (since the household is treated as a new applicant)
rather than just those that seem potentially problematic.
This provision retains the same 12-month (24 for the
elderly and disabled) limit on the intervals between
redeterminations of households' eligibility that are found in
current law, which ensures that States stay in touch with all
those receiving benefits. It differs from current rules,
however, in that it does not require the State to schedule each
redetermination far in advance. It thus gives States greater
discretion to manage their caseloads by replacing the food
stamp recertification process with the redetermination process
used in other benefit programs.
The current recertification process was designed before the
present food stamp quality control (QC) was established. With
States distributing food stamp benefits funded entirely by the
Federal Government, Congress was concerned that States would
approve an initial application and then simply leave the
household on the program indefinitely without bothering to
determine whether the recipients remained eligible. Today, the
food stamp QC system imposes fiscal sanctions on States with
high error rates. States can no longer afford to neglect
households' continued eligibility for benefits.
Clearinghouse for successful nutrition education efforts
Nutrition education in the Food Stamp Program is highly
recommended but not required. Furthermore, a State that decides
to conduct nutrition education through the program must use
administrative funds, subject to a 50-50 State-Federal match.
As a result, some States do not engage in nutrition education
and, among the States that do, there is wide variability. In
some cases, posting posters or making available a brochure is
considered to be nutrition education. This provision allows
States that have good models of successful nutrition education
programs to share them with other States. This will save States
time and money in designing a program and may serve to
encourage more States to engage in nutrition education.
In an effort to further promote nutrition education, the
Committee encourages the Secretary to use such funds as deemed
necessary to promote healthy nutrition over the life of the Act
through the use of the Food Guide Pyramid stressing the
following areas: (1) Making the Food Guide Pyramid a component
of nutrition education and also make publications, specifically
forrecipients of Federal supplemental feeding programs
including the WIC and food stamp programs; (2) Developing a Food Guide
Pyramid lesson plan for use in elementary school health or physical
education classes, or any class that might incorporate nutrition as one
of its topics; (3) Making available Food Guide Pyramid posters and
pamphlets to physicians' offices as well as recreation and child care
centers, cafeterias, and classrooms; and (4) Encouraging private retail
food outlets to mount and distribute Food Guide Pyramid posters and
pamphlets.
The Committee is aware of ongoing efforts at the State
level through the Food Stamp Program to conduct nutrition
education activities that reach large numbers of Food Stamp and
similar low- income households as they transition from welfare
to work and self-sufficiency. To expand such efforts the
Committee encourages their State plans to promote achievement
of the Dietary Guidelines for Americans statewide and in lower
income communities. Social marketing may include but is not
limited to: public service and paid advertising; public
relations; promotions; education; public and private
partnerships; policy, systems and environmental change;
community development; media advocacy; and consumer
empowerment. The Committee also recognizes the need to leverage
funding for such purposes and encourages utilization of direct
and in-kind contributions on a 50/50 basis as part of State
Administrative Expenses.
Transitional food stamps for families moving from welfare
This section builds on regulations USDA published in
November 2000 (not yet in effect) that give States the option
to continue food stamps for three months to families leaving
cash assistance without requiring the family to submit any
additional information. The majority of families leaving the
welfare rolls still have low incomes and remain eligible for
food stamps. Nonetheless, States often require them to reapply
or supply new information in order to continue to receive food
stamps. Because of the pressures these families are under in
their first months off of cash assistance, many do not fully
comply and are terminated. Transitional food stamps allow the
State to continue the family's food stamps based on the
information it already has without requiring a new application.
Under this proposal, families would know that if they find
a job, their food stamps would be guaranteed to stay in place
for six months. While the family's earnings fluctuate as its
hours of work change, transitional food stamps would offer a
stable source of support to purchase food. Helping families
retain food stamps after leaving welfare for work can help make
sure that their transition is successful and can ensure that
they are better off working than they were on welfare. The
provision expands upon the Department's existing regulations.
It is designed to make it easy for the State to determine the
correct allotment for a household that is in the transitional
period: it simply freezes the household's prior benefit,
subject to adjustment for the loss of cash assistance and
certain reported changes.
Individuals who leave welfare for work and become
ineligible for full family coverage under Medicaid are
currently eligible to receive six months of transitional
Medicaid benefits. This section harmonizes Food Stamp and
Medicaid benefits for people who leave welfare.
Delivery of notices of adverse action to retailers
Sending a notice via certified mail is no longer the only
way to ensure confirmation of receipt.
Reform of quality control system
Every year, USDA requires States to audit a random sample
of more than 50,000 food stamp cases nationwide and then
estimates payment error rates for each State. The State's error
rate is the sum of the percentage of overpayments it makes plus
its percentage of under-issuances to households that receive
food stamps. States whose combined error rates exceed the
national average are subject to automatic fiscal penalties. The
amount of those penalties is calculated based on a complex
sliding scale that is designed to impose more severe penalties
on States whose estimated error rates exceed the national
average by greater margins. By definition, close to half of all
States are likely to have error rates above the national
average every year. In addition, the measurement of error rates
is subject to substantial statistical error. Thus, in any given
year, over thirty States may be either subject to penalties or
at risk of penalties if they draw an unlucky sample or if the
national average unexpectedly drops from its level the prior
year.
Because of sampling error, some States are subject to
penalties when in fact their performance--if properly
measured--is better than the national average. To avoid this
problem, this provision treats a State as having a payment
accuracy problem only if there is 95 percent statistical
confidence that the State's payment error rate exceeds the
national average by at least one percentage point. The one
percentage point margin of error, which was part of the food
stamp QC system from 1988 until 1993, helps avoid holding about
half the States liable in any given year regardless of their
performance, which is the inevitable consequence of measuring
States against the national average. It also helps prevent
states with steady performance from potentially being penalized
because of unexpected drops in the national average.
This section continues current administrative policy of
adjusting states' error rates to reflect the impact of high or
increasing shares of working poor households or immigrants
within a state's caseloads. The food stamp QC system should not
punish states that do an especially good job of serving these
vulnerable but error-prone groups--or of moving families from
welfare to work. It is the Committee's intent that the policy
of adjusting states' error rates to reflect the impact of high
or increasing shares of working poor households or immigrants
continue to be implemented for fiscal year 2001, in the same
way it was done for fiscal years 1999 and 2000.
Finally, ``enhanced funding'' has traditionally served as a
way to reward States with extremely low error rates. After
2002, this type of bonus payment is repealed but new
performance measures are rewarded under section 432.
improvement of calculation of state performance measures
For almost two decades, USDA's deadline for announcing
States' quality control (QC) error rates was June 30. As part
of legislation enacted in 1993, USDA is now required to issue
these error rates by mid-April. Reverting to the traditional
June 30 deadline will relieve State and Federal QC officials of
unnecessary pressures and allow more time to resolve disputes
and negotiate reinvestment agreements and corrective action
plans. The Department remains free to announce the error rates
in April or at any other time up until the end of June.
High performance bonus payments to States
In section 530, the Committee bill has removed enhanced
funding for States with very low error rates. However, the
Committee believes that States should be rewarded for excellent
and improved performance. This provision establishes a more
targeted payment to States that achieve the goals of the Food
Stamp Program. The section establishes one measure related to a
State's participation rate among low-income working families
and allows the Secretary, in consultation with State
organizations, to establish four additional measures of State
performance that reflect the Food Stamp Program's goals of
preventing hunger among low-income people. One of the measures
will have to assess timeliness of customer service and the
other three are to be set at the discretion of the Secretary in
consultation with the State groups within six months from the
bill's enactment.
Employment and training program
From the late 1980s through fiscal year 1996, States,
collectively, received $75 million a year of a 100 percent
Federal grant to operate FSE&T programs. States received an
unlimited 50 percent Federal match for any additional funds
they chose to spend on FSE&T (subject to a $25 per month for
every recipient cap). When the Food Stamp Program was last
reauthorized in 1996, Congress gradually increased the $75
million annual allocation so that it will reach $90 million in
fiscal year 2002.
In addition, in 1997 Congress more than doubled the amount
of unmatched Federal funds available for FSE&T (currently
running about $150 million per year) to help States meet the
cost of providing work slots to persons affected by the three-
month time limit. The Balanced Budget Act of 1997 set aside 80
percent of the total unmatched Federal funding to provide work
slots that would allow time limited individuals to continue to
receive food stamps beyond the initial 3 months. To prevent
States from substituting this new unmatched Federal money for
their own moneys that they were already expending on FSE&T, the
1997 legislation required States to meet a maintenance-of-
effort requirement before accessing the new funds it was
adding. A large share of the new FSE&T money provided in 1997
remains unspent. States have urged that the 80 percent set-
aside, the maintenance of effort requirement, and the
reimbursement rate limits be repealed. This will make the
unmatched Federal FSE&T funds available to provide services to
other food stamp recipients, primarily families with children.
Finally, the $25 per month cap is raised to $50 for
transportation and other work expenses because $25 has often
not been enough money to adequately help individuals.
Coordination of program information efforts
The Food Stamp Act prohibits States from spending TANF
funds on any activities that could be reimbursed instead as
food stamp administrative expenses. Since food stamp
informational activities are reimbursable under the Food Stamp
Act, this provision prohibits spending TANF funds on them. As a
result, States have difficulty conducting multi-program
informational activities that include food stamps. For example,
if a State wishes to inform TANF applicants and recipients
about the work support programs available to them, it may use
TANF funds to discuss child care subsidies, Medicaid, child tax
credit, etc. If the State also wishes to mention food stamps,
however, it must undertake a complex cost allocation exercise
to ensure that the correct share of those costs are charged to
the Food Stamp Program. Faced with this prospect, some States
have elected simply to exclude all mention of food stamps in
their efforts to highlight how work support programs can make
employment preferable to receipt of cash assistance. Providing
potentially eligible households information about food stamps,
and informing current recipients that they may continue to
qualify after becoming employed, is crucial. These activities
constitute such a small and isolated aspect of States'
administrative activities that allowing them to be supported
with TANF funds without cost allocation will not undermine the
integrity of the financing system the 1998 law put in place.
This provision will not allow States to use TANF money as a
match to get Federal Food Stamp money.
expanded grant authority
The authority of the Secretary to make grants and contracts
for food stamp research, which includes waivers of food stamp
rules, has been called into question. Specifically, some have
questioned USDA's ability to let grants to research
organizations working on behalf of government entities. This
provision makes clear the Food and Nutrition Services (FNS)
ability to issue grants and contracts to non-government
entities that include waivers.
access and outreach pilot programs
Improvements are needed to make sure the Food Stamp Program
is more accessible to eligible individuals and families and
that its benefits are available. For example, there have been
marked decreases in the participation by Food Stamp
participants in farmers' markets and road stands. The new
electronic benefit transfer (EBT) system has made it very
difficult to redeem food stamp benefits at these sites. USDA
will be provided with additional funds for grants that would
improve outreach and access in the Food Stamp Program. Priority
will be given to State and non-government organization
partnerships. Examples of initiatives that may receive funding
include but are not limited to: establishing a single site at
which individuals may apply for food stamps, Medicaid, SSI, and
other assistance programs; developing common forms that will
allow for one-stop-shopping; dispatching caseworkers to conduct
outreach and enroll individuals in a remote but often visited
location (like a shopping mall, community center, or food
bank); developing cost effective ways to encourage shopping in
farmers' markets, and roadside stands by Food Stamp Program
participants.
consolidated block grants and administrative funds
The Committee's provision consolidates the two nutrition
assistance grants, now in the Food Stamp Act. In order to
ensure that the grant for Puerto Rico continues to be indexed
and to grant the same status to the American Samoa grant, this
provision consolidates both grants. In addition, Puerto Rico is
authorized to spend up to $6,000,000 of its 2002 funds to
modernize computer equipment needed for electronic benefit
transfer (EBT) systems. This provision authorizes use of
administrative funds with no requirement for a 50-50 match
between the Federal government and Puerto Rico.
assistance for community food projects
Community Food Projects are designed to increase food
security in communities by bringing the whole food system
together to assess strengths, establish linkages, and create
systems that improve the self-reliance of community members
regarding food needs. The 1996 FederalAgriculture Improvement
and Reform Act (FAIR) established new authority for Federal grants to
support the development of Community Food Projects to meet the needs of
low-income people by increasing their access to fresher, more
nutritious food supplies; enhancing the self-reliance of communities in
providing for their own food needs; and promoting comprehensive
responses to local food, farm, and nutrition issues. These grants are
intended to help eligible private non-profit entities that need a one-
time infusion of Federal assistance to establish and carry out multi-
purpose community food projects. Projects are funded from $10,000-
$250,000 and from one to three years and require a dollar for dollar
match in resources.
Availability of commodities for the emergency food assistance program
The Emergency Food Assistance Program (TEFAP) supports
local emergency feeding organizations, such as food banks, soup
kitchens and shelters, churches and food pantries, by offering
donated foods to lower-income families and individuals. An
increased demand on emergency feeding facilities necessitates
an increase in TEFAP funding. According to a recent USDA study,
reported demand for food assistance at soup kitchens and food
pantries has increased by between four percent and seven
percent a year since 1997. Covering the cost of distributing
the growing amount of Federally and privately donated
commodities handled by State and local emergency food providers
is proving to be a significant problem. TEFAP funding for
distribution expenses can be used to pay for processing
(including of game meat), storage, transportation, and
distribution costs associated with both Federally and privately
donated foods. The $10 million dollar set-aside is in addition
to the regular appropriation for distribution costs authorized
under The Emergency Food Assistance Act, but it will be
allocated to States in the same manner. Note that section 163
of this bill provides up to $40,000,000 per year in additional
commodities for The Emergency Food Assistance Program.
Report on use of electronic benefit transfer systems
The Food Stamp Act requires all States to issue food stamp
benefits through electronic benefit transfer (EBT) systems by
October 1, 2002. To date, some 43 States have EBT and 80
percent of food stamp benefits are issued electronically. A few
States, however, appear to be behind schedule. This report will
provide an assessment of difficulties encountered by States in
instituting the system and will also request a report on the
extent of fraud using EBT as opposed to paper coupons. The
report will also indicate how USDA, States, retailers, and EBT
contractors are addressing problems that exist.
Vitamin and mineral supplements
The National Academy of Sciences is in the process of
reviewing and revising nutrient recommendations and is, in many
cases, recommending higher Dietary Recommended Intakes (DRIs)
for a number of nutrients for purposes of health promotion and
disease prevention. As a result, people may not be consuming
all of the nutrients they need through foods and may need to
supplement their diets. Dietary supplement intake in this
country is high (approximately 40 percent of adults consume
them). Food Stamp participants should have the ability to
purchase vitamin-mineral supplements to supplement their diets,
if they so choose. This provision limits purchase of
supplements to those containing only vitamins and minerals and
excludes herbals and botanicals. The impacts study will serve
to assess the ease with which the provision is implemented and
its consequences, including economic, nutrition, and health
impacts of implementing this provision.
The Committee does not intend that this provision be
interpreted to change the rules for approving stores as food
stamp retailers.
Subtitle B--Miscellaneous Provisions
Partial restoration of benefits to legal immigrants
Legal immigrant children who arrived in the U.S. after
August, 1996 are ineligible for the Food Stamp Program, even
though adequate nutrition is critical for this age group. By
restoring benefits to all children, food stamp eligibility
rules for children will become less complex and easier to
administer and explain. This provision also will help citizen
children whose parents are immigrants. The Congressional Budget
Office (CBO) estimates that restoring benefits to children will
help some 60,000 children in an average month.
This section suspends deeming rules for children but not
for any other group. This means that a great majority of
sponsored immigrants will continue to be unable to get food
stamps during their three years in the United States. Even if
sponsors' income and resources are low enough to allow the
immigrant to qualify, few sponsors are prepared to comply with
food stamp reporting and verification requirements.
Currently, immigrants must work (and therefore pay taxes)
at least 40 quarters to be able to participate in the program.
Sixteen quarters of work represents a reasonable amount of time
in which individuals have established a solid basis of personal
responsibility, one of the guiding principles of welfare
reform. CBO estimates that this will potentially help some
65,000 in an average month.
Under the welfare law, refugees and people who are seeking
asylum and met all other eligibility criteria could receive
food stamp benefits during their first five years in the United
States. This cap was extended to seven years in 1998. This
limit assumed that refugees and people seeking asylum could
become citizens in that period of time. Because of backlogs in
the naturalization process that is not always the case. CBO
estimates that removing the cap will help approximately 45,000
people in an average month.
Persons are only considered ``disabled'' for food stamp
purposes if they receive one of a specified list of disability
programs, like Supplemental Security Income (SSI) or veteran's
payments. The effect of this provision will be to lift an
arbitrary bar against the disabled based on their date of
entry. In effect, however, no additional people will be able to
participate in the Food Stamp Program since SSI places a strict
restriction on disabled immigrants who arrived in the U.S.
after August 1996. These individuals will only be able to
participate in the Food Stamp Program if SSI law changes.
Commodity Purchases
Schools that participate in the School Lunch Program are
entitled to a specific dollar value ofcommodities based on the
number of meals they serve, in addition to cash subsidies. The
inflation-indexed commodity entitlement is 15 cents a meal for the
2001-2002 school year. Schools and other providers also receive bonus
commodities donated from Federal stocks acquired for agricultural
purposes at the Department's discretion. Entitlement commodities must
equal 12 percent of the cash and commodity assistance provided under
the School Lunch Program, and the 15-cents-a-meal guarantee may, in
effect, be increased to meet this requirement.
Prior to fiscal year 1999, only the value of entitlement
commodities was counted toward meeting the 12 percent commodity
requirement. However, for 1999-2001, the law was revised so
that the value of ``bonus'' commodities supplied at the
Agriculture Department's discretion from already acquired
stocks also counted toward the 12 percent minimum. This
provision provides a two-year modification so that the issue
may be more fully addressed during child nutrition programs
reauthorization in 2003.
Exclusion of certain military basic allowances for housing for
determination of eligibility for free and reduced price meals
The Basic Allowance for Housing (BAH) for service members
in private housing is reflected on his or her Military Leave
and Earnings Statement even though the funding passes directly
through to the housing owner. This added ``income,'' which is
not reported for members living in traditional on-base housing,
causes many service members to lose eligibility for free and
reduced meals for their children. This provision excludes
consideration of the BAH for free and reduced price school
meals. This provision extends through 2003 to coincide with
child nutrition programs' reauthorization.
Eligibility for assistance under the Special Supplemental Nutrition
Program for Women, Infants, and Children (WIC)
The Basic Allowance for Housing (BAH) for service members
in private housing is reflected on his or her Military Leave
and Earnings Statement even though the funding passes directly
through to the housing owner. This added ``income,'' which is
not reported for members living in traditional on-base housing,
causes the loss of WIC eligibility for many women, infants, and
children in military families. This provision will prevent
counting of the BAH in WIC eligibility determination.
Senior Farmers' Market Nutrition Program
On January 4, 2001, the USDA announced the award of almost
$15 million in grants to 31 States and 5 Indian Tribal
Organizations for a new Seniors Farmers' Market Nutrition Pilot
Program (SFMNPP). Under the program, CCC made grants to States
and Indian tribal governments to provide coupons to low-income
seniors that may be exchanged for eligible foods at farmers'
markets, roadside stands, and community supported agriculture
programs. The purposes of the Seniors Farmers' Market Nutrition
Pilot Program are to (1) help low-income seniors obtain fresh,
nutritious, unprepared, locally grown fruits, vegetables, and
herbs from farmers' markets, roadside stands and community
supported agriculture programs, (2) increase the domestic
consumption of agricultural commodities by expanding or aiding
in the expansion of domestic farmers' markets, roadside stands,
and community support agriculture programs, and (3) develop or
aid in the development of new and additional farmers' markets,
roadside stands, and community supported agriculture programs.
The pilot program has been very successful. The Committee does
not intend to limit funding for the program to the $15 million
annual level, if the Department chooses to fund the program at
a higher level.
Fruit and vegetable pilot program
The purpose of the fruit and vegetable pilot program is to
determine whether or not children's diets can be improved if
they are provided with free fruits and vegetables. An
evaluation will help to determine whether or not students took
advantage of the program; whether or not interest grew or was
decreased in the program over time; and what effect, if any,
this program had on vending machine sales.
The Committee recommends that the USDA Small Farms/School
Meals Program be continued for the next two years in the four
States (Iowa, Kentucky, North Carolina, West Virginia) in which
it currently operates. This program, facilitates connections
between school food service officials, State departments of
agriculture, Cooperative Extension, and the Department of
Defense's produce procurement program with the goal of
increasing the sales of locally grown foods to school meals
programs. The merits of the program should be re-evaluated
during child nutrition programs' reauthorization in 2003.
Perhaps the program would warrant expansion at that time.
Congressional Hunger Fellowship
This section formalizes an internship program already being
carried out by the Congressional Hunger Center and funded under
annual appropriations bills, as a memorial for the Honorable
George T. (Mickey) Leland, the late Representative from Texas
and the Honorable Bill Emerson, the late Representative from
Missouri.
Nutrition information and awareness pilot program
The committee recognizes that there is a very high rate of
diabetes among Native Americans. In August, 2001, the U.S.
Department and Health and Human Services announced that proper
nutrition and exercise could reduce the risk of diabetes by 58
percent. Therefore, the committee directs USDA to take an
active role in promoting effective nutrition within those
programs utilized by Native American populations, such as the
Food Distribution Program on Indian Reservations and the School
Lunch Program, in an effort to curb the diabetes epidemic.
TITLE V--CREDIT
Consolidated Farm and Rural Development Act Lending Authority
The basic statutory authority for the farm loan programs is
the Consolidated Farm and Rural Development Act, as amended
(P.L. 87-128), which is commonly referred to as the Con Act.
The federal government's farm loan programs are operated by the
Farm Service Agency (FSA) of the U.S. Department of
Agriculture. FSA provides financial assistance to farmers and
ranchers through direct, government-funded loans and through
guarantees on loans made by commercial lenders. To obtain a
direct FSA loan, a farmer or rancher must be unable to obtain
commercialcredit at reasonable rates and terms. To obtain a
loan guarantee, a lender must certify that it is unwilling to make the
loan without a government-backed guarantee.
FSA provides various types of direct and guaranteed loans
to the nation's farmers and ranchers. For example, direct farm
ownership loans are made for buying farm and ranch real estate
and making capital improvements. Guaranteed farm ownership
loans are made for the same purposes and for refinancing
existing debts. Also, the FSA makes direct farm operating loans
for purposes such as buying feed, seed, fertilizer, livestock,
and farm equipment; paying family living expenses; and, subject
to certain restrictions, refinancing existing debts. Guaranteed
farm operating loans are made for the same purposes but without
restriction on refinancing existing debts. Additionally,
natural disaster emergency loans are direct loans made to
farmers and ranchers whose operations have been substantially
damaged by adverse weather or other natural disasters.
When a borrower has problems repaying his or her direct
farm loans, FSA has various tools to resolve the delinquency,
including: (1) rescheduling or reamortizing loan terms, which
may include changing interest rates and the repayment period;
(2) restructuring the loans, which may include reducing
(writing down) some of the outstanding debt, so that the
borrower can continue in farming; (3) allowing a borrower who
does not qualify for restructuring to pay an amount based on
the value of collateral security, which is less than the
outstanding debt and results in FSA's forgiving (writing off)
the balance; and (4) reaching a final resolution of the debt
that may or may not include a payment by the borrower, which
also results in debt forgiveness. When a borrower defaults on a
guaranteed loan and a commercial lender incurs a loss, FSA
reimburses the lender for the guaranteed portion of the loss.
Beginning farmers and ranchers
During the 1990s, Congress began to focus the farm loan
programs to emphasize assisting beginning farmers and ranchers.
The future of United States agriculture depends on the ability
of new family farmers and ranchers to enter agriculture. In
recent decades, farm entry rates have declined; in many States,
the farmer ``replacement'' rate has fallen below 50 percent.
There are twice as many farmers over 65 as under 35 years old.
Traditional methods of farm entry and farm succession need to
be augmented to meet current challenges. Many of the changes in
the credit title follow on earlier Congressional efforts and
maintain the goal of making it possible for more young people
to begin farming.
The title authorizes the Secretary to guarantee loans made
by State beginning farmer and rancher programs, which includes
loans that use funds resulting from the issuance of tax-exempt
Aggie bonds. These bonds include a qualified small issue
agricultural bond for land or property described in Section
144(a)(12)(B)(ii) of the Internal Revenue Code of 1986.
Providing a guarantee on these loans in addition to the tax-
exempt status of the bonds would encourage additional funds at
favorable terms to beginning farmers and ranchers. Under
current tax law a State-issued bond that receives a guarantee
from the U.S. government loses its tax-exempt status. Congress
has granted exceptions to this rule, including allowing the
tax-exempt bond issuance for student loans to receive a federal
guarantee. This proposal takes the first step in granting this
exception by amending the farm lending law to grant the
Secretary the authority to provide a guarantee to State
beginning farmer programs. To effectuate this exception, there
would need to be a corresponding change in the tax code.
The credit title also improves programs such as the
beginning farmer down payment program. The number of beginning
farmers participating in this program has declined over the
last several years, with 287 participating in 1998, 260 in
1999, and 142 in 2000. The down payment program for beginning
farmers is a preferred loan program. It establishes a
relationship between the beginning farmer and the commercial
lender, while the beginning farmer shares in the risk of the
transaction with the down-payment requirement. Statistics show
that beginning farmers in the down-payment program were
delinquent 1.6 percent of the time while beginning farmers in
the joint participation loan program, where both a bank and the
USDA directly lend to the beginning farmer, were delinquent 6.3
percent of the time. For these reasons, the Committee
recommends the changes made to the beginning farmer down
payment program so more beginning farmers become involved with
the program.
The down payment loan program has been an important
innovation. Nonetheless, it has been utilized more in certain
regions than others. Because of this, the Committee urges the
Secretary to establish performance goals for each State with a
significant volume of real estate loans under subtitle A, with
a goal of attaining down payment loan volumes consistent with
section 346(b)(2)(A)(i)(II) within three years of the date of
enactment of this subsection.
In another effort to increase beginning farmers' and
ranchers' access to farm land, the title increases the time
period in which a beginning farmer or rancher receives a
preference to purchase inventory farmland from the Secretary
from 75 days to 135 days and provides that the Secretary can
combine or divide parcels of inventory property to maximize
opportunities for beginning farmers and ranchers to acquire
such properties. The current 75-day time period has constrained
the actual time period in which the Secretary has offered these
inventory lands for sale to beginning farmers and ranchers.
Extending the time to 135 days ensures that beginning farmers
and ranchers have a reasonable time period in which to obtain
notice of the sale of these lands and gain financing for their
purchase. Also, allowing the Secretary to combine or divide
tracts of farmland provides additional opportunities for
beginning farmers and ranchers to acquire such property.
The title also requires the Secretary to consider selling
easements on inventory land for the purpose of farmland
preservation. By providing the Secretary the ability to sell
development rights, she possesses a greater ability to preserve
farmland that is inventory property and sold for agricultural
purposes.
As an example of innovative ways to provide assistance to
beginning farmers, the Committee directs the Secretary to
create a pilot program in which the Secretary will guarantee
loans made by a private seller of a farm or ranch to a
qualified beginning farmer on a contract land sale basis. The
Secretary will guarantee up to five loans per State in 10
geographically dispersed States per year through 2006, after
she has made a determination that this type of guarantee
involves comparable risk to current guarantees to commercial
lenders. Many farms are sold on a contract land sale basis,
which in effect makes the seller the financier of the loan.
Current law does notallow the Secretary to guarantee these
transactions. Because of tax considerations, this option may be
attractive to those farmers considering selling to a beginning farmer
or rancher.
Native American farmers
The title recognizes special situations faced by certain
farmers. For example, the title requires a 95 percent guarantee
of an operating loan made to a Native American farmer on an
Indian Reservation and allows the Secretary to waive the seven-
year term limit for direct operating loans made to Native
American farm operations on tribal lands if she determines that
commercial credit is not generally available for such
operations. Because of the special legal status of some tribal
lands, many creditors lack confidence that they will be able to
enforce security agreements and, thus, choose not to lend to
farmers on the tribal land. The result is that many Native
American farmers find it very difficult or impossible both to
find commercial credit and continue farming.
Limitation on direct operating loans
The title also provides the Secretary authority to waive
the term limitation on direct operating loans to allow all
farmers to obtain loans for two years beyond the current seven-
year limit. This change applies to all farm operations and
provides the Secretary the ability to waive the term
limitations on direct operating loans one time per lifetime for
a borrower for two years. This change recognizes that certain
borrowers that have viable farm operations may need this
extension given the low commodity prices of the past few years.
Shared appreciation agreements
In another example of adapting the law to meet changed
circumstances, the title provides those who owe recapture
amounts on shared appreciation agreements or those who have
amortized the recapture amounts, the option of providing
farmland protection easements on their land in return for
forgiveness of the recapture amount. Many borrowers who owe
significant amounts of money under the recapture provisions of
shared appreciation agreements feel pressed to sell the land to
meet the obligation. This is especially true in areas where the
land values have greatly increased because of development
pressure. This change allows farmers who want to stay on the
land to exchange the development rights for their farmland for
a period of 25 years in return for the forgiveness of the
recapture amount. With this restriction, the Committee does not
intend to discourage farmers from undertaking processing,
storage, or value-added activities on the land directly related
to the crop produced, in which other producers may take a part
to make the processing, storage, or value-added activity
economically viable for the landowner. The Secretary may define
the extent of such activities by regulation.
Low documentation loans
The title also makes using federal farm credit programs
easier for all types of borrowers. The title raises the low
documentation loan amount for a farmer program guaranteed loan
from $50,000 to $100,000. Under current law, the low
documentation loan program allows commercial lenders to
streamline the paperwork involved with qualifying for a loan
guarantee if the loan amount is $50,000 or less. This amount
has not been increased since 1992. By raising the limit to
$100,000, many more loans would qualify for this streamlined
status. In fiscal year 2000, a total of 2,707 qualified for the
low documentation program; another 3,070 would have qualified
if the limit had been set at $100,000. Raising the limit to
$100,000 is not likely to increase the delinquency rates on
these loans based on historical evidence. In 2000, loans which
qualified for the low-doc program had a delinquency rate of 4.3
percent compared to loans between $50,000 and $100,000, which
had a delinquency rate of 4.1 percent.
Interest rate reduction
In another example of improving upon successful programs,
the title makes permanent the interest rate reduction program
and provides that beginning farmers receive an additional one
percent interest rate subsidy (capped at four percent) over
non-beginning farmers (capped at three percent) who participate
in the program. The title also increases the maximum amount of
funds for this program to $750 million and provides that 25
percent of the program's subsidized funds are reserved for
assisting beginning farmers and ranchers until April 1 of each
fiscal year.
Farm Credit Act Lending Authority
The basic statutory authority for the Farm Credit System
(FCS) and for Federal Agricultural Mortgage Corporation (Farmer
Mac) Farmer Mac is the Farm Credit Act of 1971, as amended
(P.L. 92-181). These two government-sponsored enterprises
provide credit assistance to agriculture.
FCS was created by Congress in 1916 as a nationwide
financial cooperative that lends to agriculture and rural
America. Overall FCS supplies about 26 percent of the credit
provided to American farmers and ranchers and about 85 percent
of the credit provided to agricultural cooperatives. FCS
comprises six regional Farm Credit Banks and a specialized
lending bank with a national charter to finance, among other
things, agricultural cooperatives, rural utility systems, and
other rural businesses. Another key element of FCS is the
Federal Farm Credit Banks Funding Corporation, which obtains
funds for FCS to lend through the sale of bonds and notes in
the nation's capital markets. Unlike commercial banks, FCS
banks and associations do not take deposits. The debt
securities of FCS are the joint and several liability of all
the FCS banks. In addition, the Farm Credit System Insurance
Corporation, which was established in 1988, insures the timely
payment of principal and interest on FCS debt securities.
Farmer Mac was created by the Agricultural Credit Act of
1987 to promote the development of a secondary market for
agricultural real estate and rural housing loans. Farmer Mac
does this primarily by purchasing qualified loans from lenders,
thereby replenishing their source of funds to make new loans.
The Farm Credit Administration (FCA) is the independent
federal regulator responsible for examining and ensuring the
safety and soundness of FCS. FCA also regulates and examines
Farmer Mac.
Current law, adopted in 1992, authorizes Farm Credit System
lenders to purchase interests in certain loans made by non-Farm
Credit System lenders to customers who are not otherwise
directly eligible to borrow from the System. This authority was
provided to enable System institutions to better manage the
risk in their narrowly focused portfolios. The authority has
theadded benefits of providing an additional source of capital
for certain businesses and fostering partnerships between commercial
and System lenders.
These multi-lender transactions involve mostly larger
customers (i.e., businesses with credit needs large enough that
multiple lenders are needed to spread the risk among financial
institutions). Such loans are originated by commercial lenders
and then syndicated or sold to groups of lenders. For System
institutions to participate in these transactions, the loans
must involve businesses that are similar to the businesses
directly eligible to borrow from the System. In addition
current law provides limits on the volume of such loans the
System can hold (no more than 15 percent of an institution's
assets) and the percentage of the total financing package that
is made available to any one borrower (the combined total
financing from all System participating lenders must be less
than one-half of the total financing package). These
limitations ensure that commercial lenders continue to play the
predominant role in financing businesses not directly eligible
to borrow from the System.
Recognizing the growing sophistication of the secondary
market for agricultural loans, this title would increase the
number of Farmer MAC Board of Directors from 15 to 17 so as to
include two additional management directors. It also would
provide that the Board of Directors elect its chairperson.
These changes would bring the Farmer MAC Board of Directors
organization in line with other government-sponsored
enterprises such as Fannie Mae, Freddie Mac and Sallie Mae.
These changes would also recognize the sophistication and
complexity of managing the risks associated with the
functioning of a secondary market for agricultural loans and
the need for operational expertise on the Farmer Mac Board
TITLE VI--RURAL DEVELOPMENT
About 55 million people reside in Rural America, almost a
fifth of the nation's population. And, in 1997, rural areas
lagged behind urban areas by about $9,000 in real per capita
income. Earnings per job shows an even larger discrepancy:
$35,151 in urban areas compared to $23,619 in rural areas (in
1998 dollars). The Rural Poverty rate, 14.3 percent, is higher
than urban poverty, 11.2 percent (for 1999). A significant
number of counties, particularly in the upper Midwest, have
seen declining populations decade after decade, some for over a
century.
Costs for a wide variety of infrastructure per person in
rural areas are higher. That is true for transportation, sewer
systems, drinking water, electricity, telephone service, and
now broadband communications. The rural economic infrastructure
is also in many ways at a disadvantage compared to urban areas.
That may not be true for some routine financing of common
activities, but it is clearly the case for larger less common
business enterprises, and it is most clearly true regarding
equity financing, which is so important for business growth at
the beginning of the 21st Century.
The Federal Government has played a crucial role in rural
economic development from the nation's early days with the
development of canals, railroads and 1862 Homestead Act. Land
Distribution and transportation infrastructure defined rural
policy to the beginning of the 20th Century. In the 1930s, the
Congress established programs within the Department of
Agriculture for the electrification of rural America, and the
first loans for homes and businesses.
A large number of agencies of the federal government have
some programs which focus on rural economic development. But,
since the 1972 Rural Development Act, USDA has been the lead
agency for coordinating federal programs that target rural
areas. USDA programs have focused on a number of crucial areas.
Grants and loans for infrastructure development for
electricity, telephones, sewer and drinking water systems, and
most recently, support for bringing broadband access to rural
areas, have been crucial for creating the backbone that allows
businesses to exist and grow, as well as providing for an
improved quality of life for rural Americans.
Equity programs
It has become apparent in recent years that one of the
major factors limiting economic growth is the lack of equity
capital in rural America. The reasons are many. But, some
relate to distance from those with equity expertise and
resources to invest. And, some relate to the relative
expectation of profit that can be expected. For many
manufacturing, particularly value added manufacturing through
cooperative ventures, the level of profit is not considered to
be competitive to the profit potential expected in the private
equity markets. To overcome those difficulties, the Rural
Development title has included two significant equity
mechanisms that could spark considerable economic development.
The first is Section 601, establishing the National Rural
Cooperative and Business Equity Fund. This proposal was
introduced in an earlier form by Senators Harkin and Craig in
the 106th Congress and reintroduced as part of a larger measure
by Senator Daschle as a part of S. 20 at the beginning of this
Congress. The measure has enjoyed broad support within the
rural financial community, including both banking and farm
credit system organizations.
It authorizes the appropriation of $150 million in funds to
be matched by at least an equal amount contributed by private
investors. USDA will guarantee 50 percent of each investment
made by a private investor, with a maximum total guarantee of
$300 million in private investments in the Fund. Debentures
issued by the fund and guaranteed by USDA shall not exceed $500
million. The Fund will make equity and semi-equity investments
in rural businesses. Investments in retail businesses will not
be allowed. The fund will be managed by a 14 member board,
three appointed by the Secretary and 11 from the investors. The
goal is to have a board that operates in a way that has a
strong goal of increasing economic development in rural areas.
But, it will also be motivated by profit. The Board is expected
to hire a staff that fully meets the standards in quality and
quantity that is expected in the private equity investment
industry.
There is a limitation on the investment in a single
investment of no more than the greater of 7 percent of the
funds capital or $2 million. The expectation is that all of the
investments would be far smaller than 7 percent of the fund if
the fund is of a magnitude near its authorized size. The
measure allows the Secretary to waive these limits in cases
where additional funds may be necessary to preserve an existing
investment. The expectation is that the Secretary would only
grant this authority in very limited circumstances where the
need is clear and the expectation thatthe additional funding is
reasonably likely to result in a successful recovery. It is expected
that many of the investments will be in cooperative enterprises,
important to rural America although those investments often have a
lower rate of return. It is not expected that the fund will be engaged
in traditional loan activities, but there are occasions when equity
providing funds provide nonequity assistance. Section 383(a)(B)(ii) is
designed to place an absolute limit in that area.
Section 602 creates the Rural Business Investment Program
which is designed on the Small Business Investment Company
(SBIC) model. Unfortunately, SBICs have not provided the degree
of equity investment in rural America desired. The Committee
has provided several incentives beyond those provided for SBICs
to attract capital to Rural Business Investment Companies
(RBIC). These include grants to RBICs to be used to assist
entities that they invest in, and an increase in the ability of
the Secretary to provide guarantees on up to 300 percent of an
entities capital, as opposed to 200 percent. However, the
expectation is that guarantees will only be made to that level
when there is comfort with the quality of the RBIC. RBICs are
designed to provide equity type investments to rural small
businesses and are not intended to directly compete with
conventional rural lenders. As a result, the Secretary shall
prohibit an RBIC from making a loan to an eligible entity
unless one or more banks have declined the entity for a loan.
Since the Small Business Administration has considerable
experience with equity firms receiving government support, it
is in the Government's expertise to fully use that resource.
The Secretary is expected to maintain policy controls, within
the intent of the law, regarding both equity provisions; but
the expectation is that the professional staff of the SBA will
make judgements where delegated and otherwise provide
recommendations in regard to financial issues.
Other programs
Section 603 provides the resources necessary to allow USDA
to fund the backlog of community facility, sewer, drinking
water and certain other loan and grant applications. The
provision requires that the funds in the FY 02 Agriculture,
Rural Development, FDA and Related Agencies Appropriations
measure are first used. For too long, large number of important
projects important to rural America have languished, unfunded.
This provision will allow the Department to remove this
backlog. However, this section requires that the Secretary
follow the rules that are in effect on the date of this
measure's enactment. Projects that do not meet the requirements
of those regulations will not receive support.
Section 604 establishes a Rural Endowment Program. A large
number of Rural communities lack the resources that are
necessary to attract business to provide good jobs and
necessary facilities to allow for a good quality of life for
the area's citizens.
The Rural Endowment Act provides grants for the development
of comprehensive plans for what a rural area may need to help
it achieve economic growth. The strategy would provide a road
map for loans or investments. In those cases where an
organization, governmental or non-profit has developed a
comprehensive community development strategy of considerable
quality that is likely to result in a significant improvement
in the area's ability to improve its economy and community
development, the Secretary should carefully consider providing
funds for an endowment. Endowments of up to $6 million, matched
with local funds are to be invested. And over a period of 10
years, the endowment will be used to accomplish the
comprehensive plan. Funds may be used to finance affordable
housing, infrastructure, and community facilities and economic
development projects. It is the Committee's hope that a number
of excellent successful plans will have a major effect on the
areas involved and will be models for future efforts using non-
categorical funding. It is expected that the Secretary shall
award all of the endowment funds to specific applicants in
fiscal year 2003. An additional authorization is provided for
fiscal years 2004 through 2006 if the Congress determines that
the initial experience demonstrates that this is an effective
model for economic development and the resources are available.
Section 605 provides for $100 million per year in
assistance for broadband access. Just like the availability of
electricity was crucial for rural areas in the last century,
the availability of broadband is necessary for economic
development in this century. Funds may be made available for
communities of less than 20,000 people. But, the expectation is
that resources are most needed for communities that are far
smaller, perhaps those smaller than 2,500 people. These funds
can be in the form of grants. But, the Secretary may convert a
portion of these resources into loans, which is expected to be
logical in many cases. It is expected that many projects will
receive both grants and loans, which is the pattern for a
number of Rural Utilities Service (RUS) programs. It is the
expectation of the committee that the RUS will give the highest
priority for grant and loan applications for areas that do not
have any broadband service. Clearly, unlike RUS water, sewer
and electric programs, not every eligible user is expected to
actually acquire broadband service. But, the availability of
this service is crucial for both economic development and to
provide a service that a growing number of Americans are
starting to view as essential. The Secretary is required to
periodically review and when necessary change the definition of
broadband service. The Committee expects the Administrator will
apply a flexible definition of broadband services to encourage
new broader bandwidth technologies that provide significant
progress towards higher bandwidth services in rural areas and
that the program will foster the development of a variety of
technological applications including terrestrial and satellite
wireless services. This is a critical function since this is a
rapidly changing technology. The Committee has taken no
position on particular technologies and believes that the it is
very important for the Department not to chose among adequate
technologies. The Committee expects the Secretary to
participate in any FCC proceedings or Department of Commerce
study of the future of broadband services and the markets for
such services.
Section 606 provides funding for Value Added Product
Development Grants. These were first funded in the Agricultural
Risk Protection Act of 2000 and have proven to be an excellent
mechanism to assist agricultural producer based groups acquire
crucial resources so they can successfully develop value added
enterprises that help producer income and rural development
generally.
The Committee defines the term ``value-added agricultural
product'' to mean any agricultural commodity or product that
has: (1) undergone a change in physical state; (2) been
produced in a manner that enhances the value of the
agricultural commodity or the product, as demonstrated through
a business plan that shows enhanced value; (3) as a result of
the change in physical stateor the manner in which the
agricultural commodity or product was produced, the customer base for
the product has been expanded; and, (4) a greater portion of the
revenue derived from the processing of the agricultural commodity or
product is available to the producer of the commodity or product. The
Committee intends for USDA to fund value-added marketing and labeling
projects in instances where the product is produced in a manner that
enhances its value to the consumer or end user, provided there is an
adequate business plan.
The Committee notes that the Value-Added Grant Program has
demonstrated success towards ensuring that agricultural
producers retain a higher dollar value for agricultural
products. While ``value-added'' agriculture is often identified
with a processed commodity, producers are finding new
opportunities and higher values for products that do not
initially change the physical state of the crop. For example,
identity preserved grains are ineligible under the original
program. However, growers are producing commodities with
inherent characteristics that have increased value to end-users
and which can increase the portion of the value received by the
producer. Once the value is identified, producers expend
resources to meet the need. At this point the crop has
increased value in the marketplace. The program should seek to
fund sound business plans that will match producers with
processors/end users for products or commodities in this type
of value-added circumstance.
Five purposes for this section are included: (1) to
increase the share of the food and agricultural system profit
received by agricultural producers; (2) to increase the number
and quality of rural self-employment opportunities in
agriculture and agriculturally-related businesses; (3) to help
maintain a diversity of size in farms and ranches by
stabilizing the number of small and mid-sized farms; (4) to
increase the diversity of food and other agricultural products
available to consumers, including nontraditional crops and
products and products grown or raised in a manner that enhances
the value of the products to the public; (5) to conserve and
enhance the quality of land, water, and energy resources,
wildlife habitat, and other landscape values and amenities in
rural areas. It is the intent of the Committee that USDA
operate the program in a manner consistent with these purposes.
The ability of a proposal to meet the purposes of the program
should be very significant factors in the awarding of grants
including the number and degree of the purposes met.
Grants recipients are independent eligible producers (as
determined by the Secretary) and non-profit organizations.
Producers shall use the grant to: (1) develop a business plan
or perform a feasibility study for viable marketing
opportunities for the value develop strategies that are
intended to create marketing opportunities for the producer or
to create a marketing opportunity for the producer. Non-profit
organizations shall use the grant to: (1) assist the entity to
develop a business plan for viable marketing opportunities in
emerging markets for a value-added agricultural product; and
(2) to develop strategies that are intended to create marketing
opportunities in emerging markets for the value-added
agricultural product. It is the intent of the Committee that
nonprofit organizations shall also receive grants to assist in
the formation of value-added ventures and alliances that will
broaden the market for producers.
A five percent setaside of the grant funds is made for
certified organic products that expand the customer base of the
product and increases the portion of product revenue available
to producers. If there are insufficient appropriate grants
received under this subsection, the Secretary may release the
funds for other value added grants after March 31 of the fiscal
year except that the Secretary should act to provide reasonable
opportunity for applicants under this section to benefit in
fiscal year 2002.
Section 621 enlarges the annual authorization of the
crucial rural water and wastewater program within the Rural
Utilities Service. It also provides authorization for the
establishment of revolving loan funds for the financing of
small water and wastewater projects through non-profit
organizations. The selected organizations may make grants and
loans of up to $100,000 for predevelopment costs for potential
projects, replacement equipment, small scale extension projects
and other projects that are not part of the regular operation
and maintenance activities of existing systems. It is the
Committee's intent that these funds not be used to provide
grants that are in addition to other USDA financial support for
the same project.
Section 625 Certified Organizations Sharing Expertise is a
new program through which non-profit organizations with
experience in specific areas of economic or community
development may apply to be placed on lists of such
organizations certified by USDA. The expectation is that such
organizations will be listed at the State level, except for
organizations involving specialized expertise in narrow
categories where the certification may more logically occur at
the national level. Such organizations may be able to share
their expertise significantly reducing the costs to rural
communities and organizations. Funds may be appropriated to
provide additional resources for organizations willing to help
those beyond their normal boundary of activity.
Section 626 provides that the Rural Utilities Service may
provide financial assistance for projects that receive support
through tax exempt bonds. The Committee believes that this
ability would be useful. However, for the section to be in
used, a companion change will need to be made in the tax code.
Section 627 provides for a new program to provide training
for firefighters and emergency personnel in rural areas. While
the FEMA FIRE program is providing increased assistance for
firefighters, only a small portion of those funds go to
training, which is so crucial to the safety of firefighters and
emergency personnel and to their ability to protect people and
property. In many cases, those in rural areas are volunteers in
small departments with very limited resources for training. At
least 60 percent of the funds are to be devoted to partial
scholarships for training at approved centers. The expectation
is that the Department will certify those centers whenever
logical by following the certification of approved
organizations or those that have received funding in the past
from FEMA or other federal agencies for training purposes. The
Committee believes that travel costs should be minimized with
the understanding that some areas are more remote than others,
and a higher cost of travel from a more remote area should not
be a detriment for funding. However, the use of more localized
centers of good quality rather than training at distant centers
should be promoted. Up to 40 percent of the funds provided may
be allocated for the direct support of State or regional
training centers, with no center receiving more than $2 million
in a year.
Section 633 provides a number of changes in the Business
and Industry loan and loan guarantee program. It is the
Committee's desire to maximize the use of guaranteed loans
under this program with a recognition that care must be taken
to minimize losses. As losses increase, the amount of loans
that can be guaranteed with each dollar of budget authority
will decline. The Committee has provided for a considerable
expansion of loan guarantees for cooperatives and for producers
needing assistance to buy stock in cooperatives. These
provisions will provide increased support for agricultural
producers to own processing and other facilities that will
enable them to acquire increased income through the value being
added to their production and at the same time creating an
incentive for facilities to be in rural areas where they will
provide additional jobs and other benefits to the rural economy
as a whole.
Reports have reached the Committee that USDA has received
some appraisals under the program that considerably overvalued
property to the program's detriment. The bill provides that the
Department shall acquire appraisals from those who are properly
qualified to make appraisals regarding the property in
question. The Committee also has placed a cap on the initial
fee applied to a loan guarantee principal at the current rate
of 2 percent. Reluctantly, no prohibition is set on annual fees
that may be assessed because of the understanding that the
program level per dollar of budget authority of the program
would be seriously eroded in the future with such a
prohibition.
Section 636 provides for the simplification of a number of
applications and loan guarantee applications. The Department
needs to acquire information so that sound decisions can be
made regarding requested financial assistance. But it is
essential that the Department work to minimize the paperwork
burdens on applicants for Rural Development assistance within
that constraint. The Department is urged to make an analysis of
its application and other forms to see what can be done to
further reduce the paperwork burden.
Section 638 establishes a microenterprise program designed
to provide the skills that are necessary for individuals to
start, and in a healthy percentage of cases, succeed at
starting small businesses important to the individuals involved
and the rural economy as a whole. It is expected that low- and
moderate-income individuals will be the main recipients to the
skills, training and access to capital and credit as well as
continuing assistance as individuals begin operating their
small businesses. The expectation is that the Department will
focus the resources at those organizations and those models
that have had a high level of success in related government
programs.
Section 639 establishes an interagency coordinating
committee to examine the special problems of rural seniors
chaired by the Undersecretary for Rural Development. While USDA
has been the lead agency in government regarding rural economic
development, programs of importance to rural elderly
individuals is highly fractured among the departments and
agencies of the federal government. It is believed that has
resulted in both considerable inefficiencies and in needs not
being met. Substantive. Recommendations from the interagency
task force is expected.
$25 million is authorized for grants to nonprofit
organizations including cooperatives for projects of special
merit that will particularly benefit senior citizens in rural
areas. The grants under this section may equal up to 20 percent
of a project's cost in addition to assistance that may be
available through other federal programs. The intention that a
high priority will be given to projects that will result in
examples that may be widely duplicated.
The section also provides for a reserve within the
community facility program of not less than 12.5 percent of the
resources in that program for appropriate projects that meet
the standards of the program that are for senior citizens or
mainly benefit them. The Department must maintain this reserve
through April 1 of each fiscal year.
Section 640 establishes a reserve within the community
facility program of not less than 10 percent of the programs
resources for developing and constructing day care facilities.
The lack of adequate day care is very significant in most rural
areas. This prevents many parents from working or leaves their
children with inadequate care during those periods. Experiences
in recent years have shown that relatively small sums from the
community facilities program can be significantly leveraged to
have a far greater effect per government dollar provided. And,
the Department is directed to maximize efforts to acquire
significant leverage to maximize the use of funds.
Section 641 provides for an authorization to establish
rural telework centers where those in rural areas will be able
to continue to live in small communities while working for
companies whose offices are distant. Many rural institutions,
from community colleges to some area chambers of commerce,
could organize such centers. While many talk about teleworking
from home, there is considerable material that suggests that a
formal office setting with the resources that can be made
available at such locations may prove an important alternative.
A rural telework institute is also authorized. The institute
will provide as a center for assisting telework centers and
those who are developing such centers in best practices,
estimations of costs as well as working to develop new methods
to best use the structure of telework centers. The center may
be a consortia of organizations, probably with strong
educational ties.
Section 646 authorizes SEARCH grants through which State
developed councils shall provide grants to small rural
communities with populations of less than 2500 which face
significant difficulties meeting environmental requirements.
Clearly, a large number of communities do have such
difficulties. It is expected that States will give a priority
to projects that USDA connected projects and to those where the
solutions found may be of use to a number of communities in the
State and the nation.
Section 647 Authorizes the Great Plaines Regional Authority
in the State of North Dakota, South Dakota, Nebraska, Minnesota
and Iowa. The Authority shall develop a series of comprehensive
an coordinated plans for the economic development of the
region.
The authority is also authorized to receive appropriations
for the purpose of making grants particularly to those counties
which are distressed with a special emphasis on transportation,
telecommunications, and basic infrastructure such as sewer and
water facilities. The Committee recognizes the ongoing rural
development efforts that have evolved from the recommendations
of the Northern Great Plains Rural Development Commission. The
Commission was establishedin 1994 through the passage of P.L.
103-318 to prepare a 10 year rural development strategy for the
Northern Great Plains Region. The Committee supports the efforts of the
Northern Great Plains, Inc to implement the Commission's
recommendations and urges the Department with this organization to
continue to advance the findings of the Commission. However, further
efforts must be made to assure that staff resources of that
organization are allocated in a balanced manner to the benefit of all
parts of the region.
Section 652 Telemedicine and Distance Learning. This
section extends the authorization of the very effective
Telemedicine and Distance Learning Services in Rural Areas
program through fiscal year 2006. The Committee directs that
public television entities are eligible to receive assistance
under this section for high speed telecommunication services in
rural areas to provide educational programming for schools and
communities in rural areas.
Section 662 authorizes a revised program to fund the Rural
Economic Loan and Grant program that was first enacted in 1987
and which has provided approximately $185 million in economic
development assistance to rural communities. The funding will
occur through the payment of an annual 30 basis point fee by
private lenders that issue bonds or notes guaranteed by the
Administrator of RUS. These fees are placed in a sub-account
for the purpose of providing the budget authority for eligible
economic development projects through intermediaries. The
provision provides for safety and soundness and permits the
Administrator of RUS to deny the request of a lender for a
guarantee if the lender does not have the expertise to or
experience in rural utility lending or issues bonds that
without the guarantee would not be financially sound and of
investment grade quality. As used in this section, the term
``project'' means any electrification or telephone purpose
eligible for assistance under the Rural Electrification Act,
including any purpose specified in section 4 and section 201.
This provision requires that a private lender make payment on
the bonds or notes even if a loan made using the proceeds of
such bond or note is not repaid to the lender. This effectively
places the lender between the RUS and the borrower minimizing
the risk to the government.
Bonds and notes may not be used for electric generation or
to finance electric generation projects. The proceeds of the
bonds are to be used to provide private capital for rural
electric and telephone purposes that would otherwise qualify
for direct loans under the Rural Electrification Act and to
refinance bonds or notes used for such purposes. The amount of
bonds or notes that may be guaranteed for a lender may not
exceed the amount of outstanding loans of the lender that were
made concurrently with loans approved under the Rural
Electrification Act. Up to one-third of the fees collected may
be used for the cost of providing the guarantee although it is
expected to be far less than that portion of the fees charged.
TITLE VII--RESEARCH
Overview
Food and agriculture research is the backbone upon which
the vitality of our rural communities depends, the security of
our food supply rests, and the health of our environment is
protected. The challenges in food and agriculture related
research are great. The world today is a challenging place to
attain these objectives. The world's population continues to
grow rapidly, placing a strain on a whole range of resources,
from food and water, to energy, to green spaces and our natural
environment. Farmers and ranchers are being asked to produce
more, yet they are also seeking to protect and restore land,
water, air and wildlife resources. American agriculture faces
an increasingly competitive international marketplace.
Biotechnology is presenting challenges that we are just
beginning to understand and address. If these challenges are
ignored today, they will cost much more to address in the
future.
The U.S. agricultural research program has evolved over the
past 150 years into a $2.1 billion collection of programs.
While most organizations agree that investment in food and
agricultural research should be a high priority for public
funding, this agreement has rarely been translated into
meaningful increases in funding. Federal spending on
agricultural research, extension and education has been flat
the past several decades. Federally funded research is
allocated among intramural (or Agricultural Research Service)
funds, formula funds to universities, competitive grants, and
special grants.
Background
The Secretary of Agriculture coordinates USDA research,
education, and extension. Federal funds are distributed to four
agencies under the direction of the Under Secretary for
Research, Extension and Economics: the Cooperative State
Research, Education, and Extension Service (CSREES), the
Agricultural Research Service (ARS), the Economic Research
Service (ERS), and the National Agricultural Statistics Service
(NASS). Of the approximately $2.1 billion in federal money
spent in fiscal 2001 on agricultural research, education, and
extension programs, about 46 percent is spent on State-level
formula programs and competitive grant programs through CSREES,
43 percent is spent on in-house research programs conducted by
the ARS, three percent is directed to economic research
conducted in-house by ERS, five percent is spent on statistical
services conducted by the NASS, and three percent is used for
buildings and facilities.
Congress identified agricultural research as an important
issue in the 1850's. Starting in the 1860's, Congress passed a
series of bills designed to promote agricultural development:
the Morrill Act of 1862, the Second Morrill Act of 1890, the
Hatch Act of 1887, and the Smith-Lever Act of 1914. Together,
these acts established our land-grant system.
The land-grant philosophy has been the foundation of
America's agricultural productivity for over 130 years. The
three cornerstones of the land-grant approach--teaching,
research, and extension--have improved the economic well being
and quality of life for millions of Americans.
Congress passed the First Morrill Act in 1862, which
authorized the establishment of a land-grant institution in
each State to educate citizens in agriculture, home economics,
mechanical arts, and other practical professions. Under this
Act, each State was given public lands, provided that the lands
be sold or used for profit, and the proceeds used to establish
at least one agricultural college (land grants for the
establishment of colleges of agriculture, home economics, and
mechanical arts were also later given to U.S. territories and
the District ofColumbia). Public universities existed already
in some States; however, most States responded to the First Morrill Act
by legislating new colleges rather than endowing existing State
institutions. The act gave rise to a network of often poorly financed
colleges known as ``1862's.''
The Second Morrill Act passed in 1890, however, provided
for an annual appropriation to each State to support its land
grant college. In addition to providing funds for education at
land grant colleges, the act of 1890 specifically forbade
racial discrimination in admissions. A State could escape the
discrimination clause only if separate institutions were
maintained and the funds divided in a ``just'' manner. Thus,
the Second Morrill Act led to the establishment of a group of
historically African-American land grant institutions (1890s).
Today, there are 19 1890s (including Tuskegee University and
West Virginia State College) located mostly in southern States.
Over the decades, as the U.S. economy grew and changed, so
did the nature and demands for education and scientific
pursuit. As more and more U.S. citizens began to attend
college, most colleges of agriculture were transformed into
full-fledged universities. Today, although many land grant
universities are still known for their agricultural college
roots, others have little agricultural identity and students
are rarely from farm families. Currently, in addition to the 59
1862's and 19 1890's, there are 15 non-land-grant colleges that
obtain USDA funds primarily through forestry and natural
resource programs authorized under the McIntire-Stennis Act,
and 30 tribal colleges which were afforded land grant college
status under the Elementary and Secondary Education Re-
authorization Act of 1994.
The 1862 Morrill Act gave land grant colleges their mandate
to teach. In 1887, recognizing the need for research in the
agricultural sciences, Congress passed the Hatch Act to provide
money to each State for the purpose of establishing, within the
land-grant college, an agricultural experiment station.
Today, State Agricultural Experiment Stations (SAES's)
operate in conjunction with and, in almost all cases, on
locations at colleges of agriculture. Most faculty at land
grant colleges of agriculture have SAES appointments. This
grants them access to Hatch research funds administered by
USDA's CSREES and distributed to the SAES's on a formula basis.
In 1914, extension joined teaching and research as the
third major mission when Congress passed the Smith-Lever Act.
Under this act, a Cooperative Extension Service was created to
aid in disseminating to the public useful and practical
information about subjects relating to agriculture and home
economics and to encourage its application. Under the authority
of this act, the land-grant colleges and USDA were to cooperate
in extension work, which was to consist of instruction and
practical demonstration in agriculture and home economics to
persons not attending the land-grant college. Information was
to be supplied through field demonstration. Agricultural
extension was designed at the outset to be a cooperative
program. As a result, funding for these programs has been a
joint venture between the Federal Government, State and local
governments, and the land-grant universities. While there is
certainly variation among individual States, funding is roughly
one-third from each of the Federal, State and local
governments.
Under the authority of the Smith-Lever Act, there are three
Federal funding mechanisms. Section 3(b) of the Smith-Lever Act
provides that each State and the Federal Extension Service
shall be entitled to receive annually a sum of money based on a
formula that takes into consideration the rural population of
each State; Section 3(c) provides funding to seven results-
oriented base programs; and Section 3(d) are national
initiatives, intended to be established for limited time
The Secretary of Agriculture established the ARS in 1953
under the authority of the Reorganization Act of 1949. Pursuant
to the Agricultural Reorganization Act of 1994, ARS includes
functions previously performed by the Human Nutrition
Information Service and the National Agricultural Library. ARS
is USDA's in-house research agency, and as such, conducts basic
and applied research in the fields of animal sciences, plant
sciences, entomology, soil and water conservation, agricultural
engineering, utilization and development, human nutrition and
consumer use, marketing, development of integrated farming
systems, and development of methods to eradicate narcotic-
producing plants.
The National Agricultural Research, Extension, and Teaching
Policy Act of 1977 amended the research act of 1965 to
authorize a Competitive Research Grant Program. This program
was further modified in the 1990 Farm Bill in order to create a
National Research Initiative (NRI), which was first proposed by
the National Academy of Sciences. The NRI is currently
authorized at $500 million per year. While the NRI has received
enthusiastic support from the research community, funding has
averaged approximately $100 million/year.
The National Agricultural Research, Extension, and
Education Reform Act of 1998 established peer and merit review
requirements for USDA funded research and extension projects,
and requirements for integrated and multi-State research. This
Act also required institutions receiving formula funds from
USDA to prepare annually a Plan of Work insuring adequate input
from stakeholder organizations for current and future research
and extension programs. The Committee has found that
implementation of the stakeholder input provisions has been
mixed throughout the country. This Act requires the Secretary
to establish minimum standards to ensure transparency and
openness in the priority-setting process.
The Agricultural Research, Education and Extension Reform
Act of 1998 also established a research program using mandatory
funding: the Initiative for Future Agriculture and Food Systems
(IFAFS) to award competitive grants integrating research,
education and extension in emerging issues of national scope in
agriculture.
Purpose and Need
The Committee recognizes that central purposes of this Act
include ensuring the security and vitality of the nation's
agricultural and rural communities. As has been previously
noted, research plays an essential, but often unappreciated,
role in accomplishing this. The fact that resources devoted to
agricultural research have been insufficient to keep pace with
the increasing needs of farms and rural communities has been of
great concern to the Committee. In this Act, therefore, the
Committee takes a variety of actions to bolster the nation's
agricultural research capacity.
The Committee recognizes that it has been given the
authority to allocate Federal funds to address the needs of
farmers, ranchers, and their communities. While it is true,
that a majority of the economic assistance required by farmers,
ranchers, and their communities is provided in the form of
economic and income assistance, the Committee also finds that
unmet agricultural research needs are a significant roadblock
to improving farm and rural communities.
A far larger portion of the U.S. agricultural research
expenditures today comes from the private sector than in past
decades. This reflects the private sector's recognition of the
importance of research and development to ensure the
productivity, efficiency, and ultimately, profitability of food
and agriculture industries, and therefore they have stepped in
to fill the gap left by decades of essentially level federal
funding.
Initiative for Future Agriculture and Food Systems
However, this private sector funding is mostly targeted
toward a relatively limited set of goals leaving the needs of
many other areas of the agricultural and rural sector
unaddressed. The Committee finds that the only way to meet
these unfulfilled needs is through devoting a portion of the
funds allocated to the Committee for this legislation to
research programs. This bill therefore reauthorizes the
Initiative for Future Agriculture and Food Systems through 2006
and increases its level of funding to $145 million a year.
Rural policy research
The Committee finds that there are many unmet research
needs related to the special needs of rural communities. It
therefore provides $15 million annually in funding for a
competitive grants program focused on rural policy research.
This program will provide research grants for rural policy
research on topics such as: rural sociology; effects of
demographic change; needs of groups of rural citizens; rural
community development; rural infrastructure; rural business
development; rural education and extension programs; and rural
health issues.
Beginning farmers and ranchers
The Committee recognizes that the changing nature of
agriculture has created a great need for beginning farmers and
ranchers to be able to utilize a wide-range of tools such as
risk management, precision farming, crop protection, and
business planning. It therefore provides $15 million annually
in funding for a competitive grants program focused on helping
beginning farmers and ranchers with the knowledge they need to
succeed.
The Committee is concerned that the increasing
privatization of agricultural research means that valuable
public expertise is being lost in fields such as biotechnology
and agricultural genomics. The Committee is also concerned that
increasingly, more and more of the animal and plant genome may
no longer be public domain which presents serious issues for
food security--both domestically and worldwide. The Committee
expects USDA to heighten its reviews of technology transfer and
funding for agricultural biotechnology to ensure that public
funding is sufficient to maintain public availability of animal
and plant genomics, and that public funding does not lead to
concentration of animal and plant genomics in private sector
entities.
The Committee recognizes that the end of the cold war,
along with recent tragic terrorist attacks, have focused
national attention on U.S. vulnerability to biological and
chemical terrorism. Agriculture is widely considered to be a
vulnerable target for bioterrorism, also called agroterrorism.
Production of food and fiber accounts for approximately 13
percent of the gross domestic product and the employment of 24
million Americans. In 1997, the food and agriculture industry
generated over $1 trillion worth of business from its two
million farms according to Iowa State University.
A large scale biological attack on our food supply could
imperil our food supply and cause tens or hundreds of billions
of dollars in economic losses that would devastate our economy
and rural America. The Committee has therefore included in this
title several new authorizations to bolster the Federal
government's biosecurity planning and response capabilities and
response. The Committee expects the Department to utilize these
authorizations to ensure that U.S. food safety and animal
systems are prepared to address threats to our food and
agriculture systems from acts of terrorism.
The Committee strongly supports the enhanced and expanded
use of programs called for in the Conservation Title of the
bill to improve water quality in the Great Lakes system. To
support this effort, the committee believes that wider use of
advanced information, geo-spatial and decision support
technologies is needed and will improve both the cost-
effectiveness and positive impact of these conservation
programs on Great Lakes water quality. The Committee therefore
encourages the Secretary of Agriculture to initiate an
integrated study that will: (1) assess the impact and efficacy
of current and pending USDA conservation programs on the Great
Lakes; (2) determine how advanced information technologies will
promote more efficient management and use of these conservation
and resource programs as tools for improving water quality in
the Great Lakes and; (3) make specific recommendations
concerning the design and deployment of an integrated
information technology tool that will maximize the impact of
conservation programs in the Great Lakes region.
The Committee has noted the increasing significance of the
organic sector of agricultural production. While organic
production only accounts for about one percent of overall food
production, it represents a very significant contribution to
value-added and sustainable agriculture. The Committee expects
the Department to increase its efforts to promote organic
agriculture and ensure that it receives resources proportional
to its contribution to agriculture nationally. Specific actions
the Committee expects USDA to undertake are to increase the
resources available for organic on-farm research and
development through the Initiative for Future Agriculture and
Food Systems, the Federal agricultural laboratories, and
Federal organic research programs.
The Committee is concerned about efforts to provide the
Secretary with additional authority to determine, at the
request of State, local or tribal authorities, whether certain
methyl bromide treatments should be authorized. The Committee
believes that existing authority provides adequate means to
prevent the introduction, establishment or spread of plant
pests, plant diseases, or noxious weeds, and therefore has
included no corresponding provision in the Senate bill.
TITLE VIII--FORESTRY
Forestry in the farm bill
Forestry concerns, particularly those relating to non-
Federal forests, have been included in past farm bills for some
time. In 1990, a number of new forestry initiatives were
included, such as the Office of International Forestry and
Forest Legacy Program. Similarly, the 1996 bill covered
forestry issues. This year's bill continues to strengthen
national forestry efforts.
Forests and private forest landowners
Sustainable management of America's non-industrial private
forest lands is important to Americans future. The majority of
wood produced in the United States comes from private forest
lands. These lands provide many benefits to society, including
air and water quality, fish and wildlife habitat, protection of
soils and wetlands, and opportunities for recreation and
solitude. The products and services resulting from stewardship
of these forests contribute greatly to the economic and
environmental health of the country. Yet despite the importance
of these lands, their full public benefit and private value are
not being captured. Only ten percent of these lands are managed
in accordance with professional forestry advice. The long term
investments needed for sustainable management of these lands
pose a financial challenge to landowners. In addition, non-
industrial forest lands are faced with many threats, including
the threats of forest fragmentation, catastrophic wildfires,
and invasive species. Society depends more than ever on
private, non-industrial forest landowners to provide the market
commodities and environmental benefits required to maintain a
high quality of life for the American people.
Forestry programs
There are nearly ten million non-industrial private forest
landowners in the United States. These individuals own nearly
half of the nation's 747 million acres of forest land. Yet as
mentioned above, only a small portion of these landowners
receive professional forestry assistance. The forestry title
addresses this issue by establishing a new Sustainable Forest
Management Program for the nation's private forest landowners
and participating States. This program will provide assured
funding for States to address a variety of multiple resource
objectives, including forest health and productivity, soil, air
and water quality, agroforestry, preservation of aesthetic
quality and opportunities for outdoor recreation.
The Committee recommends the Sustainable Forest Management
program be administered jointly by the Forest Service and the
Natural Resources Conservation Service. If the Secretary
chooses either the Forest Service or Natural Resources
Conservation Service individually to administer the program,
the Committee expects that the program will be run in close
coordination with the other agency.
Few private forest landowners, on their own, have the
financial and technical resources to manage their forests. The
Committee believes that cooperatives provide landowners with
the tools and market leverage necessary for cost-effective
forest land management, as well as the economic incentives to
do so. Because cooperatives are owned by their members,
landowners enjoy the benefits of collaboration, while retaining
individual ownership and control of their lands. Sustainable
forestry cooperatives have demonstrated success in helping
private forest landowners improve the income earning potential
and environmental health of their woodlands. Therefore the
title includes a sustainable forestry cooperative program to
support their development.
Due to the interdisciplinary nature of forestry
cooperatives, the Committee recommends the program be
administered jointly by the Forest Service, through the
Cooperative Forestry Landowner Assistance Programs, to provide
expertise and guidance on sustainable management of woodlots,
and by the Rural Cooperative-Business Service to provide
expertise and guidance on cooperative organization and
development.
The Committee recognizes that the severity and intensity of
wildland fires have increased dramatically over the past few
decades. Decades of aggressive fire suppression, combined with
rural residential development, have drastically changed the
look and fire behaviors of forests and rangelands. While
wildland fires burning under the right conditions can be
beneficial and sometimes essential to the health of forests and
rangelands, catastrophic wildfires are devastating, costly to
control, and can trigger a wide array of detrimental impacts.
In the urban-wildland interface, these fires not only cause
damage to the forests and environment, but also pose serious
risks to human lives, personal property, and other resources.
There are numerous at- risk communities across the country
intermingled in the urban-wildland interface.
To address these threats, the title includes authorization
for at least two forest fire research centers in western
States. The centers are to conduct research into ecologically
sound fire control methods and then to transfer the findings to
fire and land managers. Additionally, the title establishes a
wildfire prevention and hazardous fuel purchase program. This
provision provides grants to entities to use forest biomass
(near communities with significant risk of fires) to generate
electricity. It also authorizes contracts to remove hazardous
fuel from forests, focusing on the urban-wildland interface.
The Committee also recognizes that protecting people and
structures in the urban-wildland interface demands close
coordination between local, State, tribal, and Federal
firefighting resources. Thus, the title creates a community and
private land fire assistance program.
The Forestry title also adds authorization for a
sustainable forestry outreach initiative to provide educational
assistance to forest landowners; increases the authorization
for the Renewable Resources Extension Act; authorizes a
watershed forestry initiative to provide cost-share and
technical assistance to protect watersheds and water quality in
forested areas; and reauthorizes the Forestry Incentives
Program and Office of International Forestry.
TITLE IX--ENERGY
Energy and the Farm Bill
This farm bill includes a comprehensive energy title for
the first time. The title's presence reflects the increasing
importance that energy plays in the nation's business, as well
as the economic, social, public health and environmental
opportunities that exist for agricultural producers throughout
the United States.
It is worth noting, however, that energy matters have been
addressed periodically in past agricultural legislation. Most
recently, the 1996 Farm Bill included provisions related to
energy and global climate change. The Food, Agriculture,
Conservation and Trade Act of 1990 contained language
pertaining to biomass energy. The Food Security Act of 1985
included a biofuels initiative. Finally, the Food and
Agriculture Act of 1977 included several energy related
provisions, including those pertaining to renewable energy
generation.
Renewable energy and energy efficiency
Renewable energy development and increased energy
efficiency hold great promise for the agricultural sector and
the nation's farmers and ranchers. Agricultural energy sources
can increase farmer income, create new jobs, revitalize rural
communities, add to the nation's energy security, and reduce
pollution. In addition, cost-effective energy efficiency
improvements in farm operations can save farmers money which
they can then invest in other useful ways. This title
establishes new initiatives to promote agriculturally based
renewable energy and energy efficiency opportunities.
Currently, most farmers do not own or market renewable-
based electricity. Some farmers are leasing land for the
placement of wind turbines or other renewable energy generation
to large energy companies. However, many would like to produce
and market electricity derived from renewable sources. This
title establishes a renewable energy development grant and loan
program to support utility-scale farmer or rancher owned
cooperatives or other business ventures to produce electricity
from renewable sources.
Rural communities rely on rural electric cooperatives or
other electric utilities for their electricity supply. Many of
these utilities are well situated geographically to produce
clean energy from renewable sources for their customers or
members. The title assists such utilities in developing
renewable energy to serve the needs of rural communities and
provide attendant public health or environmental benefits.
Agriculture is an energy intensive industry. Equipment and
various farm processes require significant use of electricity,
fuel, and other energy sources. Given that many in the
agricultural community are having difficulty earning sufficient
income, it is critical that new avenues are pursued to reduce
costs and increase farmer energy self-sufficiency. The energy
title meets these needs by creating an energy audit and
renewable energy assessment competitive grant program. This
program would allow eligible entities around the country to
provide farmers, ranchers, and rural small businesses with
comprehensive energy audits, including assessments of renewable
energy generation potential. The audits could spur substantial
savings, and increase on-farm clean energy generation and
independence. The Committee notes that audit reimbursements may
be made either directly to farmers, ranchers or rural small
businesses, or through entities administering the program for
the Department.
Often the biggest obstacle to investing in on-farm
renewable energy or making energy efficiency improvements is
the lack of capital or ready financing. A grant and loan
program is established to assist eligible farmers, rancher and
rural small businesses to purchase renewable energy systems
like wind turbines, photovoltaic systems, and methane
digesters, as well as to make energy efficiency improvements
including motor pump, crop drying or lighting retrofits.
Additional opportunities exist for farmers and rural
communities to become energy self-sufficient through the use of
hydrogen and fuel cell technologies. Fuel cells powered by
hydrogen hold the potential to provide vast quantities of power
and heat in a cost effective manner with little environmental
impact. In addition to fuel cells, hydrogen as well as methane
produced on farms can be used in emerging advanced energy
technologies like microturbines and stirling engines. In rural
areas, hydrogen could ultimately be produced from renewable
resources including biomass, wind, solar, and geothermal
technologies. The title provides financial support for projects
and studies related to hydrogen and fuel cell technologies to
further promote farm-based and rural clean energy
opportunities.
Biobased product development
Biobased products create additional markets for
agricultural resources, leading to greater stability in the
farm economy. These products are manufactured near the source
of the raw materials, creating new industries and jobs in rural
locations. Many biobased products also have reduced impacts on
human health and the environment, including reduced air
emissions and impacts on marine environments compared to
competing products.
The Federal Government is the nation's single largest
consumer, purchasing in excess of $200 billion in products each
year. As such, it can help stimulate markets for agricultural
products by purchasing biobased products, including fuels,
chemicals, adhesives, lubricants, coatings, plastics, cleaning
products and building materials. These purchases would afford
substantial benefits to farmers, rural communities, national
security and the environment.
The intent of the title's biobased product purchasing
requirement is to stimulate the production of new biobased
products and to energize emerging markets for those products by
requiring the Federal Government to purchase such products
listed by the Department of Agriculture.
The Department of Agriculture, in consultation with the
Environmental Protection Agency and the National Institute of
Standards and Technology, will serve as the final arbitrator of
what is or is not considered a biobased product to be listed
and afforded Federal procurement preference.
The Committee believes there are tremendous opportunities
to reduce the use of oil by converting domestic sources of
biomass into petroleum substitutes. Just as petroleum is
refined into a broad array of products, the nation should
refine biomass, including agricultural wastes and residues into
biofuels, chemicals, and electricity.
The energy title includes a program to help foster the
development of large-scale plants that produce multiple
products from biomass. By producing fuels, chemicals and in
some cases electricity a biorefinery will maximize the
economics of biomass and minimize the environmental footprint.
The Department of Agriculture and Department of Energy
currently carry out research, development, and demonstration
initiatives in support of biorefineries. Thisprovision would
add to the resources available at the Department of Agriculture to
support technologies that produce multiple products from biomass.
In carrying out this provision of the title, the Department
should coordinate its new resources with existing efforts and
with related activities at the Department of Energy. The
Biomass Research and Development Board, created pursuant to the
Biomass Research and Development Act of 2000, should be engaged
in the coordination effort, in addition to its consultative
role under this section.
In making selections for competitive awards, the Secretary
should give particular weight to projects that produce multiple
products--fuels, chemicals, and power--and do so in a cost
effective and environmentally sound manner. The Secretary
should also emphasize different kinds of feedstocks, including
cellulosics and conversion processes. Additionally, the
Secretary should seek geographic diversity across the projects
selected. Finally, the Secretary should give consideration to
supporting the expansion of existing biorefineries so that they
may produce new and emerging technologies for converting
biomass into useful products.
In addition to biorefinery support, the Committee believes
biomass research and development also need to be aggressively
pursued. Thus, the energy title funds the Biomass Research and
Development Act of 2000 to promote research and development
leading to the production of biobased industrial products. This
legislation requires the Secretaries of Agriculture and Energy
to competitively award grants, contracts and financial
assistance to eligible entities to carry out research and
development of low cost and sustainable biobased industrial
products.
It should be noted that the term biomass, in the definition
provision of the title and elsewhere, is not intended to allow
lands set aside for conservation purposes to be used for
biomass harvest if such use would limit the water quality
protection, soil erosion prevention, or wildlife habitat
enhancement purposes for which the land was primarily set
aside.
Carbon sequestration, research, development and demonstration
Farming as an economic activity is highly vulnerable to
changes in weather patterns. Recent studies estimate that total
worldwide crop production could decline significantly over the
next century as the global average temperature continues to
increase. The U.S. agricultural sector has a vested interest in
attempting to forestall such a severe change, and carbon
sequestration in soils and plants could be an important aspect
of this strategy.
In preliminary estimates, USDA and academic scientists
found that U.S. farmers can sequester additional carbon,
between 75 and 208 million metric tons of carbon per year, by
adopting conserving agricultural and forestry practices on a
wide basis.
A crucial step in developing an understanding of
sequestration uncertainties and opportunities will be to devise
practices to measure, monitor and verify carbon and other
greenhouse gas accumulation in soils and plants that are both
accurate and cost-effective. This title provides the U.S.
Department of Agriculture with the authority to undertake
necessary research, development and demonstration projects to
attain such an objective.
The Committee recognizes that in order to assist land
managers to select conservation management systems to increase
soil and plant carbon sequestration, field scale models or
decision support systems that predict the site-specific carbon
impact of management alternatives will be needed. This
technology will also be required to incorporate carbon benefits
into an environmental benefits index.
Secretarial discretion and priority setting
The Committee believes that the development and
implementation of renewable energy and energy efficiency
initiatives should be a Department priority. In order to
implement the provisions of the title, the Committee directs
the Secretary to provide it with a strategy for accomplishing
the goals and objectives of the title no later than 90 days
after the date of enactment. This strategy should identify the
ways in which the Secretary will accomplish the objectives of
this title, including the lead organization or individual in
the Secretary's office who will coordinate this strategy, the
points of contact in each agency responsible for implementing
the programs and strategies in this title, and the manner in
which the Department will coordinate and collaborate with other
departments and agencies in the Federal Government in
implementing this renewable energy and energy efficiency
strategy.
TITLE X--MISCELLANEOUS
Crop insurance provisions
The vast majority of crop insurance policy holders appear
to be satisfied to buy their coverage in five percent
increments. Consequently, Section 1011 extends the prohibition
from last year's Agricultural Risk Protection Act against
continuous coverage, barring purchase of crop insurance
coverage except at five percentage point intervals, starting at
50 percent of the record or appraised average crop yield. This
provision, while providing budgetary savings, did not
appreciably affect the operation of the federal crop insurance
system in 2001. Its extension should not be different.
For certain crops, loss of crop quality in recent years due
to bad weather has been nearly as problematic as loss of
production. Farmers have long raised concerns about quality
loss adjustment procedures in use in the federal crop insurance
program. Section 1012 clarifies the quality loss provisions of
the Agricultural Risk Protection Act of 2000, requiring that
after appropriate review, changes in quality loss adjustment
procedures be completed prior to the 2003 reinsurance year.
Thus, it provides a date certain for revised quality loss
provisions to be included in crop insurance policies
In general, in order to remain eligible for a range of USDA
benefits, producers are required to develop conservation plans
for highly erodible lands and then to carry out those plans.
Likewise, producers are expected to conserve wetlands to
preserve eligibility. The list of federal programs covered by
these conservation rules is broad. It includes AMTA contract
payments, marketing assistance loans and any type of price
support or payment. Also included are farm storage facility
loans, disaster payments, FSA direct or guaranteed loans, EQIP
payments, CRP payments and other conservation payments.
Until the 1996 farm bill, crop insurance was also included
on that list. For the sake of consistency, conservation
requirements should apply to the entire range of USDA programs
in USDA that provide direct and indirect benefits to farmers,
which clearly includes crop insurance. For the small number of
insured farmers who do not currently have conservation plans
but do farm highly erodible lands, USDA permits them a grace
period to develop one. Section 1013 restores crop insurance to
the list of programs under which conservation compliance
requirements must be observed.
Country of origin labeling
Many American consumers want to know the country of origin
of their food. This Act therefore requires retailers to notify
consumers of the country of origin of beef, pork, lamb, fish,
fruits, vegetables, and peanuts. This provision provides
consumers with greater information about the food they buy.
Most of the products U.S. consumers purchase today are already
labeled, with the notable exception of many food products. This
provision brings the United States in line with many of its
current trade partners, who already have country of origin
labeling. These countries include Canada, Japan, and the
countries of the European Union. The Committee expects the
Secretary to look to verification programs currently used by
the USDA in enforcing the new provision.
Nonambulatory livestock
The Committee finds that the transport and marketing of
downed livestock can be inhumane, and that meat from downed
livestock may involve increased food safety risks. This Act
therefore makes it unlawful for any stockyard owner, market
agency, or dealer to buy, sell, give, receive, transfer,
market, hold, or drag any nonambulatory livestock unless the
nonambulatory livestock has first been humanely euthanized.
This provision will not apply to farms not subject to the
authority of the Grain Inspection, Packers, and Stockyards
Administration, nor will it apply in a case in which
nonambulatory livestock receive veterinary care intended to
render the livestock ambulatory. The Committee intends that
veterinary care intended to return a downed animal to an
ambulatory state must be administered by a veterinarian and
must not include coercive actions such as the use of electric
prods, pushing or dragging the animal. If veterinary care is
insufficient to make the animal ambulatory, then the animal
must be humanely euthanized immediately. The Committee expects
that this provision will be enforced pursuant to Section 312 of
the Packards and Stockyards Act, along with other pertinent
sections.
Animal Welfare Act amendments to animal fighting provisions
Sections 1024 and 1025 seek to close loopholes in the
Animal Welfare Act that have made it difficult for law
enforcement personnel to enforce laws relating to animal
fighting. Section 1024 increases the penalties for violations
of the animal fighting provisions of the Animal Welfare Act and
broadens the definition of the term ``interstate or foreign
commerce'' to include movement from any State into any foreign
country. Section 1025 removes language from the Animal Welfare
Act that has allowed birds to be moved in interstate or foreign
commerce for purposes of animal fighting as long as they are
taken to a State in which cockfighting is legal. These changes
will make it illegal for anyone to transport birds across State
lines for fighting purposes, regardless of whether the State or
foreign country to which they are being sent allows
cockfighting.
The Committee notes that there are 142 State and local law
enforcement agencies that have endorsed the effort to close the
loopholes in the animal fighting provisions of the Animal
Welfare Act. Law enforcement officials have indicated to the
Committee that the current Federal law, which allows shipment
of birds to States and countries where cockfighting is legal,
has undermined the effectiveness of their State bans against
cockfighting.
Food Safety Commission
Food-borne illness continues to be a public health concern
in the United States. Even though the U.S. food supply is as
safe as any in the world, every year millions of Americans
become sick, and many die from food borne pathogens. Changes in
the ways food is produced, distributed, and consumed present
new challenges for ensuring the safety of our food. Americans
are eating a wider variety of foods. While eating a variety of
foods is beneficial to health, it presents new food safety
challenges and may lead to different patterns of exposure to
food-borne illness. More consumers desire a wide variety of
foods year round, making food safety issues surrounding
importation, transportation and refrigeration increasingly
important.
Americans are also eating more of their meals away from
home. In fact, fifty cents of every food dollar is spent on
food prepared outside the home. This food is obtained not only
from restaurants and grocery stores, but is also consumed in
institutional settings such as schools, hospitals, and nursing
homes. This creates a situation where comparatively few people
are involved in preparing large numbers of meals for others
such that the potential impact of disease-producing errors
increases.
The United States has a fragmented Federal food safety
system as documented by the Congressionally-mandated study of
the National Academy of Sciences. At the Federal level, at
least twelve agencies are involved in the key functions of food
safety such as monitoring, surveillance, inspection,
enforcement, outbreak management, research, and education.
The Committee therefore believes that a commission should
be established to develop recommendations for how the disparate
food safety statutes and approaches can be harmonized with one
another to improve public health, improve coordination of the
Federal food safety system, minimize inefficiencies, and reduce
gaps in the system. The Committee expects this work to build
upon the recommendations of the report of the National Academy
of Sciences entitled ``Ensuring Safe Food from Production to
Consumption''.
National Organic Cost-Share Certification Program
The Committee has noted the increasing significance of the
organic sector of agricultural production. While organic
production only accounts for about one percent of overall food
production, it represents a very significant contribution to
value-added and sustainable agriculture. To assist organic
producers and help implement USDA's National Organics Program,
the Committee therefore provides in this Act that organic
farmers may receive up to $500 each from the CCC to help cover
the cost of obtaining organic certification.
IV. Section-by-Section Analysis
TITLE I--COMMODITY PROGRAMS
Section 100. Definitions
This section defines terms necessary for implementation of
this title, including considered planted, contract acreage,
contract commodity, contract payment, loan commodity, oilseed,
payment yield, and producer.
Subtitle A--Direct and Counter-Cyclical Payments
Section 111. Direct and counter-cyclical payments
This section authorizes the Secretary to enter into
contracts with eligible owners or producers on a farm. The
section establishes contract requirements including
conservation compliance, wetlands protection, planting
flexibility restrictions, and agricultural use. The section
requires the Secretary to protect the interests of tenants and
sharecroppers and to provide for fair and equitable sharing of
contract payments among the eligible producers on a farm. The
section establishes eligible cropland and contract acreage and
provides the methodology to establish the payment yield for
each contract commodity. The section allows producers on a farm
to update contract acreage and payment yields or to retain the
current base acres and yields and add recent oilseed production
experience on up to 100 percent of available cropland.
The Secretary is directed, to the extent practicable, to
begin entering into contracts not later than 45 days after the
date of enactment and to complete contracts within 180 days of
enactment. However, at the beginning of each fiscal year the
Secretary shall allow an eligible producer to enroll land from
expiring or terminated conservation reserve contracts. The
section establishes the duration of the contract as beginning
with the 2002 crop and extending through the 2006 crop, unless
earlier terminated by the producer.
The section provides for direct payments for each of the
2002 through 2006 fiscal years. The section establishes direct
payment rates for each contract commodity for each fiscal year.
The payment amount for each contract commodity on the farm is
equal to the product of the direct payment rate times the
contract acreage times the payment yield. Producers may elect
to receive an initial payment equal to 50 percent of the annual
payment on or after December 1 of the fiscal year. The
Secretary will make the final payment not later than September
30 of the fiscal year.
The section provides for counter-cyclical payments for each
of the 2002 through 2006 crop years. The counter-cyclical
payment rate is equal to the difference between the income
protection price as established for each of the contract
commodities and the sum of the higher of the average price of
the contract commodity during the first 5 months of the
marketing year and the loan rate for the contract commodity
plus the applicable direct payment for the contract commodity.
The payment amount for each contract commodity on the farm is
equal to the product of the counter-cyclical payment rate times
the contract acreage times the payment yield. Finally, the
section provides for counter-cyclical payments to be made not
later than 190 days after the beginning of the marketing year
for the crop of the covered commodity.
Section 112. Violations of contracts
This section establishes a penalty for first time
violations of planting flexibility restrictions equal to twice
the amount otherwise payable under the contract for the
applicable crop year on each acre that is inadvertently planted
to a restricted crop.
Section 113. Planting flexibility
This section prohibits the planting of the following crops
on contract acreage: fruits, vegetables (other than lentils,
mung beans, dry peas, and chickpeas); and, beginning with the
2003 crop, wild rice.
Subtitle B--Nonrecourse Marketing Assistance Loans and Loan Deficiency
Payments
Section 121. Nonrecourse marketing assistance loans and loan deficiency
payments
This section makes marketing assistance loans and loan
deficiency payments available through the 2006 crops for loan
commodities--wheat, corn, grain sorghum, barley, oats, upland
cotton, extra long staple cotton (no loan deficiency payment),
rice, oilseeds, wool, mohair, honey, dry peas, lentils, and
chickpeas. The section provides for adjustments to the
prevailing world market price for upland cotton and special
marketing loan provisions for upland cotton and extra long
staple cotton through July 31, 2007.
Section 122. Eligible production
This section makes any quantity of a loan commodity
produced on the farm eligible for a marketing loan provided the
producer complies with applicable conservation and wetland
protection requirements.
Section 123. Loan rates
This section establishes loan rates for each loan
commodity. The section allows the Secretary to make appropriate
adjustments in the loan rates for any loan commodity for
differences in grade, type, quality, location and other
factors.
Section 124. Term of loans
This section establishes a loan term of 9 months beginning
on the first day of the first month after the month in which
the loan is made.
Section 125. Repayment of loans
This section requires the Secretary to permit producers to
repay loans at the lesser of the loan rate plus interest or a
rate that the Secretary determines will minimize potential loan
forfeitures; minimize the accumulation of stocks; minimize the
cost incurred by the Federal Government in storing the
commodity; allow the commodity to be marketed freely and
competitively; and minimize discrepancies in marketing loan
benefits across State boundaries and across countyboundaries.
The above repayment criteria apply to all loan commodities except
upland cotton, extra long staple cotton, and rice.
Section 126. Loan deficiency payments
This section provides for loan deficiency payments for
producers on a farm that produce a loan commodity (except extra
long staple cotton), agree to forgo obtaining a loan, and have
a beneficial interest in the loan commodity. The section
requires the Secretary to determine the amount of the payment
on the earlier of the date on which the producers on the farm
marketed or otherwise lost beneficial interest in the loan
commodity or the date the producers on the farm request the
payment.
Subtitle C--Other Commodities
CHAPTER 1--DAIRY
Section 131. Milk price support program
This section extends the milk price support program at the
support price of $9.90 per hundredweight and requires the
Secretary to allocate the rate of price support between the
purchase prices for nonfat dry milk and butter in a manner that
will result in the lowest level of expenditures by the
Commodity Credit Corporation.
Section 132. National Dairy Program
This section establishes a national program that will
stabilize the production, price and marketing of milk and other
dairy products in the United States and directs the Secretary
to carry out the program during each of calendar years 2002
through 2006. The provisions of the amended section 142 are as
follows:
Subsection (a) sets forth the purpose of the program.
Subsection (b) defines the terms used throughout the
section, including eligible production, which is capped at
500,000 pounds of milk per producer per month; Federal milk
marketing order; marketing area; and producer.
Subsection (c) requires the Secretary to amend Federal milk
marketing orders to establish a minimum price per hundredweight
for Class I milk that is not less than the sum of the adjusted
Class I milk differential and at least $14.25.
Subsection (d) requires the Secretary to provide for
uniform national pooling among producers of milk under all
Federal milk marketing orders of all funds equal to the
difference between the price of Class I milk and the price of
Class I milk if this section were not in effect. The Secretary
is required to distribute the amounts in the national pool to
all producers covered by Federal milk marketing orders, based
on eligible production.
Subsection (e) provides for payment of administrative
costs; any increased costs of nutrition programs, both Federal
and State; and to reimburse the Commodity Credit Corporation
for any additional costs to carry out the milk price support
program.
Subsection (f) provides that during each month when the
average Class III price falls below $14.25 per hundredweight,
the Secretary shall use the funds of the Commodity Credit
Corporation (CCC) to make a payment to each producer for
eligible production of Class II, III and IV milk. The
subsection establishes the payment rate equal to 25 percent of
the difference between $14.25 per hundredweight and the average
price for Class III milk during the month. Payments under this
subsection cannot exceed $300,000,000 per fiscal year.
Section 133. Dairy Export Incentive and Dairy Indemnity Programs
This section extends the dairy export incentive and dairy
indemnity programs until 2006.
Section 134. Fluid milk promotion
This section amends the Fluid Milk Promotion Act of 1990 by
defining fluid milk processor as any person who processes and
markets commercially more than 3,000,000 pounds of fluid milk
products in consumer-type packages per month.
Section 135. Dairy product mandatory reporting
This section amends the Agricultural Marketing Act of 1946
to define ``dairy products'' as manufactured dairy products and
substantially identical products designated by the Secretary
that are used by the Secretary to establish minimum prices for
Class III and Class IV milk under a Federal milk marketing
order.
Section 136. Funding of dairy promotion and research program
This section amends the Dairy Production Stabilization Act
of 1983 by defining the term ``imported dairy product''; adding
not more than 2 members who represent importers of dairy
products to the National Dairy Promotion and Research Board;
imposing an assessment on imported dairy products; and allowing
importers to vote in the referendum.
CHAPTER 2--SUGAR
Section 141. Sugar program
This section reauthorizes the sugar program through 2006
with amendments.
Subsection (a) allows the Secretary to adjust loan rates,
if support for foreign competitors is reduced more than is
required under the Uruguay Round Agreement on Agriculture.
Subsection (b) requires the Secretary to pay loan benefits
to a producer of sugar beets or sugarcane if the processor has
filed for bankruptcy or is otherwise insolvent. The subsection
prohibits the Secretary from imposing any administrative
requirement that has the effect of preventing a processor from
electing to forfeit the loan collateral.
Subsection (c) terminates the marketing assessment on sugar
effective October 1, 2001.
Subsection (d) eliminates the penalty for forfeiture of
sugar under loan.
Subsection (e) authorizes nonrecourse loans on in-process
sugars and syrups.
Subsection (f) requires the Secretary to operate the sugar
program, to the extent practicable, at no cost to the Federal
Government and authorizes the Commodity Credit Corporation to
accept bids from processors (acting in conjunction with
producers) for the purchase of sugar inventory in exchange for
reduced production.
Subsection (g) requires producers of sugarcane in a State
with more than 250 producers of sugarcane to report yields and
acres and allows the Secretary to require similar reports from
each producer of sugarcane and sugar beets. The subsection
requires importers of sugars, syrups, or molasses to be used
for human consumption, other than quantities that are within
the tariff-rate quota, to report.
Subsection (h) makes the sugar program available through
the 2006 crop.
Subsection (i) reduces the CCC interest rate on sugar loans
by 100 basis points.
Section 142. Storage facility loans
This section establishes a sugar storage facility loan
program to provide financing for processors of domestically-
produced sugarcane and sugar beets to construct or upgrade
storage and handling facilities for raw sugars and refined
sugars.
Section 143. Flexible marketing allotments for sugar
This section amends the Agricultural Adjustment Act of 1938
to require the Secretary to establish marketing allotments for
the 2002 through 2006 crops of domestically grown sugar to
eliminate loan forfeitures.
Subsection (a) repeals repetitive reporting provisions.
Subsection (b) provides for estimates of the quantity of
sugar that will be consumed in the United States and the total
U.S. sugar supply.
Subsection (c) updates the allotment formula for current
U.S. import obligations, assigns allotments between sugarcane
and sugar beets, and provides for the suspension of allotments
whenever imports are estimated to exceed a certain level.
Subsection (d) updates the base period and other factors
applicable to the allocation of sugarcane and sugar beet
allotments among sugarcane and sugar beet processors,
respectively.
Subsection (e) establishes procedures for the Secretary to
reassign allotments if a processor cannot meet the allocation.
Subsection (f) prescribes the manner in which allotment
disputes are settled and provides for certain adjustments in
the event a processor closes.
Subsection (g) defines mainland state and offshore state
and allows the Secretary to preserve certain acreage base
history for a period of not more than 5 consecutive years.
CHAPTER 3--PEANUTS
Section 151. Peanut program
This section, in subsection (a), amends Subtitle D of the
Federal Agriculture Improvement and Reform Act of 1996 by
adding at the end a new chapter which establishes a revised
peanut program. Under the chapter, the peanut program will more
closely resemble the program established by the bill for other
program commodities. Specifically, the new peanut program
provides producers with marketing loan assistance, including
loan deficiency payments, and both direct and counter-cyclical
payments. The new program will terminate the marketing quota
system and compensate quota holders for the value of the lost
quota. The peanut provisions of the new chapter 3 are as
follows:
Section 158A defines terms as used in the chapter
Definitions are provided for counter-cyclical payment,
direct payment, effective price, historical peanut producers on
a farm, income protection price, payment acres, peanut acres,
payment yield, and peanut producer. Importantly, the term
payment acres defined in paragraph (6) means 85 percent of the
peanut acres on a farm. Under the bill, direct payments and
counter-cyclical payments are made on payment acres as so
defined.
Section 158B, in subsection (a), establishes procedures and
requirements for the Secretary to determine for each historical
producer the appropriate payment yields and payment acres. The
average yield is to be determined on all farms of the
historical producer for the 1998 through 2001 crop years,
excluding any year when peanuts were not produced. Average
acreage for the historical producer is to be based on the four
year average of acreage planted during 1998 through 2001.
Subsection (b) requires the Secretary to allow each
historical producer to assign the average peanut yield and
average acreage determined under subsection (a) to cropland on
a farm. The average of all the yields, and the total number of
acres, assigned to the farm will be considered to be the
payment yield and peanut acres, respectively, for the farm for
the purpose of making direct and counter-cyclical payments.
Subsection (c) requires a historical peanut producer to
notify the Secretary of the assignments of yield and acres not
later than 180 days after the date of enactment of the bill.
Subsection (d) limits payment acres for peanuts on a farm
to 85 percent of the peanut acres assigned to the farm.
Subsection (e) requires the Secretary to reduce the peanut
acres for a farm, or the base acres for some other covered
commodity, such that the total of the peanut acres, contract
acreage, and acreage on the farm enrolled in a conservation
program for which payments are made in exchange for not
producing a crop, does not exceed the actual cropland acreage
of the farm. In making this determination, the Secretary must
take into account additional acreage as a result of an
established double cropping practice.
Section 158C requires the Secretary to make, for each of
the 2002 through 2006 fiscal years, direct payments to peanut
producers on a farm with peanut acres and payment yields, as
established under section 158B. The payment rate for direct
payments is $0.018 per pound. The payment amount is figured by
multiplying the payment rate times the payment acres times the
payment yield. The section provides the Secretary guidance with
respect to when direct payments must be made, and the option of
producers to receive advance payments.
Section 158D, in subsections (a) through (c), requires the
Secretary, for each of the 2002 through 2006 crops of peanuts,
to make counter-cyclical payments if the effective price is
less than the income protection price. The effective price is
defined, based on a 12 month marketing year, as the sum of the
greater of the national average market price, or the national
average loan rate, and the payment rate for peanuts established
for the purpose of making direct payments. The income
protection price is set at $520 per ton.
Subsection (d) provides that the payment amount of the
counter-cyclical payment is to be determined by multiplying the
payment rate times the payment acres on the farm times the
payment yield for the farm. The payment rate is defined as the
difference between the income protection price and the
effective price.
Section 158E, in subsection (a), provides that peanut
producers must comply with certain conservation (highly
erodible land, and wetland provisions of the Food Security
Act), planting flexibility, and agriculture or conserving use
requirements in order to receive either direct or counter-
cyclical payments. The Secretary may issue regulations to
ensure compliance with this subsection.
Subsection (b) provides that, in the event of foreclosure,
peanut producers will not be required to repay a direct or
counter-cyclical payment if the Secretary finds that forgiving
the repayment is appropriate and fair.
Subsection (c) involves the transfer or change of interest
in a farm. Generally, the transfer or change in the interest of
a peanut producer in a farm for which direct or counter-
cyclical payments are made will result in the termination of
payments, unless the transferee or owner agrees to assume the
obligations described under subsection (a). The Secretary may
not impose any restrictions on the transfer of peanut acres or
payment yield of a farm as part of a transfer or change in
ownership.
Subsection (d) provides that as a condition of receiving
payments, the Secretary must require acreage reports for the
farm.
Subsection (e) requires the Secretary to provide adequate
safeguards to protect the interests of tenants and
sharecroppers.
Subsection (f) requires the Secretary to provide for the
sharing of payments among peanut producers on a farm on a fair
and equitable basis.
Section 158F restricts planting flexibility as it relates
to peanut acres on a farm. Generally, any commodity or crop may
be planted on peanut acres, except fruits, vegetables (other
than lentils, mung beans, and dry peas), and wild rice (but
only after the 2002 crop). Special provisions are made in
situations where there is a history of double-cropping of
peanuts with other crops, on farms with a history of planting
crops that would otherwise be prohibited by this section.
Section 158G provides for marketing assistance loans and
loan deficiency payments. Subsection (a) requires the Secretary
to make available, for each of the 2002 through 2006 crops,
non-recourse marketing assistance loans. Loans are to be made
under such terms and conditions as determined by the Secretary.
As appropriate, the Secretary may provide for loan benefits to
be made available to producers through a designated marketing
association of peanut producers, the Farm Service Agency, or a
loan servicing agent approved by the Secretary.
Subsection (b) establishes the loan rate at $400 per ton.
Subsection (c) provides that marketing assistance loans
will be for a term of 9 months, and that loans may not be
extended.
Subsection (d) requires the Secretary to permit repayments
of marketing assistance loans at a rate (loan repayment rate)
that is the lesser of the loan rate (plus interest) or a rate
that will minimize forfeitures, accumulation of stocks, storage
costs, and allow peanuts to be marketed freely and
competitively both domestically and internationally.
Subsection (e) authorizes the Secretary to make loan
deficiency payments available to producers in lieu of marketing
assistance loans. Generally, the amount of the loan deficiency
payment is determined by multiplying the loan payment rate
(amount by which the loan rate exceeds the loan repayment rate)
by the quantity of peanuts produced on the farm.
Subsections (f) and (g) require compliance with highly
erodible land and wetland conservation provisions of the Food
Security Act, and allows the Secretary to implement
reimbursable agreements or to otherwise provide for the payment
of expenses of the program in a manner that is consistent with
other commodities.
Section 158H is effective beginning with the 2002 crop.
Subsection (a) requires that all peanuts placed under a
marketing assistance loan must be officially inspected and
graded by a Federal or State inspector. Peanuts not placed
under loan may be graded at the option of the producer.
Subsection (b) terminates the Peanut Administrative
Committee.
Subsection (c) requires the Secretary to establish a Peanut
Standards Board for the purpose of assisting in the
establishment of quality standards with respect to peanuts. The
Secretary will appoint members to the Board that reflect all
regions and segments of the peanut industry.
Section 151 of the bill, in subsection (b), makes certain
conforming amendments to the Federal Agriculture Improvement
and Reform Act of 1996.
Section 152 of the bill, in subsection (a), repeals
existing authority for marketing quotas for peanuts, effective
beginning with the 2002 crop.
Subsection (b) provides for the compensation of quota
holders affected by the termination of marketing quotas for
peanuts; defines terms used in the subsection; and requires the
Secretary to offer contracts with peanut quota holders for the
purpose of providing compensation for the lost value of quota.
The Secretary is to make payments to eligible quota holders for
each of the fiscal years 2002 through 2006. Payments are to be
made in 5 equal installments and not later than September 30 of
each fiscal year. The amount of the payment for a fiscal year
will be determined by multiplying $0.10 per pound times the
established farm poundage quota (previously in effect).
Assignments of payments made to quota holders are subject to
existing law. The Secretary must be informed of the assignment
of payments made under this section.
Subsection (c) makes conforming amendments to the
Agricultural Adjustment Act of 1938.
Subsection (d) provides that section 152 and the amendments
made by the section will apply beginning with the 2002 crop of
peanuts.
Subtitle D--Administration
Section 161. Adjustment authority related to Uruguay Round compliance
This section allows the Secretary to adjust the amount of
expenditures if the Secretary determines that expenditures will
exceed total allowable domestic support levels under the
Uruguay Round Agreement on Agriculture.
Section 162. Suspension of permanent price support authority
This section suspends certain permanent price support
authority of the Agricultural Adjustment Act of 1938 and the
Agricultural Act of 1949 for the 2002 through 2006 crops.
Section 163. Commodity purchases
This section requires the Secretary to use funds of the
Commodity Credit Corporation to purchase additional
commodities, including specific minimum purchases of specialty
crops. Of the funds, not less than $50,000,000 each fiscal year
will be made available to the Secretary of Defense to purchase
fresh fruits and vegetables for distribution to schools and
service institutions, and not less than $40,000,000 each fiscal
year to purchase agricultural commodities for distribution
under the Emergency Food Assistance Act of 1983.
Section 164. Hard white wheat incentive payments
This section requires the Secretary to use $40,000,000 of
funds of the Commodity Credit Corporation to provide incentive
payments to producers of hard white wheat during the 2003
through 2005 crop years. The program offers wheat producers an
alternative crop to meet a growing international market
opportunity.
Section 165. Payment limitations
This section establishes a limitation of $100,000 for the
total of direct payments and counter-cyclical payments to a
person for all contract commodities during any fiscal year, and
a separate limitation of $100,000 for direct and counter-
cyclical payments for peanuts. The section establishes a
limitation of $150,000 for marketing loan gains and loan
deficiency payments for all contract commodities during any
crop year, and separate limitations of $150,000 for wool and
mohair, honey and peanuts.
Section 166. Regulations
This section allows the Secretary to promulgate regulations
to implement this title without regard to notice and comment
provisions of section 553 of title 5 United States Code.
Section 167. Effect of amendments
This section provides that, except as specifically
provided, the Secretary of Agriculture may carry out existing
programs for any of the 1996 through 2001 crop, fiscal or
calendar years under a provision of law in effect immediately
before the date of enactment of this Act.
TITLE II--CONSERVATION
Section 201. Conservation Security Program
This section amends Subtitle D of title XII of the Food
Security Act of 1985 by establishing a conservation incentive
program that pays producers to adopt or maintain conservation
practices on lands in production, as follows:
Section 1238. Definitions
This section defines terms used in the program.
Section 1238A. Conservation Security Program
Subsection (a). This subsection requires the Secretary to
establish a conservation security program beginning in fiscal
year 2003 that provides producers a payment to implement
practices that protect and enhance natural resources, including
soil, water, air, energy, wildlife habitat, wetlands,
biodiversity, carbon sequestration, and management of invasive
species.
Subsection (b). This subsection defines eligible providers
and eligible lands. It allows the Secretary to develop
conservation security plans with all willing producers with
lands in agricultural lands in production, including forest
land integrated in an agricultural operation. Lands enrolled in
CRP and WRP are not eligible for enrollment in the conservation
securityprogram. To further the advancement of conservation on
lands in production, the Secretary shall allow a producer to continue
economic uses of the land consistent with the objectives of the
conservation security plan.
Subsection (c). This subsection outlines the contents of
the conservation security plan, including the land enrolled,
resources protected, practices adopted or maintained, schedule
for implementation, and payment. Also, to encourage maximum
local participation, local and State conservation priorities
shall be developed and given priority in forming conservation
security plans. The section also requires the Secretary to
provide base and bonus payments upon approval of a contract.
Subsection (d). This subsection describes the eligible
conservation practices, including land management, vegetative,
and structural practices, and establishes the three tiers of
practices that may be adopted or maintained. Including payment
for maintaining practices ensures proper recognition of those
producers who already maintain conservation practices. The
program establishes three tiers of participation to ensure
maximum participation and flexibility for producers. Tier I
covers the basic level of practices, including nutrient, pest,
and air quality management, water conservation, and wildlife
habitat management that may apply to all or part of an
operation. Tier II includes practices that focus on systems
based approaches to land management, including partial field
practices, and wetland, grass and prairie restoration and
protection. Tier II practices must cumulatively address at
least one local resource of concern across the entire
operation. To qualify for Tier III a producer must adopt
practices that address all resources of concern on the entire
operation. In determining eligible practices, the Secretary
shall encourage the adoption of the lowest cost alternative,
but not in a manner that limits the adoption of innovative
practices. Producers with contracts at Tier II or Tier III may
participate in approved on-farm research and demonstration
projects. In determining eligible practices, the Secretary
shall use the National Handbook of Conservation Practices and
the field office technical guides of the Natural Resources
Conservation Service. To further develop new technologies, the
Secretary may approve pilot programs and research projects.
Subsection (e). This subsection describes the requirements
for a conservation security contract, including the term which
shall be five years for a Tier I contract and five-to-ten years
for a Tier II or Tier III contract, at the option of the
producer. Also, it describes the circumstances under which the
contract may be modified or terminated by the Secretary or the
producer. It further provides the conditions for renewal of a
conservation security contract.
Subsection (f). This subsection provides that a producer
shall not be in violation of a conservation security contract
for failure to comply due to circumstances beyond the
producer's control.
Section 1238B. Duties of Producers
This section describes the producer's duty to implement the
conservation security contract, to not violate the terms of the
contract directly or indirectly and to keep and provide to the
Secretary records showing implementation of practices required
under the contract.
Section 1238C. Duties of the Secretary
This section requires the Secretary to provide the producer
an advance payment of the greater of $1,000, or 20 percent of
the annual payment for Tier I, the greater of $2,000 or 20
percent of the annual payment for Tier II, or the greater of
$3,000 or 20 percent of the annual payment for Tier III at the
option of the owner or operator.
Subsection (b). This subsection establishes the payment
levels under each of the three Tiers. Payments may reach
$20,000 for Tier I, $35,000 for Tier II, and $50,000 for Tier
III. Payments are based on a combination of factors, including
a percentage of the average county rental rate or another
appropriate rate to ensure regional equity based on the 2001
rate. For the land enrolled under a CSP contract, a producer
automatically receives an average county rate equivalent to 6
percent for Tier I, 11 percent for Tier II and 20 percent for
Tier III.
In addition, a producer may receive a bonus payment for
practices that provide increased environmental benefits,
including practices that address national priority concerns,
participation in research projects, and the extent practices
exceed local priority concerns, and for participating in
watershed projects. A bonus payment is also provided to
beginning farmers and ranchers.
In addition, the legislation covers the cost of practices
based on the 2001 cost. The producer receives 100 percent of
the costs of adopting or maintaining management practices, 100
percent of the costs of maintaining land-based structural
practices and 75 percent of the cost of adopting new land-based
structural practices. To encourage increased conservation, the
total of the base rate plus costs cannot exceed 75 percent of
the maximum payment under the applicable tier. To ensure that
practices focus on land-based management practices, payments
are not provided for the cost of purchasing equipment or for
waste storage or treatment facilities. The payments under this
subsection shall not duplicate payments from other conservation
programs run by the Secretary. To be eligible for payment the
producer must meet the requirement of commensurate share.
Subsection (c). This subsection requires producers who must
meet conservation requirements under USDA run farm programs,
payments on the lands subject to those requirements cover only
those practices that exceed the minimal requirements for the
payments under the other programs.
Subsection (d). This section requires the Secretary to
issue regulations to ensure payments are made in accordance
with the objectives of the conservation security program.
Subsection (e). This subsection allows a producer in good
standing to terminate a conservation security contract without
penalty.
Subsection (f). This subsection requires the termination of
a conservation security contract upon transfer of ownership in
the land under contract, unless the transferee notifies the
Secretary in writing of his intention to continue the contract.
Subsection (g). This subsection provides up to 20 percent
for technical assistance.
Subsection (h). This subsection authorizes the Secretary to
establish a program in one eligible State for the State to run
the conservation security program in the selected State.
Section 202. Funding
This section provides that funds for the Conservation
Security Program shall come from the CCC.
Section 203. Partnerships and Cooperation
This section amends Section 1243 of the Food Security Act
of 1985 by authorizing the Secretary to designate special
projects to reflect local needs. Projects may focus on
environmental concerns including water conservation, irrigation
methods, conversion to non-irrigated crops, and nutrient
reduction. The Secretary may enter into special agreements with
States to specifically address local needs. The Secretary may
provide incentives to producers to encourage participation in
established special projects. In addition, the Secretary shall
use five percent of EQIP funds for the same special projects.
Section 204. Administrative Requirements for Conservation Programs
This section amends Subtitle E of title XII of the Food
Security Act of 1985 as follows:
Subsection (a). This subsection authorizes the Secretary to
provide relief to producers who relied in good faith on
inaccurate advice from an employee of the Secretary.
Subsection (b). This subsection requires the Secretary to
provide and coordinate administration (including contracting
with third parties) of the conservation programs to carry out
education, outreach, monitoring and evaluation under all
conservation programs, including socially disadvantaged,
beginning farmers and ranchers, Indian tribes, and limited
resource producers.
Subsection (c). This subsection authorizes the Secretary to
provide special incentives to limited resource producers,
Indian tribes and beginning farmers and ranchers.
Subsection (d). This subsection requires the Secretary to
maintain data to facilitate program administration.
Subsection (e). This subsection requires the Secretary to
offer mediation and informal hearings to producers adversely
affected by a decision under a conservation program.
Subsection (f). This subsection requires the Secretary to
provide technical assistance under all conservation programs
and authorizes the Secretary to contract directly with
qualified third parties to provide assistance, including
cooperative agreements with State, local or private
organizations. This subsection requires the Secretary to
establish criteria for third party certification and allows the
Secretary to contract with eligible third parties to provide
education, outreach, monitoring and evaluation and technical
assistance. To build upon existing certification programs, the
Secretary may grant a full or partial waiver for certification
and fee payment for individuals accredited through an
equivalent conservation program, as determined by the
Secretary. The Secretary may also provide assistance to non-
private providers, but only if the provision will lead to
increasing the base of conservation technical assistance
provided under the conservation programs.
Subsection (g). This subsection prohibits the Secretary
(and other federal agencies) from releasing information
gathered from producers through participation in conservation
programs, including information from conservation plans, unless
the information is provided in an aggregate form that does not
provide information specific to individual producers.
Subsection (h). This subsection requires the Secretary to
work with Indian tribes to ensure, to the maximum extent
possible, that conservation programs are administered in a fair
and equitable manner.
Section 205. Reform and Assessment of Conservation Programs
This amends the Food Security Act of 1985 as follows:
Subsection (a). This subsection requires the Secretary to
develop a plan for coordinating conservation programs to ensure
better implementation and delivery. It specifically requires
the Secretary to improve delivery of programs for Indian
tribes, including coordinating with the Secretary of the
Interior.
Subsection (b). This subsection requires the Secretary to
issue a report on the plan developed in subsection (a) no later
than 180 days after the enactment of this bill.
Subsection (c). This subsection requires the Secretary to
prepare a plan and budget for implementing the appraisal of the
soil, water and related resources contained in the National
Conservation Program. The Secretary must provide the plan to
Congress within 180 days after the enactment of this bill and
to provide Congress with a status report on the National
Conservation Program plan by April 30, 2005.
Section 206. Conservation Security Program Regulations
This subsection requires the Secretary to begin working on
implementation of the Conservation Security Program immediately
upon enactment of this legislation.
Section 207. Conforming Amendments
This section amends chapter 1 of subtitle D of title XII of
the Food Security Act of 1985 by renaming the Environmental
Conservation Acreage Reserve Program (ECARP) the Comprehensive
Conservation Enhancement Program (CCEP).
Section 211. Comprehensive Conservation Enhancement Program (CCEP)
Subsection (a). This subsection authorizes CCEP (replacing
ECARP) through 2006.
Subsection (b). This subsection provides that priority
under programs should go to areas that would facilitate the
most rapid completion of on-going projects.
Subsection (c). This subsection provides funding for
conservation programs, including technical assistance, through
fiscal year 2006.
Section 212. Conservation Reserve Program (CRP)
This section amends Chapter 4 of Subtitle D of Title XII of
the Food Security Act of 1985.
Subsection (a). This subsection extends the CRP through
fiscal year 2006.
Subsection (b). This subsection limits enrollment of highly
erodible lands that do not have a cropping history during the
last 3 of 6 years. This subsection also amends the continuous
enrollment program to allow lands without a cropping history to
be enrolled and allows full tracts of lands to be enrolled as
buffer if more than 50 percent of the land in the tract is
eligible for enrollment and the remaining acreage is not
feasible to farm. It codifies the continuous sign-up program
and Conservation Reserve Enhancement Program (CREP). It further
extends priority enrollment of lands that would facilitate
completion of ongoing projects.
Subsection (c). This subsection increases the maximum
enrollment from 36.4 million acres to 40 million acres.
Subsection (d). This subsection authorizes the Secretary to
extend hardwood tree contracts for 15 additional years with a
50 percent reduction in payment.
Subsection (e). This subsection authorizes the Pilot
Program through 2006 for enrollment of wetland and buffer
acreage in the CRP and modifies it to allow enrollment of 10-
acre tracts, but continues to provide payment for no more than
five acres.
Subsection (f). This subsection waives the requirement for
planting hardwood trees on marginal pasture land if native
prairie grass may be restored or maintained. It further allows
haying and grazing for management purposes for lands enrolled
through the CREP and the continuous sign-up program. It further
prohibits landowners with lands enrolled in CRP from breaking
out new highly erodible lands without a cropping history unless
the land is being used as a homestead or a building site at the
time of purchase of the land.
Subsection (g). This subsection authorizes the Secretary to
permit wind turbines on lands enrolled in the CRP with the
exception of lands enrolled through the continuous sign-up or
CREP.
Subsection (h). This subsection requires the Secretary to
provide full and equal signing and practice incentive payments
on all lands enrolled through CREP and continuous CRP sign-up
(at the highest rate currently paid).
Subsection (i). This subsection excludes lands enrolled in
the CREP and continuous sign-up program from being included in
the 25 percent cap on lands enrolled in a county.
Subsection (j). This subsection requires the Secretary to
provide Congress with a report on the economic impacts of the
CRP on rural communities no later than 270 days after
enactment.
Section 213. Wetlands Reserve Program (WRP)
This section amends the Food Security Act of 1985.
Subsection (a). This subsection amends the provision on
funding to include technical assistance.
Subsection (b). This subsection raises the total acreage
cap by 1.25 million acres and requires the Secretary to enroll
250,000 acres annually, to the maximum extent possible.
Subsection (c). This subsection reauthorizes the WRP
through fiscal year 2006.
Subsection (d). This subsection authorizes the Secretary to
enroll up to 25,000 acres annually in a Wetlands Reserve
Enhancement Program. The Wetlands Reserve Enhancement Program
authorizes the Secretary to coordinate with State and local
governments and private organizations to focus resources on
critical environmental needs.
Subsection (e). This subsection authorizes the use of
technical assistance to include monitoring and maintenance.
Section 214. Environmental Quality Incentives Program (EQIP)
This amends the Food Security Act of 1985.
Section 1240. Purposes
This subsection defines the purposes of EQIP.
Section 1240A. Definitions
This section provides the definition of terms used in EQIP.
Section 1240B. Establishment and Administration of Environmental
Quality Incentives Program
Subsection (a). This subsection reauthorizes EQIP through
fiscal year 2006 to allow the Secretary to provide technical
assistance, cost-share, and incentive payments to eligible
producers, defines the eligible practices, and authorizes the
Secretary to provide education to producers.
Subsection (b). This subsection changes the minimum
contract length to three years (from five years), but limits
the number of contracts for structural practice involving
livestock nutrient management to one contract during the fiscal
years 2002-2006.
Subsection (c). This subsection requires the Secretary to
establish a process for selecting applications and eliminates
bidding down of their contracts.
Subsection (d). This subsection provides for up to 75
percent cost share for practices in general, but provides cost-
share assistance of 90 percent to limited resource and
beginning producers.
Subsection (e). This subsection authorizes the Secretary to
provide incentives to producers.
Subsection (f). This subsection authorizes the Secretary to
provide technical assistance, including provision of payment to
a producer to get third party technical assistance. This
subsection also provides special certification provisions for
technical assistance under EQIP.
Subsection (g). This subsection provides terms and
conditions for modification or termination of EQIP contracts.
Section 1240C. Evaluation of Offers and Payments
Subsection (a). Provides priority for accepting offers
under EQIP.
Section 1240D. Duties of Producers
This section provides the duties of the participating
producers, including implementing a conservation plan.
Section 1240E. Environmental Quality Incentives Program Plan
Subsection (a). This subsection requires producers to
submit a plan to be eligible for payments under EQIP.
Subsection (b). This subsection requires the Secretary to
eliminate duplication in planning.
Section 1240F. Duties of the Secretary.
This subsection spells out the obligations of the
Secretary.
Section 1240G. Limitation of Payments
The legislation provides cost-share assistance to all
producers, including all livestock producers and increases the
total amount a producer may receive under a contract to
$150,000, with an annual limit of $50,000. The Secretary must
make all efforts to ensure that payment limitations are
followed.
Section 1240H. Conservation Innovation Grants
Subsection (a). This authorizes the Secretary to provide up
to $100 million annually for fiscal years 2003-2006, in
conservation innovation grants.
Subsection (b). This subsection authorizes the Secretary to
award grants under subsection (a) to governmental and non-
governmental organizations on a competitive basis.
Subsection (c). This subsection limits federal cost-share
to 50 percent.
Subsection (d). This subsection requires that unused funds
be available for use under EQIP.
This subsection provides the following funding levels for
EQIP: for fiscal year 2002: $500 million; for fiscal year 2003:
$1.05 billion; for fiscal year 2004: $1.2 billion; for fiscal
year 2005: $1.2 billion; and for fiscal year 2006: $1.25
billion.
Section (c). Reimbursements. This section amends Section 11
of the Commodity Credit Corporation Charter Act to allow
funding for conservation technical assistance.
This section amends Subtitle H of title XV of the
Agriculture and Food Act of 1981 as follows:
Section 1528. Definitions
This section defines term used in this section.
Section 1529. Resource Conservation and Development Program
This section permanently authorizes the Resource
Conservation and Development program.
Section 1530. Selection of Designated Areas
This section authorizes the Secretary to designate areas
for assistance.
Section 1531. Powers of the Secretary
This section authorizes the Secretary to provide technical
and financial assistance and enter into agreements with the
councils.
Section 1532. Eligibility; Terms and Conditions
Subsection (a). This subsection authorizes the Secretary to
provide assistance for carrying out an approved project if
specific criteria are met, at the discretion of the Secretary.
Subsection (b). This subsection authorizes the Secretary to
provide loans.
Subsection (c). This subsection requires provision of
assistance conditioned on approval of a plan by the Secretary.
Subsection (d). This subsection allows the Secretary to
withdraw assistance.
Subsection (e). This subsection allows the Councils to
obtain outside assistance.
Section 1533. Resource Conservation and Development Policy Advisory
Board
Subsection (a). This subsection requires the Secretary to
establish a resource conservation and development policy
advisory board.
Subsection (b). This subsection provides for the
composition of the board in subsection (a).
Subsection (c). This subsection provides for the duties of
the board.
Section 1534. Evaluation of Program
Subsections (a) and (b). These subsections require the
Secretary to evaluate the program and provide Congress with a
report no later than June 30, 2005.
Section 1535. Limitation of Assistance
This section limits the number of councils to 450.
Section 1536. Supplemental Authority of the Secretary
This section authorizes the Secretary to retain additional
authorities beyond what is provided in this section.
Section 1537. Authorization of Appropriations
Subsections (a), (b) & (c). This subsection authorizes
appropriations of sums necessary to carry out the program and
up to $15,000,000 for loans.
Section 216. Wildlife Habitat Incentives Program
This section amends Chapter 5 of subtitle D of title XII of
the Food Security Act of 1985 as follows:
Section 1240M. Wildlife Habitat Incentive Program
Subsection (a). This subsection defines the terms used in
this section.
Subsection (b). This subsection establishes the wildlife
habitat incentive program.
Subsection (c). This subsection reauthorizes the provisions
for cost-share and requires the Secretary to reserve not less
than 15 percent of funds for projects focusing on threatened
and endangered species.
Subsection (d). This subsection authorizes a pilot program
to use up to 15 percent of the available funds to enroll lands
for 15 years or longer for critical habitat or species.
Subsection (e). This subsection provides for funding. For
fiscal year: 2002: $50 million; for fiscal year 2003: $100
million; for fiscal year 2004: $100 million; for fiscal year
2005: $125 million; and for fiscal year 2006: $125 million.
Section 1240N. Watershed Risk Reduction
This section amends the Food Security Act of 1985 as
follows:
Subsection (a). This subsection authorizes the Secretary to
provide assistance, including the ability to purchase flood
plain easements, in watersheds impaired by natural occurrences
in order to safeguard lives and property.
Subsection (b). This subsection requires the Secretary to
give priority to impacted areas adjacent to a major river.
Subsection (c). This subsection prohibits use of funds for
the same projects from any Federal disaster relief program.
Subsection (d). This subsection authorizes the
appropriation of $15,000,000 annually for each of the fiscal
years 2002 through 2006.
Section 1240O. Great Lakes Basin Program for Soil Erosion and Sediment
Control
This section amends the Food Security Act of 1985 as
follows:
Subsection (a). This subsection authorizes the Secretary to
carry out the Great Lakes Basin Program for Soil Erosion and
Sediment Control.
Subsection (b). This subsection authorizes the Secretary to
provide grants, technical assistance, and education programs.
Subsection (c). This subsection authorizes the
appropriation of $5,000,000 annually for each of the fiscal
years 2002 through 2006.
Section 1240P. Conservation of Private Grazing Land Initiative (CPGL)
This section amends the Food Security Act of 1985 by
reauthorizing the CPGL through fiscal year 2006 for $60 million
annually.
Section 217. Farmland Protection Program (FPP)
Subsection (a). This section amends Chapter 2 of the Food
Security Act of 1985 as follows:
Section 1238H. Definitions
This section provides for definition of terms used in FPP.
It expands FPP to allow private non-profit organizations to
participate.
Section 1238I. Farmland Protection
Subsections (a) and (b). These subsections establish FPP
and also establish the requirement that highly erodible land
have a conservation plan.
This subsection authorizes the Secretary to use up to $10
million annually for Farm Viability Grants for participating
farms and ranches to develop business plans.
Subsection (b). This subsection provides for program
funding of $150 million for fiscal year 2002; $200 million for
fiscal years 2003 and 2004; $225 million for fiscal year 2005;
and $250 million for fiscal year 2006.
Subsection (c). This subsection repeals FPP from the 1996
FAIR Act.
Section 218. Grassland Reserve Program (GRP)
This section amends Chapter 2 of the Food Security Act of
1985.
Section 1238N. Grassland Reserve Program
Subsection (a). This subsection establishes a new Grassland
Reserve Program.
Subsection (b). This subsection provides for enrollment of
up to 2 million acres of natural grassland through 30-year and
permanent easements and 30-year rental agreements.
Subsection (c). This subsection makes eligible natural
grassland that can be restored or protected.
Section 1238O. Easements or Agreements
Subsection (a). This subsection sets out the requirements
for a landowner to participate in the program.
Subsection (b). This subsection provides for allowed and
prohibited practices.
Subsection (c). This subsection provides for ranking of
applications.
Subsection (d). This subsection provides the terms for
restoration of grass or shrubland.
Subsection (e). This subsection provides for terms or
conditions upon violation of an easement or restoration
agreement.
Section 1238P. Duties of Secretary
Subsection (a)-(e). These subsections provide for the
duties of the Secretary, including rental and easement
payments, provision of technical assistance, and payment for
cost of restoration.
Subsection (f). This subsection allows for payments from
additional federal programs.
Subsection (g). This subsection requires the Secretary to
issue regulations.
(b) Funding. This section provides for funding from the
Commodity Credit Corporation.
Section 219. State Technical Committees
This section amends Subtitle G of title XII of the Food
Security Act of 1985.
Section 1261. Establishment
Subsection (a). This subsection requires the Secretary to
establish in each State a technical committee.
Subsection (b). This subsection requires the Secretary to
develop standards for the technical committees.
Subsection (c). This subsection describes the composition
of the State technical committees.
Section 1262. Responsibilities
Subsection (a). This subsection requires the technical
committees to provide recommendations to the Secretary and
provide for public participation at meetings.
Subsection (b). This subsection provides for duties and
responsibilities of the technical committees.
Subsection (c). This subsection provides for the advisory
capacity of the committees.
Subsection (d). This subsection provides that the technical
committees shall be exempt from FACA (this is current law).
Subsection (e). This subsection provides for the
establishment and responsibilities of subcommittees.
Section 220. Use of Symbols, Slogans, and Logos
This section amends the 1996 Farm Bill to authorize the
Secretary to use, license or transfer symbols, slogans and
logos of the Department and use all revenues to carry out
conservation programs.
TITLE III--TRADE
Subtitle A
Section 301. U.S. Policy
This section amends the Agricultural Trade Development and
Assistance Act by adding conflict resolution as a policy
objective for U.S. food aid programs.
Section 302. Provision of Agricultural Commodities
This section amends Section 202(b) of the Agricultural
Trade Development and Assistance Act as follows:
Program Diversity--In paragraph (1), the Administrator of
the U.S. Agency for International Development is required to
consider proposals for PL-480, Title II projects that address
any of the program objectives established in law, including
famine, malnutrition, economic and community development, sound
environmental practices, and feeding programs.
Paragraph (2) changes the amount of administrative expenses
that may be compensated for such projects from a dollar range
($10 million to $28 million) to a range of percentages (between
5 and 10 percent) of the value of commodities used.
Certified Institutional Partners--Paragraph (3) requires
the Administrator of US-AID or the Secretary to develop
regulations to permit private voluntary organizations (PVO's)
to be certified as institutional partners by providing evidence
of their organizational capacity. Once certified, such PVO's
would be eligible to submit a single proposal for programs in
countries in which such capacity has been documented, and
receive expedited review.
Section 303. Generation and Use of Currencies by Private Voluntary
Organizations and Cooperatives
This section amends the Agricultural Trade Development and
Assistance Act by permittingproceeds of sales of commodities
for Title II food aid projects to be denominated in currencies other
than the local currency. Such sales may be conducted in one or more
countries.
Section 304. Levels of Assistance
This section amends the Agricultural Trade Development and
Assistance Act by increasing the minimum authorized tonnage for
Title II from 2.025 million tons annually to 2.5 million tons
annually by the end of the bill.
Paragraph (2) defines crude degummed soybean oil as an
eligible value-added commodity for shipment under Title II non-
emergency programs.
Section 305. Food Aid Consultative Group
This section amends the Agricultural Trade Development and
Assistance Act by clarifying what kinds of documents governing
the program must be reviewed by the consultative group.
Paragraph (3) extends the authority for the group for the
life of the farm bill.
Section 306. Maximum Level of Expenditures
This section amends the Agricultural Trade Development and
Assistance Act by raising the cap on food aid spending under
that Act from $1 billion annually to $2 billion annually.
Section 307. Administration
This section amends Section 207(a) of the Agricultural
Trade Development and Assistance Act as follows:
Recipient Countries--Paragraph (1) requires that proposals
for non-emergency food aid projects identify the country or
countries in which the project is to be conducted. It also
requires the Administrator of US-AID to act on project
proposals within 120 days of submission.
Paragraph (2) adds guidelines to the type of documents
which US-AID must submit to the Federal Registry for public
comment.
Paragraph (3) permits PVO's to directly schedule delivery
of commodities under approved agreements from the Commodity
Credit Corporation.
Timely Approval--Paragraph (4) adds at the end of Section
207 a new subsection which requires the Administrator to
finalize program agreements before the beginning of each fiscal
year, and submit a report on those approvals to the appropriate
Congressional Committees no later than December 1 of that
fiscal year.
Direct Delivery--Under paragraph (5), in addition to other
established practices, the Secretary may approve direct
delivery of eligible commodities to mills or other processing
facilities in recipient countries which are majority-owned by
U.S. citizens. The proceeds of such transactions are to be
transferred to eligible organizations to carry out approved
projects
Section 308. Assistance for Stockpiling and Rapid Transportation,
Delivery, and Distribution of Shelf-stable Pre-Packaged Foods
This section amends the Agricultural Trade Development and
Assistance Act by extending this program through 2006. Under
this provision, the Administrator may make grants to eligible
organizations to prepare and store shelf-stable prepackaged
foods for carrying out food aid projects. This program is
authorized for appropriations at $3 million annually.
Section 309. Sales Procedure
This section amends Section 403 of the Agricultural Trade
Development and Assistance Act by adding the following:
In General--Paragraph (1) requires that sales of
commodities for food aid projects conducted under Section
416(b) of the Agricultural Act of 1949, and section 1110 of the
Food for Progress Act avoid disruption of local farmers and
markets.
Currencies--Paragraph (2) allows commodities to be
monetized in dollars or other currencies under Title II
programs.
Sale Price--Paragraph (3) requires that sales be made at
prices that are reasonable for that particular market, as
determined by the Administrator or Secretary, as appropriate.
Section 310. Prepositioning
This section amends the Agricultural Trade Development and
Assistance Act by extending the Administrator's authority to
use funds to store commodities in locations that are more
convenient for quick shipment under emergency conditions.
Section 311. Expiration Date
This section amends the Agricultural Trade Development and
Assistance Act by extending the authority for appropriations
for projects and assistance under Titles I and II of PL-480.
Section 312. Micronutrient Fortification Program
Paragraphs (1) and (2) section amends the Agricultural
Trade Development and Assistance Act by ending this program's
pilot status.
Paragraph (3) extends the program until 2006.
Section 313. Farmer to Farmer Program
This section amends the Agricultural Trade Development and
Assistance Act by increasing the share (from 0.4 percent to 0.5
percent) of Title I and Title II funding which can be assigned
for support of this program. Paragraph (2) extends the
authority for the Farmer-to-Farmer program, which funds
technical exchanges between U.S. farmers and farmers in
developing countries.
Subtitle B
Section 321. Export Credit Guarantee Program
This section amends the Agricultural Trade Act as follows:
Term of Supplier Credit--Subsection (a) extends the
potential length of loans under the Supplier Credit Program
from 6 months to 12 months.
Processed and High-Valued Products--Subsection (b) extends
through 2006 the requirement that not less than 35 percent of
products exported under U.S. agricultural export credit
programs be processed or high-valued products.
Report--Subsection (c) requires the Secretary to submit an
annual report to the appropriate Congressional Committees on
the status of multilateral negotiations on agricultural export
credit programs under the auspices of the Organization for
Economic Cooperation and Development. Such negotiations have
been held in keeping with Article 10.2 of the Uruguay Round
Agreement on Agriculture. The report shall be submitted in
unclassified form, but may contain a classified annex.
Reauthorization--Subsection (d) extends authority for
Export Credit Guarantee Programs through 2006.
Section 322. Market Access Program
This section amends the Agricultural Trade Act of 1978 as
follows:
In general--Subsection (a) increases funding for the Market
Access Program, at the following levels: not less than $100
million for fiscal year 2002, $120 million for fiscal year
2003, $140 million for fiscal year 2004, $160 million for
fiscal year 2005, and $190 million for fiscal year 2006.
Program priorities--Paragraph (2) establishes priority for
new program participants and programs in emerging markets for
amounts available above existing level of $90 million.
United States Quality Export Initiative--Subsection (b)
contains findings, including that: (1) the market access
program and foreign market development program target generic
and value-added agricultural products, with little emphasis on
the high quality of a United States product; and (2) new
promotional tools are needed to enable United States products
to compete in higher margin, international markets on the basis
of quality.
Paragraph (2) creates a quality export initiative program
under which the Secretary develops program under which, on a
competitive basis, several high-quality U.S. agricultural
products are identified. U.S. agricultural products so
identified will be permitted to carry the `U.S. Quality' seal,
and promoted at trade fairs and through electronic and print
media. This initiative is subject to the availability of
appropriations.
Section 323. Export Enhancement Program
This section amends the Agricultural Trade Act of 1978 by
extending the Export Enhancement Program through 2006.
Subsection (a) makes up to $478 million available annually from
the Commodity Credit Corporation for the purpose of encouraging
commercial sales of U.S. agricultural commodities.
Unfair Trade Practices--Subsection (b) expands the
definition of unfair trade practices to include defines
exchange rate manipulation by competing exporters and
questionable pricing practices by State trading enterprises.
Under the Act, use of such practices by competing exporters may
trigger use of the Export Enhancement Program, although it is
not limited to such purposes.
Section 324. Foreign Market Development Cooperator Program
This section amends the Agricultural Trade Act of 1978 by
increasing funds available to the Foreign Market Development
Cooperator Program out of mandatory money at the following
levels: $37.5 million for fiscal year 2002, $40 million for
fiscal year 2003, $42.5 million for fiscal year 2004 and
subsequent years.
Program Priorities--Subsection (b) establishes priority for
new program participants and programs in emerging markets for
amounts available above $35 million.
Section 325. Food for Progress and Education Programs
This section amends the Agricultural Trade Act of 1978 by
adding a Food for Progress and Education Program title at the
end of the statute, as follows:
Section 801 includes definitions
Food for Progress and Education Programs. Section 802
authorizes these programs under which donated commodities are
provided to eligible organizations which agree to conduct
development projects in recipient countries. It establishes the
Food for Progress Program, which may be entered into with the
following organizations--
(1) governments of emerging democracies;
(2) private voluntary organizations;
(3) nonprofit agricultural organizations and
cooperatives;
(4) intergovernmental organizations; and
(5) other private entities.
Considerations--Subsection (b) requires the Secretary to
examine an emerging agricultural country before approving
program agreements, including the following determinations:
(1) whether or not the country is committed to providing
economic freedom; (2) whether or not the country carries out
policies which promote private production of food for domestic
consumption; and (3) whether or not the country is committed to
the creation and expansion of efficient domestic markets for
the purchase and sales of those commodities.
International Food for Education and Nutrition Program--
This program is established in subsection (c), under which the
Secretary may provide agricultural commodities and technical
assistance in connection with education programs in recipient
countries.
Paragraph (2) provides the Secretary the authority to enter
into agreements with eligible organizations to purchase,
acquire and donate commodities and to provide technical and
nutritional assistance.
Under paragraph (3), the Secretary is required to encourage
other donor countries to contribute goods and funds and provide
technical and nutritional assistance to recipient countries.
Paragraph (4) urges the President and Secretary to
encourage private sector participation in this program.
Paragraph (5) includes a graduation provision, in order to
determine how benefits could be sustained in a recipient
country when the program terminates.
Paragraph (6) requires the Secretary to report to the
appropriate Congressional Committees on the results of
implementing this section, and the level of commitment by other
donor countries to the program.
Terms--In subsection (d), the Secretary may provide
agricultural commodities under this title either on a grant
basis or on credit terms. Credit is established on the same
basis as under PL- 480, Title I concessional financing of
agricultural exports.
Paragraph (3) bars making commodities available under this
section if such action will reduce the amount of the commodity
that is traditionally made available for domestic feeding
programs.
Reports--Subsection (e) requires eligible organizations
with agreements under this title to submit reports to the
Secretary containing such information as is required relating
to the use of commodities and funds provided for said
agreements.
Coordination--Subsection (f) requires that assistance under
this title shall be coordinated with other forms of foreign
assistance under the mechanism designated by the President.
Quality Assurance--Subsection (g) requires the Secretary to
ensure that each eligible organization is optimizing the use of
donated commodities, as follows: (1) taking into account the
needs of target populations in recipient countries; (2) working
with recipient countries and institutions or groups within
those countries to design mutually acceptable programs; (3)
monitor and report on distribution and sale of eligible
commodities using accurate and timely reporting methods;
(4) periodically evaluate the eligible organization's
program effectiveness; and (5) consider means of improving
program operation.
Paragraph (2) requires the Secretary to develop regulations
to permit PVO's to be certified as institutional partners by
providing evidence of their organizational capacity. Once
certified, such PVO's would be eligible to submit a single
proposal for programs in countries in which such capacity has
been documented, and receive expedited review. The Secretary is
encouraged to enter into multi-year agreements, if commodities
are available and all other requirements of the program have
been satisfied.
Transshipment and Re-Sale--In subsection (h), transshipment
or re-sale within a country other than a recipient country are
prohibited unless approved by the Secretary.
Under paragraph (2), eligible commodities may be sold or
bartered only with the Secretary's approval within the
recipient country or a nearby country. If the Secretary
determines that such sales are not practicable, he or she may
permit sales or barters within other countries if such sales
will not disrupt commercial markets for the agricultural
commodities involved. The Secretary may authorize the use of
proceeds to reimburse costs incurred by an eligible
organization for the following purposes: (1) programs targeted
at hunger and malnutrition; (2) development programs involving
food security or education; (3) transportation, storage, and
distribution of eligible commodities; and (4) administration,
sales, monitoring, and technical assistance.
As appropriate, the Secretary may provide commodities in a
manner that will encourage development of private sector market
infrastructure.
Displacement of Commercial Sales--Under subsection (i), to
the maximum extent practicable, the Secretary is required to
avoid: (1) displacing commercial sales of U.S. commodities; (2)
disrupting world agricultural prices; or (3) disrupting normal
commercial trade patterns.
Deadline for Program Announcements--In subsection (j), the
Secretary is required to make program agreements and
allocations and announce them before the beginning of each
fiscal year (to the maximum extent practicable).
Paragraph (2) requires the Secretary to submit a list of
those allocations to the appropriate Congressional Committees
not later than November 1.
Program Limitations--In subsection (k), agricultural
commodities shall be made available under this title without
regard to political, geographic, ethnic, or religious identity
of the recipient.
In paragraph (2), the Secretary is barred from providing
commodities under any agreement that requires or permits the
distribution or handling of those commodities by any military
forces, except when non-military channels are not available and
the Secretary deems that conditions require such distributions
occur.
In paragraph (3), the Secretary is required to encourage
all parties in such a conflict to permit safe passage for
movement of relief supplies and safe zones for treatment and
evacuation of wounded persons.
Budget--Under subsection (l) , the cost of commodities and
related expenses under this title shall be in addition to the
level of assistance provided under the Agricultural Trade
Development and Assistance Act.
Paragraph (2) precludes such spending from being considered
expenditures for international affairs and finance.
Commodity Credit Corporation--Under subsection (m), funds,
facilities, and authorities of the Commodity Credit Corporation
may be used to carry out this title.
Paragraph (2) provides for a minimum tonnage of 400,000
metric tons per year for this title.
Paragraph (3) allows additional funds to be appropriated
for this title.
Paragraph (4) permits the Corporation to use funds
appropriated for Title I programs to carry out this title.
Paragraph (5) allocates no more than $200,000,000 of
available funds for each fiscal year to be used to carry out
the International Food for Education and Nutrition Program.
Tons not allocated by June 30 of each fiscal year shall be made
available for proposals under Food for Progress.
Paragraph (6) allows commodities to be purchased for this
program only if CCC inventories are insufficient to satisfy
commitments under approved agreements.
Under Paragraph (7), the Secretary is authorized to pay the
following costs for the program: (1) acquisition; (2) packaging
and fortifying the commodity; (3) processing and handling
before f.o.b. delivery; (4) ocean freight; (5) transport costs
for landlocked or otherwise inaccessible countries; (6)
transportation costs for moving commodities from designated
points of entry to storage and distribution sites; (7) internal
transport costs for the International Food for Education and
Nutrition program for recipient countries which are also low-
income net food-importing countries and have demonstrated a
commitment to education; (8) charges for general average
contributions arising out of the ocean transport of commodities
transferred; and (9) assistance for administration, monitoring,
and technical assistance.
Except for the costs of acquiring the commodities, these
costs may not exceed $80 million per year.
Conforming Amendment--Subsection (n) repeals section 1110
of the Food Security Act of 1985.
Section 326. Exporter Assistance Initiative
This section amends the Agricultural Trade Act of 1978, and
contains findings in subsection (a), including the following:
(1) information in the possession of Federal agencies other
than USDA that is necessary for the export of agricultural
products is available only from multiple, disparate sources;
and (2) because exporters often need access to information
quickly, exporters lack the time to search multiple sources to
access necessary information, and exporters often are unaware
of where the necessary information can be located.
Under subsection (b), the Secretary is required to develop
a website that collects all pertinent information from the
agencies of the Federal government to assist aspiring
agricultural exporters learn all they need to know about
getting started. Authorization of appropriations is provided,
at the following levels: $1 million for fiscal years 2002
through 2004, and $500 thousand for fiscal years 2005 and 2006.
Subtitle C
Section 331. Emerging Markets
This section amends the Food, Agriculture, Conservation and
Trade Act of 1990, by extending this program through 2006. This
program which offers funding for technical assistance for
developing market infrastructure in new market economies, such
as the countries of the Former Soviet Union.
Section 332. Biotechnology and Agricultural Trade Program
This section amends the Food, Agriculture, Conservation and
Trade Act of 1990 by establishing a program in USDA intended to
assist exporters.
Paragraph (2) establishes the focus of the program,
exporters facing market access, regulatory, and marketing
problems in exporting biotech-based products.
Paragraph (3) determines that U.S. market development
organizations concerning biotechnology shall target the
following foreign groups: producers, buyers, consumers, media,
government officials, scientists, and trade officials. This
support may be used through the following programs: (1) the
emerging markets program; (2) the Cochran Fellowship; or (3)
the Foreign Market Development Program.
Under paragraph (4), the Secretary shall assist exporters
of agricultural commodities in situations in which exporters
are harmed by unwarranted and arbitrary barriers to trade due
to marketing of biotechnology products, food safety, disease,
or other sanitary or phytosanitary concerns. These activities
are authorized appropriations of $1 million for fiscal years
2002 through 2006.
Under paragraph (5), CCC funding shall be available at $15
million for each of fiscal years 2002 through 2006, except for
paragraph (4).
Section 333. Surplus Commodities for Developing or Friendly Countries
This section amends Section 416(b) of the Agricultural Act
as follows:
Use of Currencies--Subsection (a) permits sales of eligible
commodities in recipient countries to be transacted in
currencies other than the local currency.
Implementation of Agreements--Under subsection (b), in
addition to other established practices, the Secretary may
approve direct delivery of eligible commodities to mills or
other processing facilities in recipient countries which are
majority-owned by U.S. citizens. The proceeds of such
transactions are to be transferred to eligible organizations to
carry out approved projects.
Certified Institutional Partners--Requires the Secretary
under subsection (c) to develop regulations to permit private
voluntary organizations (PVO's) to be certified as
institutional partners by providing evidence of their
organizational capacity. Once certified, such PVO's would be
eligible to submit a single proposal for programs in countries
in which such capacity has been documented, and receive
expedited review.
Section 334. Bill Emerson Humanitarian Trust
This section extends the Bill Emerson Humanitarian Trust
Act through 2006. The Act provides for government purchase and
storage of up to 4 million tons of commodities to maintain a
food security reserve.
Section 335. Agricultural Trade with Cuba
This section amends the Agriculture, Rural Development,
Food and Drug Administration and Related Agencies
Appropriations Act, 2001, by striking restrictions on private
financing of sales of food and medicine to Cuba.
Section 336. Sense of Congress Resolution Concerning Agricultural Trade
This section establishes Congressional priorities and
concerns for bilateral and multilateral agricultural trade
negotiations, as follows:
Agricultural Trade Negotiating Objectives--Subsection (a)
establishes the sense of Congress that the principal
negotiating objective of the United States with respect to
agricultural trade in all multilateral, regional, and bilateral
negotiations is to obtain competitive opportunities for the
export of United States agricultural commodities in foreign
markets substantially equivalent to the competitive
opportunities afforded foreign exports in United States markets
and to achieve fairer and more open conditions of agricultural
trade in bulk and value-added commodities by--
(1) reducing or eliminating, by a date certain,
tariffs or other charges that decrease market
opportunities for exports of United States agricultural
commodities, giving priority to products that are
subject to significantly higher tariffs or subsidy
regimes of major producing countries;
(2) immediately eliminating all export subsidies on
agricultural commodities while maintaining bona fide
food aid and preserving United States agricultural
market development and export credit programs that
allow the United States to compete with other foreign
export promotion efforts;
(3) leveling the playing field for United States
agricultural producers by disciplining domestic
supports such that no other country can provide greater
support, measured as a percentage of total agricultural
production value, than the United States does while
preserving existing green box category to support
conservation activities, family farms, and rural
communities;
(4) developing, strengthening, and clarifying rules
and effective dispute settlement mechanisms to
eliminate practices that unfairly decrease United
States market access opportunities for United States
agricultural commodities or distort agricultural
markets to the detriment of the United States,
including--
unfair or trade-distorting
activities of State trading enterprises and
other administrative mechanisms, with emphasis
on--
requiring price transparency in the
operation of State trading enterprises and such
other mechanisms; and
ending discriminatory pricing
practices that amount to de facto export
subsidies so that the enterprises or other
mechanisms do not (except in cases of bona fide
food aid) sell in foreign markets at prices
below domestic market prices or prices below
the full costs of acquiring and delivering
agricultural products to the foreign markets;
unjustified trade restrictions or
commercial requirements affecting new
technologies, including biotechnology;
unjustified sanitary or
phytosanitary restrictions, including
restrictions that are not based on scientific
principles, in contravention of the Uruguay
Round Agreements;
other unjustified technical barriers
to trade; and
restrictive and nontransparent rules
in the administration of tariff rate quotas;
(5) improving import relief mechanisms to recognize
the unique characteristics of perishable agriculture;
(6) taking into account whether a party to the
negotiations has--
failed to adhere to the provisions
of an existing bilateral trade agreement with
the United States; or
circumvented obligations under a
multilateral trade agreement to which the
United States is a signatory; or
manipulated its currency value to
the detriment of United States agricultural
producers or exporters; and
(7) otherwise ensuring that countries that accede to
the World Trade Organization--
have made meaningful market
liberalization commitments in agriculture; and
make progress in fulfilling those
commitments over time.
Priority for Agriculture Trade.--Subsection (b) further
establishes that it is the sense of Congress that: (1) reaching
a successful agreement on agriculture should be the top
priority of United States negotiators in World Trade
Organization talks; and (2) if the primary competitors of the
United States do not reduce their trade distorting domestic
supports and eliminate export subsidies in accordance with the
negotiating objectives expressed in this section, the United
States should take steps to increase the leverage of United
States negotiators and level the playing field for United
States producers in order to improve United States farm income
and to encourage United States competitors to eliminate export
subsidies and domestic supports that are harmful to United
States farmers and ranchers.
Consultation with Congressional Committees.--Subsection (C)
establishes the sense of Congress that:
(1) Before the United States Trade Representative
negotiates a trade agreement that would reduce tariffs on
agricultural products or require a change in United States
agricultural law, the United States Trade Representative shall
consult with the Committee on Agriculture, Nutrition and
Forestry and the Committee on Finance of the Senate and the
Committee on Agriculture and the Committee on Ways and Means of
the House of Representatives.
(2) Not less than 48 hours before initialing an agreement
relating to agricultural trade negotiated under the auspices of
the World Trade Organization, the United States Trade
Representative shall consult closely with the committees
referred to in paragraph (1) regarding--
(A) the details of the agreement;
(B) the potential impact of the agreement on United
States agricultural producers; and
(C) any changes in United States law necessary to
implement the agreement.
(3) Any agreement or other understanding (whether verbal or
in writing) that relates to agricultural trade that is not
disclosed to the Congress before legislation implementing a
trade agreement is introduced in either house of Congress shall
not be considered to be part of the agreement approved by
Congress and shall have no force and effect under Unites States
law or in any dispute settlement body.
TITLE IV--NUTRITION
Subtitle A--Food Stamp Program
Section 411. Simplified definition of income
This section allows a State option to exclude, from food
stamp eligibility determination, certain types of income if the
State also excludes them in its Temporary Assistance for Needy
Families (TANF) cash assistance or Medicaid programs. It also
allows States to exclude two infrequently received types of
income that are disregarded in other programs, including
certain educational benefits and ``complementary assistance''
(such as payments for unusual circumstances, like
transportation for the disabled). In addition, the section
requires that wages and salaries, social security benefits,
regular payments from a government source, workers'
compensation, and child support be counted as income. Finally,
the section directs the Secretary to promulgate regulations to
identify other sources of income that are essential to a fair
determination of food stamp eligibility. States are not
permitted to exclude from income calculations sources of income
identified in USDA regulations, regardless of their TANF or
Medicaid policies.
Section 412. Encouragement of payment of child support
Subsection (a) allows a State option to replace the current
deduction from income for amounts paid in child support with an
income exclusion in the same amount.
Subsection (b) states that a State is allowed to continue
to provide a child support deduction, rather than an exclusion,
and requires that if a State elects to provide a deduction, it
must determine the deduction before computing the excess
shelter expense deduction. The subsection also permits States
to use information from child support enforcement agencies to
determine the amount of child support paid and allows States to
freeze the amount deducted or excluded for child support
between eligibility reviews.
Section 413. Increase in benefits to households with children
This section increases the standard deduction by tying it
to the Federal poverty income guideline, according to household
size and indexes it for inflation. For fiscal years 2002-2007,
it would be 8 percent; for fiscal year 2008, 8.25 percent; for
fiscal years 2009-2010, 8.50 percent; and for fiscal year 2011,
9 percent. The standard deductions would not be less than those
provided under current law, nor more than the appropriate
applicable percentage of the poverty guideline for a household
of six. Finally, special provisions are included to ensure that
Guam's standard deduction level will be maintained.
Section 414. Simplified determination of housing costs
This section simplifies the determination of housing costs
by allowing households to claim as shelter expenses any
housing-related money they pay to their landlord on a regular
basis. It also requires that, instead of an excess shelter
expense deduction, a State may elect to give homeless
households with some shelter expenses a flat $143 a month
deduction without extensive documentation.
Section 415. Simplified utility allowance
This section simplifies a provision of current law that
allows a State to determine utility expenses using a Standard
Utility Allowance (SUA) instead of actual utility bills. The
first simplification eliminates the current rules requiring
that the SUA must be prorated, or disallowed, if an eligible
household lives with another individual or family. The second
eliminates the rule that specifies that the SUA may not be used
by certain households in public housing whose utility costs are
partially covered by the housing authority.
Section 416. Simplified procedure for determination of earned income
This section creates a new State option to multiply weekly
paychecks by four and biweekly paychecks by two to determine
monthly income for purposes of determining eligibility and
benefits. In States taking the option the earned income
deduction for all households (equal to 20 percent of all earned
income) would be lowered to ensure cost neutrality.
Section 417. Simplified determination of deductions
This section allows States the option to disregard
household changes in deductible expenses between scheduled
reviews of eligibility. Two changes that may not be disregarded
are reported changes of residence and changes in earned income.
Section 418. Simplified definition of resources
This section creates a State option to exclude from
eligibility determination certain types of resources if the
State also excludes them in its Temporary Assistance for Needy
Families (TANF) cash assistance or Medicaid programs. The
section also prohibits States from excluding cash, money in
accounts that are readily available to the household, or any
other assets the Secretary believes are essential to a fair
determination of food stamp eligibility.
Section 419. Alternative issuance systems in disasters
This section provides the Secretary discretion to select
the most practicable method of issuing emergency food stamps to
disaster victims, including cash.
Section 420. State option to reduce reporting requirements
This section allows States the option to adopt semi-annual
reporting systems for the entire caseload, except for those
households or groups that are exempt even from periodic
reporting to prevent undue hardship, such as the homeless;
migrant workers; and households where everyone is elderly and/
or disabled and has no earnings. Under semi-annual reporting,
food stamp benefits may be frozen for six months at a time,
with households required to report only if their income exceeds
the program's gross income limit.
Section 421. Benefits for adults without dependents
This section changes the time-limit for participation for
able-bodied adults without dependents. The current law rule
limiting their food stamp participation to three out of 36
months without working or participating in a work program is
changed to six out of 24 months. It also allows supervised job
search activities to qualify as a work activity that meets the
work requirement.
Section 422. Preservation of access to electronic benefits
This section prohibits States from taking recipients' EBT
accounts away from electronic access unless the account has
been inactive for at least 180 days, or approximately six
months. If a State does close the account it is required to
send the household a notice informing it how to reinstate those
benefits and offering assistance to households having a
difficult time accessing benefits.
Section 423. Cost neutrality for electronic benefit transfer systems
This section eliminates the current requirement that
electronic benefit transfer (EBT) systems not cost the Federal
Government more than paper issuance systems.
Section 424. Alternative procedures for residents of certain group
facilities
This section allows States the option to provide a
standardized monthly benefit to residents of group homes and
substance abuse centers, rather than going through an
individualized benefit calculation for each resident.
Facilities that receive an allotment for a resident are to
notify the State agency promptly if the resident leaves the
facility. Facilities are also obligated to inform residents
prior to their leaving the facility, that they are eligible to
continue to participate in the Food Stamp Program and should
contact the State immediately for information about continuing
eligibility. An individual who leaves a facility would receive
the standard monthly benefit for the month of and the month
following his or her departure, unless the resident reapplies
sooner to participate in the Food Stamp Program.
Section 425. Availability of food stamp program applications on the
Internet
This section requires States that have a website for the
State agency that administers food stamps to make Food Stamp
Program applications available on-line in each language in
which the State makes a printed application available.
Section 426. Simplified determinations of continuing eligibility
This section replaces fixed certification periods in which
a recipient is required to reapply for the Food Stamp Program
after a specific interval with a more flexible re-determination
process. Households would continue to be considered eligible
until the State makes a determination that the household has
become ineligible, needs to be reviewed, or has failed to
cooperate in a review of its eligibility. This change is
consistent with procedures used in other programs that assist
low-income individuals. The section makes clear that the
interval between re-determinations of eligibility shall not
exceed 12 months (or 24 months for elderly or disabled
recipients).
Section 427. Clearinghouse for successful nutrition education efforts
This section requires the Secretary to request State
agencies to submit to the Secretary descriptions of successful
nutrition education programs designed for use in the food stamp
and other nutrition assistance programs. It directs the
Secretary to make the descriptions available on the USDA
website and to publicize the availability of the website.
Section 428. Transitional food stamps for families moving from welfare
This section allows a household to receive six months of
transitional food stamp benefits following termination of TANF
cash assistance. During the transitional period, the household
would receive the same amount of benefits received the month
prior to the end of TANF cash assistance, adjusted for loss of
TANF cash assistance and any other changes that the household
elects to report to the State agency that might increase the
size of the benefits. The section allows re-certification to be
postponed until the month preceding the end of the transitional
period. Households that are sanctioned for a failure to perform
an action required by law related to TANF cash assistance would
be ineligible for this transitional benefit.
Section 429. Delivery of notices of adverse action to retailers
This section allows the Secretary to advise retailers of
adverse action by any method the Secretary determines will
provide evidence of delivery.
Section 430. Reform of quality control system
This section eliminates enhanced funding (bonus payments to
States with error rates less than six percent) for performance
after 2001. For performance in 2001, enhanced funding is
retained at half the current level. The section requires the
Secretary to investigate a State's administration of the Food
Stamp Program if the Secretary determines there is a 95 percent
statistical probability that the State is above the threshold
of the national average error rate plus one percentage point.
If the Secretary determines that the State agency has been
seriously negligent (as determined under standards promulgated
by the Secretary), then the Secretary may impose a sanction of
up to five percent of the State's administrative funding. If
the Secretary determines that a 95 percent statistical
probability exists that the payment error rate of a State
agency exceeds the national performance measure for payment
error rates by more than one percentage point and the State
agency was investigated or sanctioned for each of the two
immediately preceding fiscal years, the State agency is
penalized based on the value of over and underpayments relative
to the threshold. This section also makes a technical
adjustment to the formula for computing sanctions, which
prevents individual States' sanctions from becoming more severe
as the national average declines. The section also requires
that the State agency to develop and implement corrective
action plans to reduce payment errors. The Secretary is also
required to adjust States' error rates to eliminate the impact
of high or increasing numbers of low-income working households
or immigrant households. After 2002, the Secretary may also add
to the list of items for which States' error rates are
adjusted.
Section 431. Improvement of calculation of State performance measures
This section extends the deadline for reporting and
resolving States' quality control (QC) error rates to June 30.
Section 432. High performance bonus payments to States
This section provides a total of 30 annual incentive
payments, totaling $30 million a year, to the six states with
the highest and/or most improved performance with respect to
each of fivemeasures. The section requires that one of the
measures assess participation among low-income working families. The
four additional measures would be determined by the U.S. Department of
Agriculture, the National Governor's Association, the American Public
Human Services Association, and the National Conference of State
Legislatures, within 180 days of the bill's enactment and one of the
measures would have to relate to provision of timely and appropriate
services to applications for and recipients of food stamp benefits. The
final measures would have to be decided within six months from the
bill's enactment and the bonuses would be allocated in a way that is
proportional to caseload. State agencies subject to sanctions would not
be eligible to receive bonus payments.
Section 433. Employment and training program
This section reduces the amount of unmatched Federal funds
available for Food Stamp Employment & Training (FSE&T) to
$90,000,000 but sets aside an additional $25,000,000 a year for
states that pledge to offer a work slot to able-bodied adults
without dependents. The section also expands State flexibility
in spending on the FSE&T program by repealing: 1) the 80
percent set-aside to serve able-bodied adults without
dependents, 2) the maintenance-of-effort requirement to access
new unmatched funds, and 3) the limits on the amount states are
reimbursed for each work slot offered. The section also
increases from $25 to $50 the per month cap on the amount
states may reimburse FSE&T participants for transportation and
other work expenses with a Federal match.
Section 434. Reauthorization of food stamp program and food
distribution program on Indian reservations
This section reauthorizes the Food Stamp Program and the
Food Distribution Program on Indian Reservations Program.
Section 435. Coordination of program information efforts
This section allows states to use TANF or TANF maintenance
of effort funds to pay for costs related to providing
information about the food stamp program, as is currently
allowed for information about other low-income assistance
programs. This provision would not allow TANF or TANF
maintenance-of-effort funds to be used as a match to obtain
food stamp administrative funding.
Section 436. Expanded grant authority
This section clarifies the Secretary's ability to grant
waivers to non-governmental entities to conduct research
related to the Food Stamp Program.
Section 437. Access and outreach pilot programs
This section provides $3,000,000 by the Secretary to fund,
on a 75 percent matching basis, competitive grants to states
and non-government organizations to improve access and outreach
to people who are eligible for the Food Stamp Program.
Section 438. Consolidated block grants and administrative funds
This section consolidates the funding structure for
nutrition assistance in American Samoa and Puerto Rico. Funding
levels are essentially unchanged, but both programs would be
adjusted for food price inflation in future years. The
provision also allows Puerto Rico to spend up to $6 million of
its 2002 grant to help upgrade and modernize its electronic
data processing system and its electronic benefit transfer
system.
Section 439. Assistance for community food projects
This section continues funding for Community Food Projects
at $2.5 million each year. It also increases from 50 to 75
percent the Federal share of the costs of establishing or
carrying out a community food project.
Section 440. Availability of commodities for The Emergency Food
Assistance Program
This section reauthorizes the Emergency Food Assistance
Program (TEFAP) and increases the mandatory funding available
for TEFAP under the Food Stamp Act from $100 million to $110
million each year. The additional $10 million each year would
be used to pay for State costs related to processing, storing,
transporting, and distributing commodities.
Section 441. Innovative programs for addressing common community
problems
This section establishes a Federal-local community
partnership under which information about innovative ideas that
have worked well in communities (to reduce the loss of farms,
reduce hunger, help families leave food stamps, or to otherwise
help communities help themselves) are provided to other
communities where such local programs could be replicated. It
provides $200,000 a year, for each of two years, to a non-
profit organization selected by the Secretary that is
experienced in gathering and providing such information and
guidance to other communities. Such a non-profit would also
contribute some of its own resources.
Section 442. Report on use of electronic benefit transfer systems
This section directs the Secretary to submit a report to
Congress, within one year after enactment, on difficulties in
using electronic benefit transfer (EBT) systems for food stamp
issuance, including the extent and types of fraud, and efforts
underway on the part of USDA, States, retailers, and EBT
contractors to address the problems.
Section 443. Vitamin and mineral supplements
This section allows the use of food stamp benefits to
purchase vitamin-mineral supplements and provides $3,000,000 to
conduct an impact study to evaluate related nutritional,
health, economic, and other consequences of the program's
modification. At a minimum, the study is to examine: (a) the
extent to which problems arise in the purchase of vitamin-
mineral supplements with electronic benefit transfer cards; (b)
the distinguishing at point-of-sale of vitamin-mineral
supplements from herbal and botanical supplements for which
food stamp benefits may not be used; (c) whether participants
in the food stamp program spend more on vitamin-mineral
supplements than nonparticipants; (d) to what extent vitamin-
mineral supplements may be substituted for other foods
purchased with food stamp benefits; (e) the proportion of the
average food stamp allotment that is used to purchase vitamin-
mineral supplements; and (f) the quality of the diets of
participants in the food stamp program has changed as a result
of allowing participants to use food stamp benefits to purchase
vitamin-mineral supplements.
Subtitle B--Miscellaneous Provisions
Section 451. Reauthorization of commodity programs
Subsection (a) reauthorizes the Secretary's ongoing
authorities to provide commodities for nutrition assistance.
Subsection (b) reauthorizes the Commodity Supplemental Food
Program and redistributes administrative and program funds
within the Commodity Supplemental Food Program to provide an
inflation-indexed grant per assigned caseload slot for
administrative costs incurred by State and local agencies
administering the program.
Subsection (c) extends authorization for administrative
funding for The Emergency Food Assistance Program.
Section 452. Restoration of benefits to legal immigrants
Subsection (a) restores eligibility to all legal immigrant
children, regardless of date of entry to the United States.
This subsection also exempts children from sponsor-deeming
rules.
Subsection (b) allows legal immigrants who are able to
demonstrate 16 quarters of work history to qualify for benefits
(instead of the current 40 quarters).
Subsection (c) restores full eligibility to refugees and
asylum seekers for whom there is currently a seven-year limit
on eligibility.
Subsection (d) restores eligibility to disabled legal
immigrants who entered the United States after August 22, 1996
and are eligible for a disability benefit such as Supplemental
Security Income (SSI).
Section 453. Commodities for school lunch programs
This section extends provisions suspending a requirement
that any bonus commodities acquired for agricultural program
purposes and donated to schools be counted toward the
requirement that, at minimum, 12 percent of all school lunch
assistance be in the form of commodities.
Section 454. Exclusion of certain military basic allowances for housing
for determination of eligibility for free and reduced price
meals
This section excludes from income calculations in
determining eligibility for free and reduced-price meals,
military basic allowances for housing (BAH) that are paid for
private military housing, for 2002 and 2003.
Section 455. Eligibility for assistance under the Special Supplemental
Nutrition Program for Women, Infants, and Children (WIC)
This section excludes from income calculations in
determining eligibility for the WIC Program, military basic
allowances for housing (BAH) that are paid for private military
housing.
Section 456. Senior Farmers' Market Nutrition Program
This section directs the Secretary to use $15 million from
the Commodity Credit Corporation (CCC) for each of five years
to carry out and expand the Seniors Farmers' Market Program and
grants the Secretary authority to issue regulations.
Section 457. Fruit and vegetable pilot program
Subsection (a) directs the Secretary to carry out a pilot
program during the 2002 school year through which fresh fruits
and vegetables will be distributed, free-of-charge, to
schoolchildren in each of four states (25 primary and secondary
schools in each state) and on one American-Indian reservation.
Subsection (b) directs schools that participate in the
program to publicize widely the availability of the free fruits
and vegetables.
Subsection (c) directs the Secretary to conduct an
evaluation of the results of the pilot program to determine:
whether students took advantage of the pilot program; whether
interest in the pilot program increased or lessened over time;
and what effect, if any, the pilot program had on vending
machine sales.
Section 458. Congressional Hunger Fellowship
This section establishes the Congressional Hunger Fellows
Program to develop and train future leaders of the United
States to pursue careers in humanitarian service.
Section 459. Nutrition information and awareness pilot program
Subsections (a) and (b) authorize the Secretary to
establish a pilot program, in no more than 15 states, to
increase the domestic consumption of fresh fruits and
vegetables and convey related health promotion messages. The
bill provides funds to States to assist eligible public and
private sector entities with cost-share assistance to carry out
the demonstration projects.
Subsection (c) indicates the Secretary is to give
preference for participation to States in which the production
of fruits and vegetables is a significant industry, as
determined by the Secretary. It also directs the Secretary to
base the program on strategic initiatives including: health
promotion and education interventions; public service and paid
advertising or marketing activities; health promotion campaigns
relating to locally grown fruits and vegetables; and social-
marketing campaigns.
Subsection (d) requires that, in selecting States to
participate in the program, the Secretary shall take into
consideration (1) experience in carrying out similar projects
or activities; (2) innovation; and (3) the ability of the State
to conduct marketing campaigns to promote and track increases
in levels of produce consumption and to optimize the
availability of produce.
Subsection (e) establishes the Federal share of the cost of
any project carried out using funds provided under this section
shall be 50 percent.
Subsection (f) directs that projects shall not be made
available to any foreign for-profit corporation.
Subsection (g) authorizes appropriations of $25,000,000 for
each of fiscal years 2002 through 2006.
Section 460. Effective date
This section provides that, unless otherwise noted within a
particular section, all sections of this title take effect on
September 1, 2002. At the option of a State agency, however,
implementation of any or all provisions may be delayed until
October 1, 2002.
TITLE V--CREDIT
Subtitle A--Amending Provisions Relating to Farm Ownership Loans in the
Consolidated Farm and Rural Development Act Relating
Section 501. Direct loans
This section provides that direct farm ownership loans are
available to a farmer or rancher who has participated in the
business operations of a farm or ranch for not less than three
years. Current law provides that direct farm ownership loans
are available to a farmer or rancher who has operated, as
opposed to merely participated in, a farm or ranch for not less
than three years. This provision was originally intended to
ensure that farmers and ranchers have some farming experience
before taking on direct farm ownership loan debt. With this
change, the Committee recognizes that some applicants for
direct farm ownership loans may have actively participated and
gained experience in operating a farm or ranch but may not have
been solely responsible for its operations.
Section 502. Financing of bridge loans
This section provides the Secretary the authority to
refinance ``bridge loans'' made by a commercial lender to a
beginning farmer or rancher who has been approved for a USDA
farm ownership loan but is awaiting funding for the program.
Section 503. Limitations on amount of farm ownership loans
This section increases the limit on direct farm ownership
debt for a beginning farmer or rancher to $250,000 and indexes
the amount to inflation.
Section 504. Joint financing arrangements
This section provides the Secretary the authority, as part
of a joint financing arrangement for beginning farmers and
ranchers, to make the USDA's portion of the financing at an
interest rate that is 50 basis points less than the rate
provided to non-beginning farmers and ranchers.
Section 505. Guarantee percentage for beginning farmers and ranchers
This section provides beginning farmers and ranchers, who
participate in USDA's down payment loan program for acquiring
farmland, with a 95 percent guarantee on ownership and
operating loans. Current law allows, but does not require, the
Secretary to provide a 95 percent guarantee on a farm ownership
loan for acquiring a farm or ranch to a borrower who is
participating in the down payment loan program. The section
also allows a 95 percent guarantee on an operating loan during
the period that a borrower who participates in this program has
an outstanding direct ownership loan. By specifying the
guarantee at 95 percent, the Committee intends to help
beginning farmers and ranchers obtain commercial credit.
Section 506. Guarantee of loans made under State beginning farmer or
rancher programs
This section authorizes the Secretary to guarantee loans
made by State beginning farmer and rancher programs, which
includes loans that use funds resulting from the issuance of
tax-exempt Aggie bonds.
Section 507. Down payment loan programs
This section provides that as part of the down payment
program for beginning farmers and ranchers, USDA shall finance
40 percent of the loan (current law is 30 percent) and provide
a repayment term of 20 years (current law is 10 years).
Section 508. Beginning farmer and rancher contract land sales program
This section directs the Secretary to create a pilot
program in which the Secretary will guarantee loans made by a
private seller of a farm or ranch to a qualified beginning
farmer on a contract land sale basis.
Subtitle B--Amending Provisions Relating to Operating Loans in the
Consolidated Farm and Rural Development Act
Section 511. Direct loans
This section provides that direct operating loans are
available to a qualified beginning farmer or rancher who has
operated a farm or ranch for not more than 10 years.
Section 512. Amount of guarantee of loans for tribal farm operations;
waiver of limitations for tribal farm operations and other farm
operations
This section requires a 95 percent guarantee of an
operating loan made to a Native American farming on an Indian
Reservation and allows the Secretary to waive term limits for
Native American farm operations on tribal lands if she
determines that commercial credit is not generally available
for such operations. The section also provides the Secretary
authority to waive the term limitation on direct operating
loans to allow farmers to obtain loans for two years beyond the
current seven-year limit.
Subtitle C--Amending Administrative Provisions in the Consolidated Farm
and Rural Development Act
Section 521. Eligibility of limited liability companies for farm
ownership loans, farm operating loans, and emergency loans
This section adds limited liability companies to the list
of eligible entities able to receive farm ownership loans, farm
operating loans, and natural disaster emergency loans.
Section 522. Debt Settlement
This section streamlines the debt settlement process by
removing the county committees fromhaving to review and make
recommendations regarding the debt settlement agreement reached by the
borrowers and FSA.
Section 523. Temporary authority to enter into contracts; private
collection agencies
This section removes two USDA authorities to enter into
contracts with private entities for the purpose of servicing
loans and collecting delinquent debt.
Section 524. Interest rate options for loans in servicing
This section expands USDA's authority to allow the interest
rate on a direct loan that is being rewritten to be the rate in
effect on the date that a borrower applies for servicing.
Current law provides that the interest rate on a loan being
rewritten is to be either the original interest rate or the
rate in effect at the time the loan is rewritten. The proposal
provides a third option of the rate in effect on the date that
the borrower applies for servicing.
Section 525. Annual review of borrowers
This section removes the requirement that county committees
certify that FSA conducts annual reviews of the credit history
of the borrowers.
Section 526. Simplified loan applications
This section raises the low documentation loan amount for a
farmer program guaranteed loan from $50,000 to $100,000.
Section 527. Inventory property
This section increases the time period in which a beginning
farmer or rancher receives a preference to purchase inventory
farmland from the Secretary from 75 days to 135 days and
provides that the Secretary can combine or divide parcels of
inventory property to maximize opportunities for beginning
farmers and ranchers to acquire such properties. The section
also requires the Secretary to consider selling or granting
easements on inventory land for the purpose of farmland
preservation.
Section 528. Definitions
This section increases to 30 (from 25 percent) percent the
amount of land that an applicant may own as a condition of
meeting the definition of a qualified beginning farmer or
rancher and excludes from the definition of ``debt
forgiveness'' any write-down provided as part of a resolution
of a discrimination complaint against the Secretary.
Section 529. Loan authorization levels
This section increases the loan authorization levels for
the direct and guaranteed loan programs by authorizing $3.75
billion for each fiscal year. Direct loans are authorized $750
million annually--$200 million for farm ownership (FO) loans
and $550 million for farm operating loans. Guaranteed loans are
authorized $3 billion--$1 billion for FO loans and $2 billion
for farm operating loans.
Section 530. Interest rate reduction program
This section makes permanent the interest rate reduction
program and provides that beginning farmers and ranchers
receive an additional one percent interest rate subsidy (capped
at four percent) over non-beginning farmers (capped at 3
percent) who participate in the program. The section also
increases the maximum amount of funds for this program to $750
million and provides that 25 percent of the program's
subsidized funds are reserved for assisting beginning farmers
and ranchers until April 1 of each fiscal year.
Section 531. Options for satisfaction of obligation to pay recapture
amount for shared appreciation agreements
This section provides those who owe recapture amounts on
shared appreciation agreements or those who have amortized the
recapture amounts, the option of providing farmland protection
easements on their land in return for forgiveness of the
recapture amount.
Section 532. Waiver of borrower training certification requirement
This section allows the Secretary to waive the borrower
training certification requirement if the Secretary determines
that the borrower demonstrates adequate knowledge in this area
and requires the Secretary to issue criteria for waivers.
Section 533. Annual review of borrowers
This section requires FSA to conduct an annual review of
borrowers rather than a biannual review.
Subtitle D--Amending the Farm Credit Act
Section 541. Repeal of approval requirements
This section allows a Title I or II Farm Credit lender to
participate in a ``similar entity'' loan originated by a
commercial lender without the need to seek prior approval from
the Title III lender that functions where the loan is being
made. Current law requires System institutions to obtain
permission from one another when participating in these multi-
lender transactions. This section eliminates these requirements
only as they pertain to multi-lender loans that the System does
not originate.
Section 542. Banks for cooperatives
This section contains a provision to strengthen the
System's international financing authorities. The bank vested
with these authorities, CoBank, will be authorized to finance
the export of agriculturally-related equipment and goods
irrespective of whether these goods will be used on the farm in
the importing country. Current provisions impose an ``on-farm''
use requirement. That requirement hinders export sales. In
addition, this requirement curtails the bank's ability to
participate in USDA's facilities credit guarantee program.
Section 543. Insurance Corporation premiums
This section provides the Farm Credit System Insurance
Corporation the ability to recognize the lower risk associated
with the certain guaranteed loans and to adjust premiums
charged accordingly. While government sponsored entity (GSE)
guarantees, such as those issued by Fannie Mae, Freddy Mac, and
Farmer Mac, do not equate to a federal guarantee, they do
provide a measure of protection against loss. The change allows
FCSIC to have the flexibility to weigh the diminished risk in
these loans when setting its insurance premium.
Section 544. Board of Directors of the Federal Agricultural Mortgage
Corporation
This section increases the number of Farmer MAC Board of
Directors from 15 to 17, provides that the chairperson of the
board will be elected by the board, and makes other changes to
the board structure.
Subtitle E--General Provisions
Section 551. Inapplicability of finality rule
This section provides that a farm credit decision by a FSA
county committee is not subject to the 90-day finality rule in
the 1994 USDA Reorganization Act. Current law generally
provides that decisions by FSA county committees become final
within 90 days after the date that a person applies for
benefits. This finality originally applied only to commodity
programs, but inadvertently became applicable to credit
programs as a result of the merger of the old Agriculture
Stabilization and Conservation Service (ASCS) and Farmers' Home
Administration (FmHA) county committees in the 1994
Reorganization Act. This change provides that this rule does
not apply to credit decisions.
Section 552. Technical amendments
This section makes technical amendments to the Consolidated
Farm and Rural Development Act.
Section 553. Effect of amendments
This section addresses the effect of these amendments on
previous law.
Section 554. Effective date
This section provides the effective date of amendments.
TITLE VI--RURAL DEVELOPMENT
Subtitle A--Empowerment of Rural America
Section 601. National Rural Cooperative and Business Equity Fund
This section amends the Consolidated Farm and Rural
Development Act by adding the new subtitle as follows:
Section 383A. Short title
This subtitle may be cited as the ``National Rural
Cooperative and Business Equity Fund Act.''
Section 383B. Purpose
This section states that the purpose of this subtitle is to
revitalize rural communities and enhance farm income through
sustainable rural business development by providing federal
funds and credit enhancements to a private equity fund to
encourage investments by institutional and noninstitutional
investors for the benefit of rural America.
Section 383C. Definitions
This section defines terms used in this subtitle.
Section 383D. Establishment
Subsection (a). Authority:
Paragraph (1). This paragraph provides that on
certification by the Secretary that, to the maximum extent
practicable, the parties proposing to establish the Fund are
broadly representative of groups of similar authorized private
investors (as defined in Section 383C), the parties may
establish a non-Federal entity under State law to purchase
shares of, and manage, the National Rural Cooperative and
Business Equity Fund (the ``Fund'') to generate and provide
equity capital to rural businesses.
Paragraph (2). This paragraph provides that to the maximum
extent practicable, equity ownership of the Fund will be
distributed among authorized private investors. It prohibits
the exclusion of any group of authorized private investors from
equity ownership of the Fund if an authorized private investor
representative of the group is able and willing to invest in
the Fund.
Subsection (b). This subsection states that the purposes of
the Fund are to strengthen the economy of rural areas; to
further sustainable rural business development; to encourage
start-up rural businesses, increased opportunities for small
and minority-owned rural businesses; and the formation of new
rural businesses; to enhance rural employment opportunities; to
provide equity capital to rural businesses, many of which have
difficulty obtaining equity capital; and to leverage non-
Federal funds for rural businesses.
Subsection (c). This subsection provides that the articles
of incorporation and by-laws of the Fund will set forth
purposes of the Fund that are consistent with the purposes
described in subsection (b).
Section 383E. Investment in the Fund
Subsection (a): This subsection provides that of the funds
made available under section 383H, the Secretary will make
available to the Fund $150,000,000; guarantee 50 percent of
each investment made by an authorized private investor in the
Fund; and guarantee the repayment of principal of, and accrued
interest on, debentures issued by the Fund to authorized
private investors.
Subsection (b). Private Investment:
Paragraph (1). This paragraph provides that the Secretary
will make an amount available to the Fund only after an equal
amount has been invested in the Fund by authorized private
investors.
Paragraph (2). This paragraph provides that an insured
depository institution may be an authorized private investor in
the Fund; and that an investment in the Fund may be considered
to be part of the record of an institution in meeting the
credit needs of community in which the institution is located
under any applicable Federal law. The total investment in the
Fund of an insured depository institution is not to exceed five
percent of the capital and surplus of the institution. An
appropriate Federal banking agency may, by regulation or order,
impose on any insured depository institution investing in the
Fund, any safeguard, limitation, or condition appropriate to
ensure that the institution operates in a financially sound
manner, and complies with all applicable law.
Subsection (c). Guarantee of Private Investments:
Paragraph (1). This paragraph provides that the Secretary
will guarantee, under terms and conditions determined by the
Secretary, 50 percent of any loss of the principal of an
investment made in the Fund by an authorized private investor.
Paragraph (2). This paragraph provides that the aggregate
potential liability of the Secretary with respect to all
guarantees under paragraph (1) will not apply to more than
$300,000,000 in private investments in the Fund.
Paragraph (3). This paragraph provides that an authorized
private investor in the Fund may redeem a guarantee with
respect to the total investments in the Fund and the total
losses of the authorized private investor as of the date of
redemption either on the date that is five years after the date
of the initial investment by the authorized private investor,
or annually thereafter. On redemption of a guarantee, the
shares in the Fund of the authorized private investor will be
redeemed and the authorized private investor will be prohibited
from making any future investment in the Fund.
Subsection (d). Debt Securities:
Paragraph (1). This paragraph provides that the Fund may,
at the discretion of the Board, generate additional capital
through the issuance of debt securities and other means
determined to be appropriate by the Board.
Paragraph (2). This paragraph requires the Secretary to
guarantee 100 percent of the principal of, and accrued interest
on, debentures issued by the Fund that are approved by the
Secretary. The outstanding value of debentures issued by the
Fund and guaranteed by the Secretary shall not exceed the
lesser of the amount equal to twice the value of the assets
held by the Fund or $500,000,000. If the Secretary makes a
payment on a debt security issued by the Fund as a result of a
guarantee of the Secretary under this paragraph, the Secretary
will have priority over other creditors for repayment of the
debt security.
Paragraph (3). This paragraph provides that an authorized
private investor may purchase debt securities issued by the
Fund.
Section 383F. Investments and other activities of the Fund
Subsection (a). Investments:
Paragraph (1). This paragraph provides that the Fund may
make equity investments in a rural business that meets the
requirements of paragraph (6) and such other requirements as
the Board may establish, and extend credit to the rural
business in the form of mezzanine debt or subordinated debt or
any other form of quasi-equity. A single investment by the Fund
shall not exceed the greater of an amount equal to seven
percent of the capital of the Fund or $2,000,000. Except in the
case of a project to assist a rural cooperative, the total
amount of nonequity investments described in subparagraph
(A)(ii) that may be provided by the Fund shall not exceed 20
percent of the total investments of the Fund in the project.
The amount of any investment by the Fund in a rural business is
not to exceed the aggregate amount invested by other private
entities in that rural business.
Paragraph (2). This paragraph provides that the Fund must
implement procedures to ensure that the financing arrangements
of the Fund meet the Fund's primary focus of providing equity
capital and the Fund does not compete with conventional sources
of credit.
Paragraph (3). This paragraph provides that the Fund must
seek to make equity investments in a variety of viable
projects, with a significant share of investments in smaller
enterprises in rural communities of diverse sizes and in
cooperative and noncooperative enterprises, and provides that
the Fund must be managed in such a way as to diversify the
risks to the Fund among a variety of projects.
Paragraph (4). This paragraph provides that the Fund shall
not invest in any rural business that is primarily retail in
nature, other than a purchasing cooperative.
Paragraph (5). This paragraph provides that returns on
investments in and by the Fund and returns on the extension of
credit by participants in projects assisted by the Fund are not
subject to any State or Federal law establishing a maximum
allowable interest rate.
Paragraph (6). This paragraph provides that any recipient
of amounts from the Fund must make or obtain a significant
investment from a source of capital other than the Fund. Rural
business investment projects to be considered for an equity
investment from the Fund must be sponsored by a regional,
State, or local sponsoring or endorsing organization such as a
financial institution, a development organization, or any other
established entity engaging or assisting in rural business
development, including a rural cooperative.
Subsection (b). This subsection requires the Fund to use
not less than two percent of capital provided by the Federal
Government to provide technical assistance to rural businesses
seeking an equity investment from the Fund.
Subsection (c). This subsection requires the Board to
authorize an annual audit of the financial statements of the
Fund by a nationally recognized auditing firm using generally
accepted accounting principles, and to make the results of the
audit available to investors in the Fund.
Subsection (d). This subsection requires the Board to
prepare and make available to the public an annual report that
describes the projects funded with amounts from the Fund,
specifies the recipients of amounts from the Fund, specifies
the coinvestors in all projects that receive amounts from the
Fund, and meets the reporting requirements, if any, of the
State under the law of which the Fund is established.
Subsection (e). This subsection allows the Board to
exercise such other authorities as are necessary to carry out
this subtitle, and requires the Secretary to enter in to a
contract with the Administrator of the Small Business
Administration under which the Administrator of the Small
Business Administration shall be responsible for the routine
duties of the Secretary in regard to the Fund.
Section 383G. Governance of the Fund
Subsection (a). This subsection provides that the Fund will
be governed by a board of directors that represents all of the
authorized private investors in the Fund and the Federal
Government and consists of a designee of the Secretary, two
members who are appointed by the Secretary and are not Federal
employees, eight members who are elected by the authorized
private investors, and one member who is appointed by the Board
and who is a community banker from an insured depository
institution that has total assets of not more than $250,000,000
and has made an investment in the Fund.
Subsection (b). This subsection provides that no individual
investor or group of authorized investors may control more than
25 percent of the votes on the Board.
Section 383H. Authorization of Appropriations
This section authorizes appropriation of such sums as are
necessary to carry out the subtitle.
Section 602. Rural Business Investment Program
This section amends the Consolidated Farm and Rural
Development Act as follows:
Section 384A. Definitions
This section defines terms used in this subtitle.
Section 384B. Purposes
This section states that the purposes of the subtitle are
(1) to promote economic development and the creation of wealth
and job opportunities in rural areas and among individuals
living in those areas by encouraging developmental venture
capital investments in smaller enterprises primarily located in
rural areas, and (2) to establish a developmental venture
capital program with the mission of addressing the unmet equity
investment needs of small enterprises located in rural areas,
by authorizing the Secretary to enter into participation
agreements with Rural Business Investment Companies
(``RBICs''), to guarantee debentures of RBICs to enable each
RBIC to make developmental venture capital investments in
smaller enterprises in rural areas, and to make grants to
RBICs, and to other entities, for the purpose of providing
operational assistance to smaller enterprises financed, or
expected to be financed, by the RBICs.
Section 384C. Establishment
This section provides that the Secretary will establish a
Rural Business Investment Program, under which the Secretary
may enter into participation agreements with RBICs granted
final approval, guarantee the debentures issued by RBICs, and
make grants to RBICs and to other entities.
Section 384D. Selection of Rural Business Investment Companies
Subsection (a). This subsection provides that a company
will be eligible to apply to participate as a RBIC in the
program established under this subtitle if (1) the company is a
newly formed for-profit entity, (2) the company has a
management team with experience in community development
financing or relevant venture capital financing, and (3) the
company will invest in enterprises that will create wealth and
job opportunities in rural areas, with an emphasis on smaller
businesses.
Subsection (b). This subsection provides that to
participate as a RBIC in the program established under this
subtitle, a company meeting the eligibility requirements of
subsection (a) must submit an application to the Secretary that
includes (1) a business plan describing how the company intends
to make successful developmental venture capital investments in
identified rural areas, (2) information regarding the community
development finance or relevant venture capital qualifications
and general reputation of the management of the company, (3) a
description of how the company intends to work with community
organizations and to seek to address the unmet capital needs of
the communities served, (4) a proposal describing how the
company intends to use the grant funds provided under this
subtitle to provide operational assistance to smaller
enterprises financed by the company, including information
regarding whether the company intends to use licensed
professionals, when necessary, on the staff of the company or
from an outside entity, (5) with respect to binding commitments
to be made to the company under this subtitle, an estimate of
the ratio of cash to in-kind contributions, (6) a description
of the criteria to be used to evaluate whether and to what
extent the company meets the objectives of the program
established under this subtitle, (7) information regarding the
management and financial strength of any parent firm,
affiliated firm, or any other firm essential to the success of
the business plan of the company, and (8) such other
information as the Secretary may require.
Subsection (c). Issuance of License:
Paragraph (1). This paragraph requires each applicant for a
license to operate as a RBIC to submit an application to the
Secretary.
Paragraph (2). This paragraph provides that no later than
90 days after the initial receipt by the Secretary of an
application, the Secretary must provide the applicant with a
written report describing the status of the application and any
requirements remaining for completion of the application.
Within a reasonable time after receiving a completed
application, the Secretary must either approve the application
and issue a license for the operation, or disapprove the
application and notify the applicant in writing of the
disapproval.
Paragraph (3). This paragraph requires that in reviewing
and processing an application, the Secretary must determine
whether the applicant meets the requirements of subsections (d)
and (e) and whether the management of the applicant is
qualified and has the knowledge, experience, and capability
necessary to comply with this subtitle. The Secretary must
consider the need for and availability of financing for rural
business concerns in the geographic area in which the applicant
is to commence business, the general business reputation of the
owners and management of the applicant, and the probability of
successful operations of the applicant, including adequate
profitability and financial soundness. The Secretary may not
consider any projected shortage or unavailability of leverage.
Subsection (d). This subsection allows the Secretary to
approve an applicant to operate as a RBIC and to designate the
applicant as a RBIC if the Secretary determines that the
application satisfies the requirements of subsection (b), if
the area in which the company is to conduct its operations and
the establishment of branch offices or agencies (if authorized
by the articles) are approved by the Secretary, and if the
applicant enters into a participation agreement with the
Secretary.
Section 384E. Debentures
Subsection (a). This subsection allows the Secretary to
guarantee the timely payment of principal and interest, as
scheduled, on debentures issued by any RBIC.
Subsection (b). This subsection allows the Secretary to
make guarantees under this section on such terms and conditions
as the Secretary considers appropriate, except that the term of
any debenture guaranteed under this section must not exceed 15
years.
Subsection (c). This subsection provides that the full
faith and credit of the United States is pledged to the payment
of all guarantees made under this subtitle.
Subsection (d). This subsection provides that the Secretary
may guarantee the debentures issued by a RBIC only to the
extent that the total face amount of outstanding guaranteed
debentures of the company does not exceed 300 percent of the
private capital of the company. The Secretary may provide for
the use of discounted debentures.
Section 384F. Issuance and Guarantee of Trust Certificates
Subsection (a). This subsection allows the Secretary to
issue trust certificates representing ownership of all or a
fractional part of debentures issued by a RBIC and guaranteed
by the Secretary under this subtitle, if the certificates are
based on and backed by a trust or pool approved by the
Secretary and composed solely of guaranteed debentures.
Subsection (b). Guarantee:
Paragraph (1). This paragraph allows the Secretary to
guarantee the timely payment of the principal of and interest
on trust certificates issued by the Secretary or agents of the
Secretary for purposes of this section.
Paragraph (2). This paragraph limits each guarantee under
this subsection to the extent of principal and interest on the
guaranteed debentures that compose the trust or pool.
Paragraph (3). This paragraph provides that in the event a
debenture in a trust or pool is prepaid, or in the event of
default of such a debenture, the guarantee of timely payment of
principal and interest on the trust certificates shall be
reduced in proportion to the amount of principal and interest
the prepaid debenture represents in the trust or pool. Interest
on prepaid or defaulted debentures will accrue and be
guaranteed by the Secretary only through the date of payment of
the guarantee. At any time during its term, a trust certificate
may be called for redemption due to prepayment or default of
all debentures.
Subsection (c). This subsection provides that the full
faith and credit of the United States is pledged to the payment
of any guarantee of a trust certificate issued by the Secretary
or agents of the Secretary under this section.
Subsection (d). This subsection provides that if the
Secretary pays a claim under a guarantee issued under this
section, the claim shall be subrogated fully to the rights
satisfied by the payment. No Federal, State, or local law shall
preclude or limit the exercise by the Secretary of the
ownership rights of the Secretary in a debenture residing in a
trust or pool against which one or more trust certificates are
issued under this section.
Subsection (e). Management and Administration:
Paragraph (1). This paragraph requires the Secretary to
provide for a central registration of all trust certificates
issued under this section.
Paragraph (2). This paragraph allows the Secretary to
maintain such commercial bank accounts or investments in
obligations of the United States as may be necessary to
facilitate the creation of trusts or pools backed by debentures
guaranteed under this subtitle, and to issue trust certificates
to facilitate the creation of those trusts or pools.
Paragraph (3). This paragraph requires any agent performing
functions on behalf of the Secretary under this paragraph to
provide a fidelity bond or insurance in such amount as the
Secretary considers to be necessary to fully protect the
interests of the United States.
Paragraph (4). This paragraph allows the Secretary to
regulate brokers and dealers in trust certificates issued under
this section.
Paragraph (5). This paragraph states that nothing prohibits
the use of a book-entry or other electronic form of
registration for trust certificates issued under this section.
Section 384G. Fees
Subsection (a). This subsection allows the Secretary to
charge such fees as the Secretary considers appropriate with
respect to any guarantee or grant issued under this subtitle.
Subsection (b). This subsection prohibits the Secretary
from collecting a fee for any guarantee of a trust certificate
under section 384F, except that any agent of the Secretary may
collect a fee approved by the Secretary for certain functions
listed in section 384F.
Subsection (c). This subsection allows the Secretary to
prescribe fees to be paid by each applicant for a license to
operate as a RBIC under this subtitle. Fees collected under
this subsection must be deposited in the account for salaries
and expenses of the Secretary, and are authorized to be
appropriated solely to cover the costs of licensing
examinations.
Section 384H. Operational Assistance Grants
Subsection (a). This subsection provides that the Secretary
may make grants to RBICs and to other entities, as authorized
by this subtitle, to provide operational assistance to smaller
enterprises financed, or expected to be financed, by the
entities. Grants made under this subsection will be made over a
multi-year period not to exceed 10 years. The proceeds of a
grant made under this paragraph may be used by the RBIC or
entity receiving the grant only to provide operational
assistance in connection with an equity investment in a
business located in a rural area, or to pay operational
expenses of the company. A RBIC shall be eligible for a grant
under this section only if the company submits a plan for use
of the grant. The amount of a grant made under this subsection
to a RBIC will equal the lesser of 50 percent of the amount of
resources raised by the RBIC, or $1,000,000. The amount of a
grant made under this subsection to any entity other than a
RBIC shall be equal to the resources raised by the entity in
accordance with the requirements applicable to RBICs under this
subtitle.
Subsection (b). This subsection allows the Secretary to
make supplemental grants to RBICs and to other entities to
provide additional operational assistance to smaller
enterprises financed, or expected to be financed, by the RBICs
and other entities. The Secretary may require, as a condition
of any supplemental grant made under this subsection, that the
RBIC or other entity receiving the grant match the supplemental
grant funds with an equal amount from resources other than
resources provided by the Secretary.
Section 384I. Rural Business Investment Companies
Subsection (a). This subsection requires that a RBIC must
(1) be an incorporated body, a limited liability company, or a
limited partnership organized and chartered or otherwise
existing under State law solely for the purpose of performing
the functions and conducting the activities authorized by this
subtitle; (2) if incorporated, have succession for a period of
not less than 30 years unless earlier dissolved by the
shareholders of the company, or if a limited partnership or
limited liabilitycompany, have succession for a period of not
less than 10 years; and (3) possess the powers reasonably necessary to
perform the functions and conduct the activities authorized by this
subtitle.
Subsection (b). This subsection provides that the articles
of any RBIC must specify in general terms the purposes for
which the RBIC is formed, the name of the RBIC, the area or
areas in which the operations of the RBIC are to be carried
out, the place where the principal office of the RBIC is to be
located, and the amount and classes of the shares of capital
stock of the RBIC. The articles may contain any other
provisions consistent with this subtitle that the RBIC may
determine appropriate to adopt for the regulation of its
business and the conduct of its affairs. The articles will be
subject to the approval of the Secretary.
Subsection (c). This subsection provides that the private
capital of each RBIC will be at least $5,000,000, or, with
respect to RBICs authorized to issue participating securities
to be purchased or guaranteed by the Secretary, $10,000,000. If
the Secretary determines that it will not create an
unreasonable risk of default or loss to the Federal Government
to allow a RBIC authorized to issue participating securities to
be purchased or guaranteed by the Secretary to have private
capital of less than $10,000,000, the Secretary may require at
least $5,000,000 in private capital from the RBIC rather than
$10,000,000. The Secretary must also determine whether the
private capital of each RBIC is adequate to ensure a reasonable
prospect that the RBIC will be operated soundly and profitably,
and managed actively and prudently in accordance with the
articles of the RBIC, and whether the RBIC will be able to
comply with the requirements of this subtitle. At least 75
percent of the capital of each RBIC must be invested in rural
business concerns.
Subsection (d). This subsection requires the Secretary to
ensure that the management of each RBIC is sufficiently
diversified from, and unaffiliated with, the ownership of the
RBIC so as to ensure independence and objectivity in the
financial management and oversight of the investments and
operations of the RBIC.
Section 384J. Financial institution investments
Subsection (a). This subsection provides that any national
bank, any member bank of the Federal Reserve System, any
Federal savings association, or any Farm Credit System
institution described in section 1.2(a) of the Farm Credit Act
of 1971 may invest in any RBIC or in any entity established to
invest solely in RBICs. Any insured bank that is not a member
of the Federal Reserve System may also invest in any RBIC or
entity established to invest solely in RBICs to the extent
permitted under applicable State law.
Subsection (b). This subsection provides that no bank,
association, or institution described in subsection (a) may
make investments described in subsection (a) that are greater
than five percent of the capital and surplus of the bank,
association, or institution.
Subsection (c). This subsection provides that if a Farm
Credit System institution described in section 1.2(a) of the
Farm Credit Act of 1971 holds more than 30 percent of the
voting shares of a RBIC, the RBIC cannot provide equity
investments in, or provide other financial assistance to,
entities that are not otherwise eligible to receive financing
from the Farm Credit System under the Farm Credit Act of 1971.
Section 384K. Reporting Requirement
Subsection (a). This subsection requires each RBIC that
participates in the program established under this subtitle to
provide to the Secretary certain information, including
information relating to the measurement criteria that the RBIC
proposed in its application to the program, and, in each case
in which the RBIC makes an investment in, or a loan or grant
to, a business that is not located in a rural area, a report on
the number and percentage of employees of the business who
reside in those areas.
Section 384L. Examinations
Subsection (a). This subsection makes each RBIC that
participates in the program established under this subtitle
subject to examinations made at the direction of the Secretary
in accordance with this section.
Subsection (b). This subsection allows an examination under
this section to be conducted with the assistance of a private
sector entity that has the qualifications and the expertise
necessary to conduct such an examination.
Subsection (c). This subsection allows the Secretary to
assess the cost of an examination against the RBIC examined,
and requires the RBIC to pay those costs.
Subsection (d). This subsection requires funds collected
under this section to be deposited in the account that incurred
the costs for carrying out this section, to be made available
to the Secretary without further appropriation, and to remain
available until expended.
Section 384M. Injunctions and other orders
Subsection (a). This subsection provides that whenever a
RBIC or any other person has engaged or is about to engage in
any act or practice that constitutes or will constitute a
violation of a provision of this subtitle, the Secretary may
apply to the appropriate district court of the United States
for an order enjoining the act or practice, or for an order
enforcing compliance with the provision. The court shall have
jurisdiction over the action and, on a showing by the Secretary
that the RBIC or other person has engaged or is about to engage
in an act or practice described in this subsection, the court
shall grant without bond a permanent or temporary injunction,
restraining order, or other order.
Subsection (b). This subsection provides that in any
proceeding under subsection (a), the court as a court of equity
may, to such extent as the court considers necessary, take
exclusive jurisdiction over the RBIC and its assets, wherever
located. The court will have jurisdiction to appoint a trustee
or receiver to hold or administer the assets.
Subsection (c). This subsection provides that the Secretary
may act as trustee or receiver of a RBIC. On the request of the
Secretary, the court shall appoint the Secretary to act as a
trustee or receiver of a RBIC, unless the court considers the
appointment inequitable or otherwise inappropriate by reason of
any special circumstances involved.
Section 384N. Additional penalties for noncompliance
Subsection (a). This subsection provides that if a RBIC
violates or fails to comply with this subtitle (including any
rule, regulation, order, or participation agreement under this
subtitle), the Secretary may void the participation agreement
between the Secretary and the RBIC and make the RBIC forfeit
all of its rights and privileges under this subtitle.
Subsection (b). This subsection provides that before the
Secretary may cause a RBIC to forfeit rights or privileges
under subsection (a), a court of the United States of competent
jurisdiction must find that the RBIC committed a violation, or
failed to comply, in a cause of action brought for that purpose
in the district, territory, or other place subject to the
jurisdiction of the United States, in which the principal
office of the RBIC is located. Each cause of action brought by
the United States under this subsection shall be brought by the
Secretary or by the Attorney General.
Section 384O. Unlawful acts and omissions; breach of fiduciary duty
Subsection (a). This subsection provides that whenever any
RBIC violates this subtitle (including any rule, regulation,
order, or participation agreement under this subtitle), the
violation shall also be deemed to be a violation and an
unlawful act committed by any person that, directly or
indirectly, authorizes, orders, participates in, causes, brings
about, counsels, aids, or abets in the commission of any acts,
practices, or transactions that constitute or will constitute,
in whole or in part, the violation.
Subsection (b). This subsection provides that it will be
unlawful for any officer, director, employee, agent, or other
participant in the management or conduct of the affairs of a
RBIC to engage in any act or practice, or to omit any act or
practice, in breach of the fiduciary duty of the officer,
director, employee, agent, or participant if, as a result of
the act or practice, the company suffers or is in imminent
danger of suffering financial loss or other damage.
Subsection (c). This subsection makes it unlawful for any
person to take office as an officer, director, or employee of
any RBIC, or to become an agent or participant in the conduct
of the affairs or management of a RBIC, if the person has been
convicted of a felony, or any other criminal offense involving
dishonesty or breach of trust, or has been found civilly liable
in damages, or has been permanently or temporarily enjoined by
an order, judgment, or decree of a court of competent
jurisdiction, by reason of any act or practice involving fraud,
or breach of trust. It will also be unlawful for any person to
continue to serve in any of the capacities described in this
subsection if the person is convicted of a felony, or any other
criminal offense involving dishonesty or breach of trust, or
the person is found civilly liable in damages, or is
permanently or temporarily enjoined by an order, judgment, or
decree of a court of competent jurisdiction, by reason of any
act or practice involving fraud or breach of trust.
Section 384P. Removal or suspension of directors or officers
This section provides that the Secretary may remove or
suspend any director or officer of any RBIC using the
procedures established by the Secretary pursuant to this
subtitle for removal and suspension.
Section 384Q. Contracting of Functions
This section requires the Secretary to enter into an
interagency agreement with the Administrator of the Small
Business Administration to carry out the day-to-day management
and operation of the program authorized by this subtitle.
Section 384R. Regulations
This section allows the Secretary to promulgate regulations
necessary to carry out this subtitle.
Section 384S. Funding
This section provides that the Secretary of the Treasury
shall transfer to the Secretary of Agriculture such sums as may
be necessary for the cost of guaranteeing $350,000,000 of
debentures under this subtitle, and $50,000,000 to make grants
under this subtitle.
Section 603. Full funding of pending rural development loan and grant
applications
Subsection (a). This subsection defines the term
``application'' to include an application for a loan, loan
guarantee, or grant that, as of the date of enactment of this
Act, is in the preapplication phase of consideration under
regulations of the Secretary of Agriculture in effect on the
date of enactment of this Act.
Subsection (b). This subsection establishes in the Treasury
of the United States an account to be known as the ``Rural
America Infrastructure Development Account'' (referred to in
this section as the ``Account'') to fund rural development
loans, loan guarantees, and grants described in subsection (d)
that are pending on the date of enactment of this Act.
Subsection (c). This subsection provides that not later
than 30 days after the date of enactment of this Act, out of
any funds in the Treasury not otherwise appropriated, the
Secretary of the Treasury shall transfer to the Secretary of
Agriculture such sums as are necessary to carry out this
section, to remain available until expended. The Secretary will
be entitled to receive, will accept, and will use to carry out
this section the funds transferred under this subsection,
without further appropriation.
Subsection (d). This subsection requires the Secretary to
use the funds in the Account to provide funds for applications
that are pending on the date of enactment of this Act for (A)
community facility direct loans under section 306(a)(1) of the
Consolidated Farm and Rural Development Act (7 U.S.C.
1926(a)(1)); (B) community facility grants under paragraph
(19), (20), or (21) of section 306(a) of that Act (7 U.S.C.
1926(a)); (C) water or waste disposal grants or direct loans
under paragraph (1) or (2) of section 306(a) of that Act (7
U.S.C. 1926(a)); (D) rural water or wastewater technical
assistance and training grants under section 306(a)(14) of that
Act (7 U.S.C. 1926(a)(14)); (E) emergency community water
assistance grants under section 306A of that Act (7 U.S.C.
1926a); (F) business and industry guaranteed loans authorized
under section 310B(a)(1)(A) of that Act (7 U.S.C.
1932(a)(1)(A)); and (G) solid waste management grants under
section 310B(b) of that Act (7 U.S.C. 1932(b)). Funds in the
Account will be available to the Secretary to provide funds for
pending applications for loans, loan guarantees, and grants
described in this subsection only to the extent that funds for
the loans, loan guarantees, and grants appropriated in the
annual appropriations Act for fiscal year 2002 have been
exhausted. The Secretary may use the Account to provide funds
for a pending application for a loan, loan guarantee, or grant
described in this subsection only if theSecretary processes,
reviews, and approves the application in accordance with regulations in
effect on the date of enactment of this Act.
Section 604. Rural Endowment Program
This section amends the Consolidated Farm and Rural
Development Act as follows:
Section 385A. Purpose
This section states that the purpose of this subtitle is to
provide rural communities with technical and financial
assistance to implement comprehensive community development
strategies to reduce the economic and social distress resulting
from poverty, high unemployment, outmigration, plant closings,
agricultural downturn, declines in the natural resource-based
economy, or environmental degradation.
Section 385B. Definitions
This section defines terms used in this subtitle.
Section 385C. Rural Endowment Program
Subsection (a). Establishment.
Paragraph (1). This paragraph provides that the Secretary
may establish a program, to be known as the Rural Endowment
Program, to provide approved program entities with assistance
in developing and implementing comprehensive community
development strategies for eligible rural areas.
Paragraph (2). This paragraph provides that the purposes of
the Program are (A) to enhance the ability of an eligible rural
area to engage in comprehensive community development; (B) to
leverage private and public resources for the benefit of
community development efforts in eligible rural areas; (C) to
make available staff of Federal agencies to directly assist the
community development efforts of an approved program entity or
eligible rural area; and (D) to strengthen the asset base of an
eligible rural area to further long-term, ongoing community
development.
Subsection (b). Applications.
Paragraph (1). This paragraph provides that to receive an
endowment grant under the Program, the eligible entity must
submit an application at such time, in such form, and
containing such information as the Secretary may require.
Paragraph (2). This paragraph provides that where
appropriate, the Secretary must encourage regional applications
from program entities serving more than one eligible rural
area. To be eligible for an endowment grant for a regional
application a program entity that submits an application must
demonstrate that a comprehensive community development strategy
for the eligible rural area is best accomplished through a
regional approach, and the combined population of the eligible
rural area covered by the comprehensive community development
strategy is 75,000 inhabitants or less. For the purpose of the
limit on the amount of an endowment grant an approved entity
may receive, two or more program entities that submit a
regional application shall be considered to be a single program
entity.
Paragraph (3). This paragraph requires the Secretary to
give preference to a joint application submitted by a private,
nonprofit community development corporation and a unit of local
government.
Subsection (c). This subsection requires the Secretary to
approve a program entity to receive grants under the Program,
if the entity meets criteria established by the Secretary,
including the following: (1) the entity serves a rural area
that suffers from economic or social distress resulting from
poverty, high unemployment, outmigration, plant closings,
agricultural downturn, declines in the natural resource-based
economy, or environmental degradation; (2) the entity
demonstrates the capacity to implement a comprehensive
community development strategy; (3) the goals described in the
application are consistent with this section; and (4) the
entity demonstrates the ability to convene and maintain a
multi-stakeholder, community-based participation process.
Subsection (d). This subsection provides that the Secretary
may award supplemental grants to approved program entities to
assist the entities in the development of a comprehensive
community development strategy under this subtitle. In
determining whether to award a supplemental grant to an
approved program entity, the Secretary must consider the
economic need of the approved program entity. Supplemental
grants under this subsection may not exceed $100,000.
Subsection (e). Endowment Grant Award:
Paragraph (1). This paragraph provides that to be eligible
for an endowment grant under the Program, an approved program
entity must develop and obtain the approval of the Secretary
for a comprehensive community development strategy that (A) is
designed to reduce economic or social distress resulting from
poverty, high unemployment, outmigration, plant closings,
agricultural downturn, declines in the natural resource-based
economy, or environmental degradation; (B) addresses a broad
range of the development needs of a community, including
economic, social, and environmental needs, for a period of not
less than 10 years; (C) is developed with input from a broad
array of local governments and business, civic, and community
organizations; (D) specifies measurable performance-based
outcomes for all activities; and (E) includes a financial plan
for achieving the outcomes and activities of the comprehensive
community development strategy that identifies sources for, or
a plan to meet, the requirement for a non-Federal share under
this section.
Paragraph (2). This paragraph provides that an approved
program entity will receive final approval if the Secretary
determines that (i) the comprehensive community development
strategy of the approved program entity meets the requirements
of this section; (ii) the management and organizational
structure of the approved program entity is sufficient to
oversee fund and development activities; (iii) the approved
program entity has established an endowment fund; and (iv) the
approved program entity will be able to provide the non-Federal
share required under this section. As part of the final
approval, the approved program entity must agree to achieve, to
the maximum extent practicable, performance-based benchmarks,
and to comply with the terms of the comprehensive community
development strategy for a period of not less than 10 years.
Subsection (f). Endowment Grants:
Paragraph (1). This paragraph provides that under the
Program, the Secretary may make endowment grants to approved
program entities with final approval to implement an approved
comprehensive community development strategy.
Paragraph (2). This paragraph provides that an endowment
grant to an approved program entity shall be in an amount of
not more than $6,000,000, as determined by the Secretary based
on (A) the size of the population of the eligible rural area
for which the endowment grant is to be used; (B) the size of
the eligible rural area for which the endowment grant is to be
used; (C) the extent ofthe comprehensive community development
strategy to be implemented using the endowment grant award; and (D) the
extent to which the community suffers from economic or social distress
resulting from poverty, high unemployment, outmigration, plant
closings, agricultural downturn, declines in the natural resource-based
economy, or environmental degradation.
Paragraph (3). This paragraph provides that on notification
from the Secretary that the program entity has been approved
under subsection (c), the approved program entity shall
establish an endowment fund. Federal funds provided in the form
of an endowment grant under the Program will be deposited in
the endowment fund, will be the sole property of the approved
program entity, will be used in a manner consistent with this
subtitle, and will be subject to oversight by the Secretary for
a period of not more than 10 years. Interest earned on Federal
funds in the endowment fund will be retained by the grantee and
treated as Federal funds are treated under this paragraph. The
Secretary will promulgate regulations on matching funds and
returns on program-related investments only to the extent that
such funds or proceeds are used in a manner consistent with
this subtitle.
Paragraph (4). This paragraph provides that each endowment
grant award will be disbursed during a period not to exceed
five years beginning during the fiscal year containing the date
of final approval of the approved program entity. The Secretary
may disburse a grant award in one lump sum or in incremental
disbursements made each fiscal year. If the Secretary elects to
make incremental disbursements, for each fiscal year after the
initial disbursement, the Secretary will make a disbursement
only if the approved program entity has met the performance-
based benchmarks of the approved program entity for the
preceding fiscal year, and has provided the non-Federal share
required for the preceding fiscal year under this paragraph.
The Secretary may make disbursements under this paragraph
notwithstanding any provision of law limiting grant
disbursements to amounts necessary to cover expected expenses
on a term basis. For each disbursement under this paragraph,
the Secretary will require the approved program entity to
provide a non-Federal share in an amount equal to 50 percent of
the amount of funds received by the entity under the
disbursement. In the case of an approved program entity that
serves a small, poor rural area (as determined by the
Secretary), the Secretary may reduce the non-Federal share to
not less than 20 percent and allow the non-Federal share to be
provided in the form of in-kind contributions. For the purpose
of meeting the non-Federal share requirement with respect to
the first disbursement of an endowment grant award to the
approved program entity under the Program, an approved program
entity must have, at a minimum, binding commitments to provide
the non-Federal share required with respect to the first
disbursement of the endowment grant award, and if the Secretary
is making incremental disbursements of a grant, must develop a
viable plan for providing the remaining amount of the required
non-Federal share. Of each disbursement, an approved program
entity will use not more than 10 percent for administrative
costs of carrying out program-related investments, not more
than 20 percent for the purpose of maintaining a loss reserve
account, and the remainder for program-related investments
contained in the comprehensive community development strategy.
If all disbursed funds available under a grant are expended and
the grant recipient has no expected losses to cover for a
fiscal year, the recipient may use funds in the loss reserve
account for program-related investments for which no reserve
for losses is required. Under the Program, the Secretary will
provide and coordinate technical assistance for grant
recipients by designated field staff of federal agencies.
Subsection (h). This subsection provides that the Secretary
may make grants to qualified intermediaries to provide
technical assistance and capacity building to approved program
entities under the Program. A qualified intermediary that
receives a grant under this subsection must provide assistance
to approved program entities in developing, coordinating, and
overseeing investment strategy, provide technical assistance in
all aspects of planning, developing, and managing the Program,
and facilitate Federal and private sector involvement in rural
community development. To be considered a qualified
intermediary under this subsection, an intermediary must be a
private, nonprofit community development organization, have
expertise in Federal or private rural community development
policy or programs, and have experience in providing technical
assistance, planning, and capacity building assistance to rural
communities and nonprofit entities in eligible rural areas. A
qualified intermediary may receive a grant under this
subsection of not more than $100,000. Of the amounts made
available under section 385D, the Secretary may use to carry
out this subsection not more than $2,000,000 for each of not
more than 2 fiscal years.
Section 385D. Funding
This section provides $82 million in mandatory funds to
carry out the Rural Endowment Program during fiscal years 2002
and 2003, with not more than $5 million to be obligated for
planning grants, not less than $75 million for endowment grants
and not less than $2 million for technical assistance. It
authorizes such appropriations as are necessary to carry out
the program for each of fiscal years 2004 through 2006.
Section 605. Enhancement of access to broadband service in rural areas
This section amends the Rural Electrification Act of 1936
(7 U.S.C. 901 et seq.) as follows:
Section 601. Access to broadband telecommunications
services in rural areas.
Subsection (a). This subsection states that the purpose of
this section is to provide grants, loans, and loan guarantees
to provide funds for the costs of the construction,
improvement, and acquisition of facilities and equipment for
broadband service in eligible rural communities.
Subsection (b). This section defines terms used in this
section.
Subsection (c). This subsection provides that the Secretary
will make grants to eligible entities described in subsection
(e)(1) to provide funds for the construction, improvement, or
acquisition of facilities and equipment for the provision of
broadband service in eligible rural communities.
Subsection (d). This subsection provides that the Secretary
will make or guarantee loans to eligible entities described in
subsection (e)(2) to provide funds for the construction,
improvement, or acquisition of facilities and equipment for the
provision of broadband service in eligible rural communities.
Subsection (e). Eligible Entities.
Paragraph (1). This paragraph provides that to be eligible
to obtain a grant under this section, an entity must (A) be a
nonprofit entity; (B) be eligible to obtain a loan or loan
guarantee to furnish, improve, or extend a rural
telecommunications service under this Act; and (C) submit to
the Secretary a proposal for a project that meets the
requirements of subsection (g).
Paragraph (2). This paragraph provides that to be eligible
to obtain a loan or loan guarantee under this section, an
entity must (A) be eligible to obtain a loan or loan guarantee
to furnish, improve, or extend a rural telecommunications
service under this Act; and (B) submit to the Secretary a
proposal for a project that meets the requirements of
subsection (g).
Subsection (f). This subsection provides that the Secretary
shall, from time to time as advances in technology warrant,
review and recommend modifications of rate-of-data transmission
criteria for purposes of the identification of broadband
service technologies under subsection (b).
Subsection (g). This subsection provides that for purposes
of determining whether or not to make a grant, loan, or loan
guarantee for a project under this section, the Secretary will
not take into consideration the type of technology proposed to
be used under the project.
Subsection (h). This subsection provides that a loan or
loan guarantee under subsection (d) will (1) be made available
in accordance with the requirements of the Federal Credit
Reform Act of 1990 (2 U.S.C. 661 et seq.); (2) bear interest at
an annual rate of, as determined by the Secretary, 4 percent
per annum, or the current applicable market rate; and (3) have
a term not to exceed the useful life of the assets constructed,
improved, or acquired with the proceeds of the loan or
extension of credit.
Subsection (i). This subsection provides that
notwithstanding any other provision of this Act, the proceeds
of any loan made by the Secretary under this Act may be used by
the recipient of the loan for the purpose of refinancing an
outstanding obligation of the recipient on another
telecommunications loan made under this Act if the use of the
proceeds for that purpose will further the construction,
improvement, or acquisition of facilities and equipment for the
provision of broadband service in eligible rural communities.
Subsection (j). Funding:
Paragraph (1). This paragraph provides that not later than
30 days after the date of enactment of this Act, and on October
1, 2002, and each October 1 thereafter through October 1, 2005,
out of any funds in the Treasury not otherwise appropriated,
the Secretary of the Treasury will transfer to the Secretary of
Agriculture to carry out this section $100,000,000, to remain
available until expended.
Paragraph (2). This paragraph provides that the Secretary
will be entitled to receive, will accept, and will use to carry
out this section the funds transferred under paragraph (1),
without further appropriation.
Paragraph (3). This paragraph provides that from amounts
made available for each fiscal year under paragraph (1), the
Secretary will establish a national reserve for grants, loans,
and loan guarantees to eligible entities in States under this
section, and will allocate amounts in the reserve to each State
for each fiscal year for grants, loans, and loan guarantees to
eligible entities in the State. The amount of an allocation
made to a State for a fiscal year will bear the same ratio to
the amount of allocations made for all States for the fiscal
year as the number of communities with a population of 2,500
inhabitants or less in the State bears to the number of
communities with a population of 2,500 inhabitants or less in
all States, as determined on the basis of the last available
census. Any amounts in the reserve established for a State for
a fiscal year that are not obligated by April 1 of the fiscal
year will be available to the Secretary to make grants, loans,
and loan guarantees under this section to eligible entities in
any State, as determined by the Secretary.
Subsection (k). This subsection provides that no grant,
loan, or loan guarantee may be made under this section after
September 30, 2006, but that any grant, loan, or loan guarantee
made under this section before that date shall be valid.
Section 606. Value-added agricultural product market development grants
This section amends Section 231 of the Agricultural Risk
Protection Act of 2000 (7 U.S.C. 1621 note; Public Law 106-224)
as follows:
Subsections (b) through (d) are redesignated subsections
(c) through (e) and a new subsection (a) and subsection (b) are
added.
Subsection (a). This subsection adds a new definition of
``value-added agricultural product.'' Currently, there is no
statutory definition of this term. The term ``value-added
agricultural product'' means any agricultural commodity or
product that (1) has undergone a change in physical state, or
was produced in a manner that enhances the value of the
agricultural commodity or product, as demonstrated through a
business plan that shows the enhanced value, as determined by
the Secretary; and (2) as a result of the change in physical
state or the manner in which the agricultural commodity or
product was produced, the customer base for the agricultural
commodity or product has been expanded, and a greater portion
of the revenue derived from the processing of the agricultural
commodity or product is available to the producer of the
commodity or product.
Subsection (b). Grant Program:
Paragraph (1). This paragraph adds a list of purposes to
the section. The purposes of the value-added agricultural
product market development grant program are (A) to increase
the share of the food and agricultural system profit received
by agricultural producers; (B) to increase the number and
quality of rural self-employment opportunities in agriculture
and agriculturally-related businesses and the number and
quality of jobs in agriculturally-related businesses; (C) to
help maintain a diversity of size in farms and ranches by
stabilizing the number of small and mid-sized farms; (D) to
increase the diversity of food and other agricultural products
available to consumers, including nontraditional crops and
products and products grown or raised in a manner that enhances
the value of the products to the public; (E) to conserve and
enhance the quality of land, water, and energy resources,
wildlife habitat, and other landscape values and amenities in
rural areas.
Paragraph (2). This paragraph provides that for each of
fiscal years 2002 through 2006, the Secretary will use
$75,000,000 in funds transferred from the Treasury to the
Secretary to award competitive grants (A) to an eligible
independent producer (as determined by the Secretary) of a
value-added agricultural product to assist the producer in
developing a business plan for viable marketing opportunities
for the value-added agricultural product, or in developing
strategies that are intended to create marketing opportunities
for the producer; and (B) to an eligible nonprofit entity (as
determined by the Secretary) to assist the entity in developing
a business plan for viable marketing opportunities in emerging
markets for a value-added agricultural product, in developing
strategies that are intended to create marketing opportunities
in emerging markets for the value-added agricultural product.
Also, existing law does not allow nonprofit entities to be
eligiblefor value-added agricultural product market development
grants.
Paragraph (3). This paragraph provides that the total
amount provided under this subsection to a grant recipient may
not exceed $500,000. The Secretary must give priority to grant
proposals for less than $200,000 submitted under this
subsection.
Paragraph (4). This paragraph provides that a grantee under
paragraph (2) will use the grant to develop a business plan or
perform a feasibility study to establish a viable marketing
opportunity for a value-added agricultural product, or to
provide capital to establish alliances or business ventures
that allow the producer of the value-added agricultural product
to better compete in domestic or international markets.
Paragraph (5). This paragraph establishes a new reserve for
grants for marketing or processing certified organic
agricultural products. It provides that out of any amount that
is made available to the Secretary for a fiscal year under
paragraph (2), the Secretary will use not less than five
percent of the amount for grants to assist producers of
certified organic agricultural products in post-farm marketing
or processing of the products through business or cooperative
ventures that expand the customer base of the certified organic
agricultural products, and increase the portion of product
revenue available to the producers. For the purposes of this
paragraph, a certified organic agricultural product does not
have to meet the requirements of the definition of `value-added
agricultural product' under subsection (a). If, for any fiscal
year, the Secretary receives an insufficient quantity of
applications for grants described in this paragraph to use the
funds reserved, the Secretary may use the excess reserved funds
to make grants for any other purpose authorized under this
section.
This section also increases funding for the Agricultural
Marketing Resource Center, created to provide technical
assistance to recipients of grants under this program, from
$5,000,000 under existing law to 7.5 percent of the funding
made available under this section.
Section 607. National Rural Development Information Clearinghouse
This section amends Section 2381 of the Food, Agriculture,
Conservation, and Trade Act of 1990 (7 U.S.C. 3125b) as
follows:
Subsection (a). This subsection provides that the Secretary
shall establish and maintain, within the rural development
mission area of the Department of Agriculture, a National Rural
Development Information Clearinghouse (referred to in this
section as the ``Clearinghouse'') to perform the functions
specified in subsection (b).
Subsection (b). This subsection provides that the
Clearinghouse will collect information and data from, and
disseminate information and data to, any person or public or
private entity about programs and services provided by Federal,
State, local, and tribal agencies, institutions of higher
education, and private, for-profit and nonprofit organizations
and institutions under which a person or public or private
entity residing or operating in a rural area may be eligible
for any kind of financial, technical, or other assistance,
including business, venture capital, economic, credit and
community development assistance, health care, job training,
education, and emotional and financial counseling.
Subsection (c). This subsection provides that in addition
to other modes for the collection and dissemination of the
types of information and data specified under subsection (b),
the Secretary will ensure that the Clearinghouse maintains an
Internet website that provides for dissemination and
collection, through voluntary submission or posting, of the
information and data.
Subsection (d). This subsection provides that on request of
the Secretary and to the extent permitted by law, the head of a
Federal agency will provide to the Clearinghouse such
information as the Secretary may request to enable the
Clearinghouse to carry out this section.
Subsection (e). This subsection provides that the Secretary
will request State, local, and tribal governments, institutions
of higher education, and nonprofit and for-profit organizations
and institutions to provide to the Clearinghouse information
concerning applicable programs or services described in
subsection (b).
Subsection (f). This subsection requires the Secretary
prominently to promote the existence and availability of the
Clearinghouse in all activities of the Department of
Agriculture relating to rural areas of the United States.
Subsection (g). This subsection provides that the Secretary
will use to operate and maintain the Clearinghouse not more
than $600,000 of the funds available to the Rural Housing
Service, the Rural Utilities Service, and the Rural Business-
Cooperative Service for each fiscal year. Funds available to
the Rural Housing Service, the Rural Utilities Service, and the
Rural Business-Cooperative Service for the payment of loan
costs (as defined in section 502 of Federal Credit Reform Act
of 1990 (2 U.S.C. 661a)) will not be used to operate and
maintain the Clearinghouse.
Subtitle B--National Rural Development Partnership
Section 611. Short title
This subtitle may be cited as the ``National Rural
Development Partnership Act of 2001.''
Section 612. National Rural Development Partnership
This section amends the Consolidated Farm and Rural
Development Act (7 U.S.C. 1981 et seq.) as follows:
Section 377. National Rural Development Partnership
Subsection (a). This subsection defines terms used in this
section.
Subsection (b). Partnership:
Paragraph (1). This paragraph provides that the Secretary
will continue the National Rural Development Partnership
composed of (A) the Coordinating Committee; and (B) State rural
development councils.
Paragraph (2). This paragraph states that the purposes of
the Partnership are (A) to empower and build the capacity of
States and rural communities within States to design unique
responses to their own special rural development needs, with
local determinations of progress and selection ofprojects and
activities; (B) to encourage participants to be flexible and innovative
in establishing new partnerships and trying fresh, new approaches to
rural development issues, with responses to rural development that use
different approaches to fit different situations; and (C) to encourage
all partners in the Partnership (Federal, State, local, and tribal
governments, the private sector, and nonprofit organizations) to be
fully engaged and share equally in decisions.
Paragraph (3). This paragraph provides that a panel
consisting of representatives of the Coordinating Committee and
State rural development councils will be established to lead
and coordinate the strategic operation, policies, and practices
of the Partnership. In conjunction with the Coordinating
Committee and State rural development councils, the panel will
prepare and submit to Congress an annual report on the
activities of the Partnership.
Paragraph (4). This paragraph provides that the role of the
Federal Government in the Partnership will be that of a partner
and facilitator, with Federal agencies authorized (A) to
cooperate with States to implement the Partnership; (B) to
provide States with the technical and administrative support
necessary to plan and implement tailored rural development
strategies to meet local needs; (C) to ensure that the head of
each agency designates a senior-level agency official to
represent the agency on the Coordinating Committee and directs
appropriate field staff to participate fully with the State
rural development council within the jurisdiction of the field
staff; and (D) to enter into cooperative agreements with, and
to provide grants and other assistance to State rural
development councils.
Paragraph (5). This paragraph provides that private and
nonprofit sector organizations are encouraged to act as full
partners in the Partnership and State rural development
councils, and to cooperate with participating government
organizations in developing innovative approaches to the
solution of rural development problems.
Subsection (c). National Rural Development Coordinating
Committee:
Paragraph (1). This paragraph provides that the Secretary
will establish a National Rural Development Coordinating
Committee.
Paragraph (2). This paragraph provides that the
Coordinating Committee will be composed of (A) one
representative of each agency with rural responsibilities that
elects to participate in the Coordinating Committee; and (B)
representatives, approved by the Secretary, of (i) national
associations of State, regional, local, and tribal governments
and intergovernmental and multijurisdictional agencies and
organizations; (ii) national public interest groups; (iii)
other national nonprofit organizations that elect to
participate in the activities of the Coordinating Committee;
and (iv) the private sector.
Paragraph (3). This paragraph provides that the
Coordinating Committee will (A) provide support for the work of
the State rural development councils; (B) facilitate
coordination among Federal programs and activities, and with
State, local, tribal, and private programs and activities,
affecting rural development; (C) enhance the effectiveness,
responsiveness, and delivery of Federal programs in rural
areas; (D) gather and provide to Federal authorities
information and input for the development and implementation of
Federal programs impacting rural economic and community
development; (E) notwithstanding any other provision of law,
review and comment on policies, regulations, and proposed
legislation that affect or would affect rural areas; (F)
provide technical assistance to State rural development
councils for the implementation of Federal programs; (G)
notwithstanding any other provision of law, develop and
facilitate strategies to reduce or eliminate administrative and
regulatory impediments; and (H) require each State receiving
funds under this section to submit an annual report on the use
of the funds by the State, including a description of strategic
plans, goals, performance measures, and outcomes for the State
rural development council of the State.
Paragraph (4). This paragraph provides that an agency with
rural responsibilities that elects not to participate in the
Partnership and the Coordinating Committee will submit to
Congress a report that describes how the programmatic
responsibilities of the Federal agency that target or have an
impact on rural areas are better achieved without participation
by the agency in the Partnership, and that describes a more
effective means of partnership-building and collaboration to
achieve the programmatic responsibilities of the agency.
Subsection (d). State Rural Development Councils:
Paragraph (1). This paragraph provides that notwithstanding
chapter 63 of title 31, United States Code, each State may
elect to participate in the Partnership by entering into an
agreement with the Secretary to establish a State rural
development council.
Paragraph (2). This paragraph provides that each State
rural development council must have a nonpartisan membership
that is broad and representative of the economic, social, and
political diversity of the State, and must carry out programs
and activities in a manner that reflects the diversity of the
State.
Paragraph (3). This paragraph provides that a State rural
development council must (A) facilitate collaboration among
Federal, State, local, and tribal governments and the private
and nonprofit sectors in the planning and implementation of
programs and policies that target or have an impact on rural
areas of the State; (B) enhance the effectiveness,
responsiveness, and delivery of Federal and State programs in
rural areas of the State; (C) gather and provide to the
Coordinating Committee and other appropriate organizations
information on the condition of rural areas in the State; (D)
monitor and report on policies and programs that address, or
fail to address, the needs of the rural areas of the State; (E)
provide comments to the Coordinating Committee and other
appropriate organizations on policies, regulations, and
proposed legislation that affect or would affect the rural
areas of the State; (F) notwithstanding any other provision of
law, in conjunction with the Coordinating Committee, facilitate
the development of strategies to reduce or eliminate
conflicting or duplicative administrative or regulatory
requirements of Federal, State, local, and tribal governments;
(G) use grant or cooperative agreement funds provided by the
Partnership under an agreement entered into under paragraph (1)
to retain an Executive Director and such support staff as are
necessary and pay expenses associated with carrying out
subparagraphs (A) through (F); and (H) provide to the
Coordinating Committee an annual plan with goals and
performance measures and submit to the Coordinating Committee
an annual report on the progress of the State rural development
council in meeting the goals and measures.
Paragraph (4). This paragraph provides that a State rural
development council may solicit funds to supplement and match
funds provided under paragraph (3)(G), and may engage in
activities, in addition to those specified in paragraph (3),
appropriate to accomplish the purposes for which the State
rural development council is established.
Paragraph (5). This paragraph provides that a State rural
development council may provide comments and recommendations to
an agency with rural responsibilities related to the activities
of the State rural development council within the State.
Paragraph (6). This paragraph provides that when carrying
out a program or activity authorized by a State rural
development council or this subtitle, a member of the council
shall beregarded as a full-time employee of the Federal
Government for purposes of chapter 171 of title 28, United States Code,
and the Federal Advisory Committee Act (5 U.S.C. App.).
Paragraph (7). Federal participation in state rural
development councils.
Subparagraph (A). This subparagraph provides that the State
Director for Rural Development of a State, other employees of
the Department of Agriculture, and employees of other Federal
agencies that elect to participate in the Partnership shall
fully participate in the governance and operations of State
rural development councils on an equal basis with other members
of the State rural development councils.
Subparagraph (B). This subparagraph provides that a Federal
employee who participates in a State rural development council
cannot participate in the making of any council decision if the
agency represented by the Federal employee has any financial or
other interest in the outcome of the decision.
Subparagraph (C). This subparagraph provides that the
Office of Government Ethics, in consultation with the Attorney
General, will issue guidance to all Federal employees that
participate in State rural development councils that describes
specific decisions that would constitute a conflict of interest
for the Federal employee and from which the Federal employee
must recuse himself or herself.
Subsection (e). This subsection provides that the head of
an agency with rural responsibilities that elects to
participate in the Partnership may, and is encouraged to,
detail an employee of the agency with rural responsibilities to
the Partnership without reimbursement for a period of up to 12
months. The detail will be without interruption or loss of
civil service status or privilege. The Secretary will provide
for any additional support staff to the Partnership as the
Secretary determines to be necessary to carry out the duties of
the Partnership.
Subsection (f). This subsection authorizes appropriation of
such sums as are necessary to carry out this section. In
providing financial assistance to State rural development
councils, the Secretary and heads of other Federal agencies
will provide assistance that, to the maximum extent
practicable, is uniform in amount and targeted to newly created
State rural development councils. The Secretary must develop a
plan to decrease, over time, the Federal share of the cost of
the core operations of State rural development councils.
Notwithstanding any other provision of law limiting the ability
of an agency to provide funds to the Partnership with other
agencies, in order to carry out the purposes described in
subsection (b)(3), the Partnership will be eligible to receive
grants, gifts, contributions, or technical assistance from, or
enter into contracts with, any Federal agency. Federal agencies
are encouraged to use funds made available for programs that
target or have an impact on rural areas to provide assistance
to, and enter into contracts with, the Partnership. The
Partnership may accept private contributions. Notwithstanding
any other provision of law, a Federal agency may use funds made
available under paragraph (1) or (2) to enter into a
cooperative agreement, contract, or other agreement with a
State rural development council to support the core operations
of the State rural development council, regardless of the legal
form of organization of the State rural development council.
Subsection (g). This subsection provides that a State rural
development council must provide matching funds, or in-kind
goods or services, to support the activities of the State rural
development council in an amount that is not less than 33
percent of the amount of Federal funds received under an
agreement under subsection (d). This requirement will not apply
to funds, grants, funds provided under contracts or cooperative
agreements, gifts, contributions, or technical assistance
received by a State rural development council from a Federal
agency that are used to support one or more specific program or
project activities or to reimburse the State rural development
council for services provided to the Federal agency providing
the funds, grants, funds provided under contracts or
cooperative agreements, gifts, contributions, or technical
assistance.
Subsection (h). This subsection provides that the authority
provided under this section shall terminate on the date that is
five years after the date of enactment of this section.
Subtitle C--Consolidated Farm and Rural Development Act
Section 621. Water or waste disposal grants
This section amends Section 306(a)(2) of the Consolidated
Farm and Rural Development Act (7 U.S.C. 1926(a)(2)) by
increasing the authorization for water, waste disposal, and
wastewater facility grants from $590,000,000 to $1,500,000,000
and by adding a new subparagraph providing revolving funds for
financing water and wastewater projects. Under this
subparagraph, the Secretary may make grants to qualified
private, nonprofit entities (as determined by the Secretary) to
capitalize revolving funds for the purpose of financing water
and wastewater projects under this section. The amount of a
grant provided to an entity under this provision will not
exceed $300,000. An additional authorization of $30,000,000 for
each of fiscal years 2002 through 2006 is provided to carry out
this subparagraph.
Section 622. Rural business opportunity grants
This section extends this grant program through 2006.
Section 623. Rural Water and Wastewater Circuit Rider Program
This section amends Section 306(a) of the Consolidated Farm
and Rural Development Act (7 U.S.C. 1926(a)) by adding a new
paragraph at the end establishing a rural water and wastewater
circuit rider program based on the rural water circuit rider
program of the National Rural Water Association that (as of the
date of enactment of this paragraph) receives funding from the
Secretary, acting through the Rural Utilities Service. The
program established under this paragraph will not affect the
authority of the Secretary to carry out, during fiscal year
2002, the circuit rider program for which funds are made
available under the heading ``Rural Community Advancement
Program'' of title III of the Agriculture, Rural Development,
Food and Drug Administration, and Related Agencies
Appropriations Act, 2002. There is authorized to be
appropriated to carry out this paragraph $15,000,000 for each
of fiscal years 2003 through 2006.
Section 624. Multi-jurisdictional regional planning organizations
This section amends Section 306(a) of the Consolidated Farm
and Rural Development Act (7 U.S.C. 1926(a)) (as amended by
section 623) by adding a new paragraph at the end establishing
multi-jurisdictional regional planning organizations. The
Secretary will provide grants to multi-jurisdictional regional
planning and development organizations to pay the Federal share
of the cost of providing assistance to local governments to
improve the infrastructure, services, and businessdevelopment
capabilities of local governments and local economic development
organizations. In determining which organizations will receive a grant
under this paragraph, the Secretary will give priority to an
organization that (1) serves a rural area that, during the most recent
five-year period, had a net out-migration of inhabitants, or other
population loss, from the rural area that equals or exceeds five
percent of the population of the rural area, or had a median household
income that is less than the nonmetropolitan median household income of
the applicable State; and (2) has a history of providing substantive
assistance to local governments and economic development organizations.
The Federal share of a grant provided under this paragraph shall be not
more than 75 percent of the cost of providing assistance. The amount of
a grant provided to an organization under this paragraph shall not
exceed $100,000. There is authorized to be appropriated to carry out
this paragraph $30,000,000 for each of fiscal years 2003 through 2006.
Section 625. Certified nonprofit organizations sharing expertise
This section amends Section 306(a) of the Consolidated Farm
and Rural Development Act (7 U.S.C. 1926(a)) (as amended by
section 624) by adding at the end a paragraph providing for the
certification of nonprofit organizations that provide technical
assistance. To be certified by the Secretary to provide
technical assistance in one or more rural development fields,
an organization must be a nonprofit organization (which may
include an institution of higher education) with experience in
providing technical assistance in the applicable rural
development field, must develop a plan, approved by the
Secretary, describing the manner in which grant funds will be
used and the source of non-Federal funds, and must meet such
other criteria as the Secretary may establish, based on the
needs of eligible entities for the technical assistance. The
Secretary will make available to the public a list of certified
organizations in each area that the Secretary determines have
substantial experience in providing the assistance described in
this paragraph. The Secretary may provide grants to certified
organizations to pay for costs of providing technical
assistance to local governments and nonprofit entities to
improve the infrastructure, services, and business development
capabilities of local governments and local economic
development organizations. There is authorized to be
appropriated to carry out this paragraph $20,000,000 for each
of fiscal years 2003 through 2006.
Section 626. Loan guarantees for certain rural development loans
Subsection (a). This subsection amends Section 306(a) of
the Consolidated Farm and Rural Development Act (7 U.S.C.
1925(a)) (as amended by section 625) by adding at the end a new
paragraph allowing loan guarantees for water, wastewater, and
essential community facilities loans in cases where the project
in question is financed by the net proceeds of a bond described
in section 144(a)(12)(B)(ii) of the Internal Revenue Code of
1986. To be eligible for a loan guarantee under subparagraph
(A), an individual or entity offering to purchase the loan must
demonstrate to the Secretary that the person has the
capabilities and resources necessary to service the loan in a
manner that ensures the continued performance of the loan, as
determined by the Secretary, and the ability to generate
capital to provide borrowers of the loan with the additional
credit necessary to properly service the loan.
Subsection (b). This subsection amends Section 310B of the
Consolidated Farm and Rural Development Act (7 U.S.C. 1932) by
adding at the end a provision allowing the Secretary to
guarantee loans made in subsection (a) to finance the issuance
of bonds for the projects described in section 306(a)(25).
Section 627. Rural Firefighters and Emergency Personnel Grants Program
This section amends Section 306(a) of the Consolidated Farm
and Rural Development Act (7 U.S.C. 1926(a)) (as amended by
section 626(a)) by adding at the end a paragraph creating a
rural firefighters and emergency medical personnel grant
program. The Secretary may make grants to units of general
local government and Indian tribes (as defined in section 4 of
the Indian Self-Determination and Education Assistance Act (25
U.S.C. 450b)) to pay the cost of training firefighters and
emergency medical personnel in firefighting, emergency medical
practices, and responding to hazardous materials and bioagents
in rural areas. Not less than 60 percent of the amounts made
available for competitively awarded grants under this paragraph
will be used to provide grants to fund partial scholarships for
training of individuals at training centers approved by the
Secretary. In awarding grants under this clause, the Secretary
shall give priority to grant applicants with relatively low
transportation costs considering the location of the grant
applicant and the proposed location of the training. A grant
may be used to provide financial assistance to State and
regional centers that provide training for firefighters and
emergency medical personnel for improvements to the training
facility, equipment, curricula, and personnel. Not more than
$2,000,000 shall be provided to any single training center for
any fiscal year. A grant may be used to provide the Federal
share of the costs of establishing a regional training center
for firefighters and emergency medical personnel. The amount of
a grant under this subclause for a training center shall not
exceed 50 percent of the cost of establishing the training
center. Out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall transfer to
the Secretary of Agriculture to carry out this paragraph (1)
not later than 30 days after the date of enactment of this Act,
$10,000,000; and (2) on October 1, 2002, and each October 1
thereafter through October 1, 2005, $30,000,000. The Secretary
shall be entitled to receive, shall accept, and shall use to
carry out this section the funds transferred, without further
appropriation. Funds transferred under this paragraph shall
remain available until expended.
Section 628. Emergency Community Water Assistance Grant Program
This section amends Section 306A(i) of the Consolidated
Farm and Rural Development Act (7 U.S.C. 1926c(e)) to extend
this program through 2006.
Section 629. Water and Waste Facility Grants for Native American Tribes
This section authorizes appropriations of $20,000,000 a
year for water and waste facility grants to benefit Indian
tribes.
Section 630. Water Systems for Rural and Native Villages in Alaska
This section amends Section 306D(d)(1) of the Consolidated
Farm and Rural Development Act (7 U.S.C. 1926d(d)(1)) to extend
this provision through 2006.
Section 631. Rural Cooperative Development Grants
This section amends Section 310B(e)(9) of the Consolidated
Farm and Rural Development Act (7 U.S.C. 1932(e)(9)) to extend
the grant program to 2006.
Section 632. Grants to broadcasting systems
This section amends Section 310B(f) of the Consolidated
Farm and Rural Development Act by authorizing appropriations of
$5 million a year for fiscal years 2002 through 2006 in
appropriated funds for grants to statewide nonprofit public
television broadcasting systems.
Section 633. Business and Industry Loan modifications
This section amends Section 310 B of the Consolidated Farm
and Rural Development Act by striking subsection (g) and
inserting a new subsection (g) making modifications to the
business and industry direct and guaranteed loan program.
Paragraph (1). This paragraph allows the Secretary to
guarantee a loan under subsection (a) to farmers, ranchers, or
cooperatives to purchase start up capital stock to expand or
create a cooperative venture that will process agricultural
commodities or otherwise process value-added agricultural
products. In determining the appropriateness of a loan
guarantee, the Secretary must fully review the feasibility and
other relevant aspects of the cooperative venture to be
established, may not require a review of the financial
condition or statements of any individual in the cooperative
other than the applicant, and must base any guarantee on the
merits of the cooperative venture to be established. The
Secretary is restricted from requiring additional collateral by
a farmer or rancher other than the stock purchased or issued
pursuant to the loan and guarantee of the loan. A farmer or
rancher must produce the agricultural commodity that will be
processed by the cooperative to be eligible for the loan
guarantee. The cooperative may contract for services to process
agricultural commodities, or otherwise process value-added
agricultural products, during the five-year period beginning on
the date of the startup in order to provide adequate time for
planning and construction. With respect to existing
cooperatives, the Secretary may guarantee a loan under
subsection (a) to a farmer or rancher to join a cooperative in
order to sell the agricultural commodities or products produced
by the farmer or rancher. Financial information required by the
Secretary will be provided in the manner generally required by
commercial agricultural lenders in the area.
Paragraph (2). This paragraph allows the Secretary to make
or guarantee a loan under subsection (a) to a cooperative that
is headquartered in a metropolitan area if the loan is used for
a project or venture described in subsection (a) of Section 310
B of the Consolidated Farm and Rural Development Act that is
located in a rural area. A cooperative organization owned by
farmers or ranchers that is eligible for a business and
industry loan under made or guaranteed under subsection (a)
will be eligible to refinance an existing loan with a new
lender if the cooperative organization is current and
performing with respect to the existing loan and is not, and
has not been, in default with respect to the existing loan, and
if there is adequate security or full collateral for the
refinanced loan.
Paragraph (3). This paragraph allows the Secretary to
require that any appraisal made in connection with a loan made
or guaranteed under subsection (a) Section 310 B of the
Consolidated Farm and Rural Development Act be conducted by a
specialized appraiser that uses standards that are similar to
standards used for similar purposes in the private sector, as
determined by the Secretary.
Paragraph (4). This paragraph allows the Secretary to
assess an one-time fee for any loan guaranteed under subsection
(a) Section 310 B of the Consolidated Farm and Rural
Development Act in an amount that does not exceed 2 percent of
the guaranteed principal portion of the loan.
Section 634. Value-added Intermediary Relending Program
This section amends section 310B of the Consolidated Farm
and Rural Development Act by adding a new subsection
establishing the ``Value-Added Intermediary Relending
Program.''
Paragraph (1). This paragraph directs the Secretary to make
loans under the terms and conditions of the intermediary
relending program established under section 1323(b)(2)(C) of
the Food Security Act of 1985.
Paragraph (2). Loans. This paragraph directs the Secretary
to make loans to eligible intermediaries to make loans for
projects to establish, enlarge, and operate enterprises that
add value to agricultural commodities and products of
agricultural commodities.
Paragraph (3). This paragraph makes State agencies eligible
as intermediaries to receive loans.
Paragraph (4). This paragraph directs eligible
intermediaries to give preference to bioenergy projects in
accordance with regulations promulgated by the Secretary.
Paragraph (5). This paragraph provides that the capital
provided for a project by an ultimate recipient and assisted
with loan funds made available under paragraph (2) will consist
of not more than 15 percent of the total cost of a project and
not less than 50 percent of the equity funds provided by
agricultural producers.
Paragraph (6). This paragraph provides that a loan made to
an intermediary will not exceed a term of 30 years. The
interest on such a loan will be 0 percent for the first two
years and 2 percent for each of the remaining years.
Paragraph (7). This paragraph provides that an intermediary
or ultimate recipient will be eligible to receive not more than
$2,000,000 of the loan funds made available under paragraph
(2), but this limitation will not apply in the case of a State
agency with respect to loan funds provided to the State agency
as an intermediary.
Paragraph (8). This paragraph authorizes $15,000,000 to be
appropriated for each of fiscal years 2003 through 2006 to
carry out this subsection.
Section 635. Use of rural development loans and grants for other
purposes
This section amends Subtitle A of the Consolidated Farm and
Rural Development Act (7 U.S.C. 1921 et seq.) (as amended by
section 508) by adding at the end a section allowing the use of
rural development loans and grants for other purposes. It
provides that if, after making a loan or a grant described in
section 381E(d), the Secretary determines that the
circumstances under which the loan or grant was made have
sufficiently changed to make the project or activity for which
the loan or grant was made available no longer appropriate, the
Secretary may allow the loan borrower or grant recipient to use
property (real and personal) purchased or improved with the
loan or grant funds, or proceeds from the sale of property
(real and personal) purchased or improved with such funds, for
another project or activity that (as determined by the
Secretary): (1) will be carried out in the same area as the
original project or activity; (2) meets the criteria for a loan
or a grant described in section 381E(d); and (3) satisfies such
additional requirements as are established by the Secretary.
Section 636. Simplified application forms for loan guarantees
This section amends section 333A of the Consolidated Farm
and Rural Development Act (as amended by section 526) by
striking subsection (g) and inserting a new subsection (g) that
directs the Secretary to simplify application forms for loan
guarantees.
Paragraph (1). This paragraph directs the Secretary to
provide to lenders a short, simplified application for
guarantees under this title of (A) farmer program loans with
principal of $100,000 or less, and (B) business and industry
guaranteed loans under section 310B(a)(1) the principal amount
of which is $400,000 or less in the case of a loan guarantee
made during fiscal year 2002 or 2003 and, in the case of a loan
guarantee made during any subsequent fiscal year, $400,000 or
less, or $600,000 or less if the Secretary determines that
there is not a significant increased risk of a default on the
loan.
Paragraph (2). This paragraph directs the Secretary to
develop an application process that accelerates, to the maximum
extent practicable, the processing of applications for water
and waste disposal grants or direct or guaranteed loans under
paragraph (1) or (2) of section 306(a) for which the grant
award amount or principal loan amount, respectively, is
$300,000 or less.
Paragraph (3). This paragraph directs the Secretary, in
developing an application under this subsection, to consult
with commercial and cooperative lenders and to ensure that (i)
the form can be completed manually or electronically, at the
option of the lender; (ii) the form minimizes the documentation
required to accompany the form; (iii) the cost of completing
and processing the form is minimal; and (iv) the form can be
completed and processed in an expeditious manner.
Section 637. Definition of rural and rural area
Subsection (a). This subsection amends Section 343(a) of
the Consolidated Farm and Rural Development Act (7 U.S.C.
1991(a)) by adding at the end a definition of ``rural'' and
``rural area.'' It states that except as otherwise provided in
this paragraph, the terms ``rural'' and ``rural area'' mean a
city, town, or unincorporated area that has a population of
50,000 inhabitants or less, other than an urbanized area
immediately adjacent to a city, town, or unincorporated area
that has a population in excess of 50,000 inhabitants. For the
purpose of water and waste disposal grants and direct and
guaranteed loans provided under paragraphs (1) and (2) of
section 306(a), the terms ``rural'' and ``rural area'' mean a
city, town, or unincorporated area that has a population of no
more than 10,000 inhabitants. For the purpose of community
facility direct and guaranteed loans and grants under
paragraphs (1), (19), (20), and (21) of section 306(a), the
terms ``rural'' and ``rural area'' mean a city, town, or
unincorporated area that has a population of no more than
50,000 inhabitants. For the purpose of business and industry
direct and guaranteed loans under section 310B(a)(1), the terms
``rural'' and ``rural area'' mean any area other than a city or
town that has a population of greater than 50,000 inhabitants
and the immediately adjacent urbanized area of such city or
town. For the purpose of provisions dealing with multi-
jurisdictional regional planning organizations and the national
rural development partnership (sections 306(a)(23) and 377),
the term ``rural area'' means (i) all the territory of a State
that is not within the boundary of any standard metropolitan
statistical area; and (ii) all territory within any standard
metropolitan statistical area within a census tract having a
population density of less than 20 persons per square mile, as
determined by the Secretary according to the most recent census
of the United States as of any date. For the purpose of
provisions dealing with the rural entrepreneurs and
microenterprise assistance program and national rural
cooperative and business equity fund (section 378 and subtitle
G), the term ``rural area'' means an area that is located (i)
outside a standard metropolitan statistical area; or (ii)
within a community that has a population of 50,000 inhabitants
or less.
Subsection (b) Conforming Amendments. This subsection
provides for conforming amendments.
Section 638. Rural Entrepreneurs and Microenterprise Program
This section amends Subtitle D of the Consolidated Farm and
Rural Development Act (as amended by section 612) by adding at
the end a section establishing the Rural Entrepreneurs And
Microenterprise Assistance Program.
Subsection (a). This subsection defines terms used in this
section.
Subsection (b). Establishment:
Paragraph (1). This paragraph directs the Secretary to use
$10,000,000 in funds transferred from the Treasury in each of
fiscal years 2002 through 2006 to establish a rural
entrepreneur and microenterprise program.
Paragraph (2). This paragraph establishes that the purpose
of the program will be to help low and moderate income
individuals acquire the skills necessary to establish new small
businesses in rural areas and receive continuing technical
assistance as the individuals begin operating the small
businesses.
Subsection (c). Assistance:
Paragraph (1). This paragraph allows the Secretary to make
a grant under this section to a qualified organization to (A)
provide training, technical assistance, or microcredit to a
rural entrepreneur; (B) provide training, operational support,
or a rural capacity building service to a qualified
organization to assist the qualified organization in developing
microenterprise training, technical assistance, and other
related services; (C) assist in researching and developing the
best practices in delivering training, technical assistance,
and microcredit to rural entrepreneurs; and (D) to carry out
such other projects and activities as the Secretary determines
are consistent with the purposes of this section.
Paragraph (2). This paragraph provides that of the amount
of funds made available for a fiscal year to make grants under
this section, the Secretary must ensure that not less than 75
percent of funds are used to carry out activities described in
paragraph (1)(A), and not more than 25 percent of the funds are
used to carry out activities described in subparagraphs (B)
through (D) of paragraph (1). No single qualified organization
may receive more than 10 percent of the total funds that are
made available for a fiscal year to carry out this section. Not
more than 15 percent of assistance received by a qualified
organization for a fiscal year under this section may be used
for administrative expenses.
Subsection (d). This subsection allows a qualified
organization that receives a grant under this section to use it
to provide assistance to other qualified organizations, such as
small or emerging qualified organizations, subject to
regulations the Secretary may promulgate.
Subsection (e). This subsection requires the Secretary to
ensure that at least 50 percent of the grant funds under this
section is used to benefit low-income individuals identified by
the Secretary, including individuals residing on Indian
reservations.
Subsection (f). This subsection requires the Secretary to
ensure, to the maximum extent practicable, that grant
recipients include qualified organizations of varying sizes,
and qualified organizations that serve racially and ethnically
diverse populations.Subsection (g). This subsection provides
that the Federal share of the cost of a project carried out using funds
from a grant under this section shall be 75 percent. The non-Federal
share of the cost of a project may be provided in cash (including
through fees, grants (including community development block grants),
and gifts), or in kind.
Section 639. Rural seniors
Subsection (a). This subsection amends subtitle D of the
Consolidated Farm and Rural Development Act (7 U.S.C. 1981 et
seq.) (as amended by section 638) by adding a new section
establishing an Interagency Coordinating Committee for rural
seniors. The membership of the Committee will consist of (1)
the Under Secretary of Agriculture for Rural Development, who
shall serve as chairperson of the Committee; (2) two
representatives of the Secretary of Health and Human Services,
of whom one shall have expertise in the field of health care
and one shall have expertise in the field of programs under the
Older Americans Act of 1965; (3) one representative of the
Secretary of Housing and Urban Development; (4) one
representative of the Secretary of Transportation; and (5)
representatives of such other Federal agencies as the Secretary
may designate. The duties of the Committee will be to (1) study
health care, transportation, technology, housing,
accessibility, and other areas of need of rural seniors; (2)
identify successful examples of senior care programs in rural
communities that could serve as models for other rural
communities; and (3) not later than one year after the date of
enactment of this section, submit recommendations for
administrative and legislative action to the Secretary, the
Committee on Agriculture of the House of Representatives, and
the Committee on Agriculture, Nutrition, and Forestry of the
Senate. Funds available to any Federal agency may be used to
carry out interagency activities under this section.
Subsection (b). This subsection amends Subtitle D of the
Consolidated Farm and Rural Development Act (7 U.S.C. 1981 et
seq.) (as amended by subsection (a)) to provide for grants for
programs for rural seniors. It directs the Secretary to make
grants to nonprofit organizations (including cooperatives) to
pay the Federal share of the cost of programs that (1) provide
facilities, equipment, and technology for seniors in a rural
area; and (2) may be replicated in other rural areas. The
Federal share of a grant under this section shall be not more
than 20 percent of the cost of a program. The Secretary must
give priority to proposals that leverage resources to meet
multiple rural community goals in selecting programs to receive
grants under section. Appropriations of $25,000,000 for each of
fiscal years 2003 through 2006 is authorized to carry out this
section. This subsection also amends Section 306(a)(19) of the
Consolidated Farm and Rural Development Act (7 U.S.C.
1926(a)(19)) to provide that for each fiscal year, not less
than 12.5 percent of the funds made available to carry out that
section will be reserved for grants to pay the Federal share of
the cost of developing and constructing senior facilities, or
carrying out other projects that mainly benefit seniors, in
rural areas. These funds will be reserved only until April 1 of
each fiscal year.
Section 640. Children's day care facilities
This section amends Section 306(a)(19) of the Consolidated
Farm and Rural Development Act (7 U.S.C. 1926(a)(19)) (as
amended by Section 639) by adding a reservation of funds for
children's day care facilities. For each fiscal year, not less
than 10 percent of the funds made available to carry out this
paragraph will be reserved for grants to pay the Federal share
of the cost of developing and constructing day care facilities
for children in rural areas. These funds will be reserved only
until April 1 of each fiscal year.
Section 641. Rural Telework
This section amends Subtitle D of the Consolidated Farm and
Rural Development Act (7 U.S.C. 1981 et seq.) (as amended by
section 639(b)) by adding the following:
Section 379B. Rural Telework
Subsection (a). This subsection defines terms used in this
section.
Subsection (b). Rural Telework Institute:
Paragraph (1). This paragraph directs the Secretary to make
grants to an eligible organization to pay the Federal share of
the cost of establishing and operating a regional rural
telework institute to carry out projects described in this
section.
Paragraph (2). This paragraph directs the Secretary to
establish criteria that an organization shall meet to be
eligible to receive a grant under this subsection.
Paragraph (3). This paragraph sets a deadline for the
Secretary to make initial grants of not later than one year
after the date on which funds are first made available.
Paragraph (4). This paragraph directs the institute to use
grant funds obtained under this subsection to carry out a five-
year project (A) to serve as a clearinghouse for telework
research and development; (B) to conduct outreach to rural
communities and rural workers; (C) to develop and share best
practices in rural telework within the region and throughout
the United States; (D) to develop innovative, market-driven
telework projects and joint ventures with the private sector
that employ workers in rural areas in jobs that promote
economic self-sufficiency; (E) to share information about the
design and implementation of telework arrangements; (F) to
support private sector businesses that are transitioning to
telework; (G) to support and assist telework projects and
individuals at the State and local level; and (H) to perform
such other functions as the Secretary considers appropriate.
Paragraph (5). This paragraph defines the non-Federal
share. To receive a grant under this subsection, an eligible
organization shall agree to obtain, after the application of
the eligible organization has been approved and notice of award
has been issued, contributions from non-Federal sources that
are equal to 50 percent of the amount of the grant during each
of the first, second, and third years of a project and 100
percent of the amount of the grant during each of the fourth
and fifth years of the project. An Indian tribe may use Federal
funds made available to the tribe for self-governance to pay
the non-Federal contributions required under this paragraph.
The non-Federal contributions may be in the form of in-kind
contributions, including office equipment, office space, and
services.
Subsection (c). Telework Grants:
Paragraph (1). This paragraph directs the Secretary to make
grants, subject to paragraphs (2) through (5), to eligible
entities to pay the Federal share of the cost of obtaining
equipment and facilities to establish or expand telework
locations in rural areas, and operating telework locations in
rural areas.
Paragraph (2). This paragraph provides that to be eligible
to receive a grant under this subsection, an eligible entity
must be a nonprofit organization or educational institution in
a ruralarea and must apply to the Secretary, and receive
approval, demonstrating that the eligible entity has adequate resources
and capabilities to establish or expand a telework location in a rural
area.
Paragraph (3). This paragraph provides that to receive a
grant under this section, an eligible organization must agree
to obtain, after the application of the eligible organization
has been approved and notice of award has been issued,
contributions from non-Federal sources that are equal to 50
percent of the amount of the grant. Indian Tribes may use
Federal funds made available to the tribe for self-governance
to pay the non-Federal contributions. The non-Federal
contributions may be in the form of in-kind contributions,
including office equipment, office space, and services, and may
not be made from funds made available for community development
block grants under title I of the Housing and Community
Development Act of 1974.
Paragraph (4). This paragraph prohibits the Secretary from
providing a grant under this subsection to establish, expand,
or operate a telework location in a rural area more than two
years after the establishment of the telework location.
Paragraph (5). This paragraph provides that the amount of a
grant provided to an eligible entity will not exceed $500,000.
Subsection (d). This subsection provides that an entity
that receives funds under this section will be subject to the
provisions of Federal law (including regulations), administered
by the Secretary of Labor or the Equal Employment Opportunity
Commission, that govern the responsibilities of employers to
employees.
Subsection (e). This subsection provides that not later
than 180 days after the date of enactment of this section, the
Secretary must promulgate regulations to carry out this
section.
Subsection (f). This subsection authorizes to be
appropriated to carry out this section $30,000,000 for each
fiscal year, of which $5,000,000 shall be provided to establish
an institute under subsection (b).
Section 642. Historic Barn Preservation
This section amends Subtitle D of the Consolidated Farm and
Rural Development Act (7 U.S.C. 1981 et seq.) (as amended by
section 641) by adding at the end the following section:
Section 379C. Historic Barn Preservation
Subsection (a). This subsection defines terms used in this
section.
Subsection (b). This subsection provides that the Secretary
will establish a historic barn preservation program (1) to
assist States in developing a listing of historic barns; (2) to
collect and disseminate information on historic barns; (3) to
foster educational programs relating to the history,
construction techniques, rehabilitation, and contribution to
society of historic barns; and (4) to sponsor and conduct
research on the history of barns and best practices to protect
and rehabilitate historic barns from the effects of decay,
fire, arson, and natural disasters.
Subsection (c). This subsection provides that the Secretary
may make grants to, or enter into contracts or cooperative
agreements with, eligible applicants to carry out eligible
projects. Eligible projects are projects (A) to rehabilitate or
repair a historic barn; (B) to preserve a historic barn through
the installation of a fire protection system, including
fireproofing or fire detection system and sprinklers, and the
installation of a system to prevent vandalism; and (C) to
identify, document, and conduct research to develop and
evaluate appropriate techniques or best practices for
protecting historic barns. An eligible applicant that receives
a grant for a project under this subsection shall comply with
any standards established by the Secretary of the Interior for
historic preservation projects.
Subsection (d). This subsection authorizes to be
appropriated to carry out this section, $25,000,000 for the
period of fiscal years 2002 through 2006, to remain available
until expended.
Section 643. Grants for Emergency Weather Radio Transmitters
This section amends Subtitle D of the Consolidated Farm and
Rural Development Act (7 U.S.C. 1981 et seq.) (as amended by
section 642)) by adding at the end the following section:
Section 379D. Grants for Emergency Weather Radio Transmitters
Subsection (a). This subparagraph allows the Secretary,
acting through the Administrator of the Rural Utilities
Service, to make grants to public and nonprofit entities for
the Federal share of the cost of acquiring radio transmitters
to increase coverage of rural areas by the emergency weather
radio broadcast system of the National Oceanic and Atmospheric
Administration.
Subsection (b). This subsection provides that to be
eligible for a grant under this section, an applicant must
provide to the Secretary (1) a binding commitment from a tower
owner to place the transmitter on a tower; and (2) a
description of how the tower placement will increase coverage
of a rural area by the emergency weather radio broadcast system
of the National Oceanic and Atmospheric Administration.
Subsection (c). This subsection provides that a grant
provided under this section must be not more than 75 percent of
the cost of acquiring a radio transmitter described in
subsection (a).
Subsection (d). This subsection authorizes to be
appropriated to carry out this section $2,000,000 for each of
fiscal years 2002 through 2006.
Section 644. Bioenergy and biochemical projects
This section amends Subtitle D of the Consolidated Farm and
Rural Development Act (7 U.S.C. 1981 et seq.) (as amended by
section 643) is by adding at the end a section providing that
in carrying out rural development loan, loan guarantee, and
grant programs under this title, the Secretary shall provide a
priority for bioenergy and biochemical projects.
Section 645. Delta Regional Authority
This section amends Sections 382M(a) and 382N of the
Consolidated Farm and Rural Development Act (7 U.S.C. 2009aa-
12(a) and 13) to extend the Delta Regional Authority through
2006.
Section 646. SEARCH grants for small communities
This section amends the Consolidated Farm and Rural
Development Act (as amended by section 604) by adding at the
end a new Subtitle J containing the following sections:
Section 386A. Definitions
This section defines terms used in this subtitle.
Section 386B. SEARCH grant program
Subsection (a). This subsection states that the SEARCH
Grant Program is established. The term `SEARCH grant' means a
grant for special environmental assistance for the regulation
of communities and habitat awarded under section 386B(e)(3).
Subsection (b). This subsection provides that not later
than October 1 of each fiscal year, a State may submit to the
Secretary an application to receive a grant under subsection
(c) for the fiscal year. An application must contain a
certification by the State that the State has appointed members
to the council of the State under subsection (c), and must
contain other information as the Secretary may reasonably
require.
Subsection (c). This subsection provides that for each
fiscal year after the date of enactment of this subtitle, not
later than 60 days after the date on which the Office of
Management and Budget apportions any amounts made available
under this subtitle, the Secretary will, on request by a State
(A) determine whether any application submitted by the State
under subsection (b) meets the requirements of subsection (b);
and (B) if the Secretary determines that the application meets
the requirements of subsection (b), award a grant of not to
exceed $1,000,000 to the State, to be used by the council of
the State to award SEARCH grants under subsection (e). The
aggregate amount of grants awarded to States other than Alaska,
Hawaii, or one of the 48 contiguous States, under this
subsection shall not exceed $1,000,000 for any fiscal year.
Subsection (d). This subsection provides for the
establishment in each State of an independent citizens' council
to carry out the duties described in this section. Each council
will be composed of 9 members, appointed by the Governor of the
State. Each member of a council will (i) represent an
individual region of the State, as determined by the Governor
of the State in which the council is established; (ii) reside
in a small community of the State; and (iii) be representative
of the populations of the State. Before a State receives funds
under this subtitle, the State shall appoint members to the
council for the fiscal year, except that not more than 1 member
shall be an agent, employee, or official of the State
government. Each council shall select a chairperson from among
the members of the council, except that a member who is an
agent, employee, or official of the State government shall not
serve as chairperson. An officer, employee, or agent of the
Federal Government may participate in the activities of the
council in an advisory capacity and at the invitation of the
council. On the request of the council of a State, the State
Director for Rural Development of the State shall provide
advice and consultation to the council. Each council shall
review applications for, and recommend awards of, SEARCH grants
to small communities that meet the eligibility criteria under
subsection (c). In awarding a SEARCH grant, a State must follow
the recommendations of the council of the State, must award the
funds for any recommended environmental project in a timely and
expeditious manner, and must not award a SEARCH grant to a
grantee or project in violation of any law of the State
(including a regulation). A small community that receives a
SEARCH grant under this section shall not be required to
provide matching funds.
Subsection (e). This subsection provides that a SEARCH
grant will be awarded under this section only to a small
community for one or more environmental projects for which the
small community (A) needs funds to carry out initial
feasibility or environmental studies before applying to
traditional funding sources; or (B) demonstrates, to the
satisfaction of the council, that the small community has been
unable to obtain sufficient funding from traditional funding
sources. The council shall establish such deadline by which
small communities shall submit applications for grants under
this section as will permit the council adequate time to review
and make recommendations relating to the applications. A small
community shall submit an application to the council in the
State in which the small community is located. An application
must include (i) a description of the proposed environmental
project (including an explanation of how the project would
assist the small community in complying with an environmental
law (including a regulation)); (ii) an explanation of why the
project is important to the small community; (iii) a
description of all actions taken with respect to the project,
including a description of any attempt to secure funding and a
description of demonstrated need for funding for the project,
as of the date of the application; and (iv) a SEARCH grant
application form provided by the council, completed and with
all required supporting documentation. Generally, not later
than March 5 of each fiscal year, each council will review all
applications received and recommend for award SEARCH grants to
small communities based on an evaluation of the eligibility
criteria and the content of the application. The State may
extend the deadline of March 5 by not more than 10 days in a
case in which the receipt of recommendations from a council is
delayed because of circumstances beyond the control of the
council, as determined by the State. If, for any fiscal year,
any unexpended funds remain after SEARCH grants are awarded,
the council may repeat the application and review process so
that any remaining funds may be recommended for award, and
awarded, not later than July 30 of the fiscal year. Any
unexpended funds that are not awarded will be retained by the
State for award during the following fiscal year. A State that
accumulates a balance of unexpended funds of more than
$3,000,000 will be ineligible to apply for additional funds for
SEARCH grants until such time as the State expends the portion
of the balance that exceeds $3,000,000.
Section 386C. Report
This section provides that not later than September 1 of
the first fiscal year for which a SEARCH grant is awarded by a
council, and annually thereafter, the council shall submit to
the Secretary a report that (1) describes the number of SEARCH
grants awarded during the fiscal year; (2) identifies each
small community that received a SEARCH grant during the fiscal
year; (3) describes the project or purpose for which each
SEARCH grant was awarded, including a statement of the benefit
to public health or the environment of the environmental
project receiving the grant funds; and (4) describes the status
of each project or portion of a project for which a SEARCH
grant was awarded, including a project or portion of a project
for which a SEARCH grant was awarded for any fiscal year before
the fiscal year in which the report is submitted.
Section 386D. Funding
This section authorizes to be appropriated to carry out
section 386B(c) $51,000,000, of which not to exceed $1,000,000
shall be used to make grants under section 386B(c). If funds to
carry out section 386B(c) are made available for a fiscal year
in an amount that is less than the amount authorized under
section 386D(a) for the fiscal year, the appropriated funds
shall be divided equally among the 50 States. If, for any
fiscal year, a State does not apply, or does not qualify, to
receive funds undersection 386B(b), the funds that would have
been made available to the State under section 386B(c) on submission by
the State of a successful application under section 386B(b) shall be
redistributed for award under this subtitle among States, the councils
of which awarded one or more SEARCH grants during the preceding fiscal
year. There are authorized to be appropriated such sums as are
necessary to carry out the provisions of this subtitle (other than
section 386B(c)).
Section 647. Northern Great Plains Regional Authority
This section amends the Consolidated Farm and Rural
Development Act (as amended by section 646) by adding at the
end the following:
Section 387A. Definitions
This section defines terms used in this subtitle. The term
``region'' means the States of Iowa, Minnesota, Nebraska, North
Dakota, and South Dakota.
Section 387B. Northern Great Plains Regional Authority
Subsection (a). Establishment:
Paragraph (1). This paragraph provides that there is
established the Northern Great Plains Regional Authority.
Paragraph (2). This paragraph provides that the Authority
will be composed of (A) a Federal member, to be appointed by
the President, with the advice and consent of the Senate; and
(B) the Governor (or a designee of the Governor) of each State
in the region that elects to participate in the Authority.
Paragraph (3). This paragraph provides that the Authority
will be headed by (A) the Federal member, who will serve as the
Federal cochairperson and as a liaison between the Federal
Government and the Authority; and (B) a State cochairperson,
who will be a Governor of a participating State in the region
and will be elected by the State members for a term of not less
than one year.
Subsection (b). Alternate Members:
Paragraph (1). This paragraph provides that the State
member of a participating State may have a single alternate,
who will be a resident of that State and appointed by the
Governor of the State.
Paragraph (2). This paragraph provides that the President
will appoint an alternate Federal cochairperson.
Paragraph (3). This paragraph provides that a State
alternate shall not be counted toward the establishment of a
quorum of the Authority in any instance in which a quorum of
the State members is required to be present.
Paragraph (4). This paragraph provides that bo power or
responsibility of the Authority specified in paragraphs (2) and
(3) of subsection (c), and no voting right of any Authority
member, shall be delegated to any person who is not an
Authority member, or who is not entitled to vote in Authority
meetings.
Subsection (c). Voting:
Paragraph (1). This paragraph provides that a decision by
the Authority will require a majority vote of the Authority
(not including any member representing a State that is
delinquent under subsection (g)(2)) to be effective.
Paragraph (2). This paragraph provides that a quorum of
State members will be required to be present for the Authority
to make any policy decision, including (A) a modification or
revision of an Authority policy decision; (B) approval of a
State or regional development plan; and (C) any allocation of
funds among the States.
Paragraph (3). This paragraph provides that the approval of
project and grant proposals will be a responsibility of the
Authority and will be conducted in accordance with section
387I.
Paragraph (4). This paragraph provides that an alternate
member will vote in the case of the absence, death, disability,
removal, or resignation of the Federal or State representative
for which the alternate member is serving.
Subsection (d). This subsection provides that the Authority
will (1) develop, on a continuing basis, comprehensive and
coordinated plans and programs to establish priorities and
approve grants for the economic development of the region,
giving due consideration to other Federal, State, and local
planning and development activities in the region; (2) not
later than 220 days after the date of enactment of this
subtitle, establish priorities in a development plan for the
region (including five-year regional outcome targets); (3)
assess the needs and assets of the region based on available
research, demonstrations, investigations, assessments, and
evaluations of the region prepared by Federal, State, and local
agencies, universities, local development districts, and other
nonprofit groups; (4) formulate and recommend to the Governors
and legislatures of States that participate in the Authority
forms of interstate cooperation; (5) work with State and local
agencies in developing appropriate model legislation; (6)
enhance the capacity of, and provide support for, local
development districts in the region, or if no local development
district exists in an area in a participating State in the
region, foster the creation of a local development district;
(7) encourage private investment in industrial, commercial, and
other economic development projects in the region; and (8)
cooperate with and assist State governments with economic
development programs of participating States.
Subsection (e). This subsection provides that in carrying
out subsection (d), the Authority may (1) hold such hearings,
sit and act at such times and places, take such testimony,
receive such evidence, and print or otherwise reproduce and
distribute a description of the proceedings and reports on
actions by the Authority as the Authority considers
appropriate; (2) authorize, through the Federal or State
cochairperson or any other member of the Authority designated
by the Authority, the administration of oaths if the Authority
determines that testimony should be taken or evidence received
under oath; (3) request from any Federal, State, or local
department or agency such information as may be available to or
procurable by the department or agency that may be of use to
the Authority in carrying out duties of the Authority; (4)
adopt, amend, and repeal bylaws and rules governing the conduct
of Authority business and the performance of Authority duties;
(5) request the head of any Federal department or agency to
detail to the Authority such personnel as the Authority
requires to carry out duties of the Authority, each such detail
to be without loss of seniority, pay, or other employee status;
(6) request the head of any State department or agency or local
government to detail to the Authority such personnel as the
Authority requires to carry out duties of the Authority, each
such detail to be without loss of seniority, pay, or other
employee status; (7) provide for coverage of Authority
employees in a suitable retirement and employeebenefit system
by making arrangements or entering into contracts with any
participating State government, or by otherwise providing retirement
and other employee benefit coverage; (8) accept, use, and dispose of
gifts or donations of services or real, personal, tangible, or
intangible property; (9) enter into and perform such contracts, leases,
cooperative agreements, or other transactions as are necessary to carry
out Authority duties, including any contracts, leases, or cooperative
agreements with (A) any department, agency, or instrumentality of the
United States; (B) any State (including a political subdivision,
agency, or instrumentality of the State); or (C) any person, firm,
association, or corporation; and (10) establish and maintain a central
office and field offices at such locations as the Authority may select.
Subsection (f). This subsection provides that a Federal
agency will (1) cooperate with the Authority; and (2) provide,
on request of the Federal cochairperson, appropriate assistance
in carrying out this subtitle, in accordance with applicable
Federal laws (including regulations).
Subsection (g). Administrative Expenses:
Paragraph (1). This paragraph provides that administrative
expenses of the Authority (except for the expenses of the
Federal cochairperson, including expenses of the alternate and
staff of the Federal cochairperson, which shall be paid solely
by the Federal Government) will be paid by the Federal
Government, in an amount equal to 50 percent of the
administrative expenses, and by the States in the region
participating in the Authority, in an amount equal to 50
percent of the administrative expenses.
Paragraph (2). This paragraph provides that the share of
administrative expenses of the Authority to be paid by each
State shall be determined by the Authority. The Federal
cochairperson shall not participate or vote in any decision
under this paragraph. If a State is delinquent in payment of
the State's share of administrative expenses of the Authority
under this subsection, no assistance under this subtitle shall
be furnished to the State (including assistance to a political
subdivision or a resident of the State), and no member of the
Authority from the State shall participate or vote in any
action by the Authority.
Subsection (h). Compensation:
Paragraph (1). This paragraph provides that the Federal
cochairperson will be compensated by the Federal Government at
level III of the Executive Schedule in subchapter II of chapter
53 of title 5, United States Code.
Paragraph (2). This paragraph provides that the alternate
Federal cochairperson (A) will be compensated by the Federal
Government at level V of the Executive Schedule described in
paragraph (1); and (B) when not actively serving as an
alternate for the Federal cochairperson, will perform such
functions and duties as are delegated by the Federal
cochairperson.
Paragraph (3). This paragraph provides that a State will
compensate each member and alternate representing the State on
the Authority at the rate established by law of the State. No
State member or alternate member shall receive any salary, or
any contribution to or supplementation of salary from any
source other than the State for services provided by the member
or alternate to the Authority.
Paragraph (4). This paragraph provides that in general, no
person detailed to serve the Authority under subsection (e)(6)
shall receive any salary or any contribution to or
supplementation of salary for services provided to the
Authority from any source other than the State, local, or
intergovernmental department or agency from which the person
was detailed, or the Authority. Any person that violates this
paragraph shall be fined not more than $5,000, imprisoned not
more than one year, or both. The Federal cochairperson, the
alternate Federal cochairperson, and any Federal officer or
employee detailed to duty on the Authority under subsection
(e)(5) will not be subject to this paragraph, but will remain
subject to sections 202 through 209 of title 18, United States
Code.
Paragraph (5). This paragraph provides that in general, the
Authority may appoint and fix the compensation of an executive
director and such other personnel as are necessary to enable
the Authority to carry out the duties of the Authority.
Compensation under this paragraph cannot exceed the maximum
rate for the Senior Executive Service under section 5382 of
title 5, United States Code, including any applicable locality-
based comparability payment that may be authorized under
section 5304(h)(2)(C) of that title. The executive director
will be responsible for carrying out the administrative duties
of the Authority, direction of the Authority staff, and such
other duties as the Authority may assign. No member, alternate,
officer, or employee of the Authority (except the Federal
cochairperson of the Authority, the alternate and staff for the
Federal cochairperson, and any Federal employee detailed to the
Authority under subsection (e)(5)) will be considered to be a
Federal employee for any purpose.
Subsection (i). Conflicts of Interest:
Paragraph (1). This paragraph provides that in general,
except as provided under paragraph (2), no State member,
alternate, officer, or employee of the Authority will
participate personally and substantially as a member,
alternate, officer, or employee of the Authority in any
proceeding, application, request for a ruling or other
determination, contract, claim, controversy, or other matter in
which, to knowledge of the member, alternate, officer, or
employee, he or she--or his or her spouse, minor child,
partner, or organization (other than a State or political
subdivision of the State) in which he or she is serving as
officer, director, trustee, partner, or employee, or any person
or organization with whom he or she is negotiating or has any
arrangement concerning prospective employment, has a financial
interest.
Paragraph (2). This paragraph provides that Paragraph (1)
will not apply if the State member, alternate, officer, or
employee (A) immediately advises the Authority of the nature
and circumstances of the proceeding, application, request for a
ruling or other determination, contract, claim, controversy, or
other particular matter presenting a potential conflict of
interest; (B) makes full disclosure of the financial interest;
and (C) before the proceeding concerning the matter presenting
the conflict of interest, receives a written determination by
the Authority that the interest is not so substantial as to be
likely to affect the integrity of the services that the
Authority may expect from the State member, alternate, officer,
or employee.
Paragraph (3). This paragraph provides that any person that
violates this subsection shall be fined not more than $10,000,
imprisoned not more than two years, or both.
Subsection (j). This subsection provides that the Authority
may declare void any contract, loan, or grant of or by the
Authority in relation to which the Authority determines that
there has been a violation of any provision under subsection
(h)(4), subsection (i), or sections 202 through 209 of title
18, United States Code.
Section 387C. Economic and Community Development Grants
Subsection (a). This subsection provides that the Authority
may approve grants to States, localgovernments, and public and
nonprofit organizations for projects, approved in accordance with
section 387I (1) to develop the transportation and telecommunication
infrastructure of the region for the purpose of facilitating economic
development in the region (except that grants for this purpose may only
be made to States, local governments, and nonprofit organizations); (2)
to assist the region in obtaining the job training, employment-related
education, and business development (with an emphasis on
entrepreneurship) that are needed to build and maintain strong local
economies; (3) to provide assistance to severely distressed and
underdeveloped areas that lack financial resources for improving basic
public services; (4) to provide assistance to severely distressed and
underdeveloped areas that lack financial resources for equipping
industrial parks and related facilities; and (5) to otherwise achieve
the purposes of this subtitle.
Subsection (b). This subsection provides that funds for
grants under subsection (a) may be provided (A) entirely from
appropriations to carry out this section; (B) in combination
with funds available under another Federal or Federal grant
program; or (C) from any other source. To best build the
foundations for long-term economic development and to
complement other Federal and State resources in the region,
Federal funds available under this subtitle will be focused on
the activities in the following order of priority: (A) basic
public infrastructure in distressed counties and isolated areas
of distress; (B) transportation and telecommunication
infrastructure for the purpose of facilitating economic
development in the region; (C) business development, with
emphasis on entrepreneurship; and (D) job training or
employment-related education, with emphasis on use of existing
public educational institutions located in the region.
Funds appropriated to carry out this section may be used to
increase a Federal share in a grant program, as the Authority
determines appropriate.
Section 387D. Supplements to Federal Grant Programs
Subsection (a). This subsection states that Congress finds
that certain States and local communities of the region,
including local development districts, may be unable to take
maximum advantage of Federal grant programs for which the
States and communities are eligible because (1) they lack the
economic resources to meet the required matching share; or (2)
there are insufficient funds available under the applicable
Federal grant law authorizing the program to meet pressing
needs of the region.
Subsection (b). This subsection provides that in accordance
with subsection (c), the Federal cochairperson may use amounts
made available to carry out this subtitle, without regard to
any limitations on areas eligible for assistance or
authorizations for appropriation under any other Act, to fund
all or any portion of the basic Federal contribution to a
project or activity under a Federal grant program in the region
in an amount that is above the fixed maximum portion of the
cost of the project otherwise authorized by applicable law, but
not to exceed 90 percent of the costs of the project (except as
provided in section 387F(b)).
Subsection (c). Certification:
Paragraph (1). This paragraph provides that in general, in
the case of any program or project for which all or any portion
of the basic Federal contribution to the project under a
Federal grant program is proposed to be made under this
section, no Federal contribution will be made until the Federal
official administering the Federal law authorizing the
contribution certifies that the program or project meets the
applicable requirements of the applicable Federal grant law,
and could be approved for Federal contribution under the law if
funds were available under the law for the program or project.
Paragraph (2). This paragraph provides that in general, the
certifications and determinations required to be made by the
Authority for approval of projects under this subtitle in
accordance with section 387I will be controlling and will be
accepted by the Federal agencies. Any finding, report,
certification, or documentation required to be submitted to the
head of the department, agency, or instrumentality of the
Federal Government responsible for the administration of any
Federal grant program shall be accepted by the Federal
cochairperson with respect to a supplemental grant for any
project under the program.
Section 387E. Local Development Districts; Certification and
Administrative Expenses
Subsection (a). This subsection defines the term ``local
development district.''
Subsection (b). This subsection provides that the Authority
may make grants for administrative expenses under this section.
The amount of any grant cannot exceed 80 percent of the
administrative expenses of the local development district
receiving the grant. No grant will be awarded to a State agency
certified as a local development district for a period greater
than three years. The contributions of a local development
district for administrative expenses may be in cash or in kind,
fairly evaluated, including space, equipment, and services.
Subsection (c). This subsection provides that a local
development district will (1) operate as a lead organization
serving multi-county areas in the region at the local level;
and (2) serve as a liaison between State and local governments,
nonprofit organizations (including community-based groups and
educational institutions), the business community, and citizens
that are involved in multi-jurisdictional planning, provide
technical assistance to local jurisdictions and potential
grantees, and provide leadership and civic development
assistance.
Section 387F. Distressed Counties and Areas and Nondistressed Counties
Subsection (a). This subsection provides that not later
than 90 days after the date of enactment of this subtitle, and
annually thereafter, the Authority, in accordance with such
criteria as the Authority may establish, must designate (1) as
distressed counties, counties in the region that are the most
severely and persistently distressed and underdeveloped and
have high rates of poverty, unemployment, or outmigration; (2)
as nondistressed counties, counties in the region that are not
designated as distressed counties under paragraph (1); and (3)
as isolated areas of distress, areas located in nondistressed
counties (as designated under paragraph (2)) that have high
rates of poverty, unemployment, or outmigration.
Subsection (b). This subsection provides that the Authority
will allocate at least 75 percent of the appropriations made
available under section 387M for programs and projects designed
to serve the needs of distressed counties and isolated areas of
distress in the region. The funding limitations under section
387D(b) shall not apply to a project providing transportation
or telecommunication or basic public services to residents of
one or more distressed counties or isolated areas of distress
in the region.
Subsection (c). This subsection provides that in general,
except as provided in this subsection, no funds shall be
provided under this subtitle for a project located in a county
designated as a nondistressed county under subsection (a)(2).
The funding prohibition under this subsection shall not apply
to grants to fund the administrative expenses of local
development districts under section 387E(b). The Authority may
waive the application of the funding prohibition under
paragraph (1) of this subsection to a multicounty project that
includes participation by a nondistressed county, or to any
other type of project, if the Authority determines that the
project could bring significant benefits to areas of the region
outside a nondistressed county. For a designation of an
isolated area of distress for assistance to be effective, the
designation shall be supported by the most recent Federal data
available, or if no recent Federal data are available, by the
most recent data available through the government of the State
in which the isolated area of distress is located.
Subsection (d). This subsection provides that the Authority
will allocate at least 50 percent of any funds made available
under section 387M for transportation, telecommunication, and
basic public infrastructure projects authorized under
paragraphs (1) and (3) of section 387C(a).
Section 387G. Development Planning Process
Subsection (a). This subsection provides that in accordance
with policies established by the Authority, each State member
must submit a development plan for the area of the region
represented by the State member.
Subsection (b). This subsection provides that a State
development plan submitted under subsection (a) shall reflect
the goals, objectives, and priorities identified in the
regional development plan developed under section 387B(d)(2).
Subsection (c). This subsection provides that in carrying
out the development planning process (including the selection
of programs and projects for assistance), a State may consult
with local development districts and local units of government,
and may take into consideration the goals, objectives,
priorities, and recommendations of these entities.
Subsection (d). This subsection provides that in general,
the Authority and applicable State and local development
districts will encourage and assist, to the maximum extent
practicable, public participation in the development, revision,
and implementation of all plans and programs under this
subtitle. The Authority shall develop guidelines for providing
public participation, including public hearings.
Section 387H. Program Development Criteria
Subsection (a). This subsection provides that in general,
in considering programs and projects to be provided assistance
under this subtitle, and in establishing a priority ranking of
the requests for assistance provided by the Authority, the
Authority will follow procedures that ensure, to the maximum
extent practicable, consideration of (1) the relationship of
the project or class of projects to overall regional
development; (2) the per capita income and poverty and
unemployment and outmigration rates in an area; (3) the
financial resources available to the applicants for assistance
seeking to carry out the project, with emphasis on ensuring
that projects are adequately financed to maximize the
probability of successful economic development; (4) the
importance of the project or class of projects in relation to
other projects or classes of projects that may be in
competition for the same funds; (5) the prospects that the
project for which assistance is sought will improve, on a
continuing rather than a temporary basis, the opportunities for
employment, the average level of income, or the economic
development of the area served by the project; and (6) the
extent to which the project design provides for detailed
outcome measurements by which grant expenditures and the
results of the expenditures may be evaluated.
Subsection (b). This subsection provides that no financial
assistance authorized by this subtitle will be used to assist a
person or entity in relocating from one area to another, except
that financial assistance may be used as otherwise authorized
by this title to attract businesses from outside the region to
the region.
Subsection (c). This subsection provides that funds may be
provided for a program or project in a State under this
subtitle only if the Authority determines that the level of
Federal or State financial assistance provided under a law
other than this subtitle, for the same type of program or
project in the same area of the State within the region, will
not be reduced as a result of funds made available by this
subtitle.
Section 387I. Approval of Development Plans and Projects
Subsection (a). This subsection provides that in general, a
State or regional development plan or any multi-state
subregional plan that is proposed for development under this
subtitle will be reviewed by the Authority.
Subsection (b). This subsection provides that an
application for a grant or any other assistance for a project
under this subtitle will be made through and evaluated for
approval by the State member of the Authority representing the
applicant.
Subsection (c). This subsection provides that an
application for a grant or other assistance for a project must
be approved only on certification by the State member that the
application for the project (1) describes ways in which the
project complies with any applicable State development plan;
(2) meets applicable criteria under section 387H; (3) provides
adequate assurance that the proposed project will be properly
administered, operated, and maintained; and (4) otherwise meets
the requirements of this subtitle.
Subsection (d). This subsection provides that on
certification by a State member of the Authority of an
application for a grant or other assistance for a specific
project under this section, an affirmative vote of the
Authority under section 387B(c) will be required for approval
of the application.
Section 387J. Consent of States
This section provides that nothing in this subtitle
requires any State to engage in or accept any program under
this subtitle without the consent of the State.
Section 387K. Records
Subsection (a). This subsection provides that in general,
the Authority will maintain accurate and complete records of
all transactions and activities of the Authority. All records
of the Authority willbe available for audit and examination by
the Comptroller General of the United States and the Inspector General
of the Department of Agriculture (including authorized representatives
of the Comptroller General and the Inspector General of the Department
of Agriculture).
Subsection (b). This subsection provides that in general, a
recipient of Federal funds under this subtitle will, as
required by the Authority, maintain accurate and complete
records of transactions and activities financed with Federal
funds and report on the transactions and activities to the
Authority. All records will be available for audit by the
Comptroller General of the United States, the Inspector General
of the Department of Agriculture, and the Authority (including
authorized representatives of the Comptroller General, the
Inspector General of the Department of Agriculture, and the
Authority).
Subsection (c). This subsection provides that the Inspector
General of the Department of Agriculture will audit the
activities, transactions, and records of the Authority on an
annual basis.
Section 387L. Annual Report
This section provides that not later than 180 days after
the end of each fiscal year, the Authority shall submit to the
President and to Congress a report describing the activities
carried out under this subtitle.
Section 387M. Authorization of Appropriations
This section authorizes the appropriation to the Authority
to carry out this subtitle $30,000,000 for each of fiscal years
2002 through 2006, to remain available until expended. Not more
than 5 percent of the amount appropriated for a fiscal year
will be used for administrative expenses of the Authority.
Notwithstanding any other provision of this subtitle, for any
fiscal year, the aggregate amount of grants received by a State
and all persons or entities in the State under this subtitle
shall be not less than \1/3\ of the product obtained by
multiplying the aggregate amount of grants under this subtitle
for the fiscal year by the ratio that the population of the
State bears to the population of the region
Section 387N. Termination of Authority
This section provides that this subtitle and the authority
provided under this subtitle expire on October 1, 2006.
Subtitle D--Food, Agriculture, Conservation, and Trade Act of 1990
Section 651. Alternative Agricultural Research and Commercialization
Corporation
Subsection (a). This subsection provides that Subtitle G of
title XVI of the Food, Agriculture, Conservation, and Trade Act
of 1990 (7 U.S.C. 5901 et seq.) is repealed.
Subsection (b). This subsection provides for the
disposition of assets of the Alternative Agricultural Research
and Commercialization Corporation (referred to in this section
as the ``Corporation''), including the funds in the Alternative
Agricultural Research and Commercialization Revolving Fund as
of the date of enactment of this Act, are transferred to the
Secretary of Agriculture.
Subsection (c). This subsection provides that funds
transferred under subsection (b), and any income from assets or
proceeds from the sale of assets transferred under subsection
(b), will be deposited into an account in the Treasury, and
will remain available to the Secretary until expended, without
further appropriation, to pay any outstanding claims or
obligations of the Corporation and the costs incurred by the
Secretary in carrying out this section. On final disposition of
all assets transferred under subsection (b), any funds
remaining in the account will be transferred into miscellaneous
receipts in the Treasury.
Subsection (d). This subsection makes conforming amendments
consistent with this section.
Section 652. Telemedicine and Distance Learning Services in Rural Areas
This section amends Section 2335A of the Food, Agriculture,
Conservation, and Trade Act of 1990 by extending it to 2006.
Subtitle E--Rural Electrification Act of 1936
Section 661. Bioenergy and Biochemical Projects
This section amends Title I of the Rural Electrification
Act of 1936 (7 U.S.C. 901 et seq.) by adding at the end a new
Section 20 that provides that in carrying out rural electric
loan, loan guarantee, and grant programs under this Act, the
Secretary must provide a priority for bioenergy and biochemical
projects.
Section 662. Guarantees for bonds and notes issued for electrification
or telephone purposes
This section provides that the Rural Electrification Act of
1936 is amended by inserting after section 313 (7 U.S.C. 940c)
a new section 313A containing the following subsections:
Subsection (a). This subsection provides that the Secretary
will guarantee payments on bonds or notes issued by cooperative
or other lenders organized on a not-for-profit basis if the
proceeds of the bonds or notes are used for electrification or
telephone projects eligible for assistance under this Act,
including the refinancing of bonds or notes issued for such
projects.
Subsection (b). Limitations:
Paragraph (1). This paragraph provides that a lender will
not receive a guarantee under this section for a bond or note
if, at the time of the guarantee, the total principal amount of
such guaranteed bonds or notes outstanding of the lender would
exceed the principal amount of outstanding loans of the lender
for electrification or telephone purposes that have been made
concurrently with loans approved for such purposes under this
Act.
Paragraph (2). This paragraph provides that the Secretary
will not guarantee payment on a bond or note issued by a
lender, the proceeds of which are used for the generation of
electricity.
Paragraph (3). This paragraph provides that the Secretary
may deny the request of a lender for the guarantee of a bond or
note under this section if the Secretary determines that (A)
the lender does not have appropriate expertise or experience or
is otherwise not qualified to make loans for electrification or
telephone purposes; (B) the bond or note issued by the lender
is not of reasonable and sufficient quality; or (C) the lender
has not provided sufficient evidence that the proceeds of the
bond or note are used for eligible projects described in
subsection (a).
Paragraph (4). This paragraph provides that a lender may
not use any amount obtained from the reduction in funding costs
as a result of the guarantee of a bond or note under this
section to reduce the interest rate on a new or outstanding
loan, except a lender may use such an amount to reduce the
interest rate on a loan if the loan is made by the lender for
electrification or telephone projects that are eligible for
assistance under this Act and is made concurrently with a loan
approved by the Secretary under this Act for such a project, as
provided in section 307.
Subsection (c). This subsection provides that in general, a
lender that receives a guarantee issued under this section on a
bond or note will pay a fee to the Secretary. The amount of an
annual fee paid for the guarantee of a bond or note under this
section will be equal to 30 basis points of the amount of the
unpaid principal of the bond or note guaranteed under this
section. A lender will pay the fees required under this
subsection on a semiannual basis. Subject to subsection (e),
fees collected under this subsection will be deposited into the
rural economic development subaccount maintained under section
313(b)(2)(A), to remain available until expended, and will be
used for the purposes described in section 313(b)(2)(B).
Subsection (d). This subsection provides that a guarantee
issued under this section will be for the full amount of a bond
or note, including the amount of principal, interest, and call
premiums, will be fully assignable and transferable, and will
represent the full faith and credit of the United States. To
ensure that the Secretary has the resources necessary to
properly examine the proposed guarantees, the Secretary may
limit the number of guarantees issued under this section if the
number of such guarantees exceeds 5 per year. On the timely
request of an eligible lender, the General Counsel of the
Department of Agriculture will provide the Secretary with an
opinion regarding the validity and authority of a guarantee
issued to the lender under this section.
Subsection (e). This subsection authorizes appropriations
of such sums as are necessary to carry out this section. To the
extent that the amount of funds appropriated for a fiscal year
under paragraph (1) are not sufficient to carry out this
section, the Secretary may use up to 1/3 of the fees collected
under subsection (c) for the cost of providing guarantees of
bonds and notes under this section before depositing the
remainder of the fees into the rural economic development
subaccount maintained under section 313(b)(2)(A).
Subsection (f). This subsection provides that the authority
provided under this section will terminate on September 30,
2006.
This section also provides that Section 313(b)(2)(B) of the
Rural Electrification Act of 1936 (7 U.S.C. 940c)(b)(2)(B)) is
amended by requiring the Secretary to act through the Rural
Utilities Service. Not later than 180 days after the date of
enactment of this Act, the Secretary of Agriculture will
promulgate regulations to carry out the amendments made by this
section, and not later than 240 days after the date of
enactment of this Act, the Secretary will implement the
amendment made by this section.
Section 663. Expansion of 911 access
This section amends Title III of the Rural Electrification
Act of 1936 (7 U.S.C. 931 et seq.) by adding a new Section 315
containing the following subsections:
Subsection (a). This subsection provides that the Secretary
may make telephone loans under this title to State or local
governments, Indian tribes, or other public entities for
facilities and equipment to expand 911 access in underserved
rural areas.
Subsection (b). This subsection authorizes appropriations
of such sums as are necessary to carry out this section.
TITLE VII--RESEARCH
Subtitle A--National Agricultural Research, Extension, and Teaching
Policy Act of 1977
Section 701. Definitions
This section amends the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 to define the term
``insular area'' to mean the Commonwealth of Puerto Rico, Guam,
American Samoa, the Commonwealth of the Northern Mariana
Islands, the Federated States of Micronesia, the Republic of
the Marshall Islands, the Republic of Palau, and the Virgin
Islands of the United States; and the term ``State'' to mean
any of the States, the District of Columbia, and any insular
area.
Section 702. National Agricultural Research, Extension, Education, and
Economics Advisory Board
This section reauthorizes the Advisory Board through 2006.
Section 703. Grants and fellowships for food and agricultural sciences
education
This section reauthorizes this program through 2006, and
expands it to include grants and fellowships for academic
degrees related to rural economic, community, and business
development. The Committee wishes to clarify that the existing
language of this section authorizes support of students seeking
to obtain academic degrees related to extension teaching.
Section 704. Competitive Research Facilities Grant Program
This section amends the National Agricultural Research,
Extension, and Teaching Policy Act of 1997 to create a
competitive grants program for the construction, acquisition,
modernization, renovation, alteration, and remodeling of food
and agricultural research facilities.
Subsection (a) provides that the Secretary will award
grants to eligible institutions on a competitive basis for the
construction, acquisition, modernization, renovation,
alteration, and remodeling of food and agricultural research
facilities such as buildings, laboratories, and other capital
facilities (including acquisition of fixtures and equipment).
Subsection (b) provides that all state cooperative
institutions (which includes 1862 land grant institutions, 1890
land grant institutions, 1994 land grant institutions, and
McIntire-Stennis schools) and Hispanic serving institutions are
eligible for the grants.
Subsection (c) provides the Secretary discretion to
determine the criteria for awarding grants.
Subsection (d) provides the Secretary discretion to
determine an appropriate matching requirement.
Subsection (e) directs the Secretary to target grants to
particular institutions to enhance their capacity to do
research.
Subsection (f) directs the Secretary to promulgate
appropriate regulations, and to ensure that states have a
coordinated intrastate program.
Subsection (g) exempts program advisory committees from the
Federal Advisory Committee Act.
Subsection (h) directs the Secretary to consult with the
Advisory Board.
Subsection (i) authorizes appropriations of such sums as
are necessary.
Section 705. Grants for research on the production and marketing of
alcohols and industrial hydrocarbons from agricultural
commodities and forest products
This section reauthorizes this program through 2006.
Section 706. Policy research centers
This section reauthorizes this program through 2006.
Section 707. Human nutrition intervention and health promotion research
program
This section reauthorizes this program through 2006.
Section 708. Pilot research program to combine medical and agricultural
research
This section reauthorizes this program through 2006.
Section 709. Nutrition education program
This section reauthorizes this program through 2006.
Section 710. Animal health and disease research programs
This section reauthorizes this program through 2006.
Section 711. Research on national or regional problems
This section reauthorizes this program through 2006.
Section 712. Education grants for programs for Hispanic-serving
institutions
This section reauthorizes this program through 2006.
Section 713. Competitive grants for international agricultural science
and education programs
This section reauthorizes this program through 2006.
Section 714. Indirect costs
This section amends the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 to increase the
indirect cost cap from 19 percent to the indirect cost rate
established for an institution by its cognizant Federal audit
agency, except for certain awards granted through the Small
Business Act.
Section 715. Research equipment grants
This section amends the National Agricultural Research,
Extension, and Teaching Policy Act of 1977.
Subsection (a) allows the Secretary to make competitive
grants for the acquisition of special purpose scientific
research equipment for use in the food and agricultural
sciences programs of eligible institutions.
Subsection (b) defines an eligible institution as a college
or university or a State cooperative institution.
Subsection (c) limits an award under this section to not
more than $500,000.
Subsection (d) limits recouping of expenses from awards
under this section as indirect costs under other federal grants
or programs.
Subsection (f) authorizes appropriations for this program
at $50,000,000 for each of fiscal years 2002 through 2006.
Section 716. Agricultural research programs
The National Agricultural Research, Extension, and Teaching
Policy Act of 1977 is amended to increase the general
authorizations for agricultural research from $850 million to
$1.5 billion for 2002 to 2006.
Section 717. Extension education
The National Agricultural Research, Extension, and Teaching
Policy Act of 1977 is amended by changing the authorization
level for Extension Education from $420,000,000 to $500,000,000
for 2002 to 2006.
Section 718. Availability of competitive grant funds
The National Agricultural Research, Extension, and Teaching
Policy Act of 1977 is amended to provide that funds for
competitive agricultural research, education, or extension
grant programs, under this or any other Act, shall remain
available for obligation for a two-year period beginning on
October 1 of the fiscal year for which the funds are made
available.
Section 719. Joint requests for proposal
The National Agricultural Research, Extension, and Teaching
Policy Act of 1977 is amended to facilitate joint requests for
proposals (RFP).
Subsection (a) expressly provides USDA with authority to
issue joint RFPs with other agencies (such as the National
Science Foundation, Environmental Protection Agency, U.S.
Agency for International Development, and National Air and
Space Administration) to eliminate duplication of research,
review, and evaluation resources.
Subsection (b) allows the Secretary to transfer funds to
cooperating agencies subject to applicable laws.
Subsection (c) allows the Secretary to delegate her
authority to an appropriate coordinating agency.
Subsection (d) provides the Secretary with authority to
coordinate regulations and indirect rates with a cooperating
agency.
Subsection (e) allows joint peer review panels to be
established.
Section 720. Supplemental and alternative crops
This section reauthorizes this program through 2006.
Section 721. Aquaculture
This section reauthorizes this program through 2006.
Section 722. Rangeland research
This section reauthorizes this program through 2006.
Section 723. Biosecurity Planning and Response Programs
Subsection (a) amends the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 to create a new
subtitle on biosecurity.
CHAPTER 1--AGRICULTURE INFRASTRUCTURE SECURITY
Section 1484 defines terms as used in the subtitle,
including agricultural research facility.
Section 1485. Agriculture Infrastructure Security Fund
Subsections (a)-(c) establish an Agriculture Infrastructure
Security Fund that provides funding to protect and strengthen
the Federal food safety and agricultural infrastructure. Such
sums as are necessary are authorized to be appropriated for
each of fiscal years 2002 through 2006. The Secretary is also
authorized to accept contributions and other proceeds in the
Fund as outlined in this section. All funds are available until
expended.
Subsection (d) provides that on request by the Secretary,
the Secretary of the Treasury shall transfer from the Fund to
the Secretary, and the Secretary shall accept and use without
further appropriation, such amounts as the Secretary determines
to be necessary to pay the following:
Paragraph (A) provides for the costs of planning, design,
development, construction, acquisition, modernization, leasing,
and disposal of facilities, equipment, and technology used by
the Department in carrying out programs relating to the
purposes specified in this section.
Paragraph (B) provides for the costs of specialized
services relating to the purposes specified in this section.
Paragraph (C) provides for the costs of cooperative
arrangements authorized to be entered into with State, local
and tribal governments, and other public and private entities,
to carry out programs relating to the purposes specified in
this section.
Paragraph (D) provides for administrative costs incurred in
carrying out this section.
Subsection (e) provides that the Secretary by sale may
dispose of all or any part of any right or title in land
(excluding National Forest System land), facilities, or
equipment in the full control of the Department (including land
and facilities at the Beltsville Agricultural Research Center).
Proceeds from the sale are deposited in the Fund established
under this section.
Subsection (f) provides that the Secretary may accept gifts
and bequests of funds, property (real, personal, and
intangible), equipment, services, and other in-kind
contributions from State, local, and tribal governments,
colleges and universities, individuals, and other public and
private entities subject to the conflict-of-interest
limitations set out in this subsection.
Section 1486. Agriculture Infrastructure Security Commission
Subsection (a) provides that the Secretary shall establish
a commission to be known as the Agriculture Infrastructure
Security Commission.
Subsection (b) provides the Commission shall be comprised
of 15 voting members, appointed by the Secretary based on
nominations solicited from the public. Commission members shall
represent a balance of the public and private sectors; and have
combined expertise in facilities development, modernization,
construction, security, consolidation, and closure; plant
diseases and pests; animal diseases and pests; food safety;
biosecurity; the needs of farmers and ranchers; public health;
State, local, and tribal government; and any other area related
to agriculture infrastructure security, as determined by the
Secretary.
The following non-voting members shall serve on the
Commission: the Secretary; four representatives appointed by
the Secretary of Health and Human Services from the Public
Health Service, the National Institutes of Health, the Centers
for Disease Control and Prevention, and the Food and Drug
Administration; one representative appointed by the Attorney
General; one representative appointed by the Director of
Homeland Security; and not more than four representatives of
the Department appointed by the Secretary.
Subsection (c) provides that the term of office of a member
of the Commission shall be 4 years except that initial terms
shall be staggered.
Subsection (d) provides for the requirements for meetings
of the Commission, applicability of the Federal Advisory
Committee Act, and records requirements.
Subsection (e) provides that the Secretary shall appoint
the Chair from among the voting members of the Commission.
Subsection (f). Duties:
Paragraph (1) provides that the Commission shall advise the
Secretary on the uses of the Fund; review all agricultural
research facilities for research importance, and importance to
agriculture infrastructure security; identify any agricultural
research facility that should be closed, realigned,
consolidated, or modernized to carry out the research agenda of
the Secretary and protect agriculture infrastructure security;
develop recommendations concerning agricultural research
facilities; and evaluate the agricultural research facilities
acquisition and modernization system.
Paragraph (2) provides that to assist the Commission in
carrying out the duties described in paragraph (1), the
Commission shall use the 10-year strategic plan prepared by the
Strategic Planning Task Force established under section 4 of
the Research Facilities Act.
Paragraph (3) requires the Commission to submit an annual
report to the Secretary, the Committee on Agriculture and the
Committee on Appropriations of the House of Representatives,
and the Committee on Agriculture, Nutrition, and Forestry and
the Committee on Appropriations of the Senate. Not later than
90 days after the date of receipt of this report, the Secretary
shall provide to the Commission a written response concerning
the manner and extent to which the Secretary will implement the
recommendations in the report. This report shall be publicly
available subject to the limitation set forth in this
paragraph.
Subsection (g) provides for the compensation of commission
members.
Subsection (h) authorizes the appropriation of such sums as
are necessary for 2002 through 2006.
CHAPTER 2.--OTHER BIOSECURITY PROGRAMS
Section 1487. Special authorization for biosecurity planning and
response
This section amends the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 to create a special
account for appropriations for agricultural research,
education, and extension activities for biosecurity planning
and response.
Subsection (a) authorizes such sums as are necessary for
fiscal years 2002 through 2006 to be appropriated.
Subsection (b) provides that funds provided under this
section may be used under any authority available to the
Secretary in order to reduce the vulnerability of the U.S. food
and agricultural system to chemical or biological attack, to
counter any such chemical or biological attack, or to respond
to any such chemical or biological attack.
Section 1488. Agricultural Bioterrorism Research Facilities
Subsection (a) defines terms used in this section including
definitions of construction, cost, and eligible entities.
Subsection (b) provides that to enhance the security of
agriculture in the United States against threats posed by
bioterrorism, the Secretary shall make construction grants, on
a competitive basis, to eligible entities subject to a
limitation of $10,000,000 in any one fiscal year.
Subsection (c) sets forth the requirements for grants.
Subsection (d) provides the Secretary discretion in
determining the amount of grant awards.
Subsection (e) requires that the Federal share of the cost
of any construction carried out using funds from a grant
provided under this section shall not exceed 50 percent.
Subsection (f) provides that not later than 180 days after
the date of enactment of this subtitle, the Secretary shall
issue guidelines with respect to the provision of grants under
this section.
Subsection (g) provides for an authorization of
appropriations for $100,000,000 for fiscal years 2003 through
2005.
Subsection (b) provides a sense of Congress provision that
funding for the Agricultural Research Service, the Animal and
Plant Health Inspection Service, and other agencies of the
Department of Agriculture with responsibilities for biosecurity
should be increased as necessary to improve the capacity of the
agencies to conduct research and analysis of, and respond to,
bioterrorism and animal and plant diseases.
Subtitle B--Food, Agriculture, Conservation, and Trade Act of 1990
Section 731. National genetic resources program
This section reauthorizes this program through 2006.
Section 732. Biotechnology Risk Assessment Research
This section reauthorizes this program through 2006, and
amends the Food, Agriculture, Conservation, and Trade Act of
1990 to create priority for grants to institutions that have
the goals of forming interdisciplinary teams to review or
conduct research, conducting studies on the biosafety of
genetically modified agricultural products, evaluating of
identity preservation systems, establishing international
partnerships, or reviewing the nutritional enhancement and
environmental effects of genetically modified agricultural
products.
Section 733. High-priority research and extension initiatives
This section reauthorizes this program through 2006, and
amends the Food, Agriculture, Conservation, and Trade Act of
1990 to create research initiatives for: Animal infectious
diseases and biosecurity, childhood obesity, integrated pest
management, and beef cattle genetics.
Section 734. Nutrient management research and extension initiative
This section reauthorizes this program through 2006.
Section 735. Organic agriculture research and extension initiative
This section reauthorizes this program through 2006, and
expands the authorization for organic research to cover use of
genomics to improve organic agriculture and to address concerns
about the potential impact of genetically modified organisms on
organic agriculture.
Section 736. Agricultural telecommunications program
This section reauthorizes this program through 2006.
Section 737. Assistive technology program for farmers with disabilities
This section reauthorizes this program through 2006.
Subtitle C.--Agricultural, Research, Extension, and Education Reform
Act of 1998
Section 741. Initiative for Future Agriculture and Food Systems
This section amends section 401(b) of the Act to preserve,
continue, and expand funding for this program through 2006.
New subparagraph (1)(A) of section 401(b) preserves the
current fiscal year allocations of funding under the existing
section 401(b)(1) by re-enacting language requiring the
Secretary of Treasury to transfer to the Initiative Account
$120,000,000 for each fiscal year through fiscal year 2002.
New subparagraph (1)(B) of section 401(b) requires the
Secretary of Treasury to transfer to the Initiative Account
$145,000,000 for each of fiscal years 2003 through 2006.
New paragraph (2) provides that the Secretary of
Agriculture shall receive, accept, and use the funds in the
Account, without further appropriation. Existing law provides
that the funds required to be transferred by the Secretary of
the Treasury for each fiscal year under section 401(b) shall
remain available for two fiscal years.
Section 742. Partnerships for high-value agricultural product quality
research
This section reauthorizes this program through 2006.
Section 743. Precision agriculture
This section reauthorizes this program through 2006.
Section 744. Biobased products
This section reauthorizes this program through 2006.
Section 745. Thomas Jefferson initiative for crop diversification
This section reauthorizes this program through 2006.
Section 746. Integrated research, education, and extension competitive
grants program
This section reauthorizes this program through 2006.
Section 747. Support for research regarding diseases of wheat and
barley caused by fusarium graminearum
This section reauthorizes this program through 2006.
Section 748. Office of pest management policy
This section reauthorizes this program through 2006.
Section 749. Senior Scientific Research Service
The Agricultural Research, Extension, and Education Reform
Act of 1998 is amended by adding a provision for a senior
scientific research service for USDA. This allows USDA to offer
outstanding researchers higher pay than they would be able to
receive under the general federal civil service scale, which
will help USDA stay competitive with other federal agencies and
the private sector.
Subsection (a) establishes the service.
Subsection (b) provides that the members of the service
shall have a doctoral degree and be outstanding in their field.
One hundred members are authorized and they are exempted from
many of the provisions applicable to civil service similar to
federal employees in the Senior Executive Service.
Subsection (c) directs the Secretary to establish a
performance appraisal system.
Subsection (d) provides that the rate of compensation for
members of the service shall not be less than the minimum GS-15
rate and not more than Level I of the Executive Schedule unless
approved by the President.
Subsection (e) provides that members of the service can
participate in the Federal Employees Retirement System.
Subtitle (f) addresses involuntary separation of members of
the service.
Subtitle D--Land-Grant Funding
CHAPTER 1--1862 INSTITUTIONS
Section 751. Carryover
Amends the Hatch Act of 1887 to allow the balance of any
annual funds provided under this Act to a State agricultural
experiment station for a fiscal year that remains unexpended at
the end of the fiscal year to be carried over for use during
the following fiscal year. If any of the unexpended balance
carried over by a State is not expended by the end of the
second fiscal year, an amount equal to the unexpended balance
shall be deducted from the next succeeding annual allotment to
the State.
Section 752. Reporting of technology transfer activities
Amends the Hatch Act of 1887 to require land grant
institutions to report on technology transfer activities.
Section 753. Compliance with multistate and integration requirements
Amends the Smith-Lever and Hatch Acts to require a State to
have spent on multistate extension activities and integrated
research and extension activities, from all sources of
cooperative extension and research funding (Federal, State, and
local), an amount equal to 25 percent of the Federal funds
provided to the State in the prior fiscal year, before
receiving its annual allocation of research or extension
funding.
Paragraph (1) defines multistate activity.
Paragraph (2) requires institutions to meet a requirement
that 25 percent of an institution's activities be multistate as
measured by Federal, State, and local funding.
Paragraph (3) provides the Secretary the authority to
reduce the percentage.
Paragraph (4) requires a plan of work from an institution
demonstrating how it will meet the goals of this section.
Paragraph (5) exempts Native American and territorial
institutions.
Subsection (b) amends the Hatch Act:
Paragraph (1) requires institutions to meet a requirement
that 25 percent of an institution's activities be integrated as
measured by Federal, State, and local funding.
Paragraph (2) provides the Secretary the authority to
reduce the percentage.
Paragraph (3) requires a plan of work from an institution
demonstrating how it will meet the goals of this section.
Paragraph (4) exempts Native American and territorial
institutions.
Paragraph (5) allows funds counted towards meeting the
multistate extension requirement to be counted towards meeting
the integrated activities requirement as well.
CHAPTER 2--1994 INSTITUTIONS
Section 754. Extension at 1994 institutions
Amends the Smith-Lever Act to make technical changes to the
extension program at Native American institutions.
Subparagraph (A) authorizes the appropriation of such sums
as are necessary to implement the section.
Subparagraph (B) directs the Secretary to establish a
formula for distributing funds among institutions.
Subparagraph (C) allows cooperative agreements among
classes of institutions.
Section 755. Equity in Educational Land-Grant Status Act of 1994
Amends the Equity in Educational Land-Grant Status Act of
1994.
Subsection (a) updates the names of 1994 institutions.
Subsection (b) requires 1994 institutions to be accredited
to receive research grants.
Subsection (c) authorizes appropriations of such sums as
are necessary for formula funds under this section.
Subsection (d) modifies the definition by which the full-
time equivalent Indian student count is calculated.
Subsection (e) increases the authorization for
institutional payments from $50,000 to $100,000 annually.
Subsection (f) reauthorizes institutional capacity building
grants through 2006, and authorizes the appropriation of such
sums as are necessary.
Subsection (g) reauthorizes research grants through 2006.
Section 756. Eligibility for integrated grants program
Amends the Agricultural Research, Extension, and Education
Reform Act of 1998 to allow 1994 institutions to participate in
the Integrated Grants Program.
CHAPTER 3--1890 INSTITUTIONS
Section 757. Authorization percentages for research and extension
formula fund
Subsection (a) amends the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 to increase the
authorization for extension formula funds for the 1890 land
grant institutions to an amount not less than 15 percent of
that appropriated for extension formula funds for the 1862
institutions under the Smith-Lever Act.
Subsection (b) amends the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 to increase the
formula percentage to 25 percent for 1890 institutions.
Section 758. Carryover
Amends the National Agricultural Research, Extension, and
Teaching Policy Act of 1977 to allow the carryover of the
balance of any annual funds provided to an eligible institution
for a fiscal year that remains unexpended at the end of the
fiscal year.
Subsection (a) provides the funds are available for use
during the following fiscal year.
Subsection (b) provides that any unexpended balance carried
over by an eligible institution that is not expended by the end
of the second fiscal year will be deducted from the next
succeeding annual allotment to the eligible institution.
Section 759. Reporting of technology transfer activities
Amends the National Agriculture Research, Extension, and
Teaching Policy Act of 1977 to require 1890 institutions to
report on their technology transfer activities.
Section 760. Grants to upgrade agricultural and food sciences
facilities at 1890 land-grant colleges, including Tuskegee
University
Amends the National Agricultural Research, Extension, and
Teaching Policy Act of 1977 to increase the grant authorization
level to $15,000,000 for 1996 to 2002 and $25,000,000 annually
for 2002 through 2006.
Section 761. National research and training centennial centers
This section reauthorizes this program through 2006.
Section 762. Matching funds requirement for research and extension
activities
Amends the National Agricultural Research, Extension, and
Teaching Policy Act of 1977 to ramp up the 1890 matching
requirement to 60 percent in 2003 and 110 percent of the prior
year's matching requirement from 2004 through 2006. The
Secretary has discretion to waive the match required above 50
percent under certain conditions.
CHAPTER 4--LAND-GRANT INSTITUTIONS
Subchapter A--General
Section 771. Priority setting process
Amends the Agricultural Research, Extension, and Education
Reform Act of 1998 to require USDA to establish minimum
stakeholder review requirements that ensure transparency and
opportunity for stakeholders to provide input.
Section 772. Termination of certain Schedule A appointments
Subsection (a) terminates 60 days after enactment of this
Act all Federal Schedule A civil service appointments for
extension workers at land-grant institutions who hold dual
Federal-State appointments.
Subsection (b) provides for continued eligibility of
terminated appointees for certain federal benefits subject to
limitations provided for in this subsection.
Subchapter B--Land-Grant Institutions in Insular Areas
Section 775. Distance education grants program for insular area land-
grant institutions
Amends the National Agricultural Research, Extension, and
Teaching Policy Act of 1977.
Subsection (a) authorizes a distance education program for
insular area land-grant institutions.
Subsection (b) provides that grants made under the program
can be used for a broad range of purposes necessary to
implementing the program.
Subsection (c) provides that funds shall not be used for
the planning, acquisition, construction, rehabilitation, or
repair of a building or facility.
Subsection (d) requires the Secretary to administer the
program in a manner that recognizes the needs of state
cooperative institutions.
Subsection (e) provides that the Secretary may establish a
matching funds requirement for funds from non-Federal sources
that is not less than 50 percent of the grant.
Subsection (f) authorizes appropriations of $4,000,000
annually for 2002 through 2006.
Section 776. Matching requirements for research and extension formula
funds for insular area land-grant institutions
Amends the Hatch Act of 1887 and the Smith-Lever Act to
create a 50 percent matching requirement for insular area land
grant institutions. The Secretary may waive the matching fund
requirement for any fiscal year if the Secretary determines
that the government of the insular area will be unlikely to
meet the matching requirement for the fiscal year.
Subtitle E--Other Laws
Section 781. Critical agricultural materials
This section reauthorizes this program through 2006.
Section 782. Research facilities
This section reauthorizes this program through 2006.
Section 783. Federal agricultural research facilities
This section reauthorizes this program through 2006.
Section 784. Competitive, special, and facilities research grants
The Competitive, Special, and Facilities Research Grant Act
(7 U.S.C. 450i) is amended to strike the statutorily set
research priorities in the National Research Initiative and
authorize the Secretary of Agriculture to set the priorities in
consultation with the Advisory Board and stakeholders.
Section 785. Risk management education for beginning farmers and
ranchers
Amends the Federal Crop Insurance Act to allow risk
management education grants targeted to beginning farmers.
Grants are for educating producers generally about the full
range of risk management activities, including futures,
options, agricultural trade options, crop insurance, cash
forward contracting, debt reduction, production
diversification, farm resources risk reduction, and other risk
management strategies.
Section 786. Aquaculture
This section reauthorizes this program through 2006.
Subtitle F--New Authorities
Section 791. Definitions
Defines terms used under this subtitle.
Section 792. Regulatory and inspection research
Allows the Secretary to utilize the best available sources
for meeting urgent research needs of USDA agencies.
Subsection (a) defines terms used under this section.
Subsection (b) requires the Secretary to consider the most
practicable public or private source that provides the most
timely and cost-effective research in meeting the needs of the
research and inspection agencies of the Department such as the
Food Safety and Inspection Service, Grain Inspection, Packers,
and Stockyards Administration, Animal and Plant Health
Inspection Administration, and Agricultural Marketing Service.
Subsection (c) requires the Secretary to establish
guidelines to prevent conflicts of interest.
Subsection (d) allows the Secretary to promulgate necessary
regulations.
Section 793. Emergency research transfer authority
Authorizes transfers between USDA appropriations to address
critical research needs. Transfers are subject to limitations
on the amount, demonstration of urgency, and approval by the
Office of Management and Budget.
Subsection (a) allows the Secretary to transfer up to 2
percent of any appropriation made available to an office or
agency of the Department for a fiscal year for agricultural
research, extension, marketing, animal and plant health,
nutrition, food safety, nutrition education, or forestry
programs to any other appropriation for an office or agency of
the Department for emergency research, extension, or education
activities needed to address imminent threats to animal and
plant health, food safety, or human nutrition, including
bioterrorism.
Subsection (b) provides that the Secretary may transfer
funds only on a determination by the Secretary that the need is
so imminent that the need will not be timely met by annual,
supplemental, or emergency appropriations. The total amount
transferred in a fiscal year cannot exceed $5,000,000, and must
be approved by the Director of the Office of Management and
Budget.
Section 794. Review of the Agricultural Research Service
Subsection (a) requires the Secretary to conduct a review
of the purpose, efficiency, effectiveness, and impact on
agricultural research of the Agricultural Research Service.
Subsection (b) requires the Secretary to use persons
outside the Department including Federal scientists, college
and university faculty, private and nonprofit scientists, or
other persons familiar with the Agricultural Research Service
and its role in conducting agricultural research in the United
States.
Subsection (c) requires a report due not later than
September 30, 2004.
Subsection (d) Provides that the Secretary shall use to
carry out this section not more than 0.1 percent of the amount
of appropriations made available to the Agricultural Research
Service for each of fiscal years 2002 through 2004.
Section 795. Technology transfer for rural development
Subsection (a) provides that the Secretary, acting through
the Rural Business-Cooperative Service and the Agricultural
Research Service, shall establish a program to promote the
availability of technology transfer opportunities of the
Department to rural businesses and residents.
Subsection (b) requires that, to the maximum extent
practicable, the program include a website featuring
information about the program and technology transfer
opportunities, an annual joint program for State economic
development directors and Department rural development
directors regarding technology transfer opportunities, and
available technology transfer opportunities programs.
Subsection (c) provides that the Secretary shall use funds
made available to the Agricultural Research Service and Rural
Business-Cooperative Service for salaries and expenses for the
program.
Section 796. Beginning farmer and rancher development program
Provides for the establishment of a beginning farmer and
rancher development program.
Subsection (a) defines terms used in this section.
Subsection (b) provides that the Secretary shall establish
a beginning farmer and rancher development program to foster
training, education, outreach, and technical assistance
initiatives for beginning farmers or ranchers.
Subsection (c). Grants:
Paragraph (1) provides competitive grants to eligible
institutions to support new and established local and regional
training, education, outreach, and technical assistance
initiatives for beginning farmers or ranchers.
Paragraph (2) provides that to be eligible to receive a
grant under this subsection, the recipient shall be a
collaborative State, local, or regionally-based network or
partnership of public or private entities, which may include a
State cooperative extension service, a Federal or State agency,
a community-based nongovernmental organization, a college or
university (including an institution awarding an associate
degree), or any other appropriate partner, as determined by the
Secretary.
Paragraph (3) provides that grants shall not exceed a term
of three years.
Paragraph (4) establishes a 25 percent matching requirement
for grantees.
Paragraph (5) requires not less than 25 percent of the
funds to be set aside to be used to support programs and
services that address the needs of limited resource and
socially disadvantaged beginning farmers or ranchers.
Paragraph (6) provides that a grant made under this
subsection may not be used for the planning, repair,
rehabilitation, acquisition, or construction of a building or
facility.
Paragraph (7) requires the Secretary to use not more than
four percent of the funds made available to carry out this
section for administrative costs incurred by the Secretary in
carrying out this section.
Subsection (d):
Paragraph (1) requires the Secretary to establish beginning
farmer and rancher education teams to develop curricula and
conduct educational programs and workshops for beginning
farmers or ranchers in diverse geographical areas of the United
States.
Paragraph (2) provides that in promoting the development of
curricula, the Secretary shall, to the maximum extent
practicable, include modules tailored to specific audiences of
beginning farmers or ranchers, based on crop or regional
diversity.
Paragraph (3) requires the Secretary, in establishing an
education team for a specific program or workshop, to the
maximum extent practicable, to obtain the short-term services
of specialists with knowledge and expertise in programs serving
beginning farmers or ranchers, and use officers and employees
of the Department with direct experience in programs of the
Department that may be taught as part of the curriculum for the
program or workshop.
Paragraph (4) requires the Secretary to cooperate, to the
maximum extent practicable, with State cooperative extension
services, Federal and State agencies, community-based and
nongovernmental organizations, colleges and universities
(including an institution awarding an associate's degree), or
foundations maintained by a college or university, and other
appropriate partners, as determined by the Secretary.
Subsection (e) requires the Secretary to establish an
online clearinghouse that makes available to beginning farmers
or ranchers education curricula and training materials and
programs.
Subsection (f) requires the Secretary to seek stakeholder
recommendations.
Subsection (g) provides that nothing in this section
prohibits the Secretary from allowing farmers and ranchers who
are not beginning farmers or ranchers from participating in
programs authorized under this section to the extent that the
Secretary determines that such participation is appropriate and
will not detract from the primary purpose of educating
beginning farmers and ranchers.
Subsection (h) provides that not later than 30 days after
the date of enactment of this Act, and on October 1, 2002, and
each October 1 thereafter through October 1, 2005, the
Secretary of the Treasury shall transfer $15,000,000, to remain
available for two years. It also allows the Secretary to charge
and collect fees.
Section 797. Sense of Congress regarding doubling of funding for
agricultural research and increasing capacity for research on
biosecurity and animal and plant health diseases
This section provides a sense of Congress provision that
federal investments in food and agricultural research should
double over the next five years.
Section 798. Rural Research
Subsection (a) establishes a Rural Research Fund Account in
the U.S. Treasury.
Subsection (b) provides that not later than 30 days after
the date of enactment of this Act, and on October 1, 2002, and
each October 1 thereafter through October 1, 2005, the
Secretary of the Treasury shall transfer $15,000,000, to remain
available for two years.
Subsection (c) requires the Secretary to use the funds in
the account to make competitive research grants for rural
policy research on topics such as: rural sociology, effects of
demographic change, needs of groups of rural citizens, rural
community development, rural infrastructure, rural business
development, rural education and extension programs, and rural
health.
Subsection (d) requires the Secretary in making grants
under this section, to solicit and consider public comment from
persons who conduct or use agricultural research, extension,
education, or rural development programs, and ensure that
funded proposals will provide high-quality research that may be
of use to public policymakers and private entities in making
decisions that affect development in rural areas.
Subsection (e) provides that eligible grantees are: an
individual; a college or university or a research foundation
maintained by a college or university; a State cooperative
institution; a community college; a nonprofit organization,
institution, or association; a business association; an agency
of a State, local, or tribal government; or a regional
partnership of public and private agencies.
Subsection (f) provides that a grant under this section
shall have a term that does not exceed five years.
Subsection (g) provides that the Secretary may require that
the grant funding be matched, in whole or in part, with
matching funds from a non-Federal source. The Secretary is
required to implement a 100 percent matching requirement for a
grant to a business association.
Subsection (h) provides that the Secretary may use not more
than four percent of the funds made available for grants under
this section to pay administrative costs incurred in carrying
out this section.
Section 798A. Priority for farmers and ranchers participating in
conservation programs
Requires the Secretary to give priority in carrying out the
programs or projects authorized under this act to using farms
or ranches of farmers or ranchers who participate in Federal
agricultural conservation programs.
Section 798B. Organic production and market data initiatives
Requires the Secretary to collect and disseminate market
data on the organic agriculture industry.
Section 798C. Organically produced product research and education
Requires the Secretary to produce a report, in consultation
with the Small Farm Commission on implementation of the
National Organic Standards Program about the impact of the
program on small farms.
Section 798D. International organic research collaboration
Requires the Agricultural Research Service and the National
Agricultural Library to facilitate access by research and
extension professionals to organic research conducted outside
the United States.
TITLE VIII--FORESTRY
Section 801. Office of international forestry
This section amends the Food, Agriculture, Conservation,
and Trade Act of 1990 to re-authorize through 2006 the
international forestry office. Under this office, the Forest
Service provides technical assistance to other nations,
especially in the tropics, on such matters as forest management
for sustainable development and global environmental stability.
Section 802. McIntire-Stennis cooperative forestry research program
This section reaffirms the importance of Public Law 87-88,
the McIntire-Stennis Cooperative Forestry Act. Under this
program, authorized by the McIntire-Stennis Act, the Department
of Agriculture funds eligible institutions of higher learning
to support forestry related scientific research.
Section 803. Sustainable forestry outreach initiative; renewable
resources extension activities
This section amends the Renewable Resources Extension Act
of 1978 (RREA) to re-authorize the Act through 2006 and
increase its authorization of appropriation from $15,000,000 to
$30,000,000 each year. The section also creates a sustainable
forestry outreach initiative within the RREA to educate
landowners about sustainable forestry, the importance of
professional forestry advice in achieving sustainable forestry
objectives, and the resources available to assist landowners in
planning for and practicing sustainable forestry.
Section 804. Forestry incentives program
This section amends the Cooperative Forestry Assistance Act
of 1978 to re-authorize the forestry incentives program through
fiscal year 2006. This program provides financial assistance
for forest management such as tree planting, timber stand
improvement, and reforestation on non-federal lands.
Section 805. Sustainable forestry cooperative program
This section amends the Cooperative Forestry Assistance Act
of 1978 to establish a program with $2,000,000 annual mandatory
funding to assist in the development of sustainable forestry
cooperatives owned and operated by nonindustrial private forest
landowners and comprised of members at least 51 percent of whom
are farmers or ranchers. The program shall provide competitive
grants to non-profit organizations that have demonstrated
expertise in cooperative development.
Section 806. Sustainable forest management program
This section amends the Cooperative Forestry Assistance Act
of 1978 to establish a program that is administered by the
Secretary, acting through State foresters, and in coordination
with State coordinating committees. Mandatory funding of
$48,000,000 is available annually and is to be distributed via
a nationwide funding formula. Cost share grants are provided to
nonindustrial private forest landowners who agree to develop a
management plan and implement approved activities for a period
of not less than 10 years. The program ensures that the need
for expanded technical assistance for non-industrial private
forest landowners is met in funding priorities for each State.
The program provides that the Secretary allocate resources
among States to encourage: forest health and productivity,
timber stand improvement and growth, riparian buffer and forest
wetland protection, enhancement of fish and wildlife habitat,
soil, air and water quality, the reduction of soil erosion and
soil quality through agroforestry practices, enhancement of the
forest landbase, reduction of the threat of catastrophic
wildfire, preservation of aesthetic quality and opportunities
for outdoor recreation.
Approved activities include: the restoration of forests for
shelterbelts, windbreaks, and other conservation purposes; the
sustainable growth and management of forests for timber
production, enhancement of forest wetland and riparian areas,
the protection of water quality and watersheds, preservation of
habitat for plants, fish and wildlife, the control of the
spread of invasive species, the acquisition of permanent
easements, and other activities approved by the Secretary.
Section 807. Forest fire research centers
This section amends the Forest Rangeland Renewable
Resources Act of 1978 and requires the Secretary to establish
at least two forest fire research centers at institutions of
higher learning, including in two or more western States. The
centers are established to conduct integrative,
interdisciplinary research into the ecological, socioeconomic,
and environmental impact of fire control and to develop new
fire control technologies. The section also establishes an
advisory committee to set priorities for research under this
program. There are authorized such sums as necessary to carry
out the section.
Section 808. Wildfire prevention and hazardous fuel purchase program
This section amends the Cooperative Forestry Assistance Act
of 1978. The first subsection authorizes the Secretary to
provide grants to eligible entities that use hazardous fuels to
generate electricity. The subsection authorizes appropriations
of $50,000,000 annually. The second subsection authorizes the
Secretary to enter into stewardship contracts for the removal
of hazardous fuels from National Forest System land to
implement the National Fire Plan. There are authorized such
sums as necessary to carry out this subsection.
Section 809. Enhanced community fire protection
This section amends the Cooperative Forestry Assistance Act
of 1978 to authorize the Secretary to cooperate with State
foresters and equivalent State officials to enhance community
fire protection and enhance tree and forest growth and resource
conservation. The section also establishes a community and
private land fire assistance program which enables the
Secretary to undertake a variety of activities aimed at
preventing fires on both Federal and non-federal lands. The
section authorizes appropriations of $35,000,000 annually.
Section 810. Watershed forestry assistance program
This section amends the Cooperative Forestry Assistance Act
of 1978 to authorize the Secretary to establish a cost-share
program to provide to States, through State foresters,
technical, financial, and related assistance to expand forest
stewardship capacities and activities, prevent water quality
degradation, and address watershed issues on non-federal forest
land. The section authorizes appropriations of $20,000,000
annually.
Section 811. General provisions
This section amends the Cooperative Forestry Assistance Act
of 1978 to allow the Secretary to make grants and enter into
contracts, agreements or other arrangements to carry out the
Act.
Section 812. State forest stewardship coordinating committees
This section amends the Cooperative Forestry Assistance Act
of 1978 to add the United States Fish and Wildlife Service to
State coordinating committees under the Act. The section also
requires that each committee submit to the Secretary and the
Committee on Agriculture of the House of Representatives and
the Committee on Agriculture, Nutrition, and Forestry of the
Senate an annual report that lists the members on the committee
and an explanation for the reasons members that may be included
on the committee are not included.
TITLE IX--ENERGY
Section 901. Findings
This section states Congressional findings with respect to
the development of agriculturally based renewable energy, the
promotion of energy efficiency and biobased products.
Section 902. Consolidated Farm and Rural Development Act
This section amends the Act by adding a subtitle L--Clean
Energy.
Section 388A. Definitions
This section includes definitions of biomass, renewable
energy and rural small business.
CHAPTER 1--BIOBASED PRODUCT DEVELOPMENT
Section 388B. Biobased product purchasing requirement
This section establishes a mandatory federal purchasing
requirement of biobased products if they are on a USDA biobased
products list and are comparable in price, performance and
availability to non-biobased products. The section also
instructs the Secretary to develop a labeling program for
biobased products similar to the Energy Star program of the
Department of Energy and Environmental Protection Agency.
Mandatory funding of $2,000,000 is available annually.
Section 388C. Biorefinery development grants
This section establishes a competitive grant program to
support the development of biorefineries for the conversion of
biomass into multiple products such as fuels, chemicals and
electricity. Mandatory funding of $15,000,000 is available
annually.
Section 388D. Biodiesel fuel education program
This section establishes a competitive grant program to
educate government and private entities with vehicle fleets and
the public about the benefits of biodiesel fuel use. The
section authorizes appropriations of $5,000,000 annually.
CHAPTER 2--RENEWABLE ENERGY DEVELOPMENT AND ENERGY EFFICIENCY
Section 388E. Renewable energy development grant program
This section establishes a competitive grant and loan
program to assist new cooperatives and business ventures at
least 51 percent owned by farmers or ranchers for the
development of renewable energy projects to produce
electricity. Mandatory funding of $16,000,000 is available
annually.
Section 388F. Energy audit and renewable energy development program
This section establishes a competitive grant program to
eligible entities to administer farmer, rancher and rural small
business energy audits and renewable energy development
assessments. Mandatory funding of $15,000,000 is available
annually.
Section 388G. Grants and loans to farmers, ranchers and rural small
businesses for renewable energy systems and energy efficiency
improvements
This section establishes a grant and loan program to assist
eligible farmers, ranchers and rural small businesses in
purchasing renewable energy systems and for making energy
efficiency improvements. Mandatory funding of $33,000,000 is
available annually.
Section 388H. Hydrogen and fuel cell technologies program
This section establishes a competitive grant program to
eligible entities to demonstrate the use of hydrogen and fuel
cell technologies in farm and rural applications. Mandatory
funding of $5,000,000 is available annually.
Section 388I. Technical assistance for farmers and ranchers to develop
renewable energy resources
This section states the Secretary, acting through the
Cooperative State Research, Education, and Extension Service,
and in consultation with the Natural Resources Conservation
Service, may provide education and technical assistance to
farmers and ranchers for the development and marketing of
renewable energy resources.
CHAPTER 3--CARBON SEQUESTRATION RESEARCH, DEVELOPMENT, AND
DEMONSTRATION PROGRAM
Section 388J. Research
This section establishes a carbon sequestration research
and development program to promote understanding of the net
sequestration of organic carbon in soil and net emissions of
other greenhouse gases from agriculture. Requires that, within
three years, the Secretary convene a conference of key
scientific experts on carbon sequestration from various sectors
to establish benchmark standards for measuring soil carbon
content and net emissions of other greenhouse gases, designate
measurement techniques and modeling approaches to achieve such
standards, and evaluate results of analyses on baseline,
permanence and leakage issues. The section authorizes
appropriations of $25,000,000 annually.
Section 388K. Demonstration projects and outreach
This section establishes carbon sequestration monitoring
programs; demonstration projects of methods for measuring,
verifying and monitoring changes in carbon content and
greenhouse gas emissions; and periodic outreach to farmers and
ranchers regarding the connection between global climate change
mitigation strategies and agriculture. The section authorizes
appropriations of $10,000,000 annually.
Section 903. Biomass Research and Development Act of 2000
This section extends the Act's termination date to
September 30, 2006. Mandatory funding of $15,000,000 is
available annually to carry out the purposes of the Act.
Section 904. Rural Electrification Act of 1936
Amends the Rural Electrification Act by adding at the end
the following:
Section 21. Financial and technical assistance for renewable energy
projects
This section establishes a grant and loan program to assist
rural electric cooperatives and other rural electric utilities
in developing renewable energy to serve the needs of rural
communities or for rural economic development. Grants may be
used to help pay for renewable energy project feasibility
studies, and technical assistance. Loans are available for
other costs associated with a project. Mandatory funding of
$9,000,000 is available annually.
Sec. 905. Carbon sequestration demonstration program
This section establishes a competitive research and
development program to test the methodologies by which private
parties may pay farmers and foresters a market-based fee to
store carbon and to otherwise reduce net emissions of
greenhouse gases. Under this program, the Department of
Agriculture would share in the costs of monitoring, verifying
and auditing such trades on a demonstration basis and would
also make grants to researchers to establish the best
methodologies for measuring additional carbon sequestration in
soils and plants. The section authorizes appropriations of
$20,000,000 annually.
Sec. 906. Sense of Congress concerning national renewable fuels
standard
This section expresses the sense of Congress that a
national renewable fuels program should be adopted and that the
Department of Agriculture should ensure its policies and
programs promote the production of fuels from renewable fuel
sources.
Sec. 907. Sense of Congress concerning the bioenergy program of the
Department of Agriculture
This section expresses the sense of Congress that biofuel
production capacity will be needed to phase out methyl tertiary
butyl ether in gasoline and the dependence of the United States
on foreign oil; and the bioenergy program of the Department of
Agriculture should be continued and expanded.
TITLE X--Miscellaneous
Subtitle A--Country of Origin and Quality Grade Labeling
Section 1001. Country of origin labeling
This section amends the Agricultural Marketing Act of 1946
(7 U.S.C. 1621 et seq.) by adding a new Subtitle C containing
the following sections:
Section 271. Definitions
This section defines terms used in the subtitle. For the
purpose of this subtitle, the term ``covered commodity'' means
beef, lamb, pork, farm-raised fish, perishable agricultural
commodities or peanuts but does not include processed beef,
lamb and pork items or frozen entrees containing beef, lamb and
pork.
Section 272. Notice of country of origin
Subsection (a). This subsection requires a retailer of a
covered commodity to inform consumers of the country of origin
of the covered commodity. It establishes the requirements that
must be met before a retailer may designate a covered commodity
as having a United States country of origin.
Subsection (b). This subsection provides that the
notification requirements of this section do not apply to food
service establishments.
Subsection (c). This subsection allows the information
required by this section to be provided to consumers by means
of a label, stamp, mark, placard, or other clear and visible
sign on the covered commodity or on the package, display,
holding unit, or bin containing the commodity at the final
point of sale to consumers.
Subsection (d). This subsection allows the Secretary to
require that any person who prepares, stores, handles, or
distributes a covered commodity for retail sale must maintain
records that will permit the Secretary to ensure compliance
with the regulations promulgated under section 274.
Subsection (e). This subsection requires any person engaged
in the business of supplying a covered commodity to a retailer
to provide information to the retailer indicating the
commodity's country of origin.
Subsection (f). This subsection allows the Secretary, in
developing a program to certify country of origin under this
section, to use as a model existing certification programs.
Section 273. Enforcement
This section provides that in general, Section 253 of the
Agricultural Marketing Act will apply to violations of this
subtitle. It requires the Secretary to give notice of a
violation and provide 30 days in which the retailer may remedy
the violation before assessing a fine.
Section 274. Regulations
This section allows the Secretary to promulgate regulations
necessary to carry out this subtitle, and requires the
Secretary to partner with States, to the maximum extent
practicable, to enforce this subtitle.
Section 275. Application
This section provides that this subtitle will apply to the
retail sale of covered commodities beginning 180 days after the
date of the enactment.
Section 1002. Quality grade labeling of imported meat and meat food
products
This section amends the Agricultural Marketing Act of 1946
(7 U.S.C. 1621 et seq.) (as amended by section 1001) by adding
a new Subtitle D containing the following sections:
Section 281. Definition of Secretary
This section defines ``Secretary'' for the purpose of this
subtitle.
Section 282. Quality grade labeling of imported meat and meat food
products
This section prohibits imported meat or meat food products
from bearing a label that indicates a quality grade issued by
the Secretary.
Section 283. Regulations
This section requires the Secretary to promulgate
regulations necessary to ensure compliance with, and carry out,
this subtitle.
Subtitle B--Crop Insurance
Section 1011. Continuous coverage
This section amends Section 508(e)(4) of the Federal Crop
Insurance Act (7 U.S.C. 1508(e)(4)) by removing the time limit
on the prohibition on continuous coverage in that section.
Section 1012. Quality loss adjustment procedures
This section amends Section 508(m)(3) of the Federal Crop
Insurance Act (7 U.S.C. 1508(m)(3)) to require that adjustments
to the procedures described in this subsection be made by the
2003 reinsurance year.
Section 1013. Conservation Requirements
Subsection (a). This subsection amends Section 1211(1)(A)
of the Food Security Act of 1985 (16 U.S.C. 3811(1)) to provide
that persons who produce agricultural commodities on highly
erodible land in any crop year without complying with
conservation requirements are ineligible during that crop year
for payments under any contract (as opposed to production
flexibility contracts specifically, as provided by existing
law), as well as ineligible for marketing assistance loans and
any type of price support or payment under the Agricultural
Market Transition Act. It also adds a new subparagraph (C)
listing another category of payments for which such persons are
ineligible--indemnity payments under the Federal Crop Insurance
Act (7 U.S.C. 1501 et seq.).
Subsection (b). This subsection amends Section 1221(b) of
the Food Security Act of 1985 (16 U.S.C. 3821(b)) to provide
that persons who produce agricultural commodities on converted
wetland in any crop year are ineligible during that crop year
for payments under any contract (as opposed to production
flexibility contracts specifically, as provided by existing
law), as well as ineligible for marketing assistance loans and
any type of price support or payment under the Agricultural
Market Transition Act. It also adds farm storage facility loans
made under section 4(h) of the Commodity Credit Corporation
Charter Act (15 U.S.C. 714b(h)), disaster payments, and
indemnity payments under the Federal Crop Insurance Act (7
U.S.C. 1501 et seq.) to the list of loans and payments for
which such persons are ineligible.
Subsection (c). This subsection amends Section 519(b) of
the Controlled Substances Act (21 U.S.C. 889) by making
technical changes, and by adding to the list of loans and
payments for which persons convicted of cultivating controlled
substances are ineligible (A) payments made pursuant to a
contract entered into under the environmental quality
incentives program under chapter 4 of subtitle D of title XII
of the Food Security Act of 1985 (16 U.S.C. 3839aa et seq.);
(B) a payment under any other provision of subtitle D of title
XII of that Act (16 U.S.C. 3830 et seq.); (C) a payment under
section 401 or 402 of the Agricultural Credit Act of 1978 (16
U.S.C. 2201, 2202); or (D) a payment, loan, or other assistance
under section 3 or 8 of the Watershed Protection and Flood
Prevention Act (16 U.S.C. 1003 and 1006a).
Subtitle C--General Provisions
Section 1021. Unlawful stockyard practices involving nonambulatory
livestock
This section amends Title III of the Packers and Stockyards
Act, 1921, by inserting after section 317 (7 U.S.C. 217a) the
following new section:
Section 318. Unlawful stockyard practices involving nonambulatory
livestock
Subsection (a). This subsection defines terms used in this
section.
Subsection (b). This subsection provides that in general,
it will be unlawful under section 312 of this Act for any
stockyard owner, market agency, or dealer to buy, sell, give,
receive, transfer, market, hold, or drag any nonambulatory
livestock unless the nonambulatory livestock has been humanely
euthanized. This prohibition will not apply to any farm not
subject to the authority of the Grain Inspection, Packers, and
Stockyards Administration, nor will it apply in a case in which
nonambulatory livestock receive veterinary care intended to
render the livestock ambulatory.
Section 1022. Cotton classification services
This section re-authorizes and extends the cotton
classification activities of the Department of Agriculture
under the Cotton Statistics and Estimates Act through 2006.
Section 1023. Protection for purchasers of farm products
This section amends the Food Security Act of 1985 to
conform provisions to the revised Uniform Commercial Code. It
allows filings for security interests in farm products to
identify the State, county, or parish in which the product is
located, instead of requiring the exact description of property
where the product is located.
Section 1024. Penalties and foreign commerce provisions of the Animal
Welfare Act
This section amends Section 26(e) of the Animal Welfare Act
(7 U.S.C. 2156(e)) by increasing the penalties for violations
from a maximum fine of $5,000 to a maximum fine of $15,000, and
from a maximum of one year in prison to a maximum of two years
in prison. This section also amends Section 26(g)(2)(B) to add
a prohibition against the transporting of animals for fighting
purposes from any State into any foreign country.
Section 1025. Prohibition on interstate movement of animals for animal
fighting
This section amends Section 26(d) of the Animal Welfare Act
(7 U.S.C. 2156(d)) to prohibit the movement in interstate or
foreign commerce of live birds for the purpose of animal
fighting. Existing law allows the interstate movement of birds
for fighting purposes as long as they are shipped to a state
where fighting is legal. The prohibition does not apply to the
selling, buying, transporting, or delivery of birds in
interstate or foreign commerce for purposes other than the
participation of the animal in an animal fighting activity.
Section 1026. Outreach and assistance for socially disadvantaged
farmers and ranchers
This section amends Section 2501 of the Food, Agriculture,
Conservation, and Trade Act of 1990 (7 U.S.C. 2279) by striking
subsection (a) and inserting a new subsection (a) containing
the following paragraphs:
Paragraph (1). This paragraph defines terms used in this
subsection.
Paragraph (2). This paragraph requires the Secretary to
carry out an outreach and technical assistance program to
encourage and assist socially disadvantaged farmers and
ranchers in owning and operating farms and ranches and in
participating equitably in the full range of agricultural
programs offered by the Department.
Paragraph (3). This paragraph provides that the outreach
and technical assistance program under paragraph (2) must
enhance coordination of the outreach, technical assistance, and
education efforts authorized under various agriculture
programs, and must include information on, and assistance with,
commodity, conservation, credit, rural, and business
development programs, application and bidding procedures, farm
and risk management, marketing, and other activities essential
to participation in the Department's programs.
Paragraph (4). This paragraph provides that in general, the
Secretary may make grants to, and enter into contracts and
other agreements with, an eligible entity to provide
information and technical assistance under this subsection.
Paragraph (5). This paragraph authorizes appropriations of
$25,000,000 for each of fiscal years 2002 through 2006 to carry
out this subsection. In addition to the funds authorized to be
appropriated to carry out this subsection, any agency of the
Department may participate in any grant, contract, or agreement
entered into under this section by contributing funds if the
agency determines that the objectives of the grant, contract,
or agreement will further the authorized programs of the
contributing agency.
Section 1027. Public disclosure requirements for county committee
elections
This section amends Section 8(b)(5) of the Soil
Conservation and Domestic Allotment Act (16 U.S.C. 590h(b)(5))
by striking subparagraph (B) and inserting a new subparagraph
(B) providing that in general, in each county or area in which
activities are carried out under this section, the Secretary
will establish a county or area committee. The Secretary may
designate local administrative areas within a county or a
larger area under the jurisdiction of a committee. A committee
will consist of between three and five members that are fairly
representative of the agricultural producers within the area
covered by the county, area, or local committee and are elected
by the agricultural producers who participate or cooperate in
programs administered within the area under the jurisdiction of
the county, area, or local committee. The Secretary is required
to establish procedures for nominations and elections to
county, area, or local committees. Each solicitation of
nominations, and notice of elections, to a county, area, or
local committee must include the nondiscrimination statement
used by the Secretary. To be eligible for nomination and
election to the applicable county, area, or local committee, as
determined by the Secretary, an agricultural producer must be
located within the area under the jurisdiction of a county,
area, or local committee, and participate or cooperate in
programs administered within that area. In addition to
establishing nominating procedures, the Secretary must solicit
and accept nominations from organizations representing the
interests of socially disadvantaged groups (as defined in
section 355(e)(1) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 2003(e)(1)). At least ten days before
the date on which ballots are to be opened and counted, a
county, area, or local committee must announce the date, time,
and place at which election ballots will be opened and counted,
and the ballots cannot be opened until that date, time, and
place. Any person may observe the opening and counting of the
election ballots. Not later than 20 days after the date on
which an election is held, a county, area, or local committee
must file an election report with the Secretary and the State
office of the Farm Service Agency that includes the number of
eligible voters in the area covered by the county, area, or
local committee; the number of ballots cast in the election by
eligible voters (including the percentage of eligible voters
who cast ballots); the number of ballots disqualified in the
election; the percentage that the number of ballots
disqualified is of the number of ballots received; the number
of nominees for each seat up for election; the race, ethnicity,
and gender of each nominee, as provided through the voluntary
self-identification of each nominee; and the final election
results (including the number of ballots received by each
nominee). Not later than 90 days after the date on which the
first election of a county, area, or local committee that
occurs after the date of enactment of the Agriculture,
Conservation, and Rural Enhancement Act of 2001 is held, the
Secretary must complete a report that consolidates all the
election data reported to the Secretary under this
subparagraph. With respect to election reform, if determined
necessary by the Secretary after analyzing the data contained
in the report, the Secretary will promulgate and publish in the
Federal Register proposed uniform guidelines for conducting
elections for members and alternate members of county, area,
and local committees not later than one year after the date
ofcompletion of the report. The procedures promulgated by the Secretary
must ensure fair representation of socially disadvantaged groups in an
area covered by the county, area, or local committee, in cases in which
those groups are underrepresented on the county, area, or local
committee for that area. The Secretary may ensure inclusion of socially
disadvantaged farmers and ranchers through provisions allowing for
appointment of additional voting members to a county, area, or local
committee or through other methods consistent with the Constitution.
The term of office for a member of a county, area, or local committee
will not exceed three years.
Section 1028. Pseudorabies Eradication Program
This section amends the Food, Agriculture, Conservation,
and Trade Act of 1990 to reauthorize and extend the
Pseudorabies Eradication Program through 2006.
Section 1029. Tree Assistance Program
This section amends Section 194 of the Federal Agriculture
Improvement and Reform Act of 1996 (Public Law 104-127; 110
Stat. 945) to read as follows:
Subsection (a). This subsection defines terms used in this
section.
Subsection (b). Eligibility:
Paragraph (1). This paragraph requires the Secretary to
provide assistance to eligible orchardists that, as determined
by the Secretary, planted trees for commercial purposes and
lost those trees as a result of a natural disaster.
Paragraph (2). This paragraph provides that an eligible
orchardist will qualify for assistance only if the tree
mortality rate of the orchardist, as a result of the natural
disaster, exceeds 15 percent (adjusted for normal mortality),
as determined by the Secretary.
Subsection (c). Assistance:
Paragraph (1). This paragraph provides that in general,
assistance provided by the Secretary to eligible orchardists
for losses described in subsection (b) will consist of
reimbursement of 75 percent of the cost of replanting trees
lost due to a natural disaster, as determined by the Secretary,
in excess of 15 percent mortality (adjusted for normal
mortality), or at the discretion of the Secretary, sufficient
tree seedlings to reestablish the stand.
Paragraph (2). This paragraph limits the total amount of
payments that a person may receive under this section to
$100,000 or an equivalent value in tree seedlings. The
Secretary must promulgate regulations that define the term
``person'' for the purposes of this section (which will
conform, to the extent practicable, to the regulations defining
the term ``person'' promulgated under section 1001 of the Food
Security Act of 1985 (7 U.S.C. 1308), and prescribe such rules
as the Secretary determines are necessary to ensure a fair and
reasonable application of the limitation established under this
section.
Subsection (d). This subsection provides that
notwithstanding section 161, there is authorized to be
appropriated such sums as are necessary to carry out this
section for each of fiscal years 2002 through 2006.
This section applies to tree losses that are incurred as a
result of a natural disaster after January 1, 2000.
Section 1030. National Organic Certification Cost-Share Program
Subsection (a). This subsection provides that in general,
the Secretary (acting through the Agricultural Marketing
Service) must use $3,500,000 in mandatory funds for fiscal year
2002 to establish a national organic certification cost-share
program to assist producers and handlers of agricultural
products in obtaining certification under the national organic
production program established under the Organic Foods
Production Act of 1990 (7 U.S.C. 6501 et seq.).
Subsection (b). This subsection provides that the Secretary
will pay not more than 75 percent of the costs incurred by a
producer or handler in obtaining certification under the
national organic production program, as certified to and
approved by the Secretary. The maximum amount of a payment made
to a producer or handler under this section will be $500.
Section 1031. Food Safety Commission
Subsection (a). Establishment:
Paragraph (1). This paragraph provides that there is
established a commission to be known as the ``Food Safety
Commission'' (referred to in this section as the
``Commission'').
Paragraph (2). This paragraph provides the Commission will
be composed of 15 members, of whom four will be appointed by
the Majority Leader of the Senate, three will be appointed by
the Minority Leader of the Senate, four will be appointed by
the Speaker of the House of Representatives, three will be
appointed by the Minority Leader of the House of
Representatives, and one will be appointed jointly by the
Speaker of the House of Representatives and the Majority Leader
of the Senate and will serve as Chairperson. Members of the
Commission will be knowledgeable about matters within the
jurisdiction of the Commission, will represent consumer groups,
food processors, food producers, and food retailers, public
health professionals, food inspectors, food safety regulators,
members of academia, or any other interested individuals, and
will not be Federal employees. Members of the Commission are to
be appointed no later than 60 days after the date of enactment
of this Act. The Speaker of the House of Representatives, the
Minority Leader of the House of Representatives, the Majority
Leader of the Senate, and the Minority Leader of the Senate
must consult among themselves prior to appointing the members
of the Commission to achieve, to the maximum extent
practicable, consensus on the appointments and fair and
equitable representation of various points of view with respect
to matters reviewed by the Commission. A vacancy on the
Commission will not affect the powers of the Commission, and
will be filled within 60 days of the vacancy and in the same
manner as the original appointment was made.
Paragraph (3). This paragraph provides that the initial
meeting of the Commission will be conducted not later than 30
days after the later of the date of appointment of the final
member of the Commission or the date on which funds authorized
to be appropriated under subsection (f)(1) are made available.
The Commission will meet at the call of the Chairperson.
Paragraph (4). This paragraph provides that a majority of
the members of the Commission will constitute a quorum to
conduct business. At the first meeting of the Commission, the
Commission will adopt standing rules to guide the conduct of
business and decision making of the Commission. To the maximum
extent practicable, the Commission will carry out the duties of
theCommission by reaching consensus. If the Commission is
unable to achieve consensus with respect to a particular decision, the
Commission will vote on the decision.
Subsection (b). Duties:
Paragraph (1). This paragraph provides that in general, the
Commission will make specific recommendations that build on and
implement, to the maximum extent practicable, the
recommendations contained in the report of the National Academy
of Sciences entitled ``Ensuring Safe Food from Production to
Consumption'' and that will serve as the basis for draft
legislative language to improve the food safety system, improve
public health, create a harmonized, central framework for
managing Federal food safety programs (including outbreak
management, standard-setting, inspection, monitoring,
surveillance, risk assessment, enforcement, research, and
education), enhance the effectiveness of Federal food safety
resources, and eliminate, to the maximum extent practicable,
gaps, conflicts, duplication, and failures in the food safety
system. Recommendations made by the Commission will address (i)
all food available commercially in the United States, including
meat, poultry, eggs, seafood, and produce; (ii) the application
of all resources based on risk, including resources for
inspection, research, enforcement, and education; (iii)
shortfalls, redundancy, and inconsistency in laws (including
regulations); and (iv) the use of science-based methods,
performance standards, and preventative control systems to
ensure the safety of the food supply of the United States.
Paragraph (2). This paragraph provides that not later than
one year after the date on which the Commission first meets,
the Commission must submit to the President and Congress a
comprehensive report that includes (A) the findings,
conclusions, and recommendations of the Commission; (B) a
summary of any reports submitted to the Commission under
subsection (e) by the Advisory Commission on Intergovernmental
Relations and the National Academy of Sciences; (C) a summary
of any other material used by the Commission in the preparation
of the report under this paragraph; and (D) if requested by one
or more members of the Commission, a statement of the minority
views of the Commission.
Subsection (c). Powers of the Commission:
Paragraph (1). This paragraph provides that the Commission
may, for the purpose of carrying out this section, hold
hearings, meet and act, take testimony, receive evidence, and
administer oaths.
Paragraph (2). This paragraph provides that in general,
Section 1821 of title 28, United States Code, will apply to
witnesses requested to appear before the Commission. The per
diem and mileage allowances for a witness shall be paid from
funds available to pay the expenses of the Commission.
Paragraph (3). This paragraph provides that in general, the
Commission may secure directly, from any Federal department or
agency, information necessary to carry out its duties. On the
request of the Commission, the head of a department or agency
must furnish information requested by the Commission. The
furnishing of information by a department or agency to the
Commission will not be considered a waiver of any exemption
available to the department or agency under section 552 of
title 5, United States Code. For purposes of section 1905 of
title 18, United States Code, the Commission will be considered
an agency of the Federal Government, and any individual
employed by an individual, entity, or organization that is a
party to a contract with the Commission under subsection (e)
will be considered an employee of the Commission. Information
obtained by the Commission, other than information that is
available to the public, will not be disclosed to any person in
any manner except to an employee of the Commission, or in
compliance with a court order, or, in any case in which the
information is publicly released by the Commission, in an
aggregate or summary form that does not directly or indirectly
disclose the identity of any person or business entity or any
information the release of which is prohibited under section
1905 of title 18, United States Code.
Subsection (d). Commission Personnel Matters:
Paragraph (1). This paragraph provides that a member of the
Commission will be compensated at a rate equal to the daily
equivalent of the annual rate of basic pay prescribed for level
IV of the Executive Schedule under section 5315 of title 5,
United States Code, for each day (including travel time) during
which the member is engaged in the performance of the duties of
the Commission.
Paragraph (2). This paragraph provides that a member of the
Commission will be allowed travel expenses, including per diem
in lieu of subsistence, at rates authorized for an employee of
an agency under subchapter I of chapter 57 of title 5, United
States Code.
Paragraph (3). This paragraph provides that the Chairperson
of the Commission may, without regard to the civil service laws
(including regulations), appoint and terminate an executive
director and such other additional personnel as are necessary
to enable the Commission to perform the duties of the
Commission. The rate of pay for the executive director and
other personnel shall not exceed the rate payable for level V
of the Executive Schedule under section 5316 of title 5, United
States Code.
Paragraph (4). This paragraph provides that an employee of
the Federal Government may be detailed to the Commission,
without reimbursement, for such period of time as the
Commission may require. The detail of the employee shall be
without interruption or loss of civil service status or
privilege.
Paragraph (5). This paragraph provides that the Chairperson
of the Commission may procure temporary and intermittent
services in accordance with section 3109(b) of title 5, United
States Code, at rates for individuals that do not exceed the
daily equivalent of the annual rate of basic pay prescribed for
level V of the Executive Schedule under section 5316 of that
title.
Subsection (e). Contracts for Research:
Paragraph (1). This paragraph provides that in carrying out
its duties, the Commission may enter into contracts with the
Advisory Commission on Intergovernmental Relations under which
the Advisory Commission on Intergovernmental Relations will
conduct a thorough review of, and will catalogue, all
applicable Federal, State, local, and tribal laws, regulations,
and ordinances that pertain to food safety in the United
States. A contract under this paragraph will require that, not
later than 240 days after the date on which the Commission
first meets, the Advisory Commission on Intergovernmental
Relations will submit a report that describes the results of
the services rendered by the Advisory Commission on
Intergovernmental Relations under the contract.
Paragraph (2). This paragraph provides that in carrying out
its duties, the Commission may enter into contracts with the
National Academy of Sciences to obtain research or other
assistance. A contract under this paragraph will require that,
not later than 240 days after the date on which the Commission
first meets, the National Academy of Sciences will submit to
the Commission a reportthat describes the results of the
services to be rendered by the National Academy of Sciences under the
contract.
Paragraph (3). This paragraph provides that nothing in this
subsection limits or otherwise affects the ability of the
Commission to enter into a contract with an entity or
organization that is not described in paragraph (1) or (2) to
obtain assistance in conducting research necessary to carry out
the duties of the Commission.
Subsection (f). This subsection authorizes appropriations
of $3,000,000 to carry out this section. No payment may be made
under subsection (d) or (e) except to the extent provided for
in advance in an appropriations Act.
Subsection (g). This subsection provides that the
Commission will terminate on the date that is 60 days after the
date on which the Commission submits the recommendations and
report under subsection (b).
Section 1032. Humane methods of animal slaughter
This section expresses the sense of Congress that the
Humane Methods of Slaughter Act should be fully enforced and
that USDA should resume tracking violations of the Act.
Subtitle D--Administration
Section 1041. Regulations
This section allows the Secretary to promulgate such
regulations as are necessary to implement this Act and the
amendments made by this Act, and includes provisions relating
to rulemaking procedures.
Section 1042. Effect of Amendments
This section provides that in general, this Act and the
amendments made by this Act will not affect the authority of
the Secretary to carry out an agricultural market transition,
price support, or production adjustment program for any of the
1996 through 2001 crop, fiscal, or calendar years. A provision
of this Act or an amendment made by this Act will not affect
the liability of any person under any provision of law as in
effect immediately before the date of enactment of this Act.
V. Legislative History and Votes in Committee
(A) HEARINGS
On January 30, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing to review the final
report of the 21st Century Commission on Production
Agriculture. The 11-member Commission was created by the
Federal Agriculture Improvement and Reform (FAIR) Act of 1996
to identify the appropriate role of the federal government in
production agriculture following expiration of the FAIR Act in
2001. Members of the Commission who appeared before the
committee included Dr. Barry Flinchbaugh, (Chairman of the
Commission), Kansas State University, Manhattan, Kansas; Bruce
Brumfield, Duncan Gin, Inc., Iverness, Mississippi; John
Campbell, Ag Processing, Inc., Omaha, Nebraska; Mr. Donald
Cook, Pendleton, Oregon; Jim DuPree, Newport, Arkansas; Mr.
Charles Kruse, Missouri Farm Bureau, Jefferson City, Missouri;
William Northey, Spirit lake, Iowa; Ralph Paige, Federation of
Southern Cooperatives, East point, Georgia; Bob Stallman,
American Farm Bureau, Park Ridge, Illinois; Leland Swenson,
National Farmers Union, Aurora, Colorado; and Don Villwock,
Edwardsport, Indiana. The Department of Agriculture's Chief
Economist, Dr. Keith Collins, also testified about recent
market and policy developments. In his opening statement,
Chairman Lugar hailed the Commission's report as the beginning
of the 2002 farm bill process. He addressed some of the
structural issues in agriculture, and raised concerns about
unintended consequences of farm policy that may be hurting some
farmers more than helping them. Ranking member Harkin applauded
the hard work undertaken by Commission members, but expressed
some disappointment that they had chosen not to explore certain
types of farm policy issues in their report, such as renewable
energy, nutrition assistance, and rural development. He also
noted that despite widespread financial difficulty in the farm
sector, the report recommended only incremental changes to
existing policy.
On February 28, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing to review the state of
conservation programs in the current farm bill. Those
testifying before the committee included: Katherine Smith,
Director of Resource Economics, USDA Economic Research Service,
Washington, D.C.; Jeffery Zinn, Resource, Science and Industry
Division, Congressional Research Service; Thomas Weber, Deputy
Chief for Programs, USDA Natural Resources Conservation
Service, Washington, D.C.; and Robert Stephenson, Director of
Conservation and Environmental Programs, USDA Farm Service
Agency, Washington, D.C. The witnesses testified about the
background and current status of conservation programs run by
the USDA. They provided specific information on the enrollment
levels, backlog, environmental benefits and need for changes in
policy for the Conservation Reserve Program, Environmental
Quality Incentives Program, Wildlife Habitat Incentives
Program, Wetlands Reserve Program, Farmland Protection Program,
conservation compliance, and technical assistance.
On March 1, 2001 the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing to continue reviewing the
state of conservation programs in the current farm bill. Those
testifyingbefore the committee included: Craig Cox, Executive
Director, Soil and Water Conservation Society, Ankeny, Iowa; John
Hassell, Executive Director, Conservation Technology Information
Center, West Lafayette, Indiana; Nathan Rudgers, Commissioner, New York
State Department of Agriculture and Markets, National Association of
State Departments of Agriculture, Washington, D.C.; Paul Johnson,
farmer from Deborah, Iowa; Bob Stallman, President, American Farm
Bureau Federation, Washington, D.C.; Dan Specht, Sustainable
Agriculture Coalition, Washington, D.C.; Tom Buis, Executive Director,
National Farmers Union, Washington, D.C.; Rollin D. Sparrowe,
President, Wildlife Management Institute, Washington, D.C.; Ralph
Grossi, President, American Farmland Trust, Washington, D.C.; David
Stawick, President, Alliance for Agricultural Conservation, Washington,
D.C.; and Paul Faeth, Director, World Resources Institute, Washington,
D.C. The witnesses testified primarily for the need to create a new
conservation incentives program to bolster conservation on working
lands. The new conservation incentives program would provide income to
producers who implement conservation practices and would also reward
those producers who currently maintain conservation practices on their
land. Witnesses also testified for the need for increased funding, and
acreage for existing conservation programs. They also spoke of the need
for increased technical assistance to implement the programs.
On March 24, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing in Spencer, Iowa to
discuss the future of the farm bill and other related
agricultural and rural issues. Those testifying before the
committee included: Dr. Neil Harl, Professor of Economics, Iowa
State University, Ames, Iowa; Joan Blundall, The Seasons Center
for Community Mental Health, Spencer, Iowa; Don Mason,
President-Elect, Iowa Corn Growers Association, Nemaha, Iowa;
Mark Hamilton, Positively Iowa, Iowa Falls, Iowa; Duane Sand,
Iowa Natural Heritage Foundation, Des Moines, Iowa; and Phil
Sundblad, Iowa Farm Bureau Federation, Albert City, Iowa.
Testimony was received on the issues of low commodity prices,
improving income protection, expanding markets for commodities,
and strengthening rural communities and economies. Comments and
remarks were also given by many in the audience.
On March 24, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing in Lewis, Iowa to discuss
the future of the farm bill and other related agricultural and
rural issues. Those testifying before the committee included:
Michael Duffy, Professor of Economics, Iowa State University;
David Williams, farmer and Wallace Foundation Learning Center,
Page County, Iowa; John Askew, President, Iowa Soybean
Association; Shirley Frederiksen, Golden Hills Resource
Conservation and Development District; Sam Carney, Vice
President, Iowa Pork Producers Association; Aaron Heley Lehman,
Iowa Farmers Union; Denise O'Brien, Atlantic, Iowa; Gayl
Hopkins; Harold Swanson; Joyce Schulte, Southwest Community
College; Alan Zellmer, farmer/producer; Erwin Aust, Shenandoah,
Iowa; Fox Ridge Farms, Carson, Iowa; Rod Bentley, President of
Pottawattamie County Cattlemen's Association; Ron Brownlee,
Adair County; Bill Ortner, farmer, Danbury, Iowa; Dan Morgan,
farmer, Corning, Iowa; and Jim Hanson, New Market, Iowa.
Testimony was received on the issues of low commodity prices,
improving income protection, expanding markets for commodities,
and strengthening rural communities and economies. Comments and
remarks were also given by many in the audience.
On March 27, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing to review the Research,
Extension and Education title of the Farm Bill. Those
testifying before the committee included: Dr. Colien Hefferan,
Administrator, Cooperative State Research, Education, and
Extension Service, U.S. Department of Agriculture, Washington,
D.C.; Dr. Floyd P. Horn, Administrator, Agricultural Research
Service, U.S. Department of Agriculture, Washington, D.C.; Jon
Caspers, Board Member, National Coalition for Food and
Agricultural Research, Swaledale, Iowa; Jay Lemmermen, Producer
Chair, Animal Ag Coalition, Okeechobee, Florida; Dr. Richard
Stuckey, Executive Vice President, Council for Agricultural
Science and Technology, Ames, Iowa; Dr. Phil Robertson, Member,
Committee on an Evaluation of the U.S. Department of
Agriculture, National Research Initiative Competitive Grants
Program National Research Council, Hickory Corners, Michigan;
Dr. Fred Kirschenmann, Director, Leopold Center for Sustainable
Agriculture, Ames Iowa; Dr. David Chicoine, Chair, National
Association of State Universities and Land Grant Colleges Board
of Agriculture and Dean, College of Agricultural, Consumer, and
Environmental Sciences, University of Illinois, Urbana,
Illinois; Dr. Bobby Phills, Chair, 1890 Legislative Committee,
Dean and Director of Land Grant programs, College of
Engineering Sciences, Technology and Agriculture, Florida A&M
University, Tallahassee, Florida; and Dr. Vic Lechtenberg,
Chair, National Agricultural Research, Extension, Education and
Economics Advisory Board and Dean of Agriculture, Purdue
University, West Lafayette, Indiana.
On April 25, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a full committee hearing to review
the Trade title of the Farm bill. Those testifying before the
committee included: Bruce Babcock, Director, Center for
Agricultural and Rural Development, Iowa State University,
Ames, Iowa; Ron Heck, Soybean Producer, Perry, Iowa; Robert
Stallman, President, American Farm Bureau Federation, Columbus,
Texas; Leland Swenson, President, National Farmers Union,
Aurora, Colorado; Charles J. O'Mara, president, O'Mara and
Associates, Washington, D.C.; James Echols, Chairman, National
Cotton Council, Cordova, Tennessee; Timothy F. Hamilton,
Executive Director, Mid-America International Agri-Trade
Council, Executive Director, food Export USA--Northeast,
Chicago, Illinois; Dennis McDonald, Chairman, Trade Committee
for R-CALF United Stockgrowers of America, Melville, Montana;
Judith Lewis, Acting Director of Resources and External
Relations, World Food Program, Rome, Italy; Ken Hackett,
Executive Director, Catholic Relief Services, Baltimore,
Maryland and Gary Martin, President, North American Export
Grain Association, Washington, D.C. In his opening statement,
Chairman Lugar emphasized the importance of agricultural trade
to American farmers, and urged rapid passage of legislation
granting Trade Promotion Authority to the President. Ranking
member Harkin noted that while the U.S. domestic market is
still important, the export market will be crucial for
absorbing that expanding portion of production which cannot
find a domestic outlet. He underscored the necessity to not
consider our trade policy or domestic programs in agriculture
in isolation, but instead they must be developed in an
integrated manner.
On May 16, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a full committee hearing to review
the Credit Title of the farm bill. Those testifying before the
committee included: Neil Conklin, Director, Market and Trade
Economics Division, EconomicResearch Service, U.S. Department
of Agriculture, Washington, D.C.; Carolyn B. Cooksie, Deputy
Administrator for Farm Loan Programs, Farm Service Agency, U.S.
Department of Agriculture, Washington, D.C.; Lawrence J. Dyckman,
Director of Agricultural Issues, U.S. General Accounting Office,
Washington, D.C., accompanied by Charles Adams, Assistance Director;
Jay B. Penick, President and Chief Executive Officer, Northwest Farm
Credit Services, Washington, D.C., on behalf of the Farm Credit
Council; Henry D. Edelman, Chief Executive Officer, Farmer Mac,
Washington, D. C.; John Evans, Jr., Chief Executive Officer, D.L. Evans
Bank, Burley, Idaho, on behalf of Independent Community Bankers of
America; Gary R. Canada, President, Bank of England, England, Arkansas,
on behalf of American Bankers Association; David Carter, President,
Rocky Mountain Farmers Union, on behalf of the National Farmers Union,
Washington, D.C.; Frank Brost, Rapid City, South Dakota, Chairman, Tax
and Credit Committee, National Cattlemen's Beef Association; and Ferd
Hoefner, Washington Representative, Sustainable Agriculture Coalition,
Washington, D.C.
On June 28, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing to obtain an overview of
the major issue areas and issues that the Committee will be
dealing with in developing a new farm bill. The hearing was
intended to reflect the breadth of the topics and issues that
must be dealt with in a comprehensive farm bill. Those
testifying before the committee included: Leland Swenson,
President, National Farmers Union, Washington, D.C.; Bob
Stallman, President, American Farm Bureau Federation,
Washington, D.C.; Chuck Fluharty, Director, Rural Policy
Research Institute, Columbia, Missouri; Craig Cox, Executive
Vice President, Soil and Water Conservation Society, Ankeny,
Iowa; Howard Learner, Environmental Law and Policy Center,
Chicago, Illinois; Dr. Barbara Glenn, Member of the Board of
Directors, National Coalition for Food and Agricultural
Research, Executive Vice President, Federation of Animal
Science Societies, Bethesda, Maryland; Sharon Daly, Vice
President for Social Policy, Catholic Charities, Alexandria,
Virginia; and Dave Carter, Secretary-Treasurer, Mountain View
Harvest Cooperative, Longmont, Colorado. In his first hearing
as Chairman of the Committee, Senator Harkin emphasized the
need for a comprehensive farm bill, because of its importance
to the entire nation. He asserted his desire to write a farm
bill that will look ahead, rather than try to fix the problems
or settle the issues of the past.
On July 12, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing to consider the next
federal farm bill. Representatives from the feed grains and oil
seeds industries presented their comments. The Chairman opened
the hearing stating that it is his goal to develop policies
that will help farmers get more of the consumer dollar than
they are presently getting which is at an historic low. He also
stated that it is crucial to devote more of our attention to
looking at ways to generate greater utilization of our crops
domestically. Those testifying before the committee included:
Lee Klein, President, National Corn Growers Association, Battle
Creek, Nebraska accompanied by Ron Litterer, Green, Iowa; Keith
Dittrich, President, American Corn Growers Association, Tilden,
Nebraska; Tony Anderson, President, American Soybean
Association, Mount Sterling, Ohio; John Miller, President,
Miller Milling, Minneapolis, Minnesota, Trudi Evans, President,
Barley Growers Association, Merrill, Oregon and Bill Kubecka,
Vice President for Legislation, Sorghum Growers Association,
Palacios, Texas.
On July 17, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing to receive testimony
regarding the next federal farm bill from producer
representatives and others concerning cotton, wheat, rice,
sugar and peanuts. In his opening statement, the Chairman
recognized the many challenges facing producers of these
diverse crops, which may require very different policies to
address. Those testifying before the committee included: James
Echols, Chairman of the Board, National Cotton Council,
Cordova, Tennessee; Dusty Tallman, President, National
Association of Wheat Growers, Brando, Colorado; John Denison,
Chairman, Rice Foundation, Iowa accompanied by Nolan Canon,
Chairman, U.S. Rice Producers Association Tunica, Mississippi;
Jack Roney, Director of Economic Analysis, American Sugar
Alliance, Arlington, Virginia; Art Jaeger, Assistant Director,
Consumer Coalition of America, Washington, D.C.; Armond Morris,
Chairman, Georgia Peanut Commission, Ocilla, Georgia
accompanied by Evans J. Plowden, Jr., General Counsel, American
Peanut Shellers, Albany, Georgia; and Wilbur Gamble, Producer
and Chairman of the National Peanut Growers Group, Dawson,
Georgia.
On July 19, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing to elicit suggestions for
the Nutrition Title of the new federal farm bill. Those
testifying included: Eric Bost, Undersecretary for Food,
Nutrition, and Consumer Services, U.S. Department of
Agriculture, Washington, D.C.; Robert Greenstein, Executive
Director, Center on Budget and Policy Priorities, Washington,
D.C.; Dr. Ron Haskins, Senior Fellow, Brookings Institution,
Washington, D.C.; Karen Ford, Executive Director, Food Bank of
Iowa, Des Moines, Iowa; Kevin W. Concannon, Commissioner, Maine
Department of Human Services, Augusta, Maine; Celine Dieppa,
Food Stamp Program Participant, Manchester, Connecticut; Dean
Leavitt, Chairman and CEO, U.S. Wireless Data, Inc., New York,
New York; Dr. Debra Frank, Director, Growth and Development
Clinic, Boston, Massachusetts and Dr. Cutberto Garza,
Professor, Cornel University, Ithaca, New York.
Undersecretary Bost indicated he supported re-authorization
of the Food Stamp Program, The Emergency Food Assistance
Program, the Food Distribution Program on Indian Reservations,
and the Commodity Supplemental Food Program. His
recommendations relative to the Food Stamp Program included,
the need to explore changes to make the program work better for
working families; facilitate access to the benefits while
minimizing burdens for State agencies; reduce administrative
complexity for local administrators; preserve the program's
national structure and improve the program's effectiveness in
promoting healthy diets for the people it serves; and remain
vigilant in the fight against fraud and abuse.
Mr. Greenstein provided background on the Food Stamp
Program, mentioned recent changes in the composition of the
Food Stamp caseload, and provided trends in Food Stamp
participation and reductions in Food Stamp expenditures. His
recommendations were in the areas of program simplification,
reform of the quality control system, granting to states more
flexibility over various aspects of the delivery of benefits to
eligible households, and narrowing the gaps in coverage to
address the overly large reductions of recent years in the food
purchasing power the program provides to the working poor, the
elderly, and other households.
Mr. Haskins' goal was to stress to the Committee that, even
more than in the past, the Food Stamp Program has become a
vital support to low-income mothers who work (and indicated
that a higher percentage of single mothers are working since
welfare reform than at any time in the past). Secondly, he
stressed that administrative burdens are keeping many qualified
people away and suggested that states should be permitted to
apply a different quality control program to workers versus
non-workers. In addition, he believes states should have the
option to grant families leaving welfare for work with a Food
Stamp benefit that is based on their starting salary and is
fixed for at least six months. Finally, he stressed the Federal
government needs greater assurance that states are informing
low-income families, especially those leaving welfare, of their
right to continue receiving Food Stamps as long as they
qualify.
Ms. Ford requested full funding for the Emergency Food
Assistance Program, including money for storage, transportation
and distribution of bonus commodities. She expressed concern at
the drop in Food Stamp Program participation with a concurrent
rise in the use of emergency feeding sites. Her recommendations
focused on rules' and application simplification, modification
of the quality control system, increases to the minimum
benefit, and implementation of the EBT system.
Mr. Concannon spoke about Maine's excellent outreach,
access, and integrity record and the state's ability to retain
eligible Food Stamp Program participants at a time when other
states are seeing dramatic drops. He indicated that they view
the program as an essential transitional benefit for working
households and promote it as such. He stated that he is a
proponent of program and processing simplification, enhanced
benefits for the elderly and the disabled, doing away with cost
neutrality rules when implementing EBT, overhauling the quality
control system to be less punitive and incorporating additional
performance measures that reward good service.
Ms. Dieppa shared her experiences as a Food Stamp Program
participant and a working mother. She indicated the program has
been an essential work support over the last four years. She
indicated that an excessive amount of paperwork that must be
filed during working hours has meant that she has sometimes
lost food stamp benefits and indicated that it would be
extremely helpful to reduce the administrative burden for
participants.
Mr. Leavitt discussed the benefits of a new technology that
provides farmers with the ability to wirelessly accept EBT
cards at farmers' markets throughout the United States. He
spoke specifically about a pilot program in New York that used
this technology. Unfortunately, he said that at this time the
cost of the wireless technology is quite high.
Dr. Frank, who works with low-income children, presented
data that indicated that Food Stamps make a dramatic difference
in the food security of poor-working families with children. In
turn, she said, the data showed food security is essential for
physical and cognitive health. She encouraged the Committee to
consider provisions that would ensure increased participation,
by children, in the Food Stamp Program.
Dr. Garza focused his remarks on the need to find more
cohesive approaches to prevent childhood obesity and the
increased prevalence of adult diseases (like diabetes) in
children. He proposed adopting sound nutrition policies for the
food assistance programs. He also commended Sen. Harkin's
Global Food for Education Bill, through which children in third
world countries would be able to receive free school meals to
improve their micronutrient profiles.
On July 24, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing to discuss livestock
issues for the new federal farm bill. Those testifying
included: Jon Caspers, National Pork Producers Council,
Swaledale, Iowa; Eric Davis, National Cattlemen's Beef
Association, Bruneau, Idaho; Dennis McDonald, Ranchers-
Cattlemen Action Legal Fund United Stockgrowers of America,
Billings, Montana; Frank Moore, American Sheep Industry
Association, Douglas, Wyoming; William Roenigk, National
Chicken Council, Washington, D.C.; Pete Hermanson, National
Turkey Federation, Story City, Iowa; and Maria Rosmann,
Sustainable Agriculture Coalition, Harlen, Iowa. The hearing
focused on the need for conservation programs to assist
livestock producers. Most of the witnesses spoke of the need to
expand the reach of the Environmental Quality Incentives
Program (EQIP) to all livestock producers, regardless of size.
However, other witnesses preferred the current system which
does not provide cost-share assistance to large livestock
operators to construct animal waste facilities. Some witnesses
expressed the need for additional programs, like the
Conservation Security Act, which will help producers to better
integrate crop and livestock productions in a sustainable
manner. There was also discussion on the need for programs to
help producers develop marketing skills and value-added
enterprises, including organic operations. Witnesses also
expressed a desire to see trade programs, like the Market
Access Program, expanded. Some of the witnesses favored current
commodity programs because of the lower feed prices they
generate.
On July 31, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing that focused on the need
for conservation on lands in production or ``working lands.''
Chairman Harkin stated that he is interested in a strong
conservation title and called the hearing to explore the
benefits of good conservation practices in agriculture,
specifically on working lands. Those testifying before the
committee included: Lee Klein, National Corn Growers
Association and American Soybean Association, Washington, D.C.;
George Dunklin, Jr., USA Rice Federation, Dewitt, Arkansas;
Gary Mast, National Association of Conservation Districts,
Washington, D.C.; Dave Serfling, Land Stewardship Project,
Preston, Minnesota; and Mark Shaffer, Defenders of Wildlife,
Washington, D.C. The witnesses testified primarily for the need
to create a new conservation incentives program to bolster
conservation on working lands. The new conservation incentives
program would provide income to producers who implement
conservation practices. The program would also reward those
producers who currently maintain conservation practices on
their land. Witnesses also testified for the need for increased
funding and technical assistance for conservation programs for
working lands, including the Environmental Quality Incentives
Program, Wildlife Habitat Incentive Program. They also spoke of
the need for increased technical assistance through third-party
providers to implement the programs.
On August 2, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing to discuss rural economic
development issues for the new federal farm bill. Chairman
Harkin opened the hearing by stating that we must take steps
now to encourage growth and opportunity in rural America. He
also said that we must help create the basic infrastructure
required to do business andcreate jobs. Those testifying before
the committee included: David Kolsrud, CORN-er Stone Farmers
Cooperative, Luverene, Minnesota, on behalf of the National Cooperative
Business Association; Ronald L. Phillips, President, Coastal
Enterprises, Inc., Wiscaset, Maine; Chuck Hassebrook, Center for Rural
Affairs, Walthill, Nebraska. Karen Dearlove, president, Indiana
Association of Regional Councils, Jasper, Indiana. Curtis Wynn, Chief
Executive Officer, Roanoke Electric Cooperative, Rich Square, North
Carolina; Deborah M. Markley, Chair, Rural Equity Capital Initiative,
Rural Policy Research Institute, Chapel Hill, North Carolina; Steve
Lane, President, Iowa Independent Bankers Association, Gowrie, Iowa, on
behalf of the Independent Community Bankers of America; Jack Cassidy,
Senior Vice President, CoBank, Grenwoodville, Colorado.
On August 4, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a field hearing in Worthington,
Minnesota to discuss the new federal farm bill. Those
testifying before the committee included: Al Christopherson,
Minnesota Farm Bureau, Pennock, Minnesota; Bob Arndt, Minnesota
NFO, Echo, Minnesota; Dave Frederickson, Minnesota Farmers
Union, St. Paul, Minnesota; Loren Tusa, Minnesota Corn Growers
Association, Alpha, Minnesota; Ed Hegland, Minnesota Soybean
Growers Association, Appleton, Minnesota; Larry Liepold,
Minnesota Pork Producers Association, Okabena, Minnesota;
Monica Kahout, LSP, Olivia, Minnesota; Tim Henning, Nobles
County farmer, Lismore, Minnesota; Dennis Bottem, Minnesota
Cattlemen's Association, St. James, Minnesota; Ron Anderson,
Minnesota Wheat Growers Association, Hallock, Minnesota; Dave
Kolsrud, AgriEnergy, LLC, Luverne, Minnesota; and Bob Kirchner,
Minnesota Soybean Processing, Brewster, Minnesota.
On August 13, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a field hearing in Frankenmuth,
Michigan to discuss speciality crop issues for the new federal
farm bill. Those testifying before the committee included:
Alison Fox, Counsel, Senate Committee on Agriculture,
Nutrition, and Forestry; Hon. James A. Barcia, Member of
Congress from the State of Michigan; Wayne Wood, President,
Michigan Farm Bureau; Carl McIlvain, President, Michigan
Farmers Union; Philip Korson, President, Cherry Marketing
Institute, Inc., Lansing, Michigan; Elwood Kirkpatrick,
President, Michigan Milk Producers Association; Jody Pollok,
Executive Director, Michigan Corn Growers Association; Frank
Kubik, President, National Commodity Supplemental Food Program
Association and CSFP Manager for Focus: HOPE; Dr. Lonnie King,
Dean of the College of Veterinary Medicine at Michigan State
University; Sam Hines, Michigan Pork Producers Association;
Curtis Thayer, Director, Michigan Soybean Association; and
Richard Leach, Executive Vice President, Great Lakes Sugar Beet
Growers Association.
On August 13, 2001, the Senate Committee on Agriculture,
Nutrition, Forestry held a field hearing in Grand Rapids,
Michigan to discuss specialty crop issues for the new federal
farm bill. Those testifying before the committee included:
Alison Fox, Counsel, Senate Committee on Agriculture, Nutrition
and Forestry; J. Ian Gray, Director, Michigan Agricultural
Experiment Station; Thomas C. Butler, Manager, Michigan
Processing Apple Growers Division of Michigan Agricultural
Cooperative Marketing Association; Julia Baehre Hersey, Board
Member, Michigan Apple Committee; Perry DeKryger, Executive
Director, Michigan Asparagus Advisory Board; Bob Green,
Executive Director, Michigan Bean Commission; Dennis Fox,
Environmental Policy Specialist, Michigan United Conservation
clubs; Ron Williams, State conservationist, Natural Resource
Conservation Service; David Armstrong, Executive Vice
President, Marketing, GreenStone Farm Credit Services; and
Joanne Werdel, Policy Analyst and Communications Specialist,
Center for Civil Justice.
On August 27, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a field hearing in Athens, Georgia
to discuss the new federal farm bill. Those testifying before
the committee included: Robert McLendon, Chairman of the
Executive Committee, National Cotton Council; Mary Alice McGee,
Nashville, Georgia; Murray Campbell, Camilla, Georgia and James
Lee Adams, Camilla, Georgia. The discussion focused on the
current condition and future of agriculture in the Southeast.
Leading agriculture representatives and researchers provided
information in the areas of new farm legislation, trade
developments, and agricultural technology.
On August 18, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a field hearing in Tipton, Iowa to
discuss the new federal farm bill. Chairman Harkin opened the
hearing stating that farm families and people who live in rural
America have not shared in our nation's prosperity. He said
that we need new directions in federal agriculture and rural
policies. Those testifying before the committee included: Ross
Paustian, farmer, Walcott, Iowa; Jim Krier, Ollie, Iowa; Deb
Ryun, Executive Director of Conservation Districts of Iowa;
Mary Swalla Holmes, ISU Extension; John Helbling, General
Manager of Economic Market Development, Alliant Energy.
Comments were also taken from audience participants: Brad
Wilson, Jerry Heithoff, John Specht, Gary Lamb, Walter Gray,
Larry Ginter, Wayne Demmer, Rod Stevenson, Francis Thicke, Mike
Jepson, Gary Bierschenk, Jeff Zacharakis-Jutz, Chris Petersen,
John Dietrich, Ed McGivern, Ron Bremley, Carrie Holdgrafer,
Jennifer * * *, Brian Holdgrafer, Bruce Peters, Dwayne Sand,
Lloyd Holecek, Phil Specht, Tony Serbousek and Therese Smith.
Testimony was received on the issues of low commodity prices,
improving income protection, expanding markets for commodities,
and strengthening rural communities and economies. Comments and
remarks were also given by many in the audience.
On August 20, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry conducted a field hearing in
Stewartville, Minnesota to discuss the new federal farm bill.
Those testifying before the committee included: Hon. Gil
Gutknecht, Member of Congress from the State of Minnesota;
Bishop Bernard J. Harrington; David Ladd, on behalf of the Farm
Credit Services; Delbert Mandelko, President, Minnesota Milk
Producers Association; Mike McGrath, on behalf of the Minnesota
Project; Marcie McLaughlin, on behalf of America's State Rural
Development Council; Ken Meter, Crossroads Resource Center,
Minneapolis, Minnesota; Sever Peterson, Eden Prairie,
Minnesota; John Monson, State Executive Director, Minnesota
Farm Service Agency, St. Paul, Minnesota; Ted Winter, State
Representative, State of Minnesota; Mary Ellen Otremba, State
Representative, State of Minnesota; Kenric Scheevel, State
Senator, State of Minnesota; Amber Hanson, Racine, Minnesota;
Colleen Landkramer, Blue Earth County Commissioner, Mankato,
Minnesota; BarbaraJ. Collins, Legal Services Advocacy Project,
St. Paul, Minnesota; Gene Paul, Faribault County, Delavan, Minnesota;
Linda Noble, Organic Dairy Farmer, Kenyon, Minnesota; Eunice Biel,
Dairy Farmer, Harmony, Minnesota; Jim Riddle, Winona, Minnesota; Nancy
Adams, LeRoy, Minnesota; Rev. Chuck Purdhim, (Retired), United
Methodist Church, Brooklyn Center, Minnesota; Phil Specht, Dairy
Farmer, McGregor, Iowa; Kevin Ristau, Jobs Now Coalition, St. Paul,
Minnesota; Lewis Reiman, Utica, Minnesota; Niel Ritchie, Institute for
Agriculture and Trade Policy, Minneapolis, Minnesota; Janice Daley,
Grain Farmer, Lewiston, Minnesota; Sister Kathleen Storm, Mankato,
Minnesota; Kevin Scheidecker, Fillmore Soil and Water Conservation
District, Preston, Minnesota; Mike Noble, Crop and Livestock Producer,
Kenyon, Minnesota; Ron Durst, on behalf of Associated Milk Producers
Inc.; Victor Ormsby, Winona, Minnesota; Tom Hoscheit, Caledonia,
Minnesota; Lorraine Redig, Winona, Minnesota; Keith Speltz, Dairy
Farmer, Southeast Minnesota; Margaret Zimmerman, Waseca, Minnesota; Les
Everett, Water Resources Center, University of Minnesota; Gerald
Tumbleson, Sherburn, Minnesota; Larry Larson, Sargeant, Minnesota; Rick
Hansen, Inver Grove Heights, Minnesota; Ronald Behounek, Hayfield,
Minnesota; Mike Muella, Winthrop, Minnesota; Barbara Upton, Fountain,
Minnesota; Dwight Ault, Austin, Minnesota; Larry Green, Fulda,
Minnesota; Robert M. Austin, New Prague, Minnesota; Roger Dale, Hanley
Falls, Minnesota; Chris C. Petersen, Vice President, Iowa Farmers
Union, Clear Lake, Iowa; Walt Prigge, Byron, Minnesota; Gary Joachim,
Claremont, Minnesota, and on behalf of Minnesota Soybean Growers
Association; Donovan Strom, Fountain, Minnesota; Bert Bowman, Eden
Prairie, Minnesota; Bruce Biederman, Grafton, Iowa; Tim Henning,
Lismore, Minnesota; Larry Predmore, Rochester, Minnesota; Brian Hanson,
Racine, Minnesota; Bill McMillin, Dairy Farmer, Kellogg, Minnesota; Al
Schacht, Zumbro Falls, Minnesota; and Rod Nelson, Chatfield, Minnesota.
On September 26, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry held a hearing to discuss the
Administration perspective with regard to the new federal farm
bill. Secretary of Agriculture, Ann Veneman, appeared before
the Committee to present the Administration views and its
report on food and agricultural policy.
On October 27, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry conducted a field hearing in Boise,
Idaho to discuss the 2002 Farm Bill.
(B) Committee Markup Sessions
On October 31, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry met in open session to mark up the
Credit Title of the new federal farm bill. Those members in
attendance included: Senators Harkin, Leahy, Conrad, Lincoln,
Miller, Stabenow, Nelson, Dayton, Wellstone, Lugar, Cochran,
McConnell, Fitzgerald, Thomas, Allard, Hutchison and Crapo. As
described by Chairman Harkin, the Credit Title, among other
things, addresses the need to help beginning farmers and
ranchers gain greater access to federal farm lending programs.
The Credit Title was adopted by a voice vote.
On November 6, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry met in open session to mark up the
Energy and Forestry Titles of the new federal farm bill. Those
members in attendance included: Senators Harkin, Conrad,
Stabenow, Dayton, Nelson, Lincoln, Wellstone, Leahy, Baucus,
Lugar, Cochran, Hutchinson, Allard, Thomas, Crapo, Fitzgerald,
Roberts, and McConnell. As described by Chairman Harkin, the
Forestry Title continues the commitment to private forest land
management of past farm bills and provides various forms of
assistance to nine million private forest land owners. The
Title addresses community fire protection and economic
opportunities for farmers, ranchers, and others derived from
sustainable forestry practices. A sustainable forest management
program is established to provide states with financial
assistance to meet multiple resource objectives on private
forest lands. Senator Cochran offered an amendment to strike
the mandatory funding requirement and authorize the
appropriation of funds in the same amounts in Section 805 and
806. The Cochran amendment failed by a voice vote. The Chairman
moved to adopt the Forestry Title of the new federal farm bill.
The Forestry Title was adopted by a voice vote. The Committee
then took up the Energy Title. As described by Chairman Harkin,
the Energy Title establishes several new programs providing
incentives to farmers, ranchers and rural small businesses to
develop renewable energy and biomass energy supplies on their
lands and to increase energy efficiency. Senator Thomas offered
an amendment to strike Section 388 (B) which requires a bio-
based product purchasing requirement for federal agencies. The
Thomas amendment failed by a voice vote. Senator Dayton offered
an amendment to Section 388 (d) that would increase the
authorized appropriations from $1 million annually to $5
million annually for the biodiesel fuel education program. The
Dayton amendment was passed by a voice vote. Senator Cochran
offered an amendment to strike the mandatory funding in the
following sections and insert instead an authorization of
funding in the same amounts that are included in each of the
sections: Section 388(B), 388(C), 388(E), 388(F), 388(G),
388(H), and Section 903. The Cochran amendment failed by a
voice vote. Senator Lugar moved that the Energy Title be
adopted, and the Title was adopted by a voice vote.
On November 7, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry met in open session to mark up the Trade
Title of the new federal farm bill. Those members in attendance
included: Senators Harkin, Conrad, Baucus, Lincoln, Miller,
Stabenow, Nelson, Dayton, Wellstone, Lugar, Cochran, Roberts,
Fitzgerald, Thomas, Allard, Hutchinson, and Crapo. As described
by Chairman Harkin, the Trade Title, among other things, seeks
to improve and expand existing export and food programs in
recognition of their important role in the ability to compete
internationally. It recognizes that humanitarian activities
throughout the developing world must be an important component
of a long-term effort to combat poverty and to build bridges of
good will to foreign countries. Senator Lugar moved that the
Trade Title be adopted, and the Title was adopted by a voice
vote.
On November 8, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry met in open session to mark up the Rural
Development and Research Titles of the new federal farm bill.
Those members in attendance included: Senators Harkin, Conrad,
Baucus, Lincoln, Miller, Stabenow, Nelson, Dayton, Wellstone,
Lugar, Cochran, Roberts, Fitzgerald, Thomas, Allard,
Hutchinson, and Crapo. As described by Chairman Harkin, the
Rural Development Title contains a number ofcreative programs
and initiatives designed to make a significant difference in economic
and community development in rural America. Rural communities have not
fully shared in our nation's prosperity and the title helps to generate
the investment needed in rural America by creating and funding the
Rural Business Investment Program and by authorizing the Rural
Cooperative and Business Equity Fund. The title also provides
substantial funding for value-added agricultural product market
development grants to help develop solid new enterprises owned by
agricultural producers in rural areas. The Business and Industry Loan
Guarantee Program is improved and a new way to fund the Rural Economic
Development Grant and Loan Program is established. To help smaller
communities, the title provides an initiative to improve broadband
Internet access. Funding for firefighting and first-responder training
is also provided. Senator Harkin moved that the Research and the Rural
Development Titles both be passed subject to amendments that are
offered and that technical and confirming amendments may be made by
staff. The motion was passed by a voice vote. Senator Cochran expressed
his concern that the Rural Development Title would create a variety of
new programs and provide mandatory funds for them. After allowing an
opportunity for amendments, Chairman Harkin called the Rural
Development Title closed and proceeded to the Research Title. Mr. Lugar
moved an amendment he offered that $360 million a year for the
Initiative for Future Agriculture and Food Systems be adopted for
fiscal years 2003 to 2006. After debate, a recorded vote was taken and
the Lugar amendment failed by a vote of 7 yeas, 13 noes and 1 not
present. Those voting in favor of the amendment included: Senators
Lugar, Helms, McConnell, Roberts, Fitzgerald, Allard, Crapo. Those
voting against the amendment included: Senators Cochran, Hutchinson,
Leahy, Conrad, Daschle, Baucus, Lincoln, Miller, Stabenow, Nelson,
Dayton, Wellstone and Harkin. Senator Thomas was not present.
On November 13, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry met in open session to mark up the
Competition Title of the new federal farm bill. As described by
Chairman Harkin, the Competition Title addresses the necessity
of restoring fairness, transparency and equity to agribusiness.
Senator Wellstone offered an amendment to the proposed Title
that would strengthen and amend section 202 of the Packers and
Stockyards Act of 1921 by prohibiting meat packers from owning
livestock for 14 days prior to the purchase for slaughter.
After debate, a roll call vote was taken and the Wellstone
amendment failed by a vote of 9 yeas, 12 noes. Those Senators
voting in favor of the amendment included: Leahy, Conrad,
Daschle, Baucus, Stabenow, Wellstone, Thomas and Harkin. Those
Senators opposing the amendment included: Lugar, Helms,
Cochran, McConnell, Roberts, Fitzgerald, Allard, Hutchinson,
Crapo, Lincoln, Miller and Nelson. Senator Lugar offered an
amendment to strike the Competition Title from the proposed
bill. After debate, a roll call vote was taken and the Lugar
amendment passed by a vote of 12 ayes, 9 noes. Those Senators
voting in favor of the amendment included: Lugar, Helms,
Cochran, McConnell, Roberts, Fitzgerald, Thomas, Allard,
Hutchinson, Crapo, Lincoln and Miller. Those Senators opposing
the amendment included: Leahy, Conrad, Daschle, Baucus,
Stabenow, Nelson, Dayton, Wellstone and Harkin. The Competition
Title was stricken from the bill.
On November 14, 2001, the Senate Committee on Agriculture,
Nutrition and Forestry met in open session to mark up the
Nutrition Title of the new federal farm bill. Those in
attendance included: Senators Harkin, Conrad, Baucus, Lincoln,
Miller, Stabenow, Nelson, Dayton, Wellstone, Lugar, Cochran,
Roberts, Fitzgerald, Thomas, Allard, Hutchinson, and Crapo. As
described by Chairman Harkin, the chairman's mark strengthens
the program to help people more successfully transition from
welfare to work and helps shield low-wage working families from
the recession. Other provisions in the chairman's mark include:
extending the period of time that able-bodied adults without
dependents may participate in the food stamp program allowing
them time to find and keep a job; simplifying the program and
lightening the administrative burden; assisting with efforts to
reach all children who are poor and for whom a proper diet is
crucial; and increasing the standard deduction for food stamp
families. It also makes modest changes regarding legal
immigrants and their children by allowing families into the
program after working here for four years. Senator Lugar moved
a substitute amendment for the Harkin language in the nutrition
title. After debate, a roll call vote was taken and the
amendment failed by a vote of 9 yeas and 12 noes . Those voting
for the amendment included: Senators Lugar, Cochran, McConnell,
Roberts, Fitzgerald, Thomas, Allard, Crapo and Wellstone; those
voting against the amendment included: Helms, Hutchinson,
Leahy, Conrad, Daschle, Baucus, Lincoln, Miller, Stabenow,
Nelson, Dayton, and Harkin. The Chairman moved that the
Nutrition Title be adopted, and the Title was adopted by a
voice vote.
On November 15, 2001, the Senate Committee on Agriculture,
Nutrition, and Forestry met in open session to mark up the
Conservation, Commodity and Miscellaneous Titles of the new
federal farm bill. Those in attendance included: Senators
Harkin, Leahy, Conrad, Daschle, Baucus, Lincoln, Miller,
Stabenow, Nelson, Dayton, Wellstone, Lugar, Helms, Cochran,
McConnell, Roberts, Fitzgerald, Thomas, Allard, Hutchinson and
Crapo. As described by Chairman Harkin, the Conservation Title
recognizes that conservation is a cornerstone of sound farm
policy. The mark will greatly increase the commitment to help
agricultural producers and landowners conserve and protect
soil, water, air, and wildlife, especially on land that is in
production. The title increases funding for conservation on
land in production, while also expanding support for programs
that remove land from production. It establishes a new
incentive payment program, the Conservation Security Program,
which will both improve farm income and increase agricultural
conservation. Senator Lugar expressed his support for the title
and noted that he had worked closely on its drafting. The
Chairman moved to adopt the Conservation Title and the title
was adopted by a voice vote. The Committee then took up the
Commodity Title. As described by Chairman Harkin, the Commodity
Title is designed to provide a more dependable system of farm
income protection that reduces the need for ad hoc farm
assistance legislation year after year. The title addresses the
lack of income protection in the current policy while
maintaining planting flexibility. This legislation will
generally increase loan rates modestly, will continue fixed
direct payments, and it will create a new counter cyclical
program to respond to period of low prices. It also provides
for updating program-based acres and yields at the option of
the producer. The title creates a stronger system of income
protection for America's agricultural producers, one that
responds when prices are low, while reducing program costs when
the prices are better. This title fulfills the commitment to
farmers in rural communities to improve the farm income safety
net within the budget resources available. Senator Roberts
offered an amendment on behalf of himself and Senator Cochran
in the form of a substitute to replace the commodity title of
the bill. After discussion and debate, a roll call vote was
taken on the Cochran-Roberts amendment. The amendment failed by
a vote of 9 yeas and 11 noes. Those Senators voting for the
amendment included: Helms, Cochran, Roberts, Fitzgerald,
Thomas, Allard, Hutchinson, Crapo and McConnell; those Senators
voting against the amendment included: Leahy, Conrad, Daschle,
Baucus, Lincoln, Miller, Stabenow, Nelson, Dayton, Wellstone
and Harkin. Senator Lugar passed. Senator Dayton offered an
amendment which he has introduced previously as the Farm Income
Recovery Act. After discussion, the Dayton amendment failed by
a voice vote. Chairman Harkin moved to adopt the Commodity
Title of the farm bill. A roll call vote was taken and the
Title was passed by a vote of 12 yeas and 9 noes . Those voting
for the Title included: Senators Leahy, Conrad, Daschle,
Baucus, Lincoln, Miller, Stabenow, Nelson, Wellstone, Harkin
and Hutchinson; those voting against the Title included:
Senators Lugar, Helms, Cochran, McConnell, Roberts, Fitzgerald,
Thomas, Allard, Crapo and Dayton. The Commodity Title was
adopted. The committee then took up the Miscellaneous Title of
the new federal farm bill. Senator Wellstone offered an
amendment on country-of-origin labeling. The amendment provides
for country-of-origin labeling for beef, lamb, pork, fruits,
vegetables, peanuts and farm-raised catfish and shellfish. A
voice vote was taken on the Wellstone amendment and the
amendment passed. Senator Lugar called for a roll call vote and
the amendment passed by a vote of 11 ayes, 10 noes. Those
Senators voting for the amendment included: Leahy, Conrad,
Daschle, Baucus, Miller, Stabenow, Nelson, Dayton, Wellstone,
Harkin and Thomas; those Senators voting against the amendment
included: Lugar, Helms, Cochran, McConnell, Roberts,
Fitzgerald, Allard, Hutchinson, Crapo and Lincoln. Senator
Lincoln offered an amendment to authorize a consortium of land
grant colleges and universities to establish a network of
agricultural bioterrorism research facilities. The Lincoln
amendment was passed by a voice vote. Chairman Harkin moved the
adoption of the Miscellaneous Title. The Miscellaneous Title
was adopted by voice vote. The Chairman moved to report the
bill, as amended, to the Senate. The motion was agreed to by
voice vote. Without objection, Chairman Harkin declared that
the bill would be reported favorably and that the staff would
be authorized to make technical and conforming changes to the
bill. The Committee was adjourned.
VI. Regulatory Impact Statement
In compliance with paragraph 11(b) of rule XXVI of the
Standing Rules of the Senate, the following evaluation is made
concerning the regulatory impact of enacting this legislation:
Nearly every American will be affected in some way by the
passage of this legislation, a new farm bill for the next five
years. Moreover, the impact of the bill is overwhelmingly a
positive one. Not only is needed assistance provided to farmers
and ranchers across the country, but the federal price and
income support programs authorized in the bill are routinely
credited with having a significant and positive effect on the
production and availability of an abundant and affordable
supply of food and fiber for consumers. Regardless, the
Committee believes that the programs authorized by the bill
are, by and large, not regulatory in nature and thus the
Committee does not foresee significant regulatory impacts on
groups or classes of individuals and businesses affected.
This farm bill, like most farm bills, is a comprehensive,
multi-year authorization for most programs under the
jurisdiction of the United States Department of Agriculture
(USDA). The bill reauthorizes the farm price support, income
protection, credit, export promotion, and other programs that
directly and indirectly benefit farmers and ranchers across the
country. Participation in these programs is completely
voluntary. The bill also provides for, as well as simplifies
and improves, the nutritional safety net for many millions of
needy Americans through the reauthorization and strengthening
of the food stamp and other nutrition assistance programs of
the Department. All Americans will benefit from the improvement
in our Nation's soil and water quality through the
reauthorization and expansion of the voluntary conservation and
sustainable forestry programs made available to agricultural
producers, private forest owners, and others. The bill will
increase energy efficiency and encourage the production and use
of renewable and biomass energy by farmers, ranchers, and rural
small businesses. Millions of rural Americans will benefit from
the provisions of the rural development title which is designed
to make a significant difference in economic and community
development. The bill creates the rural business investment
program which could result in the creation of thousands of jobs
across rural America. The bill reauthorizes and extends the
agricultural research programs of USDA, which over the years
have been highly successful in, among other things, improving
the productivity of soils, addressing food safety concerns, and
minimizing the harmful impacts of plant diseases and insects.
Primarily, any regulations issued pursuant to the
implementation of the bill will prescribe and define the
programs authorized. Significant new regulatory burdens are not
expected to result from these types of regulations. In
addition, the Committee does not foresee a significant effect
on personal privacy, nor are significant new paperwork burdens
anticipated, particularly with respect to farmers and ranchers
who wish to participate in the voluntary credit assistance,
income support and conservation programs. Paperwork burdens
will be reduced by virtue of the program simplification
provisions included in the Nutrition title.
The Committee notes that several provisions of the bill
will result in regulations or burdens which might be viewed as
regulatory in nature. First, under title I, the national
counter-cyclical income support program for dairy producers
will require the establishment of a national program for dairy
farmers across the country. Analysis made available to the
Committee indicates that the program will significantly benefit
all but a very small number of very large dairy producers. The
program will result in many dairy farmers being able to stay in
production that otherwise would be forced out of business.
Under the bill, a new national minimum price per hundredweight
is established for raw milk used for class I (fluid) milk. The
minimum price would take effect whenever the federally set
class I price mover (higher of class III or IV price) falls
below $14.25 per hundredweight. During a period of low prices,
processors having sales of class I fluid milk would pay an
amount per hundredweight equal to the difference between the
$14.25 national minimum and the class I price mover. Funds
collected would ultimately be paid to dairy producers based on
an eligible production maximum and through the use of regional
supply management boards. Such boards would have authority to
manage the supply of milk through the use of bonuses or
incentives.
The bill also provides authority for the Secretary to
enforce a new requirement that retailers of certain covered
commodities including beef, lamb, pork, farm-raised fish,
perishable agricultural commodities, and peanuts must inform
consumers of the country of origin of the commodity. The
requirement would not apply to such commodities prepared, sold,
or served at a restaurant other food service establishment. The
provision authorizes the Secretary to require that retailers
maintain a verifiable record that will allow the Secretary to
ensure compliance with regulations issued under the provision.
Importantly, the bill provides considerable flexibility in the
method of notification that may be used. The information may be
provided by a number of means including, a label, stamp, mark,
placard, or any other clear and visible sign on the commodity
or on the package, display, holding unit, or bin containing the
commodity. Many retail food stores and outlets already provide
such information in order to meet consumer demand.
The bill amends the Animal Welfare Act to prohibit the
interstate or foreign movement of animals for the purpose of
participation in an animal fighting venture. The Secretary
would enforce this new provision as part of the enforcement
program for other provisions of the Animal Welfare Act. The
Committee does not have a current estimate of the number of
people or animals now being transported across state or
international boundaries for the purpose of fighting. However,
the Committee is aware of the intense concern among many
thousands of individuals who are active in animal health and
welfare issues who believe that such activities involving
animals should be prevented to the greatest extent possible.
Last, the bill amends the Packers and Stockyards Act of
1921 to address a concern with the movement of nonambulatory
livestock. The provision would prohibit the sale or other
movement of nonambulatory livestock that has not been humanely
euthanized. The provision would not apply to farms that are not
already under the jurisdiction of the Grain Inspection, Packers
and Stockyards Administration, or in the case of animals
receiving veterinary care. The provision will become effective
one year after date of enactment, and requires the Secretary to
issue regulations which will address the handling, treatment,
and disposition of nonambulatory livestock at marketing
facilities. The Committee believes that the provision will
affect only a very small number of individuals who choose to
buy, sell, or move nonambulatory livestock prior to humane
euthanization. The great majority of all persons involved in
livestock production, marketing, sales, purchasing, and
processing understand and follow good animal husbandry
practices and strongly believe in, and insist on, the humane
treatment of all livestock and other animals.
VII. Budgetary Impact Statement
In accordance with paragraph 11(a) of rule XXVI of the
Standing Rules of the Senate, the following letter has been
received from the Congressional Budget Office regarding the
budgetary impact of the bill:
U.S. Congress,
Congressional Budget Office,
Washington, DC,
December 5, 2001.
Hon. Tom Harkin,
Chairman, Committee on Agriculture, Nutrition, and Forestry,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: On November 28, 2001, the Congressional
Budget Office provided a summary of the estimated effects of S.
1731, the Agriculture, Conservation and Rural enhancement Act
of 2001. The enclosed cost estimate provides more detail on
CBO's estimates of the direct spending effects of S. 1731;
those estimated costs are unchanged from the numbers provided
on November 28. This estimate does not encompass the potential
effects of S. 1731 on spending subject to appropriation.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contacts are Jim Langley
(for federal costs), Marjorie Miller (for the state and local
impact, and Jean Talarico (for the private-sector impact).
Sincerely,
Dan L. Crippen, Director.
Enclosure.
CONGRESSIONAL BUDGET OFFICE COST ESTIMATE
S. 1731--Agriculture, Conservation and Rural Enhancement Act of 2001
Summary: S. 1731 would amend and extend the major farm
income support, land conservation, credit assistance, food
assistance, trade promotion, marketing assistance, and rural
development programs administered by the U.S. Department of
Agriculture (USDA). Enacting this legislation would increase
direct spending for these programs by $6.3 billion in 2002,
$38.4 billion over the 2002-2006 period, and $71.6 billion over
the 2002-2011 period. Increased spending would continue beyond
2011 for a total estimated cost of $73.4 billion. When combined
with estimated spending under current law, enactment of S. 1731
would bring total spending to $39.5 billion in 2002, $208.1
billion over the 2002-2006 period, and $411.9 billion over the
2002-2011 period. Because enactment of the bill would affect
direct spending, pay-as-you-go procedures would apply.
The bill also would authorize discretionary appropriations
for existing and new programs for research and education,
nutrition, trade promotion, rural development, credit
assistance, and forestry initiatives. CBO has not completed an
estimate of the costs of these provisions.
S. 1731 contains intergovernmental mandates as defined in
the Unfunded Mandates Reform Act (UMRA); those mandates include
preemptions of state laws and extensions of intergovernmental
mandates already in current law. The preemptions of state law
would impose minimal, if any, costs on state governments.
However, CBO cannot determine whether the total costs of other
intergovernmental mandates in the bill would exceed the
threshold established in UMRA ($56 million in 2001, adjusted
annually for inflation) because UMRA is unclear about how the
costs of extending an existing mandate should be estimated.
State, local, and tribal governments would receive funds
through some of the programs reauthorized by this bill and
probably would receive additional funds from newly authorized
programs. The bill would also give states additional
flexibility in determining eligibility for federal programs,
particularly food stamps. Any costs those governments might
incur as a result of participating in grant programs or
changing program options would be voluntary and would be more
than offset by the overall funding provided by the grants.
S. 1731 contains several private-sector mandates as defined
by UMRA. The bill would impose mandates on handlers of fluid
milk, importers of dairy products, retailers and suppliers of
certain commodities, and breeders of certain live animals. The
two most costly mandates would require some handlers of fluid
milk to pay certain producers higher prices for milk, and
retailers and suppliers of certain commodities to inform their
customers of the country of origin of those commodities. CBO
estimates that the direct costs of the mandate on milk handlers
would amount to about $1.5 billion a year starting in fiscal
year 2002, declining slightly in later years. CBO cannot
estimate independently the direct cost of the mandate requiring
country-of-origin labeling. Industry sources estimate that such
labeling could cost as much as $1 billion annually. The
aggregate direct costs of all the mandates in the bill would be
well in excess of the annual threshold established by UMRA
($113 million in 2001, adjusted annually for inflation).
Estimated cost to the Federal Government: The estimated
impact of the bill on direct spending is shown in Table 1.
Implementing S. 1731 also would affect spending subject to
appropriation action, but CBO has not completed an estimate of
those discretionary costs. The costs of this legislation fall
within budget functions 270 (energy), 300 (natural resources
and environment), 350 (agriculture), 450 (community and
regional development), and 600 (income security).
Basis of estimate: The bill would make several changes to
direct spending programs. For this estimate, CBO assumes that
S. 1731 will be enacted by the end of 2001, and thus would
affect farm programs for 2002 crops.
TABLE 1.--ESTIMATED IMPACT OF S. 1731 ON DIRECT SPENDING \1\
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
--------------------------------------------
2002 2003 2004 2005 2006
----------------------------------------------------------------------------------------------------------------
DIRECT SPENDING
Spending under current law: \2\
Estimated budget authority..................................... 33,520 34,014 34,273 34,333 34,027
Estimated outlays.............................................. 33,219 33,991 34,347 34,161 34,014
Proposed changes:
Estimated budget authority..................................... 7,349 9,913 6,487 9,586 7,530
Estimated outlays.............................................. 6,276 9,239 6,040 9,394 7,469
Spending under S. 1731:
Estimated budget authority..................................... 40,869 43,927 40,760 43,919 41,557
Estimated outlays.............................................. 39,495 43,230 40,387 43,555 41,483
----------------------------------------------------------------------------------------------------------------
\1\ The bill also would increase spending subject to appropriation, but CBO has not completed an estimate of
those costs.
\2\ The amounts shown as direct spending for 2002 are CBO's estimates of farm income support and related
spending under current law. The 2003-2006 amounts are CBO's current-law baseline levels, which assume that
assistance under the Federal Agricultural Improvement and Reform Act of 1996 (Public Law 104-127) is continued
under the terms of that law when it expires at the end of 2002.
Direct Spending: The bill would amend existing programs and
establish new programs to be administered by USDA. Under
current law, spending for the existing programs is governed, in
large part, by provisions of the Federal Agricultural
Improvement and Reform Act of 1996 (FAIR Act, Public Law 104-
127). The Congress has supplemented that spending with
additional farm income support payments over the last four
years. For example, Public Law 107-25, enacted in early August,
provided $5.5 billion of additional payments to farmers,
resulting in total direct spending for agriculture programs in
fiscal year 2001 of about $44 billion. CBO estimates that
spending under S. 1731 would be much higher than projected
under a simple (baseline) extension of the FAIR Act, but that
such spending would fall slightly below the total spending in
2001--averaging about $41.6 billion over the 2002-2006 period.
Relative to CBO's current-law baseline projections for
direct spending, we estimate that enacting this legislation
would cost $38.4 billion over the 2002-2006 period and $71.6
billion over the 2002-2011 period. The following paragraphs
detail those proposed changes, which are detailed in Table 2.
TABLE 2.--ESTIMATED CHANGES IN DIRECT SPENDING FOR S. 1731, BY TITLE
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
---------------------------------------------------------------------------------------------
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
--------------------------------------------------------------------------------------------------------------------------------------------------------
Title I--Commodity Programs:
Fixed, Decoupled Payments................................. 3,471 3,441 -248 -248 -2,079 -2,079 -2,079 -2,079 -2,079 -2,079
Counter-Cyclical Payments................................. 0 0 0 2,789 2,655 3,891 3,493 2,968 2,628 2,298
Market Assistance Loans................................... 1,251 2,656 2,508 2,415 2,437 2,264 1,929 1,540 1,208 1,103
Wool, Mohair, Honey, Lentils.............................. 39 46 46 46 46 45 44 43 42 41
Milk Price Support Program................................ 24 90 89 86 85 11 0 0 0 0
National Dairy Program.................................... 300 300 300 300 300 300 300 300 300 300
Sugar Program............................................. 50 140 21 17 26 32 52 59 50 83
Peanut Program............................................ 299 583 579 574 569 336 333 328 324 320
Commodity Purchase Program................................ 130 130 150 170 200 0 0 0 0 0
Hard white wheat payments................................. 0 0 13 13 14 0 0 0 0 0
Payment Limitations....................................... 60 60 60 60 60 60 60 60 60 60
---------------------------------------------------------------------------------------------
Subtotal--Title I..................................... 5,624 7,446 3,518 6,222 4,313 4,860 4,132 3,219 2,533 2,126
Title II--Conservation:
Conservation Security Program............................. 0 11 46 114 216 359 516 674 820 946
Conservation Reserve Program.............................. 50 158 185 246 291 294 304 316 290 283
Wetlands Reserve Program.................................. 151 260 297 306 250 101 18 0 0 0
Environmental Quality Incentives.......................... 92 373 599 760 861 915 954 993 1,018 1,030
Wildlife Habitat Incentives Program....................... 13 41 80 106 113 125 125 125 125 125
Farmland Protection Program............................... 7 42 118 172 203 224 240 248 250 250
Grassland Reserve Program................................. 0 1 5 13 25 38 46 46 40 36
---------------------------------------------------------------------------------------------
Subtotal--Title II.................................... 313 886 1,330 1,717 1,959 2,056 2,203 2,402 2,543 2,670
Title III--Trade.......................................... 81 130 167 191 215 243 249 249 249 249
Title IV--Nutrition....................................... 51 380 425 602 641 655 735 816 861 1,018
Title V--Credit........................................... 66 0 0 0 0 0 0 0 0 0
Title VI--Rural Development............................... 30 225 352 379 323 249 133 45 0 0
Title VII--Research and Related Items..................... 6 25 87 122 149 99 73 35 15 0
Title VIII--Forestry Initiatives.......................... 50 50 51 51 52 3 5 7 11 16
Title IX--Energy.......................................... 53 95 110 110 110 57 15 0 0 0
Title X--Miscellaneous Provisions......................... 2 2 0 0 -292 -302 -313 -322 -331 -341
---------------------------------------------------------------------------------------------
Total changes......................................... 6,276 9,239 6,040 9,394 7,469 7,920 7,232 6,451 5,881 5,738
--------------------------------------------------------------------------------------------------------------------------------------------------------
Title I: Commodity Programs
This title would reauthorize and amend the current
commodity support programs administered by USDA, and also would
implement new programs. CBO estimates that enactment of title I
would increase direct spending by $27.1 billion over the 2002-
2006 period, and by $44.0 billion over the 2002-2011 period.
Fixed, Decoupled Payments for Covered Commodities. The bill
would continue, at declining levels, USDA's fixed payments to
producers of grains and cotton, and would allow producers of
soybeans and other oilseeds to receive them. Under the bill,
farmers would have a one-time opportunity to update their
program acreage and yields--the historical averages used to
determine their level of program benefits. CBO estimates that
program costs would increase by $4.3 billion over the 2002-2006
period because of the cost of adding soybeans and oilseeds to
the program and allowing producers to update program acreage
and yields. After the first several years, however, declining
payment rates would outweigh these initial higher costs and
result in a savings relative to the baseline of $6.1 billion
over the 2002-2011 period.
Counter-Cyclical Payments for Covered Commodities. The bill
would authorize USDA to make automatic payments to producers to
offset low prices--known as counter-cyclical payments. Payments
under the program would begin in 2005. These payments would be
based in part on a farm's production history. The payment rate
would be the target price established in the bill less the
direct payment rate (also specified in the bill) and less the
crop price or the price-support loan rate if it is higher than
the crop price. CBO estimates this provision would cost $5.4
billion over the 2002-2006 period and $20.7 billion over the
2002-2011 period.
Marketing Assistance Loans for Covered Commodities. S. 1731
would authorize USDA to continue crop loans and marketing loan
programs for major row crops (grains, oilseeds, and cotton).
Loan rates would be higher than under current law for most of
these crops, but maximum loan rates for soybeans and other
oilseeds would decline. CBO estimates these provisions would
increase spending by $11.3 billion over the 2002-2006 period
and by $19.3 billion over the 2002-2011 period. Income and
incentives to grow oilseeds would decline under reduced loan
rates, resulting in lower spending for oilseed loans, loan
deficiency payments, and marketing loan gains. These lower
costs would be offset by increased costs for similar programs
for corn and other crops, as growers switched their planting
preferences away from soybeans and other oilseeds.
Marketing Assistance Loans for Wool, Mohair, Honey, and
Lentils. S. 1731 would establish a nonrecourse marketing
assistance loan program for producers of wool, mohair, honey,
dry peas, lentils, and chickpeas. Marketing loan gains and loan
deficiency payment provisions would apply to these commodities
and would be subject to a separate $75,000 payment limitation.
Over the 2002-2006 period CBO estimates that these new
provisions would cost $87 million for wool and mohair, $61
million for honey, and $75 million for dry peas, lentils, and
chickpeas. Over 10 years, those totals would rise to $187
million for wool and mohair, $101 million for honey, and $150
million for dry peas, lentils, and chick peas.
Milk Price Support Program. S. 1731 would extend the
current milk price support program through December 31, 2006,
at the current purchase price of $9.90 per hundredweight. Under
the bill, the recourse loan program for dairy processors would
be repealed. CBO estimates this provision would save $65
million over the next five years. CBO estimates that continuing
the dairy price support through 2006--when it expires--would
cost $439 million over the 2002-2006 period. Under the bill, we
estimate that the net cost of the milk price support program
would be $374 million over the next five years, and $385
million over the 10-year period.
National Milk Program. Section 132 would authorize the
Secretary of Agriculture to make counter-cyclical payments to
dairy producers. Payments would be based on a payment rate
equal to 25 percent of the difference between $14.25 and the
average price of class III milk (milk used for cheese). The
payment would be made on total monthly production of milk
(excluding milk for fluid use). Payments would be limited to
$300 million a year. CBO estimates that this limitation would
be binding each year, for a total cost of $1.5 billion over
five years and $3.0 billion over 10 years.
Section 132 also would require USDA to amend existing
federal regulations, known as milk marketing orders, to require
the use of a minimum target price for class I milk (that is
milk sold for fluid use) when calculating payments due to
producers. For the purpose of calculating payments due to
producers from milk handlers, this minimum target price for
class I milk would be $14.25 per hundredweight. Handlers that
are regulated by a milk marketing order could have to pay a
higher price (for fluid milk) that reflects a national average
difference between $14.25 and the prices that would otherwise
be paid each month under current law. In other words, the
prices received by milk producers would still vary by region,
but each region's price would be raised by an amount calculated
by USDA using the weighted average of milk prices across the
regions that are regulated by federal milk marketing orders.
(About 80 percent of fluid milk sold in the United States is
currently regulated by such orders. California, a handful of
other states, and portions of some other states are not
currently subject to such federal regulation.) The transactions
between milk handlers and producers that occur under milk
marketing orders are part of a regulatory program and are thus
not accounted for in the budget.
Sugar Program. The bill would extend and amend USDA's sugar
program by removing the marketing assessment currently paid by
growers, lowering the interest rate charged on price-support
loans, and adding a storage facility loan. In addition, the
bill would require the Secretary to pay producers loan benefits
in cases where a processor cannot provide producers with loan
benefits because of bankruptcy or is otherwise insolvent. We
estimate these amendments would increase program costs by about
$600 million over the next 10 years. Moreover, the bill would
provide new authority to pay farmers with government-owned
stocks of sugar (payment-in-kind) for idling acreage, and the
authority to use marketing allotments to control supply if
sugar imports decline in the future. We estimate these new,
additional authorities would reduce the cost of the sugar
program relative to current law, but that net spending for the
sugar program would increase by $254 million over the 2002-2006
period and $530 million over the 2002-2011 period.
Peanuts. S. 1731 would make substantial changes to USDA's
peanut program. Under the bill, CBO estimates that the peanut
program would cost $2.6 billion over the 2002-2006 period and
$4.2 billion over the 2002-2011 period. Peanut marketing quotas
and support rates for peanuts produced within the marketing
quotas would be eliminated. Instead, peanut producers would
become eligible for direct payments, counter-cyclical payments,
and marketing assistance loan benefits. Under the legislation,
a single, nonrecourse marketing assistance loan rate would
apply to all peanut production that is lower than the current
rate. The bill would compensate some peanut growers for the
loss of asset value due to the elimination of marketing quotas.
Over the next five years, CBO estimates that the new peanut
provisions would cost $315 million for direct payments, $578
million for counter-cyclical payments, $531 million for
marketing assistance loans, and $1,180 million for compensation
to peanut quota holders. Over the next 10 years, CBO estimates
that these provisions would cost $625 million for direct
payments, $1,277 million for counter-cyclical payments, and
$1,163 million for marketing assistance loans, with no
additional compensation to peanut quota holders after 2006.
Commodity Purchases. Section 163 provides $780 million over
the 2002-2006 period to purchase certain speciality crops.
Purchases would be made on the open market in an effort to
support the prices of those commodities.
Hard White Wheat Payments. Section 164 would provide
funding of $40 million over crop years 2003 through 2005 to
establish an incentive payment program to encourage production
of hard white winter wheat. CBO estimates the provision would
increase spending by $40 million over the 2002-2006 period,
with no additional cost after 2006.
Payment Limits. Section 165 would establish a combined
payment limit of $100,000 for direct and counter-cyclical
payments. The current payment limit is $40,000 for direct
payments. Because counter-cyclical payments would be a new
provision no payment limitation currently applies. Based on
information from USDA, CBO estimates that a $100,000 payment
limit would increase payments to producers by $60 million per
year, or $300 million over the 2002-2006 period and $600
million over the 2002-2011 period.
Title II: Conservation Programs
This title would reauthorize and expand land conservation
programs administered by USDA. CBO estimates these provisions
would cost $6.2 billion over the 2002-2006 period, and $18.1
billion over the 2002-2011 period. (Spending would continue for
a number of years after 2011, for a total estimated cost of
$20.5 billion.)
Changes to Existing Programs. The bill would increase the
maximum acreage enrollment in the Conservation Reserve Program
to 40 million acres from the current cap of 36.4 million acres,
and would authorize incentive payments for enrollment of acres
under the continuous enrollment provisions and under the
Conservation Reserve Enhancement Program. We estimate that
thesechanges would cost $930 million over the next five years
and $2.4 billion over the 2002-2011 period.
Acreage enrollment in the Wetlands Reserve Program (WRP)
would expand by up to 250,000 acres per fiscal year under the
bill, for a total acreage enrollment of 2.325 million acres by
2011. We estimate that the WRP provisions would cost $1.3
billion over the next five years and $1.4 billion over the
2002-2011 period.
Funding for the Environmental Quality Incentives Program
(EQIP) would be increased by $300 million in 2002 and would
rise to an increase of $1.05 billion by 2011. Under the bill,
CBO estimates EQIP would cost $2.7 billion over the next five
years and $7.6 billion over the 2002-2011 period. (Additional
spending would occur after 2011.) Included in the EQIP total is
$100 million per year for conservation innovation grants. The
bill also would accelerate the timing of EQIP payments to
increase outlays by $165 million over the 10-year period.
In addition, the bill would increase funding for the
Wildlife Habitat Incentives Program by an average of $98
million a year, and for the Farmland Protection Program by an
average of $175 million a year. CBO estimates that the total
cost for these amendments would be $895 million over the 2002-
2006 period and $2.7 billion over the 2002-2011 period.
New Conservation Program. S. 1731 would establish a
conservation security program for producers to receive payments
from the Commodity Credit Corporation for implementing certain
conservation practices. Payments would be based on a percentage
of the average rental rate for farmland in their county,
depending on the level of conservation practice implemented.
The program establishes three tiers of payments, with higher
payments under each successive tier to compensate for higher
requirements for conservation practices. Eligible producers
would have to develop a conservation security contract
describing conservation practices on their land, and have the
contract approved by the Secretary before annual incentive
payments were paid.
CBO estimates that participation in such a new and
potentially wide-ranging program would likely be slow in the
beginning as producers obtained information about the program
and developed their conservation plans. Hence, we expect that
outlays under the new Farmland Protection program would be
relatively low in the first five years, but would rise sharply
in later years as more acres are enrolled. CBO estimates this
program would cost $387 million over the 2002-2006 period and
$3.7 billion over the 2002-2011 period.
S. 1731 would also establish the Grasslands Reserve
program. This program would authorize the Secretary of
Agriculture to enroll up to two million acres in permanent and
30-year easements. CBO estimates that the program would cost
$44 million over the 2002-2006 period and $250 million over the
2002-2011 period.
Title III: Trade Programs
Title III would extend USDA's authority to administer
programs to promote trade through 2006, and would increase
funding for the Market Access Program, the Foreign Market
Development Program, and the Food for Progress Program. The
bill also would authorize the establishment within the Food for
Progress Program of an International Food for Education and
Child Nutrition Program. Title III would specify funding levels
for most of these trade programs through 2006. CBO estimates
that enacting title III would cost $784 million over the next
five years and $2.0 billion over the 2002-2011 period.
The bill would gradually increase annual funding for the
Market Access Program from $90 million to $190 million, and
would increase annual funding for the Foreign Market
Development Cooperator Program from $27.5 million to $42.5
million. The bill would cap non-commodity expenditures under
the Food for Progress Program at $80 million a year. Those
provisions account for most of the cost of title III.
Title III also would authorize the establishment of the
International Food for Education and Child Nutrition Program.
Annual funding for the new program would be capped at the
overall funding level provided for the Food for Progress
Program. Finally, title III would provide annual funding for
five years to carry out an export assistance program for
products developed through biotechnology. We estimate this
provision would cost $145 million over the next 10 years.
Title IV: Nutrition Programs
Title IV would reauthorize the Food Stamp and related
nutrition programs through fiscal year 2006. In addition, it
would make several changes in those nutrition programs. Most of
these changes would be effective September 1, 2002, although
states could opt to delay implementation until October 1, 2002.
CBO estimates that the bill would increase direct spending by
$51 million in 2002 and by $6.2 billion over the 2002-2011
period (see Table 3).
TABLE 3.--ESTIMATED CHANGES IN DIRECT SPENDING FOR FOOD STAMPS AND OTHER NUTRITION PROGRAMS (TITLE IV)
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
---------------------------------------------------------------------------------
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
----------------------------------------------------------------------------------------------------------------
CHANGES IN DIRECT SPENDING
Section 412, Definition of
income:
Estimated budget authority \1\ 3 6 6 6 7 7 7 7 8
Estimated outlays......... \1\ 3 6 6 6 7 7 7 7 8
Section 413, Standard
deduction:
Estimated budget authority \1\ 55 70 85 100 110 180 250 275 420
Estimated outlays......... \1\ 55 70 85 100 110 180 250 275 420
Section 415, Standard utility
allowance:
Estimated budget authority 2 50 50 55 55 60 60 60 65 65
Estimated outlays......... 2 50 50 55 55 60 60 60 65 65
Section 417, Determination of
deductions:
Estimated budget authority \2\ \2\ \2\ \2\ \2\ \2\ \2\ \2\ \2\ \2\
Estimated outlays......... \2\ \2\ \2\ \2\ \2\ \2\ \2\ \2\ \2\ \2\
Section 418, Definition of
resources:
Estimated budget authority \1\ 5 15 20 20 20 25 25 25 25
Estimated outlays......... \1\ 5 15 20 20 20 25 25 25 25
Section 420, State option for
reporting requirements:
Estimated budget authority 2 25 30 35 35 35 35 35 40 40
Estimated outlays......... 2 25 30 35 35 35 35 35 40 40
Section 421, Time limit for
adults without dependents:
Estimated budget authority \1\ 55 60 90 90 90 95 95 100 100
Estimated outlays......... \1\ 55 60 90 90 90 95 95 100 100
Section 422, Access to
electronic benefits:
Estimated budget authority \1\ \1\ 1 \1\ \1\ \1\ \1\ \1\ \1\ \1\
Estimated outlays......... \1\ \1\ 1 \1\ \1\ \1\ \1\ \1\ \1\ \1\
Section 423, Cost neutrality
of electronic benefit
systems:
Estimated budget authority \1\ 1 1 1 1 1 1 1 1 1
Estimated outlays......... \1\ 1 1 1 1 1 1 1 1 1
Section 426, Determination of
continuing eligibility:
Estimated budget authority \1\ 5 5 5 5 5 5 5 5 5
Estimated outlays......... \1\ 5 5 5 5 5 5 5 5 5
Section 428, Transitional food
stamps:
Estimated budget authority 5 90 120 190 195 200 205 210 215 225
Estimated outlays......... 5 90 120 190 195 200 205 210 215 225
Section 430, Quality control
systems:
Estimated budget authority -28 -58 -59 -61 -62 -63 -65 -66 -67 -69
Estimated outlays......... -28 -58 -59 -61 -62 -63 -65 -66 -67 -69
Section 432, Bonus payments:
Estimated budget authority 0 30 30 30 30 30 30 30 30 30
Estimated outlays......... 0 30 30 30 30 30 30 30 30 30
Section 433, Employment and
training:
Estimated budget authority -197 -187 -45 -42 -40 -38 -37 -35 -33 -32
Estimated outlays......... 4 3 -1 -4 -8 -12 -16 -20 -24 -29
Section 437, Access and
outreach pilot projects:
Estimated budget authority 0 3 \1\ \1\ \1\ \1\ 0 0 0 0
Estimated outlays......... 0 \1\ 1 1 1 \1\ 0 0 0 0
Section 438, Consolidated
block grants:
Estimated budget authority 0 6 6 6 6 6 6 6 7 7
Estimated outlays......... 0 5 6 6 6 6 6 6 7 7
Section 439, Community food
projects:
Estimated budget authority 0 3 3 3 3 0 0 0 0 0
Estimated outlays......... 0 2 3 3 3 1 0 0 0 0
Section 440, TEFAP
commodities:
Estimated budget authority 10 10 10 10 10 10 10 10 10 10
Estimated outlays......... 6 12 10 10 10 10 10 10 10 10
Section 443, Vitamin and
mineral supplements:
Estimated budget authority \1\ 3 \1\ \1\ \1\ \1\ \1\ \1\ \1\ \1\
Estimated outlays......... \1\ 1 1 1 \1\ \1\ \1\ \1\ \1\ \1\
Section 452, Restoration of
benefits to certain aliens:
Estimated budget authority \1\ 25 65 110 135 145 150 160 165 170
Estimated outlays......... \1\ 25 65 110 135 145 150 160 165 170
Effect in TANF program:
Estimated budget authority 0 0 0 0 0 0 0 0 0 0
Estimated outlays......... 0 \1\ -5 1 1 1 1 1 0 0
Section 453, Commodity
purchases:
Estimated budget authority 50 50 0 0 0 0 0 0 0
Estimated outlays......... 50 50 0 0 0 0 0 0 0 0
Section 456, Senior farmers'
market nutrition program:
Estimated budget authority 15 15 15 15 15 0 0 0 0 0
Estimated outlays......... 10 15 15 15 15 5 0 0 0 0
Section 457, Fruit and
vegetable pilot program:
Estimated budget authority 0 0 0 0 0 0 0 0 0 0
Estimated outlays......... \1\ 5 \1\ 0 0 0 0 0 0 0
Interactions:
Estimated budget authority \1\ 1 1 3 3 4 6 7 7 10
Estimated outlays......... \1\ 1 1 3 3 4 6 7 7 10
Total changes in direct
spending, Title IV:..........
Estimated budget authority -141 190 384 561 607 622 713 800 852 1,015
Estimated outlays......... 51 380 425 602 641 655 735 816 861 1,018
----------------------------------------------------------------------------------------------------------------
\1\ Less than $500,000.
\2\ CBO cannot estimate, but we expect the annual costs to be small.
Notes. Details may not sum to totals because of rounding.
TEFAP = The Emergency Food Assistance Program.
TANF = Temporary Assistance for Needy Families.
Reauthorization of the Food Stamp Program. Section 434
would reauthorize the Food Stamp program through fiscal year
2006. Because it is assumed to continue in CBO's baseline after
it expires at the end of 2002, CBO would not estimate this
reauthorization to result in additional federal costs.
Income Definition. Section 412 would allow a state to
exclude from gross income in the Food Stamp program any
educational loans or other educational assistance that the
state is required to exclude in Medicaid. It would also allow a
state to exclude the types of income that it excludes in
Medicaid or Temporary Assistance for Needy Families (TANF). CBO
estimates that this provision would increase spending by $57
million over the next 10 years. CBO used Food Stamp Quality
Control (QC) data to estimate the change in benefits if
educational assistance that is counted under current law were
to be excluded from income in determining benefits. CBO
estimates about 5,000 households would be affected with an
average benefit increase of $68 per month.
CBO also added costs for excluding a small portion of
unearned income. States have flexibility to determine what is
excluded from the definition of income in Medicaid and TANF, so
the rules vary by state, but most differences are minor. CBO
assumes that 90 percent of states would exercise the option to
exclude income as allowed under this section.
Standard Deduction. Section 413 would set the amount of the
standard deduction as a percentage of the net income threshold
in each fiscal year. Under current law, all households receive
the same standard deduction from gross income: $134 in the 48
states and the District of Columbia. (Alaska, Hawaii, Guam, and
the U.S. Virgin Islands have different standard deductions.)
This bill would set the standard at 8 percent of the net income
threshold by household size for fiscal years 2002 through 2007,
and then incrementally increase the percentage up to 9 percent
by 2011. Smaller households would be guaranteed the current-law
standard deduction, and no household could receive a standard
deduction that is higher than the applicable percentage of the
net income threshold for a household of six people.
Under this section, some households would receive higher
Food Stamp benefits than under current law, because less of
these households' income would be considered available for
purchasing food. Most households of 5 people or more would
receive higher benefits when the standard is set at 8 percent
of the net income threshold. Using QC data, CBO estimates over
700,000 households would receive an average increase in
benefits of more than $6 per month for total costs of $55
million in 2003. The 10-year costs would total about $1.5
billion. These costs and the number of affected households
would increase over time as a result of subsequent increases in
the standard deduction and the projected growth in the eligible
population.
Standard Utility Allowance. Section 415 would allow states
that choose to make the use of a standard utility allowance
(SUA) mandatory to use the full SUA for households that share
utility expenses with individuals not in the Food Stamp unit
and for public housing residents with central meters who pay
for excess utility expenses. The SUA is used along with rent or
mortgage payments to determine the amount of the deduction from
gross income of excess shelter expenses. Under current law,
states can choose to make the use of the SUA mandatory for most
households with utility expenses. States accounting for almost
25 percent of total benefits have chosen the mandatory SUA. In
other states, households can choose to use either the SUA or
actual utility costs.
CBO estimates this provision would cost $50 million in 2003
and $522 million over the 10-year period. The costs to end
proration of shared utility expenses would be $45 million in
2003, which CBO estimated using QC data on households living
with non-food stamp unit members and administrative data on the
value of states' SUAs. This cost also includes savings from
about half the remaining states adopting a mandatory SUA. A
mandatory SUA would result in some savings because those
households with actual utility costs that are higher than the
SUA would have lower benefits when required to take the SUA.
Finally, CBO estimates a cost of $5 million a year for using
the full SUA for households residing in public housing and
charged for excess utility expenses.
Resource Definition. Section 418 would allow states to
exclude from the definition of resources those types of
resources they do not consider when determining eligibility for
cash assistance under TANF or for Medicaid, although states
would not be allowed to exclude resources that are readily
accessible to the household, such as cash or assets in certain
financial accounts, or licensed vehicles. Under section 1931 of
the Social Security Act (which is the section with which states
would be allowed to conform their Food Stamp resources rules),
states accounting for about 17 percent of Food Stamp benefits
have chosen to disregard all assets in determining eligibility
for Medicaid. CBO assumed that most of these states would
choose to exclude the types of resources this section allows
them to exclude. Using data from the Survey of Income and
Program Participation (SIPP), CBO estimates an additional
10,000 households would participate once the provision is fully
phased in by 2005 with an average monthly benefit of $150. This
section would increase costs by $20million in 2005 and $180
million over the 10-year period.
Reporting Requirements. Section 420 would provide states
with additional options for how households report changes in
their circumstances. Under final regulations released in
November 2000, states have the option to allow households with
earned income to report every six months, unless the
household's income exceeds the gross income threshold for
eligibility. This section would allow states to implement this
option for all households.
CBO estimates this reporting option would result in states
missing a net decrease of about one-half of one percent of
total benefits. Using data from the SIPP, CBO examined changes
in Food Stamp households' income over a six-month period to
estimate changes that households would not be required to
report under the new option. These changes were adjusted for
households' reporting behavior, the number of households that
would exceed the gross income limit and become ineligible, and
the costs of the reporting option under current regulations.
CBO assumes that states with 45 percent of benefits would
eventually take this option, given other reporting options that
are available such as quarterly reporting, for costs of $25
million in 2003 and $312 million over the 2002-2011 period.
A related provision--Section 417--would allow states to
disregard certain changes in deductions from gross income
during a household's certification period. Under current law, a
state is required to adjust benefits in response to a
household's report of changes in spending that affect the
amount of deductions. CBO cannot estimate the costs of this
option because there are not sufficient data to assess how the
spending of Food Stamp recipients on items such as child care,
medical care, and child support payments fluctuates over the
course of several months. However, CBO expects that the costs
of this provision could be several million dollars a year, but
such costs should be significantly lower than the annual $30
million to $40 million costs of section 420.
Time Limit for Adults without Dependents. Section 421 would
extend the time limit for participation by able-bodied adults
without dependents (ABAWDs) in the Food Stamp program. Under
current law, individuals between the ages of 18 and 50 who are
not disabled and do not have dependents can participate in the
program for only three months out of 36 months, unless they are
working or participating in a suitable work activity. The bill
would change the time limit for this group to six out of 24
months when not engaged in work or a work activity. CBO
estimates an additional 55,000 individuals, on average,
eventually would participate with average monthly benefits of
$130, for costs of $775 million over the 10-year period. This
estimate is based on SIPP data on the work participation of
this group prior to enactment of the time limit in Public Law
104-193, the Personal Responsibility and Work Opportunities
Reconciliation Act of 1996 (PRWORA). We adjusted the results
from the SIPP data for individuals who would be eligible due to
waivers, discretionary exemptions, or participation in
employment and training programs under current law.
Cost Neutrality for Electronic Benefit Transfer Systems.
Section 423 would eliminate the requirement that a state's
electronic benefit transfer (EBT) system be cost neutral
relative to the costs of the state's coupon issuance system.
Based on information from USDA on actual cost overruns and
contract negotiations for states, CBO estimates annual costs of
$1 million beginning in fiscal year 2003.
Determinations of Continuing Eligibility. Section 426 would
allow states to redetermine the eligibility of current
participants on a case-by-case basis, instead of setting
specific certification periods. States would be required to
determine eligibility no less than every 12 months (or 24
months for households in which all adult members are elderly or
disabled), which are the same limits for current-law
certification periods. Some households may receive benefits for
a longer time period than under current law, if a state failed
to conduct a review.
Using information from the Food and Nutrition Service (FNS)
on cases in which a state fails to act on a recertification and
those cases in which the household is no longer eligible for
benefits, CBO estimates that fewer than 500 households each
month would receive benefits for an additional 4.5 months, on
average, resulting in costs of $5 million each year.
Transitional Food Stamps. Section 428 would allow states to
provide up to six months of Food Stamp benefits to households
leaving the TANF program. These benefits would be set at the
level received in the month prior to leaving welfare, adjusted
for the loss of cash assistance. Under final regulations
released in November 2000, states have the option to provide
transitional benefits to these households for up to three
months. This section would allow states to provide transitional
benefits for an additional three months, even if the
transitional benefit period extends beyond the household's Food
Stamp certification period.
Based on the number of active cases and TANF cases closed
in 1999, CBO estimates there will be about 1.6 million closed
cases annually. We adjusted this number for households who
would continue to be Food Stamp recipients under current law,
for households who would return to TANF during the transitional
period, and for households who would not be eligible because of
sanctions or noncooperation with welfare rules. These
adjustments are based on various studies of people who leave
welfare. CBO estimates about 35,000 TANF households, on
average, could potentially be eligible for transitional
benefits, and that states accounting for about half these cases
would choose this option by 2005. These households would
receive an additional three months of benefits relative to
current law with average benefits of about $270 per month in
2003, for costs of $90 million in 2003 and about $1.7 billion
over the 10-year period.
Quality Control System and Bonus Payments. Section 430
would revise the system under which USDA measures payment
accuracy and section 432 would set up a new system of bonus
payments for performance. Under current law, USDA measures the
accuracy of benefit determinations and computes payment error
rates for every state. States that have payment error rates
higher than the national performance measure are subject to
sanctions. Most states subject to sanction enter into
agreements with USDA to reinvest these liabilities into program
improvements. The bill would revise the QC system to sanction
states that have error rates with a 95 percent statistical
probability of being one percentage point greater than the
national average for three years in a row. Based on information
from USDA, CBO assumes that USDA would continue to work with
states to reinvestliabilities into program improvements so
there would be no change in collections from sanctions.
The current system also provides enhanced administrative
funding for states with a payment error rate below 6 percent.
The bill would eliminate this system beginning with fiscal year
2002 error rates, and cut the payments in half for enhanced
payments made in 2002 for fiscal year 2001 errors. Based on
actual enhanced funding payments for fiscal year 2000 error
rates, CBO estimates savings of $28 million in fiscal year 2002
and total savings of $598 million over the 10-year period.
Section 432 would create a new system of performance
measures and bonus payments beginning in fiscal year 2003. Five
new performance measures would be created and payments of $6
million for each measure would be given out to states with the
best or most improved performance, increasing spending by $30
million each year.
Funding for Employment and Training Program. Under current
law, states receive funding for employment and training
programs that are 100 percent federally financed--$165 million
in fiscal year 2002. States are required to spend 80 percent of
these funds on able-bodied adults without dependents, with
maximum per slot reimbursement rates and a maintenance of
effort (MOE) requirement for state spending. Section 433 would
reduce budget authority to $115 million each year and rescind
all unobligated funds carried over from pre-2002 budget
authority. It also would end the MOE requirement, the limits on
slot reimbursement rates, and the requirement to spend at least
80 percent of funds on able-bodied adults. Of the $115 million
each year, $90 million would be allocated among all states, and
the additional $25 million would be available to states that
spend all of their initial allocation and pledge to serve all
ABAWDs who would otherwise lose eligibility for the Food Stamp
program.
CBO examined the pattern of spending by states in the
employment and training program. For states likely to spend
less than their estimated allocation of the base funding amount
($90 million), CBO assumed these states would increase spending
of the 100 percent federal funds because of the easing of
restrictions for spending of those funds, and shift spending
from matched funding to full federal funding. For states likely
to spend more than their allocation, CBO assumed these states
would make up about half of the cut in resources by increasing
their use of the 50 percent matched funding. These assumptions
result in net savings of $210 million over the 10-year period.
This section would also raise the limit on reimbursement of
participant expenses to $50 per month from the current $25
limit. Based on the amount spent in 2000 on these expenses, CBO
estimates the federal share of the higher reimbursement limit
would total about $10 million annually for costs of $103
million over the 2002-2011 period. This leads to a net cost of
$4 million in 2002 and net savings of $107 million over the
2002-2011 period for section 433.
Other Changes in the Food Stamp Program. This title would
make several other changes in the Food Stamp program. Section
422 would require states to keep electronic benefits accessible
for at least six months after a household last accessed its
account. Section 437 would provide $3 million over the 2003-
2005 period for grants to states for pilot programs on
improving access to andoutreach for the Food Stamp program.
Finally, section 443 would allow Food Stamp benefits to be used to
purchase vitamin and mineral supplements and would authorize $3 million
for an evaluation of this new use of benefits. CBO estimates the costs
of these provisions would total $10 million over the 2002-2011 period.
Related Nutrition Programs in the Food Stamp Act. Title IV
would reauthorize and amend several other nutrition programs
included in the Food Stamp Act. Section 438 would combine the
nutrition assistance programs for Puerto Rico and American
Samoa into one block grant that would be adjusted each year by
the change in the Thrifty Food Plan. Under current law, the
nutrition assistance program for American Samoa is authorized
at $5.3 million each year through 2002. Section 439 would
reauthorize assistance for community food projects at $2.5
million each year through 2006. Section 440 would authorize
$110 million each year for the purchase of commodities for the
Emergency Food Assistance program, with $10 million set aside
for the costs associated with distributing such commodities.
Under current law, $100 million is authorized each year through
2006. These sections would increase spending by $6 million in
2002 and by a total of $163 million over the 10-year period.
Restoration of Eligibility for Certain Legal Aliens.
Section 452 would restore Food Stamp eligibility for certain
categories of qualified aliens. PRWORA made most aliens
ineligible for food stamps until naturalization, except for
refugees or asylees during their first five years in the United
States, aliens who have 40 quarters of employment covered by
Social Security, or aliens who are veterans or active duty
military personnel. Public Law 105-185, the Agricultural
Research, Extension, and Education Reform Act of 1998, restored
eligibility to refugees and asylees in their first seven years
in the country, and children, elderly, or disabled aliens who
resided in the United States as of August 22, 1996.
The bill would restore eligibility to all qualified alien
children under 18, change the work requirement from 40 quarters
to 16 quarters of covered employment, lift the time restriction
for refugees and asylees, and restore eligibility to all
qualified disabled aliens. This section would be effective
September 1, 2002, (or at state option October 1, 2002), except
the provision to restore eligibility to children would be
effective beginning in fiscal year 2004. Based on fiscal year
1996 QC data, adjusted for current Food Stamp rules, CBO
estimates that this section, when fully phased in, would
increase participation by 150,000 participants in fiscal year
2006 and cost $25 million in 2003 and $1.1 billion over the
2002-2011 period.
Minimum Commodity Assistance in the School Lunch Program.
USDA provides both cash reimbursement and commodity assistance
for each meal served under the National School Lunch program,
and a minimum of 12 percent of the total assistance must be in
the form of commodities. Section 453 would reverse a
requirement that the value of bonus commodities (those
purchased by USDA to remove surpluses or support prices, and
then donated to the school lunch program) be included in
calculating this minimum value for fiscal years 2002 and 2003.
CBO expects that $50 million of bonus commodities would be
provided and would be counted toward the requirement each year
under current law. Therefore, the Secretary of Agriculture
would have to purchase an additional $50 million to meet the
requirement each year, for total costs of $100 million over the
two-year period.
Other Nutrition Programs. Section 456 would establish a
senior farmers' market nutrition program, funded at $15 million
each year over the 2002-2006 period. This program would
continue a pilot program established in 2001 to provide access
to local produce for low-income seniors. This section would
increase spending by $10 million in 2002 and by $75 million
over the 10-year period.
Section 457 would require the Secretary to use funds
available under section 32 (funds for strengthening markets,
income, and supply) to operate a pilot program to provide free
fresh fruits and vegetables in schools in four states and on
one Indian reservation for the 2003 school year. Using
information from FNS and the Bureau of Labor Statistics on the
prices of fruits and vegetables that are likely to appeal to
children and on average school enrollment from the National
Center for Education Statistics, CBO estimates this program
would increase spending by $5 million.
Title V: Credit Programs
Under current law, USDA may provide certain loan-servicing
benefits to delinquent farm credit borrowers, including
deferral and writeoff of scheduled payments. Borrowers whose
debt is reduced under these servicing procedures are subject to
shared appreciation agreements that require a portion of the
reduced debt be repaid to USDA from appreciation in the value
of the property over a 10-year period. Under procedures
established by the Federal Credit Reform Act of 1990, the
subsidy cost of a direct loan is the estimated long-term cost
to the government, calculated on a net present value basis. If
legislation modifies the cost of outstanding loans, the change
in subsidy cost is recorded the year the legislation is
enacted. Section 531 would allow the borrower to agree to a
conservation easement on the property in lieu of repayment
obligations under the shared appreciation agreement. CBO
estimates that implementing the new program would reduce
receipts under the shared appreciation agreements. CBO
estimates the cost of the provision--the present value of
reduced receipts--would total $66 million, which would be
recorded as a loan modification in fiscal year 2002.
Title VI: Rural Development Programs
CBO estimates that enacting title VI of S. 1731 would
result in direct spending of $1.7 billion over the 2002-2011
period, with most of that spending to occur over the next five
years. Section 602 would establish the Rural Business
Investment Program (RBIP) to provide federal loan guarantees on
debentures to qualified venture capital corporations that
invest in small enterprises in rural communities. The bill
would authorize USDA to issue up to $350 million of loan
guarantees. Based on the experience of similar loan guarantee
programs administered by the Small Business Administration, CBO
estimates that the subsidy cost to guarantee $350 million in
loans under the RBIP program would be about $70 million over
the 2002-2006 period.
Section 602 also would provide $50 million for grants to
Rural Business Investment Companies to provide assistance to
small enterprises financed by these entities. CBO estimates the
cost of the grants would be $50 million over the 2002-2006
period.
Section 603 would provide funding for all pending
applications for rural water treatment grant and loan programs
under the Rural Community Advancement Program that cannot be
funded through the fiscal year 2002 appropriations for such
programs. Based on information from USDA, CBO estimates that
this provision would cost $454 million over the 2002-2007
period.
In addition, title VI would provide funding for several
rural development initiatives, including $377 million for
value-added agricultural product market development grants,
$500 million for grants to enhance broadband access in rural
areas, $130 million for grants to rural firefighters and
emergency personnel for training, $50 million for assistance to
rural entrepreneurs and micro enterprises, and $113 million for
the Rural Endowment Program established under this title.
Title VII: Research and Related Items
This title would increase research spending for the
Initiative for Future Agriculture and Food Systems by $284
million over the 2002-2006 period and $460 million over the
2002-2011 period. This initiative would award funding to
research projects that address critical emerging issues related
to future food production, environmental protection, farm
income, or alternative uses of agricultural products.
S. 1731 also would establish two new research programs. The
bill would provide both the Beginning Farmer and Rancher
Development Program and the Rural Policy Research Program with
$15 million a year for five years. CBO estimates these two new
research programs would cost $106 million over the 2002-2006
period and $150 million over the 2002-2011 period. Finally,
section 723 would authorize the Secretary to use any proceeds
from the sale of federal research facilities and equipment for
infrastructure security. Since such proceeds would, in general,
be deposited in the Treasury, this new authority for the
Secretary to use these funds would increase direct spending.
Based on information from USDA, however, CBO estimates that
additional spending under this provision would be less than
$500,000 a year.
Title VIII: Forestry Initiatives
This title would provide $48 million a year over the 2002-
2006 period for a new program to provide assistance to owners
of private nonindustrial forest lands. Based on information
from USDA, we estimate that the proposed program would cost
$240 million over the 2002-2011 period. Title VIII also would
establish a new competitive grant program to support forestry
practices of nonprofit organizations. The bill would provide $2
million a year for that program, for a cost of $10 million over
the 2002-2006 period.
This title also would allow USDA and the Department of the
Interior to use long-term stewardship contracts to implement
projects to remove hazardous fuels (overly dense forest
vegetation) from certain federal lands. Under such contracts,
the agencies could retain and spend any receipts generated from
such contracts to implement additional projects. Based on
information from the Forest Service, we estimate that the net
increase in direct spending from this provision would total $46
million over the 2002-2011 period. That estimate assumes that,
in some cases, the agency would use stewardship contracts to
implement projects that otherwise would have been completed
using the agency's existing authorities.
Title IX: Energy Programs
This title would provide funding for several renewable
energy programs. Specifically, the title would provide $165
million over the next 10 years for loans and grants to
encourage small businesses and farmers to develop and use
renewable energy. In addition, it would provide $25 million to
study hydrogen and fuel cell technology and $75 million for
research and development into the use of biomass products for
fuel. It would provide an additional $45 million for rural
electrification loans. Overall, CBO estimates that enacting
title IX would cost $478 million over the 2002-2006 period, and
$550 million over the 2002-2011 period.
Title X: Miscellaneous Provisions
Currently, crop insurance coverage is available in 5
percent increments (50, 55, 60, 65, 70, 75, 80, and 85 percent
of expected yields). Beginning in 2006, producers will be able
to select coverage levels in 1 percent increments. The
availability of coverage in 1 percent increments, known as
continuous coverage, will increase the cost of the crop
insurance program because in some cases a slight reduction in
the coverage level can result in a substantial increase in the
subsidy rate. For example, reducing the coverage level from 85
to 84 percent of expected yields would allow producers to
increase the subsidy rate from 38 to 48 percent of total
premium. Section 1011 would prohibit implementing continuous
coverage until after 2011. CBO estimates this provision would
save $292 million in 2006 and $1.9 billion over the 2002-2011
period. Finally, section 1030 would provide $4 million in 2002
for the National Organic Certification Cost-Share Program.
Spending Subject to Appropriation
The bill also would authorize discretionary appropriations
for existing and new programs for research and education,
nutrition, trade promotion, rural development, credit
assistance, and forestry initiatives. CBO has not completed an
estimate of the cost of these provisions.
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 Table 4. For the purposes of enforcing pay-as-you-
go procedures, only the effects in the budget year and the
succeeding four years are counted.
TABLE 4.--ESTIMATED EFFECTS OF S. 1731 ON DIRECT SPENDING AND RECEIPTS
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-------------------------------------------------------------------------------
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
----------------------------------------------------------------------------------------------------------------
Changes in outlays.............. 6,276 9,239 6,040 9,394 7,469 7,920 7,232 6,451 5,881 5,738
Changes in receipts............. Not applicable
----------------------------------------------------------------------------------------------------------------
Estimated Impact on State, Local, and Tribal Governments:
S. 1731 contains intergovernmental mandates as defined in the
Unfunded Mandates Reform Act; those mandates include
preemptions of state laws and extensions of intergovernmental
mandates already in current law. The preemptions of state law
would impose minimal, if any, costs on state governments.
However, CBO cannot determine whether the total costs of other
intergovernmental mandates in the bill would exceed the
threshold established in UMRA ($56 million in 2001, adjusted
annually for inflation) because UMRA is unclear about how the
costs of extending an existing mandate should be estimated.
Intergovernmental Mandates
The Rural Development title of S. 1731 contains a number of
preemptions of state law. These preemptions would be
intergovernmental mandates as defined in UMRA because they
would prevent the exercise of state or local authority.
Specifically, the bill would preempt any state limitations on
interest rates with regard to the newly established National
Rural Cooperative and Business Equity Fund. It also would
preempt any state or local limitations on federal ownership of
debentures issued as part of the Rural Business Investment
Program, and it would preempt any state laws limiting the
investment of banks, associations and other institutions in a
Rural Business Investment Company. Although each of these
preemptions would limit the application of state or local laws,
CBO estimates that they would not affect the budgets of state,
local, or tribal governments because they would impose no
duties on states that would result in additional spending.
The bill would require that reductions in federal
reimbursements for administrative costs in the Food Stamp
program continue beyond the scheduled expiration date in
current law (2002) through 2006. In 1997, the Congress enacted
a cap on administrative costs that could be charged to the Food
Stamp program (Public Law 105-185). CBO identified that cap as
an intergovernmental mandate because it would reduce federal
reimbursement for food stamp administrative costs and because
states have only limited authority to make programmatic or
financial changes to offset those costs. At that time, CBO
estimated annual costs of between $190 million and $280
million, but the costs have decreased to the lower end of that
range.
By extending the reductions in federal reimbursements to
states through 2006, the bill would extend an intergovernmental
mandate. UMRA is unclear, however, about how to measure costs
associated with extending an existing mandate that has not yet
expired. On the one hand, if the reductions were allowed to
expire, states might adjust their cost allocation procedures
and claim larger amounts of federal reimbursement through the
Food Stamp program. On the other hand, states have already
altered their budgets to accommodate the initial reduction in
federal reimbursements, and it is not clear that any state has
made budget plans for future budget years that assume such
reductions would end. UMRA is unclear about whether the mandate
costs should be measured based on current levels of spending or
on spending in the absence of the intergovernmental mandate (or
reductions). Consequently, CBO cannot determine whether the
costs to state governments would exceed the threshold
established in UMRA.
Other Impacts
Under current law, states receive an enhanced federal match
for administrative funding if they have payment error rates
below 6 percent in the Food Stamp program. This bill would cut
in half the formula for determining the amount of the increase
and then eliminate the system of enhanced funding.
Consequently, states that otherwise would have received the
enhanced match would receive lesser amounts. CBO estimates that
those losses would total between $58 million and $69 million
annually over the 2003-2011 period. The bill also would create
a new system of performance measures and bonuses in the Food
Stamp program; CBO estimates that those bonus payments to
states would total $30 million annually.
State, local, and tribal governments receive funds through
some of the other programs reauthorized by this bill and
probably would receive additional funds from newly authorized
programs. Some of these programs--both new and existing--
include matching requirements and other conditions of
assistance. Any costs these governments might incur to comply
with conditions of this assistance would be voluntary. Such
costs, however, would be more than offset by the grant funds
those governments receive.
Estimated Impact on the Private Sector: S. 1731 contains
several private-sector mandates as defined by UMRA. CBO
estimates that the aggregate direct costs of those mandates
would be well in excess of the annual threshold established by
UMRA ($113 million in 2001, adjusted annually for inflation) in
each of the first five years the mandates are in effect.
The bill would impose mandates on certain handlers of fluid
milk, importers of dairy products, retailers and suppliers of
certain commodities, and breeders of certain live animals.
Handlers of fluid milk that are subject to milk marketing
orders could be required to pay higher prices, based on the
bill's minimum target price of $14.25 per hundredweight.
Importers of dairy products would have to pay a new assessment
fee. Suppliers of certain commodities would have to inform
retailersof the country of origin of those commodities and
retailers would be required to inform consumers of that same
information. Breeders would be prohibited from exporting live animals
with the intent to fight, or engaging in interstate transport of live
birds with the intent to fight.
Dairy Sector Requirements
Section 132 would set new minimum prices, by region, that
handlers of class I milk (that is, milk sold for fluid use)
would be required to pay to producers under the federal milk
marketing order regulations. Federal milk marketing orders,
administered by the Agricultural Marketing Service of the U.S.
Department of Agriculture, set minimum prices for milk
purchased from producers within areas governed by the orders.
Federal marketing orders regulate pricing in major milk
production areas in the United States, except for California, a
handful of other states, and portions of some other states.
California operates under state marketing order regulations,
which would be unaffected by this change in the law.
CBO estimates that the new minimum class I prices would
cause handlers to pay more for milk than they would pay under
current law, with the aggregate increase in their costs
totaling about $1.5 billion in each of 2002 and 2003, $1.4
billion in 2004 and 2005, and $1.3 billion in 2006. Most or all
of those increased costs faced by milk handlers would be passed
on to consumers of milk and milk products through higher retail
prices.
Section 136 would impose a mandate on importers of dairy
products by expanding a dairy promotion assessment to cover
imports of dairy products. Under current law, USDA collects an
assessment from domestic dairy producers to fund activities of
the National Dairy Promotion and Research Board. The bill would
require the assessment rate on imported dairy products to be
determined in the same manner as the assessment rate per
hundredweight or the equivalent of domestic milk. The funds
collected from importers of dairy products would be combined
with collections from domestic producers. Using an assessment
rate equivalent to the current rate paid by domestic producers
of dairy products, CBO estimates the cost of the assessment on
importers would total about $11 million annually.
In addition, section 135 would amend the Agriculture
Marketing Act to allow the Secretary of Agriculture to expand
the reporting requirement now placed on manufacturers and
persons who store dairy products. That is, the bill would give
the Secretary the authority to expand the list of products for
which producers must report on inventories and make records
available to the government. The provisions would impose a new
mandate if the Secretary used the authority to make additional
products subject to current requirements. USDA could not
indicate which products, if any, would be added to the list.
Nonetheless, since producers already keep extensive records on
inventories at storage facilities, the incremental cost of
complying with such requirements would be small.
Country-of-Origin Labeling Requirements
Section 1001 would require retailers to inform consumers,
at the final point of sale, of the country of origin of beef,
lamb, pork, farm-raised fish, fresh fruits and vegetables, and
peanuts. Suppliers of those commodities would be required to
provide the same information to retailers. The major costs
associated with the new country-of-origin labeling requirements
are related to the cost to segregate and preserve commodity
identity, to label the commodity, and to maintain records.
The incremental cost of this mandate is uncertain. Although
rare, some grocers, meat packers, and farmers voluntarily use
labels to identify U.S. products. Also, data to estimate
compliance costs are not available for some commodities.
Moreover, compliance costs depend on the specific standards to
be established by the Secretary. According to information from
representatives of the industry, the costs to retailers and
suppliers to provide country-of-origin information on some of
the commodities covered in this bill could be as high as $1
billion annually.
Ban on Commerce in Live Animals with the Intent to Fight
Under current law, any person is prohibited from
transporting or delivering a dog or other animal--with the
exception of live birds--between states to participate in an
animal fighting venture. Section 1025 would amend the Animal
Welfare Act to remove that exception and to ban the interstate
movement of live birds for the purpose of fighting. The bill
would not prohibit breeders from transporting animals for
reasons other than to fight. In addition, section 1024 would
prohibit the export of live animals with the intent to fight.
CBO cannot estimate the direct cost because sufficient
information about the export of such live animals is not
available.
Previous CBO Estimates: On November 28, 2001, CBO
transmitted a summary of the estimated effects of S. 1731. The
numbers included in this more-detailed cost estimate are
unchanged from those provided on November 28.
On August 23, 2001, CBO transmitted a cost estimate for
H.R. 2646, the Farm Security Act of 2001, as reported by the
House Committee on Agriculture on August 2, 2001. That bill
would have a similar impact on total direct spending for
agricultural programs over the 2002-2011 period: an increase of
$69.5 billion (as compared to $71.6 billion over the same
period for S. 1731). The bills differ significantly, however,
in the composition of such spending. In addition, S. 1731 would
increase direct spending more than H.R. 2646 in 2002 ($6.3
billion verses $1.9 billion) and over the 2002-2006 period
($38.4 billion verses $33.4 billion).
H.R. 2646 would impose private-sector mandates by charging
new assessments on importers of dairy products and U.S.
producers of caneberries. The House bill also would allow the
Secretary of Agriculture to expand the reporting requirement
now placed on manufacturers and persons who store dairy
products. While most of the mandates in H.R. 2646 are also
contained in S. 1731, the House bill did not include a minimum
price restriction on handlers of fluid milk, a country-of-
origin labeling requirement on retailers and suppliers, or a
prohibition on the interstate transport or exportation of live
animals with the intent to fight. CBO found that the aggregate
cost of mandates in H.R. 2646 would fall below the annual
threshold for private-sector mandates established in UMRA.
Estimate Prepared by: Federal costs: Jim Langley, Greg
Hitz, Dave Hull, Lanette Walker, Megan Carroll, Lisa Cash
Driskill, and Mark Hadley; Joseph Whitehill (226-2840); and
Valerie Baxter Womer (226-2820). Impact on State, Local, and
Tribal Governments: Marjorie Miller and Leo Lex. Impact on the
Private Sector: Roger Hitchner, Jean Talarico, Cecil McPherson;
and Ralph Smith.
Estimate approved by: Peter H. Fontaine, Deputy Assistant
Director for Budget Analysis.
VIII. Changes in Existing Law
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, changes in existing law made in
the bill, as reported are shown as follows: existing law
proposed to be omitted is enclosed in black brackets and new
material is printed in italic.
TITLE 1
* * * * * * *
AGRICULTURAL MARKET TRANSITION ACT
* * * * * * *
[SEC. 102. DEFINITIONS.
[In this title:
[(1) Agricultural act of 1949.--Except in section
171, the term ``Agricultural Act of 1949'' means the
Agricultural Act of 1949 (7 U.S.C. 1421 et seq.), as in
effect prior to the suspensions under section
171(b)(1).
[(2) Considered planted.--The term ``considered
planted'' means acreage that is considered planted
under title V of the Agricultural Act of 1949 (7 U.S.C.
1461 et seq.) and such other acreage as the Secretary
considers fair and equitable.
[(3) Contract.--The terms ``contract'' and
``production flexibility contract'' mean a production
flexibility contract entered into under section 111.
[(4) Contract acreage.--The term ``contract acreage''
means 1 or more crop acreage bases established for
contract commodities under title V of the Agricultural
Act of 1949 (7 U.S.C. 1461 et seq.) that would have
been in effect for the 1996 crop (but for suspension
under section 171(b)(1)).
[(5) Contract commodity.--The term ``contract
commodity'' means wheat, corn, grain sorghum, barley,
oats, upland cotton, and rice.
[(6) Contract payment.--The term ``contract payment''
means a payment made under this subtitle pursuant to a
contract.
[(7) Department.--The term ``Department'' means the
Department of Agriculture.
[(8) Extra long staple cotton.--The term ``extra long
staple cotton'' means cotton that--
[(A) is produced from pure strain varieties
of the Barbadense species or any hybrid
thereof, or other similar types of extra long
staple cotton, designated by the Secretary,
having characteristics needed for various end
uses for which United States upland cotton is
not suitable and grown in irrigated cotton-
growing regions of the United States designated
by the Secretary or other areas designated by
the Secretary as suitable for the production of
the varieties or types; and
[(B) is ginned on a roller-type gin or, if
authorized by the Secretary, ginned on another
type gin for experimental purposes.
[(9) Farm program payment yield.--The term ``farm
program payment yield'' means the farm program payment
yield established for the 1995 crop of a contract
commodity under section 505 of the Agricultural Act of
1949 (7 U.S.C. 1465). The Secretary shall adjust the
farm program payment yield for the 1995 crop of a
contract commodity to account for any additional yield
payments made with respect to that crop under
subsection (b)(2) of the section.
[(10) Loan commodity.--The term ``loan commodity''
means each contract commodity, extra long staple
cotton, and oilseed.
[(11) Oilseed.--The term ``oilseed'' means a crop of
soybeans, sunflower seed, rapeseed, canola, safflower,
flaxseed, mustard seed, or, if designated by the
Secretary, other oilseeds.
[(12) Producer.--The term ``producer'' means an
owner, operator, landlord, tenant, or sharecropper who
shares in the risk of producing a crop and who is
entitled to share in the crop available for marketing
from the farm, or would have shared had the crop been
produced. In determining whether a grower of hybrid
seed is a producer, the Secretary shall not take into
consideration the existence of a hybrid seed contract.
[(13) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture.
[(14) State.--The term ``State'' means each of the
several States of the United States, the District of
Columbia, the Commonwealth of Puerto Rico, and any
other territory or possession of the United States.
[(15) United States.--The term ``United States'',
when used in a geographical sense, means all of the
States.]
SEC. 102. DEFINITIONS.
In this title:
(1) Agricultural act of 1949.--Except in section 171,
the term ``Agricultural Act of 1949'' means the
Agricultural Act of 1949 (7 U.S.C. 1421 et seq.), as in
effect prior to the suspensions under section
171(b)(1).
(2) Considered planted.--The term ``considered
planted'' means any acreage on the farm that--
(A) producers on a farm were prevented from
planting to a crop because of drought, flood,
or other natural disaster, or other condition
beyond the control of the eligible owners and
producers on the farm, as determined by the
Secretary; and
(B) was not planted to another contract
commodity (other than a contract commodity
produced under an established practice of
double cropping).
(3) Contract.--The term ``contract'' means a contract
entered into under subtitle B.
(4) Contract acreage.--The term ``contract acreage''
means the contract acreage determined under section
111(f).
(5) Contract commodity.--The term ``contract
commodity'' means wheat, corn, grain sorghum, barley,
oats, upland cotton, rice, and oilseeds.
(6) Contract payment.--The term ``contract payment''
means a payment made under subtitle B pursuant to a
contract.
(7) Department.--The term ``Department'' means the
Department of Agriculture.
(8) Extra long staple cotton.--The term `extra long
staple cotton' means cotton that--
(A) is produced from pure strain varieties of
the Barbadense species or any hybrid thereof,
or other similar types of extra long staple
cotton, designated by the Secretary, having
characteristics needed for various end uses for
which United States upland cotton is not
suitable and grown in irrigated cotton-growing
regions of the United States designated by the
Secretary or other areas designated by the
Secretary as suitable for the production of the
varieties or types; and
(B) is ginned on a roller-type gin or, if
authorized by the Secretary, ginned on another
type gin for experimental purposes.
(9) Loan commodity.--The term ``loan commodity''
means wheat, corn, grain sorghum, barley, oats, upland
cotton, extra long staple cotton, rice, oilseeds, wool,
mohair, honey, dry peas, lentils, and chickpeas.
(10) Oilseed.--The term ``oilseed'' means a crop of
soybeans, sunflower seed, rapeseed, canola, safflower,
flaxseed, mustard seed, and, if designated by the
Secretary, other oilseeds.
(11) Payment yield.--The term ``payment yield'' means
a payment yield determined under section 111(g).
(12) Producer.--
(A) In general.--The term ``producer'' means
an owner, operator, landlord, tenant, or
sharecropper that--
(i) shares in the risk of producing a
crop; and
(ii) is entitled to share in the crop
available for marketing from the farm,
or would have shared had the crop been
produced.
(B) Hybrid seed.--In determining whether a
grower of hybrid seed is a producer, the
Secretary shall not take into consideration the
existence of a hybrid seed contract.
(13) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture.
(14) State.--The term ``State'' means--
(A) a State;
(B) the District of Columbia;
(C) the Commonwealth of Puerto Rico; and
(D) any other territory or possession of the
United States.
(15) United states.--The term `United States', when
used in a geographical sense, means all of the States.
Subtitle B--Production Flexibility Contracts
[AUTHORIZATION FOR USE OF PRODUCTION FLEXIBILITY CONTRACTS.
[(a) Offer and Terms.--The Secretary shall offer to enter
into a production flexibility contract with an eligible owner
or producer described in subsection (b) on a farm containing
eligible cropland. Under the terms of a contract, the owner or
producer shall agree, in exchange for annual contract payments,
to--
[(1) comply with applicable conservation requirements
under subtitle B of title XII of the Food Security Act
of 1985 (16 U.S.C. 3811 et seq.);
[(2) comply with applicable wetland protection
requirements under subtitle C of title XII of the Act
(16 U.S.C. 3821 et seq.);
[(3) comply with the planting flexibility
requirements of section 118; and
[(4) use the land subject to the contract for an
agricultural or related activity, but not for a
nonagricultural commercial or industrial use, as
determined by the Secretary.
[(b) Eligible Owners and Producers Described.--The
following producers and owners shall be eligible to enter into
a contract:
[(1) An owner of eligible cropland who assumes all or
a part of the risk of producing a crop.
[(2) A producer (other than an owner) on eligible
cropland with a share-rent lease of the eligible
cropland, regardless of the length of the lease, if the
owner enters into the same contract.
[(3) A producer (other than an owner) on eligible
cropland who cash rents the eligible cropland under a
lease expiring on or after September 30, 2002, in which
case the owner is not required to enter into the
contract.
[(4) A producer (other than an owner) on eligible
cropland who cash rents the eligible cropland under a
lease expiring before September 30, 2002. The owner of
the eligible cropland may also enter into the same
contract. If the producer elects to enroll less than
100 percent of the eligible cropland in the contract,
the consent of the owner is required.
[(5) An owner of eligible cropland who cash rents the
eligible cropland and the lease term expires before
September 30, 2002, if the tenant declines to enter
into a contract. In the case of an owner covered by
this paragraph, contract payments shall not begin under
a contract until the lease held by the tenant ends.
[(6) An owner or producer described in any preceding
paragraph regardless of whether the owner or producer
purchased catastrophic risk protection for a 1996 crop
under section 508(b) of the Federal Crop Insurance Act
(7 U.S.C. 1508(b)).
[(c) Tenants and Sharecroppers.--In carrying out this
subtitle, the Secretary shall provide adequate safeguards to
protect the interests of tenants and sharecroppers.
[(d) Eligible Cropland Described.--Land shall be considered
to be cropland eligible for coverage under a contract only if
the land has contract acreage attributable to the land and--
[(1) for at least 1 of the 1991 through 1995 crops,
at least a portion of the land was enrolled in the
acreage reduction program authorized for a crop of a
contract commodity under section 101B, 103B, 105B, or
107B of the Agricultural Act of 1949 or was considered
planted;
[(2) was subject to a conservation reserve contract
under section 1231 of the Food Security Act of 1985 (16
U.S.C. 3831) whose term expired, or was voluntarily
terminated, on or after January 1, 1995; or
[(3) is released from coverage under a conservation
reserve contract by the Secretary during the period
beginning on January 1, 1995, and ending on the date
specified in section 112(a)(2).
[(e) Quantity of Eligible Cropland Covered by Contract.--
Subject to subsection (b)(4), an owner or producer may enroll
as contract acreage all or a portion of the eligible cropland
on the farm.
[(f) Voluntary Reduction in Contract Acreage.--Subject to
subsection (b)(4), an owner or producer who enters into a
contract may subsequently reduce the quantity of contract
acreage covered by the contract.
[SEC. 112. ELEMENTS OF CONTRACTS.
[(a) Time for Contracting.--
[(1) Commencement.--To the extent practicable, the
Secretary shall commence entering into contracts not
later than 45 days after the date of enactment of this
title.
[(2) Deadline.--Except as provided in paragraph (3),
the Secretary may not enter into a contract after
August 1, 1996.
[(3) Conservation reserve lands.--
[(A) In general.--At the beginning of each
fiscal year, the Secretary shall allow an
eligible owner or producer on a farm covered by
a conservation reserve contract entered into
under section 1231 of the Food Security Act of
1985 (16 U.S.C. 3831) that terminates after the
date specified in paragraph (2) to enter into
or expand a production flexibility contract to
cover the contract acreage of the farm that was
subject to the former conservation reserve
contract.
[(B) Amount.--Contract payments made for
contract acreage under this paragraph shall be
made at the rate and amount applicable to the
annual contract payment level for the
applicable crop. For the fiscal year in which
the conservation reserve contract is
terminated, the owner or producer subject to
the production flexibility contract may elect
to receive either contract payments or a
prorated payment under the conservation reserve
contract, but not both.
[(b) Duration of Contract.--
[(1) Beginning date.--The term of a contract shall
begin with--
[(A) the 1996 crop of a contract commodity;
or
[(B) in the case of acreage that was subject
to a conservation reserve contract described in
subsection (a)(3), the date the production
flexibility contract was entered into or
expanded to cover the acreage.
[(2) Ending date.--The term of a contract shall
extend through the 2002 crop, unless earlier terminated
by the owner or producer.
[(c) Estimation of Contract Payments.--At the time the
Secretary enters into a contract, the Secretary shall provide
an estimate of the minimum contract payments anticipated to be
made during at least the first fiscal year for which contract
payments will be made.
[(d) Time for Payment.--
[(1) In general.--An annual contract payment shall be
made not later than September 30 of each of fiscal
years 1996 through 2002.
[(A) Fiscal year 1996.--At the option of the
owner or producer, 50 percent of the contract
payment for fiscal year 1996 shall be made not
later than 30 days after the date on which the
contract is entered into and approved by the
Secretary and the owner or producer.
[(B) Subsequent fiscal years.--At the option
of the owner or producer for fiscal year 1997
and each subsequent fiscal year, 50 percent of
the annual contract payment shall be made on
December 15 or January 15 of the fiscal year.
The owner or producer may change the date
selected under this subparagraph for a
subsequent fiscal year by providing advance
notice to the Secretary.
[(2) Advance payments.--
[(3) Special rule.--Notwithstanding the requirements
for making an annual contract payment specified in
paragraphs (1) and (2), at the option of the owner or
producer, the Secretary shall pay the full amount (or
such portion as the owner or producer may specify) of
the contract payment required to be paid for any of
fiscal years 1999 through 2002 at such time or times
during that fiscal year as the owner or producer may
specify.
[SEC. 113. AMOUNTS AVAILABLE FOR CONTRACT PAYMENTS.
[(a) Fiscal Year Amounts.--The Secretary shall, to the
maximum extent practicable, expend the following amounts to
satisfy the obligations of the Secretary under all contracts:
[(1) For fiscal year 1996, $5,570,000,000.
[(2) For fiscal year 1997, $5,385,000,000.
[(3) For fiscal year 1998, $5,800,000,000.
[(4) For fiscal year 1999, $5,603,000,000.
[(5) For fiscal year 2000, $5,130,000,000.
[(6) For fiscal year 2001, $4,130,000,000.
[(7) For fiscal year 2002, $4,008,000,000.
[(b) Allocation.--The amount made available for a fiscal
year under subsection (a) shall be allocated as follows:
[(1) For wheat, 26.26 percent.
[(2) For corn, 46.22 percent.
[(3) For grain sorghum, 5.11 percent.
[(4) For barley, 2.16 percent.
[(5) For oats, 0.15 percent.
[(6) For upland cotton, 11.63 percent.
[(7) For rice, 8.47 percent.
[(c) Adjustment.--The Secretary shall adjust the amounts
allocated for each contract commodity under subsection (b) for
a particular fiscal year by--
[(1) adding an amount equal to the sum of all
repayments of deficiency payments required under
section 114(a)(2) of the Agricultural Act of 1949 (7
U.S.C. 1445j(a)(2)) for the commodity;
[(2) adding an amount equal to the sum of all refunds
of contract payments received during the preceding
fiscal year under section 116 for the commodity; and
[(3) subtracting an amount equal to the amount, if
any, necessary during that fiscal year to satisfy
payment requirements for the commodity under sections
103B, 105B, or 107B of the Agricultural Act of 1949 for
the 1994 and 1995 crop years.
[(d) Additional Rice Allocation.--In addition to the
adjustments required under subsection (c), the amount allocated
under subsection (b) for rice contract payments shall be
increased by $8,500,000 for each of fiscal years 1997 through
2002.
[(e) Exclusion of Certain Amounts From Contract Payments.--
Any amount added pursuant to paragraphs (1) and (2) of
subsection (c) to the amount available under subsection (a) for
a fiscal year and paid to owners and producers under a contract
shall not be treated as a contract payment for purposes of
section 115(a) of this title or section 1001(1) of the Food
Security Act of 1985 (7 U.S.C. 1308(1)). However, the amount of
a payment covered by this subsection may not exceed $50,000 per
person.
[(f) Effect of Payment Limitation.--The amount available
under subsection (a) for a fiscal year shall be reduced by an
amount equal to the total amount of contract payments for the
fiscal year that owners and producers forgo as a result of
operation of the payment limitation under section 1001(1) of
the Food Security Act of 1985 (7 U.S.C. 1308(1)).
[SEC. 114. DETERMINATION OF CONTRACT PAYMENTS UNDER CONTRACTS.
[(a) Individual Payment Quantity of Contract Commodities.--
For each contract, the payment quantity of a contract commodity
for each fiscal year shall be equal to the product of--
[(1) 85 percent of the contract acreage; and
[(2) the farm program payment yield.
[(b) Annual Payment Quantity of Contract Commodities.--The
payment quantity of each contract commodity covered by all
contracts for each fiscal year shall be equal to the sum of the
amounts calculated under subsection (a) for each individual
contract.
[(c) Annual Payment Rate.--The payment rate for a contract
commodity for each fiscal year shall be equal to--
[(1) the amount made available under section 113 for
the contract commodity for the fiscal year; divided by
[(2) the amount determined under subsection (b) for
the fiscal year.
[(d) Annual Payment Amount.--The amount to be paid under a
contract in effect for each fiscal year with respect to all
contract commodities covered by the contract shall be equal to
the sum of the products of--
[(1) the payment quantity determined under subsection
(a) for each of the contract commodities covered by the
contract; and
[(2) the corresponding payment rate for the contract
commodity in effect under subsection (c).
[(e) Reduction in Payment Amount.--The contract payment
determined under subsection (d) for an owner or producer for a
fiscal year shall be immediately reduced by the amount of any
repayment of deficiency payments that is required under section
114(a)(2) of the Agricultural Act of 1949 (7 U.S.C.
1445j(a)(2)) and is not repaid as of the date the contract
payment is determined. The Secretary shall be required to
collect the required repayment, or any claim based on the
required repayment, as soon as the contract payment is
determined.
[(f) Assignment of Contract Payments.--The provisions of
section 8(g) of the Soil Conservation and Domestic Allotment
Act (16 U.S.C. 590h(g)) (relating to assignment of payments)
shallapply to contract payments under this section. The owner
or producer making the assignment, or the assignee, shall provide the
Secretary with notice, in such manner as the Secretary may require in
the contract, of any assignment made under this subsection.
[(g) Sharing of Contract Payments.--The Secretary shall
provide for the sharing of contract payments among the owners
and producers subject to the contract on a fair and equitable
basis.]
SEC. 111. AUTHORIZATION FOR CONTRACTS.
(a) In General.--The Secretary shall offer to enter into a
contract with an eligible owner or producer described in
subsection (b) on a farm containing eligible cropland under
which the eligible owner or producer will receive direct
payments and counter-cyclical payments under sections 113 and
114, respectively.
(b) Eligible Owners and Producers.--
(1) In general.--Subject to paragraphs (2) and (3),
an owner or producer on a farm shall be eligible to
enter into a contract.
(2) Tenants.--
(A) Share-rent tenants.--A producer on
eligible cropland that is a tenant with a
share-rent lease of the eligible cropland,
regardless of the length of the lease, shall be
eligible to enter into a contract, if the owner
of the eligible cropland enters into the same
contract.
(B) Cash-rent tenants.--
(i) Contracts with long-term
leases.--A producer on eligible
cropland that cash rents the eligible
cropland under a lease expiring on or
after the termination of the contract
shall be eligible to enter into a
contract.
(ii) Contracts with short-term
leases.--
(I) In general.--A producer
that cash rents the eligible
cropland under a lease expiring
before the termination of the
contract shall be eligible to
enter into a contract.
(II) Owner's contract
interest.--The owner of the
eligible cropland may also
enter into the same contract.
(III) Consent of owner.--If
the producer elects to enroll
less than 100 percent of the
eligible cropland in the
contract, the consent of the
owner shall be required for a
valid contract.
(3) Cash-rent owners.--
(A) In general.--An owner of eligible
cropland that cash rents the eligible cropland
under a lease term that expires before the end
of 2006 crop year shall be eligible to enter
into a contract if the tenant declines to enter
into the contract.
(B) Contract payments.--In the case of an
owner covered by subparagraph (A), the
Secretary shall not make contract payments to
the owner under the contract until the lease
held by the tenant terminates.
(c) Compliance With Certain Requirements.--Under the terms
of a contract, the owner or producer shall agree, in exchange
for annual contract payments--
(1) to comply with applicable highly erodible land
conservation requirements under subtitle B of title XII
of the Food Security Act of 1985 (16 U.S.C. 3811 et
seq.);
(2) to comply with applicable wetland conservation
requirements under subtitle C of title XII of that Act
(16 U.S.C. 3821 et seq.);
(3) to comply with the planting flexibility
requirements of section 118; and
(4) to use a quantity of land on the farm equal to
the contract acreage, for an agricultural or conserving
use or related activity, and not for a nonagricultural
commercial or industrial use, as determined by the
Secretary.
(d) Protection of Interests of Certain Producers.--
(1) Tenants and sharecroppers.--In carrying out this
subtitle, the Secretary shall provide adequate
safeguards to protect the interests of tenants and
sharecroppers.
(2) Sharing of payments.--The Secretary shall provide
for the sharing of contract payments among the eligible
producers on a farm on a fair and equitable basis.
(e) Eligible Cropland.--
(1) In general.--Land shall be considered to be
cropland eligible for coverage under a contract only if
the land--
(A) has with respect to a contract
commodity--
(i) contract acreage attributable to
the land; and
(ii) a payment yield; or
(B) was subject to a conservation reserve
contract under section 1231 of the Food
Security Act of 1985 (16 U.S.C. 3831) with a
term that expired, or was voluntarily
terminated, on or after the date of enactment
of this paragraph.
(2) Quantity of eligible cropland covered by
contract.--An eligible owner or producer may enroll as
contract acreage under this subtitle all or a portion
of the eligible cropland on the farm.
(3) Voluntary reduction in contract acreage.--An
eligible owner or producer that enters into a contract
may subsequently reduce the quantity of contract
acreage covered by the contract.
(f) Contract Acreage.--
(1) In general.--Subject to subsection (h), for the
purpose of making direct payments and counter-cyclical
payments to eligible owners and producers on a farm,
the Secretary shall provide the eligible owners and
producers on the farm with an opportunity to elect 1 of
the following methods as the method by which the
contract acreages for the 2002 through 2006 crops of
all contract commodities for a farm are determined:
(A) The 4-year average of acreage planted or
considered planted to a contract commodity for
harvest, grazing, haying, silage, or other
similar purposes during each of the 1998
through 2001 crop years.
(B) The total of--
(i) the contract acreage (as defined
in section 102 (as in effect before the
amendment made by section 101 of the
Agriculture, Conservation, and Rural
Enhancement Act of 2001)) that would
have been used by the Secretary to
calculate the payment for fiscal year
2002 under such section 102 for the
contract commodity on the farm; and
(ii) the 4-year average determined
under subparagraph (A) for each oilseed
produced on the farm.
(C) In the case of land described in section
112(a)(3), land with eligible base, as
determined by the Secretary.
(2) Prevention of excess contract acreages.--
(A) Required reduction.--If the total of the
contract acreages for a farm, together with the
acreage described in subparagraph (C), exceeds
the actual cropland acreage of the farm, the
Secretary shall reduce the quantity of contract
acreages for 1 or more contract commodities for
the farm or peanut acres as necessary so that
the total of the contract acreages and acreage
described in subparagraph (C) does not exceed
the actual cropland acreage of the farm.
(B) Selection of acres.--The Secretary shall
give the eligible owners and producers on the
farm the opportunity to select the contract
acreages or peanut acres against which the
reduction will be made.
(C) Other acreage.--For purposes of
subparagraph (A), the Secretary shall include--
(i) any peanut acres for the farm
under chapter 3 of subtitle D;
(ii) any acreage on the farm enrolled
in the conservation reserve program or
wetlands reserve program under chapter
1 of subtitle D of title XII of the
Food Security Act of 1985 (16 U.S.C.
3830 et seq.); and
(iii) any other acreage on the farm
enrolled in a voluntary Federal
conservation program under which
production of any agricultural
commodity is prohibited.
(D) Double-cropped acreage.--In applying
subparagraph (A), the Secretary shall take into
account additional acreage as a result of an
established double-cropping history on a farm,
as determined by the Secretary.
(g) Payment Yields.--
(1) In general.--Subject to paragraph (2) and
subsection (h), an eligible owner or producer that has
entered into a contract under this subtitle may make a
1-time election to have the payment yield for a payment
for each of the 2002 through 2006 crops of all contract
commodities for a farm be equal to--
(A) an amount that is the greater of--
(i) the average of the yield per
harvested acre for the crop of the
contract commodity for the farm for the
1998 through 2001 crop years,
excluding--
(I) any crop year for which
the producers on the farm did
not plant the contract
commodity; and
(II) at the option of the
producers on the farm, 1
additional crop year; or
(ii) the farm program payment yield
described in subparagraph (B); or
(B) the farm program payment yield
established for the 1995 crop of a contract
commodity under section 505 of the Agricultural
Act of 1949 (7 U.S.C. 1465), as adjusted by the
Secretary to account for any additional yield
payments made with respect to that crop under
section 505(b)(2) of that Act.
(2) Assigned yields.--In the case of a farm for which
yield records are unavailable for a contract commodity
(including land of a farm that is devoted to an oilseed
under a former conservation reserve contract described
in section 112(a)(3)), the Secretary shall establish an
appropriate payment yield for the contract commodity on
the farm taking in consideration the payment yields
applicable to the contract commodity under paragraph
(1) for similar farms in the area, taking into
consideration the yield election for the farm under
subsection (h).
(h) Eligible Owner and Producer Election Options.--
(1) In general.--In making elections under
subsections (f) and (g), eligible owners and producers
on a farm shall elect to have--
(A)(i) contract acreage for the farm
determined under subsection (f)(1)(A); and
(ii) payment yields determined under
subsection (g)(1)(A); or
(B)(i) contract acreage for the farm
determined under subsection (f)(1)(B); and
(ii) payment yields determined under--
(I) in the case of contract
commodities other than oilseeds,
subsection (g)(1)(B); and
(II) in the case of oilseeds,
subsection (g)(1)(A).
(2) Single election; time for election.--
(A) Single election.--The eligible owners and
producers on a farm shall have 1 opportunity to
make the election described in paragraph (1).
(B) Time for election.--Subject to section
112(a)(3), not later than 180 days after the
date of enactment of this subsection, the
eligible owners and producers on a farm shall
notify the Secretary of the election made by
the eligible owners and producers on the farm
under paragraph (1).
(3) Effect of failure to make election.--If the
producers on a farm fail to make the election under
paragraph (1), or fail to timely notify the Secretary
of the selected option as required by paragraph (2),
the eligible owners and producers on the farm shall be
deemed to have made the election described in paragraph
(1)(B) for the purpose of determining the contract
acreages for all contract commodities on the farm.
(4) Application of election to all contract
commodities.--The election made under paragraph (1) or
deemed to be made under paragraph (3) with respect to a
farm shall apply to all of the contract commodities
produced on the farm.
SEC. 112. ELEMENTS OF CONTRACTS.
(a) Time for Contracting.--
(1) Commencement.--To the extent practicable, the
Secretary shall commence entering into contracts not
later than 45 days after the date of enactment of the
Agriculture, Conservation, and Rural Enhancement Act of
2001.
(2) Deadline.--Except as provided in paragraph (3),
the Secretary may not enter into a contract after the
date that is 180 days after the date of enactment of
that Act.
(3) Conservation reserve land.--
(A) In general.--At the beginning of each
fiscal year, the Secretary shall allow an
eligible owner or producer on a farm covered by
a conservation reserve contract entered into
under section 1231 of the Food Security Act of
1985 (16 U.S.C. 3831) that terminated after the
date specified in paragraph (2) to enter into
or expand a contract to cover the eligible
cropland of the farm that was subject to the
former conservation reserve contract.
(B) Election.--For the fiscal year and crop
year for which a contract acreage adjustment
under subparagraph (A) is first made, the
eligible owners and producers on the farm shall
elect to receive--
(i) direct payments and counter-
cyclical payments under sections 113
and 114, respectively, with respect to
the acreage added to the farm under
this paragraph; or
(ii) a prorated payment under the
conservation reserve contract.
(b) Duration of Contract.--
(1) Beginning date.--The term of a contract shall
begin with--
(A) the 2002 crop of a contract commodity; or
(B) in the case of acreage that was subject
to a conservation reserve contract described in
subsection (a)(3), the date the contract was
entered into or expanded to cover the acreage.
(2) Ending date.--Subject to sections 116 and 117,
the term of a contract shall extend through the 2006
crop, unless earlier terminated by the eligible owners
or producers on a farm.
SEC. 113. DIRECT PAYMENTS.
(a) In General.--For each of the 2002 through 2006 fiscal
years, the Secretary shall make direct payments available to
eligible owners and producers on a farm that have entered into
a contract to receive payments under this section.
(b) Payment Amount.--The amount of a direct payment to be
paid to the eligible owners and producers on a farm for a
contract commodity for a fiscal year under this section shall
be obtained by multiplying--
(1) the payment rate for the contract commodity
specified in subsection (c);
(2) the contract acreage attributable to the contract
commodity for the farm; and
(3) the payment yield for the contract commodity for
the farm.
(c) Payment Rate.--The payment rates used to make direct
payments with respect to contract commodities for a fiscal year
under this section are as follows:
(1) Wheat.--In the case of wheat:
(A) For each of fiscal years 2002 and 2003,
$0.450 per bushel.
(B) For each of fiscal years 2004 and 2005,
$0.225 per bushel.
(C) For fiscal year 2006, $0.113 per bushel.
(2) Corn.--In the case of corn:
(A) For each of fiscal years 2002 and 2003,
$0.270 per bushel.
(B) For each of fiscal years 2004 and 2005,
$0.135 per bushel.
(C) For fiscal year 2006, $0.068 per bushel.
(3) Grain sorghum.--In the case of grain sorghum:
(A) For the 2002 fiscal year, $0.310 per
bushel.
(B) For the 2003 fiscal year, $0.270 per
bushel.
(C) For each of fiscal years 2004 and 2005,
$0.135 per bushel.
(D) For fiscal year 2006, $0.068 per bushel.
(4) Barley.--In the case of barley:
(A) For each of fiscal years 2002 and 2003,
$0.200 per bushel.
(B) For each of fiscal years 2004 and 2005,
$0.100 per bushel.
(C) For fiscal year 2006, $0.050 per bushel.
(5) Oats.--In the case of oats:
(A) For each of fiscal years 2002 and 2003,
$0.050 per bushel.
(B) For each of fiscal years 2004 and 2005,
$0.025 per bushel.
(C) For fiscal year 2006, $0.013 per bushel.
(6) Upland cotton.--In the case of upland cotton:
(A) For each of fiscal years 2002 and 2003,
$0.130 per pound.
(B) For each of fiscal years 2004 and 2005,
$0.065 per pound.
(C) For fiscal year 2006, $0.0325 per pound.
(7) Rice.--In the case of rice:
(A) For each of fiscal years 2002 and 2003,
$2.450 per hundredweight.
(B) For each of fiscal years 2004 and 2005,
$1.225 per hundredweight.
(C) For fiscal year 2006, $0.6125 per
hundredweight.
(8) Soybeans.--In the case of soybeans:
(A) For each of fiscal years 2002 and 2003,
$0.550 per bushel.
(B) For each of fiscal years 2004 and 2005,
$0.275 per bushel.
(C) For fiscal year 2006, $0.138 per bushel.
(9) Oilseeds (other than soybeans).--In the case of
oilseeds (other than soybeans):
(A) For each of fiscal years 2002 and 2003,
$0.010 per pound.
(B) For each of fiscal years 2004 and 2005,
$0.005 per pound.
(C) For fiscal year 2006, $0.0025 per pound.
(d) Time for Payments.--
(1) Initial payment.--At the option of the eligible
owners and producers on a farm, the Secretary shall pay
50 percent of the direct payment for a crop of a
contract commodity for the eligible owners and
producers on the farm on or after December 1 of the
fiscal year, as determined by the Secretary.
(2) Final payment.--The Secretary shall pay the final
amount of the direct payment that is payable to the
eligible owners and producers on a farm for a contract
commodity under subsection (a) (less the amount of any
initial payment made to the producers on the farm of
the contract commodity under paragraph (1)) not later
than September 30 of the fiscal year, as determined by
the Secretary.
SEC. 114. COUNTER-CYCLICAL PAYMENTS.
(a) In General.--For each of the 2002 through 2006 crop
years, the Secretary shall make counter-cyclical payments to
eligible owners and producers on a farm of each contract
commodity that have entered into a contract to receive payments
under this section.
(b) Payment Amount.--The amount of the payments made to
eligible owners and producers on a farm for a crop of a
contract commodity under this section shall equal the amount
obtained by multiplying--
(1) the payment rate for the contract comodity
specified in subsection (c);
(2) the contract acreage attributable to the contract
commodity for the farm; and
(3) the payment yield for the contract commodity for
the farm.
(c) Payment Rates.--
(1) In general.--The payment rate for a crop of a
contract commodity under subsection (b)(1) shall equal
the difference between--
(A) the income protection price for the
contract commodity established under paragraph
(2); and
(B) the total of--
(i) the higher of--
(I) the average price of the
contract commodity during the
first 5 months of the marketing
year of the contract commodity,
as determined by the Secretary;
and
(II) the loan rate for the
crop of the contract commodity
under section 132; and
(ii) the direct payment for the
contract commodity under section 113
for the fiscal year that precedes the
date of a payment under this section.
(2) Income protection prices.--The income protection
prices for contract commodities under paragraph (1)(A)
are as follows:
(A) Wheat, $3.45 per bushel.
(B) Corn, $2.35 per bushel.
(C) Grain sorghum, $2.35 per bushel.
(D) Barley, $2.20 per bushel.
(E) Oats, $1.55 per bushel.
(F) Upland cotton, $0.680 per pound.
(G) Rice, $9.30 per hundredweight.
(H) Soybeans, $5.75 per bushel.
(I) Oilseeds (other than soybeans), $0.105
per pound.
(d) Time for Payment.--The Secretary shall make counter-
cyclical payments for each of the 2002 through 2006 crop years
not later than 190 days after the beginning of marketing year
for the crop of the contract commodity.
* * * * * * *
SEC. 116. VIOLATIONS OF CONTRACT.
(a) Termination of Contract for Violation.--Except as
provided in [subsection (b)] subsections (b) and (e), if an
owner or producer subject to a contract violates a requirement
of the contract specified in [section 111(a)] this subtitle,
the Secretary shall terminate the contract with respect to the
owner or producer on each farm in which the owner or producer
has an interest. On the termination, the owner or producer
shall forfeit all rights to receive future contract payments on
each farm in which the owner or producer has an interest and
shall refund to the Secretary all contract payments received by
the owner or producer during the period of the violation,
together with interest on the contract payments as determined
by the Secretary.
(b) Refund or Adjustment.--[If] Except as provided in
subsection (e), if the Secretary determines that a violation
does not warrant termination of the contract under subsection
(a), the Secretary may require the owner or producer subject to
the contract--
* * * * * * *
(d) Review.--A determination of the Secretary under this
section shall be considered to be an adverse decision for
purposes of the availability of administrative review of the
determination.
(e) Planting Flexibility.--In the case of a first violation
of section 118(b) by an eligible owner or producer that has
entered into a contract and that acted in good faith, in lieu
of terminating the contract under subsection (a), the Secretary
shall require a refund or reduce a future contract payment
under subsection (b) in an amount that does not exceed twice
the amount otherwise payable under the contract on the number
of acres involved in the violation.
* * * * * * *
SEC. 118. PLANTING FLEXIBILITY.
(a) Permitted Crops.--Subject to subsection (b), any
commodity or crop may be planted on contract acreage on a farm.
(b) Limitations and Exceptions Regarding Fruits and
Vegetables.--
[(1) Limitations.--The planting of fruits and
vegetables (other than lentils, mung beans, and dry
peas) shall be prohibited on contract acreage.]
(1) Limitations.--The planting of the following
agricultural commodities shall be prohibited on
contract acreage:
(A) Fruits.
(B) Vegetables (other than lentils, mung
beans, dry peas, and chickpeas).
(C) In the case of the 2003 and subsequent
crops of an agricultural commodity, wild rice.
(2) Exceptions.--Paragraph (1) shall not limit the
planting of a fruit or vegetable--
(A) in any region in which there is a history
of double-cropping of contract commodities with
fruits or vegetables, as determined by the
Secretary, in which case the double-cropping
shall be permitted;
(B) on a farm that the Secretary determines
has a history of planting fruits or vegetables
on contract acreage, except that a contract
payment shall be reduced by an acre for each
acre planted to the fruit or vegetable; or
(C) by a producer who the Secretary
determines has an established planting history
of a specific fruit or vegetable, except that--
(i) the quantity planted may not
exceed the producer's average annual
planting history of the fruit or
vegetable in the [1991 through 1995]
1996 through 2001 crop years (excluding
any crop year in which no plantings
were made), as determined by the
Secretary; and
(ii) a contract payment shall be
reduced by an acre for each acre
planted to the fruit or vegetable.
* * * * * * *
SEC. 131. AVAILABILITY OF NONRECOURSE MARKETING ASSISTANCE LOANS.
* * * * * * *
(a) Nonrecourse Loans Available.--For each of the 1996
through [2002] 2006 crops of each loan commodity, the Secretary
shall make available to producers on a farm nonrecourse
marketing assistance loans for loan commodities produced on the
farm. The loans shall be made under terms and conditions that
are prescribed by the Secretary and at the loan rate
established under section 132 for the loan commodity.
[(b) Eligible Production.--The following production shall
be eligible for a marketing assistance loan under subsection
(a):
[(1) In the case of a marketing assistance loan for a
contract commodity, any production by a producer on a
farm containing eligible cropland covered by a
production flexibility contract.
[(2) In the case of a marketing assistance loan for
extra long staple cotton and oilseeds, any production.]
(b) Eligible Production.--The producers on a farm shall be
eligible for a marketing loan under subsection (a) for any
quantity of a loan commodity produced on the farm.
* * * * * * *
[SEC. 132. LOAN RATES FOR MARKETING ASSISTANCE LOANS.
[(a) Wheat.--
[(1) Loan rate.--Subject to paragraph (2), the loan
rate for a marketing assistance loan under section 131
for wheat shall be--
[(A) not less than 85 percent of the simple
average price received by producers of wheat,
as determined by the Secretary, during the
marketing years for the immediately preceding 5
crops of wheat, excluding the year in which the
average price was the highest and the year in
which the average price was the lowest in the
period; but
[(B) not more than $2.58 per bushel.
[(2) Stocks to use ratio adjustment.--If the
Secretary estimates for any marketing year that the
ratio of ending stocks of wheat to total use for the
marketing year will be--
[(A) equal to or greater than 30 percent, the
Secretary may reduce the loan rate for wheat
for the corresponding crop by an amount not to
exceed 10 percent in any year;
[(B) less than 30 percent but not less than
15 percent, the Secretary may reduce the loan
rate for wheat for the corresponding crop by an
amount not to exceed 5 percent in any year; or
[(C) less than 15 percent, the Secretary may
not reduce the loan rate for wheat for the
corresponding crop.
[(b) Feed Grains.--
[(1) Loan rate for corn.--Subject to paragraph (2),
the loan rate for a marketing assistance loan under
section 131 for corn shall be--
[(A) not less than 85 percent of the simple
average price received by producers of corn, as
determined by the Secretary, during the
marketing years for the immediately preceding 5
crops of corn, excluding the year in which the
average price was the highest and the year in
which the average price was the lowest in the
period; but
[(B) not more than $1.89 per bushel.
[(2) Stocks to use ratio adjustment.--If the
Secretary estimates for any marketing year that the
ratio of ending stocks of corn to total use for the
marketing year will be--
[(A) equal to or greater than 25 percent, the
Secretary may reduce the loan rate for corn for
the corresponding crop by an amount not to
exceed 10 percent in any year;
[(B) less than 25 percent but not less than
12.5 percent, the Secretary may reduce the loan
rate for corn for the corresponding crop by an
amount not to exceed 5 percent in any year; or
[(C) less than 12.5 percent, the Secretary
may not reduce the loan rate for corn for the
corresponding crop.
[(3) Other feed grains.--The loan rate for a
marketing assistance loan under section 131 for grain
sorghum, barley, and oats, respectively, shall be
established at such level as the Secretary determines
is fair and reasonable in relation to the rate that
loans are made available for corn, taking into
consideration the feeding value of the commodity in
relation to corn.
[(c) Upland Cotton.--
[(1) Loan rate.--Subject to paragraph (2), the loan
rate for amarketing assistance loan under section 131
for upland cotton shall be established by the Secretary at such loan
rate, per pound, as will reflect for the base quality of upland cotton,
as determined by the Secretary, at average locations in the United
States a rate that is not less than the smaller of--
[(A) 85 percent of the average price
(weighted by market and month) of the base
quality of cotton as quoted in the designated
United States spot markets during 3 years of
the 5-year period ending July 31 of the year
preceding the year in which the crop is
planted, excluding the year in which the
average price was the highest and the year in
which the average price was the lowest in the
period; or
[(B) 90 percent of the average, for the 15-
week period beginning July 1 of the year
preceding the year in which the crop is
planted, of the 5 lowest-priced growths of the
growths quoted for Middling 1 3/3inch cotton
C.I.F. Northern Europe (adjusted downward by
the average difference during the period April
15 through October 15 of the year preceding the
year in which the crop is planted between the
average Northern European price quotation of
such quality of cotton and the market
quotations in the designated United States spot
markets for the base quality of upland cotton),
as determined by the Secretary.
[(2) Limitations.--The loan rate for a marketing
assistance loan for upland cotton shall not be less
than $0.50 per pound or more than $0.5192 per pound.
[(d) Extra Long Staple Cotton.--The loan rate for a
marketing assistance loan under section 131 for extra long
staple cotton shall be--
[(1) not less than 85 percent of the simple average
price received by producers of extra long staple
cotton, as determined by the Secretary, during 3 years
of the 5-year period ending July 31 of the year
preceding the year in which the crop is planted,
excluding the year in which the average price was the
highest and the year in which the average price was the
lowest in the period; but
[(2) not more than $0.7965 per pound.
[(e) Rice.--The loan rate for a marketing assistance loan
under section 131 for rice shall be $6.50 per hundredweight.
[(f) Oilseeds.--
[(1) Soybeans.--The loan rate for a marketing
assistance loan under section 131 for soybeans shall
be--
[(A) not less than 85 percent of the simple
average price received by producers of
soybeans, as determined by the Secretary,
during the marketing years for the immediately
preceding 5 crops of soybeans, excluding the
year in which the average price was the highest
and the year in which the average price was the
lowest in the period; but
[(B) not less than $4.92 or more than $5.26
per bushel.
[(2) Sunflower seed, canola, rapeseed, safflower,
mustard seed, and flaxseed.--The loan rate for a
marketing assistance loan under section 131 for
sunflower seed, canola, rapeseed, safflower, mustard
seed, and flaxseed, individually, shall be--
[(A) not less than 85 percent of the simple
average price received by producers of
sunflower seed, individually, as determined by
the Secretary, during the marketing years for
the immediately preceding 5 crops of sunflower
seed, individually, excluding the year in which
the average price was the highest and the year
in which the average price was the lowest in
the period; but
[(B) not less than $0.087 or more than $0.093
per pound.
[(3) Other oilseeds.--The loan rates for a marketing
assistance loan under section 131 for other oilseeds
shall be established at such level as the Secretary
determines is fair and reasonable in relation to the
loan rate available for soybeans, except in no event
shall the rate for the oilseeds (other than cottonseed)
be less than the rate established for soybeans on a
per-pound basis for the same crop.]
SEC. 132. LOAN RATES.
(a) In General.--Subject to subsection (b), the loan rate
for a marketing assistance loan under section 131 for a loan
commodity shall be--
(1) in the case of wheat, $3.00 per bushel;
(2) in the case of corn, $2.08 per bushel;
(3) in the case of grain sorghum, $2.08 per bushel;
(4) in the case of barley, $2.00 per bushel;
(5) in the case of oats, $1.50 per bushel;
(6) in the case of upland cotton, $0.55 per pound;
(7) in the case of extra long staple cotton, $0.7965
per pound;
(8) in the case of rice, $6.85 per hundredweight;
(9) in the case of soybeans, $5.20 per bushel;
(10) in the case of oilseeds (other than soybeans),
$0.095per pound;
(11) in the case of graded wool, $1.00 per pound;
(12) in the case of nongraded wool, $.40 per pound;
(13) in the case of mohair, $2.00 per pound;
(14) in the case of honey, $.60 per pound;
(15) in the case of dry peas, $6.78 per
hundredweight;
(16) in the case of lentils, $12.79 per
hundredweight;
(17) in the case of large chickpeas, $17.44 per
hundredweight; and
(18) in the case of small chickpeas, $8.10 per
hundredweight.
(b) Adjustments.--
(1) In general.--The Secretary may make appropriate
adjustments in the loan rates for any loan commodity
for differences in grade, type, quality, location, and
other factors.
(2) Manner.--The adjustments under this subsection
shall, to the maximum extent practicable, be made in
such manner that the average loan rate for the loan
commodity will, on the basis of the anticipated
incidence of the factors described in paragraph (1), be
equal to the loan rate provided under this section.
[SEC. 133. TERM OF LOANS.
[(a) Term of Loan.--In the case of each loan commodity
(other than upland cotton or extra long staple cotton), a
marketing assistance loan under section 131 shall have a term
of 9 months beginning on the first day of the first month after
the month in which the loan is made.
[(b) Special Rule for Cotton.--A marketing assistance loan
for upland cotton or extra long staple cotton shall have a term
of 10 months beginning on the first day of the month in which
the loan is made.
[(c) Extensions Prohibited.--The Secretary may not extend
the term of a marketing assistance loan for any loan
commodity.]
SEC. 133. TERM OF LOANS.
``In the case of each loan commodity, a marketing loan
under section 131 shall have a term of 9 months beginning on
the first day of the first month after the month in which the
loan is made.
SEC. 134. REPAYMENT OF LOANS.
(a) Repayment Rates for Wheat, Feed Grains, and Oilseeds.--
The Secretary shall permit a producer to repay a marketing
assistance loan under section 131 for [wheat, corn, grain
sorghum, barley, oats, and oilseeds] a loan commodity (other
than upland cotton, rice, and extra long staple cotton) at a
rate that is the lesser of--
(1) the loan rate established for the commodity under
section 132, plus interest (as determined by the
Secretary); or
(2) a rate that the Secretary determines will--
(A) minimize potential loan forfeitures;
(B) minimize the accumulation of stocks of
the commodity by the Federal Government;
(C) minimize the cost incurred by the Federal
Government in storing the commodity; [and]
(D) allow the commodity produced in the
United States to be marketed freely and
competitively, both domestically and
internationally[.]; and
(E) minimize discrepancies in marketing loan
benefits across State boundaries and across
county boundaries.
* * * * * * *
SEC. 135. LOAN DEFICIENCY
* * * * * * *
[(a) Availability of Loan Deficiency Payments.--Except as
provided in subsection (d), the Secretary may make loan
deficiency payments available to--
[(1) producers who, although eligible to obtain a
marketing assistance loan under section 131 with
respect to a loan commodity, agree to forgo obtaining
the loan for the commodity in return for payments under
this section; and
[(2) effective only for the 2000 crop year, producers
that, although not eligible to obtain such a marketing
assistance loan under section 131, produce a contract
commodity.]
(a) In General.--The Secretary may make loan deficiency
paymentsavailable to producers on a farm that, although
eligible to obtain a marketing assistance loan under section 131 with
respect to a loan commodity, agree to forgo obtaining the loan for the
loan commodity in return for payments under this section.
(b) Computation.--A loan deficiency payment under this
section shall be computed by multiplying--
(1) the loan payment rate determined under subsection
(c) for the loan commodity; by
(2) the quantity of the loan commodity produced by
the eligible producers, excluding any quantity for
which the producers obtain a loan under section 131.
(c) Loan Payment Rate.--For purposes of this section, the
loan payment rate shall be the amount by which--
(1) the loan rate established under section 132 for
the loan commodity; exceeds
(2) the rate at which a loan for the commodity may be
repaid under section 134.
(d) Exception for Extra Long Staple Cotton.--This section
shall not apply with respect to extra long staple cotton.
[(e) Transition.--A payment to a producer eligible for a
payment under subsection (a)(2) that harvested a commodity on
or before the date that is 30 days after the promulgation of
the regulations implementing subsection (a)(2) shall be
determined as the date the producer lost beneficial interest in
the commodity, as determined by the Secretary. Subsecs. (e) and
(f) added by sec. 206(c) of P.L. 106-224, 114 Stat. 405, June
20, 2000.
[(f) Beneficial Interest.--Subject to subsection (e), a
producer shall be eligible for a payment under this section
only if the producer has a beneficial interest in the
commodity, as determined by the Secretary.]
(e) Beneficial Interest.--
(1) In general.--A producer shall be eligible for a
payment for a loan commodity under this section only if
the producer has a beneficial interest in the loan
commodity, as determined by the Secretary.
(2) Application.--The Secretary shall make a payment
under this section to the producers on a farm with
respect to a quantity of a loan commodity as of the
earlier of--
(A) the date on which the producers on the
farm marketed or otherwise lost beneficial
interest in the loan commodity, as determined
by the Secretary; or
(B) the date the producers on the farm
request the payment.
* * * * * * *
SEC. 136. SPECIAL MARKETING LOAN PROVISIONS FOR UPLAND COTTON.
* * * * * * *
(1) Issuance.--During the period ending July 31,
[2003] 2007, the Secretary shall issue marketing
certificates or cash payments, at the option of the
recipient, to domestic users and exporters for
documented purchases by domestic users and sales for
export by exporters made in the week following a
consecutive 4-week period in which--
* * * * * * *
SEC. 136A. SPECIAL COMPETITIVE PROVISIONS FOR EXTRA LONG STAPLE COTTON.
(a) Competitiveness Program.--Notwithstanding any other
provision of law, during the period beginning on October 1,
1999, and ending on July 31, [2003] 2007, the Secretary shall
carry out a program to maintain and expand the domestic use of
extra long staple cotton produced in the United States, to
increase exports of extra long staple cotton produced in the
United States, and to ensure that extra long staple cotton
produced in the United States remains competitive in world
markets.
* * * * * * *
SEC. 137. AVAILABILITY OF RECOURSE LOANS FOR HIGH MOISTURE FEED GRAINS
AND SEED COTTON AND OTHER FIBERS.
(a) High Moisture Feed Grains.--
(1) Recourse loans available.--For each of the 1996
through [2002] 2006 crops of corn and grain sorghum,
the Secretary shall make available recourse loans, as
determined by the Secretary, to producers on a farm
containing eligible cropland covered by a production
flexibility contract who--
* * * * * * *
(3) High moisture state defined.--In this subsection,
the term ``high moisture state'' means corn or grain
sorghum having a moisture content in excess of
Commodity Credit Corporation standards for marketing
assistance loans made by the Secretary under section
131.
(b) Recourse Loans Available for Seed Cotton.--
(1) Upland cotton.--For each of the 1996 through
[2002] 2006 crops of upland cotton, the Secretary shall
make available recourse seed cotton loans, as
determined by the Secretary, to producers on a farm
containing eligible cropland covered by a production
flexibility contract.
(2) Extra long staple cotton.--For each of the 1996
through [2002] 2006 crops of extra long staple cotton,
the Secretary shall make available recourse seed cotton
loans, as determined by the Secretary, on any
production.
* * * * * * *
Subtitle D--Other Commodities
CHAPTER 1--DAIRY
SEC. 141. MILK PRICE SUPPORT PROGRAM.
* * * * * * *
(h) Period of Effectiveness.--This section (other than
subsection (g)) shall be effective only during the period
beginning on the first day of the first month beginning after
the date of enactment of this title and ending on December 31,
[2001] 2006. The program authorized by this section shall
terminate on December 31, [2001] 2006, and shall be considered
to have expired notwithstanding section 257 of the Balanced
Budget and Emergency Deficit Control Act of 1985 (2 U.S.C.
907).
[SEC. 142. RECOURSE LOAN PROGRAM FOR COMMERCIAL PROCESSORS OF DAIRY
PRODUCTS.
[(a) Recourse Loans Available.--Under such reasonable terms
and conditions as the Secretary may prescribe, the Secretary
shall make recourse loans available to commercial processors of
eligible dairy products to assist the processors to manage
inventories of eligible dairy products and assure a greater
degree of price stability for the dairy industry during the
year. The Secretary shall use the funds, facilities, and
authorities of the Commodity Credit Corporation to carry out
this section.
[(b) Amount of Loan.--The Secretary shall establish the
amount of a loan for eligible dairy products, which shall
reflect a milk equivalent value of $9.90 per hundredweight of
milk containing 3.67 percent butterfat. The rate of interest
charged participants under this section shall not be less than
the rate of interest charged the Commodity Credit Corporation
by the United States Treasury.
[(c) Period of Loan.--The original term of a recourse loan
made under this section may not extend beyond the end of the
fiscal year in which the loan is made. At the end of the fiscal
year, the Secretary may extend the loan for an additional
period not to exceed the end of the next fiscal year.
[(d) Definition of Eligible Dairy Products.--In this
section, the term ``eligible dairy products'' means cheddar
cheese, butter, and nonfat dry milk.
[(e) Effective Date.--This section shall be effective
beginning January 1, 2002.
[Sec. 807(b) of the Agriculture, Rural Development, Food
and Drug Administration, and Related Agencies Appropriations
Act, 2000 (7 U.S.C. 1421 note; P.L. 106-78; 113 Stat. 1181;
Oct. 22, 1999) amended this subsec. by striking ``2000'' and
inserting ``2001''. Sec. 742(b) of the Agriculture, Rural
Development, Food and Drug Administration, and Related Agencies
Appropriations Act, 2001 (P.L. 106-387; 114 Stat. 1549, 1549A-
35; Oct. 28, 2000) amended this subsec. by striking ``2001''
and inserting ``2002''.]
SEC. 142. NATIONAL DAIRY PROGRAM.
(a) Purpose.--The purpose of this section is to establish a
program that will stabilize the production, price, and
marketing of milk and other dairy products in the United
States, which is critical to the welfare of the United States.
(b) Definitions.--In this section:
(1) Class i, ii, iii, and iv milk.--The terms ``Class
I milk'', ``Class II milk'', ``Class III milk'', and
``Class IV milk'' mean milk (including milk components)
classified as Class I, II, III, or IV milk,
respectively, under a Federal milk marketing order.
(2) Eligible production.--The term ``eligible
production'' means, with respect to each producer that
operates a dairy farming operation, the lesser of--
(A) the quantity of milk sold by the dairy
farming operation under any Federal milk
marketing order during the applicable month; or
(B) 500,000 pounds of milk per month.
(3) Federal milk marketing order.--The term ``Federal
milk marketing order'' means an order issued under
section 8c of the Agricultural Adjustment Act (7 U.S.C.
608c), reenacted with amendments by the Agricultural
Marketing Agreement Act of 1937.
(4) Marketing area.--The term ``marketing area''
means a marketing area defined under a Federal milk
marketing order.
(5) Producer.--The term ``producer'' means an
individual or entity that directly or indirectly (as
determined by the Secretary)--
(A) shares in the risk of producing milk; and
(B) makes contributions (including land,
labor, management, equipment, or capital) to
the dairy farming operation of the individual
or entity that are at least commensurate with
the individual or entity's share of the
proceeds of the operation.
(6) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture.
(c) Minimum Price.--Effective beginning January 1, 2001,
the Secretary shall amend Federal milk marketing orders to
establish a minimum price per hundredweight for Class I milk
that is not less than the sum of--
(1) the adjusted Class I milk differential specified
in section 1000.52 of title 7, Code of Federal
Regulations (or a successor regulation); and
(2) the greater of--
(A) the advanced Class III milk price (as
determined under section 1000.50(q)(4)(i) of
title 7, Code of Federal Regulations (or a
successor regulation));
(B) the advanced Class IV milk price (as
determined under section 1000.50(q)(4)(ii) of
title 7, Code of Federal Regulations (or a
successor regulation)); or
(C) $14.25.
(d) National Pooling.--Notwithstanding any other provision
of law, the Secretary--
(1) shall provide for the uniform national pooling
among producers of milk under all Federal milk
marketing orders of all funds that are equal to the
difference between--
(A) the price of Class I milk as determined
under this section; and
(B) the price of Class I milk that would be
determined if this section were not in effect;
(2) subject to subsection (e), shall provide for the
distribution of amounts described in paragraph (1) to
all producers covered by Federal milk marketing orders,
based on eligible production under Federal milk
marketing orders, at a uniform rate per hundredweight;
and
(3) may make such modifications in the operation of
Federal milk marketing orders as are necessary to carry
out this section.
(e) Administrative and Food Assistance Costs.--The
Secretary shall use amounts described in subsection (d)(1) to
provide compensation to--
(1) the Secretary for--
(A) administrative costs incurred by the
Secretary in carrying out subsections (c) and
(d); and
(B) the increased costs incurred by the
Secretary of any milk and milk products provided
under any food assistance program administered
by the Secretary that results from carrying out
subsections (c) and (d);
(2) each State for the increased costs incurred by
the State of any milk and milk products provided under
the special supplemental nutrition program for women,
infants, and children established by section 17 of the
Child Nutrition Act of 1966 (42 U.S.C. 1786) that
results from carrying out subsections (c) and (d); and
(3) the Commodity Credit Corporation for any
additional costs for a fiscal year to carry out section
141 as a result of increased production of milk in a
marketing area that results from carrying out
subsections (c) and (d).
(f) Counter-Cyclical Payments From Secretary to
Producers.--
(1) In general.--Subject to paragraph (3), if the
average price for Class III milk during a month is less
than $14.25 per hundredweight, the Secretary shall use
the funds of the Commodity Credit Corporation in such
amounts as may be necessary to make a payment to each
producer for eligible production of milk in an amount
determined by multiplying--
(A) the payment rate determined under
paragraph (2); by
(B) the quantity of Class II, Class III, and
Class IV milk produced by the producer during
the month, as determined by the Secretary.
(2) Payment rate.--The payment rate for a payment
made to a producer for a month under paragraph (1)(A)
shall equal 25 percent of the difference between--
(A) $14.25 per hundredweight; and
(B) the average price for Class III milk
during the month, as determined by the
Secretary.
(3) Maximum amount of payments.--The total amount of
payments made to producers for a fiscal year under this
subsection shall not exceed $300,000,000.
* * * * * * *
SEC. 152. PROMOTION OF UNITED STATES DAIRY PRODUCTS IN INTERNATIONAL
MARKETS THROUGH DAIRY PROMOTION PROGRAM.
CHAPTER 2--[PEANUTS AND] SUGAR
SEC. 155. PEANUT PROGRAM.
[(a) Quota Peanuts.--
[(1) Availability of loans.--The Secretary shall make
nonrecourse loans available to producers of quota
peanuts.
[(2) Loan rate.--The national average quota loan rate
for quota peanuts shall be $610 per ton.
[(3) Inspection, handling, or storage.--The loan
amount may not be reduced by the Secretary by any
deductions for inspection, handling, or storage.
[(4) Location and other factors.--The Secretary may
make adjustments in the loan rate for quota peanuts for
location of peanuts and such other factors as are
authorized by section 162.
[(5) Offers from handlers.--If a producer markets a
quota peanut crop, meeting quality requirements for
domestic edible use, through the marketing association
loan for two consecutive marketing years and the
Secretary determines that a handler provided the
producer with a written offer, upon delivery, for the
purchase of the quota peanut crops at a price equal to
or in excess of the quota support price, the producer
shall be ineligible for quota price support for the
next marketing year. The Secretary shall establish the
method by which a producer may appeal a determination
under this paragraph regarding ineligibility for quota
price support.
[(b) Additional Peanuts.--
[(1) In general.--Subject to paragraph (2), the
Secretary shall make nonrecourse loans available to
producers of additional peanuts at such rates as the
Secretary finds appropriate, taking into consideration
the demand for peanut oil and peanut meal, expected
prices of other vegetable oils and protein meals,
and the demand for peanuts in foreign markets.
[(2) Limitation.--The Secretary shall establish the
support rate on additional peanuts at a level estimated
by the Secretary to ensure that there are no losses to
the Commodity Credit Corporation on the sale or
disposal of the peanuts.
[(3) Announcement.--The Secretary shall announce the
loan rate for additional peanuts of each crop not later
than February 15 preceding the marketing year for the
crop for which the loan rate is being determined.
[(c) Area Marketing Associations.--
[(1) Warehouse storage loans.--
[(A) In general.--In carrying out subsections
(a) and (b), the Secretary shall make warehouse
storage loans available in each of the
producing areas (described in section 1446.95
of title 7 of the Code of Federal Regulations
(January 1, 1989)) to a designated area
marketing association of peanut producers that
is selected and approved by the Secretary and
that is operated primarily for the purpose of
conducting the loan activities. The Secretary
may not make warehouse storage loans available
to any cooperative that is engaged in
operations or activities concerning peanuts
other than those operations and activities
specified in this section and section 358e of
the Agricultural Adjustment Act of 1938 (7
U.S.C. 1359a).
[(B) Administrative and supervisory
activities.--An area marketing association
shall be used in administrative and supervisory
activities relating to loans and marketing
activities under this section and section 358e
of the Agricultural Adjustment Act of 1938 (7
U.S.C. 1359a).
[(C) Association costs.--Loans made to the
association under this paragraph shall include
such costs as the area marketing association
reasonably may incur in carrying out the
responsibilities, operations, and activities of
the association under this section and section
358e of the Agricultural Adjustment Act of 1938
(7 U.S.C. 1359a).
[(2) Pools for quota and additional peanuts.--
[(A) In general.--The Secretary shall require
that each area marketing association establish
pools and maintain complete and accurate
records by area and segregation for quota
peanuts handled under loan and for additional
peanuts placed under loan, except that separate
pools shall be established for Valencia peanuts
produced in New Mexico.
[(B) Eligibility to participate in new mexico
pools.--
[(i) In general.--Except as provided
in clause (ii), in the case of the 1996
and subsequent crops, Valencia peanuts
not physically produced in the State of
New Mexico shall not be eligible to
participate in the pools of the State.
[(ii) Exception.--A producer of
Valencia peanuts may enter Valencia
peanuts that are produced in Texas into
the pools of New Mexico in a quantity
not greater than the average annual
quantity of the peanuts that the
producer entered into the New Mexico
pools for the 1990 through 1995 crops.
[(C) Types of peanuts.--Bright hull and dark
hull Valencia peanuts shall be considered as
separate types for the purpose of establishing
the pools.
[(D) Net gains.--Net gains on peanuts in each
pool, unless otherwise approved by the
Secretary, shall be distributed only to
producers who placed peanuts in the pool and
shall be distributed in proportion to the value
of the peanuts placed in the pool by each
producer. Net gains for peanuts in each pool
shall consist of the following:
[(i) Quota peanuts.--For quota
peanuts, the net gains over and above
the loan indebtedness and other costs
or losses incurred on peanuts placed in
the pool.
[(ii) Additional peanuts.--For
additional peanuts, the net gains over
and above the loan indebtedness and
other costs or losses incurred on
peanuts placed in the pool for
additional peanuts.
[(d) Losses.--Losses in quota area pools shall be covered
using the following sources in the following order of priority:
[(1) Transfers from additional loan pools.--The
proceeds due any producer from any pool shall be
reduced by the amount of any loss that is incurred with
respect to peanuts transferred from an additional loan
pool to a quota loan pool by the producer under section
358-1(b)(8) of the Agricultural Adjustment Act of 1938
(7 U.S.C. 1358-1(b)(8)).
[(2) Producers in same pool.--Further losses in an
area quota pool shall be offset by reducing the gain of
any producer in the pool by the amount of pool gains
attributed to the same producer from the sale of
additional peanuts for domestic and edible export use.
[(3) Offset within area.--Further losses in an area
quota pool shall be offset by any gains or profits from
additional peanuts (other than separate type pools
established under subsection (c)(2)(A) for Valencia
peanuts produced in New Mexico) owned or controlled by
the Commodity Credit Corporation in that area and sold
for domestic edible use, in accordance with regulations
issued by the Secretary. This paragraph shall not apply
to profits or gains from a farm with 1 acre or less of
peanut production.
[(4) First use of marketing assessments.--The
Secretary shall use funds collected under subsection
(g) (except funds attributable to handlers) to offset
further losses in area quota pools. The Secretary shall
transfer to the Treasury those funds collected under
subsection (g) and available for use under this
paragraph that the Secretary determines are not
required to cover losses in area quota pools.
[(5) Cross compliance.--Further losses in area quota
pools, other than losses incurred as a result of
transfers from additional loan pools to quota loan
pools under section 358-1(b)(8) of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1358-1(b)(8)), shall
be offset by any gains or profits from quota pools in
other production areas (other than separate type pools
established under subsection (c)(2)(A) for Valencia
peanuts produced in New Mexico) in such manner as the
Secretary shall by regulation prescribe.
[(6) Offset generally.--If losses in an area quota
pool have not been entirely offset under the preceding
paragraphs, further losses shall be offset by any gains
or profits from additional peanuts (other than separate
type pools established under subsection (c)(2)(A) for
Valencia peanuts produced in New Mexico) owned or
controlled by the Commodity Credit Corporation and sold
for domestic edible use, in accordance with regulations
issued by the Secretary. This paragraph shall not apply
to profits or gains from a farm with 1 acre or less of
peanut production.
[(7) Second use of marketing assessments.--The
Secretary shall use funds collected under subsection
(g) and attributable to handlers to offset further
losses in area quota pools. The Secretary shall
transfer to the Treasury those funds collected under
subsection (g) and available for use under this
paragraph that the Secretary determines are not
required to cover losses in area quota pools.
[(8) Increased assessments.--If use of the
authorities provided in the preceding paragraphs is not
sufficient to cover losses in an area quota pool, the
Secretary shall increase the marketing assessment for
producers established under subsection (g) by such an
amount as the Secretary considers necessary to cover
the losses. The increased assessment shall apply only
to quota peanuts in the production area covered by the
pool. Amounts collected under subsection (g) as a
result of the increased assessment shall be retained by
the Secretary to cover losses in that pool.
[(e) Disapproval of Quotas.--Notwithstanding any other
provision of law, no loan for quota peanuts may be made
available by the Secretary for any crop of peanuts with respect
to which poundage quotas have been disapproved by producers, as
provided for in section 358-1(d) of the Agricultural Adjustment
Act of 1938 (7 U.S.C. 1358-1(d)).
[(f) Quality Improvement.--
[(1) In general.--With respect to peanuts under loan,
the Secretary shall--
[(A) promote the crushing of peanuts at a
greater risk of deterioration before peanuts of
a lesser risk of deterioration;
[(B) ensure that all Commodity Credit
Corporation inventories of peanuts sold for
domestic edible use must be shown to have been
officially inspected by licensed Department
inspectors both as farmer stock and shelled or
cleaned in-shell peanuts;
[(C) continue to endeavor to operate the
peanut program so as to improve the quality of
domestic peanuts and ensure the coordination of
activities under the Peanut Administrative
Committee established under Marketing Agreement
No. 146, regulating the quality of domestically
produced peanuts (under the Agricultural
Adjustment Act (7 U.S.C. 601 et seq.),
reenacted with amendments by the Agricultural
Marketing Agreement Act of 1937); and
[(D) ensure that any changes made in the
peanut program as a result of this subsection
requiring additional production or handling at
the farm level shall be reflected as an upward
adjustment in the Department loan schedule.
[(2) Exports and other peanuts.--The Secretary shall
require that all peanuts in the domestic and export
markets fully comply with all quality standards under
Marketing Agreement No. 146.
[(g) Marketing Assessment.--
[(1) In general.--The Secretary shall provide for a
nonrefundable marketing assessment. The assessment
shall be made on a per pound basis in an amount equal
to 1.1 percent for each of the 1994 and 1995 crops,
1.15 percent for the 1996 crop, and 1.2 percent for
each of the 1997 through 2002 crops, of the national
average quota or additional peanut loan rate for the
applicable crop.
[(2) First purchasers.--
[(A) In general.--Except as provided under
paragraphs (3) and (4), the first purchaser of
peanuts shall--
[(i) collect from the producer a
marketing assessment equal to the
quantity of peanuts acquired multiplied
by--
[(I) in the case of each of
the 1994 and 1995 crops, .55
percent of the applicable
national average loan rate;
[(II) in the case of the 1996
crop, .6 percent of the
applicable national average
loan rate; and
[(III) in the case of each of
the 1997 through 2002 crops,
.65 percent of the applicable
national average loan rate;
[(ii) pay, in addition to the amount
collected under clause (i), a marketing
assessment in an amount equal to the
quantity of peanuts acquired multiplied
by .55 percent of the applicable national
average loan rate; and
[(iii) remit the amounts required
under clauses (i) and (ii) to the
Commodity Credit Corporation in a
manner specified by the Secretary.
[(B) Definition of first purchaser.--In this
subsection, the term ``first purchaser'' means
a person acquiring peanuts from a producer
except that in the case of peanuts forfeited by
a producer to the Commodity Credit Corporation,
the term means the person acquiring the peanuts
from the Commodity Credit Corporation.
[(3) Other private marketings.--In the case of a
private marketing by a producer directly to a consumer
through a retail or wholesale outlet or in the case of
a marketing by the producer outside of the continental
United States, the producer shall be responsible for
the full amount of the assessment and shall remit the
assessment by such time as is specified by the
Secretary.
[(4) Loan peanuts.--In the case of peanuts that are
pledged as collateral for a loan made under this
section, the producer portion of the assessment shall
be deducted from the proceeds of the loan. The
remainder of the assessment shall be paid by the first
purchaser of the peanuts. For purposes of computing net
gains on peanuts under this section, the reduction in
loan proceeds shall be treated as having been paid to
the producer.
[(5) Penalties.--If any person fails to collect or
remit the reduction required by this subsection or
fails to comply with the requirements for recordkeeping
or otherwise as are required by the Secretary to carry
out this subsection, the person shall be liable to the
Secretary for a civil penalty up to an amount
determined by multiplying--
[(A) the quantity of peanuts involved in the
violation; by
[(B) the national average quota peanut rate
for the applicable crop year.
[(6) Enforcement.--The Secretary may enforce this
subsection in the courts of the United States.
[(h) Crops.--Subsections (a) through (g) shall be effective
only for the 1996 through 2002 crops of peanuts.
[(i) Poundage Quotas.--]
SEC. 156. SUGAR PROGRAM.
(a) Sugarcane.--The Secretary shall make loans available to
processors of domestically grown sugarcane at a rate equal to
18 cents per pound for raw cane sugar.
(b) Sugar Beets.--The Secretary shall make loans available
to processors of domestically grown sugar beets at a rate equal
to 22.9 cents per pound for refined beet sugar.
(c) [Reduction in Loan Rates] Loan Rate Adjustments.--
(1) [Reduction required] In general.--The Secretary
[shall] may reduce the loan rate specified in
subsection (a) for domestically grown sugarcane and
subsection (b) for domestically grown sugar beets if
the Secretary determines that negotiated reductions in
export subsidies and domestic subsidies provided for
sugar of other major sugar growing, producing, and
exporting countries in the aggregate exceed the
commitments made as part of the Agreement on
Agriculture.
* * * * * * *
[(2) Processor assurances.--The Secretary shall
obtain from each processor that receives a loan under
this section such assurances as the Secretary considers
adequate to ensure that the processor will provide
payments to producers that are proportional to the
value of the loan received by the processor for sugar
beets and sugarcane delivered by producers served by
the processor. The Secretary may establish appropriate
minimum payments for purposes of this paragraph. 156-3
Sec. 836(2) and (3) of the Agriculture, Rural
Development, Food and Drug Administration, and Related
Agencies Appropriations Act, 2001 (P.L. 106-387; 114
Stat. 1549, 1549A-62; Oct. 28, 2000) struck former
para. (2) and redesignated former para. (3) as para.
(2).]
(2) Processor assurances.--
(A) In general.--The Secretary shall obtain
from each processor that receives a loan under
this section such assurances as the Secretary
considers adequate to ensure that the processor
will provide payments to producers that are
proportional to the value of the loan received
by the processor for the sugar beets and
sugarcane delivered by producers to the
processor.
(B) Minimum payments.--
(i) In general.--Subject to clause
(ii), the Secretary may establish
appropriate minimum payments for
purposes of this paragraph.
(ii) Limitation.--In the case of
sugar beets, the minimum payment
established under clause (i) shall not
exceed the rate of payment provided for
under the applicable contract between a
sugar beet producer and a sugar beet
processor.
(C) Bankruptcy or insolvency of processors.--
(i) In general.--The Secretary shall
use funds of the Commodity Credit
Corporation to pay a producer of sugar
beets or sugarcane loan benefits
described in clause (ii) if--
(I) a processor that has
entered into a contract with
the producer has filed for
bankruptcy protection or is
otherwise insolvent;
(II) the assurances under
subparagraph (A) are not
adequate to ensure compliance
with subparagraph (A), as
determined by the Secretary;
(III) the producer demands
payments of loan benefits
required under this section
from the processor; and
(IV) the Secretary determines
that the processor is unable to
provide the loan benefits
required under this section.
(ii) Amount.--The amount of loan
benefits provided to a producer under
clause (i) shall be equal to--
(I) the maximum amount of
loan benefits the producer
would have been entitled to
receive under this section
during the 30-day period
beginning on the final
settlement date provided for in
the contract between the
producer and processor; less
(II) any such benefits
received by the producer from
the processor.
(iii) Administration.--On payment to
a producer under clause (i), the
Secretary shall--
(I) be subrogated to all
claims of the producer against
the processor and other persons
responsible for nonpayment; and
(II) have authority to pursue
such claims as are necessary to
recover the benefits not paid
to the producer by the
processor.
(3) Administration.--The Secretary may not impose or
enforce any prenotification or similar administrative
requirement that has the effect of preventing a
processor from electing to forfeit the loan collateral
on the maturity of the loan.
[(1) Sugarcane.--Effective for marketings of raw cane
sugar during the 1996 through 2003 fiscal years, the
first processor of sugarcane shall remit to the
Commodity Credit Corporation a nonrefundable marketing
assessment in an amount equal to--
[(A) in the case of marketings during fiscal
year 1996, 1.1 percent of the loan rate
established under subsection (a) per pound of
raw cane sugar, processed by the processor from
domestically produced sugarcane or sugarcane
molasses, that has been marketed (including the
transfer or delivery of the sugar to a refinery
for further processing or marketing); and
[(B) in the case of marketings during each of
fiscal years 1997 through 2003, 1.375 percent
of the loan rate established under subsection
(a) per pound of raw cane sugar, processed by
the processor from domestically produced
sugarcane or sugarcane molasses, that has been
marketed (including the transfer or delivery of
the sugar to a refinery for further processing
or marketing).
[(2) Sugar beets.--Effective for marketings of beet
sugar during the 1996 through 2003 fiscal years, the
first processor of sugar beets shall remit to the
Commodity Credit Corporation a nonrefundable marketing
assessment in an amount equal to--
[(A) in the case of marketings during fiscal
year 1996, 1.1794 percent of the loan rate
established under subsection (a) per pound of
beet sugar, processed by the processor from
domestically produced sugar beets or sugar beet
molasses, that has been marketed; and
[(B) in the case of marketings during each of
fiscal years 1997 through 2003, 1.47425 percent
of the loan rate established under subsection
(a) per pound of beet sugar, processed by the
processor from domestically produced sugar
beets or sugar beet molasses, that has been
marketed.
[(3) Collection.--
[(A) Timing.--A marketing assessment required
under this subsection shall be collected on a
monthly basis and shall be remitted to the
Commodity Credit Corporation not later than
30 days after the end of each month. Any cane
sugar or beet sugar processed during a fiscal year
that has not been marketed by September 30 of the
year shall be subject to assessment on that date.
The sugar shall not be subject to a second
assessment at the time that it is marketed.
[(B) Manner.--Subject to subparagraph (A),
marketing assessments shall be collected under
this subsection in the manner prescribed by the
Secretary and shall be nonrefundable.
[(4) Penalties.--If any person fails to remit the
assessment required by this subsection or fails to
comply with such requirements for recordkeeping or
otherwise as are required by the Secretary to carry out
this subsection, the person shall be liable to the
Secretary for a civil penalty up to an amount
determined by multiplying--
[(A) the quantity of cane sugar or beet sugar
involved in the violation; by
[(B) the loan rate for the applicable crop of
sugarcane or sugar beets.
[(5) Enforcement.--The Secretary may enforce this
subsection in a court of the United States.
[(g) Forfeiture Penalty.--
[(1) In general.--A penalty shall be assessed on the
forfeiture of any sugar pledged as collateral for a
nonrecourse loan under this section.
[(2) Cane sugar.--The penalty for cane sugar shall be
1 cent per pound.
[(3) Beet sugar.--The penalty for beet sugar shall
bear the same relation to the penalty for cane sugar as
the marketing assessment for sugar beets bears to the
marketing assessment for sugarcane.
[(4) Effect of forfeiture.--Any payments owed
producers by a processor that forfeits any sugar
pledged as collateral for a nonrecourse loan shall be
reduced in proportion to the loan forfeiture penalty
incurred by the processor.]
(f) Loans for In-Process Sugar.--
(1) Definition of in-process sugars and syrups.--In
this subsection, the term ``in-process sugars and
syrups'' does not include raw sugar, liquid sugar,
invert sugar, invert syrup, or other finished product
that is otherwise eligible for a loan under subsection
(a) or (b).
(2) Availability.--The Secretary shall make
nonrecourse loans available to processors of a crop of
domestically grown sugarcane and sugar beets for in-
process sugars and syrups derived from the crops.
(3) Loan rate.--The loan rate shall be equal to 80
percent of the loan rate applicable to raw cane sugar
or refined beet sugar, as determined by the Secretary
on the basis of the source material for the in-process
sugars and syrups.
(4) Further processing on forfeiture.--
(A) In general.--As a condition of the
forfeiture of in-process sugars and syrups
serving as collateral for a loan under
paragraph (2), the processor shall, within such
reasonable time period as the Secretary may
prescribe and at no cost to the Commodity
Credit Corporation, convert the in-process
sugars and syrups into raw cane sugar or
refined beet sugar of acceptable grade and
quality for sugars eligible for loans under
subsection (a) or (b).
(B) Transfer to corporation.--Once the in-
process sugars and syrups are fully processed
into raw cane sugar or refined beet sugar, the
processor shall transfer the sugar to the
Commodity Credit Corporation.
(C) Payment to processor.--On transfer of the
sugar, the Secretary shall make a payment to
the processor in an amount equal to the amount
obtained by multiplying--
(i) the difference between--
(I) the loan rate for raw
cane sugar or refined beet
sugar, as appropriate; and
(II) the loan rate the
processor received under
paragraph (3); by
(ii) the quantity of sugar
transferred to the Secretary.
(5) Loan conversion.--If the processor does not
forfeit the collateral as described in paragraph (4),
but instead further processes the in-process sugars and
syrups into raw cane sugar or refined beet sugar and
repays the loan on the in-process sugars and syrups,
the processor may obtain a loan under subsection (a) or
(b) for the raw cane sugar or refined beet sugar, as
appropriate.
(g) Avoiding Forfeitures; Corporation Inventory
Disposition.--
(1) In general.--Subject to subsection (e)(3), to the
maximum extent practicable, the Secretary shall operate
the program established under this section at no cost
to the Federal Government by avoiding the forfeiture of
sugar to the Commodity Credit Corporation.
(2) Inventory disposition.--
(A) In general.--To carry out paragraph (1),
the Commodity Credit Corporation may accept
bids to obtain raw cane sugar or refined beet
sugar in the inventory of the Commodity Credit
Corporation from (or otherwise make available
such commodities, on appropriate terms and
conditions, to) processors of sugarcane and
processors of sugar beets (acting in
conjunction with the producers of the sugarcane
or sugar beets processed by the processors) in
return for the reduction of production of raw
cane sugar or refined beet sugar, as
appropriate.
(B) Additional authority.--The authority
provided under this paragraph is in addition to
any authority of the Commodity Credit
Corporation under any other law.
(h) Information Reporting.--
(1) Duty of processors and refiners to report.--A
sugarcane processor, cane sugar refiner, and sugar beet
processor shall furnish the Secretary, on a monthly
basis, such information as the Secretary may require to
administer sugar programs, including the quantity of
purchases of sugarcane, sugar beets, and sugar, and
production, importation, distribution, and stock levels
of sugar.
(2) Duty of producers to report.--
(A) Proportionate share states.--As a
condition of a loan made to a processor for the
benefit of a producer, the Secretary shall
require each producer of sugarcane located in a
State (other than the Commonwealth of Puerto
Rico) in which there are in excess of 250
producers of sugarcane to report, in the manner
prescribed by the Secretary, the sugarcane
yields and acres planted to sugarcane of the
producer.
(B) Other states.--The Secretary may require
each producer of sugarcane or sugar beets not
covered by paragraph (1) to report, in a manner
prescribed by the Secretary, the yields of, and
acres planted to sugarcane or sugar beets,
respectively, of the producer.
(3) Duty of importers to report.--
(A) In general.--Except as provided in
subparagraph (B), the Secretary shall require
an importer of sugars, syrups, or molasses to
be used for human consumption or to be used for
the extraction of sugar for human consumption
to report, in the manner prescribed by the
Secretary, the quantities of the products
imported by the importer and the sugar content
or equivalent of the products.
(B) Tariff-rate quotas.--Subparagraph (A)
shall not apply to sugars, syrups, or molasses
that are within the quantities of tariff-rate
quotas that are subject to the lower rate of
duties.
[(2)](4) Penalty.--Any person willfully failing or
refusing to furnish the information, or furnishing
willfully any false information, shall be subject to a
civil penalty of not more than $10,000 for each such
violation.
[(3)](5) Monthly reports.--Taking into consideration
the information received under [paragraph (1)] this
subsection, the Secretary shall publish on a monthly
basis composite data on production, imports,
distribution, and stock levels of sugar.
(i) Crops.--This section [(other than
subsection (f))] shall be effective
only for the 1996 through 2002 2006
crops of sugar beets and sugarcane.
SEC. 157. STORAGE FACILITY LOANS.
(a) In General.--Notwithstanding any other provision of law
and as soon as practicable after the date of enactment of this
section, the Commodity Credit Corporation shall amend part 1436
of title 7, Code of Federal Regulations, to establish a sugar
storage facility loan program to provide financing for
processors of domestically-produced sugarcane and sugar beets
to construct or upgrade storage and handling facilities for raw
sugars and refined sugars.
(b) Eligible Processors.--A storage facility loan shall be
made available to any processor of domestically produced
sugarcane or sugar beets that (as determined by the
Secretary)--
(1) has a satisfactory credit history;
(2) has a need for increased storage capacity, taking
into account the effects of marketing allotments); and
(3) demonstrates an ability to repay the loan.
(c) Term of Loans.--A storage facility loan shall--
(1) have a minimum term of 7 years; and
(2) be in such amounts and on such terms and
conditions (including terms and conditions relating to
downpayments, collateral, and eligible facilities) as
are normal, customary, and appropriate for the size and
commercial nature of the borrower.
CHAPTER 3--PEANUTS
SEC. 158A. DEFINITIONS.
In this chapter:
(1) Counter-cyclical payment.--The term ``counter-
cyclical payment'' means a payment made to peanut
producers on a farm under section 158D.
(2) Direct payment.--The term ``direct payment''
means a payment made to peanut producers on a farm
under section 158C.
(3) Effective price.--The term ``effective price''
means the price calculated by the Secretary under
section 158D for peanuts to determine whether counter-
cyclical payments are required to be made under section
158D for a crop year.
(4) Historical peanut producers on a farm.--The term
``historical peanut producers on a farm'' means the
peanut producers on a farm in the United States that
produced or were prevented from planting peanuts during
any of the 1998 through 2001 crop years.
(5) Income protection price.--The term ``income
protection price'' means the price per ton of peanuts
used to determine the payment rate for counter-cyclical
payments.
(6) Payment acres.--The term ``payment acres'' means
85 percent of the peanut acres on a farm, as
established under section 158B, on which direct
payments and counter-cyclical payments are made.
(7) Peanut acres.--The term ``peanut acres'' means
the number of acres assigned to a particular farm for
historical peanut producers on a farm pursuant to
section 158B(b).
(8) Payment yield.--The term ``payment yield'' means
the yield assigned to a farm by historical peanut
producers on the farm pursuant to section 158B(b).
(9) Peanut producer.--The term ``peanut producer''
means an owner, operator, landlord, tenant, or
sharecropper that--
(A) shares in the risk of producing a crop of
peanuts in the United States; and
(B) is entitled to share in the crop
available for marketing from the farm or would
have shared in the crop had the crop been
produced.
SEC. 158B. PAYMENT YIELDS, PEANUT ACRES, AND PAYMENT ACRES FOR FARMS.
(a) Payment Yields and Payment Acres.--
(1) Average yield.--
(A) In general.--The Secretary shall
determine, for each historical peanut producer,
the average yield for peanuts on all farms of
the historical peanut producer for the 1998
through 2001 crop years, excluding any crop
year during which the producers did not produce
peanuts.
(B) Assigned yields.--If, for any of the crop
years referred to in subparagraph (A) in which
peanuts were planted on a farm by the
historical peanut producer, the historical
peanut producer has satisfied the eligibility
criteria established to carry out section 1102
of the Agriculture, Rural Development, Food and
Drug Administration, and Related Agencies
Appropriations Act, 1999 (7 U.S.C. 1421 note;
Public Law 105-277), the Secretary shall assign
to the historical peanut producer a yield for
the farm for the crop year equal to 65 percent
of the average yield for peanuts for the
previous 5 crop years.
(2) Acreage average.--Except as provided in paragraph
(3), the Secretary shall determine, for the historical
peanut producer, the 4-year average of--
(A) acreage planted to peanuts on all farms
for harvest during the 1998 through 2001 crop
years; and
(B) any acreage that was prevented from being
planting to peanuts during the crop years
because of drought, flood, or other natural
disaster, or other condition beyond the control
of the historical peanut producer, as determined
by the Secretary.
(3) Selection by producer.--If a county in which a
historical peanut producer described in paragraph (2)
is located is declared a disaster area during 1 or more
of the 4 crop years described in paragraph (2), for
purposes of determining the 4-year average acreage for
the historical peanut producer, the historical peanut
producer may elect to substitute, for not more than 1
of the crop years during which a disaster is declared--
(A) the State average of acreage actually
planted to peanuts; or
(B) the average of acreage for the historical
peanut producer determined by the Secretary
under paragraph (2).
(4) Time for determinations; factors.--
(A) Timing.--The Secretary shall make the
determinations required by this subsection not
later than 90 days after the date of enactment
of this section.
(B) Factors.--In making the determinations,
the Secretary shall take into account changes
in the number and identity of historical peanut
producers sharing in the risk of producing a
peanut crop since the 1998 crop year, including
providing a method for the assignment of
average acres and average yield to a farm when
a historical peanut producer is no longer
living or an entity composed of historical
peanut producers has been dissolved.
(b) Assignment of Yield and Acres to Farms.--
(1) Assignment by historical peanut producers.--The
Secretary shall provide each historical peanut producer
with an opportunity to assign the average peanut yield
and average acreage determined under subsection (a) for
the historical peanut producer to cropland on a farm.
(2) Payment yield.--The average of all of the yields
assigned by historical peanut producers to a farm shall
be considered to be the payment yield for the farm for
the purpose of making direct payments and counter-
cyclical payments under this chapter.
(3) Peanut acres.--Subject to subsection (e), the
total number of acres assigned by historical peanut
producers to a farm shall be considered to be the
peanut acres for the farm for the purpose of making
direct payments and counter-cyclical payments under
this chapter.
(c) Election.--Not later than 180 days after the date of
enactment of this section, a historical peanut producer shall
notify the Secretary of the assignments described in subsection
(b).
(d) Payment Acres.--The payment acres for peanuts on a farm
shall be equal to 85 percent of the peanut acres assigned to
the farm.
(e) Prevention of Excess Peanut Acres.--
(1) Required reduction.--If the total of the peanut
acres for a farm, together with the acreage described
in paragraph (3), exceeds the actual cropland acreage
of the farm, the Secretary shall reduce the quantity of
peanut acres for the farm or contract acreage for 1 or
more covered commodities for the farm as necessary so
that the total of the peanut acres and acreage
described in paragraph (3) does not exceed the actual
cropland acreage of the farm.
(2) Selection of acres.--The Secretary shall give the
peanut producers on the farm the opportunity to select
the peanut acres or contract acreage against which the
reduction will be made.
(3) Other acreage.--For purposes of paragraph (1),
the Secretary shall include--
(A) any contract acreage for the farm under
subtitle B;
(B) any acreage on the farm enrolled in the
conservation reserve program or wetlands
reserve program under chapter 1 of subtitle D
of title XII of the Food Security Act of 1985
(16 U.S.C. 3830 et seq.); and
(C) any other acreage on the farm enrolled in
a conservation program for which payments are
made in exchange for not producing an
agricultural commodity on the acreage.
(4) Double-cropped acreage.--In applying paragraph
(1), the Secretary shall take into account additional
acreage as a result of an established double-cropping
history on a farm, asdetermined by the Secretary.
SEC. 158C. DIRECT PAYMENTS FOR PEANUTS.
(a) In General.--For each of the 2002 through 2006 fiscal
years, the Secretary shall make direct payments to peanut
producers on a farm with peanut acres under section 158B and a
payment yield for peanuts under section 158B.
(b) Payment Rate.--The payment rate used to make direct
payments with respect to peanuts for a fiscal year shall be
equal to $0.018 per pound.
(c) Payment Amount.--The amount of the direct payment to be
paid to the peanut producers on a farm for peanuts for a fiscal
year shall be equal to the product obtained by multiplying--
(1) the payment rate specified in subsection (b);
(2) the payment acres on the farm; by
(3) the payment yield for the farm.
(d) Time for Payment.--
(1) In general.--The Secretary shall make direct
payments--
(A) in the case of the 2002 fiscal year,
during the period beginning December 1, 2001,
and ending September 30, 2002; and
(B) in the case of each of the 2003 through
2006 fiscal years, not later than September 30
of the fiscal year.
(2) Advance payments.--
(A) In general.--At the option of the peanut
producers on a farm, the Secretary shall pay 50
percent of the direct payment for a fiscal year
for the producers on the farm on a date
selected by the peanut producers on the farm.
(B) Selected date.--The selected date for a
fiscal year shall be on or after December 1 of
the fiscal year.
(C) Subsequent fiscal years.--The peanut
producers on a farm may change the selected
date for a subsequent fiscal year by providing
advance notice to the Secretary.
(3) Repayment of advance payments.--If any peanut
producer on a farm that receives an advance direct
payment for a fiscal year ceases to be eligible for a
direct payment before the date the direct payment would
have been made by the Secretary under paragraph (1),
the peanut producer shall be responsible for repaying
the Secretary the full amount of the advance payment.
SEC. 158D. COUNTER-CYCLICAL PAYMENTS FOR PEANUTS.
(a) In General.--For each of the 2002 through 2006 crops of
peanuts, the Secretary shall make counter-cyclical payments
with respect to peanuts if the Secretary determines that the
effective price for peanuts is less than the income protection
price for peanuts.
(b) Effective Price.--For purposes of subsection (a), the
effective price for peanuts is equal to the total of--
(1) the greater of--
(A) the national average market price
received by peanut producers during the 12-
month marketing year for peanuts, as determined
by the Secretary; or
(B) the national average loan rate for a
marketing assistance loan for peanuts under
section 158G in effect for the 12-month
marketing year for peanuts under this chapter;
and
(2) the payment rate in effect for peanuts under
section 158C for the purpose of making direct payments
with respect to peanuts.
(c) Income Protection Price.--For purposes of subsection
(a), the income protection price for peanuts shall be equal to
$520 per ton.
(d) Payment Amount.--The amount of the counter-cyclical
payment to be paid to the peanut producers on a farm for a crop
year shall be equal to the product obtained by multiplying--
(1) the payment rate specified in subsection (e);
(2) the payment acres on the farm; by
(3) the payment yield for the farm.
(e) Payment Rate.--The payment rate used to make counter-
cyclical payments with respect to peanuts for a crop year shall
be equal to the difference between--
(1) the income protection price for peanuts; and
(2) the effective price determined under subsection
(b) for peanuts.
(f) Time for Payments.--
(1) In general.--The Secretary shall make counter-
cyclical payments to peanut producers on a farm under
this section for a crop of peanuts as soon as
practicable after determining under subsection (a) that
the payments are required for the crop year.
(2) Partial payment.--
(A) In general.--At the option of the
Secretary, the peanut producers on a farm may
elect to receive up to 40 percent of the
projected counter-cyclical payment to be made
under this section for a crop of peanuts on
completion of the first 6 months of the
marketing year for the crop, as determined by
the Secretary.
(B) Repayment.--The peanut producers on a
farm shall repay to the Secretary the amount,
if any, by which the payment received by
producers on the farm (including any partial
payments) exceeds the counter-cyclical payment
the producers on the farm are eligible for
under this section.
SEC. 158E. PRODUCER AGREEMENTS.
(a) Compliance With Certain Requirements.--
(1) Requirements.--Before the peanut producers on a
farm may receive direct payments or counter-cyclical
payments with respect to the farm, the peanut producers
on the farm shall agree during the fiscal year or crop
year, respectively, for which the payments are
received, in exchange for the payments--
(A) to comply with applicable highly erodible
land conservation requirements under subtitle B
of title XII of the Food Security Act of 1985
(16 U.S.C. 3811 et seq.);
(B) to comply with applicable wetland
conservation requirements under subtitle C of
title XII of that Act (16 U.S.C. 3821 et seq.);
(C) to comply with the planting flexibility
requirements of section 158F; and
(D) to use a quantity of the land on the farm
equal to the peanut acres, for an agricultural
or conserving use, and not for a
nonagricultural commercial or industrial use,
as determined by the Secretary.
(2) Compliance.--The Secretary may promulgate such
regulations as the Secretary considers necessary to
ensure peanut producer compliance with paragraph (1).
(b) Foreclosure.--
(1) In general.--The Secretary shall not require the
peanut producers on a farm to repay a direct payment or
counter-cyclical payment if a foreclosure has occurred
with respect to the farm and the Secretary determines
that forgiving the repayment is appropriate to provide
fair and equitable treatment.
(2) Compliance with requirements.--
(A) In general.--This subsection shall not
void the responsibilities of the peanut
producers on a farm under subsection (a) if the
peanut producers on the farm continue or resume
operation, or control, of the farm.
(B) Applicable requirements.--On the
resumption of operation or control over the
farm by the peanut producers on the farm, the
requirements of subsection (a) in effect on the
date of the foreclosure shall apply.
(c) Transfer or Change of Interest in Farm.--
(1) Termination.--Except as provided in paragraph
(5), a transfer of (or change in) the interest of the
peanut producers on a farm in peanut acres for which
direct payments or counter-cyclical payments are made
shall result in the termination of the payments with
respect to the peanut acres, unless the transferee or
owner of the acreage agrees to assume all obligations
under subsection (a).
(2) Effective date.--The termination takes effect on
the date of the transfer or change.
(3) Transfer of payment base and yield.--The
Secretary shall not impose any restriction on the
transfer of the peanut acres or payment yield of a farm
as part of a transfer or change described in paragraph
(1).
(4) Modification.--At the request of the transferee
or owner, the Secretary may modify the requirements of
subsection (a) if the modifications are consistent with
the purposes of subsection (a), as determined by the
Secretary.
(5) Exception.--If a peanut producer entitled to a
direct payment or counter-cyclical payment dies,
becomes incompetent, or is otherwise unable to receive
the payment, the Secretary shall make the payment, in
accordance with regulations promulgated by the
Secretary.
(d) Acreage Reports.--As a condition on the receipt of any
benefits under this chapter, the Secretary shall require the
peanut producers on a farm to submit to the Secretary acreage
reports for the farm.
(e) Tenants and Sharecroppers.--In carrying out this
chapter, the Secretary shall provide adequate safeguards to
protect the interests of tenants and sharecroppers.
(f) Sharing of Payments.--The Secretary shall provide for
the sharing of direct payments and counter-cyclical payments
among the peanut producers on a farm on a fair and equitable
basis.
SEC. 158F. PLANTING FLEXIBILITY.
(a) Permitted Crops.--Subject to subsection (b), any
commodity or crop may be planted on peanut acres on a farm.
(b) Limitations and Exceptions Regarding Certain
Commodities.--
(1) Limitations.--The planting of the following
agricultural commodities shall be prohibited on peanut
acres:
(A) Fruits.
(B) Vegetables (other than lentils, mung
beans, and dry peas).
(C) In the case of the 2003 and subsequent
crops of an agricultural commodity, wild rice.
(2) Exceptions.--Paragraph (1) shall not limit the
planting of an agricultural commodity specified in
paragraph (1)--
(A) in any region in which there is a history
of double-cropping of peanuts with agricultural
commodities specified in paragraph (1), as
determined by the Secretary, in which case the
double-cropping shall be permitted;
(B) on a farm that the Secretary determines
has a history of planting agricultural
commodities specified in paragraph (1) on
peanut acres, except that direct payments and
counter-cyclical payments shall be reduced by
an acre for each acre planted to the
agricultural commodity; or
(C) by the peanut producers on a farm that
the Secretary determines has an established
planting history of a specific agricultural
commodity specified in paragraph (1), except
that--
(i) the quantity planted may not
exceed the average annual planting
history of the agricultural commodity
by the peanut producers on the farm
during the 1996 through 2001 crop years
(excluding any crop year in which no
plantings were made), as determined by
the Secretary; and
(ii) direct payments and counter-
cyclical payments shall be reduced by
an acre for each acre planted to the
agricultural commodity.
SEC. 158G. MARKETING ASSISTANCE LOANS AND LOAN DEFICIENCY PAYMENTS FOR
PEANUTS.
(a) Nonrecourse Loans Available.--
(1) Availability.--For each of the 2002 through 2006
crops of peanuts, the Secretary shall make available to
peanut producers on a farm nonrecourse marketing
assistance loans for peanuts produced on the farm.
(2) Terms and conditions.--The loans shall be made
under terms and conditions that are prescribed by the
Secretary and at the loan rate established under
subsection (b).
(3) Eligible production.--The producers on a farm
shall be eligible for a marketing assistance loan under
this section forany quantity of a peanuts produced on
the farm.
(4) Treatment of certain commingled commodities.--In
carrying out this section, the Secretary shall make
loans to peanut producers on a farm that would be
eligible to obtain a marketing assistance loan but for
the fact the peanuts owned by the peanut producers on
the farm are commingled with other peanuts of other
producers in facilities unlicensed for the storage of
agricultural commodities by the Secretary or a State
licensing authority, if the peanut producers on a farm
obtaining the loan agree to immediately redeem the loan
collateral in accordance with section 158E.
(5) Options for obtaining loan.--A marketing
assistance loan under this subsection, and loan
deficiency payments under subsection (e), may be
obtained at the option of the peanut producers on a
farm through--
(A) a designated marketing association of
peanut producers that is approved by the
Secretary;
(B) the Farm Service Agency; or
(C) a loan servicing agent approved by the
Secretary.
(b) Loan Rate.--The loan rate for a marketing assistance
loan for peanuts under subsection (a) shall be equal to $400
per ton.
(c) Term of Loan.--
(1) In general.--A marketing assistance loan for
peanuts under subsection (a) shall have a term of 9
months beginning on the first day of the first month
after the month in which the loan is made.
(2) Extensions prohibited.--The Secretary may not
extend the term of a marketing assistance loan for
peanuts under subsection (a).
(d) Repayment Rate.--The Secretary shall permit peanut
producers on a farm to repay a marketing assistance loan for
peanuts under subsection (a) at a rate that is the lesser of--
(1) the loan rate established for peanuts under
subsection (b), plus interest (as determined by the
Secretary); or
(2) a rate that the Secretary determines will--
(A) minimize potential loan forfeitures;
(B) minimize the accumulation of stocks of
peanuts by the Federal Government;
(C) minimize the cost incurred by the Federal
Government in storing peanuts; and
(D) allow peanuts produced in the United
States to be marketed freely and competitively,
both domestically and internationally.
(e) Loan Deficiency Payments.--
(1) Availability.--The Secretary may make loan
deficiency payments available to the peanut producers
on a farm that, although eligible to obtain a marketing
assistance loan for peanuts under subsection (a), agree
to forgo obtaining the loan for the peanuts in return
for payments under this subsection.
(2) Amount.--A loan deficiency payment under this
subsection shall be obtained by multiplying--
(A) the loan payment rate determined under
paragraph (3) for peanuts; by
(B) the quantity of the peanuts produced by
the peanut producers on the farm, excluding any
quantity for which the producers on the farm
obtain a loan under subsection (a).
(3) Loan payment rate.--For purposes of this
subsection, the loan payment rate shall be the amount
by which--
(A) the loan rate established under
subsection (b); exceeds
(B) the rate at which a loan may be repaid
under subsection (d).
(4) Time for payment.--The Secretary shall make a
payment under this subsection to the peanut producers
on a farm with respect to a quantity of peanuts as of
the earlier of--
(A) the date on which the peanut producers on
the farm marketed or otherwise lost beneficial
interest in the peanuts, asdetermined by the
Secretary; or
(B) the date the peanut producers on the farm
request the payment.
(f) Compliance With Conservation Requirements.--As a
condition of the receipt of a marketing assistance loan under
subsection (a), the peanut producers on a farm shall comply
during the term of the loan with--
(1) applicable highly erodible land conservation
requirements under subtitle B of title XII of the Food
Security Act of 1985 (16 U.S.C. 3811 et seq.); and
(2) applicable wetland conservation requirements
under subtitle C of title XII of that Act (16 U.S.C.
3821 et seq.).
(g) Reimbursable Agreements and Payment of Expenses.--To
the maximum extent practicable, the Secretary shall implement
any reimbursable agreements or provide for the payment of
expenses under this chapter in a manner that is consistent with
the implementation of the agreements or payment of the expenses
for other commodities.
SEC. 158H. QUALITY IMPROVEMENT.
(a) Official Inspection.--
(1) Mandatory inspection.--All peanuts placed under a
marketing assistance loan under section 158G shall be
officially inspected and graded by a Federal or State
inspector.
(2) Optional inspection.--Peanuts not placed under a
marketing assistance loan may be graded at the option
of the peanut producers on a farm.
(b) Termination of Peanut Administrative Committee.--The
Peanut Administrative Committee established under Marketing
Agreement No. 1436, which regulates the quality of domestically
produced peanuts under the Agricultural Adjustment Act (7
U.S.C. 601 et seq.), reenacted with amendments by the
Agricultural Marketing Agreement Act of 1937, is terminated.
(c) Establishment of Peanut Standards Board.--
(1) In general.--The Secretary shall establish a
Peanut Standards Board for the purpose of assisting in
the establishment of quality standards with respect to
peanuts.
(2) Composition.--The Secretary shall appoint members
to the Board that, to the maximum extent practicable,
reflect all regions and segments of the peanut
industry.
(3) Duties.--The Board shall assist the Secretary in
establishing quality standards for peanuts.
(d) Crops.--This section shall apply beginning with the
2002 crop of peanuts.
* * * * * * *
Subtitle E--Administration
SEC. 161. ADMINISTRATION.
* * * * * * *
(d) Regulations.--Not later than 90 days after the date of
enactment of this title, the Secretary and the Commodity Credit
Corporation, as appropriate, shall issue such regulations as
are necessary to implement this title. The issuance of the
regulations 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 know as the ``Paperwork Reduction Act'').
(e) Adjustment Authority Related to Uruguay Round
Compliance.--If the Secretary determines that expenditures
under subtitles A through D that are subject to the total
allowable domestic support levels under the Uruguay Round
Agreements (as defined in section 2 of the Uruguay Round
Agreements Act (19 U.S.C. 3501)), as in effect on the date of
enactment of this subsection, will exceed the allowable levels
for any applicable reporting period, the Secretary may make
adjustments in the amount of the expenditures to ensure that
the expenditures do not exceed, but are not less than, the
allowable levels.
* * * * * * *
SEC. 163. COMMODITY CREDIT CORPORATION INTEREST RATE.
(a) In General.--Notwithstanding any other provision of
law, the monthly Commodity Credit Corporation interest rate
applicable to loans provided for agricultural commodities by
the Corporation shall be 100 basis points greater than the rate
determined under the applicable interest rate formula in effect
on October 1, 1995.
(b) Sugar.--For purposes of this section, raw cane sugar,
refined beet sugar, and in-process sugar eligible for a loan
under section 156 shall not be considered an agricultural
commodity.
* * * * * * *
SEC. 171. SUSPENSION AND REPEAL OF PERMANENT PRICE SUPPORT AUTHORITY.
(a) Agricultural Adjustment Act of 1938.--
(1) Suspensions.--The following provisions of the
Agricultural Adjustment Act of 1938 shall not be
applicable to the 1996 through [2002] 2006 crops of
loan commodities, peanuts, and sugar and shall not be
applicable to milk during the period beginning on the
date of enactment of this title and ending on December
31, 2002 2006:
(A) Parts II through V of subtitle B of title
III (7 U.S.C. 1326-1351).
(B) Subsections (a) through (j) of section
358 (7 U.S.C. 1358).
(C) Subsections (a) through (h) of section
358a (7 U.S.C. 1358a).
(D) Subsections (a), (b), (d), and (e) of
section 358d (7 U.S.C. 1359).
[(E) Part VII of subtitle B of title III (7
U.S.C. 1359aa-1359jj).]
[(F)] (E) In the case of peanuts, part I of
subtitle C of title III (7 U.S.C. 1361-1368).
[(G)] (F) In the case of upland cotton,
section 377 (7 U.S.C. 1377).
[(H)] (G) Subtitle D of title III (7 U.S.C.
1379a-1379j).
[(I)] (H) Title IV (7 U.S.C. 1401-1407).
(2) Reports and records.--
(b) Agricultural Act of 1949.--
(1) Suspensions.--The following provisions of the
Agricultural Act of 1949 shall not be applicable to the
1996 through [2002] 2006 crops of loan commodities,
peanuts, and sugar and shall not be applicable to milk
during the period beginning on the date of enactment of
this title and ending on December 31, [2002] 2006:
(A) Section 101 (7 U.S.C. 1441).
(B) Section 103(a) (7 U.S.C. 1444(a)).
(C) Section 105 (7 U.S.C. 1444b).
(D) Section 107 (7 U.S.C. 1445a).
(E) Section 110 (7 U.S.C. 1445e).
(F) Section 112 (7 U.S.C. 1445g).
(G) Section 115 (7 U.S.C. 1445k).
(H) Section 201 (7 U.S.C. 1446).
(I) Title III (7 U.S.C. 1447-1449).
(J) Title IV (7 U.S.C. 1421-1433d), other
than sections 404, 412, and 416 (7 U.S.C. 1424,
1429, and 1431).
(K) Title V (7 U.S.C. 1461-1469).
(L) Title VI (7 U.S.C. 1471-1471j).
(2) Repeals.--The following provisions of the
Agricultural Act of 1949 are repealed:
(A) Section 101B (7 U.S.C. 1441-2).
(B) Section 103B (7 U.S.C. 1444-2).
(C) Section 105B (7 U.S.C. 1444f).
(D) Section 107B (7 U.S.C. 1445-3a).
(E) Section 108B (7 U.S.C. 1445c-3).
(F) Section 113 (7 U.S.C. 1445h).
(G) Subsections (b) and (c) of section 114 (7
U.S.C. 1445j).
(H) Sections 205, 206, and 207 (7 U.S.C.
1446f, 1446g, and 1446h).
(I) Sections 406 and 427 (7 U.S.C. 1426 and
1433f).
(3) Potential price support for rice.--
(c) Suspension of Certain Quota Provisions.--The joint
resolution entitled ``A joint resolution relating to corn and
wheat marketing quotas under the Agricultural Adjustment Act of
1938, as amended'', approved May 26, 1941 (7 U.S.C. 1330 and
1340), shall not be applicable to the crops of wheat planted
for harvest in the calendar years 1996 through [2002] 2006.
* * * * * * *
SEC. 188. TERMINATION OF COMMISSION.
The Commission shall terminate on submission of the final
report required by section 184.
Subtitle H--Miscellaneous Commodity Provisions
[SEC. 191. OPTIONS PILOT PROGRAM.
[(a) Pilot Programs Authorized.--Until December 31, 2002,
the Secretary of Agriculture may conduct a pilot program for 1
or more agricultural commodities supported under this title to
ascertain whether futures and options contracts can provide
producers with reasonable protection from the financial risks
of fluctuations in price, yield, and income inherent in
theproduction and marketing of the commodities. The pilot program shall
be an alternative to other related programs of the Department of
Agriculture.
[(b) Distribution of Pilot Program.--For each agricultural
commodity included in the pilot program, the Secretary may
operate the pilot program in not more than 300 counties, except
that not more than 25 of the counties may be located in any 1
State. The pilot program for a commodity shall not be operated
in any county for more than 3 of the 1996 through 2002 calendar
years.
[(c) Eligible Participants.--In operating the pilot
program, the Secretary may enter into contract with a producer
who--
[(1) is eligible for a production flexibility
contract, a marketing assistance loan, or other
assistance under this title;
[(2) volunteers to participate in the pilot program
during any calendar year in which a county in which the
farm of the producer is located is included in the
pilot program;
[(3) operates a farm located in a county selected for
the pilot program; and
[(4) meets such other eligibility requirements as the
Secretary may establish.
[(d) Notice to Producers.--The Secretary shall provide
notice to each producer participating in the pilot program
that--
[(1) the participation of the producer is voluntary;
and
[(2) neither the United States, the Commodity Credit
Corporation, the Federal Crop Insurance Corporation,
the Department of Agriculture, nor any other Federal
agency is authorized to guarantee that participants in
the pilot program will be better or worse off
financially as a result of participation in the pilot
program than the producer would have been if the
producer had not participated in the pilot program.
[(e) Contracts.--The Secretary shall set forth in each
contract under the pilot program the terms and conditions for
participation in the pilot program and the notice required by
subsection (d).
[(f) Eligible Markets.--Trades for futures and options
contracts under the pilot program shall be carried out on
commodity futures and options markets designated as contract
markets under the Commodity Exchange Act (7 U.S.C. 1 et seq.).
[(g) Recordkeeping.--A producer participating in the pilot
program shall compile, maintain, and submit (or authorize the
compilation, maintenance, and submission) of such documentation
as the regulations governing the pilot program require.
[(h) Use of Commodity Credit Corporation.--The Secretary
shall fund and operate the pilot program through the Commodity
Credit Corporation, except that the amount of Commodity Credit
Corporation funds used to carry out this section shall not
exceed, to the maximum extent practicable, $9,000,000 for
fiscal year 2001, $15,000,000 for fiscal year 2002, and
$2,000,000 for fiscal year 2003. To the maximum extent
practicable, the Secretary shall operate the pilot program in a
budget neutral manner.
[(i) Conforming Repeal.--]
SEC. 191. COMMODITY PURCHASES.
(a) In General.--To purchase agricultural commodities under
this section, the Secretary shall use funds of the Commodity
Credit Corporation in an amount equal to--
(1) for each of fiscal years 2002 and 2003,
$130,000,000, of which not less than $100,000,000 shall
be used for the purchase of specialty crops;
(2) for fiscal year 2004, $150,000,000, of which not
less than $120,000,000 shall be used for the purchase
of specialty crops;
(3) for fiscal year 2005, $170,000,000, of which not
less than $140,000,000 shall be used for the purchase
of specialty crops;
(4) for fiscal year 2006, $200,000,000, of which not
lessthan $170,000,000 shall be used for the purchase of
specialty crops;
(5) for fiscal year 2007, $0.
(b) Other Purchases.--The Secretary shall ensure that
purchases of agricultural commodities under this section are in
addition to purchases by the Secretary under any other law.
(c) Purchases by Department of Defense for School Lunch
Program.--The Secretary shall provide not less than $50,000,000
for each fiscal year of the funds made available under
subsection (a) to the Secretary of Defense to purchase fresh
fruits and vegetables for distribution to schools and service
institutions in accordance with section 6(a) of the Richard B.
Russell National School Lunch Act (42 U.S.C. 1755(a)) in a
manner prescribed by the Secretary of Agriculture.
(d) Purchases for Emergency Food Assistance Program.--The
Secretary shall use not less than $40,000,000 for each fiscal
year of the funds made available under subsection (a) to
purchase agricultural commodities for distribution under the
Emergency Food Assistance Act of 1983 (7 U.S.C. 7501 et seq.).
* * * * * * *
[SEC. 193. CROP INSURANCE.
[(a) Catastrophic Risk Protection.--
[(1) Single delivery.--
[(2) Waiver of mandatory linkage.--
[(3) Special rule for 1996.--
[(A) Effective period.--This paragraph shall
apply only to the 1996 crop year.
[(B) Availability.--During a period of not
less than 2 weeks, but not more than 4 weeks,
beginning on the date of enactment of this
title, the Secretary shall provide producers
with an opportunity to obtain catastrophic risk
protection insurance under section 508(b) of
the Federal Crop Insurance Act (7 U.S.C.
1508(b)) for a spring-planted crop, and limited
additional coverage for malting barley under
the Malting Barley Price and Quality
Endorsement. The Federal Crop Insurance
Corporation may attach such limitations and
restrictions on obtaining insurance during this
period as the Corporation considers necessary
to maintain the actuarial soundness of the crop
insurance program.
[(C) Attachment.--Insurance coverage under
any policy obtained under this paragraph during
the extended sales period shall not attach
until 10 days after the application.
[(D) Cancellation.--During the extended
period, a producer may cancel a catastrophic
risk protection policy if--
[(i) the policy is a continuation of
a policy that was obtained for a
previous crop year; and
[(ii) the cancellation request is
made before the acreage reporting date
for the policy for the 1996 crop year.
[(b) Crop Insurance Pilot Project.--
[(1) Coverage.--The Secretary of Agriculture shall
develop and administer a pilot project for crop
insurance coverage that indemnifies crop losses due to
a natural disaster such as insect infestation or
disease.
[(2) Actuarial soundness.--A pilot project under this
paragraph shall be actuarially sound, as determined by
the Secretary and administered at no net cost.
[(3) Duration.--A pilot project under this paragraph
shall be of two years' duration.
[(c) Crop Insurance for Nursery Crops.--
[(d) Marketing Windows.--
[(e) Funding.--
[(f) Limitation on Multiple Benefits for Same Loss.--]
SEC. 193. HARD WHITE WHEAT INCENTIVE PAYMENTS.
(a) In General.--For the period of crop years 2003 through
2005, the Secretary shall use $40,000,000 of funds of the
Commodity Credit Corporation to provide incentive payments to
producers of hard white wheat to ensure that hard white wheat,
produced on a total of not more than 2,000,000 acres, meets
minimum quality standards established by the Secretary.
(b) Application.--The amounts payable to producers in the
form of payments under this section shall be determined through
the submission of bids by producers in such manner as the
Secretary may prescribe.
(c) Demand for Wheat.--To be eligible to obtain a payment
under this section, a producer shall demonstrate to the
Secretary the availability of buyers and end-users for the
wheat that is the covered by the payment.
* * * * * * *
AGRICULTURAL ADJUSTMENT ACT OF 1938
[[Part VII was made inapplicable to the 1996 through 2002
crops of sugar.]
[PART VII--MARKETING QUOTAS--SUGAR AND CRYSTALLINE FRUCTOSE]
PART VII--FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR
SEC. 359. DEFINITIONS.
In this part:
(1) Mainland state.--The term ``mainland State''
means a State other than an offshore State.
(2) Offshore state.--The term ``offshore State''
means a sugarcane producing State located outside of
the continental United States.
(3) State.--Notwithstanding section 301, the term
``State'' means--
(A) a State;
(B) the District of Columbia; and
(C) the Commonwealth of Puerto Rico.
(4) United States.--The term ``United States'', when
used in a geographical sense, means all of the States.
[Part VII was made inapplicable to the 1996 through 2002 crops
of sugar by sec. 171(a)(1)(E) of the Agricultural Market
Transition Act, P.L. 104-127, 110 Stat. 937, April 4, 1996.
[SEC. 359A. INFORMATION REPORTING.
[(a) Duty of Processors, Refiners and Manufacturers To
Report.--
[(1) Processors and refiners.--All sugarcane
processors, cane sugar refiners, and sugar beet
processors shall furnish the Secretary, on a monthly
basis, such information as the Secretary may require to
administer sugar programs, including the quantity of
purchases of sugarcane, sugar beets, and sugar, and
production, importation, distribution, and stock levels
of sugar.
[(2) Manufacturers of crystalline fructose.--All
manufacturers of crystalline fructose from corn
(hereafter in this part referred to as ``crystalline
fructose'') shall furnish the Secretary, on a monthly
basis, such information as the Secretary may require
with respect to the manufacturer's distribution of
crystalline fructose.
[(b) Duty of Producers To Report.--The Secretary may
require a producer of sugarcane or sugar beets to report, in
the manner prescribed by the Secretary, the producer's
sugarcane or sugar beet yields and acres planted to sugarcane
or sugar beets, respectively.
[(c) Penalty.--Any person willfully failing or refusing to
furnish the information, or furnishing willfully any false
information, shall be subject to a civil penalty of not more
than $10,000 for each such violation.
[(d) Monthly Reports.--Taking into consideration the
information received under subsection (a), the Secretary shall
publish on a monthly basis composite data on production,
imports, distribution, and stock levels of sugar and composite
data on distributions of crystalline fructose.]
SEC. 359B. FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR [AND CRYSTALLINE
FRUCTOSE].
(a) Sugar Estimates.--
(1) In general.--[Before] Not later than August 1
before the beginning of each of the fiscal years [1992
through 1998] 2002 through 2006, the Secretary shall
estimate--
(2) Exclusion.--The estimates under this subsection
shall not apply to sugar imported for the production of
polyhydric alcohol or to any sugar refined and
reexported in refined form or in products containing
sugar.
(A) the quantity of sugar that will be
consumed in the United States during the fiscal
year [(other than sugar imported for the
production of polyhydric alcohol or to be
refined and reexported in refined form or in
sugar containing products) and the quantity of
sugar that would provide for reasonable
carryover stocks];
(B) the quantity of sugar that would provide
for reasonable carryover stocks;
[(B)] (C) the quantity of sugar that will be
available from carry-in stocks [or from
domestically-produced sugarcane and sugar
beets] for consumption in the United States
during the year; [and]
(D) the quantity of sugar that will be
available from the domestic processing of
sugarcane and sugar beets; and
[(C)] (E) the [quantity of sugar] quantity of
sugars, syrups, and molasses that will be
imported for human consumption or to be used
for the extraction of sugar for human
consumption in the United States during the
[year] year, whether such articles are under a
tarriff-rate quota or are in excess or outside
of a tarriff rate quota. [(other than sugar
imported for the production of polyhydric
alcohol or to be refined and reexported in a
refined form or in sugar containing products),
based on the difference between--
[(i) the sum of the quantity of
estimated consumption and reasonable
carryover stocks; and
[(ii) the quantity of sugar estimated
to be available from domestically-
produced sugarcane and sugar beets and
from carry-in stocks.
[(2)] (3) [Quarterly reestimates] Reestimates.--The
Secretary shall make quarterly reestimates of sugar
consumption, stocks, production, and imports for a
fiscal year as necessary, but no later than the
beginning of each of the second through fourth quarters
of the fiscal year.
(b) Sugar Allotments.--
[(1) In general.--For any fiscal year in which the
Secretary estimates, under subsection (a)(1)(C), that
imports of sugar for consumption in the United States
(other than sugar imported for the production of
polyhydric alcohol or to be refined and reexported in
refined form or in sugar containing products) will be
less than 1,250,000 short tons, raw value, the
Secretary shall establish for that year appropriate
allotments under section 359c for the marketing by
processors of sugar processed from domestically-
produced sugarcane and sugar beets, at a level that the
Secretary estimates will result in imports of sugar of
not less than 1,250,000 short tons, raw value, for that
year.]
(1) In general.--By the beginning of each fiscal
year, the Secretary shall establish for that fiscal
year appropriate allotments under section 359c for the
marketing by processors of sugar processed from sugar
beets and from domestically-produced sugarcane at a
level that the Secretary estimates will result in no
forfeitures of sugar to the Commodity Credit
Corporation under the loan program for sugar
established under section 156 of the Federal
Agriculture Improvement and Reform Act of 1996 (7
U.S.C. 7251).''; and
(2) Products.--The Secretary may include sugar
products, whose majority content is sucrose [or
crystalline fructose] for human consumption, derived
from sugarcane, sugar beets, molasses or sugar in the
allotments under paragraph (1) if the Secretary
determines it to be appropriate for purposes of this
part.
[(c) Crystalline Fructose Allotments.--For any fiscal year
in which the Secretary establishes allotments for the marketing
of sugar under section 359c, the Secretary shall establish for
that year appropriate allotments for the marketing by
manufacturers of crystalline fructose manufactured from corn,
at a total level not to exceed the equivalent of 200,000 tons
of sugar, raw value, during the fiscal year, in a manner that
is fair, efficient, and equitable to manufacturers.]
[(d)] (c) Prohibitions.--
(1) In general.--During any fiscal year or portion
thereof for which marketing allotments have been
established, no processor of sugar beets or sugarcane
shall market a quantity ofsugar in excess of the
allocation established for such processor, except to enable another
processor to fulfill an allocation established for such other processor
or to facilitate the exportation of such sugar.
[(2) Crystalline fructose.--At any time crystalline
fructose allotments are in effect for manufacturers
under subsection (c), no manufacturer may market
crystalline fructose in excess of the manufacturer's
allotment. No restrictions or allotments shall be
established on the marketings of any liquid fructose
produced from corn.]
[(3)] (2) Civil penalty.--Any processor who knowingly
violates paragraph (1) [or manufacturer who knowingly
violates paragraph (2)] shall be liable to the
Commodity Credit Corporation for a civil penalty in an
amount equal to 3 times the United States market value,
at the time of the commission of the violation, of that
quantity of sugar [or crystalline fructose] involved in
the violation.
[(4)] (3) Definition of market.--For purposes of this
part, the term ``market'' shall mean to sell or
otherwise dispose of in commerce in the United States
(including, with respect to any integrated processor
and refiner, the movement of raw cane sugar into the
refining process).
* * * * * * *
SEC. 359C. ESTABLISHMENT OF FLEXIBLE MARKETING ALLOTMENTS.
(a) In General.--The Secretary shall establish flexible
marketing allotments for sugar for any fiscal year in which the
allotments are required under section 359b(b) in accordance
with this section.
(b) Overall Allotment Quantity.--
(1) In general.--The Secretary shall establish the
overall quantity of sugar to be allotted for the fiscal
year (hereafter in this part referred to as the
``overall allotment quantity'') by deducting from the
sum of the estimated sugar consumption and reasonable
carryover stocks (at the end of the fiscal year) for
the fiscal year, as determined under section 359b(a)--
(A) [1,250,000] 1,532,000 short tons, raw
value; and
(B) carry-in stocks of sugar, including sugar
in Commodity Credit Corporation inventory.
(2) Adjustment.--The Secretary shall adjust the
overall allotment quantity [to the maximum extent
practicable] to avoid the forfeiture of sugar to the
Commodity Credit Corporation.
[(c) Allotment.--The overall allotment quantity for the
fiscal year shall be allotted among--
[(1) sugar derived from sugar beets; and
[(2) sugar derived from sugarcane.]
(c) Marketing Allotment for Sugar Derived From Sugar Beets
and Sugar Derived From Sugarcane.--The overall allotment
quantity for the fiscal year shall be allotted between--
(1) sugar derived from sugar beets by establishing a
marketing allotment for a fiscal year at a quantity
equal to the product of multiplying the overall
allotment quantity for the fiscal year by 54.35
percent; and
(2) sugar derived from sugarcane by establishing a
marketing allotment for a fiscal year at a quantity
equal to the product of multiplying the overall
allotment quantity for the fiscal year by 45.65
percent.'';
[(d) Percentage Factors.--
[(1) In general.--The Secretary shall establish
percentage factors for the overall beet sugar and cane
sugar allotments applicable for a fiscal year. The
Secretary shall establish the percentage factors in a
fair and equitable manner on the basis of past
marketings of sugar (considering for such purposes
themarketings of sugar processed from sugarcane and sugar beets of any
or all of the 1985 through 1989 crops), processing and refining
capacity, and the ability of processors to market the sugar covered
under the allotments.
[(2) Publication.--The Secretary shall publish these
percentage factors in the Federal Register, along with
a description of the Secretary's reasons for
establishing the factors, as provided in section
359h(c).]
(d) Filling Cane Sugar and Beet Sugar Allotments.--
(1) Cane sugar.--Each marketing allotment for cane
sugar established under this section may only be filled
with sugar processed from domestically grown sugarcane.
(2) Beet sugar.--Each marketing allotment for beet
sugar established under this section may only be filled
with sugar domestically processed from sugar beets.
[(e) Marketing Allotment.--The marketing allotment for
sugar derived from sugarcane and the marketing allotment for
sugar derived from sugar beets for a fiscal year, in each case,
shall be a quantity equal to the product of multiplying the
overall allotment quantity for the fiscal year by the
percentage factor established by the Secretary under subsection
(d)(1) for the allotment.]
[(f)] (e) State Cane Sugar Allotments.--[The allotment]
(1) In general.--The allotment for sugar derived from
sugarcane shall be further allotted, among [the 5] the
States in the United States in which sugarcane is
produced, after a hearing (if requested by the affected
sugarcane processors and growers) and on such notice as
the Secretary by regulation may prescribe, in a fair
and equitable manner [on the basis of past marketings
of sugar (considering for such purposes the average of
marketings of sugar processed from sugarcane in the 2
highest years of production from each State from the
1985 through 1989 crops), processing capacity, and the
ability of processors to market the sugar covered under
the allotments.] as provided in this subsection and
section 359d (a)(2)(A)(iv).
(f) Filling Cane Sugar Allotments.--Except as provided in
section 359e, a State cane sugar allotment established under
subsection (e) for a fiscal year may be filled only with sugar
processed from sugarcane grown in the State covered by the
allotment.
(2) Offshore allotment.--
(A) Collectively.--Prior to the allotment of
sugar derived from sugarcane to any other
State, 325,000 short tons, raw value shall be
allotted to the offshore States.
(B) Individually.--The collective offshore
State allotment provided for under subparagraph
(A) shall be further allotted among the
offshore States in which sugarcane is produced,
after a hearing (if requested by the affected
sugarcane processors and growers) and on such
notice as the Secretary by regulation may
prescribe, in a fair and equitable manner on
the basis of--
(i) past marketings of sugar, based
on the average of the 2 highest years
of production of raw cane sugar from
the 1996 through 2000 crops;
(ii) the ability of processors to
market the sugar covered under the
allotments for the crop year; and
(iii) past processings of sugar from
sugarcane based on the 3-year average
of the 1998 through 2000 crop years.
(3) Mainland allotment.--The allotment for sugar
derived from sugarcane, less the amount provided for
under paragraph (2), shall be allotted among the
mainland States in the United States in which sugarcane
is produced, after a hearing (if requested by the
affected sugarcane processors and growers) and on such
notice as the Secretary by regulation may prescribe, in
a fair and equitable manner on the basis of--
(A) past marketings of sugar, based on the
average of the 2 highest years of production of
raw cane sugar from the 1996 through 2000
crops;
(B) the ability of processors to market the
sugar covered under the allotments for the crop
year; and
(C) past processings of sugar from sugarcane,
based on the 3 crop years with the greatest
processings (in the mainland States
collectively) during the 1991 through 2000 crop
years.
(g) Adjustment of Marketing Allotments.--
(1) In general.--The Secretary shall, based on
reestimates under section [359b(a)(2)--
[(A) adjust upward or downward marketing
allotments established under subsections (a)
through (f) in a fair and equitable manner;
[(B) establish marketing allotments for the
fiscal year or any portion of such fiscal year;
or
[(C) suspend the allotments,]
359b(a)(3), adjust upward or downward marketing
allotments in a fair and equitable manner as the
Secretary determines appropriate, to reflect changes in
estimated sugar consumption, stocks, production, or
imports.
(2) Allocation to processors.--In the case of any
increase or decrease in an allotment, each allocation
to a processor of the allotment under section 359d, and
each proportionate share established with respect to
the allotment under section [359f(b)] 359f(c), shall be
increased or decreased by the same percentage that the
allotment is increased or decreased.
(3) [Reductions] Carry-over of reductions.--Whenever
a marketing allotment for a fiscal year is required to
be reduced during the fiscal year under this
subsection, if at the time of the reduction the
quantity of sugar marketed, including sugar pledged as
collateral for a [price support] nonrecourse loan under
section [206 of the Agricultural Act of 1949 (7 U.S.C.
1446g), for the fiscal year at the time of the
reduction by any individual processor covered by the
allotment] 156 of the Federal Agriculture Improvement
and Reform Act of 1996 (7 U.S.C. 7251), exceeds the
processor's reduced allocation, the allocation of an
allotment[, if any,] next established for the processor
shall be reduced by the quantity of the excess sugar
marketed.
[(h) Filling Cane Sugar and Beet Sugar Allotments.--Each
marketing allotment for cane sugar established under this
section may only be filled with sugar processed from
domestically grown sugarcane, and each marketing allotment for
beet sugar established under this section may only be filled
with sugar processed from domestically grown sugar beets.
(h) Suspension of Allotments.--Whenever the Secretary
estimates or reestimates under section 359b(a), or has reason
to believe, that imports of sugars, syrups or molasses for
human consumption or to be used for the extraction of sugar for
human consumption, whether under a tariff-rate quota or in
excess or outside of a tariff-rate quota, will exceed 1,532,000
short tons (raw value equivalent), and that the imports would
lead to a reduction of the overall allotment quantity, the
Secretary shall suspend the marketing allotments established
under this section until such time as the imports have been
restricted, eliminated, or reduced to or below the level of
1,532,000 short tons (raw value equivalent).
* * * * * * *
SEC. 359D. ALLOCATION OF MARKETING
* * * * * * *
(1) Allocation to processors.--Whenever marketing
allotments are established for a fiscal year under
section 359c, in order to afford all interested persons
an equitable opportunity to market sugar under an
allotment, the Secretary shall allocate each such
allotment among the processors covered by the
allotment.
(2) Hearing and notice.--
(A) Cane sugar.--[The Secretary] (i) In
general.--The Secretary shall make allocations
for cane sugar after a hearing, if requested by
[interested parties] the affected sugar cane
processors and growers and on such notice as
the Secretary by regulation may prescribe, in
such manner and in such quantities as to
provide a fair, efficient, and equitable
distribution of the allocations [by taking into
consideration processing capacity, past
marketings of sugar, and the ability of each
processor to market sugar covered by that
portion of the allotment allocated.] under this
subparagraph. Each such allocation shall be
subject to adjustment under section 359c(g).
(ii) Multiple processor states.--Except as
provided in clauses (iii) and (iv), the
Secretary shall allocate the allotment for cane
sugar among multiple cane sugar processors in a
single Statebased on--
(I) past marketings of sugar, based
on the average of the 2 highest years
of production of raw cane sugar from
among the 1996 through 2000 crops;
(II) the ability of processors to
market sugar covered by that portion of
the allotment allocated for the crop
year; and
(III) past processings of sugar from
sugarcane, based on the average of the
3 highest years of production during
the 1996 through 2000 crop years.
(iii) Talisman processing facility.--In the
case of allotments under clause (ii)
attributable to the operations of the Talisman
processing facility before the date of
enactment of this clause, the Secretary shall
allocate the allotment among processors in the
State under clause (i) in accordance with the
agreements of March 25 and 26, 1999, between
the affected processors and the Secretary of
the Interior.
(iv) Proportionate share states.--In the case
of States subject to section 359f(c), the
Secretary shall allocate the allotment for cane
sugar among multiple cane sugar processors in a
single state based on--
(I) past marketings of sugar, based
on the average of the 2 highest years
of production of raw cane sugar from
among the 1997 through 2001 crop years;
(II) the ability of processors to
market sugar covered by that portion of
the allotments allocated for the crop
year; and
(III) past processings of sugar from
sugarcane, based on the average of the
2 highest crop years of crop production
during the 1997 through 2001 crop
years.
(v) New entrants.--
(I) In general.--Notwithstanding
clauses (ii) and (iv), the Secretary,
on application of any processor that
begins processing sugarcane on or after
the date of enactment of this clause,
and after a hearing (if requested by
the affected sugarcane processors and
growers) and on such notice as the
Secretary by regulation may prescribe,
may provide the processor with an
allocation that provides a fair,
efficient and equitable distribution of
the allocations from the allotment for
the State in which the processor is
located.
(II) Proportionate share states.--In
the case of proportionate share States,
the Secretary shall establish
proportionate shares in a quantity
sufficient to produce the sugarcane
required to satisfy the allocations.
(III) Limitation.--The allotment for
a new processor under this clause shall
not exceed 50,000 short tons (raw
value).
(vi) Transfer of ownership.--Except as
otherwise provided in section 359f(c)(8), if a
sugarcane processor is sold or otherwise
transferred to another owner, or closed as part
of an affiliated corporate group processing
consolidation, the Secretary shall transfer the
allotment allocation for the processor to the
purchaser, new owner, or successor in interest,
as applicable, of the processor.
(B) Beet sugar.--[The Secretary]
(i) In general.--The Secretary shall
make allocations for beet sugar after a
hearing, if requested by [interested
parties] the affected sugar beet
processors and growers and on such
notice as the Secretary by regulation
may prescribe, in such manner and in
such quantities as to provide a fair,
efficient, and equitable distribution
of the allocations by taking into
consideration [processing capacity,
past marketings of sugar (considering
for the purposes the marketings of
sugar processed from sugar beets of any
or all of the 1985 through 1989 crops),
and the ability of each processor to
market sugar covered by that portion of
the allotment allocated] the marketings
of sugar processed from sugar beets of
any or all of the 1996 through 2000
crops, and such other factors as the
Secretary may consider appropriate
after consultation with the affected
sugar beet processors and growers. Each
such allocation shall be subject to
adjustment under section 359c(g).
(b) Filling Cane Sugar Allotments.--Except as otherwise
provided in section 359e, a State cane sugar allotment
established under section 359c(f) for a fiscal year may be
filledonly with sugar processed from sugarcane grown in the
State covered by the allotment.
(ii) New processors.--In the case of
any processor that has started
processing sugar beets after January 1,
1996, the Secretary shall provide the
processor with an allocation that
provides a fair, efficient and
equitable distribution of the
allocations.
* * * * * * *
(B) if after the reassignments the deficit
cannot be completely eliminated, the Secretary
shall reassign the estimated quantity of the
deficit proportionately to the allotments for
other cane sugar States, depending on the
capacity of each other State to fill the
portion of the deficit to be assigned to it,
with the reassigned quantity to each State to
be allocated among processors in that State in
proportion to the allocations of the
processors; [and]
(C) if after the reassignments, the deficit
cannot be completely eliminated, the Secretary
shall reassign the estimated quantity of the
deficit to the sale of any inventories of sugar
held by the Commodity Credit Corporation; and
[(C)] (D) if after the reassignments and
sales, the deficit cannot be completely
eliminated, the Secretary shall reassign the
remainder to imports.
(2) Beet sugar.--If the Secretary determines that a
sugar beet processor who has been allocated a share of
the beet sugar allotment will be unable to market that
allocation--
(A) the Secretary first shall reassign the
estimated quantity of the deficit to the
allotments for other sugar beet processors,
depending on the capacity of each other
processor to fill the portion of the deficit to
be assigned to it and taking into account the
interests of producers served by the
processors; [and]
(B) if after the reassignments, the deficit
cannot be completely eliminated, the Secretary
shall [reassign the remainder to imports.] use
the estimated quantity of the deficit for the
sale of any inventories of sugar held by the
Commodity Credit Corporation; and
(C) if after the reassignments and sales, the
deficit cannot be completely eliminated, the
Secretary shall reassign the remainder to
imports.
* * * * * * *
(3) Corresponding increase.--The allocation of each
processor receiving a reassigned quantity of an
allotment under this subsection for a fiscal year shall
be increased to reflect the reassignment.
SEC. 359F. PROVISIONS APPLICABLE TO PRODUCERS.
(a) Processor Assurances.--[Whenever]
(1) In general.--If allotments for a fiscal year are
allocated to processors under section 359d, the
Secretary shall obtain from the processors such
assurances as the Secretary considers adequate that the
allocation will be shared among producers served by the
processor in a fair and equitable manner that
adequately reflects producers' production histories.
[Any dispute]
(2) Arbitration._
(A) In general.--Any dispute between a
processor and a producer, or group of
producers, with respect to the sharing of the
[processor's allocation] allocation to the
processor shall be resolved through arbitration
by the Secretary on the request of either
party.
(B) Period.--The arbitration shall, to the
maximum extent practicable, be (i) commenced
not more than 45 days after the request; and
(ii) shall be completed not more than 60 days
after the request.
* * * * * * *
(b) Sugar Beet Processing Facility Closures.--
(1) In general.--If a sugar beet processing facility
is closed and the sugar beet growers that previously
delivered beets to the facility elect to deliver their
beets to another processing company, the growers may
petition the Secretary to modify allocations under this
part to allow the delivery.
(2) Increased allocation for processing company.--The
Secretary may increase the allocation to the processing
company to which the growers elect to deliver their
sugar beets, with the approval of the processing
company, to a level that does not exceed the processing
capacity of the processing company, to accommodate the
change in deliveries.
(3) Decreased allocation for closed company.--The
increased allocation shall be deducted from the
allocation to the company that owned the processing
facility that has been closed and the remaining
allocation shall be unaffected.
(4) Timing.--The determinations of the Secretary on
the issuesraised by the petition shall be made within
60 days after the filing of the petition.
[(b)] (c) Proportionate Shares of Certain Allotments.--
* * * * * * *
(3) Method of determining.--For purposes of
determining proportionate shares for any crop of
sugarcane:
(A) The Secretary shall establish the State's
per-acre yield goal for a crop of sugarcane at
a level (not less than the average per-acre
yield in the State for [the preceding 5 years]
the two highest of the 1999, 2000, and 2001
crop years, as determined by the Secretary)
that will ensure an adequate net return per
pound to producers in the State, taking into
consideration any available production research
data that the Secretary considers relevant.
* * * * * * *
(7) Adjustments.--Whenever the Secretary determines
that, because of a natural disaster or other condition
beyond the control of producers that adversely affects
a crop of sugarcane subject to proportionate shares,
the amount of sugarcane produced by producers subject
to the proportionate shares will not be sufficient to
enable processors in the State to meet the State's cane
sugar allotment and provide a normal carryover
inventory of sugar, the Secretary may uniformly allow
producers to harvest an amount of sugarcane in excess
of their proportionate share, or suspend proportionate
shares entirely, as necessary to enable processors to
meet the State allotment and provide a normal carryover
inventory of sugar.
(8) Processing facility closures.--
(A) In general.--If a sugarcane processing
facility subject to this subsection is closed
and the sugarcane growers that delivered
sugarcane to the facility prior to closure
elect to deliver their sugarcane to another
processing company, the growers may petition
the Secretary to modify allocations under this
part to allow the delivery.
(B) Increased allocation for processing
company.--The Secretary may increase the
allocation to the processing company to which
the growers desire to deliver the sugarcane,
with the approval of the processing company, to
a level that does not exceed the processing
capacity of the processing company, to
accommodate the change in deliveries;
(C) Decreased allocation for closed
company.--The increased allocation shall be
deducted from the allocation to the company
that owned the processing facility that has
been closed and the remaining allocation will
be unaffected.
(D) Timing.--The determinations of the
Secretary on the issues raised by the petition
shall be made within 60 days after the filing
of the petition.
* * * * * * *
SEC. 359G. SPECIAL RULES.
(a) Transfer of Acreage Base History.--For the purpose of
establishing proportionate shares for sugarcane farms under
section [359f] 359f(c), the Secretary, on application of any
producer, with the written consent of all owners of a farm, may
transfer the acreage base history of the farm to any other
parcels of land of the applicant.
(b) Preservation of Acreage Base History.--If for reasons
beyond the control of a producer on a farm, the producer is
unable to harvest an acreage of sugarcane for sugar or seed
with respect to all or a portion of the proportionate share
established for the farm under section [359f] 359f(c), the
Secretary, on the application of the producer and with the
written consent of all owners of the farm, may preserve for a
period of not more than [3 consecutive years] 5 consecutive
years the acreage base history of the farm to the extent of the
proportionate share involved. The Secretary may permit the
proportionate share to be redistributed to other farms, but no
acreage base history for purposes of establishing acreage bases
shall accrue to the other farms by virtue of the redistribution
of the proportionate share.
(c) Revisions of Allocations and Proportionate Shares.--The
Secretary, after such notice as the Secretary by regulation may
prescribe, may revise or amend any allocation of a marketing
allotment under section 359d, or any proportionateshare
established or adjusted for a farm under section [359f] 359f(c), on the
same basis as the initial allocation or proportionate share was
required to be established.
* * * * * * *
SEC. 359J. ADMINISTRATION.
(a) Use of Certain Agencies.--In carrying out this part,
the Secretary may use the services of local committees of sugar
beet or sugarcane producers, sugarcane processors, or sugar
beet processors, State and county committees established under
section 8(b) of the Soil Conservation and Domestic Allotment
Act (16 U.S.C. 590h(b)), and the departments and agencies of
the United States Government.
(b) Use of Commodity Credit Corporation.--The Secretary
shall use the services, facilities, funds, and authorities of
the Commodity Credit Corporation to carry out sections 359a
through 359i.
[(c) Definition of United States and State.--
Notwithstanding section 301, for purposes of this part, the
terms ``United States'' and ``State'' means the 50 States, the
District of Columbia, and the Commonwealth of Puerto Rico.]
* * * * * * *
Sec. 361. This part shall apply to the publication and
review of farm marketing quotas established for tobacco, corn,
wheat, cotton, [peanuts,] and rice, established under subtitle
B.
* * * * * * *
PART II--ADJUSTMENT OF QUOTAS AND ENFORCEMENT
SEC. 371. GENERAL ADJUSTMENTS OF QUOTAS
[Sec. 371 is inapplicable to the 1991 through 1995 crops of
peanuts.]
(a) If at any time the Secretary has reason to believe that
in the case of cotton, rice, [peanuts,] or tobacco the
operation of farm marketing quotas in effect will cause the
amount of such commodity which is free of marketing
restrictions to be less than the normal supply for the
marketing year for the commodity then current, he shall cause
an immediate investigation to be made with respect thereto. In
the course of such investigation due notice and opportunity for
hearing shall be given to interested persons. If upon the basis
of such investigation the Secretary finds the existence of such
fact, he shall proclaim the same forthwith. He shall also in
such proclamation specify such increase in, or termination of,
existing quotas as he finds, on the basis of such
investigation, is necessary to make the amount of such
commodity which is free of marketing restrictions equal to the
normal supply.
(b) If the Secretary has reason to believe that, because of
a national emergency or because of a material increase in
export demand, any national marketing quota or acreage
allotment for cotton, rice, [peanuts] or tobacco should be
increased or terminated, he shall cause an immediate
investigation to be made to determine whether the increase or
termination is necessary to meet such emergency or increase in
export demand. If, on the basis of such investigation, the
Secretary finds that such increase or termination is necessary,
he shall immediately proclaim such finding (and if he finds an
increase is necessary, the amount of the increase found by him
to be necessary) and thereupon such quota or allotment shall be
increased, or shall terminate, as the case may be.
* * * * * * *
SEC. 373. REPORTS AND RECORDS
(a) This subsection shall apply to warehousemen,
processors, and common carriers of corn, wheat, cotton, rice,
[peanuts,] or tobacco, and all ginners of cotton, all persons
engaged in the business of purchasing corn, wheat, cotton,
rice, peanuts, or tobacco from producers and, all persons
engaged in the business of redrying, prizing, or stemming
tobacco [for producers, all producers engaged in the production
of peanuts, 373-1 all brokers and dealers in peanuts, agents
marketing peanuts for producers, or acquiring peanuts for
buyers and dealers, and all peanut growers' cooperative
associations, all persons engaged in the business of cleaning,
shelling, crushing, and salting of peanuts and the manufacture
of peanut products, and all persons owning or operating peanut-
picking or peanut-threshing machines.] for producers. Any such
person shall, from time to time on request of the Secretary,
report to the Secretary such information and keep such records
as the Secretary finds to be necessary to enable him to carry
out the provisions of this title. Such information shall be
reported and suchrecords shall be kept in accordance with forms
which the Secretary shall prescribe. For the purpose of ascertaining
the correctness of any report made or record kept, or of obtaining
information required to be furnished in any report, but not so
furnished, the Secretary is hereby authorized to examine such books,
papers, records, accounts, correspondence, contracts, documents, and
memoranda as he has reason to believe are relevant and are within the
control of such person. Any such person failing to make any report or
keep any record as required by this subsection or making any false
report or record shall be deemed guilty of a misdemeanor and upon
conviction thereof shall be subject to a fine of not more than $500;
and any tobacco warehouseman or dealer who fails to remedy such
violation by making a complete and accurate report or keeping a
complete and accurate record as required by this subsection within
fifteen days after notice to him of such violation shall be subject to
an additional fine of $100 for each ten thousand pounds of tobacco, or
fraction thereof, bought or sold by him after the date of such
violation: Provided, That such fine shall not exceed $5,000; and notice
of such violation shall be served upon the tobacco warehouseman or
dealer by mailing the same to him by registered mail or by certified
mail or by posting the same at any established place of business
operated by him, or both. The phrase ``all producers engaged in the
production of peanuts'' was added by sec. 171(a)(2) of the Agricultural
Market Transition Act, P.L. 104-127, 110 Stat. 937, April 4, 1996, and
is effective only for the 1996 through 2002 crops of peanuts. For
similar provisions effective for prior crop years, see p. 12-2 of
Volume I--Domestic Agricultural Programs (as of Dec. 8, 1994), p. 11-2
of Volume I--Domestic Agricultural Programs (through P.L. 101-240), and
p. 16-2 of the Agriculture Handbook No. 476 (revised Jan. 1985).
(b) Farmers engaged in the production of corn, wheat,
cotton, rice, [peanuts,] or tobacco for market shall furnish
such proof of their acreage, yield, storage, and marketing of
the commodity in the form of records, marketing cards, reports,
storage under seal, or otherwise as the Secretary may prescribe
as necessary for the administration of this title.
* * * * * * *
(b) The provisions of this section shall not be applicable
if (1) there is any marketing quota penalty due with respect to
the marketing of the commodity from the farm acquired by the
Federal, State, or other agency or by the owner of the farm;
(2) any of the commodity produced on such farm has not been
accounted for as required by the Secretary; or (3) the
allotment next established for the farm acquired by the
Federal, State, or other agency would have been reduced because
of false or improper identification of the commodity produced
on or marketed from such farm or due to a false acreage report.
(c) This section shall not be applicable, in the case of
[cotton] cotton and tobacco, [and peanuts,] to any farm from
which the owner was displaced prior to 1950, in the case of
wheat and corn, to any farm from which the owner was displaced
prior to 1954, and in the case of rice, to any farm from which
the owner was displaced prior to 1955. In any case where the
cropland acquired for nonfarming purposes from an owner by an
agency having the right of eminent domain represents less than
15 per centum of the total cropland on the farm, the allotment
attributable to that portion of the farm so acquired shall be
transferred to that portion of the farm not so acquired.
* * * * * * *
AGRICULTURAL MARKETING ACT OF 1946
* * * * * * *
SEC. 272. DEFINITIONS.
In this subtitle:
(1) Dairy products.--The term ``dairy products''
[means manufactured dairy products] means--
(A) manufactured dairy products that are used
by the Secretary to establish minimum prices
for Class III and Class IV milk under a Federal
milk marketing order issued under section 8c of
the Agricultural Adjustment Act (7 U.S.C.
608c), reenacted with amendments by the
Agricultural Marketing Agreement Act of
1937[.]; and substantially identical products
designated by the Secretary.
(2) Manufacturer.--The term ``manufacturer'' means
any person engaged in the business of buying milk in
commerce for the purpose of manufacturing dairy
products.
(3) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture.
* * * * * * *
FLUID MILK PROMOTION ACT OF 1990
Subtitle H--Processor-Funded Milk Promotion Program
* * * * * * *
SEC. 1999C. DEFINITIONS.
As used in this subtitle:
(1) Advertising.--The term ``advertising'' means any
advertising or promotion program involving only fluid
milk products and directed toward increasing the
general demand for fluid milk products.
(2) Board.--The term ``Board'' means the National
Processor Advertising and Promotion Board established
under section 1999H(b).
[(3) Fluid milk product.--The term ``fluid milk
product''--
[(A) means any of the following products in
fluid or frozen form: milk, skim milk, lowfat
milk, milk drinks, buttermilk, filled milk, and
milkshake and ice milk mixes containing less
than 20 percent total solids, including any
such products that are flavored, cultured,
modified with added nonfat milk solids,
concentrated (if in a consumer-type package),
or reconstituted; and
[(B) does not include evaporated or condensed
milk (plain or sweetened), evaporated or
condensed skim milk (plain or sweetened),
formulas specially prepared for infant feeding
or dietary use that are packaged in
hermetically sealed glass or all-metal
containers, any product that contains by weight
less than 6.5 percent nonfat milk solids, and
whey.]
(3) Fluid milk product.--The term ``fluid milk
product'' has the meaning given the term in--
(A) section 1000.15 of title 7, Code of
Federal Regulations, subject to such amendments
as may be made by the Secretary; or
(B) any successor regulation.
* * * * * * *
(4) Fluid milk processor.--The term ``fluid milk
processor'' means any person who processes and markets
commercially more than [500,000] 3,000,000 pounds of
fluid milk products in consumer-type packages per
month.
* * * * * * *
SEC. 1999O. SUSPENSION OR TERMINATION OF ORDERS.
[(a) Termination of Order.--Any order effective under this
subtitle shall be terminated December 31, 2002. The Secretary
shall--]
(1) terminate the collection of assessments under the
order upon such date; and
(2) terminate activities under the order in an
orderly manner as soon as practicable after such date.
[(b)] (a) Suspension or Termination by Secretary.--The
Secretary shall, whenever the Secretary finds that the order or
any provision of the order obstructs or does not tend to
effectuate the declared policy of this subtitle, terminate or
suspend the operation of the order or provision.
[(c)] (b) Other Referenda.--
* * * * * * *
SECTION 1001 OF THE FOOD SECURITY ACT OF 1985 (7 U.S.C. 1308)
* * * * * * *
(1) Limitation on direct and counter-cyclical
payments.--The total amount of direct payments and
counter-cyclical payments to a person during any fiscal
year may not exceed $100,000, with a separate
limitation for--
(A) all contract commodities; and
(B) peanuts.
(2) Limitation on marketing loan gains and loan
deficiency payments.--The total amount of the payments
specified in paragraph (3) that a person shall be
entitled to receive under title I of the Federal
Agriculture Improvement and Reform Act of 1996 (7
U.S.C. 7201 et seq.) for 1 or more loan commodities
during any crop year may not exceed $150,000, with a
separate limitation for--
(A) all contract commodities;
(B) wool and mohair;
(C) honey; and
(D) peanuts.
(3) Description of payments subject to limitation.--
The payments referred to in paragraph (2) are the
following:
(A) Any gain realized by a producer from
repaying a marketing assistance loan under
section 131 or 158G(a) of the Federal
Agriculture Improvement and Reform Act of 1996
for a crop of any loan commodity or peanuts,
respectively, at a lower level than the
original loan rate established for the loan
commodity or peanuts under section 132 or
158G(d) of that Act, respectively.
(B) Any loan deficiency payment received for
a loan commodity or peanuts under section 135 or
158G(e) of that Act, respectively.
(4) Definitions.--In paragraphs (1) through (3):
(A) Contract commodity.--The term
``contract commodity'' has the meaning
given the term in section 102 of the
Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7202).
(B) Counter-cyclical payment.--The
term ``counter-cyclical payment'' means
a payment made under section 114 or
158D of that Act.
(C) Direct payment.--The term
``direct payment'' means a payment made
under section 113 or 158C of that Act.
(D) Loan commodity.--The term ``loan
commodity'' has the meaning given the
term in section 102 of that Act.
* * * * * * *
Sec. 713a-14. Dairy export incentive program
(a) Establishment and Operation.--During the period
beginning 60 days after December 23, 1985, and ending on
December 31, [2002] 2006, the Commoodity Credit Corporation
shall establish and operate an export incentive program as
described in this section for dairy products under section 714c
of this title.
* * * * * * *
Sec. 1308. Payment limitations: production flexibility contracts,
marketing loan gains and deficiencies, contract
commodities and oilseeds; regulations
Notwithstanding any other provision of law:
[(1) Limitation on payments under production
flexibility contracts.--The total amount of contract
payments made under the Agricultural Market Transition
Act [7 U.S.C.A. Sec. 7201 et seq.] to a person under 1
or more production flexibility contracts during any
fiscal year may not exceed $40,000.
[(2) Limitation on marketing loan gains and loan
deficiency payments.--The total amount of the payments
specified in paragraph (3) that a person shall be
entitled to receive under the Agricultural Market
Transition Act [7 U.S.C.A. Sec. 7201 et seq.] for 1 or
more contract commodities and oilseeds during any crop
year may not exceed $75,000.
[(3) Description of payments subject to limitation.--
The payments referred to in paragraph (2) are the
following:
[(A) Any gain realized by a producer from
repaying a marketing assistance loan under
section 131 of the Agricultural Market
Transition Act [7 U.S.C.A. Sec. 7231] for a
crop of any loan commodity at a lower level
than the original loan rate established for the
loan commodity under section 132 of the Act [7
U.S.C.A. Sec. 7232].
[(B) Any loan deficiency payment received for
a loan commodity under section 135 of the Act
[7 U.S.C.A. Sec. 7235].
[(4) Definitions.--In this title, the terms
``contract commodity'', ``contract payment'', ``loan
commodity'', ``oilseed'', and ``production flexibility
contract'' have the meaning given those terms in
section 102 of the Agricultural Market Transition Act
[7 U.S.C.A. Sec. 7202].]
(1) Limitation on direct and counter-cyclical
payments.--The total amount of direct payments and
counter-cyclical payments to a person during any fiscal
year may not exceed $100,000, with a separate
limitation for--
(A) all contract commodities; and
(B) peanuts.
(2) Limitation on marketing loan gains and loan
deficiency payments.--The total amount of the payments
specified in paragraph (3) that a person shall be
entitled to receive under title I of the Federal
Agricultural Improvement and Reform Act of 1996 (7
U.S.C. 7201 et seq.) for 1 or more loan commodities
during any crop year may not exceed $150,000, with a
separate limitation for--
(A) all contract commodities;
(B) wool and mohair;
(C) honey; and
(D) peanuts.
(3) Description of payments subject to limitation.--
The payments referred to in paragraph (2) are the
following:
(A) Any gain realized by a producer from
repaying a marketing assistance loan under
section 131 or 158G(a) of the Federal
Agriculture Improvement and Reform Act of 1996
for a crop of any loan commodity or peanuts,
respectively, at a lower level than the
original loan rate established for the loan
commodity or peanuts under section 132 or
158G(d) of that Act, respectively.
(B) Any loan deficiency payment received for
a loan commodity or peanuts under section 135
or 158G(e) of that Act, respectively.
(4) Definitions.--In paragraphs (1) through (3):
(A) Contract commodity.--The term ``contract
commodity'' has the meaning given the term in
section 102 of the Federal Agriculture
Improvement and Reform Act of 1996 (7 U.S.C.
7202).
(B) Counter-cyclical payment.--The term
``counter-cyclical payment'' means a payment
made under section 114 or 158D of that Act.
(C) Direct payment.--The term ``direct
payment'' means a payment made under section
113 or 158C of that Act.
(D) Loan commodity.--The term ``loan
commodity'' has the meaning given the term in
section 102 of that Act.
* * * * * * *
Sec. 6414. Suspension or termination of orders
[(a) Termination of Order.--Any order effective under this
chapter shall be terminated December 31, 2002. The Secretary
shall--
[(1) terminate the collection of assessments under
the order upon such date; and
[(2) terminate activities under the order in an
orderly manner as soon as practicable after such date.]
[(b)] (a) Suspension or Termination by Secretary.--The
Secretary shall, whenever the Secretary finds that the order or
any provision of the order obstructs or does not tend to
effectuate the declared policy of this chapter, terminate or
suspend the operation of the order or provision.
[(c)] (b) Other Referenda.--
(1) In general.--The Secretary may conduct at any
time a referendum of persons who, during a
representative period as determined by the Secretary,
have been fluid milk processors on whether to suspend
or terminate the order, and shall hold such a
referendum on request of the Board or any group of such
processors that among them marketed during a
representative period, as determined by the Secretary,
10 percent or more of the volume of fluid milk products
marketed by fluid milk processors voting in the
preceding referendum.
* * * * * * *
Sec. 470l. Expiration of dairy farmer indemnity program
The authority granted under sections 450j to 450l of this
title shall expire on September 30, 2006.
* * * * * * *
TITLE 2--CONSERVATION
FEDERAL AGRICULTURE IMPROVEMENT AND REFORM ACT OF 1996
* * * * * * *
SEC. 356. CORPORATE POWERS AND OBLIGATIONS OF THE FOUNDATION.
(a) In General.--The Foundation--
* * * * * * *
(2) to acquire by purchase or exchange any real or
personal property or interest in property, except that
funds provided under section 360 may not be used to
purchase an interest in real property;
(3) unless otherwise required by instrument of
transfer, to sell, donate, lease, invest, reinvest,
retain, or otherwise dispose of any property or income
from property;
(4) on the written approval of the Secretary, to use,
license, or transfer symbols, slogans, and logos of the
Department;
[(4)] (5) to borrow money from private sources and
issue bonds, debentures, or other debt instruments,
subject to section 359, except that the aggregate
amount of the borrowing and debt instruments
outstanding at any time may not exceed $1,000,000;
[(5)] (6) to sue and be sued, and complain and defend
itself, in any court of competent jurisdiction, except
that a member of the Board shall not be personally
liable for an action in the performance of services for
the Board, except for gross negligence;
[(6)] (7) to enter into a contract or other agreement
with an agency of State or local government,
educational institution, or other private organization
or person and to make such payments as may be necessary
to carry out the functions of the Foundation; and
[(7)] (8) to do any and all acts that are necessary
to carry out the purposes of the Foundation.
(d) Interests in Property.--
(1) Interests in real property.--The Foundation may
acquire, hold, and dispose of lands, waters, or other
interests in real property by donation, gift, devise,
purchase, or exchange. An interest in real property
shall be treated, among other things, as including an
easement or other right for the preservation,
conservation, protection, or enhancement of
agricultural, natural, scenic, historic, scientific,
educational, inspirational, or recreational resources.
(2) Gifts.--A gift, devise, or bequest may be
accepted by the Foundation even though the gift,
devise, or bequest is encumbered, restricted, or
subject to a beneficial interest of a private person if
any current or future interest in the gift, devise, or
bequest is for the benefit of the Foundation.
(3) Use of symbols, slogans, and logos.--
(A) In general.--The Secretary may authorize
the Foundation to use, license, or transfer
symbols, slogans, and logos of the Department.
(B) Income.--
(i) In general.--All revenue received
by the Foundation from the use,
licensing, or transfer of symbols,
slogans, and logos of the Department
shall be transferred to the Secretary.
(ii) Conservation operations.--The
Secretary shall transfer all revenue
received under clause (i) to the
account within the Natural Resources
Conservation Service that is used to
carry out conservation operations.
* * * * * * *
[SEC. 386. CONSERVATION OF PRIVATE GRAZING LAND.
[(a) Findings.--Congress finds that--
[(1) private grazing land constitutes nearly 1/2 of
the non-Federal land of the United States and is basic
to the environmental, social, and economic stability of
rural communities;
[(2) private grazing land contains a complex set of
interactions among soil, water, air, plants, and
animals;
[(3) grazing land constitutes the single largest
watershed cover type in the United States and
contributes significantly to the quality and quantity
of water available for all of the many uses of the
land;
[(4) private grazing land constitutes the most
extensive wildlife habitat in the United States;
[(5) private grazing land can provide opportunities
for improved nutrient management from land application
of animal manures and other by-product nutrient
resources;
[(6) owners and managers of private grazing land need
to continue to recognize conservation problems when the
problems arise and receive sound technical assistance
to improve or conserve grazing land resources to meet
ecological and economic demands;
[(7) new science and technology must continually be
made available in a practical manner so owners and
managers of private grazing land may make informed
decisions concerning vital grazing land resources;
[(8) agencies of the Department with private grazing
land responsibilities are the agencies that have the
expertise and experience to provide technical
assistance, education, and research to owners and
managers of private grazing land for the long-term
productivity and ecological health of grazing land;
[(9) although competing demands on private grazing
land resources are greater than ever before, assistance
to private owners and managers of private grazing land
is currently limited and does not meet the demand and
basic need for adequately sustaining or enhancing the
private grazing land resources; and
[(10) private grazing land can be enhanced to provide
many benefits to all citizens of the United States
through voluntary cooperation among owners and managers
of the land, local conservation districts, and the
agencies of the Department responsible for providing
assistance to owners and managers of land and to
conservation districts.
[(b) Purpose.--It is the purpose of this section to
authorize the Secretary to provide a coordinated technical,
educational, and related assistance program to conserve and
enhance private grazing land resources and provide related
benefits to all citizens of the United States by--
[(1) establishing a coordinated and cooperative
Federal, State, and local grazing conservation program
for management of private grazing land;
[(2) strengthening technical, educational, and
related assistance programs that provide assistance to
owners and managers of private grazing land;
[(3) conserving and improving wildlife habitat on
private grazing land;
[(4) conserving and improving fish habitat and
aquatic systems through grazing land conservation
treatment;
[(5) protecting and improving water quality;
[(6) improving the dependability and consistency of
water supplies;
[(7) identifying and managing weed, noxious weed, and
brush encroachment problems on private grazing land;
and
[(8) integrating conservation planning and management
decisions by owners and managers of private grazing
land, on a voluntary basis.
[(c) Definitions.--In this section:
[(1) Department.--The term ``Department'' means the
Department of Agriculture.
[(2) Private grazing land.--The term ``private
grazing land'' means private, State-owned, tribally-
owned, and any other non-federally owned rangeland,
pastureland, grazed forest land, and hay land.
[(3) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture.
[(d) Private Grazing Land Conservation Assistance.--
[(1) Assistance to grazing landowners and others.--
Subject to the availability of appropriations for this
section, the Secretary shall establish a voluntary
program to provide technical, educational, and related
assistance to owners and managers of private grazing
land and public agencies, through local conservation
districts, to enable the landowners, managers, and
public agencies to voluntarily carry out activities
that are consistent with this section, including--
[(A) maintaining and improving private
grazing land and the multiple values and uses
that depend on private grazing land;
[(B) implementing grazing land management
technologies;
[(C) managing resources on private grazing
land, including--
[(i) planning, managing, and treating
private grazing land resources;
[(ii) ensuring the long-term
sustainability of private grazing land
resources;
[(iii) harvesting, processing, and
marketing private grazing land
resources; and
[(iv) identifying and managing weed,
noxious weed, and brush encroachment
problems;
[(D) protecting and improving the quality and
quantity of water yields from private grazing
land;
[(E) maintaining and improving wildlife and
fish habitat on private grazing land;
[(F) enhancing recreational opportunities on
private grazing land;
[(G) maintaining and improving the aesthetic
character of private grazing lands; and (
[(H) identifying the opportunities and
encouraging the diversification of private
grazing land enterprises.
[(2) Program elements.--
[(A) Funding.--If funding is provided to
carry out this section, it shall be provided
through a specific line-item in the annual
appropriations for the Natural Resources
Conservation Service.
[(B) Technical assistance and education.--
Personnel of the Department trained in pasture
and range management shall be made available
under the program to deliver and coordinate
technical assistance and education to owners
and managers of private grazing land, at the
request of the owners and managers.
[(e) Grazing Technical Assistance Self-Help.--
[(1) Findings.--Congress finds that--
[(A) there is a severe lack of technical
assistance for farmers and ranchers who graze
livestock;
[(B) Federal budgetary constraints preclude
any significant expansion, and may force a
reduction of, current levels of technical
support; and
[(C) farmers and ranchers have a history of
cooperatively working together to address
common needs in the promotion of their products
and in the drainage of wet areas through
drainage districts.
[(2) Establishment of grazing demonstration.--In
accordance with paragraph (3), the Secretary may
establish 2 grazing management demonstration districts
at the recommendation of the grazing lands conservation
initiative steering committee.
[(3) Procedure.--
[(A) Proposal.--Within a reasonable time
after the submission of a request of an
organization of farmers or ranchers engaged in
grazing, the Secretary shall propose that a
grazing management district be established.
[(B) Funding.--The terms and conditions of
the funding and operation of the grazing
management district shall be proposed by the
producers.
[(C) Approval.--The Secretary shall approve
the proposal if the Secretary determines that
the proposal--
[(i) is reasonable;
[(ii) will promote sound grazing
practices; and
[(iii) contains provisions similar to
the provisions contained in the beef
promotion and research order issued
under section 4 of the Beef Research
and Information Act (7 U.S.C. 2903) in
effect on the date of enactment of this
Act.
[(D) Area included.--The area proposed to be
included in a grazing management district shall
be determined by the Secretary on the basis of
a petition by farmers or ranchers.
[(E) Authorization.--The Secretary may use
authority under the Agricultural Adjustment Act
(7 U.S.C. 601 et seq.), reenacted with
amendments by the Agricultural Marketing
Agreement Act of 1937, to operate, on a
demonstration basis, a grazing management
district.
[(F) Activities.--The activities of a grazing
management district shall be scientifically
sound activities, as determined by the
Secretary in consultation with a technical
advisory committee composed of ranchers,
farmers, and technical experts.
[(f) Authorization of Appropriations.--There are authorized
to be appropriated to carry out this section--
[(1) $20,000,000 for fiscal year 1996;
[(2) $40,000,000 for fiscal year 1997; and
[(3) $60,000,000 for fiscal year 1998 and each
subsequent fiscal year.
* * * * * * *
[SEC. 388. FARMLAND PROTECTION PROGRAM.
[(a) In General.--The Secretary of Agriculture shall
establish and carry out a farmland protection program under
which the Secretary shall purchase conservation easements or
other interests in not less than 170,000, nor more than
340,000, acres of land with prime, unique, or other productive
soil that is subject to a pending offer from a State or local
government for the purpose of protecting topsoil by limiting
nonagricultural uses of the land.
[(b) Conservation Plan.--Any highly erodible cropland for
which a conservation easement or other interest is purchased
under this section shall be subject to the requirements of a
conservation plan that requires, at the option of the
Secretary, the conversion of the cropland to less intensive
uses.
[(c) Funding.--The Secretary shall use not more than
$35,000,000 of the funds of the Commodity Credit Corporation to
carry out this section.]
* * * * * * *
FOOD SECURITY ACT OF 1985
* * * * * * *
SEC. 1230. [ENVIRONMENTAL CONSERVATION ACREAGE RESERVE PROGRAM]
COMPREHENSIVE CONSERVATION ENHANCEMENT PROGRAM.
(a) Establishment.--
(1) In general.--During the 1996 through [2002] 2006
calendar years, the Secretary shall establish an
[environmental conservation acreage reserve program]
comprehensive conservation enhancement program
(referred to in this section as [``ECARP''] ``CCEP'')
to be implemented through contracts and the acquisition
of easements to assist owners and operators of farms
and ranches to conserve and enhance soil, water, and
related natural resources, including grazing land,
wetland, and wildlife habitat.
(2) Means.--The Secretary shall carry out the [ECARP]
CCEP by--
(A) providing for the long-term protection of
environmentally sensitive land; and
(B) providing technical and financial
assistance to farmers and ranchers to--
(i) improve the management and
operation of the farms and ranches; and
(ii) reconcile productivity and
profitability with protection and
enhancement of the environment.
(3) Programs.--The [ECARP] CCEP shall consist of--
(A) the conservation reserve program
established under subchapter B;
(B) the wetlands reserve program established
under subchapter C; and
(C) the environmental quality incentives
program established under chapter 4.
(b) Administration.--
(1) In general.--In carrying out the [ECARP] CCEP,
the Secretary shall enter into contracts with owners
and operators and acquire interests in land through
easements from owners, as provided in this chapter and
chapter 4.
(2) Prior enrollments.--Acreage enrolled in the
conservation reserve or wetlands reserve program prior
to the date of enactment of this paragraph shall be
considered to be placed into the [ECARP] CCEP.
* * * * * * *
[SEC. 1230A. GOOD FAITH RELIANCE.
[(a) In General.--Except as provided in subsection (d) and
notwithstanding any other provision of this chapter, the
Secretary shall provide equitable relief to an owner or
operator that has entered into a contract under this chapter,
and that is subsequently determined to be in violation of the
contract, if the owner or operator in attempting to comply with
the terms of the contract and enrollment requirements took
actions in good faith reliance on the action or advice of an
authorized representative of the Secretary.
[(b) Types of Relief.--The Secretary shall--
[(1) to the extent the Secretary determines that an
owner or operator has been injured by good faith
reliance described in subsection (a), allow the owner
or operator to do any one or more of the following--
[(A) to retain payments received under the
contract;
[(B) to continue to receive payments under
the contract;
[(C) to keep all or part of the land covered
by the contract enrolled in the applicable
program under this chapter;
[(D) to reenroll all or part of the land
covered by the contract in the applicable
program under this chapter; or
[(E) or any other equitable relief the
Secretary deems appropriate; and
[(2) require the owner or operator to take such
actions as are necessary to remedy any failure to
comply with the contract.
[(c) Relation to Other Law.--The authority to provide
relief under this section shall be in addition to any other
authority provided in this or any other Act.
[(d) Exception.--This section shall not apply to a pattern
of conduct in which an authorized representative of the
Secretary takes actions or provides advice with respect to an
owner or operator that the representative and the owner or
operator know are inconsistent with applicable law (including
regulations).
[(e) Applicability of Relief.--Relief under this section
shall be available for contracts in effect on January 1, 2000
and for all subsequent contracts.
[Subchapter B--Conservation Reserve]
SEC. 1231. CONSERVATION RESERVE.
(a) In General.--Through the [2002] 2006 calendar year, the
Secretary shall formulate and carry out the enrollment of lands
in a conservation reserve program through the use of contracts
to assist owners and operators of lands specified in subsection
(b) to conserve and improve the soil and water resources of
such lands.
(b) Eligible Lands.--The Secretary may include in the
program established under this subchapter--
[(1) highly erodible croplands that--
[(A) if permitted to remain untreated could
substantially reduce the production capability
for future generations; or
[(B) can not be farmed in accordance with a
plan under section 1212;]
(1) highly erodible cropland that--
(A)(i) if permitted to remain untreated could
substantially reduce the production capability
for future generations; or
(ii) cannot be farmed in accordance with a
conservation plan that complies with the
requirements of subtitle B; and
(B) the Secretary determines had a cropping
history or were considered to be planted for 3
of the 6 years preceding the date of enactment
of the Agriculture, Conservation, and Rural
Enhancement Act of 2001 (except for land
enrolled in the conservation reserve program on
that date);'';
(2) marginal pasture lands converted to wetland or
established as wildlife habitat prior to the enactment
of the Food, Agriculture, Conservation, and Trade Act
of 1990;
(3) marginal pasture lands to be devoted to trees in
or near riparian areas or for similar water quality
purposes, not to exceed 10 percent of the number of
acres of land that is placed in the conservation
reserve under this subchapter in each of the 1991
through [2002] 2006 calendar years;
(A) if the Secretary determines that (i) such
lands contribute to the degradation of water
quality or would pose an on-site or off-site
environmental threat to water quality if
permitted to remain in agricultural production,
and (ii) water quality objectives with respect
to such land cannot be achieved under the water
quality incentives program established under
chapter 2;
* * * * * * *
(d) Maximum Enrollment.--The Secretary may maintain up to
[36,400,000] 40,000,000 acres in the conservation reserve at
any one time during the 1986 through [2002] 2006 calendar years
(including contracts extended by the Secretary pursuant to
section 1437(c) of the Food, Agriculture, Conservation, and
Trade Act of 1990 (Public Law 101-624; 16 U.S.C. 3831 note)).
(e) Duration of Contract.--
(1) In general.--For the purpose of carrying out this
subchapter, the Secretary shall enter into contracts of
not less than 10, nor more than 15, years.
(2) Certain lands.--[In the]
(A) In general.--In the case of land devoted
to hardwood trees, shelterbelts, windbreaks, or
wildlife corridors under a contract entered
into under this subchapter after October 1,
1990, and land devoted to such uses under
contracts modified under section 1235A, the
owner or operator of such land may, within the
limitations prescribed under this section,
specify the duration of the contract. [The
Secretary]
(B) Existing hardwood tree contracts.--The
Secretary may, in the case of land that is
devoted to hardwood trees under a contract
entered into under this subchapter prior to
October 1, 1990, extend such contract for not
to exceed 5 years, as agreed to by the owner or
operator of such land and the Secretary.
(C) Extension of hardwood tree contracts.--
(i) In general.--In the case of land
devoted to hardwood trees under a
contract entered into under this
subchapter before the date of enactment
of this subparagraph, the Secretary may
extend the contract for a term of not
more than 15 years.
(ii) Rental payments.--The amount of
a rental payment for a contract
extended under clause (i)--
(I) shall be determined by
the Secretary; but
(II) shall not exceed 50
percent of the rental payment
that was applicable to the
contract before the contract
was extended.''.
* * * * * * *
(4) Duty of secretary.--In utilizing the authority
granted under this subsection, the Secretary shall
attempt to maximize water quality and habitat benefits
in such watersheds by promoting a significant level of
enrollment of lands within such watersheds in the
program under this subchapter by whatever means the
Secretary determines appropriate and consistent with
the purposes of this subchapter.
(5) Priority.--In designating conservation priority
areas under paragraph (1), the Secretary shall give
priority to areas in which designated land would
facilitate the most rapid completion of projects that--
(A) are ongoing as of the date of the
application; and
(B) meet the purposes of the program
established under this subchapter.
(g) Multi-year Grasses and Legumes.--For purposes of this
subchapter, alfalfa and othermulti-year grasses and legumes in
a rotation practice, approved by the Secretary, shall be considered
agricultural commodities.
(h) [Pilot] Program for Enrollment of Wetland and Buffer
Acreage in Conservation Reserve.--
(1) In general.--[During the 2001 and 2002 calendar
years, the Secretary shall carry out a pilot program]
During the 2001 and 2002 calendar years, the Secretary
shall carry out a program in the States of Iowa,
Minnesota, Montana, Nebraska, North Dakota, and South
Dakota under which the Secretary shall include eligible
acreage described in paragraph (3) in the program
established under this subchapter.
(2) Participation among states.--The Secretary shall
ensure, to the maximum extent practicable, that owners
and operators in each of the States referred to in
paragraph (1) have an equitable opportunity to
participate in the [pilot] program established under
this subsection.
* * * * * * *
(D) Owner or operator limitations.--
(i) Wetland.--The maximum size of any
wetland described in subparagraph
(A)(i) of an owner or operator enrolled
in the conservation reserve under this
subsection shall be [5 contiguous
acres] 10 contiguous acres, of which--
(I) not more than 5 acres
shall be eligible for payment;
and
(II) all acres (including
acres that are ineligible for
payment) shall be covered by
the conservation contract.
* * * * * * *
(C) Incentives.--The amounts payable to
owners and operators in the form of rental
payments under contracts entered into under
this subsection shall reflect incentives that
are provided to owners and operators to enroll
filterstrips in the conservation reserve under
section 1234[.] and
(5) the portion of land in a field not enrolled in
the conservation reserve in a case in which more than
50 percent of the land in the field is enrolled as a
buffer under a program described in section 1234(i)(1),
if the land is enrolled as part of the buffer;
(6) land (including land that is not cropland)
enrolled through continuous signup--
(A) to establish conservation buffers as part
of the program described in a notice issued on
March 24, 1998 (63 Fed. Reg. 14109) or a
successor program; or
(B) into the conservation reserve enhancement
program described in a notice issued on May 27,
1998 (63 Fed. Reg. 28965) or a successor
program.
* * * * * * *
(A) to forfeit all rights to rental payments
and cost sharing payments under the contract;
[and]
(B) to refund to the United States all rental
payments and cost sharing payments received by
the owner or operator, or accept such payment
adjustments or make such refunds as the
Secretary considers appropriate and consistent
with the objectives of this subchapter, unless
the transferee of such land agrees with the
Secretary to assume all obligations of the
contract; Provided however, no refund of rental
payments and cost sharing payments shall be
required when the land is purchased by or for
the United States Fish and Wildlife Service, or
the transferee and the Secretary agree to
modifications to such contract, where such
modifications are consistent with the
objectives of the program as determined by the
Secretary; and
(C) in the case of marginal pasture land, an
owner or operator shall not be required to
plant trees if native prairie grass may be
retained or restored;
* * * * * * *
(7) not to conduct any harvesting or grazing, nor
otherwise make commercial use of the forage, on land
that is subject to the contract, nor adopt any similar
practice specified in the contract by the Secretary as
a practice that would tend to defeat the purposes of
the contract, [except that the Secre-
tary--] except that--
[(A) may] (A) the Secretary may permit--
(i) harvesting or grazing or other
commercial use of the forage on land
that is subject to the contract in
response to a drought or other similar
emergency; [and]
* * * * * * *
[(B) shall] (B) the Secretary shall approve
not more than six projects, no more than one of
which may be in any State, under which land
subject to the contract may be harvested for
recovery of biomass used in energy production
if--
* * * * * * *
(C) the total acres for all of the projects
shall not exceed 250,000 acres[.]; and
(D) for maintenance purposes, the Secretary
shall permit harvesting or grazing or other
commercial uses of forage, in a manner that is
consistent with the purposes of this subchapter
and a conservation plan approved by the
Secretary, on acres enrolled--
(i) to establish conservation buffers
as part of the program described in a
notice issued on March 24, 1998 (63
Fed. Reg. 14109) or a successor
program; and
(ii) into the conservation reserve
enhancement program described in a
notice issued on May 27, 1998 (63 Fed.
Reg. 28965) or a successor program.
(8) not to conduct any planting of trees on land that
is subject to the contract unless the contract
specifies that the harvesting and commercial sale of
trees such as Christmas trees are prohibited, nor
otherwise make commercial use of trees on land that is
subject to the contract unless it is expressly
permitted in the contract, nor adopt any similar
practice specified in the contract by the Secretary as
a practice that would tend to defeat the purposes of
the contract, except that no contract shall prohibit
activities consistent with customary forestry practice,
such as pruning, thinning, or stand improvement of
trees, on lands converted to forestry use;
(9) not to adopt any practice specified by the
Secretary in the contract as a practice that would tend
to defeat the purposes of this subchapter; [and]
(10) with respect to any contract entered into after
the date of enactment of the Agriculture, Conservation,
and Rural Enhancement Act of 2001--
(A) not to produce a crop for the duration of
the contract on any other highly erodible land
that the owner or operator owns unless the
highly erodible land--
(i) has a history of being used to
produce a crop other than a forage
crop, as determined by the Secretary;
or
(ii) is being used as a homestead or
building site at the time of purchase;
and
(B) on a violation of a contract described in
subparagraph (A), to be subject to the
requirements paragraph (5); and
[(10)] (11) to comply with such additional provisions
as the Secretary determines are desirable and are
included in the contract to carry out this subchapter
or to facilitate the practical administration thereof.
* * * * * * *
(d) Alley-Cropping.--
* * * * * * *
(e) Foreclosure.--Notwithstanding any other provision of
law, an owner or operator who is a party to a contract entered
into under this subchapter may not be required to make
repayments to the Secretary of amounts received under such
contract if the land that is subject to such contract has been
foreclosed upon and the Secretary determines that forgiving
such repayments is appropriate in order to provide fair and
equitable treatment. This subsection shall not void the
responsibilities of such an owner or operator under the
contract if such owner or operator resumes control over the
property that is subject to the contract within the period
specified in the contract. Upon the resumption of such control
over the property by the owner or operator, the provisions of
the contract in effect on the date of the foreclosure shall
apply.
(f) Wind Turbines.--
(1) In general.--Subject to paragraph (2), the
Secretary may permit an owner or operator of land that
is enrolled in the conservation reserve program, but
that is not enrolled under continuous signup (as
described in section 1231(b)(6)) to install wind
turbines on the land.
(2) Number; location.--The Secretary shall determine
the number and location of wind turbines that may be
installed on a tract of land under paragraph (1),
taking into account--
(A) the location, size, and other physical
characteristics of the land;
(B) the extent to which the land contains
wildlife and wildlife habitat; and
(C) the purposes of the conservation reserve
program.
(3) Payment limitation.--Notwithstanding the amount
of a rental payment limited by section 1234(c)(2) and
specified in a contract entered into under this
chapter, the Secretary shall reduce the amount of the
rental payment paid to an owner or operator of land on
which 1 or more wind turbines are installed under this
subsection by an amount determined by the Secretary to
be commensurate with the value of the reduction of
benefit gained by enrollment of the land in the
conservation reserve program.
* * * * * * *
Sec. 1234. (a) The Secretary shall provide payment for
obligations incurred by the Secretary under a contract entered
into under this subchapter--
(1) with respect to any cost-sharing payment
obligation incurred by the Secretary, as soon as
possible after the obligation is incurred; and
(2) with respect to any annual rental payment
obligation incurred by the Secretary--
(A) as soon as practicable after October 1 of
each calendar year; or
(B) at the discretion of the Secretary, at
any time prior to such date during the year
that the obligation is incurred.
(b)(1) In making cost sharing payments to an owner or
operator under a contract entered into under this subchapter,
[the Secretary] Except for land enrolled under continuous
signup or under the conservation reserve enhancement program
described in a notice issued on May 27, 1998 (63 Fed. Reg.
28965) (or a successor program), the Secretary shall pay 50
percent of the cost of establishing water quality and
conservation measures and practices required under such
contracts for which the Secretary determines that cost-sharing
is appropriate and in the public interest.
* * * * * * *
(h) In addition to any payment under this subchapter, an
owner or operator may receive cost share assistance, rental
payments, or tax benefits from a State or subdivision thereof
for enrolling lands in the conservation reserve program.
(i) Payments.--
(1) In general.--Subject to paragraph (2), the
Secretary shall provide signing and practice incentive
payments under the conservation reserve program to
owners and operators that implement a practice under--
(A) the program to establish conservation
buffers described in a notice issued on March
24, 1998 (63 Fed. Reg. 14109) or a successor
program; or
(B) the conservation reserve enhancement
program described in a notice issued on May 27,
1998 (63 Fed. Reg. 28965) or a successor
program.
(2) Other practices.--The Secretary shall administer
paragraph (1) in a manner that does not reduce the
amount of payments made by the Secretary for other
practices under the conservation reserve program.
* * * * * * *
SEC. 1237. WETLANDS RESERVE PROGRAM.
(a) Establishment.--The Secretary shall establish a
wetlands reserve program to assist owners of eligible lands in
restoring and protecting wetlands (including the provision of
technical assistance.)
(b) Enrollment Conditions.--
[(1) Maximum enrollment.--The total number of acres
enrolled in the wetlands reserve program shall not
exceed 975,000 acres.]
(1) Maximum enrollment.--
(A) In general.--The total number of acres
enrolled in the wetlands reserve program shall
not exceed 2,225,000 acres, of which, to the
maximum extent practicable subject to
subparagraph (B), the Secretary shall enroll
250,000 acres in each calendar year.
(B) Wetlands reserve enhancement acreage.--Of
the acreage enrolled under subparagraph (A) for
a calendar year, not more than 25,000 acres may
be enrolled in the wetlands reserve enhancement
program described in subsection (h).
* * * * * * *
(g) Easements.--The Secretary shall enroll lands in the
wetland reserve through the purchase of easements as provided
for in section 1237A.
(h) Wetlands Reserve Enhancement Program.--
(1) In general.--The Secretary may enter into
cooperative agreements with State or local governments,
and with private organizations, to develop, on land
that is enrolled, or is eligible to be enrolled, in the
wetland reserve established under this subchapter,
wetland restoration activities in watershed areas.
(2) Purpose.--The purpose of the agreements shall be
to address critical environmental issues.
(3) Limitation.--The total number of acres that may
be covered by agreements entered into under this
subsection shall not exceed 25,000 acres for each
calendar year.
* * * * * * *
SEC. 1237C. DUTIES OF THE SECRETARY.
(a) In General.--In return for the granting of an easement
by an owner under this subchapter, the Secretary shall--
(1) share the cost of carrying out the establishment
of conservation measures and practices, and the
protection of the wetland functions and values, as set
forth in the plan to the extent that the Secretary
determines that cost sharing is appropriate and in the
public interest; and
(2) provide necessary technical [assistance]
assistance (including monitoring and maintenance) to
assist owners in complying with the terms and
conditions of the easement and the plan.
* * * * * * *
[CHAPTER 2--AGRICULTURAL WATER QUALITY INCENTIVES]
CHAPTER 2--CONSERVATION SECURITY AND FARMLAND PROTECTION
Subchapter A--Conservation Security Program
SEC. 1238. DEFINITIONS.
In this subchapter:
(1) Base payment.--The term ``base payment'' means
the amount paid to an producer under a conservation
security contract that is equal to the total of the
amounts described in clauses (i) and (ii) of
subparagraphs (C), (D), or (E) of section 1238C(b)(1),
as appropriate.
(2) Beginning farmer or rancher.--The term
``beginning farmer or rancher'' has the meaning
provided under section 343(a) of the Consolidated Farm
and Rural Development Act (7 U.S.C. 1999(a)).
(3) Bonus amount.--The term `bonus amount' means the
amount paid to a producer under a conservation security
contract that is equal to the total of the amounts
described in clauses (iii) and (iv) of subparagraph
(C), and of clause (iii) of subparagraph (D) or (E), of
section 1238C(b)(1), as appropriate.
(4) Conservation practice.--The term `conservation
practice' means a land-based farming technique that--
(A) requires planning, implementation,
management, and maintenance; and
(B) promotes 1 or more of the purposes
described in section 1238A(a).
(5) Conservation security contract.--The term
``conservation security contract'' means a contract
described in section 1238A(e).
(6) Conservation security plan.--The term
``conservation security plan'' means a plan described
in section 1238A(c).
(7) Conservation security program.--The term
``conservation security program'' means the program
established under section 1238A(a).
(8) Continuous signup.--The term ``continuous
signup'', with respect to land, means land enrolled in
a program described in section 1231(b)(6)(A) on which
conservation practices are carried out.
(9) Indian tribe.--The term ``Indian tribe'' has the
meaning given the term in section 4 of the Indian Self-
Determination and Education Assistance Act (25 U.S.C.
450b).
(10) Nutrient management.--The term ``nutrient
management'' means management of the quantity, source,
placement, form, and timing of the land application of
nutrients and other additions to soil on land enrolled
in the conservation security program--
(A) to achieve or maintain adequate soil
fertility for agricultural production;
(B) to minimize the potential for loss of
environmental quality, including soil, water,
fish and wildlife habitat, and air and water
quality; or
(C) to reduce energy consumption.
(11) Producer.--The term ``producer'' has the meaning
given the term in section 102 of the Agricultural
Market Transition Act (7 U.S.C. 7202).
(12) Resource of concern.--The term ``resource of
concern'' means a conservation priority of a State and
locality under section 1238A(c)(3).
(13) Resource-conserving crop.--The term ``resource-
conserving crop'' means--
(A) a perennial grass;
(B) a legume grown for use as--
(i) forage;
(ii) seed for planting; or
(iii) green manure;
(C) a legume-grass mixture;
(D) a small grain grown in combination with a
grass or legume, whether interseeded or planted
in succession; and
(E) such other plantings, including trees and
annual grasses, as the Secretary considers
appropriate for a particular area.
(14) Resource-conserving crop rotation.--The term
``resource-conserving crop rotation'' means a crop
rotation that--
(A) includes at least 1 resource-conserving
crop;
(B) reduces erosion;
(C) improves soil fertility and tilth; and
(D) interrupts pest cycles.
(15) Resource management system.--The term ``resource
management system'' means a system of conservation
practices and management relating to land or water use
that is designed to prevent resource degradation and
permit sustained use of land and water, as defined in
accordance with the technical guide of the Natural
Resources Conservation Service.
(16) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture, acting through the Natural
Resources Conservation Service.
(17) Tier i conservation practice.--The term ``Tier I
conservation practice'' means a conservation practice
described in section 1238A(d)(4)(A)(ii).
(18) Tier i conservation security contract.--The term
``Tier I conservation security contract'' means a
contract described in section 1238A(d)(4)(A).
(19) Tier ii conservation practice.--The term ``Tier
II conservation practice'' means a conservation
practice described in section 1238A(d)(4)(B)(ii).
(20) Tier ii conservation security contract.--The
term ``Tier II conservation security contract'' means a
contract described in section 1238A(d)(4)(B).
(21) Tier iii conservation practice.--The term ``Tier
III conservation practice'' means a conservation
practice described in section 1238A(d)(4)(C)(ii).
(22) Tier iii conservation security contract.--The
term ``Tier III conservation security contract'' means
a contract described in section 1238A(d)(4)(C).
SEC. 1238A. CONSERVATION SECURITY PROGRAM.
(a) In General.--For each of fiscal years 2003 through
2006, the Secretary shall establish a conservation security
program to assist owners and operators of agricultural
operations to promote, as is applicable for each operation--
(1) conservation of soil, water, energy, and other
related resources;
(2) soil quality protection and improvement;
(3) water quality protection and improvement;
(4) air quality protection and improvement;
(5) soil, plant, or animal health and well-being;
(6) diversity of flora and fauna;
(7) on-farm conservation and regeneration of
biological resources, including plant and animal
germplasm;
(8) wetland restoration, conservation, and
enhancement;
(9) wildlife habitat management, with special
emphasis on species identified by any natural heritage
program of the applicable State;
(10) reduction of greenhouse gas emissions and
enhancement of carbon sequestration;
(11) environmentally sound management of invasive
species;
(12) enhancement of conservation technology and
resource management practices approved by the
Secretary; or
(13) any similar conservation purpose (as determined
by the Secretary).
(b) Eligibility.--
(1) Eligible owners and operators.--To be eligible to
participate in the conservation security program (other
than to receive technical assistance under section
1238C(g) for the development of conservation security
contracts), a producer shall--
(A) develop and submit to the Secretary, and
obtain the approval of the Secretary of, a
conservation security plan that meets the
requirements of subsection (c)(1); and
(B) enter into a conservation security
contract with the Secretary to carry out the
conservation security plan.
(2) Eligible land.--
(A) In general.--Except as provided in
subparagraph (C)(iii), private agricultural
land (including cropland, grassland,
prairie land, pasture land, and rangeland)
and land under the jurisdiction of an Indian
tribe shall be eligible for enrollment in the
conservation security program.
(B) Forested land.--Private forested land
shall be eligible for enrollment in the
conservation security program if the forested
land is part of the agricultural land described
in subparagraph (A), including land that is
used for--
(i) alley cropping;
(ii) forest farming;
(iii) forest buffers;
(iv) windbreaks;
(v) silvopasture systems; and
(vi) such other integrated
agroforestry uses as the Secretary may
determine to be appropriate.
(C) Exclusions.--
(i) Conservation reserve program.--
Land enrolled in the conservation
reserve program under subchapter B of
chapter 1 shall not be eligible for
enrollment in the conservation security
program except for land described in
section 1231(b)(6)(A).
(ii) Wetlands reserve program.--Land
enrolled in the wetlands reserve
program established under subchapter C
of chapter 1 shall not be eligible for
enrollment in the conservation security
program.
(iii) Conversion to cropland.--Land
that is used for crop production after
the date of enactment of this
subchapter that had not been in crop
production for at least 3 of the 10
years preceding that date (except for
land enrolled in the conservation
reserve program under subchapter B of
chapter 1) shall not be eligible for
enrollment in the conservation security
program.
(3) Sustainable economic uses.--The Secretary shall
permit a producer to implement, with respect to
eligible land covered by a conservation security plan,
sustainable economic uses (including Tier II
conservation practices) that--
(A) maintain the agricultural nature of the
land; and (B) are consistent with the natural
resource and environmental benefits of the
conservation security plan.
(c) Conservation Security Plans.--
(1) In general.--A conservation security plan shall--
(A) identify the resources and designated
land to be conserved under the conservation
security plan;
(B) describe--
(i) the tier of conservation security
contracts, and the particular
conservation practices to be
implemented, maintained, or improved,
in accordance with subsection (d) on
the land covered by the conservation
security contract for the specified
term; and
(ii) as appropriate for the land
covered by the conservation security
contract, at least, the minimum number
and scope of conservation practices
described in clause (i) that are
required to be carried out on the land
before the producer is eligible to
receive--
(I) a base payment; and
(II) a bonus amount;
(C) contain a schedule for the
implementation, maintenance, or improvement of
the conservation practices described in the
conservation security plan during the term of
the conservation security contract;
(D) meet the highly erodible land and wetland
conservation requirements of subtitles B and C;
and
(E) identify, and authorize the
implementation of, sustainable economic uses
described in subsection (b)(3).
(2) Comprehensive planning.--The Secretary shall
encourage owners and operators that enter into
conservation security contracts--
(A) to undertake a comprehensive examination
of the opportunities for conserving natural
resources and improving the profitability,
environmental health, and quality of life in
relation to their entire agricultural
operation;
(B) to develop a long-term strategy for
implementing, monitoring, and evaluating
conservation practices and environmental
results in the entire agricultural operation;
(C) to participate in other Federal, State,
local, or private conservation programs;
(D) to maintain the agricultural integrity of
the land; and
(E) to adopt innovative conservation
technologies and management practices.
(3) State and local conservation priorities.--
(A) In general.--To the maximum extent
practicable and in a manner consistent with the
conservation security program, each
conservation security plan shall address, at
least, the of conservation priorities of the
State and locality in which the agricultural
operation is located.
(B) Administration.--The conservation
priorities of the State and locality in which
the agricultural operation is located shall
be--
(i) determined by the State
conservationist, in consultation with
the State technical committee
established under subtitle G and the
local subcommittee of the State
technical committee; and
(ii) approved by the Secretary.
(4) Submission of plan.--
(A) In general.--During the development of a
conservation security plan by a producer, at
the request of the producer, the Secretary
shall supply to the producer a statement of the
minimum number, type, and scope of conservation
practices described in paragraph (1)(B)(ii).
(B) Approval for base payments.--If a
conservation security plan submitted to the
Secretary contains, at least, the conservation
practices referred to in paragraph (1)(B)(ii)--
(i) the Secretary shall approve the
conservation security plan; and
(ii) the producer of the conservation
security plan, on approval of and
compliance with the plan, as determined
by the Secretary, shall be eligible to
receive a base payment.
(C) Approval for bonus amounts.--If a
conservation security plan submitted to the
Secretary contains a proposal for the
implementation, maintenance, or improvement of
a conservation practice that qualifies for a
bonus amount under section 1238C(b)(1)(C)(iii),
the Secretary may increase the base payment of
the producer by such bonus amount as the
Secretary determines is appropriate.
(d) Conservation Contracts and Practices.--
(1) In general.--
(A) Establishment of tiers.--The Secretary
shall establish 3 tiers of conservation
contracts under which a payment under this
subchapter may be recieved.
(B) Eligible conservation practices.--
(i) In general.--The Secretary shall
make eligible for payment under a
conservation security contract land
management, vegetative, and structural
practices that--
(I) are necessary to achieve
the purposes of the
conservation security plan; and
(II) primarily provide for,
and have as a primary purpose,
resource protection and
environmental improvement.
(ii) Determination.--
(I) In general.--Subject to
subclause (II), in determining
the eligibility of a practice
described in clause (i), the
Secretary shall require, to the
maximum extent practicable, the
lowest cost alternatives be
used to fulfill the purposes of
the conservation security plan,
as determined by the Secretary.
(II) Innovative
technologies.--Subclause (I)
shall not apply, to the maximum
extent practicable, to the
adoption of innovative
technologies.
(2) On-farm research and demonstration.--With respect
to land enrolled in the conservation security program
that will be maintained using a Tier II conservation
practice or a Tier III conservation practice, the
Secretary may approve a conservation security plan that
includes on-farm conservation research and demonstration
activities, including--
(A) total farm planning;
(B) total resource management;
(C) integrated farming systems;
(D) germplasm conservation and regeneration;
(E) greenhouse gas reduction and carbon
sequestration;
(F) agroecological restoration and wildlife
habitat restoration;
(G) agroforestry;
(H) invasive species control;
(I) energy conservation and management;
(J) farm and environmental results monitoring
and evaluation; or
(K) participation in research projects
relating to water conservation and management
through--
(i) recycling or reuse of water; or
(ii) more efficient irrigation of
farmland.
(3) Use of handbook and guides.--
(A) In general.--In determining eligible
conservation practices under the conservation
security program, the Secretary shall use the
National Handbook of Conservation Practices of
the Natural Resources Conservation Service.
(B) Conservation practice standards.--To the
maximum extent practicable, the Secretary shall
establish guidance standards for implementation
of eligible conservation practices that shall
include measurable goals for enhancing and
preventing degradation of resources.
(C) Adjustments.--
(i) In general.--After providing
notice and an opportunity for public
participation, the Secretary shall make
such adjustments to the National
Handbook of Conservation Practices, and
the field office technical guides, of
the Natural Resources Conservation
Service as are necessary to carry out
this chapter.
(ii) Effect on plan.--If the
Secretary makes an adjustment to a
practice under clause (i), the
Secretary may require an adjustment to
a conservation security plan in effect
as of the date of the adjustment if the
Secretary determines that the plan,
without the adjustment, would
significantly interfere with achieving
the purposes of the conservation
security program.
(D) Pilot testing.--
(i) In general.--Under any of the 3
tiers of conservation practices
established under paragraph (4), the
Secretary may approve requests by a
producer for pilot testing of new
technologies and innovative
conservation practices and systems.
(ii) Incorporation into standards.--
(I) In general.--After
evaluation by the Secretary and
provision of notice and an
opportunity for public
participation, the Secretary
may, as expeditiously as
practicable, approve new
technologies and innovative
conservation practices and
systems.
(II) Incorporation.--If the
Secretary approves a new
technology or innovative
conservation practice under
subclause (I), the Secretary
shall, as expeditiously as
practicable, incorporate the
technology or practice into the
standards for implementation of
conservation practices
established under paragraph
(3).
(4) Tiers.--Subject to paragraph (5), to carry out
this subsection, the Secretary shall establish the
following 3 tiers of conservation contracts:
(A) Tier i conservation contracts.--
(i) In general.--A conservation
security plan for land enrolled in the
conservation security program under a
Tier I conservation security contract
shall be maintained using Tier I
conservation practices and shall, at a
minimum--
(I) if applicable, address at
least 1 resource of concern to
the particular agricultural
operation;
(II) apply to the total
agricultural operation or to a
particular unit of the
agricultural operation;
(III) cover--
(aa) conservation
practices that are
being implemented as of
the date on which the
conservation security
contract is entered
into; and
(bb) conservation
practices that are
implemented after the
date on which the
conservation security
contract is entered
into; and
(IV) meet applicable
standards for implementation of
conservation practices
established under paragraph
(3).
(ii) Conservation practices.--Tier I
conservation practices shall consist
of, as appropriate for the agricultural
operation of a producer, 1 or more of
the following basic conservation
activities:
(I) Soil conservation,
quality, and residue
management.
(II) Invasive species
management.
(III) Fish and wildlife
habitat management, with
special emphasis on species
identified by any natural
heritage program of the
applicable State or the
appropriate State agency.
(IV) Fish and wildlife
conservation and enhancement.
(V) Air quality management.
(VI) Energy conservation
measures.
(VII) Biological resource
conservation and regeneration.
(VIII) Animal health
management.
(IX) Plant and animal
germplasm conservation,
evaluation, and development.
(X) Contour farming.
(XI) Strip cropping.
(XII) Cover cropping.
(XIII) Sediment dams.
(XIV) Nutrient management.
(XV) Integrated pest
management.
(XVI) Irrigation, water
conservation, and water quality
management.
(XVII) Grazing pasture and
rangeland management.
(XVIII) Any other
conservation practice that the
Secretary determines to be
appropriate and comparable to
other conservation practices
described in this clause.
(iii) Tier ii conservation
contracts.--A conservation security
plan for land enrolled in the
conservation security program that will
be maintained using Tier I conservation
contracts may include Tier II
conservation practices.
(B) Tier ii conservation practices.--
(i) In general.--A conservation
security plan for land enrolled in the
conservation security program under a
Tier II conservation security contract
shall be maintained using Tier II
conservation practices and shall, at a
minimum--
(I) address at least 1
resource of concern, as
specified in the conservation
security plan covering the
total agricultural operation;
(II) cover--
(aa) conservation
practices that are
being implemented as of
the date on which the
conservation security
contract is entered
into; and
(bb) conservation
practices that are
implemented after the
date on which the
conservation security
contract is entered
into; and
(III) meet applicable
resource management system
criteria for 1 or more
resources of concern of the
agricultural operation, as
specified in the conservation
security contract.
(ii) Conservation practices.--Tier II
conservation practices shall consist
of, as appropriate for the agricultural
operation of a producer, any of the Tier
I conservation practices and 1 or more of
the following land use adjustment or
protection practices:
(I) Resource-conserving crop
rotations.
(II) Controlled, rotational
grazing.
(III) Conversion of portions
of cropland from a soil-
depleting use to a soil-
conserving use, including
production of cover crops.
(IV) Partial field
conservation practices
(including windbreaks, grass
waterways, shelter belts,
filter strips, riparian
buffers, wetland buffers,
contour buffer strips, living
snow fences, crosswind trap
strips, field borders, grass
terraces, wildlife corridors,
and critical area planting
appropriate to the agricultural
operation).
(V) Fish and wildlife habitat
conservation and restoration.
(VI) Native grassland and
prairie protection and
restoration.
(VII) Wetland protection and
restoration.
(VIII) Agroforestry practices
and systems.
(IX) Any other conservation
practice involving modification
of the use of land that the
Secretary determines to be
appropriate and comparable to
other conservation practices
described in this clause.
(C) Tier iii conservation contracts.--
(i) In general.--A conservation
security plan for land enrolled in the
conservation security program under a
Tier III conservation security contract
shall be maintained using Tier III
conservation contracts and shall, at a
minimum--
(I) address all applicable
resources of concern in the
total agricultural operation;
(II) cover--
(aa) conservation
practices that are
being implemented as of
the date on which the
conservation security
contract is entered
into; and
(bb) conservation
practices that are
implemented after the
date on which the
conservation security
contract is entered
into; and
(III) meet applicable
resource management system
criteria for 1 or more
resources of concern of the
agricultural operation, as
specified in the conservation
security contract.
(ii) Conservation practices.--Tier
III conservation practices shall
consist of, as appropriate for the
agricultural operation of a producer
(in addition to appropriate Tier I
conservation practices and Tier II
conservation practices), development,
implementation, and maintenance of a
conservation security plan that, over
the term of the conservation security
contract--
(I) integrates all necessary
conservation practices to
foster environmental
enhancement and the long-term
sustainability of the natural
resource base of an
agricultural operation; and
(II) improves profitability
and sustainability associated
with the agricultural
operation.
(5) Minimum requirements.--The minimum requirements
for each tier of conservation practices described in
paragraph (4) shall be--
(i) determined by the State conservationist,
in consultation with the State technical
committee established under subtitle G and the
local subcommittee of the State technical
committee; and
(ii) approved by the Secretary.
(e) Conservation Security Contracts.--
(1) Contracts.--
(A) In general.--On approval of a
conservation security plan of a producer, the
Secretary shall enter into a conservation
security contract with the producer to enroll
the land covered by the conservation security
plan in the conservation security program.
(B) Required components.--A conservation
security contract shall specifically describe
the practices that are required under
subsection (c)(1)(B).
(2) Term.--Subject to paragraphs (3) and (4)--
(A) a conservation security contract for land
enrolled in the conservation security program
of a producer that will be maintained using 1
or more Tier I conservation practices shall
have a term of 5 years; and
(B) a conservation security contract for land
enrolled in the conservation security program
that will be maintained using a Tier II
conservation practice or Tier III conservation
practice shall have a 5-year to 10-year term,
as determined by the producer.
(3) Modifications.--
(A) Optional modifications.--
(i) In general.--An owner or operator
may apply to the Secretary to modify
the conservation security plan to
effectuate the purposes of the
conservation security program.
(ii) Approval by the secretary.--To
be effective, any modification under
clause (i)--
(I) shall be approved by the
Secretary; and
(II) shall authorize the
Secretary to redetermine, if
necessary, the amount and
timing of the payments under
the conservation security
contract and subsections (a)
and (b) of section 1238C.
(B) Other modifications.--
(i) In general.--The Secretary may,
in writing, require a producer to
modify a conservation security contract
before the expiration of the
conservation security contract if--
(I) the Secretary determines
that a change made to the type,
size, management, or other
aspect of the agricultural
operation of the producer
would, without the modification
of the contract, significantly
interfere with achieving the
purposes of the conservation
security program; or
(II) the Secretary makes a
change to the National Handbook
of Conservation Practices of
the Natural Resource
Conservation Service under
subsection (d)(3)(C).
(ii) Payments.--The Secretary may
adjust the amount and timing of the
payment schedule under the conservation
security contract to reflect any
modifications made under this
subparagraph.
(iii) Deadline.--The Secretary may
terminate a conservation security
contract if a modification required
under this subparagraph is not
submitted to the Secretary in the form
of an amended conservation security
contract by the date that is 90 days
after the date on which the Secretary
issues a written request for the
modification.
(iv) Termination.--a producer that is
required to modify a conservation
security contract under this
subparagraph may, in lieu of modifying
the contract--
(I) terminate the
conservation security contract;
and
(II) retain payments received
under the conservation security
contract, if the producer fully
complied with the terms and
conditions of the conservation
security contract before
termination of the contract.
(4) Renewal.--
(A) In general.--At the option of a producer,
the conservation security contract of the
producer may be renewed, for a term described
in subparagraph (B), if--
(i) the producer agrees to any
modification of the applicable
conservation security contract that the
Secretary determines to be necessary to
achieve the purposes of the
conservation security program;
(ii) the Secretary determines that
the producer has complied with the
terms and conditions of the
conservation security contract,
including the conservation security
plan; and
(iii) in the case of a Tier I
conservation security contract, the
producer agrees to increase the
conservation practices on land enrolled
in the conservation security program
by--
(I) adopting new conservation
practices; or
(II) expanding existing
practices to meet the resource
management systems criteria.
(B) Terms of renewal.--Under subparagraph
(A)--
(i) a conservation security contract
for land enrolled in the conservation
security program that will be
maintained using Tier I conservation
contracts may be renewed for 5-year
terms;
(ii) in the case of a Tier II
conservation security contract or a
Tier III conservation security
contract, the contract shall be renewed
for 5-year to 10-year terms, at the
option of the producer; and
(iii) participation in the
conservation security program prior to
the renewal of the conservation
security contract shall not bar renewal
more than once.
(f) Noncompliance Due to Circumstances Beyond the Control
of Producers.--The Secretary shall include in the conservation
security contract a provision, and may modify a conservation
security contract under subsection (e)(3)(B), to ensure that a
producer shall not be considered in violation of a conservation
security contract for failure to comply with the conservation
security contract due to circumstances beyond the control of
the producer, including a disaster or related condition, as
determined by the Secretary.
SEC. 1238B. DUTIES OF PRODUCERS.
Under a conservation security contract, a producer shall
agree, during the term of the conservation security contract--
(1) to implement the applicable conservation security
plan approved by the Secretary;
(2) to maintain, and make available to the Secretary
at such times as the Secretary may request, appropriate
records showing the effective and timely implementation
of the conservation security plan;
(3) not to engage in any activity that would
interfere with the purposes of the conservation
security plan; and
(4) on the violation of a term or condition of the
conservation security contract--
(A) if the Secretary determines that the
violation warrants termination of the
conservation security contract--
(i) to forfeit all rights to receive
payments under the conservation
security contract; and
(ii) to refund to the Secretary all
or a portion of the payments received
by the producer under the conservation
security contract, including any
advance payment and interest on the
payments, as determined by the
Secretary; or
(B) if the Secretary determines that the
violation does not warrant termination of the
conservation security contract, to refund to
the Secretary, or accept adjustments to, the
payments provided to the producer, as the
Secretary determines to be appropriate.
SEC. 1238C. DUTIES OF THE SECRETARY.
(a) Advance Payment.--At the time at which a producer
enters into a conservation security contract, the Secretary
shall, at the option of the producer, make an advance payment
to the producer in an amount not to exceed--
(1) in the case of a Tier I conservation security
contract, the greater of--
(A) $1,000; or
(B) 20 percent of the value of the annual
payment under the contract, as determined by
the Secretary;
(2) in the case of a Tier II conservation security
contract, the greater of--
(A) $2,000; or
(B) 20 percent of the value of the annual
payment under the contract, as determined by
the Secretary; and
(3) in the case of a Tier III conservation security
contract, the greater of--
(A) $3,000; or
(B) 20 percent of the value of the annual
payment under the contract, as determined by
the Secretary.
(b) Annual Payments.--
(1) Criteria for determining amount of payments.--
(A) Base rate.--In this paragraph, the term
`base rate' means the average county rental
rate for the specific land use during the 2001
crop year, or another appropriate average
county rate for the 2001 crop year, that
ensures regional equity, as determined by the
Secretary.
(B) Payments.--A payment for a conservation
practice under this paragraph shall be
determined in accordance with subparagraphs (C)
through (F).
(C) Tier i conservation contracts.--The
payment for a Tier I conservation security
contract shall be comprised of the total of the
following amounts:
(i) An amount equal to 6 percent of
the base rate for land covered by the
contract.
(ii) An amount equal to the following
costs of practices covered by the
conservation security contract, based
on the average county costs for such
practices for the 2001 crop year, as
determined by the Secretary:
(I) 100 percent of the cost
of--
(aa) the adoption of
new management
practices; and
(bb) the maintenance
of new and existing
management practices.
(II) 100 percent of the cost
of maintenance of existing
land-based structural practices
approved by the Secretary.
(III)(aa) 75 percent (or, in
the case of a limited resource
producer (as determined by the
Secretary) or a beginning
farmer or rancher, 90 percent)
of the cost of adoption of new
land-based structural
practices; or
(bb) 75 percent (or, in the
case of a limited resource
producer (as determined by the
Secretary) or a beginning
farmer or rancher, 90 percent)
of the cost of the adoption of
a structural practice for which
a similar structural practice
under the environmental quality
incentives program established
under chapter 4 would require
maintenance, if the producer
agrees to provide, without
reimbursement, substantially
equivalent maintenance.
(iii) A bonus amount determined by
the Secretary for implementing or
adopting 1 or more of the following
practices:
(I) A practice adopted or
maintained that maximizes the
purposes of the conservation
security program beyond the
minimum requirements of the
practices adopted or
maintained.
(II) A practice adopted or
maintained to address eligible
resource and conservation
concerns beyond those
identified as State or local
conservation priorities.
(III) A practice adopted or
maintained to address national
priority concerns, as
determined by the Secretary.
(IV) Participation by the
producer in a conservation
research, demonstration, or
pilot project.
(V) Participation by the
producer in a watershed or
regional resource conservation
plan that involves at least 75
percent of producers in a
targeted area.
(VI) Recordkeeping,
monitoring, and evaluation
carried out by the producer
that furthers the purposes of
the conservation security
program.
(iv) A bonus amount determined by the
Secretary that reflects the status of a
producer as a beginning farmer or
rancher.
(D) Tier ii conservation contracts.--The
payment for a Tier II conservation security
contract shall be comprised of the total of the
following amounts:
(i) An amount equal to 11 percent of
the base rate for land covered by the
conservation security contract.
(ii) An amount equal to the cost of
practices covered by the conservation
security contract, based on the average
county costs for practices for the 2001
crop year, described in subparagraph
(C)(ii).
(iii) A bonus amount determined by
the Secretary in accordance with
clauses (iii) and (iv) of subparagraph
(C), except that the bonus amount under
this clause may include any amount for
the adoption or maintenance by the
producer of any practice that exeeds
resource management system standards.
(E) Tier iii conservation contracts.--The
payment for a Tier III conservation security
contract shall be comprised of the total of the
following amounts:
(i) An amount equal to 20 percent of
the base rate for land covered by the
conservation security contract.
(ii) An amount equal to the cost of
practices covered by the conservation
security contract, based on the average
county costs for practices for the 2001
crop year, described in subparagraph
(C)(ii).
(iii) A bonus amount determined by
the Secretary in accordance with
subparagraph (D)(iii).
(F) Exclusion of costs for purchase or
maintenance of equipment or non-land based
structures.--A payment under this subchapter
shall not include any amount for the purchase
or maintenance of equipment or a non-land based
structure.
(2) Time of payment.--The Secretary shall provide
payments under a conservation security contract as soon
as practicable after October 1 of each fiscal year.
(3) Limitation on payments.--
(A) In general.--Subject to paragraphs (1),
(2), (4), and (5), the Secretary shall, in
amounts and for a term specified in a
conservation security contract and taking into
account any advance payments, make an annual
payment, directly or indirectly, to the
individual or entity covered by the
conservation security contract in an amount not
to exceed--
(i) in the case of a Tier I
conservation security contract,
$20,000;
(ii) in the case of a Tier II
conservation security contract,
$35,000; or
(iii) in the case of a Tier III
conservation security contract,
$50,000.
(B) Limitation on nonbonus payments.--In
applying the payment limitation under each of
clauses (i), (ii), and (iii) of subparagraph
(A), an individual or entity may not receive,
directly or indirectly, payments described in
clauses (i) and (ii) of paragraph (1)(C),
(1)(D), or (1)(E), as appropriate, in an amount
that exceeds 75 percent of the applicable
payment limitation.
(C) Other usda payments.--If a producer has
the same practices on the same land enrolled in
the conservation security program and 1 or more
other conservation programs administered by the
Secretary, the Secretary shall include all
payments from the conservation security program
and the other conservation programs, other than
payments for conservation easements, in
applying the annual payment limitations under
this paragraph.
(D) Non-usda payments.--
(i) In general.--A payment described
in clause (ii) shall not be considered
an annual payment for purposes of the
annual payment limitations under this
paragraph.
(ii) Payment.--A payment referred to
in clause (i) is a payment that--
(I) is for the same practice
on the same land enrolled in
the conservation security
program; and
(II) is received from a
Federal program that is not
administered by the Secretary,
or that is administered by any
State, local, or private
agricultural agency or
organization.
(E) Commensurate share.--To be eligible to
receive a payment under this chapter, an
individual or entity shall make contributions
(including contributions of land, labor,
management, equipment, or capital) to the
operation of the farm that are at least
commensurate with the share of the proceeds of
the operation of the individual or entity.
(4) Land enrolled in other conservation programs.--
Notwithstanding any other provision of law, if a
producer has land enrolled in another conservation
program administered by the Secretary and has applied
to enroll the same land in the conservation security
program, the producer may elect to--
(A) convert the contract under the other
conservation program to a conservation security
contract, without penalty, except that this
subparagraph shall not apply to a contract
entered into under--
(i) the conservation reserve program
under subchapter B ofchapter 1; or
(ii) the wetlands reserve program
under subchapter C of chapter 1; or
(B) have each annual payment to the producer
under this subsection reduced to reflect
payment for practices the producer receives
under the other conservation program, except
that the annual payment under this subsection
shall not be reduced by the amount of any
incentive received under a program referred to
in section 1231(b)(6) for qualified practices
that enhance or extend the conservation benefit
achieved under the other conservation program.
(5) Waste storage or treatment facilities.--A payment
to a producer under this subchapter shall not be
provided for the purpose of construction or maintenance
of animal waste storage or treatment facilities or
associated waste transport or transfer devices for
animal feeding operations.
(c) Minimum Practice Requirement.--In determining a payment
under subsection (a) or (b) for an owner, operator, or producer
that receives a payment under another program administered by
the Secretary that is contingent on complying with requirements
under subtitle B or C of title XII of the Food Security Act of
1985 (16 U.S.C. 3811 et seq.) relating to the use of highly
erodible land or wetland, a payment under this chapter for 1 or
more practices on land subject to those requirements shall be
for practices that exceed minimum requirements for the owner,
operator, or producer under those subtitles, as determined by
the Secretary.
(d) Regulations.--
(1) In general.--The Secretary shall promulgate
regulations that--
(A) provide for adequate safeguards to
protect the interests of tenants and
sharecroppers, including provision for sharing
payments, on a fair and equitable basis; and
(B) prescribe such other rules as the
Secretary determines to be necessary to ensure
a fair and reasonable application of the
limitations established under subsections (a)
and (b).
(2) Penalties for schemes or devices.--
(A) In general.--If the Secretary determines
that an individual or entity has adopted a
scheme or device to evade, or that has the
purpose of evading, the regulations promulgated
under paragraph (1), the individual or entity
shall be ineligible to participate in the
conservation security program for--
(i) the year for which the scheme or
device was adopted; and
(ii) each of the following 5 years.
(B) Fraud.--If the Secretary determines that
fraud was committed in connection with the
scheme or device, the individual or entity
shall be ineligible to participate in the
conservation security program for--
(i) the year for which the scheme or
device was adopted; and
(ii) each of the following 10 years.
(e) Termination.--
(1) In general.--Subject to section 1238B, the
Secretary shall allow a producer to terminate the
conservation security contract.
(2) Payments.--the producer may retain any or all
payments received under a terminated conservation
security contract if--
(A) the producer is in full compliance with
the terms and conditions (including any
maintenance requirements) of the conservation
security contract as of the date of the
termination; and
(B) the Secretary determines that termination
of the contract will not defeat the purposes of
the conservation security plan of the producer.
(f) Transfer or Change of Interest in Land Subject to
Conservation Security Contract.--
(1) In general.--Except as provided in paragraph (2),
the transfer, or change in the interest, of a producer
in land subject to a conservation security contract
shall result in the termination of the conservation
security contract.
(2) Transfer of duties and rights.--Paragraph (1)
shall not apply if, not later than 60 days after the
date of the transfer or change in the interest in land,
the transferee of the land provides written notice to
the Secretary that all duties and rights under the
conservation security contract have been transferred
to the transferee.
(g) Technical Assistance.--
(1) In general.--For each of fiscal years 2003
through 2006, the Secretary shall provide technical
assistance to producers for the development and
implementation of conservation security contracts, in
an amount not to exceed 20 percent of amounts expended
for the fiscal year.
(2) Coordination by the secretary.--The Secretary
shall provide overall technical coordination and
leadership for the conservation security program,
including final approval of all conservation security
plans.
(h) Conservation Security Pilot Program.--
(1) In general.--Effective October 1, 2004, the
Secretary, in cooperation with appropriate State
agencies, may establish a pilot program to demonstrate
and evaluate the implementation of a conservation
security program by a State described in paragraph (2).
(2) Eligible state.--The State referred to in
paragraph (1) shall be a State selected by the
Secretary--
(A) in consultation with--
(i) the Committee on Agriculture of
the House of Representatives; and
(ii) the Committee on Agriculture,
Nutrition, and Forestry of the Senate;
and
(B) after taking into consideration--
(i) the percentage of private land in
agricultural production in the State;
and
(ii) infrastructure in the State that
is available to implement the pilot
program under paragraph (1).
Subchapter B--Farmland Protection Program
SEC. 1238H. DEFINITIONS.
In this subchapter:
(1) Eligible land.--
(A) In general.--The term ``eligible land''
means land on a farm or ranch that--
(i)(I) has prime, unique, or other
productive soil; or (II) contains
historical or archaeological resources;
and
(ii) is subject to a pending offer
for purchase from--
(I) any agency of any State
or local government or an
Indian tribe (including a
farmland protection board or
land resource council
established under State law);
or
(II) any organization that--
(aa) is organized
for, and at all times
since the formation of
the organization, has
been operated
principally for, 1 or
more of the
conservation purposes
specified in clause
(i), (ii), or (iii) of
section 170(h)(4)(A) of
the Internal Revenue
Code of 1986;
(bb) is an
organization described
in section 501(c)(3) of
that Code that is
exempt from taxation
under section 501(a) of
that Code; or
(cc) is described in
section 509(a)(3), and
is controlled by an
organization described
in section 509(a)(2),
of that Code.
(B) Inclusions.--The term ``eligible land''
includes--
(i) cropland;
(ii) rangeland;
(iii) grassland:
(iv) pasture land; and
(v) forest land that is part of an
agricultural operation, as determined
by the Secretary.
(2) Indian tribe.--The term ``Indian tribe'' has the
meaning given the term in section 4 of the Indian Self-
Determination and Education Assistance Act (25 U.S.C.
450b).
(3) Program.--The term ``program'' means the farmland
protection program established under section 1238I(a).
SEC. 1238I. FARMLAND PROTECTION.
(a) In General.--The Secretary shall establish and carry
out a farmland protection program under which the Secretary
shall purchase conservation easements or other interests in
eligible land for the purpose of protecting topsoil by limiting
nonagricultural uses of the land.
(b) Conservation Plan.--Any highly erodible cropland for
which a conservation easement or other interest is purchased
under this subchapter shall be subject to the requirements of a
conservation plan that requires, at the option of the
Secretary, the conversion of the cropland to less intensive
uses.
SEC. 1238J. MARKET VIABILITY PROGRAM.
For each year for which funds are made available to carry
out this subchapter, the Secretary may use not more than
$10,000,000 to provide matching market viability grants and
technical assistance to farm and ranch operators that
participate in the program.
Subchapter D--Grassland Reserve Program
SEC. 1238N. GRASSLAND RESERVE PROGRAM.
(a) Establishment.--The Secretary, acting through the
Natural Resource Conservation Service, shall establish a
grassland reserve program (referred to in this subchapter as
the ``program'') to assist owners in restoring and protecting
eligible land described in subsection (c).
(b) Enrollment Conditions.--
(1) In general.--The Secretary shall enroll in the
program, from willing owners, not less than--
(A) 100 contiguous acres of land west of the
98th meridian; or
(B) 40 contiguous acres of land east of the
98th meridian.
(2) Maximum enrollment.--The total number of acres
enrolled in the program shall not exceed 2,000,000
acres, of which not more than 500,00 acres shall be
reserved for enrollment of tracts of native grassland
of 40 acres or less.
(3) Methods of enrollment.--The Secretary shall
enroll land in the program through--
(A) permanent easements or 30-year easements;
(B) in a State that imposes a maximum
duration for such an easement, an easement for
the maximum duration allowed under State law;
or
(C) a 30-year rental agreement.
(c) Eligible Land.--Land shall be eligible to be enrolled
in the program if the Secretary determines that the land is
private land that is--
(1) natural grassland (including prairie and land
that contains shrubs or forb) that is indigenous to the
locality;
(2) land that--
(A) is located in an area that has been
historically dominated by natural grassland;
and
(B) has potential to serve as habitat for
animal or plant populations of significant
ecological value if the land is restored to a
natural condition; or
(3) land that is incidental to land described in
paragraph (1) or (2), if the incidental land is
determined by the Secretary to be necessary for the
efficient administration of an easement.
SEC. 1238O. EASEMENTS AND AGREEMENTS.
(a) In General.--To be eligible to enroll land in the
program, the owner of the land shall enter into an agreement
with the Secretary--
(1) to grant an easement that applies to the land to
the Secretary;
(2) to create and record an appropriate deed
restriction in accordance with applicable State law to
reflect the easement;
(3) to provide a written statement of consent to
the easement signed by persons holding a security interest
or any vested interest in the land;
(4) to provide proof of unencumbered title to the
underlying fee interest in the land that is the subject
of the easement; and
(5) to comply with the terms of the easement and
restoration agreement.
(b) Terms of Easement.--An easement under subsection (a)
shall--
(1) permit--
(A) grazing on the land in a manner that is
consistent with maintaining the viability of
natural grass, shrub, forb, and wildlife
species indigenous to that locality;
(B) haying (including haying for seed
production) or mowing, except during the
nesting and brood-rearing seasons for birds in
the area that are in significant decline, as
determined by the Natural Resources
Conservation Service State conservationist, or
are protected Federal or State law; and
(C) fire rehabilitation, construction of fire
breaks, and fences (including placement of the
posts necessary for fences);
(2) prohibit--
(A) the production of row crops, fruit trees,
vineyards, or any other agricultural commodity
that requires breaking the soil surface; and
(B) except as permitted under paragraph
(1)(C), the conduct of any other activities
that would disturb the surface of the land
covered by the easement, including--
(i) plowing; and
(ii) disking; and
(3) include such additional provisions as the
Secretary determines are appropriate to carry out this
subchapter or to facilitate the administration of this
subchapter.
(c) Evaluation and Ranking of Easement Applications.--
(1) In general.--The Secretary, in conjunction with
State technical committees, shall establish criteria to
evaluate and rank applications for easements under this
subchapter.
(2) Criteria.--In establishing the criteria, the
Secretary shall emphasize support for grazing
operations, plant and animal biodiversity, and
grassland and land containing shrubs or forb under the
greatest threat of conversion.
(d) Restoration Agreements.--
(1) In general.--The Secretary shall prescribe the
terms by which grassland and shrubland subject to an
easement under an agreement entered into under the
program shall be restored.
(2) Requirements.--The restoration agreement shall
describe the respective duties of the owner and the
Secretary (including paying the share of the cost of
restoration provided by the Secretary and the provision
of technical assistance).
(e) Violations.--
(1) In general.--On the violation of the terms or
conditions of an easement or restoration agreement
entered into under this section--
(A) the easement shall remain in force; and
(B) the Secretary may require the owner to
refund all or part of any payments received by
the owner under this subchapter, with interest
on the payments as determined appropriate by
the Secretary.
(2) Periodic inspections.--
(A) In general.--After providing notice to
the owner, the Secretary shall conduct periodic
inspections of land subject to easements under
this subchapter to ensure compliance with the
terms of the easement and restoration
agreement.
(B) Limitation.--The Secretary may not
prohibit the owner, or a representative of the
owner, from being present during a periodic
inspection.
SEC. 1238P. DUTIES OF SECRETARY.
(a) In General.--In return for the granting of an easement
byan owner under this subchapter, the Secretary shall, in
accordance with this section--
(1) make easement payments;
(2) pay a share of the cost of restoration; and
(3) provide technical assistance to the owner.
(b) Payment Schedule.--
(1) Easement payments.--
(A) Amount.--In return for the granting of an
easement by an owner under this subchapter, the
Secretary shall make easement payments to the
owner in an amount equal to--
(i) in the case of a permanent
easement, the fair market value of the
land less the grazing value of the land
encumbered by the easement; and
(ii) in the case of a 30-year
easement or an easement for the maximum
duration allowed under applicable State
law, 30 percent of the fair market
value of the land less the grazing
value of the land for the period during
which the land is encumbered by the
easement.
(B) Schedule.--Easement payments may be
provided in not less than 1 payment nor more
than 10 annual payments of equal or unequal
amount, as agreed to by the Secretary and the
owner.
(2) Rental agreement payments.--
(A) Amount.--If an owner enters into a 30-
year rental agreement authorized under section
1238N(b)(3)(C), the Secretary shall make 30
annual rental payments to the owner in an
amount that equals, to the maximum extent
practicable, the 30-year easement payment
amount under paragraph (1)(A)(ii).
(B) Assessment.--Not less than once every 5
years throughout the 30-year rental period, the
Secretary shall assess whether the value of the
rental payments under subparagraph (A) equals,
to the maximum extent practicable, the total
amount of 30-year easement payments as of the
date of the assessment.
(C) Adjustment.--If on completion of the
assessment under subparagraph (B), the
Secretary determines that the rental payments
do not equal, to the maximum extent
practicable, the value of payments under a 30-
year easement, the Secretary shall adjust the
amount of the remaining payments to equal, to
the maximum extent practicable, the value of a
30-year easement over the entire 30-year rental
period.
(c) Cost of Restoration.--The Secretary shall make payments
to the owner of not more than 75 percent of the cost of
carrying out measures and practices necessary to restore
grassland and shrubland functions and values.
(d) Technical Assistance.--The Secretary shall provide
owners with technical assistance to execute easement documents
and restore the grassland and shrubland.
(e) Payments to Others.--If an owner that is entitled to a
payment under this subchapter dies, becomes incompetent, is
otherwise unable to receive the payment, or is succeeded by
another person who renders or completes the required
performance, the Secretary shall make the payment, in
accordance with regulations promulgated by the Secretary and
without regard to any other provision of law, in such manner as
the Secretary determines is fair and reasonable in light of all
the circumstances.
(f) Other Payments.--Easement payments received by an owner
under this subchapter shall be in addition to, and not affect,
the total amount of payments that the owner is otherwise
eligible to receive under other Federal laws.
(g) Regulations.--Not later than 180 days after the date of
enactment of this subchapter, the Secretary shall promulgate
such regulations as are necessary to carry out this
subchapter.''.
(b) Funding.--Section 1241 of the Food Security Act of 1985
(16 U.S.C. 3841) (as amended by section 217(b)) is amended by
adding at the end the following:
(e) Grassland Reserve Program.--The Secretary shall use
such sums of the Commodity Credit Corporation as are necessary
to carry out subchapter D of chapter 2 (including the provision
of technical assistance).
* * * * * * *
[SEC. 1240. PURPOSES.
[The purposes of the environmental quality incentives
program established by this chapter are to--
[(1) combine into a single program the functions of--
[(A) the agricultural conservation program
authorized by sections 7 and 8 of the Soil
Conservation and Domestic Allotment Act (16
U.S.C. 590g and 590h) (as in effect before the
amendments made by section 336(a)(1) of the
Federal Agriculture Improvement and Reform Act
of 1996);
[(B) the Great Plains conservation program
established under section 16(b) of the Soil
Conservation and Domestic Allotment Act (16
U.S.C. 590p(b)) (as in effect before the
amendment made by section 336(b)(1) of the
Federal Agriculture Improvement and Reform Act
of 1996);
[(C) the water quality incentives program
established under chapter 2 (as in effect
before the amendment made by section 336(h) of
the Federal Agriculture Improvement and Reform
Act of 1996); and
[(D) the Colorado River Basin salinity
control program established under section
202(c) of the Colorado River Basin Salinity
Control Act (43 U.S.C. 1592(c)) (as in effect
before the amendment made by section 336(c)(1)
of the Federal Agriculture Improvement and
Reform Act of 1996); and
[(2) carry out the single program in a manner that
maximizes environmental benefits per dollar expended,
and that provides--
[(A) flexible technical and financial
assistance to farmers and ranchers that face
the most serious threats to soil, water, and
related natural resources, including grazing
lands, wetlands, and wildlife habitat;
[(B) assistance to farmers and ranchers in
complying with this title and Federal and State
environmental laws, and encourages
environmental enhancement;
[(C) assistance to farmers and ranchers in
making beneficial, cost-effective changes to
cropping systems, grazing management, manure,
nutrient, pest, or irrigation management, land
uses, or other measures needed to conserve and
improve soil, water, and related natural
resources; and
[(D) for the consolidation and simplification
of the conservation planning process to reduce
administrative burdens on producers.
[SEC. 1240A. DEFINITIONS.
[In this chapter:
[(1) Eligible land.--The term ``eligible land'' means
agricultural land (including cropland, rangeland,
pasture, and other land on which crops or livestock are
produced), including agricultural land that the
Secretary determines poses a serious threat to soil,
water, or related resources by reason of the soil
types, terrain, climatic, soil, topographic, flood, or
saline characteristics, or other factors or natural
hazards.
[(2) Land management practice.--The term ``land
management practice'' means a site-specific nutrient or
manure management, integrated pest management,
irrigation management, tillage or residue management,
grazing management, or other land management practice
carried out on eligible land that the Secretary
determines is needed to protect, in the most cost-
effective manner, water, soil, or related resources
from degradation.
[(3) Livestock.--The term ``livestock'' means dairy
cattle, beef cattle, laying hens, broilers, turkeys,
swine, sheep, and such other animals as determined by
the Secretary.
[(4) Producer.--The term ``producer'' means a person
who is engaged in livestock or agricultural production
(as defined by the Secretary).
[(5) Structural practice.--The term ``structural
practice'' means--
[(A) the establishment on eligible land of a
site-specific animal waste management facility,
terrace, grassed waterway, contour grass strip,
filterstrip, tailwater pit, permanent wildlife
habitat, or other structural practice that the
Secretary determines is needed to protect, in
the most cost-effective manner, water, soil, or
related resources from degradation; and
[(B) the capping of abandoned wells on
eligible land.
[SEC. 1240B. ESTABLISHMENT AND ADMINISTRATION OF ENVIRONMENTAL QUALITY
INCENTIVES PROGRAM.
[(a) Establishment.--
[(1) In general.--During the 1996 through 2002 fiscal
years, the Secretary shall provide technical
assistance, cost-share payments, incentive payments,
and education to producers, who enter into contracts
with the Secretary, through an environmental quality
incentives program in accordance with this chapter.
[(2) Eligible practices.--
[(A) Structural practices.--A producer who
implements a structural practice shall be
eligible for any combination of technical
assistance, cost-share payments, and education.
[(B) Land management practices.--A producer
who performs a land management practice shall
be eligible for any combination of technical
assistance, incentive payments, and education.
[(b) Application and Term.--A contract between a producer
and the Secretary under this chapter may--
[(1) apply to 1 or more structural practices or 1 or
more land management practices, or both; and
[(2) have a term of not less than 5, nor more than
10, years, as determined appropriate by the Secretary,
depending on the practice or practices that are the
basis of the contract.
[(c) Structural Practices.--
[(1) Offer selection process.--The Secretary shall,
to the maximum extent practicable, establish a process
for selecting applications for financial assistance if
there are numerous applications for assistance for
structural practices that would provide substantially
the same level of environmental benefits. The process
shall be based on--
[(A) a reasonable estimate of the projected
cost of the proposals and other factors
identified by the Secretary for determining
which applications will result in the least
cost to the program authorized by this chapter;
and
[(B) the priorities established under this
subtitle and such other factors determined by
the Secretary that maximize environmental
benefits per dollar expended.
[(2) Concurrence of owner.--If the producer making an
offer to implement a structural practice is a tenant of
the land involved in agricultural production, for the
offer to be acceptable, the producer shall obtain the
concurrence of the owner of the land with respect to
the offer.
[(d) Land Management Practices.--The Secretary shall
establish an application and evaluation process for awarding
technical assistance or incentive payments, or both, to a
producer in exchange for the performance of 1 or more land
management practices by the producer.
[(e) Cost-Share Payments, Incentive Payments, and Technical
Assistance.--
[(1) Cost-share payments.--
[(A) In general.--The Federal share of cost-
share payments to a producer proposing to
implement 1 or more structural practices shall
be not more than 75 percent of the projected
cost of the practice, as determined by the
Secretary, taking into consideration any
payment received by the producer from a State
or local government.
[(B) Limitation.--A producer who owns or
operates a large confined livestock operation
(as defined by the Secretary) shall not be
eligible for cost-share payments to construct
an animal waste management facility.
[(C) Other payments.--A producer shall not be
eligible for cost-share payments for structural
practices on eligible land under this chapter
if the producer receives cost-share payments or
other benefits for the same land under chapter
1 or 3.
[(2) Incentive payments.--The Secretary shall make
incentive payments in an amount and at a rate
determined by the Secretary to be necessary to
encourage a producer to perform 1 or more land
management practices.
[(3) Technical assistance.--
[(A) Funding.--The Secretary shall allocate
funding under this chapter for the provision of
technical assistance according to the purpose
and projected cost for which the technical
assistance is provided for a fiscal year. The
allocated amount may vary according to the type
of expertise required, quantity of time
involved, and other factors as determined
appropriate by the Secretary. Funding shall not
exceed the projected cost to the Secretary of
the technical assistance provided for a fiscal
year.
[(B) Other authorities.--The receipt of
technical assistance under this chapter shall
not affect the eligibility of the producer to
receive technical assistance under other
authorities of law available to the Secretary.
[(C) Private sources.--The Secretary shall
ensure that the processes of writing and
developing proposals and plans for contracts
under this chapter, and of assisting in the
implementation of structural practices and land
management practices covered by the contracts,
are open to individuals in agribusiness,
including agricultural producers,
representatives from agricultural cooperatives,
agricultural input retail dealers, and
certified crop advisers. The requirements of
this subparagraph shall also apply to any other
conservation program of the Department of
Agriculture that provides incentive payments,
technical assistance, or cost-share payments.
[(f) Modification or Termination of Contracts.--
[(1) Voluntary modification or termination.--The
Secretary may modify or terminate a contract entered
into with a producer under this chapter if--
[(A) the producer agrees to the modification
or termination; and
[(B) the Secretary determines that the
modification or termination is in the public
interest.
[(2) Involuntary termination.--The Secretary may
terminate a contract under this chapter if the
Secretary determines that the producer violated the
contract.
[(g) Non-Federal Assistance.--The Secretary may request the
services of a State water quality agency, State fish and
wildlife agency, State forestry agency, or any other
governmental or private resource considered appropriate to
assist in providing the technical assistance necessary for the
development and implementation of a structural practice or land
management practice.
[SEC. 1240C. EVALUATION OF OFFERS AND PAYMENTS.
[In providing technical assistance, cost-share payments,
and incentive payments to producers, the Secretary shall accord
a higher priority to assistance and payments that--
[(1) are provided in conservation priority areas
established under section 1230(c);
[(2) maximize environmental benefits per dollar
expended; or
[(3) are provided in watersheds, regions, or
conservation priority areas in which State or local
governments have provided, or will provide, financial
or technical assistance to producers for the same
conservation or environmental purposes.
[SEC. 1240D. DUTIES OF PRODUCERS.
[To receive technical assistance, cost-share payments, or
incentive payments under this chapter, a producer shall agree--
[(1) to implement an environmental quality incentives
program plan that describes conservation and
environmental goals to be achieved through a structural
practice or land management practice, or both, that is
approved by the Secretary;
[(2) not to conduct any practices on the farm or
ranch that would tend to defeat the purposes of this
chapter;
[(3) on the violation of a term or condition of the
contract at any time the producer has control of the
land, to refund any cost-share or incentive payment
received with interest, and forfeit any future payments
under this chapter, as determined by the Secretary;
[(4) on the transfer of the right and interest of the
producer in land subject to the contract, unless the
transferee of the right and interest agrees with the
Secretary to assume all obligations of the contract, to
refund all cost-share payments and incentive payments
received under this chapter, as determined by the
Secretary;
[(5) to supply information as required by the
Secretary to determine compliance with the
environmental quality incentives program plan and
requirements of the program; and
[(6) to comply with such additional provisions as the
Secretary determines are necessary to carry out the
environmental quality incentives program plan.
[SEC. 1240E. ENVIRONMENTAL QUALITY INCENTIVES PROGRAM PLAN.
[(a) In General.--To be eligible to enter into a contract
under the environmental quality incentives program, an owner or
producer of a livestock or agricultural operation must submit
to the Secretary for approval a plan of operations that
incorporates such conservation practices, and is based on such
principles, as the Secretary considers necessary to carry out
the program, including a description of structural practices
and land management practices to be implemented and the
objectives to be met by the plan's implementation.
[(b) Avoidance of Duplication.--The Secretary shall, to the
maximum extent practicable, eliminate duplication of planning
activities under the environmental quality incentives program
and comparable conservation programs.
[SEC. 1240F. DUTIES OF THE SECRETARY.
[To the extent appropriate, the Secretary shall assist a
producer in achieving the conservation and environmental goals
of an environmental quality incentives program plan by--
[(1) providing an eligibility assessment of the
farming or ranching operation of the producer as a
basis for developing the plan;
[(2) providing technical assistance in developing and
implementing the plan;
[(3) providing technical assistance, cost-share
payments, or incentive payments for developing and
implementing 1 or more structural practices or 1 or
more land management practices, as appropriate;
[(4) providing the producer with information,
education, and training to aid in implementation of the
plan; and
[(5) encouraging the producer to obtain technical
assistance, cost-share payments, or grants from other
Federal, State, local, or private sources.
[SEC. 1240G. LIMITATION ON PAYMENTS.
[(a) In General.--The total amount of cost-share and
incentive payments paid to a producer under this chapter may
not exceed--
[(1) $10,000 for any fiscal year; or
[(2) $50,000 for any multiyear contract.
[(b) Exception to Annual Limit.--The Secretary may exceed
the limitation on the annual amount of a payment under
subsection (a)(1) on a case-by-case basis if the Secretary
determines that a larger payment is--
[(1) essential to accomplish the land management
practice or structural practice for which the payment
is made; and
[(2) consistent with the maximization of
environmental benefits per dollar expended and the
purposes of this chapter specified in section 1240.
[(c) Timing of Expenditures.--Expenditures under a contract
entered into under this chapter during a fiscal year may not be
made by the Secretary until the subsequent fiscal year.
[SEC. 1240H. TEMPORARY ADMINISTRATION OF ENVIRONMENTAL QUALITY
INCENTIVES PROGRAM.
[(a) Interim Administration.--
[(1) In general.--During the period beginning on the
date of enactment of this section and ending on the
termination date provided under paragraph (2), to
ensure that technical assistance, cost-share payments,
and incentive payments continue to be administered in
an orderly manner until such time as assistance can be
provided through final regulations issued to implement
the environmental quality incentives program
established under this chapter, the Secretary shall
continue to--
[(A) provide technical assistance, cost-share
payments, and incentive payments under the
terms and conditions of the agricultural
conservation program, the Great Plains
conservation program, the water quality
incentives program, and the Colorado River
Basin salinity control program, to the extent
the terms and conditions of the program are
consistent with the environmental quality
incentives program; and
[(B) use for those purposes--
[(i) any funds remaining available
for the agricultural conservation
program, the Great Plains conservation
program, the water quality incentives
program, and the Colorado River Basin
salinity control program; and
[(ii) as the Secretary determines to
be necessary, any funds authorized to
be used to carry out the environmental
quality incentives program.
[(2) Termination of authority.--The authority of the
Secretary to carry out paragraph (1) shall terminate on
the date that is 180 days after the date of enactment
of this section.
[(b) Permanent Administration.--Effective beginning on the
termination date provided under subsection (a)(2), the
Secretary shall provide technical assistance, cost-share
payments, and incentive payments for structural practices and
land management practices related to crop and livestock
production in accordance with final regulations issued to carry
out the environmental quality incentives program.]
SEC. 1240. PURPOSES.
The purposes of the environmental quality incentives
program established by this chapter are to promote agricultural
production and environmental quality as compatible national
goals, and to maximize environmental benefits per dollar
expended, by--
(1) assisting producers in complying with--
(A) this title;
(B) the Federal Water Pollution Control Act
(33 U.S.C. 1251 et seq.);
(C) the Safe Drinking Water Act (42 U.S.C.
300f et seq.);
(D) the Clean Air Act (42 U.S.C. 7401 et
seq.); and
(E) other Federal, State, and local
environmental laws (including regulations);
(2) avoiding, to the maximum extent practicable, the
need for resource and regulatory programs by assisting
producers in protecting soil, water, air, and related
natural resources and meeting environmental quality
criteria established by Federal, State, and local
agencies;
(3) providing flexible technical and financial
assistance to producers to install and maintain
conservation systems that enhance soil, water, related
natural resources (including grazing land and wetland),
and wildlife while sustaining production of food and
fiber;
(4) assisting producers to make beneficial, cost
effective changes to cropping systems, grazing
management, nutrient management associated with
livestock, pest or irrigation management, or other
practices on agricultural land;
(5) facilitating partnerships and joint efforts among
producers and governmental and nongovernmental
organizations; and
(6) consolidating and streamlining conservation
planning and regulatory compliance processes to reduce
administrative burdens on producers and the cost of
achieving environmental goals.
SEC. 1240A. DEFINITIONS.
In this chapter:
(1) Beginning farmer or rancher.--The term
``beginning farmer or rancher'' has the meaning
provided under section 343(a) of the Consolidated Farm
and Rural Development Act (7 U.S.C. 1999(a)).
(2) Comprehensive nutrient management.--
(A) In general.--The term ``comprehensive
nutrient management'' means any combination of
structural practices, land management
practices, and management activities associated
with crop or livestock production described in
subparagraph (B) that collectively ensure that
the goals of crop or livestock production and
preservation of natural resources (especially
the preservation and enhancement of water
quality) are compatible.
(B) Elements.--For the purpose of
subparagraph (A), structural practices, land
management practices, and management activities
associated with livestock production are--
(i) manure and wastewater handling
and storage;
(ii) manure processing, composting,
or digestion for purposes of capturing
emissions, concentrating nutrients for
transport, destroying pathogens or
otherwise improving the environmental
safety and beneficial uses of manure;
(iii) land treatment practices;
(iv) nutrient management;
(v) recordkeeping;
(vi) feed management; and
(vii) other waste utilization
options.
(C) Practice.--
(i) Planning.--The development of a
comprehensive nutrient management plan
shall be a practice that is eligible
for incentive payments and technical
assistance under this chapter.
(ii) Implementation.--The
implementation of a comprehensive
nutrient plan shall be accomplished
through structural and land management
practices identified in the plan.
(3) Eligible land.--The term ``eligible land'' means
agricultural land (including cropland, grassland,
rangeland, pasture, private nonindustrial forest land,
and other land on which crops or livestock are
produced), including agricultural land that the
Secretary determines poses a serious threat to soil,
water, or related resources by reason of the soil
types, terrain, climatic, soil, topographic, flood,
or saline characteristics, or other factors or
natural hazards.
(4) Innovative technology.--The term ``innovative
technology'' means a new conservation technology that,
as determined by the Secretary--
(A) maximizes environmental benefits;
(B) complements agricultural production; and
(C) may be adopted in a practical manner.
(5) Land management practice.--The term ``land
management practice'' means a site-specific nutrient or
manure management, integrated pest management,
irrigation management, tillage or residue management,
grazing management, air quality management, or other
land management practice carried out on eligible land
that the Secretary determines is needed to protect from
degradation, in the most cost-effective manner, water,
soil, or related resources.
(6) Livestock.--The term ``livestock'' means dairy
cattle, beef cattle, laying hens, broilers, turkeys,
swine, sheep, and such other animals as are determined
by the Secretary.
(7) Maximize environmental benefits per dollar
expended.--
(A) In general.--The term ``maximize
environmental benefits per dollar expended''
means to maximize environmental benefits to the
extent the Secretary determines is practicable
and appropriate, taking into account the amount
of funding made available to carry out this
chapter.
(B) Limitation.--The term ``maximize
environmental benefits per dollar expended''
does not require the Secretary--
(i) to require the adoption of the
least cost practice or technical
assistance; or
(ii) to require the development of a
plan under section 1240E as part of an
application for payments or technical
assistance.
(8) Practice.--The term ``practice'' means 1 or more
structural practices, land management practices, and
comprehensive nutrient management planning practices.
(9) Producer.--The term ``producer'' has the meaning
given the term in section 102 of the Agricultural
Market Transition Act (7 U.S.C. 7202).
(10) Structural practice.--The term ``structural
practice'' means--
(A) the establishment on eligible land of a
site-specific animal waste management facility,
terrace, grassed waterway, contour grass strip,
filterstrip, tailwater pit, permanent wildlife
habitat, constructed wetland, or other
structural practice that the Secretary
determines is needed to protect, in the most
cost-effective manner, water, soil, or related
resources from degradation; and
(B) the capping of abandoned wells on
eligible land.
[SEC. 1240B. ESTABLISHMENT AND ADMINISTRATION OF ENVIRONMENTAL
QUALITY INCENTIVES PROGRAM.
(a) Establishment.--
(1) In general.--During each of the 2002 through 2006
fiscal years, the Secretary shall provide technical
assistance, cost-share payments, and incentive payments
to producers, that enter into contracts with the
Secretary, through an environmental quality incentives
program in accordance with this chapter.
(2) Eligible practices.--
(A) Structural practices.--A producer that
implements a structural practice shall
be eligible for any combination of technical
assistance, cost-share payments, and education.
(B) Land management practices.--A producer
that performs a land management practice shall
be eligible for any combination of technical
assistance, incentive payments, and education.
(C) Comprehensive nutrient management
planning.--A producer that develops a
comprehensive nutrient management plan shall be
eligible for any combination of technical
assistance, incentive payments, and education.
(3) Education.--The Secretary may provide
conservation education at national, State, and local
levels consistent with the purposes of the
environmental quality incentives program to--
(A) any producer that is eligible for
assistance under this chapter; or
(B) any producer that is engaged in the
production of an agricultural commodity.
(b) Application and Term.--With respect to practices
implemented under this chapter--
(1) a contract between a producer and the Secretary
may--
(A) apply to 1 or more structural practices,
land management practices, and comprehensive
nutrient management planning practices; and
(B) have a term of not less than 3, nor more
than 10, years, as determined appropriate by
the Secretary, depending on the practice or
practices that are the basis of the contract;
and
(2) a producer may not enter into more than 1
contract for structural practices involving livestock
nutrient management during the period of fiscal years
2002 through 2006.
(c) Application and Evaluation.--
(1) In general.--The Secretary shall establish an
application and evaluation process for awarding
technical assistance, cost-share payments, and
incentive payments to a producer in exchange for the
performance of 1 or more practices that maximizes
environmental benefits per dollar expended.
(2) Comparable environmental value.--
(A) In general.--The Secretary shall
establish a process for selecting applications
for technical assistance, cost-share payments,
and incentive payments when there are numerous
applications for assistance for practices that
would provide substantially the same level of
environmental benefits.
(B) Criteria.--The process under subparagraph
(A) shall be based on--
(i) a reasonable estimate of the
projected cost of the proposals
described in the applications; and
(ii) the priorities established under
this chapter and other factors that
maximize environmental benefits per
dollar expended.
(3) Consent of owner.--If the producer making an
offer to implement a structural practice is a tenant of
the land involved in agricultural production, for the
offer to be acceptable, the producer shall obtain the
consent of the owner of the land with respect to the
offer.
(4) Bidding down.--If the Secretary determines that
the environmental values of 2 or more applications for
technical assistance, cost-share payments, or incentive
payments are comparable, the Secretary shall not assign
a higher priority to the application only because it
would present the least cost to the program established
under this chapter.
(d) Cost-Share Payments.--
(1) In general.--Except as provided in paragraph (2),
the cost-share payments provided to a producer
proposing to implement 1 or more practices under the
program shall be not more than 75 percent of the cost
of the practice, as determined by the Secretary.
(2) Exceptions.--
(A) Limited resource and beginning farmers.--
The Secretary may increase the amount provided
to a producer under paragraph (1) to not more
than 90 percent if the producer is a limited
resource or beginning farmer or rancher, as
determined by the Secretary.
(B) Cost-share assistance from other
sources.--Any cost-share payments received by a
producer from a State or private organization
or person for the implementation of 1 or more
practices shall be in addition to the payments
provided to the producer under paragraph (1).
(3) Other payments.--A producer shall not be eligible
for cost-share payments for practices on eligible land
under this chapter if the producer receives cost-share
payments or other benefits for the same practice on the
same land under chapter 1 and this chapter.
(e) Incentive Payments.--The Secretary shall make incentive
payments in an amount and at a rate determined by the Secretary
to be necessary to encourage a producer to perform 1 or more
practices.
(f) Technical Assistance.--
(1) In general.--The Secretary shall allocate funding
under this chapter for the provision of technical
assistance according to the purpose and projected cost
for which the technical assistance is provided for a
fiscal year.
(2) Amount.--The allocated amount may vary according
to--
(A) the type of expertise required;
(B) the quantity of time involved; and
(C) other factors as determined appropriate
by the Secretary.
(3) Limitation.--Funding for technical assistance
under this chapter shall not exceed the projected cost
to the Secretary of the technical assistance provided
for a fiscal year.
(4) Other authorities.--The receipt of technical
assistance under this chapter shall not affect the
eligibility of the producer to receive technical
assistance under other authorities of law available to
the Secretary.
(5) Incentive payments for technical assistance.--
(A) In general.--A producer that is eligible
to receive technical assistance for a practice
involving the development of a comprehensive
nutrient management plan may obtain an
incentive payment that can be used to obtain
technical assistance associated with the
development of any component of the
comprehensive nutrient management plan.
(B) Purpose.--The purpose of the payment
shall be to provide a producer the option of
obtaining technical assistance for developing
any component of a comprehensive nutrient
management plan from a private person.
(C) Payment.--The incentive payment shall
be--
(i) in addition to cost-share or
incentive payments that a producer
would otherwise receive for structural
practices and land management
practices;
(ii) used only to procure technical
assistance from a private person that
is necessary to develop any component
of a comprehensive nutrient management
plan; and
(iii) in an amount determined
appropriate by the Secretary, taking
into account--
(I) the extent and complexity
of the technical assistance
provided;
(II) the costs that the
Secretary would have incurred
in providing the technical
assistance; and
(III) the costs incurred by
the private provider in
providing the technical
assistance.
(D) Eligible practices.--The Secretary may
determine, on a case by case basis, whether the
development of a comprehensive nutrient
management plan is eligible for an incentive
payment under this paragraph.
(E) Certification by secretary.--
(i) In general.--Only private persons
that have been certified by the
Secretary under section 1244 (f)(3)
shall be eligible to provide technical
assistance under this subsection.
(ii) Quality assurance.--The
Secretary shall ensure that certified
private providers are capable of
providing technical assistance
regarding comprehensive nutrient
management in a manner that meets the
specifications and guidelines of the
Secretary and that meets the needs of
producers under the environmental
quality incentives program.
(F) Advance payment.--On the determination of
the Secretary that the proposed comprehensive
nutrient management of a producer is eligible
for an incentive payment, the producer may
receive a partial advance of the incentive
payment in order to procure the services of a
certified private provider.
(G) Final payment.--The final installment of
the incentive payment shall be payable to a
producer on presentation to the Secretary of
documentation that is satisfactory to the
Secretary and that demonstrates--
(i) completion of the technical
assistance; and
(ii) the actual cost of the technical
assistance.
(h) Modification or Termination of Contracts.--
(1) Voluntary modification or termination.--The
Secretary may modify or terminate a contract entered
into with a producer under this chapter if--
(A) the producer agrees to the modification
or termination; and
(B) the Secretary determines that the
modification or termination is in the public
interest.
(2) Involuntary termination.--The Secretary may
terminate a contract under this chapter if the
Secretary determines that the producer violated the
contract.
SEC. 1240C. EVALUATION OF OFFERS AND PAYMENTS.
(a) In General.--In evaluating applications for technical
assistance, cost-share payments, and incentive payments, the
Secretary shall accord a higher priority to assistance and
payments that--
(1) maximize environmental benefits per dollar
expended; and
(2)(A) address national conservation priorities,
including--
(i) meeting Federal, State, and local
environmental purposes focused on protecting
air and water quality;
(ii) comprehensive nutrient management;
(iii) water quality, particularly in impaired
watersheds;
(iv) soil erosion; or
(v) air quality;
(B) are provided in conservation priority areas
established under section 1230(c);
(C) are provided in special projects under section
1243(f)(4) with respect to which State or local
governments have provided, or will provide, financial
or technical assistance to producers for the same
conservation or environmental purposes; or
(D) an innovative technology in connection with a
structural practice or land management practice.
SEC. 1240D. DUTIES OF PRODUCERS.
To receive technical assistance, cost-share payments, or
incentive payments under this chapter, a producer shall agree--
(1) to implement an environmental quality incentives
program plan that describes conservation and
environmental goals to be achieved through 1 or more
practices that are approved by the Secretary;
(2) not to conduct any practices on the farm or ranch
that would tend to defeat the purposes of this chapter;
(3) on the violation of a term or condition of the
contract at any time the producer has control of the
land--
(A) If the Secretary determines that the
violation warrants termination of the
contract--
(i) to forfeit all rights to receive
payments under the contract; and
(ii) to refund to the Secretary all
or a portion of the payments received
by the owner or operator under the
contract, including any interest on the
payments, as determined by the
Secretary; or
(B) if the Secretary determines that the
violation does not warrant termination of the
contract, to refund to the Secretary, or accept
adjustments to, the payments provided to the
owner or operator, as the Secretary determines
to be appropriate;
(4) on the transfer of the right and interest of the
producer in land subject to the contract, unless the
transferee of the right and interest agrees with the
Secretary to assume all obligations of the contract, to
refund all cost-share payments and incentive payments
received under this chapter, as determined by the
Secretary;
(5) to supply information as required by the
Secretary to determine compliance with the
environmental quality incentives program plan and
requirements of the program; and
(6) to comply with such additional provisions as the
Secretary determines are necessary to carry out the
environmental quality incentives program plan.
SEC. 1240E. ENVIRONMENTAL QUALITY INCENTIVES PROGRAM PLAN.
(a) In General.--To be eligible to receive technical
assistance, cost-share payments, or incentive payments under
the environmental quality incentives program, a producer of a
livestock or agricultural operation shall submit to the
Secretary for approval a plan of operations that specifies
practices covered under this chapter, and is based on such
terms and conditions, as the Secretary considers necessary to
carry out the program, including a description of the practices
to be implemented and the purposes to be met by the
implementation of the plan.
(b) Avoidance of Duplication.--The Secretary shall, to the
maximum extent practicable, eliminate duplication of planning
activities under the environmental quality incentives program
and comparable conservation programs.
SEC. 1240F. DUTIES OF THE SECRETARY.
To the extent appropriate, the Secretary shall assist a
producer in achieving the conservation and environmental goals
of an environmental quality incentives program plan by--
(1) providing technical assistance in developing and
implementing the plan;
(2) providing technical assistance, cost-share
payments, or incentive payments for developing and
implementing 1 or more practices, as appropriate;
(3) providing the producer with information,
education, and training to aid in implementation of the
plan; and
(4) encouraging the producer to obtain technical
assistance, cost-share payments, or grants from other
Federal, State, local, or private sources.
SEC. 1240G. LIMITATION ON PAYMENTS.
(a) In General.--An individual or entity may not receive,
directly or indirectly, payments under this chapter that
exceed--
(1) $50,000 for any fiscal year; or
(2) $150,000 for any multiyear contract.
(b) Verification.--The Secretary shall identify individuals
and entities that are eligible for a payment under this chapter
using social security numbers and taxpayer identification
numbers, respectively.
SEC. 1240H. CONSERVATION INNOVATION GRANTS.
(a) In General.--From funds made available to carry out
this chapter, for each of the 2003 through 2006 fiscal years
the Secretary shall use not more than $100,000,000 for each
fiscal year to pay the Federal share of competitive grants that
are intended to stimulate innovative approaches to leveraging
Federal investment in environmental enhancement and protection,
in conjunction with agricultural production, through the
environmental quality incentives program.
(b) Use.--The Secretary may award grants under this section
to governmental and nongovernmental organizations and persons,
on a competitive basis, to carry out projects that--
(1) involve producers that are eligible for payments
or technical assistance under this chapter;
(2) implement innovative projects, such as--
(A) market systems for pollution reduction;
(B) promoting agricultural best management
practices, including the storing of carbon in
the soil; and
(C) protection of source water for human
consumption; and
(3) leverage funds made available to carry out this
chapter with matching funds provided by State and local
governments and private organizations to promote
environmental enhancement and protection in conjunction
with agricultural production.
(c) Cost Share.--The amount of a grant made under this
section to carry out a project shall not exceed 50 percent of
the cost of the project.
(d) Unused Funding.--Any funds made available for a fiscal
year under this section that are not obligated by June 1 of the
fiscal year may be used to carry out other activities under
this chapter during the fiscal year in which the funding
becomes available.
[CHAPTER 5--CONSERVATION FARM OPTION
[SEC. 1240M. CONSERVATION FARM OPTION.
[(a) In General.--The Secretary shall establish
conservation farm option pilot programs for producers of wheat,
feed grains, cotton, and rice.
[(b) Eligible Owners and Producers.--An owner or producer
with a farm that has contract acreage enrolled in the
agricultural market transition program established under the
Agricultural Market Transition Act shall be eligible to
participate in the conservation farm option offered under a
pilot program under subsection (a) if the owner or producer
meets the conditions established under section (e).
[(c) Purposes.--The purposes of the conservation farm
option pilot programs shall include--
[(1) conservation of soil, water, and related
resources;
[(2) water quality protection or improvement;
[(3) wetland restoration, protection, and creation;
[(4) wildlife habitat development and protection; or
[(5) other similar conservation purposes.
[(d) Conservation Farm Plan.--
[(1) In general.--To be eligible to enter into a
conservation farm option contract, an owner or producer
must prepare and submit to the Secretary, for approval,
a conservation farm plan that shall become a part of
the conservation farm option contract.
[(2) Requirements.--A conservation farm plan shall--
[(A) describe the resource-conserving crop
rotations, and all other conservation
practices, to be implemented and maintained on
the acreage that is subject to contract during
the contract period;
[(B) contain a schedule for the
implementation and maintenance of the practices
described in the conservation farm plan;
[(C) comply with highly erodible land and
wetland conservation requirements of this
title; and
[(D) contain such other terms as the
Secretary may require.
[(e) Contracts.--
[(1) In general.--On approval of a conservation farm
plan, the Secretary may enter into a contract with the
owner or producer that specifies the acres being
enrolled and the practices being adopted.
[(2) Duration of contract.--The contract shall be for
a period of 10 years. The contract may be renewed for a
period of not to exceed 5 years on mutual agreement of
the Secretary and the owner or producer.
[(3) Consideration.--In exchange for payments under
this subsection, the owner or producer shall not
participate in and shall forgo payments under--
[(A) the conservation reserve program
established under subchapter B of chapter 1;
[(B) the wetlands reserve program established
under subchapter C of chapter 1; and
[(C) the environmental quality incentives
program established under chapter 4.
[(4) Owner or producer responsibilities under the
agreement.--Under the terms of the contract entered
into under this section, an owner or producer shall
agree to--
[(A) actively comply with the terms and
conditions of the approved conservation farm
plan;
[(B) keep such records as the Secretary may
reasonably require for purposes of evaluation
of the implementation of the conservation farm
plan; and
[(C) not engage in any activity that would
defeat the purposes of the conservation farm
option pilot program.
[(5) Payments.--The Secretary shall offer an owner or
producer annual payments under the contract that are
equivalent to the payments the owner or producer would
have received under the conservation reserve program,
the wetlands reserve program, and the environmental
quality incentives program.
[(6) Balance of benefits.--The Secretary shall not
permit an owner or producer to terminate a conservation
reserve program contract and enter a conservation farm
option contract if the Secretary determines that such
action will reduce net environmental benefits.
[(f) Secretarial Determinations.--
[(1) Acreage estimates.--Prior to each year during
which the Secretary intends to offer conservation
reserve program contracts, the Secretary shall estimate
the number of acres that--
[(A) will be retired under the conservation
farm option under the terms and conditions the
Secretary intends to offer for that program;
and
[(B) would be retired under the conservation
reserve program if the conservation farm option
were not available.
[(2) Total land retirement.--The Secretary shall
announce a number of acres to be enrolled in the
conservation reserve program that will result in a
total number of acres retired under the conservation
reserve program and the conservation farm option that
does not exceed the amount estimated under paragraph
(1)(B) for the current or future years.
[(3) Limitation.--The Secretary shall not enroll
additional conservation reserve program contracts to
offset the land retired under the conservation farm
option.
[(g) Commodity Credit Corporation.--The Secretary shall use
the funds, authorities, and facilities of the Commodity Credit
Corporation to carry out this subsection.
[(h) Funding.--Of the funds of the Commodity Credit
Corporation, the Corporation shall make available to carry out
this section--
[(1) $7,500,000 for fiscal year 1997;
[(2) $15,000,000 for fiscal year 1998;
[(3) $25,000,000 for fiscal year 1999;
[(4) $37,500,000 for fiscal year 2000;
[(5) $50,000,000 for fiscal year 2001; and
[(6) $62,500,000 for fiscal year 2002.
CHAPTER 5--OTHER CONSERVATION PROGRAMS
SEC. 1240M. WILDLIFE HABITAT INCENTIVE PROGRAM.
(a) Definitions.--In this section:
(1) Endangered species.--The term `endangered
species' has the meaning given the term in section 3 of
the Endangered Species Act of 1973 (16 U.S.C. 1532).
(2) Program.--The term `program' means the wildlife
habitat incentive program established under subsection
(b).
(3) Threatened species.--The term `threatened
species' has the meaning given the term in section 3 of
the Endangered Species Act of 1973 (16 U.S.C. 1532).
(b) Establishment.--In consultation with the State
technical committees established under section 1261 of the Food
Security Act of 1985 (16 U.S.C. 3861), the Secretary shall
establish the wildlife habitat incentive program.
(c) Cost-Share Payments.--
(1) In general.--Under the program, the Secretary
shall make cost-share payments to owners of eligible
land to develop wildlife habitat approved by the
Secretary.
(2) Endangered and threatened species.--Of the funds
made available to carry out this subsection, the
Secretary shall use at least 15 percent to make cost-
share payments to carry out projects and activities
relating to endangered species and threatened species.
(d) Pilot Program for Essential Plant and Animal Habitat.--
Under the program, the Secretary may establish procedures to
use not more than 15 percent of funds made available to acquire
and enroll eligible land for periods of at least 15 years to
protect essential (as determined by the Secretary) plant and
animal habitat.
(e) Funding.--Of the funds of the Commodity Credit
Corporation, the Secretary shall use to carry out this section
(including the provision of technical assistance)--
(1) $50,000,000 for fiscal year 2002;
(2) $100,000,000 for each of fiscal years 2003 and
2004; and
(3) $125,000,000 for each of fiscal years 2005 and
2006.
SEC. 1240N. WATERSHED RISK REDUCTION.
(a) In General.--The Secretary, acting through the Natural
Resources Conservation Service (referred to in this section as
the ``Secretary''), in cooperation with landowners and land
users, may carry out such projects and activities (including
the purchase of floodplain easements for runoff retardation and
soil erosion prevention) as the Secretary determines to be
necessary to safeguard lives and property from floods, drought,
and the products of erosion on any watershed in any case in
which fire, flood, or any other natural occurrence has caused,
is causing or may cause a sudden impairment of that watershed.
(b) Priority.--In carrying out this section, the Secretary
shall give priority to any project or activity described in
subsection (a) that is carried out on a floodplain adjacent to
a major river, as determined by the Secretary.
(c) Prohibition on Duplicative Funds.--No project or
activity under subsection (a) that is carried out using funds
made available under this section may be carried out using
funds made available under any Federal disaster relief program
administered by the Secretary relating to floods.
(d) Funding.--There is authorized to be appropriated to
carry out this section $15,000,000 for each of fiscal years
2002 through 2006.
SEC. 1240O. GREAT LAKES BASIN PROGRAM FOR SOIL EROSION AND SEDIMENT
CONTROL.
(a) In General.--The Secretary, in consultation with the
Great Lakes Commission created by Article IV of the Great Lakes
Basin Compact (82 Stat. 415) and in cooperation with the
Administrator of the Environmental Protection Agency and the
Secretary of the Army, may carry out the Great Lakes basin
program for soil erosion and sediment control (referred to in
this section as the ``program''.
(b) Assistance.--In carrying out the program, the Secretary
may--
(1) provide project demonstration grants, provide
technical assistance, and carry out information and
education programs to improve water quality in the
Great Lakes basin by reducing soil erosion and
improving sediment control; and
(2) provide a priority for projects and activities
that directly reduce soil erosion or improve sediment
control.
(c) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $5,000,000 for
each of fiscal years 2002 through 2006.
SEC. 1240P. CONSERVATION OF PRIVATE GRAZING LAND.
(a) Findings.--Congress finds that--
(1) private grazing land constitutes nearly \1/2\ of
the non-Federal land of the United States and is basic
to the environmental, social, and economic stability of
rural communities;
(2) private grazing land contains a complex set of
interactions among soil, water, air, plants, and
animals;
(3) grazing land constitutes the single largest
watershed cover type in the United States and
contributes significantly to the quality and quantity
of water available for all of the many uses of the
land;
(4) private grazing land constitutes the most
extensive wildlife habitat in the United States;
(5) private grazing land can provide opportunities
for improved nutrient management from land application
of animal manures and other by-product nutrient
resources;
(6) owners and managers of private grazing land need
to continue to recognize conservation problems when the
problems arise and receive sound technical assistance
to improve or conserve grazing land resources to meet
ecological and economic demands;
(7) new science and technology must continually be
made available in a practical manner so owners and
managers of private grazing land may make informed
decisions concerning vital grazing land resources;
(8) agencies of the Department with private grazing
land responsibilities are the agencies that have the
expertise and experience to provide technical
assistance, education, and research to owners and
managers of private grazing land for the long-term
productivity and ecological health of grazing land;
(9) although competing demands on private grazing
land resources are greater than ever before, assistance
to private owners and managers of private grazing land
is currently limited and does not meet the demand and
basic need for adequately sustaining or enhancing the
private grazing land resources; and
(10) private grazing land can be enhanced to provide
many benefits to all citizens of the United States
through voluntary cooperation among owners and managers
of the land, local conservation districts, and the
agencies of the Department responsible for providing
assistance to owners and managers of land and to
conservation districts.
(b) Purpose.--The purpose of this section is to authorize
the Secretary to provide a coordinated technical, educational,
and related assistance program to conserve and enhance private
grazing land resources and provide related benefits to all
citizens of the United States by--
(1) establishing a coordinated and cooperative
Federal, State, and local grazing conservation program
for management of private grazing land;
(2) strengthening technical, educational, and related
assistance programs that provide assistance to owners
and managers of private grazing land;
(3) conserving and improving wildlife habitat on
private grazing land;
(4) conserving and improving fish habitat and aquatic
systems through grazing land conservation treatment;
(5) protecting and improving water quality;
(6) improving the dependability and consistency of
water supplies;
(7) identifying and managing weed, noxious weed, and
brush encroachment problems on private grazing land;
and
(8) integrating conservation planning and management
decisions by owners and managers of private grazing
land, on a voluntary basis.
(c) Definition of Private Grazing Land.--In this section,
the term ``private grazing land'' means rangeland, pastureland,
grazed forest land, hay land, and any other non-federally owned
land that is--
(1) private;
(2) owned by a State; or
(3) under the jurisdicition of an Indian tribe.
(d) Private Grazing Land Conservation Assistance.--
(1) In general.--Subject to the availability of
appropriations for this section, the Secretary shall
establish a voluntary program to provide technical,
educational, and related assistance to owners and
managers of private grazing land and public agencies,
through local conservation districts, to enable the
landowners, managers, and public agencies to
voluntarily carry out activities that are consistent
with this section, including--
(A) maintaining and improving private grazing
land and the multiple values and uses that
depend on private grazing land;
(B) implementing grazing land management
technologies;
(C) managing resources on private grazing
land, including--
(i) planning, managing, and treating
private grazing land resources;
(ii) ensuring the long-term
sustainability of private grazing land
resources;
(iii) harvesting, processing, and
marketing private grazing land
resources; and
(iv) identifying and managing weed,
noxious weed, and brush encroachment
problems;
(D) protecting and improving the quality and
quantity of water yields from private grazing
land;
(E) maintaining and improving wildlife and
fish habitat on private grazing land;
(F) enhancing recreational opportunities on
private grazing land;
(G) maintaining and improving the aesthetic
character of private grazing land; and
(H) identifying the opportunities and
encouraging the diversification of private
grazing land enterprises.
(2) Program elements.--
(A) Funding.--Funds may be used to carry out
this section only if funds are provided through
a specific line-item in the annual
appropriations for the Natural Resources
Conservation Service.
(B) Technical assistance and education.--
Personnel of the Department of Agriculture
trained in pasture and range management shall
be made available under the program to deliver
and coordinate technical assistance and
education to owners and managers of private
grazing land, at the request of the owners and
managers.
(e) Grazing Technical Assistance Self-Help.--
(1) Findings.--Congress finds that--
(A) there is a severe lack of technical
assistance for farmers and ranchers that graze
livestock;
(B) Federal budgetary constraints preclude
any significant expansion, and may force a
reduction of, current levels of technical
support; and
(C) farmers and ranchers have a history of
cooperatively working together to address
common needs in the promotion of their products
and in the drainage of wet areas through
drainage districts.
(2) Establishment of grazing demonstration
districts.--In accordance with paragraph (2), the
Secretary may establish 2 grazing management
demonstration districts on the recommendation of the
grazing land conservation initiative steering
committee.
(3) Procedure.--
(A) Proposal.--Within a reasonable time after
the submission of a proposal of an organization
of farmers or ranchers engaged in grazing in a
district, subject to subparagraphs (B) through
(F), the Secretary establish a grazing
management district in accordance with the
proposal.
(B) Funding.--The terms and conditions of the
funding and operation of the grazing management
district shall be proposed by the farmers and
ranchers engaged in grazing in the district.
(C) Approval.--The Secretary shall approve
the proposal if the Secretary determines that
the proposal--
(i) is reasonable;
(ii) will promote sound grazing
practices; and
(iii) contains provisions similar to
the provisions contained in the beef
promotion and research order issued
under section 4 of the Beef Research
and Information Act (7 U.S.C. 2903) in
effect on April 4, 1996.
(D) Area included.--The area proposed to be
included in a grazing management district shall
be determined by the Secretary on the basis of
the proposal submitted by farmers or ranchers
under subparagraph (A).
(E) Authorization.--The Secretary may use
authority under the Agricultural Adjustment Act
(7 U.S.C. 601 et seq.), reenacted with
amendments by the Agricultural Marketing
Agreement Act of 1937, to operate, on a
demonstration basis, a grazing management
district.
(F) Activities.--The activities of a grazing
management district shall be scientifically
sound activities, as determined by the
Secretary in consultation with a technical
advisory committee composed of farmers,
ranchers and technical experts.
(f) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $60,000,000 for
each of fiscal years 2002 through 2006.''.
* * * * * * *
SEC. 1241. FUNDING.
(a) Mandatory Expenses.--For each of fiscal years 1996
through [2002] 2006, the Secretary shall use the funds of the
Commodity Credit Corporation to carry out the programs
(including the provision of technical assistance) authorized
by--
(1) subchapter B of chapter 1 of subtitle D
(including contracts extended by the Secretary pursuant
to section 1437 of the Food, Agriculture, Conservation,
and Trade Act of 1990 (Public Law 101-624; 16 U.S.C.
3831 note));
(2) [subchapter C] subchapters C and D of chapter 1
of subtitle D; and
(3) chapter 4 of subtitle D.
[(b) Environmental Quality Incentives Program.--
[(1) In general.--Of the funds of the Commodity
Credit Corporation, the Secretary shall make available
$130,000,000 for fiscal year 1996, and $200,000,000 for
each of fiscal years 1997 through 2002, for providing
technical assistance, cost-share payments, incentive
payments, and education under the environmental quality
incentives program under chapter 4 of subtitle D.
[(2) Livestock production.--For each of fiscal years
1996 through 2002, 50 percent of the funding available
for technical assistance, cost-share payments,
incentive payments, and education under the
environmental quality incentives program shall be
targeted at practices relating to livestock
production.]
(b) Environmental Quality Incentives Program.--
(1) In general.--Of the funds of the Commodity Credit
Corporation, the Secretary shall make available to
provide technical assistance, cost-share payments,
incentive payments, bonus payments, grants, and
education under the environmental quality incentives
program under chapter 4 of subtitle D--
(A) $500,000,000 for fiscal year 2002;
(B) $1,050,000,000 for fiscal year 2003;
(C) $1,200,000,000 for fiscal year 2004;
(D) $1,200,000,000 for fiscal year 2005; and
(E) $1,250,000,000 for fiscal year 2006.
(2) Obligation of funds.--
(A) In general.--If a contract under the
environmental quality incentives program under
chapter 4 of subtitle D is terminated, or work
under the contract is completed, prior to the
end of the term of the contract and funds
obligated for the contract have not been
expended, the unexpended funds may be used to
carry out any other contract under the program
during the same fiscal year in which the
original contract was terminated.
(B) Additional uses of funds.--Funding for
contracts that terminate under the program
administered under subchapter B of chapter 1
may be transferred to, and used to carry out,
the program under chapter 4 of subtitle D.
(c) Conservation Security Program.--Of the funds of the
Commodity Credit Corporation, the Corporation shall make
available for each of fiscal years 2002 through 2006 such sums
as are necessary to carry out subchapter A of chapter 2
(including the provision of technical assistance).
(d) Farmland Protection Program.--
(1) In general.--Of the funds of the Commodity Credit
Corporation, the Secretary shall use to carry out
subchapter B of chapter 2 (including the provision of
technical assistance)--
(A) $150,000,000 for fiscal year 2002;
(B) $200,000,000 for each of fiscal years
2003 and 2004;
(C) $225,000,000 for fiscal year 2005; and
(D) $250,000,000 for fiscal year 2006.
(2) Cost sharing.--
(A) Farmland protection.--
(i) In general.--The share of the
cost of purchasing a conservation
easement or other interest described in
section 1238I(a) provided under this
subsection shall not exceed 50 percent.
(ii) State and local contributions.--
In a case in which a State or local
government purchases an easement under
section 1238I(a), not more than 25
percent of the share of the cost of the
easement contributed by the State or
local government may be provided--
(I) by a private landowner;
or
(II) in the form of in-kind
goods or services.
(B) Market viability contributions.--As a
condition of receiving a grant under section
1238J(a), a grantee shall provide funds in an
amount equal to the amount of the grant.
* * * * * * *
SEC. 1243. [ADMINISTRATION.] ADMINISTRATION OF CCEP.
(a) Plans.--The Secretary shall, to the extent practicable,
avoid duplication in--
(1) the conservation plans required for--
(A) highly erodible land conservation under
subtitle B;
(B) the conservation reserve program
established under subchapter B of chapter 1 of
subtitle D; and
(C) the wetlands reserve program established
under subchapter C of chapter 1 of subtitle D;
and
(2) the environmental quality incentives program
established under chapter 4 of subtitle D.
(b) Acreage Limitation.--
(1) In general.--[The Secretary] Except for land
enrolled under continuous signup (as described in
section 1231 (b)(6)), the Secretary shall not enroll
more than 25 percent of the cropland in any county in
the programs administered under the conservation
reserve and wetlands reserve programs established under
subchapters B and C, respectively, of chapter 1 of
subtitle D. Not more than 10 percent of the cropland in
a county may be subject to an easement acquired under
the subchapters.
(2) Exception.--The Secretary may exceed the
limitations in paragraph (1) if the Secretary
determines that--
* * * * * * *
(e) Regulations.--Not later than 90 days after the date of
enactment of the Federal Agriculture Improvement and Reform Act
of 1996, the Secretary shall issue regulations to implement the
conservation reserve and wetlands reserve programs established
under chapter 1 of subtitle D.
(f) Partnerships and Cooperation.--
(1) In general.--In carrying out any program under
subtitle D, the Secretary may designate special
projects, as recommended by the State Conservationist,
after consultation with the State technical committee,
to enhance technical and financial assistance provided
to owners, operators, and producers to address
environmental issues affected by agricultural production
with respect to--
(A) meeting the purposes of--
(i) the Federal Water Pollution
Control Act (33 U.S.C. 1251 et seq.) or
comparable State laws in impaired or
threatened watersheds;
(ii) the Safe Drinking Water Act (42
U.S.C. 300f et seq.) or comparable
State laws in watersheds providing
water for drinking water supplies; or
(iii) the Clean Air Act (42 U.S.C.
7401 et seq.) or comparable State laws;
or
(B) watersheds of special significance or
other geographic areas of environmental
sensitivity, such as wetland, including State
or multi-State projects--
(i) to facilitate surface and ground
water conservation;
(ii) to protect water quality;
(iii) to protect endangered or
threatened species or habitat, such as
conservation corridors;
(iv) to improve methods of
irrigation;
(v) to convert acreage from irrigated
production; or
(vi) to reduce nutrient loads of
watersheds.''.
(2) Incentives.--To realize the purposes of the
special projects under paragraph (1), the Secretary may
provide incentives to owners, operators, and producers
participating in the special projects to encourage
partnerships and sharing of technical and financial
resources among owners, operators, and producers and
among owners, operators, and producers and governmental
and nongovernmental organizations.
(3) Flexibility.--
(A) In general.--The Secretary may enter into
agreements with States (including State
agencies and units of local government) and
nongovernmental organizations to allow greater
flexibility to adjust the application of
eligibility criteria, approved practices,
innovative conservation practices, and other
elements of the programs under this title to
better reflect unique local circumstances and
purposes in a manner that is consistent with--
(i) environmental enhancement and
long-term sustainability of the natural
resource base; and
(ii) the purposes of this title.
(B) Plan.--Each party to an agreement under
subparagraph (A) shall submit to the Secretary,
for approval by the Secretary, a special
project area or priority area program plan for
each program to be carried out by the party
that includes--
(i) a description of the proposed
adjustments to program implementation
(including a description of how those
adjustments will accelerate the
achievement of environmental benefits);
(ii) an analysis of the contribution
those adjustments will make to the
effectiveness of programs in achieving
the purposes of the special project or
priority area program;
(iii) a timetable for reevaluating
the need for or performance of the
proposed adjustments;
(iv) a description of non-Federal
programs and resources that will
contribute to achieving the purposes of
the special project or priority area
program; and
(v) a plan for regular monitoring,
evaluation, and reporting of progress
toward the purposes of the special
project or priority area program.
(4) Funding for special projects.--The Secretary may
carry out special projects, the purposes of which are
to encourage--
(A) producers to cooperate in the
installation and maintenance of conservation
systems that affect multiple agricultural
operations;
(B) the sharing of information and technical
and financial resources;
(C) cumulative environmental benefits across
operations ofproducers; and
(D) the development and demonstration of
innovative conservation methods.
(5) Funding.--
(A) In general.--Subject to subparagraph (B),
the Secretary shall use 5 percent of the funds
made available for each fiscal year under
section 1241(b) to carry out activities that
are authorized under the environmental quality
incentives program established under chapter 4
of subtitle D.
(B) Unused funding.--Any funds made available
for a fiscal year under subparagraph (A) that
are not obligated by June 1 of the fiscal year
may be used to carry out other activities under
the environmental quality incentives program
during the fiscal year in which the funding
becomes available.
SEC. 1244. ADMINISTRATIVE REQUIREMENTS FOR CONSERVATION PROGRAMS.
(a) Good Faith Reliance.--
(1) In general.--Notwithstanding any other provision
of law, except as provided in paragraph (4), the
Secretary shall provide equitable relief to an owner,
operator, or producer that has entered into a contract
under a conservation program administered by the
Secretary, and that is subsequently determined to be in
violation of the contract, if the owner, operator, or
producer, in attempting to comply with the terms of the
contract and enrollment requirements--
(A) took actions in good faith reliance on
the action or advice of an employee of the
Secretary; and
(B) had no knowledge that the actions taken
were in violation of the contract.
(2) Types of relief.--The Secretary shall--
(A) to the extent the Secretary determines
that an owner, operator, or producer has been
injured by good faith reliance described in
paragraph (1), allow the owner, operator, or
producer--
(i) to retain payments received under
the contract;
(ii) to continue to receive payments
under the contract;
(iii) to keep all or part of the land
covered by the contract enrolled in the
applicable program;
(iv) to reenroll all or part of the
land covered by the contract in the
applicable program; or
(v) to receive any other equitable
relief the Secretary considers
appropriate; and
(B) require the owner, operator, or producer
to take such actions as are necessary to remedy
any failure to comply with the contract.
(3) Relationship to other law.--The authority to
provide relief under this subsection shall be in
addition to any other authority provided in this or any
other Act.
(4) Exceptions.--This section shall not apply to--
(A) any pattern of conduct in which an
employee of the Secretary takes actions or
provides advice with respect to an owner,
operator, or producer that the employee and the
owner, operator, or producer know are
inconsistent with applicable law (including
regulations); or
(B) an owner, operator, or producer takes any
action, independent of any advice or
authorization provided by an employee of the
Secretary, that the owner, operator, or
producer knows or should have known to be
inconsistent with applicable law (including
regulations).
(5) Applicability of relief.--Relief under this
section shall be available for contracts in effect on
or after the date of enactment of this section.
(b) Education, Outreach, Monitoring, and Evaluation.--In
carrying out any conservation program administered by the
Secretary, the Secretary--
(1) shall provide education, outreach, training,
monitoring, evaluation, technical assistance, and
related services to agricultural producers (socially
disadvantaged agricultural producers, beginning farmers
and ranchers, Indian tribes (as those terms are
defined in section 1238), and limited resource
agricultural producers);
(2) may enter into contracts with States (including
State agencies and units of local government), private
nonprofit, community-based organizations, and
educational institutions with demonstrated experience
in providing the services described in paragraph (1),
to provide those services; and
(3) shall use such sums as are necessary from funds
of the Commodity Credit Corporation to carry out
activities described in paragraphs (1) and (2).
(c) Beginning Farmers and Ranchers and Indian Tribes.--In
carrying out any conservation program administered by the
Secretary, the Secretary may provide to beginning farmers and
ranchers and Indian tribes (as those terms are defined in
section 1238) and limited resource agricultural producers
incentives to participate in the conservation program to--
(1) foster new farming opportunities; and
(2) enhance environmental stewardship over the long
term.
(d) Program Evaluation.--The Secretary shall maintain data
concerning conservation security plans, conservation practices
planned or implemented, environmental outcomes, economic costs,
and related matters under conservation programs administered by
the Secretary.
(e) Mediation and Informal Hearings.--If the Secretary
makes a decision under a conservation program administered by
the Secretary that is adverse to an owner, operator, or
producer, at the request of the owner, operator, or producer,
the Secretary shall provide the owner, operator, or producer
with mediation services or an informal hearing on the decision.
(f) Technical Assistance.--
(1) In general.--Under any conservation program
administered by the Secretary, subject to paragraph
(2), technical assistance provided by persons certified
under paragraph (3) (including farmers and ranchers)
may include--
(A) conservation planning;
(B) design, installation, and certification
of conservation practices;
(C) conservation training for producers; and
(D) such other conservation activities as the
Secretary determines to be appropriate.
(2) Outside assistance.--
(A) In general.--The Secretary may contract
directly with qualified persons not employed by
the Department to provide conservation
technical assistance.
(B) Payment by secretary.--Subject to
subparagraph (C), the Secretary may provide a
payment to an owner, operator, or producer
enrolled in a conservation program administered
by the Secretary if the owner, operator, or
producer elects to obtain technical assistance
from a person certified to provide technical
assistance under this subsection.
(C) Nonprivate providers.--In determining
whether to provide a payment under subparagraph
(B) to a nonprivate provider, the Secretary
shall provide a payment if the provision of the
payment would result in an increase in the
total amount of technical assistance available
to producers, as determined by the Secretary.
(3) Certification of providers of technical
assistance.--
(A) Procedures.--
(i) In general.--The Secretary shall
establish procedures for certifying
persons not employed by the Department
to provide technical assistance in
planning, designing, or certifying
activities to participate in any
conservation program administered by
the Secretary to agricultural producers
and landowners participating, or
seeking to participate, in conservation
programs administered by the Secretary.
(ii) Non-federal assistance.--The
Secretary may request the services of,
and enter into a cooperative agreement
with, a State water quality agency,
State fish and wildlife agency, State
forestry agency, or any other
governmental or nongovernmental
organization or person considered
appropriate to assist in providing the
technical assistance necessary to
develop and implement conservation
plans under this title.
(B) Standards.--The Secretary shall establish
standards for the conduct of--
(i) the certification process
conducted by the Secretary; and
(ii) periodic recertification by the
Secretary of providers.
(C) Certification required.--
(i) In general.--A provider may not
provide to any producer technical
assistance described in paragraph
(3)(A)(i) unless the provider is
certified by the Secretary.
(ii) Waiver.--The Secretary may
exempt a provider from any requirement
of this subparagraph if the Secretary
determines that the provider has been
certified or recertified to provide
technical assistance through a program
the standards of which meet or exceed
standards established by the Secretary
under subparagraph (B).
(D) Fee.--
(i) In general.--In exchange for
certification or recertification, a
provider shall pay a fee to the
Secretary in an amount determined by
the Secretary.
(ii) Account.--A fee paid to the
Secretary under clause (i) shall be--
(I) credited to the account
in the Treasury that incurs
costs relating to implementing
this subsection; and
(II) made available to the
Secretary for use for
conservation programs
administered by the Secretary,
without further appropriation,
until expended.
(iii) Waiver.--The Secretary may
waive any requirement of any provider
to pay a fee under this subparagraph if
the provider qualifies for a waiver
under subparagraph (C)(ii).
(E) Other requirements.--The Secretary may
establish such other requirements as the
Secretary determines are necessary to carry out
this subsection.
(g) Privacy of Personal Information Relating to Natural
Resources Conservation Programs.--
(1) Information received for technical and financial
assistance.--
(A) In general.--In accordance with section
1770 and section 552(b)(3) of title 5, United
States Code, except as provided in subparagraph
(C) and paragraph (3), information described in
subparagraph (B)--
(i) shall not be considered to be
public information; and
(ii) shall not be released to any
person or Federal, State, local agency
or Indian tribe (as defined in section
1238) outside the Department of
Agriculture.
(B) Information.--The information referred to
in subparagraph (A) is information--
(i) provided to, or developed by, the
Secretary (including a contractor of
the Secretary) for the purpose of
providing technical or financial
assistance to an owner, operator, or
producer with respect to any natural
resources conservation program
administered by the Natural Resources
Conservation Service or the Farm
Service Agency; and
(ii) that is proprietary to the
agricultural operation or land that is
a part of an agricultural operation of
the owner, operator, or producer.
(C) Exception.--Information compiled by the
Secretary, such as a list of owners, operators,
or producers that have received payments from
the Secretary and the amounts received, shall
be--
(i) considered to be public
information; and
(ii) may be released to any--
(I) person;
(II) Indian tribe (as defined
in section 1238); or
(III) Federal, State, local
agency outside the Department
of Agriculture.
(2) Inventory, monitoring, and site specific
information.--Except as provided in paragraph (3) and
notwithstanding any other provision of law, in order to
maintain the personal privacy, confidentiality, and
cooperation of owners, operators, and producers, and to
maintain the integrity of sample sites, the specific
geographic locations of data gathering sites of the
National Resources Inventory of the Department of
Agriculture, and the information generated by
those sites--
(A) shall not be considered to be public
information; and
(B) shall not be released to any person or
Federal, State, local, or tribal agency outside
the Department.
(3) Exceptions.--
(A) Release and disclosure for enforcement.--
The Secretary may release or disclose to the
Attorney General information covered by
paragraph (1) or (2) to the extent necessary to
enforce the natural resources conservation
programs referred to in paragraph (1).
(B) Disclosure to cooperating persons and
agencies.--
(i) In general.--The Secretary may
release or disclose information covered
by paragraph (1) or (2) to a person or
Federal, State, local, or tribal agency
working in cooperation with the
Secretary in providing technical and
financial assistance described in
paragraph (1) or collecting information
from National Resources Inventory data
gathering sites.
(ii) Use of information.--The person
or Federal, State, local, or tribal
agency that receives information
described in clause (i) may release the
information only for the purpose of
assisting the Secretary--
(I) in providing the
requested technical or
financial assistance; or
(II) in collecting
information from National
Resources Inventory data
gathering sites.
(C) Statistical and aggregate information.--
Information covered by paragraph (1) or (2) may
be disclosed to the public if the information
has been transformed into a statistical or
aggregate form that does not allow the
identification of any--
(i) individual owner, operator, or
producer; or
(ii) specific data gathering site.
(D) Consent of owner, operator, or
producer.--
(i) In general.--An owner, operator,
or producer may consent to the
disclosure of information described in
paragraph (1) or (2).
(ii) Condition of other programs.--
The participation of the owner,
operator, or producer in, and the
receipt of any benefit by the owner,
operator, or producer under, this title
or any other program administered by
the Secretary may not be conditioned on
the owner, operator, or producer
providing consent under this paragraph.
(4) Violations; penalties.--Section 1770(c) shall
apply with respect to the release of information
collected in any manner or for any purpose prohibited
by this subsection.
(h) Indian Tribes.--In carrying out any conservation
program administered by the Secretary on land under the
jurisdiction of an Indian tribe (as defined in section 1238),
the Secretary shall cooperate with the tribal government of the
Indian tribe to ensure, to the maximum extent practicable, that
the program is administered in a fair and equitable manner.
* * * * * * *
[Subtitle G--State Technical Committees]
Subtitle G--State Technical Committees
SEC. 1261. ESTABLISHMENT.
(a) In General.--The Secretary shall establish in each
State a technical committee to assist the Secretary in the
technical considerations relating to implementation of any
private land conservation program administered by the
Secretary.
(b) Standards.--Not later than 180 days after the date of
enactment of the Agriculture, Conservation, and Rural
Enhancement Act of 2001, the Secretary shall develop standards
to be used by each State technical committee in the development
of technical guidelines under section 1262(b) for the
implementation of the conservation programs under this title.
(c) Composition.--Each State technical committee
established under subsection (a) shall be composed of
professional resource managers that represent a variety of
disciplines in the soil, water, wetland, forest, and wildlife
sciences, including representatives from among--
(1) the Natural Resources Conservation Service (a
representative of which shall serve as Chair of the
Committee);
(2) the Farm Service Agency;
(3) the Forest Service;
(4) the Extension Service;
(5) the Fish and Wildlife Service;
(6) such State departments and agencies as the
Secretary determines to be appropriate, including--
(A) a State fish and wildlife agency;
(B) a State forester or equivalent State
official;
(C) a State water resources agency;
(D) a State department of agriculture;
(E) a State soil conservation agency;
(F) a State association of soil and water
conservation districts; and
(G) land grant colleges and universities;
(7) other individuals or agency personnel with
expertise in soil, water, wetland, and wildlife or
forest management as the Secretary determines to be
appropriate;
(8) agricultural producers with demonstrable
conservation expertise;
(9) nonprofit organizations with demonstrable
conservation or forestry expertise;
(10) persons knowledgeable about conservation or
forestry techniques; and
(11) agribusinesses.
SEC. 1262. RESPONSIBILITIES.
(a) Information.--
(1) Provision.--
(A) In general.--Each State technical
committee established under section 1261 shall
meet regularly to provide information,
analyses, and recommendations to the Secretary.
(B) Manner; form.--Information, analyses, and
recommendations described in subparagraph (A)
shall--
(i) be provided in writing, in a
manner that assists the Secretary in
determining matters of fact, technical
merit, or scientific question; and (ii)
reflect the best professional
information and judgment of the
committee.
(2) Coordination.--The Secretary shall coordinate
activities conducted under this section with activities
conducted under section 1628 of the Food, Agriculture,
Conservation, and Trade Act of 1990 (7 U.S.C. 5831).
(3) Public participation.--Each State technical
committee shall--
(A) provide public notice of, and permit
public attendance at, meetings considering
issues of concern related to any program under
this title; and
(B) distribute meeting minutes to each person
attending a meeting described in subparagraph
(A).
(4) Communication.--Each State conservationist shall
communicate regularly with members of the State
technical committee concerning status of action on
recommendations of the committee.
(b) Other Duties.--Each State technical committee shall
provide assistance and offer recommendations with respect to
the technical aspects of--
(1) wetland protection, restoration, and mitigation
requirements;
(2) criteria to be used in evaluating bids for
enrollment of environmentally-sensitive land in the
conservation reserve program established under
subchapter B of chapter 1;
(3) guidelines for haying or grazing and the control
of weeds to protect nesting wildlife on designated
acreage relating to--
(A) highly erodible land conservation under
subtitle B;
(B) wetland conservation under subtitle C; or
(C) other conservation requirements
(4) addressing common weed and pest problems and
programs to control weeds and pests found on acreage
enrolled in the conservation reserve program;
(5) guidelines for planting perennial cover for water
quality and wildlife habitat improvement on designated
land;
(6) establishing criteria and priorities for State
initiatives under the environmental quality incentives
program under chapter 4 of subtitle D;
(7) establishing State and local conservation
priorities under the conservation security program
under subchapter A of chapter 2 of subtitle D;
(8) establishing and maintaining natural resource
indicators and conservation program monitoring and
evaluation systems;
(9) developing conservation program education and
outreach activities;
(10) evaluating innovative practices and systems
under consideration for inclusion in the field office
technical guides; and
(11) other matters, as determined to be appropriate
by the Secretary.
(c) Authority.--
(1) In general.--Each State technical committee
established under section 1261 shall--
(A) serve in an advisory capacity; and
(B) have no implementation or enforcement
authority.
(2) Consideration by secretary.--In carrying out any
program under this title, the Secretary shall give
strong consideration to the recommendations of a State
technical committee (including factual, technical, or
scientific findings and recommendations relating to
areas in which the State technical committee bears
responsibility).
(d) FACA Requirements.--A State technical committee
established under section 1261 shall be exempt from the Federal
Advisory Committee Act (5 U.S.C. App.).
(e) Advisory Subcommittees.--
(1) In general.--Any State or local work group, task
force, or other advisory body authorized by any Federal
law (including a regulation) to advise the Secretary on
issues that are within the areas of responsibility of a
State technical committee established under section
1261 shall be considered to be a subcommittee of the
State technical committee.
(2) Composition.--A person eligible to serve on a
State technical committee under section 1261(c) shall
also be eligible to serve on 1 or more subcommittees of
a State technical committee.
(3) Local working groups.--A local working group
shall be considered to be a subcommittee of a State
technical committee established under section 1261.''.
* * * * * * *
TITLE 3
PUBLIC LAW 480
* * * * * * *
SEC. 2. UNITED STATES POLICY.
It is the policy of the United States to use its abundant
agricultural productivity to promote the foreign policy of the
United States by enhancing the food security of the developing
world through the use of agricultural commodities and local
currencies accruing under this Act to--
(1) combat world hunger and malnutrition and their
causes;
(2) promote broad-based, equitable, and sustainable
development, including agricultural development and
conflict prevention;
(3) expand international trade;
(4) develop and expand export markets for United
States agricultural commodities; and
(5) foster and encourage the development of private
enterprise and democratic participation in developing
countries.
* * * * * * *
SEC. 202. PROVISION OF AGRICULTURAL COMMODITIES.
(a) Emergency Assistance.--Notwithstanding any other
provision of law, the Administrator may provide agricultural
commodities to meet emergency food needs under this title
through governments and public or private agencies, including
intergovernmental organizations such as the World Food Program
and other multilateral organizations, in such manner and on
such terms and conditions as the Administrator determines
appropriate to respond to the emergency.
(b) Nonemergency Assistance.--
(1) In general.--The Administrator may provide
agricultural commodities for nonemergency assistance
under this title through eligible organizations (as
described in subsection (d)) that have entered into an
agreement with the Administrator to use the commodities
in accordance with this title.
(2) Limitation.--The Administrator may not deny a
request for funds submitted under this subsection
because the program for which the funds are requested--
(A) would be carried out by the eligible
organization in a foreign country in which the
Agency for International Development does not
have a mission, office, or other presence; or
(B) is not part of a development plan for the
country prepared by the Agency.
(3) Program diversity.--The Administrator shall--
(A) encourage eligible organizations to
propose and implement program plans to address
1 or more aspects of the program under section
201; and
(B) consider proposals that incorporate a
variety of program objectives and strategic
plans based on the identification by eligible
organizations of appropriate activities to
assist development in foreign countries.
(c) Uses of Assistance.--Agricultural commodities provided
under this title may be made available for direct distribution,
sale, barter, or other appropriate disposition.
(d) Eligible Organizations.--To be eligible to receive
assistance under subsection (b) an organization shall be--
(1) a private voluntary organization or cooperative
that is, to the extent practicable, registered with the
Administrator; or
(2) an intergovernmental organization, such as the
World Food Program.
(e) Support for Eligible Organizations.--
(1) In general.--Of the funds made available in each
fiscal year under this title to the Administrat, or,
[not less than $10,000,000 and not more than
$28,000,000,] not less than 5 percent nor more than 10
percent of the funds shall be made available in each
fiscal year to eligible organizations described in
subsection (d), to assist the organizations in--
(h) Certified Institutional Partners.--
(1) In general.--The Administrator or the Secretary,
as applicable, shall promulgate regulations and issue
guidelines to permit private voluntary organizations
and cooperatives to be certified as institutional
partners.
(2) Requirements.--To become a certified
institutional partner, a private voluntary organization
or cooperative shall submit to the Administrator a
certification of organizational capacity that
describes--
(A) the financial, programmatic, commodity
management, and auditing abilities and
practices of the organization or cooperative;
and
(B) the capacity of the organization or
cooperative to carry out projects in particular
countries.
(3) Multi-country proposals.--A certified
institutional partner shall be eligible to--
(A) submit a single proposal for 1 or more
countries that are the same as, or similar to,
those countries in which the certified
institutional partner has already demonstrated
organizational capacity;
(B) receive expedited review and approval of
the proposal; and
(C) receive commodities and assistance under
this section for use in 1 or more countries.
SEC. 203. GENERATION AND USE OF [FOREIGN] CURRENCIES BY PRIVATE
VOLUNTARY ORGANIZATIONS AND COOPERATIVES.
(a) Local Sale and Barter of Commodities.--An agreement
entered into between the Administrator and a private voluntary
organization or cooperative to provide food assistance through
such organization or cooperative under this title may provide
for the sale or barter in [the recipient country, or in a
country] 1 or more recipient countries, or 1 or more countries
in the same region, of the commodities to be provided under
such agreement.
(b) Minimum Level of Local Sales.--In carrying out
agreements of the type referred to in subsection (a), the
Administrator shall permit private voluntary organizations and
cooperatives to sell, [in recipient countries, or in countries]
1 or more recipient countries, or in 1 or more countries in the
same region, an amount of commodities equal to not less than 15
percent of the aggregate amounts of all commodities distributed
under non-emergency programs under this title for each fiscal
year, to generate [foreign currency] proceeds to be used as
provided in this section.
(c) Description of Intended Uses.--A private voluntary
organization or cooperative submitting a proposal to enter into
a non-emergency food assistance agreement under this title
shall include in such proposal a description of the intended
uses of any [foreign currency] proceeds that may be generated
through the sale, in [the recipient country, or in a country
in] 1 or more recipient countries, or in 1 or more countries in
the same region, of any commodities provided under an agreement
entered into between the Administrator and the organization or
cooperative.
(d) Use.--[Foreign currencies] Proceeds generated from any
partial or full sale or barter of commodities by a private
voluntary organization or cooperative under a non-emergency
food assistance agreement under this title may--
(1) be used to transport, store, distribute, and
otherwise enhance the effectiveness of the use of
agricultural commodities provided under this title;
(2) be used to implement [income generating] income-
generating, community development, health, nutrition,
cooperative development, agricultural, and other
developmental activities within [the recipient country
or within a country] 1 or more recipient countries or
within 1 or more countries in the same region; or
(3) be invested, and any interest earned on such
investment may be used, for the purposes for which the
assistance was provided to that organization, without
further appropriation by Congress.
SEC. 204. LEVELS OF ASSISTANCE.
(a) Minimum Levels.--
(1) Minimum assistance.--Except as provided in
paragraph (3), the Administrator shall make
agricultural commodities available for food
distribution under this title in an amount [that for
each of fiscal years 1996 through 2002 is not less than
2,025,000 metric tons] that is not less than--
(A) 2,100.000 metric tons for fiscal year
2002;
(B) 2,200,000 metric tons for fiscal year
2003;
(C) 2,300,000 metric tons for fiscal year
2004;
(D) 2,400,000 metric tons for fiscal year
2005;
(E) 2, 500,000 metric tons for fiscal year
2006.
(2) Minimum non-emergency assistance.--Of the amounts
specified in paragraph (1), and except as provided in
paragraph (3), the Administrator shall make
agricultural commodities available for non-emergency
food distribution through eligible organizations under
section 202 in an amount that for each of fiscal years
1996 through 2002 is not less than 1,550,000 metric
tons.
* * * * * * *
(b) Use of Value-Added Commodities.--
(1) Minimum levels.--Except as provided in paragraph
(2), in making agricultural commodities available under
this title, the Administrator shall ensure that not
less than 75 percent of the quantity of such
commodities required to be distributed during each
fiscal year under subsection (a)(2) be in the form of
processed, fortified, or bagged commodities including
crude degummed soybean oil and that not less than 50
percent of the quantity of the bagged commodities
that are whole grain commodities be bagged in the
United States.
(2) Waiver of minimum.--The Administrator may waive
the requirement of paragraph (1) for any fiscal year in
which the Administrator determines that the
requirements of the programs established under this
title will not be best served by the enforcement of
such requirement under such paragraph.
SEC. 205. FOOD AID CONSULTATIVE GROUP.
(a) Establishment.--There is established a Food Aid
Consultative Group (hereinafter referred to in this section as
the ``Group'') that shall meet regularly to review and address
issues concerning the effectiveness of the regulations
policies, guidelines, and procedures that govern food
assistance programs established and implemented under this
title, and the implementation of other provisions of this title
that may involve eligible organizations described in section
202(d)(1).
* * * * * * *
(d) Consultations.--In preparing regulations, handbooks, or
guidelines implementing this title, or significant revisions
thereto, the Administrator shall provide such proposals to the
Group for review and comment. The Administrator shall consult
and, when appropriate (but at least twice per year), meet with
the Group regarding such proposed regulations policies,
handbooks, guidelines, or revisions thereto prior to the
issuance of such.
(e) Advisory Committee Act.--The Federal Advisory Committee
Act (5 U.S.C. App.) shall not apply to the Group.
(f) Termination.--The Group shall terminate on December 31,
[2002] 2006.
* * * * * * *
SEC. 206. MAXIMUM LEVEL OF EXPENDITURES.
(a) Maximum Expenditures.--Except as provided in subsection
(b), programs of assistance shall not be undertaken under this
title during any fiscal year if such programs necessitate an
appropriation of more than [$1,000,000,000] $2,000,000,000 to
reimburse the Commodity Credit Corporation for all costs
incurred in connection with such programs (including the
Corporation''s investment in commodities made available).
(b) Waiver by President.--The President may waive the
limitation contained in subsection (a) if the President
determines that such waiver is necessary to undertake programs
of assistance to meet urgent humanitarian or emergency needs.
SEC. 207. ADMINISTRATION.
(a) Proposals.--
[(1) Time for decision.--Not later than 45 days after
the receipt by the Administrator of a proposal
submitted]
(1) Recipient countries.--A proposal to enter into a
nonemergency food assistance agreement under this title
shall identify the recipient country or countries that
are the subject of the agreement.
(2) Timing.--Not later than 120 days after the date
of submission to the Administrator of a proposal
submitted by an eligible organization under this title,
the Administrator shall determine whether to accept the
proposal.
(A) by an eligible organization, with the
concurrence of the appropriate United States
field mission, for commodities; or
(B) by a United States field mission to make
commodities available to an eligible
organization; under this title, the
Administrator shall make a decision concerning
such proposal.
(3) Denial.--If a proposal under paragraph (1) is
denied, the response shall specify the reasons for
denial and the conditions that must be met for the
approval of such proposal.
(b) Notice and Comment.--Not later than 30 days prior to
the issuance of a final [guideline] guideline or policy
determination to carry out this title, the Administrator
shall--
(1) provide notice of the existence of a proposed
[guideline] guideline or policy determination, and that
such [guideline] guideline or policy determination is
available for review and comment, to eligible
organizations that participate in programs under this
title, and to other interested persons;
(2) make the proposed [guideline] guideline or policy
determination available, on request, to the eligible
organizations and other persons referred to in
paragraph (1); and
(3) take any comments received into consideration
prior to the issuance of the final [guideline]
guideline or policy determination.
(c) Regulations.--
(1) In general.--The Administrator shall promptly
issue all necessary regulations and make revisions to
agency guidelines with respect to changes in the
operation or implementation of the program established
under this title.
(2) Requirements.--The Administrator shall develop
regulations with the intent of--
(A) simplifying procedures for participation
in the programs established under this title;
(B) reducing paperwork requirements under
such programs;
(C) establishing reasonable and realistic
accountability standards to be applied to
eligible organizations participating in the
programs established under this title, taking
into consideration the problems associated with
carrying out programs in developing countries;
and
(D) providing flexibility for carrying out
programs under this title.
(3) Handbooks.--Handbooks developed by the
Administrator to assist in carrying out the program
under this title shall be designed to foster the
development of programs under this title by eligible
organizations.
(d) Deadline for Submission of Commodity Orders.--Not later
than 15 days after receipt from a [United States field mission]
an eligible organization with an approved program under this
title of a call forward for agricultural commodities for
programs that meet the requirements of this title, the order
for the purchase or the supply, from inventory, of such
commodities or products shall be transmitted to the Commodity
Credit Corporation.
(e) Timely Approval.--
(1) In general.--The Administrator shall finalize
program agreements and resource requests for programs
under this section before the beginning of each fiscal
year.
(2) Report.--Not later than December 1 of each year,
the Administrator shall submit to the Committee on
Agriculture and the Committee on International
Relations of the House of Representatives and the
Committee on Agriculture, Nutrition, and Forestry of
the Senate a report that contains--
(A) a list of programs, countries, and
commodities approved to date for assistance
under this section; and
(B) a statement of the total amount of funds
approved to date for transportation and
administrative costs under this section.
(f) Direct Delivery.--In addition to practices in effect on
the date of enactment of this subsection, the Secretary may
approve an agreement that provides for direct delivery of
agricultural commodities to milling or processing facilities
more than 50 percent of the interest in which is owned by
United States citizens in foreign countries, with the proceeds
of transactions transferred in cash to eligible organizations
described in section 202(d) to carry out approved projects.
* * * * * * *
SEC. 208. ASSISTANCE FOR STOCKPILING AND RAPID TRANSPORTATION,
DELIVERY, AND DISTRIBUTION OF SHELF-STABLE
PREPACKAGED FOODS.
* * * * * * *
(e) Regulations or Guidelines.--Not later than 180 days
after the date of the enactment of this section, the
Administrator, in consultation with the Secretary, shall issue
such regulations or guidelines as the Administrator determines
to be necessary to carry out this section, including
regulations or guidelines that provide to United States
nonprofit organizations eligible to receive grants under
subsection (a)(1) guidance with respect to the requirements for
qualified shelf-stable prepackaged foods and the quantity of
the foods to be stockpiled by the organizations.
(f) Authorization of Appropriations.--There is authorized
to be appropriated to the Administrator to carry out this
section, in addition to amounts otherwise available to carry
out this section, $3,000,000 for each of fiscal years 2001 [and
2002] through 2006, to remain available until expended.
* * * * * * *
TITLE III--FOOD FOR DEVELOPMENT
SEC. 403. GENERAL PROVISIONS.
(l) Sale Procedure.--
(1) In general.--Subsections (b) shall apply to sales
of commodities in recipient countries to generate
proceeds to carry out projects under--
(A) section 416(b) of the Agricultural Act of
1949 (7 U.S.C. 1431(b)); and
(B) title VIII of the Agricultural Trade Act
of 1978
(2) Currencies.--Sales of commodities described in
paragraph (1) may be in United States dollars or in a
different currency.
(3) Sale price.--Sales of commodities described in
paragraph (1) shall be made at a reasonable market
prices in the economy where the commodity is to be
sold, as determined by the Secretary or the
Administrator, as appropriate.
(a) Prohibition.--No agricultural commodity shall be made
available under this Act unless it is determined that--
* * * * * * *
SEC. 408. EXPIRATION DATE.
No agreements to finance sales or to provide other
assistance under this Act shall be entered into after December
31, [2002] 2006.
* * * * * * *
SEC. 415. MICRONUTRIENT FORTIFICATION PILOT PROGRAM.
(a) In General.--Subject to the availability of practical
technology and to cost effectiveness, not later than September
30, 1997, the Secretary, in consultation with the
Administrator, shall establish [a micronutrient fortification
pilot program] micronutrient fortification programs under this
Act. The purpose of [the program] a program shall be to--
(1) assist developing countries in correcting
micronutrient dietary deficiencies among segments of
the populations of the countries; and
(2) encourage the development of technologies for the
fortification of [whole] grains and other commodities
that are readily transferable to developing countries
[.]; and
(3) encourage technologies and systems for the
improved quality and safety of fortified grains and
other commodities that are readily transferable to
developing countries.
(b) Selection of Participating Countries.--From among the
countries eligible for assistance under this Act, the Secretary
may select not more than 5 developing countries to participate
in the pilot program.
(c) Fortification.--Under [the pilot program, whole] a
program, grains and other commodities made available to a
developing country selected to participate in [the pilot
program may] a program may be fortified with 1 or more
micronutrients ([including] such as vitamin A, iron, and
iodine) with respect to which a substantial portion of the
population in the country is deficient. The commodity may be
fortified in the United States or in the developing country.
(d) Termination of Authority.--The authority to carry out
the pilot program established under this section shall
terminate on September 30, [2002] 2002.
* * * * * * *
CARGO PREFERENCE LAWS
* * * * * * *
FOOD, AGRICULTURE, CONSERVATION, AND TRADE ACT OF 1990
(g) Biotechnology and Agricultural Trade Program.--
(1) In general.--The Secretary of Agriculture shall
establish a program to enhance foreign acceptance of
agricultural biotechnology and United States
agricultural products developed through biotechnology.
(2) Focus.--The program shall address the continuing
and increasing market access, regulatory, and marketing
issues relating to export commerce of United States
agricultural biotechnology products.
(3) Education and outreach.--
(A) Foreign markets.--Support for United
States agricultural market development
organizations to carry out education and other
outreach efforts concerning biotechnology shall
target such educational initiatives directed
toward--
(i) producers, buyers, consumers, and
media in foreign markets through
initiatives in foreign markets; and
(ii) government officials,
scientists, and trade officials from
foreign countries through exchange
programs.
(B) Funding for education and outreach.--
Funding for activities under subparagraph (A)
may be--
(i) used through--
(I) the emerging markets
program under this section; or
(II) the Cochran Fellowship
Program under section 1543; or
(ii) applied directly to foreign
market development cooperators through
the foreign market development
cooperator program established under
section 702.
(4) Rapid response.--
(A) In general.--The Secretary shall assist
exporters of United States agricultural
commodities in cases in which the exporters are
harmed by unwarranted and arbitrary barriers to
trade due to--
(i) marketing of biotechnology
products;
(ii) food safety;
(iii) disease; or
(iv) other sanitary or phytosanitary
concerns.
(B) Authorization of appropriations.--There
is authorized to be appropriated to carry out
this paragraph $1,000,000 for each of fiscal
years 2002 through 2006.
(5) Funding.--
(A) Commodity credit corporation.--The
Secretary shall use the funds, facilities, and
authorities of the Commodity Credit Corporation
to carry out this subsection (other than
paragraph (4)).
(B) Funding amount.--Of the funds of the
Commodity Credit Corporation, the Secretary
shall make available to carry out this
subsection (other than paragraph (4))
$15,000,000 for each of fiscal years 2002
through 2006.
* * * * * * *
AGRICULTURAL TRADE ACT OF 1978
* * * * * * *
TITLE VIII--FOOD FOR PROGRESS AND EDUCATION PROGRAMS
SEC. 801. DEFINITIONS.
In this title:
(1) Cooperative.--The term ``cooperative'' means a
private sector organization the members of which--
(A) own and control the organization;
(B) share in the profits of the organization;
and
(C) are provided services (such as business
services and outreach in cooperative
development) by the organization.
(2) Corporation.--The term ``Corporation'' means the
Commodity Credit Corporation.
(3) Developing country.--The term ``developing
country'' means a foreign country that has--
(A) a shortage of foreign exchange earnings;
and
(B) difficulty meeting all of the food needs
of the country through commercial channels and
domestic production.
(4) Eligible commodity.--The term ``eligible
commodity'' means an agricultural commodity (including
vitamins and minerals) acquired by the Secretary or the
Corporation for disposition in a program authorized
under this title through--
(A) commercial purchases; or
(B) inventories of the Corporation.
(5) Eligible organization.--the term ``eligible
organization'' means a private voluntary organization,
cooperative, nongovernmental organization, or foreign
country as determined by the Secretary.
(6) Emerging agricultural country.--The term
``emerging agricultural country'' means a foreign
country that--
(A) is an emerging democracy; and
(B) has made a commitment to introduce or
expand free enterprise elements in the
agricultural economy of the country.
(7) Food security--.The term ``food security'' means
access by all people at all times to sufficient food
and nutrition for a healthy and productive life.
(8) Nongovernmental organization.--
(A) In general.--The term ``nongovernmental
organization'' means an organization that
operates on a local level to solve development
problems in a foreign country in which the
organization is located.
(B) Exclusion.--The term ``nongovernmental
organization'' does not include an organization
that is primarily an agency or instrumentality
of the government of a foreign country.
(9) Private voluntary organization.--The term
``private voluntary organization'' means a nonprofit,
intergovernmental organization that--
(A) receives--
(i) funds from private sources; and
(ii) voluntary contributions of
funds, staff time, or in-kind support
from the public;
(B) is engaged in or is planning to engage in
nonreligious voluntary, charitable, or
development assistance activities; and
(C) in the case of an organization that is
organized under the laws of the United States
or a State, is an organization in the United
states, means an organization dexcribed in
section 501 (c) (3) of the Internal Revenue
Code of 1986 that is exempt from taxation under
section 501 (a) of that code.
(10) Program.--The term ``program'' means a food or
nutrition assistance or development initiative proposed
by an eligible organization and approved by the
Secretary under this title.
(11) Recipient country.--The term ``recipient
country'' means an emerging agricultural country that
receives assistance under a program.
SEC. 802. FOOD FOR PROGRESS AND EDUCATION PROGRAMS.
(a) In General.--To provide agricultural commodities to
support the introduction or expansion of free trade enterprises
in national economies in recipient countries, and to provide
food or nutrition assistance in recipient countries, the
Secretary shall establish food for progress and education
programs under which the Secretary may enter into agreements
(including multiyear agreements and for programs in more than 1
country) with--
(1) the governments of emerging agricultural
countries;
(2) private voluntary organizations;
(3) nonprofit agricultural organizations and
cooperatives;
(4) nongovernmental organizations; and
(5) other private entities.
(b) Considerations.--In determining whether to enter into
an agreement to establish a program under subsection (a), the
Secretary shall take into consideration whether an emerging
agricultural country is committed to carrying out, or is
carrying out, policies that promote--
(1) economic freedom;
(2) private production of food commodities for
domestic consumption; and
(3) the creation and expansion of efficient domestic
markets for the purchase and sale of those commodities.
(c) International Food for Education and Nutrition
Program.--
(1) In general.--In cooperation with other countries,
the Secretary shall establish an initiative within the
food for progress and education programs under this
title to be known as the ``International Food for
Education and Nutrition Program'', through which the
Secretary may provide to eligible organizations
agricultural commodities and technical and nutritional
assistance in connection with education programs to
improve food security and enhance educational
opportunities for preschool age and primary school age
children in recipient countries.
(2) Agreements.--In carrying out this subsection, the
Secretary--
(A) shall administer the programs under this
subsection in a manner that is consistent with
this title; and
(B) may enter into agreements with eligible
organizations--
(i) to purchase, acquire, and donate
eligible commodities to eligible
organizations to carry out agreements
in recipient countries; and
(ii) to provide technical and
nutritional assistance to carry out
agreements in recipient countries.
(3) Other donor countries.--The Secretary shall
encourage other donor countries, directly or through
eligible organizations--
(A) to donate goods and funds to recipient
countries; and
(B) to provide technical and nutritional
assistance to recipient countries.
(4) Private sector.--The President and the Secretary
are urged to encourage the support and active
involvement of the private sector, foundations, and
other individuals and organizations in programs and
activities assisted under this subsection.
(5) Graduation.--An agreement with an eligible
organization under this subsection shall include
provisions--
(A)(i) to sustain the benefits to the
education, enrollment, and attendance of
children in schools in the targeted communities
when the provision of commodities and
assistance to a recipient country under the
program under this subsection terminates; and
(ii) to estimate the period of time required
until the recipient country or eligible
organization is able to provide sufficient
assistance without additional assistance under
this subsection; or
(B) to provide other long-term benefits to
targeted populations of the recipient country.
(6) Annual report.--The Secretary shall submit to the
Committee on Agriculture of the House of
Representatives and the Committee on Agriculture,
Nutrition, and Forestry of the Senate an annual report
that describes--
(A) the results of the implementation of this
subsection during the year covered by the
report, including the impact on the enrollment,
attendance, and performance of children in
preschools and primary schools targeted under
the program under this subsection; and
(B) the level of commitments by, and the
potential for obtaining additional goods and
assistance from, other countries for subsequent
years.
(d) Terms.--
(1) In general.--The Secretary may provide
agricultural commodities under this title on--
(A) a grant basis; or
(B) subject to paragraph (2), credit terms.
(2) Credit terms.--Payment for agricultural
commodities made available under this title that
arepurchased on credit terms shall be made on the same basis as
payments made under section 103 of the Agricultural Trade Development
and Assistance Act of 1954 (7 U.S.C. 1703).
(3) No effect on domestic programs.--The Secretary
shall not make an agricultural commodity available for
disposition under this section in any amount that will
reduce the amount of the commodity that is
traditionally made available through donations to
domestic feeding programs or agencies, as determined by
the Secretary.
(e) Reports.--Each eligible organization that enters into
an agreement under this title shall submit to the Secretary, at
such time as the Secretary may request, a report containing
such information as the Secretary may request relating to the
use of agricultural commodities and funds provided to the
eligible organization under this title.
(f) Coordination.--To ensure that the provision of
commodities under this section is coordinated with and
complements other foreign assistance provided by the United
States, assistance under this section shall be coordinated
through the mechanism designated by the President to coordinate
assistance under the Agricultural Trade Development and
Assistance Act of 1954 (7 U.S.C. 1691 et seq.).
(g) Quality Assurance.--
(1) In general.--The Secretary shall ensure, to the
maximum extent practicable, that each eligible
organization participating in 1 or more programs under
this section--
(A) uses eligible commodities made available
under this title--
(i) in an effective manner;
(ii) in the areas of greatest need;
and
(iii) in a manner that promotes the
purposes of this title;
(B) in using eligible commodities, assesses
and takes into account the needs of recipient
countries and the target populations of those
countries;
(C) works with recipient countries and
indigenous institutions or groups in recipient
countries to design and carry out mutually
acceptable programs authorized in subsection
(h)(2)(C)(i);
(D) monitors and reports on the distribution
or sale of eligible commodities provided under
this title using methods that, as determined by
the Secretary, facilitate accurate and timely
reporting;
(E) periodically evaluates the effectiveness
of the program of the eligible organization,
including, as applicable, an evaluation of
whether the development or food and nutrition
purposes of the program can be sustained in a
recipient country if the assistance provided to
the recipient country is reduced and eventually
terminated; and
(F) considers means of improving the
operation of the program of the eligible
organization.
(2) Certified institutional partners.--
(A) In general.--The Secretary shall
promulgate regulations and guidelines to permit
private voluntary organizations and
cooperatives to be certified as institutional
partners.
(B) Requirements.--To become a certified
institutional partner, a private voluntary
organization or cooperative shall submit to the
Secretary a certification of organizational
capacity that describes--
(i) the financial, programmatic,
commodity management, and auditing
abilities and practices of the
organization or cooperative; and
(ii) the capacity of the organization
or cooperative to carry out projects in
particular countries.
(C) Multicountry proposals.--A certified
institutional partner shall be eligible to--
(i) submit a single proposal for 1 or
more countries that are the same as, or
similar to, those countries in which
the certified institutional partner has
already demonstrated organizational
capacity;
(ii) receive expedited review and
approval of the proposal; and
(iii) request commodities and
assistance under this section for use
in 1 or more countries.
(D) Multiyear agreements.--In carrying out
this title, on request and subject to the
availability of commodities, the Secretary is
encouraged to approve agreements that provide
for commodities to be made available for
distribution on a multiyear basis, if the
agreements otherwise meet the requirements of
this title.
(h) Transshipment and Resale.--
(1) In general.--The transshipment or resale of an
eligible commodity to a country other than a recipient
country shall be prohibited unless the transshipment or
resale is approved by the Secretary.
(2) Monetization.--
(A) In general.--Subject to subparagraphs (B)
through (D), an eligible commodity provided
under this section may be sold for foreign
currency or United States dollars or bartered
with the approval of the Secretary.
(B) Sale or barter of food assistance.--The
sale or barter of eligible commodities under
this title may be conducted only within (as
determined by the Secretary)--
(i) a recipient country or country
nearby to the recipient country; or
(ii) another country, if
(I) the sale or barter within
the recipient country or
country nearby is not
practicable; and
(II) the sale or barter
within countries other than the
recipient country or country
nearby will not disrupt
commercial markets for the
agricultural commodity
involved.
(C) Humanitarian or development purposes.--
The Secretary may authorize the use of proceeds
or exchanges to reimburse, within a recipient
country or other country in the same region,
the costs incurred by an eligible organization
for--
(i)(I) programs targeted at hunger
and malnutrition; or
(II) development programs involving
food security or education;
(ii) transportation, storage, and
distribution of eligible commodities
provided under this title; and
(iii) administration, sales,
monitoring, and technical assistance.
(D) Exception.--The Secretary shall not
approve the use of proceeds described in
subparagraph (C) to fund any administrative
expenses of a foreign government.
(E) Private sector enhancement.--As
appropriate, the Secretary may provide eligible
commodities under this title in a manner that
uses commodity transactions as a means of
developing in the recipient countries a
competitive private sector that can provide for
the importation, transportation, storage,
marketing, and distribution of commodities.
(i) Displacement of Commercial Sales.--In carrying out this
title, the Secretary shall, to the maximum extent practicable
consistent with the purposes of this title, avoid--
(1) displacing any commercial export sale of United
States agricultural commodities that would otherwise be
made;
(2) disrupting world prices of agricultural
commodities; or
(3) disrupting normal patterns of commercial trade of
agricultural commodities with foreign countries.
(j) Deadline for Program Announcements.--
(1) In general.--Before the beginning of the
applicable fiscal year, the Secretary shall, to the
maximum extent practicable--
(A) make all determinations concerning
program agreements and resource requests for
programs under this title; and
(B) announce those determinations.
(2) Report.--Not later than November 1 of the
applicable fiscal year, the Secretary shall submit to
the Committee on Agriculture of the House of
Representatives and the Committee on Agriculture,
Nutrition, and Forestry of the Senate a list of
programs, countries, and commodities, and the total
amount of funds for transportation and administrative
costs, approved to date under this title.
(k) Military Distribution of Assistance.--
(1) In general.--The Secretary shall ensure, to the
maximum extent practicable, that agricultural
commodities made available under this title are
provided without regard to--
(A) the political affiliation, geographic
location, ethnic, tribal, or religious identity
of the recipient; or
(B) any other extraneous factors, as
determined by the Secretary.
(2) Prohibition on handling of commodities by the
military.--
(A) In general.--Except as provided in
subparagraph (B), the Secretary shall not enter
into an agreement under this title to provide
agricultural commodities if the agreement
requires or permits the distribution, handling,
or allocation of agricultural commodities by
the military forces of any foreign government
or insurgent group.
(B) Exception.--The Secretary may authorize
the distribution, handling, or allocation of
commodities by the military forces of a country
in exceptional circumstances in which--
(i) nonmilitary channels are not
available for distribution, handling,
or allocation;
(ii) the distribution, handling, or
allocation is consistent with paragraph
(1); and
(iii) the Secretary determines that
the distribution, handling, or
allocation is necessary to meet the
emergency health, safety, or
nutritional requirements of the
population of a recipient country.
(3) Encouragement of safe passage.--In entering into
an agreement under this title that involves 1 or more
areas within a recipient country that is experiencing
protracted warfare or civil unrest, the Secretary
shall, to the maximum extent practicable, encourage all
parties to the conflict to--
(A) permit safe passage of the commodities
and other relief supplies; and
(B) establish safe zones for--
(i) medical and humanitarian
treatment; and
(ii) evacuation of injured persons.
(1) Level of Assistance.--The cost of commodities
made available under this title, and the expenses
incurred in connection with the provision of those
commodities shall be in addition to the level of
assistance provided under the Agricultural Trade
Development and Assistance Act of 1954 (7 U.S.C. 1691
et seq.)
(m) Commodity Credit Corporation.--
(1) In general.--Subject to paragraphs (6) through
(8), the Secretary may use the funds, facilities, and
authorities of the Corporation to carry out this title.
(2) Minimum tonnage.--Subject to paragraphs (5) and
(7)(B), not less than 400,000 metric tons of
commodities may be provided under this title for each
of fiscal years 2002 through 2006.
(3) Authorization of appropriations.--In addition to
tonnage authorized under paragraph (2), there are
authorized to be appropriated such sums as are
necessary to carry out this title.
(4) Title i funds.--In addition to tonnage and funds
authorized under paragraphs (2), (3), and (7)(B), the
Corporation may use funds appropriated to carry out
title I of the Agricultural Trade Development and
Assistance Act of 1954 (7 U.S.C. 1701 et seq.)) in
carrying out this section with respect to commodities
made available under this title.
(5) International food for education and nutrition
program.--
(A) In general.--Of the funds that would be
available to carry out paragraph (2), the
Secretary may use not more than $200,000,000
for each fiscal year to carry out the
initiative established under subsection (c).
(B) Reallocation.--Tons not allocated under
subsection (c) by June 30 of each fiscal year
shall be made available for proposals submitted
under the food for progress and education
programs under subsection (a).
(6) Limitation on purchases of commodities.--The
Corporation may purchase agricultural commodities for
disposition under this title only if Corporation
inventories are insufficient to satisfy commitments
made in agreements entered into under this title.
(7) Eligible costs and expenses.--
(A) In general.--Subject to subparagraph (B),
with respect to an eligible commodity made
available under this title, the Corporation may
pay--
(i) the costs of acquiring the
eligible commodity;
(ii) the costs associated with
packaging, enriching, preserving, and
fortifying of the eligible commodity;
(iii) the processing, transportation,
handling, and other incidental costs
incurred before the date on which the
commodity is delivered free on board
vessels in United States ports;
(iv) the vessel freight charges from
United States ports or designated
Canadian transshipment ports, as
determined by the Secretary, to
designated ports of entry abroad;
(v) the costs associated with
transporting the eligible commodity
from United States ports to designated
points of entry abroad in a case in
which--
(I) a recipient country is
landlocked;
(II) ports of a recipient
country cannot be used
effectively because of natural
or other disturbances;
(III) carriers to a specific
country are unavailable; or
(IV) substantial savings in
costs or time may be gained by
the use of points of entry
other than ports;
(vi) the transportation and
associated distribution costs incurred
in moving the commodity (including
repositioned commodities) from
designated points of entry or ports of
entry abroad to storage and
distribution sites;
(vii) in the case of an activity
under subsection (c), the internal
transportation, storage, and handling
costs incurred in moving the eligible
commodity, if the Secretary determines
that payment of the costs is appropriate
and that the recipient country is a low
income, net food-importing country that--
(I) meets the poverty
criteria established by the
International Bank for
Reconstruction and Development
for Civil Works Preference; and
(II) has a national
government that is committed to
or is working toward, through a
national action plan, the World
Declaration on Education for
All convened in 1990 in
Jomtien, Thailand, and the
followup Dakar Framework for
Action of the World Education
Forum in 2000;
(viii) the charges for general
average contributions arising out of
the ocean transport of commodities
transferred; and
(ix) the costs, in addition to costs
authorized by clauses (i) through
(viii), of providing--
(I) assistance in the
administration, sale, and
monitoring of food assistance
activities under this title;
and
(II) technical assistance for
monetization programs.
(B) Funding.--Except for costs described in
subparagraph (A)(i), not more than $80,000,000
of funds that would be made available to carry
out paragraph (2) may be used to cover costs
under this paragraph unless authorized in
advance in an appropriation Act.
(8) Payment of administrative costs.--An eligible
organization that receives payment for administrative
costs through monetization of the eligible commodity
under subsection (h)(2) shall not be eligible to
receive payment for the same administrative costs
through direct payments under paragraph (7)(A)(ix)(I).
* * * * * * *
TITLE I--GENERAL PROVISIONS
SEC. 101. PURPOSE.
It is the purpose of this Act to increase the profitability
of farming and to increase opportunities for United States
farms and agricultural enterprises by--
(1) increasing the effectiveness of the Department of
Agriculture in agricultural export policy formulation
and implementation;
(2) improving the competitiveness of United States
agricultural commodities and products in the world
market; and
(3) providing for the coordination and efficient
implementation of all agricultural export programs.
SEC. 107. EXPORTER ASSISTANCE INITIATIVE.
(a) In General.--In order to create a single source of
information for exports of United States agricultural
commodities, the Secretary shall develop a website on the
Internet that collates onto a single website all information
from all agencies of the Federal Government that is relevant to
the export of United States agricultural commodities.
(b) Authorization of Appropriations.--There are authorized
to be appropriated to carry out subsection (a)--
(1) $1,000,000 for each of fiscal years 2002 through
2004;
(2) $500,000 for each of fiscal years 2005 and 2006.
SEC. 102. DEFINITIONS.
As used in this Act--
(1) Agricultural commodity.--The term ``agricultural
commodity'' means any agricultural commodity, food,
feed, fiber, or livestock (including livestock as it is
defined in section 602(2) of the Agricultural Act of
1949 (7 U.S.C. 1471(2)) and insects) and any product
thereof.
(2) Developing country.--The term ``developing
country'' means a country that--
(A) has a shortage of foreign exchange
earnings and has difficulty accessing
sufficient commercial credit to meet all of its
food needs, as determined by the Secretary; and
(B) has the potential to become a commercial
market for agricultural commodities.
(3) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture.
(4) Service.--The term ``Service'' means the Foreign
Agricultural Service of the Department of Agriculture.
(5) Unfair trade practice.--
(A) In general.--Subject to subparagraph (B),
the term ``unfair trade practice'' means any
act, policy, or practice of a foreign country
that--
(i) violates, or is inconsistent
with, the provisions of, or otherwise
denies benefits to the United States
under, any trade agreement to which the
United States is a party; [or]
(ii) is unjustifiable, unreasonable,
or discriminatory and burdens or
restricts United States commerce[;]
including, in the case of a state
trading enterprise engaged in the
export of an agricultural commodity,
pricing practices that are not
consistent with sound commercial
practices conducted in the ordinary
course of trade; or; and
(iii) changes United States export
terms of trade through a deliberate
change in the dollar exchange rate of a
competing exporter.
(B) Consistency with 1974 trade act.--Nothing
in this Act may be construed to authorize the
Secretary to make any determination regarding
an unfair trade practice that is inconsistent
with section 301 of the Trade Act of 1974 (19
U.S.C. 2411).
* * * * * * *
(k) Processed and High-Value Products.--
(1) In general.--In issuing export credit guarantees
under this section, the Commodity Credit Corporation
shall, subject to paragraph (2), ensure that not less
than 25 percent for each of fiscal years 1996 and 1997,
30 percent for each of fiscal years 1998 and 1999, and
35 percent for each of fiscal years 2000, [2001, and
2002] through 2006, of the total amount of credit
guarantees issued for a fiscal year is issued to
promote the export of processed or high-value
agricultural products and that the balance is issued to
promote the export of bulk or raw agricultural
commodities.
(2) Limitation.--The percentage requirement of
paragraph (1) shall apply for a fiscal year to the
extent that a reduction in the total amount of credit
guarantees issued for the fiscal year is not required
to meet the percentage requirement.
SEC. 203. MARKET ACCESS PROGRAM.
* * * * * * *
(g) Level of Marketing Assistance.--
(1) In general.--The Secretary shall justify in
writing the level of assistance provided to an eligible
trade organization under the program under this section
and the level of cost-sharing required of such
organization.
(2) Limitation.--Assistance provided under this
section for activities described in subsection (e)(4)
shall not exceed 50 percent of the cost of implementing
the marketing plan, except that the Secretary may
determine not to apply such limitation in the case of
agricultural commodities with respect to which there
has been a favorable decision by the United States
Trade Representative under section 301 of the Trade Act
of 1974. Criteria for determining that the limitation
shall not apply shall be consistent and documented.
(3) Staged reduction in assistance.--In the case of
participants that received assistance under section
1124 of the Food Security Act of 1985 prior to November
28, 1990, and with respect to which assistance under
this section would be limited under paragraph (2), any
such reduction in assistance shall be phased down in
equal increments over a 5-year period.
(h) United States Quality Export Initiative.--
(1) In general.--Subject to the availability of
appropriations, using the authorities under this
section, the Secretary shall establish a program under
which, on a competitive basis, using practical and
objective criteria, several agricultural products are
selected to carry the ``U.S. Quality'' seal.
(2) Promotional activities.--Agricultural products
selected under paragraph (1) shall be promoted using
the ``U.S. Quality'' seal at trade fairs in key markets
through electronic and print media.
(3) Authorization of Appropriations.--There are
authorized to be appropriated such sums as are
necessary to carry out this subsection.
SEC. 204. BARTER OF AGRICULTURAL COMMODITIES.
* * * * * * *
SEC. 211. FUNDING LEVELS.
* * * * * * *
(2) Limitation on origination fee.--Notwithstanding
any other provision of law, the Secretary may not
charge an origination fee with respect to any credit
guarantee transaction under section 202(a) in excess of
an amount equal to 1 percent of the amount of credit to
be guaranteed under the transaction, except with
respect to an export credit guarantee transaction
pursuant to section 1542(b) of the Food, Agriculture,
Conservation, and Trade Act of 1990 (Public Law 101-
624; 7 U.S.C. 5622 note).
(c) Market Access Programs.--The Commodity Credit
Corporation or the Secretary shall make available for market
access activities authorized to be carried out by the Commodity
Credit Corporation under section 203--
* * * * * * *
[(A) in addition to any funds that may be
specifically appropriated to implement a market
access program,211094 not less than
$200,000,000 for each of the fiscal years 1991
through 1993, not less than $110,000,000211095
for each of the fiscal years 1994 through 1995,
and not more than $90,000,000 for each of
fiscal years 1996 through 2002,211096 of the
funds of, or an equal value of commodities
owned by, the Commodity Credit Corporation;
and]
(A) in addition to any funds that may be
specifically appropriated to implement a market
access program, not more than $100,000,000 for
fiscal year 2002, $120,000,000 for fiscal year
2003, $140,000,000 for fiscal year 2004,
$160,000,000 for fiscal year 2005, and
$190,000,000 for fiscal year 2006, of the funds
of, or an equal value of commodities owned by,
the Commodity Credit Corporation, except that
this paragraph shall not apply to section 203
(h); and
(2) Program priorities.--of funds made available
under paragraph (1) (A) in excess of $90,000,000 for
any fiscal year, priority shall be given to proposals--
(A) made by eligible trade organizations that
have never participated in the market access
program under this title; or
(B) for market access programs in emerging
markets.
(d) Report on Agricultural Export Credit Programs.--
(1) In general.--Not later than 1 year after the date
of enactment of this subsection, and annually
thereafter, the Secretary shall submit to the Committee
on Agriculture and the Committee on International
Relations of the House of Representatives and the
Committee on Agriculture, Nutrition and Forestry of the
Senate a report on the status of multilateral
negotiations regarding agricultural export credit
programs at the World Trade Organization and the
Organization of Economic cooperation and Development in
fulfillment of Article 10.2 of the Agreement on
Agriculture (as described in section 101(d)(2) of the
Uruguay Round Agreements Act (19 U.S.C. 3511 (d)(2))).
(2) Classified information.--The report under
paragraph (1) shall be submitted in unclassified form,
but may contain a classified annex.
TITLE III--EXPORT ENHANCEMENT PROGRAM
* * * * * * *
SEC. 301. EXPORT ENHANCEMENT PROGRAM.
* * * * * * *
(d) Inapplicability of Price Restrictions.--Any price
restrictions that otherwise may be applicable to dispositions
of agricultural commodities owned by the Commodity Credit
Corporation shall not apply to agricultural commodities
provided under this section.
(e) Funding Levels.--
(1) In general.--The Commodity Credit Corporation
shall make available to carry out the program
established under this section not more than--
(A) $350,000,000 for fiscal year 1996;
(B) $250,000,000 for fiscal year 1997;
(C) $500,000,000 for fiscal year 1998;
(D) $550,000,000 for fiscal year 1999;
(E) $579,000,000 for fiscal year 2000;
(F) $478,000,000 for fiscal year 2001; and
(G) $478,000,000 for [fiscal year 2002] each
of fiscal years 2002 through 2006.
(2) Set-asides.--(A) For each fiscal year, the
Corporation shall, to the extent practicable and
subject to subparagraph (B), ensure that no less than
25 percent of the total of--
(i) the funds expended, and
* * * * * * *
(2) assistance for other costs that are necessary or
appropriate to carry out the foreign market development
cooperator program, including contingent liabilities
that are not otherwise funded.
[SEC. 703] SEC. 703. FUNDING.
(a) In General.--To carry out this title, the Secretary
shall use funds of the Commodity Credit Corporation, or
commodities of the Commodity Credit Corporation of a comparable
value, in the following amounts:
(1) For fiscal year 2002, $37,500,000.
(2) For fiscal year 2003, $40,000,000.
(3) For fiscal year 2004 and each subsequent fiscal
year, $42,500,000.
(b) Program Priorities.--Of funds or commodities provided
under subsection (a) in excess of $35,000,000 for any fiscal
year, priority shall be given to proposals--
(1) made by eligible trade organizations that have
never participated in the program established under
this title; or
(2) for programs established under this title in
emerging markets.
SEC. 703. AUTHORIZATION OF APPROPRIATIONS.
There are authorized to be appropriated to carry out this
title such sums as may be necessary for each of fiscal years
1996 through 2002.
* * * * * * *
STATUTES RELATED TO PUBLIC LAW 480
* * * * * * *
FOOD SECURITY ACT OF 1985
Sec. 1110. (a) This section may be cited as the ``[Food for
Progress Act of 1985] Title VIII of the Agricultural Trade Act
of 1978''.
* * * * * * *
(h) Termination of Authority.--
(1) In general.--The authority to replenish stocks of
eligible commodities to maintain the trust established
under this section shall terminate on September 30,
[2002] 2006.
(2) Disposal of eligible commodities.--Eligible
commodities remaining in the trust after September 30,
[2002] 2006, shall be disposed of by release for use in
providing for emergency humanitarian food needs in
developing countries as provided in this section.
* * * * * * *
AGRICULTURAL ACT OF 1949
TITLE IV--MISCELLANEOUS
* * * * * * *
(iv) Foreign currency proceeds
generated from the sale of commodities
or products under this subparagraph
shall be expended within the country of
origin within a reasonable length of
time, as determined by the Secretary,
except that the Secretary may permit
the use of proceeds in a country other
than the country of origin--
(I) as necessary to expedite
the transportation of
commodities and products
furnished under this
subsection; or
(II) if the proceeds are
generated in a currency
generally accepted in the other
country.
(v) The provisions of clause (iii) of
this subparagraph establishing minimum
annual allocations for sales and use of
proceeds shall not apply to the extent
that there have not been sufficient
requests for such sales and use of
proceeds nor to the extent required
under paragraph (3).
(E) Sales and barter to cover expenses
incurred under paragraph (5)(a).
(F) The provisions of sections 403(i) and
407(c) of the Agricultural Trade Development
and Assistance Act of 1954 shall apply to
donations, sales and barters of eligible
commodities under this subsection.
[(8)(A) To the maximum extent practicable, expedited
procedures shall be used in the implementation of this
subsection.
[(B) The Secretary]
(8) Administrative provisions.--
(A) Direct delivery.--In addition to
practices in effect on the date of enactment of
this subparagraph, the Secretary may approve an
agreement that provides for direct delivery of
eligible commodities to milling or processing
facilities more than 50 percent of the interest
in which is owned by United States citizens in
recipient countries, with proceeds of
transactions transferred in cash to eligible
organizations to carry out approved projects.
(B) Regulations.--The Secretary shall be
responsible for regulations governing sales and
barter, and the use of foreign currency
proceeds, under paragraph (7) of this
subsection that will provide reasonable
safeguards to prevent the occurrence of abuses
in the conduct of activities provided for in
paragraph (7).
(9)(A) Each recipient of commodities and products
approved for sale or barter under paragraph (7) shall
report to the Secretary information with respect to the
items required to be included in the Secretary's report
pursuant to clauses (i) through (iv) of subparagraph
(B). Reports pursuant to this subparagraph shall be
submitted in accordance with regulations of the
Secretary. Such regulations shall require at least one
report annually, to be submitted not later than
December 31 following the end of the fiscal year in
which the commodities and products are received; except
that a report shall not be required with respect to
fiscal year 1985.
* * * * * * *
(c) Certified Institutional Partners.--
(1) In general.--The Secretary shall promulgate
regulations and guidelines to permit private voluntary
organizations and cooperatives to be certified as
institutional partners.
(2) Requirements.--To become a certified
institutional partner, a private voluntary organization
or cooperative shall submit to the Secretary a
certification of organizational capacity that
describes--
(A) the financial, programmatic, commodity
management, and auditing abilities and
practices of the organization or cooperative;
and
(B) the capacity of the organization or
cooperative to carry out projects in particular
countries.
(3) Multi-country proposals.--A certified
institutional partner shall be eligible to--
(A) submit a single proposal for 1 or more
countries that are the same as, or similar to,
those countries in which the certified
institutional partner has already demonstrated
organizational capacity;
(B) receive expedited review and approval of
the proposal; and
(C) request commodities and assistance under
this section for use in 1 or more countries.''.
* * * * * * *
Sec. 7207. Prohibition on United States assistance and financing
[(a) Prohibition on United States Assistance.--
[(1) In general.--Notwithstanding.]
(a) In General.--Notwithstanding any other provision of
law, no United States Government assistance, including United
States foreign assistance, United States export assistance, and
any United States credit or guarantees shall be available for
exports to Cuba or for commercial exports to Iran, Libya, North
Korea, or Sudan.
[(2) Rule of construction.--Nothing in paragraph (1)]
(b) Rule of Construction.--Nothing in subsection (a) shall
be construed to alter, modify, or otherwise affect the
provisions of section 6039 of this title or any other provision
of law relating to Cuba in effect on the day before October 28,
2000.
[(3) Waiver.--The President may waive the application
of paragraph (1)]
(c) Waiver.--The President may waive the application of
subsection (a) with respect to Iran, Libya, North Korea, and
Sudan to the degree the President determines that it is in the
national security interest of the United States to do so, or
for humanitarian reasons.
[(b) Payment prohibition on financing of agricultural sales
to Cuba.--
[(1) In general.--No United States person may provide
or financing terms for sales of agricultural
commodities or products to Cuba or any person in Cuba,
except in accordance with the following terms
(notwithstanding part 515 of title 31, Code of Federal
Regulations, or any other provision of law):
[(A) Payment of cash in advance.
[(B) Financing by third country financial
institutions (excluding United Stats persons or
Government of Cuba entities), except that such
financing may be confirmed or advised by a
United States financial institution.
[Nothing in this paragraph authorizes payment terms or
trade financing involving a debit or credit to an
account of a person located in Cuba or of the
Government of Cuba maintained on the books of a United
States depository institution.
[(2) Penalties.--Any private person or entity that
violates paragraph (1) shall be subject to the
penalties provided in the Trading With the Enemy Act
for violations under that Act.
[(3) Administration and enforcement.--The President
shall issue such regulations as are necessary to carry
out this section, except that the President, in lieu of
issuing new regulations, may apply any regulations in
effect on October 28, 2000, pursuant to the Trading
With the Enemy Act [50 U.S.C.A. App. Sec. 1 et seq.],
with respect to the conduct prohibited in paragraph
(1).
[(4) Definition.--In this subsection--
[(A) the term ``financing'' includes any loan
or extension of credit;
[(B) the term ``United States depository
institution'' means any entity (including its
foreign branches or subsidiaries) organized
under the laws of any jurisdiction within the
United States, or any agency, office or branch
located in the United States of a foreign
entity, that is engaged primarily in the
business of banking (including a bank, savings
bank, savings association, credit union, trust
company, or United States bank holding
company); and
[(C) the term ``United States person'' means
the Federal Government, any State or local
government, or any private person or entity of
the United States.]
* * * * * * *
FOOD STAMP ACT OF 1977
Sec. 3. As used in this Act, the term:
(a) ``Allotment'' means the total value of coupons a
household is authorized to receive during each month.
(b) ``Authorization card'' means the document issued
by the State agency to an eligible household which
shows the allotment the household is entitled to be
issued.
(c) [``Certification period''] ``Eligibility review
period'' means the period for which households shall be
eligible to receive authorization cards. The
[certification period] eligibility review period shall
not exceed 12 months, except that the [certification
period] eligibility review period may be up to 24
months if all adult household members are elderly or
disabled. A State agency shall have at least 1 contact
with each certified household every 12 months. The
limits specified in this section may be extended until
the end of any transitional benefit period established
under section 11(s).
(d) ``Coupon'' means any coupon, stamp, type of
certificate, authorization card, cash or check issued
in lieu of a coupon, or access device, including an
electronic benefit transfer card or personal
identification number, issued pursuant to the
provisions of this Act.
(e) ``Coupon issuer'' means any office of the State
agency or any person, partnership, corporation,
organization, political subdivision, or other entity
with which a State agency has contracted for, or to
which it has delegated functional responsibility in
connection with, the issuance of coupons to households.
(f) ``Drug addiction or alcoholic treatment and
rehabilitation program'' means any such program
conducted by a private nonprofit organization or
institution, or a publicly operated community mental
health center, under part B of title XIX of the Public
Health Service Act (42 U.S.C. 300x et seq.) to provide
treatment that can lead to the rehabilitation of drug
addicts or alcoholics.
(g) ``Food'' means (1) any food [or food product],
food product, or dietary supplement that provides
exclusively 1 or more vitamins or minerals for home
consumption except alcoholic beverages, tobacco, and
hot foods or hot food products ready for immediate
consumption other than those authorized pursuant to
clauses (3), (4), (5), (7), (8), and (9) of this
subsection, (2) seeds and plants for use in gardens to
produce food for the personal consumption of the
eligible household, (3) in the case of those persons
who are sixty years of age or over or who receive
supplemental security income benefits or disability or
blindness payments under title I, II, X, XIV, or XVI of
the Social Security Act [(42 U.S.C. 1381 et seq.)], and
their spouses, meals prepared by and served in senior
citizens' centers, apartment buildings occupied
primarily by such persons, public or private nonprofit
establishments (eating or otherwise) that feed such
persons, private establishments that contract with the
appropriate agency of the State to offer meals for such
persons at concessional prices, and meals prepared for
and served to residents of federally subsidized housing
for the elderly, (4) in the case of persons sixty years
of age or over and persons who are physically or
mentally handicapped or otherwise so disabled that they
are unable adequately to prepare all of their meals,
meals prepared for and delivered to them (and their
spouses) at their home by a public or private nonprofit
organization or by a private establishment that
contracts with the appropriate State agency to perform
such services at concessional prices, (5) in the case
of narcotics addicts or alcoholics, and their children,
served by drug addiction or alcoholic treatment and
rehabilitation programs, meals prepared and served
under such programs, (6) in the case of certain
eligible households living in Alaska, equipment for
procuring food by hunting and fishing, such as nets,
hooks, rods, harpoons, and knives (but not equipment
for purposes of transportation, clothing, or shelter,
and not firearms, ammunition, and explosives) if the
Secretary determines that such households are located
in an area of the State where it is extremely difficult
to reach stores selling food and that such households
depend to a substantial extent upon hunting and fishing
for subsistence, (7) in the case of disabled or blind
recipients of benefits under title I, II, X, XIV, or
XVI of the Social Security Act, or are individuals
described in paragraphs (2) through (7) of subsection
(r), who are residents in a public or private nonprofit
group living arrangement that serves no more than
sixteen residents and is certified by the appropriate
State agency or agencies under regulations issued under
section 1616(e) of the Social Security Act or under
standards determined by the Secretary to be comparable
to standards implemented by appropriate State agencies
under such section [(42 U.S.C. 1382e(e))], meals
prepared and served under such arrangement, (8) in the
case of women and children temporarily residing in
public or private nonprofit shelters for battered women
and children, meals prepared and served, by such
shelters, and (9) in the case of households that do not
reside in permanent dwellings and households that have
no fixed mailing addresses, meals prepared for and
served by a public or private nonprofit establishment
(approved by an appropriate State or local agency) that
feeds such individuals and by private establishments
that contract with the appropriate agency of the State
to offer meals for such individuals at concessional
prices.
(h) ``Food stamp program'' means the program operated
pursuant to the provisions of this Act.
[(i) ``Household'' means (1) an]
(i)(1) ``Household'' means--
(A) an individual who lives alone or who,
while living with others, customarily purchases
food and prepares meals for home consumption
separate and apart from the [others, or (2) a
group] others; or
(B) a group of individuals who live together
and customarily purchase food and prepare meals
together for home consumption. [Spouses]
(2) Spouses who live together, parents and their
children 21 years of age or younger who live together,
and children (excluding foster children) under 18 years
of age who live with and are under the parental control
of a person other than their parent together with the
person exercising parental control shall be treated as
a group of individuals who customarily purchase and
prepare meals together for home consumption even if
they do not do so. [Notwithstanding]
(3) Notwithstanding [the preceding sentences]
paragraphs (1) and (2), an individual who lives with
others, who is sixty years of age or older, and who is
unable to purchase food and prepare meals because such
individual suffers, as certified by a licensed
physician, from a disability which would be considered
a permanent disability under section 221(i) of the
Social Security Act (42 U.S.C. 421(i)) or from a
severe, permanent, and disabling physical or mental
infirmity which is not symptomatic of a disease shall
be considered, together with any of the others who is
the spouse of such individual, an individual household,
without regard to the purchase of food and preparation
of meals, if the income (as determined under section
5(d)) of the others, excluding the spouse, does not
exceed the poverty line, as described in section
5(c)(1), by more than 65 per centum. [In no event]
(4) In no event shall any individual or group of
individuals constitute a household if they reside in an
institution or boarding house, or else live with others
and pay compensation to the others for meals. [For the
purposes of this subsection, residents]
(5) For the purposes of this subsection, the
following persons shall not be considered to be
residents of institutions and shall be considered to be
individual households:
(A) Residents of federally subsidized housing
for the elderly, disabled or blind recipients
of benefits under title I, II, X, XIV, or XVI
of the Social Security [Act, or are
individuals] Act.
(B) Individuals described in paragraphs (2)
through (7) of subsection (r), who are
residents in a public or private nonprofit
group living arrangement that serves no more
than sixteen residents and is certified by the
appropriate State agency or agencies under
regulations issued under section 1616(e) of the
Social Security Act or under standards
determined by the Secretary to be comparable to
standards implemented by appropriate State
agencies under [such section [(42 U.S.C.
1382e(e))], temporary] that section.
(C) Temporary residents of public or private
nonprofit shelters for battered women and
[children, residents] children.
(D) Residents of public or private nonprofit
shelters for individuals who do not reside in
permanent dwellings or have no fixed mailing
addresses, who are otherwise eligible for
[coupons, and narcotics] coupons.
(E) Narcotics; and addicts or alcoholics,
together with their children, who live under
the supervision of a private nonprofit
institution, or a publicly operated community
mental health center, for the purpose of
regular participation in a drug or alcoholic
treatment program shall not be considered
residents of institutions and [shall be
considered individual households.].
* * * * * * *
(d) A Household income for purposes of the food stamp
program shall include all income from whatever source
(including child support payments made to a household member by
an individual who is legally obligated to make the payments)
excluding only (1) any gain or benefit which is not in the form
of money payable directly to a household (notwithstanding its
conversion in whole or in part to direct payments to households
pursuant to any demonstration project carried out or authorized
under Federal law including demonstration projects created by
the waiver of provisions of Federal law), except as provided in
subsection (k), (2) any income in [the certification period
which] that is received too infrequently or irregularly to be
reasonably anticipated, but not in excess of $30 in a quarter,
subject to modification by the Secretary in light of subsection
(f), (3) all educational loans on which payment is deferred,
grants, scholarships, fellowships, veterans' educational
benefits, and the like (A) awarded to a household member
enrolled at a recognized institution of post-secondary
education, at a school for the handicapped, in a vocational
education program, or in a program that provides for completion
of a secondary school diploma or obtaining the equivalent
thereof, (B) to the extent that they do not exceed the amount
used for or made available as an allowance determined by such
school, institution, program, or other grantor, for tuition and
mandatory fees (including the rental or purchase of any
equipment, materials, and supplies related to the pursuit of
the course of study involved), books, supplies, transportation,
and other miscellaneous personal expenses (other than living
expenses), of the student incidental to attending such school,
institution, or program, and (C) to the extent loans include
any origination fees and insurance premiums, (4) all loans
other than educational loans on which repayment is deferred,
(5) reimbursements which do not exceed expenses actually
incurred and which do not represent a gain or benefit to the
household and any allowance a State agency provides no more
frequently than annually to families with children on the
occasion of those children's entering or returning to school or
child care for the purpose of obtaining school clothes (except
that no such allowance shall be excluded if the State agency
reduces monthly assistance under a State program funded under
part A of title IV of the Social Security Act (42 U.S.C. 601 et
seq.) in the month for which the allowance is provided):
Provided, That no portion of benefits provided under title
IV09A of the Social Security Act [(42 U.S.C. 601 et seq.)], to
the extent it is attributable to an adjustment for work-related
or child care expenses (except for payments or reimbursements
for such expenses made under an employment, education, or
training program initiated under such title after the date of
enactment of the Hunger Prevention Act of 1988 [September 19,
1988]), and no portion of any educational loan on which payment
is deferred, grant, scholarship, fellowship, veterans'
benefits, and the like that are provided for living expenses,
shall be considered such reimbursement, (6) moneys received and
used for the care and maintenance of a third-party beneficiary
who is not a household member and child support payments made
by a household member to or for an individual who is not a
member of the household if the household member is legally
obligated to make the payments, (7) income earned by a child
who is a member of the household, who is an elementary or
secondary school student, and who is 17 years of age or
younger, (8) moneys received in the form of nonrecurring lump-
sum payments, including, but not limited to, income tax
refunds, rebates, or credits, cash donations based on need that
are received from one or more private nonprofit
charitableorganizations, but not in excess of $300 in the aggregate in
a quarter, retroactive lump-sum social security or railroad retirement
pension payments and retroactive lump-sum insurance settlements:
Provided, That such payments shall be counted as resources, unless
specifically excluded by other laws, (9) the cost of producing self-
employed income, but household income that otherwise is included under
this subsection shall be reduced by the extent that the cost of
producing self-employment income exceeds the income derived from self-
employment as a farmer, (10) any income that any other Federal law
specifically excludes from consideration as income for purposes of
determining eligibility for the food stamp program except as otherwise
provided in subsection (k) of this section, (11)(A) any payments or
allowances made for the purpose of providing energy assistance under
any Federal law (other than part A of title IV of the Social Security
Act (42 U.S.C. 601 et seq.)), or (B) a 1-time payment or allowance made
under a Federal or State law for the costs of weatherization or
emergency repair or replacement of an unsafe or inoperative furnace or
other heating or cooling device, (12) through September 30 of any
fiscal year, any increase in income attributable to a cost-of-living
adjustment made on or after July 1 of such fiscal year under title II
or XVI of the Social Security Act (42 U.S.C. 401 et seq.), section
3(a)(1) of the Railroad Retirement Act of 1974 (45 U.S.C. 231b(a)(1)),
or section 3112 of title 38, United States Code, if the household was
certified as eligible to participate in the food stamp program or
received an allotment in the month immediately preceding the first
month in which the adjustment was effective, (13) any payment made to
the household under section 3507 of the Internal Revenue Code of 1986
(relating to advance payment of earned income credit), (14) any payment
made to the household under section 6(d)(4)(I) for work related
expenses or for dependent care, (15) any amounts necessary for the
fulfillment of a plan for achieving self-support of a household member
as provided under subparagraph (A)(iii) or (B)(iv) of section
1612(b)(4) of the Social Security Act (42 U.S.C. 1382a(b)(4)), (16) at
the option of the State agency, any educational loans on which payment
is deferred, grants, scholarships, fellowships, veterans' educational
benefits, and the like (other than loans, grants, scholarships,
fellowships, veterans' educational benefits, and the like excluded
under paragraph (3)), to the extent that they are required to be
excluded under title XIX of the Social Security Act (42 U.S.C. 1396 et
seq.), (17) at the option of the State agency, any State complementary
assistance program payments that are excluded for the purpose of
determining eligibility for medical assistance under section 1931 of
the Social Security Act (42 U.S.C. 1396u-1), and (18) at the option of
the State agency, any types of income that the State agency does not
consider when determining eligibility for (A) cash assistance under a
program funded under part A of title IV of the Social Security Act (42
U.S.C. 601 et seq.) or the amount of such assistance, or (B) medical
assistance under section 1931 of the Social Security Act (42 U.S.C.
1396u-1), except that this paragraph does not authorize a State agency
to exclude wages or salaries, benefits under title I, II, IV, X, XIV,
or XVI of the Social Security Act (42 U.S.C. 1381 et seq.), regular
payments from a government source (such as unemployment benefits and
general assistance), worker's compensation, child support payments made
to a household member by an individual who is legally obligated to make
the payments, or such other types of income the consideration of which
the Secretary determines by regulation to be essential to equitable
determinations of eligibility and benefit levels.
* * * * * * *
Section 2605(f)(1) of the Low-Income Home Energy Assistance
Act of 1981 (42 U.S.C. 8624(f)) requires that any home energy
assistance payments or allowances not be considered income or
resources for purposes of the food stamp program.
(e) Deductions From Income.--
[(1) Standard deduction.--The Secretary shall allow a
standard deduction for each household in the 48
contiguous States and the District of Columbia, Alaska,
Hawaii, Guam, and the Virgin Islands of the United
States of $134, $229, $189, $269, and $118,
respectively.]
(1) Standard deduction.--
(A) In general.--Subject to the other
provisions of this paragraph, the Secretary
shall allow for each household a standard
deduction that is equal to the greater of--
(i) the applicable percentage
specified in subparagraph (D) of the
applicable income standard of
eligibility established under
subsection (c)(1); or
(ii) the minimum deduction specified
in subparagraph (E).
(B) Guam.--The Secretary shall allow for each
household in Guam a standard deduction that
is--
(i) equal to the applicable
percentage specified in subparagraph
(D) of twice the income standard of
eligibility established under
subsection (c)(1) for the 48 contiguous
States and the District of Columbia;
but
(ii) not less than the minimum
deduction for Guam specified in
subparagraph (E).
(C) Households of 6 or more members.--The
income standard of eligibility established
under subsection (c)(1) for a household of 6
members shall be used to calculate the standard
deduction for each household of 6 or more
members.
(D) Applicable percentage.--For the purpose
of subparagraph (A), the applicable percentage
shall be--
(i) 8 percent for each of fiscal
years 2002 through 2007;
(ii) 8.25 percent for fiscal year
2008;
(iii) 8.5 percent for each of fiscal
years 2009 and 2010; and
(iv) 9 percent for fiscal year 2011
and each fiscal year thereafter.
(E) Minimum deduction.--The minimum deduction
shall be $134, $229, $189, $269, and $118 for
the 48 contiguous States and the District of
Columbia, Alaska, Hawaii, Guam, and the Virgin
Islands of the United States, respectively.
(2) Earned income deduction.--
* * * * * * *
(B) Excluded expenses.--The excluded expenses
referred to in subparagraph (A) are--
(i) expenses paid on behalf of the
household by a third party;
(ii) amounts made available and
excluded, for the expenses referred to
in subparagraph (A), under subsection
(d)(3); and
(iii) expenses that are paid under
section 6(d)(4).
[(4) Deduction for child support payments.--
[(A) In general.--A household shall be
entitled to a deduction for child support
payments made by a household member to or for
an individual who is not a member of the
household if the household member is legally
obligated to make the payments.
[(B) Methods for determining amount.--The
Secretary may prescribe by regulation the
methods, including calculation on a
retrospective basis, that a State agency shall
use to determine the amount of the deduction
for child support payments.]
(4) Deduction for child support payments.--
(A) In general.--In lieu of providing an
exclusion for legally obligated child support
payments made by a household member under
subsection (d)(6), a State agency may elect to
provide a deduction for the amount of the
payments.
(B) Order of determining deductions.--A
deduction under this paragraph shall be
determined before the computation of the excess
shelter expense deduction under paragraph (7).
[(5) Homeless shelter allowance.--Under rules
prescribed by the Secretary, a State agency may develop
a standard homeless shelter allowance, which shall not
exceed $143 per month, for such expenses as may
reasonably be expected to be incurred by households in
which all members are homeless individuals but are not
receiving free shelter throughout the month. A State
agency that develops the allowance may use the
allowance in determining eligibility and allotments for
the households. The State agency may make a household
with extremely low shelter costs ineligible for the
allowance.]
[(6)] (5) Excess medical expense deduction.--
(A) In general.--A household containing an
elderly or disabled member shall be entitled,
with respect to expenses other than expenses
paid on behalf of the household by a third
party, to an excess medical expense deduction
for the portion of the actual costs of
allowable medical expenses, incurred by the
elderly or disabled member, exclusive of
special diets, that exceeds $35 per month.
(B) Method of claiming deduction.--
(i) In general.--A State agency shall
offer an eligible household under
subparagraph (A) a method of claiming a
deduction for recurring medical
expenses that are initially verified
under the excess medical expense
deduction in lieu of submitting
information on, or verification of,
actual expenses on a monthly basis.
(ii) Method.--The method described in
clause (i) shall--
(I) be designed to minimize
the burden for the eligible
elderly or disabled household
member choosing to deduct the
recurrent medical expenses of
the member pursuant to the
method;
(II) rely on reasonable
estimates of the expected
medical expenses of the member
for the [certification period]
eligibility review period
(including changes that can be
reasonably anticipated based on
available information about the
medical condition of the
member, public or private
medical insurance coverage, and
the current verified medical
expenses incurred by the
member); and
(III) not require further
reporting or verification of a
change in medical expenses if
such a change [has been
anticipated for the
certification period] was
anticipated when the household
applied or at the most recent
redetermination of eligibility
for the household.
[(7)] (6) Excess shelter expense deduction.--
(A) In general.--[A household]
(i) In general._A household shall be
entitled, with respect to expenses
other than expenses paid on behalf of
the household by a third party, to an
excess shelter expense deduction to the
extent that the monthly amount expended
by a household for shelter exceeds an
amount equal to 50 percent of monthly
household income after all other
applicable deductions have been
allowed.
(ii) Inclusion of certain payments.--
In determining the shelter expenses of
a household under this paragraph, the
State agency shall include any required
payment to the landlord of the
household without regard to whether the
required payment is designated to pay
specific charges.
* * * * * * *
(I) In general.--A State
agency may make the use of a
standard utility allowance
mandatory for all households
with qualifying utility costs
if--
(aa) the State agency
has developed 1 or more
standards that include
the cost of heating and
cooling and 1 or more
standards that do not
include the cost of
heating and cooling;
and
(bb) the Secretary
finds (without regard
to subclause (III))
that the standards will
not result in an
increased cost to the
Secretary.
(II) Household election.--A
State agency that has not made
the use of a standard utility
allowance mandatory under
subclause (I) shall allow a
household to switch, at [the
end of a certification period]
each redetermination of the
eligibility of the household,
between the standard utility
allowance and a deduction based
on the actual utility costs of
the household.
(III) Inapplicability of
certain restrictions.--Clauses
(ii)(II) and (ii)(III) shall
not apply in the case of a
State agency that has made the
use of a standard utility
allowance mandatory under
subclause (I).
* * * * * * *
(IV) Proration of
assistance.--For the purpose of
the food stamp program,
assistance provided under the
Low-Income Home Energy
Assistance Act of 1981 (42
U.S.C. 8621 et seq.) shall be
considered to be prorated over
the entire heating or cooling
season for which the assistance
was provided.
(D) Homeless households.--
(i) Alternative deduction.--In lieu
of the deduction provided under
subparagraph (A), a State agency may
elect to allow a household in which all
members are homeless individuals, but
that is not receiving free shelter
throughout the month, to receive a
deduction of $143 per month.
(ii) Ineligibility.--The State agency
may make a household with extremely low
shelter costs ineligible for the
alternative deduction under clause (i).
(n) State Options To Simplify Determination of Child
Support Payments Made by Household Members.--
(1) In general.--Regardless of whether a State agency
elects to provide a deduction under subsection (e)(4),
the Secretary shall establish simplified procedures to
allow State agencies, at the option of the State
agencies, to determine the amount of the legally
obligated child support payments made, including
procedures to allow the State agency to rely on
information from the agency responsible for
implementing the program under part D of title IV of
the Social Security Act (42 U.S.C. 661 et seq.)
concerning payments made in prior months in lieu of
obtaining current information from the household.
(2) Duration of determination of amount of support
payments.--If a State agency makes a determination of
the amount of support payments of a household under
paragraph (1), the State agency may provide that the
amount of the exclusion or deduction for the household
shall not change until the eligibility of the household
is next redetermined under section 11(e)(4).
(f)(1)(A) Household income for those households that, by
contract for other than an hourly or piecework basis or by
self-employment, derive their annual income in a period of time
shorter than one year shall be calculated by averaging such
income over a twelve-month period. Notwithstanding the
preceding sentence, household income resulting from the self-
employment of a member in a farming operation, who derives
income from such farming operation and who has irregular
expenses to produce such income, may, at the option of the
household, be calculated by averaging such income and expenses
over a 12-month period. Notwithstanding the first sentence, if
the averaged amount does not accurately reflect the household's
actual monthly circumstances because the household has
experienced a substantial increase or decrease in business
earnings, the State agency shall calculate the self-employment
income based on anticipated earnings.
(B) Household income for those households that receive
nonexcluded income of the type described in subsection (d)(3)
of this section shall be calculated by averaging such income
over the period for which it is received.
(C) Simplified determination of earned income.--
(i) In general.--A State agency may elect to
determine monthly earned income by multiplying weekly
income by 4 and biweekly income by 2.
(ii) Adjustment of earned income deduction.--A State
agency that makes an election described in clause (i)
shall adjust the earned income deduction under
subsection (e)(2)(B) to the extentnecessary to prevent
the election from resulting in increased costs to the food stamp
program, as determined consistent with standards promulgated by the
Secretary.
(D) Simplified determination of deductions.--
(i) In general.--Except as provided in clause (ii),
for the purposes of subsection (e), a State agency may
elect to disregard until the next redetermination of
eligibility under section 11(e)(4) 1 or more types of
changes in the circumstances of a household that affect
the amount of deductions the household may claim under
subsection (e).
(ii) Changes that may not be disregarded.--Under
clause (i), a State agency may not disregard--
(I) any reported change of residence; or
(II) under standards prescribed by the
Secretary, any change in earned income.
* * * * * * *
(5) The Secretary shall promulgate rules by which
State agencies shall develop standards for identifying
kinds of resources that, as a practical matter, the
household is unlikely to be able to sell for any
significant return because the household's interest is
relatively slight or because the cost of selling the
household's interest would be relatively great.
Resources so identified shall be excluded as
inaccessible resources. A resource shall be so
identified if its sale or other disposition is unlikely
to produce any significant amount of funds for the
support of the household. The Secretary shall not
require the State agency to require verification of the
value of a resource to be excluded under this paragraph
unless the State agency determines that the information
provided by the household is questionable.
(6) Exclusion of types of financial resources not
considered under certain other federal programs.--
(A) In general.--Subject to subparagraph (B),
the Secretary shall promulgate regulations
under which a State agency may, at the option
of the State agency, exclude from financial
resources under this subsection any types of
financial resources that the State agency does
not consider when determining eligibility for--
(i) cash assistance under a program
funded under part A of title IV of the
Social Security Act (42 U.S.C. 601 et
seq.); or
(ii) medical assistance under section
1931 of the Social Security Act (42
U.S.C. 1396u-1).
(B) Limitations.--Subparagraph (A) does not
authorize a State agency to exclude--
(i) cash;
(ii) licensed vehicles;
(iii) amounts in any account in a
financial institution that are readily
available to the household; or
(iv) any other similar type of
resource the inclusion in financial
resources of which the Secretary
determines by regulation to be
essential to equitable determinations
of eligibility under the food stamp
program, except to the extent that any
of those types of resources are
excluded under another paragraph of
this subsection.
(h)(1) The Secretary shall, after consultation with the
official empowered to exercise the authority provided for by
sections 402 and 502 of the Robert T. Stafford Disaster Relief
and Emergency Assistance Act (42 U.S.C. 5121 et seq.),
establish temporary emergency standards of eligibility for the
duration of the emergency for households who are victims of a
disaster which disrupts commercial channels of food
distribution, if such households are in need of temporary food
assistance and if commercial channels of food distribution have
again become available to meet the temporary food needs of such
households. Such standards as are prescribed for individual
emergencies may be promulgated without regard to section 4(c)
of this Act or the procedures set forth in section 553 of title
5 of the United States Code.
(2) The Secretary shall--
(A) establish a Food Stamp Disaster Task Force to
assist States in implementing and operating the
disaster program and the regular food stamp program in
the disaster area; and
(B) if the Secretary, in the Secretary's discretion,
determines that it is cost-effective to send members of
the Task Force to the disaster area, the Secretary
shall send them to such area as soon as possible after
the disaster occurs to provide direct assistance to
State and local officials.
(3)(A) The Secretary shall provide, by regulation, for
emergency allotments to eligible households to replace food
destroyed in a disaster. The regulations shall provide for
replacement of the value of food actually lost up to a limit
approved by the Secretary not greater than the applicable
maximum monthly allotment for the household size.
(B) The Secretary shall adjust issuance methods reporting
and other application requirements to be consistent with what
is practicable under actual conditions in the affected area. In
making thisadjustment, the Secretary shall consider the
availability of the State agency's offices and personnel, any
conditions that make reliance on electronic benefit transfer systems
described in section 7(i) impracticable, and any damage to or
disruption of transportation and communication facilities.
* * * * * * *
(D) Any sponsor of an alien, and such alien, shall be
jointly and severably liable for an amount equal to any
overpayment made to such alien during the period of three years
after such alien's entry into the United States, on account of
such sponsor's failure to provide correct information under the
provisions of this section, except where such sponsor was
without fault, or where good cause for such failure existed.
Any such overpayment which is not repaid shall be recovered in
accordance with the provisions of section 13(b)(2) of this Act.
(E) The provisions of this subsection shall not apply with
respect to any alien who is a member of the sponsor's
household, as defined in section 3(i) of this Act, or to any
alien who is under 18 years of age.
* * * * * * *
(4) Third party energy assistance payments.--
(A) Energy assistance payments.--For purposes of
subsection (d)(1), a payment made under a State law
(other than a law referred to in paragraph (2)(H)) to
provide energy assistance to a household shall be
considered money payable directly to the household.
(B) Energy assistance expenses.--For purposes of
[subsection (e)(7)] subsection (e)(6), an expense paid
on behalf of a household under a State law to provide
energy assistance shall be considered an out-of-pocket
expense incurred and paid by the household.
* * * * * * *
ELIGIBILITY DISQUALIFICATIONS
Sec. 6. (a) In addition to meeting the standards of
eligibility prescribed in section 5 of this Act, households and
individuals who are members of eligible households must also
meet and comply with the specific requirements of this section
to be eligible for participation in the food stamp program.
* * * * * * *
(4) The Secretary shall prescribe such regulations as
the Secretary may deem appropriate to ensure that
information concerning any such determination with
respect to a specific individual is forwarded to the
Office of the Secretary by any appropriate State or
Federal entity for the use of the Secretary in
administering the provisions of this section. No State
shall withhold such information from the Secretary or
the Secretary's designee for any reason whatsoever.
(c) [No household] Except in a case in which a household is
receiving transitional benefits during the transitional
benefits period under section 11(s), no household shall be
eligible to participate in the food stamp program if it refuses
to cooperate in providing information to the State agency that
is necessary for making a determination of its eligibility or
for completing any subsequent review of its eligibility.
(1)(A) A State agency may require certain categories
of households to file periodic reports of income and
household circumstances in accordance with standards
prescribed by the Secretary, except that a State agency
may not require periodic reporting by--
(i) migrant or seasonal farmworker
households;
(ii) households in which all members are
homeless individuals; or
(iii) households that have no earned income
and in which all adult members are elderly or
disabled.
(B) Each household that is not required to file such
periodic reports on a monthly basis shall be required
to report or cause to be reported to the State agency
changes in income or household circumstances that the
Secretary considers necessary to assure accurate
eligibility and benefit determinations.
(C) A State agency may require periodic reporting on
a monthly basis by households residing on a reservation
only if--
(i) the State agency reinstates benefits,
without requiring a new application, for any
household residing on a reservation that
submits a report not later than 1 month after
the end of the month in which benefits would
otherwise be provided;
(ii) the State agency does not delay, reduce,
suspend, or terminate the allotment of a
household that submits a report not later than
1 month after the end of the month in which the
report is due;
(iii) on the date of enactment of this
subparagraph, the State agency requires
households residing on a reservation to file
periodic reports on a monthly basis; and
(iv) the [certification period] interval
between required redeterminations of
eligibility for households residing on a
reservation that are required to file
periodic reports on a monthly basis is 2
years, unless the State demonstrates just
cause to the Secretary for a shorter
[certification period] interval between
required redeterminations of eligibility.
(D) Frequency of reporting.--
(i) In general.--Except as provided in
subparagraphs (A) and (C), a State agency may
require households that report on a periodic
basis to submit reports--
(I) not less often than once each 6
months; but
(II) not more often than once each
month.
(ii) Reporting by households with excess
income.--A household required to report less
often than once each 3 months shall,
notwithstanding subparagraph (B), report in a
manner prescribed by the Secretary if the
income of the household for any month exceeds
the standard established under section 5(c)(2).
* * * * * * *
(v) Selecting a head of household.--
(I) In general.--For purposes of this
paragraph, the State agency shall allow
the household to select any adult
parent of a child in the household as
the head of the household if all adult
household members making application
under the food stamp program agree to
the selection.
(II) Time for making designation.--A
household may designate the head of the
household under subclause (I) each time
the household is certified for
participation in the food stamp
program, but may not change the
designation during a [certification
period] an eligibility review period
unless there is a change in the
composition of the household.
* * * * * * *
(B) a program under section 236 of the Trade Act of
1974 (19 U.S.C. 2296); [and]
(C) a program of employment and training operated or
supervised by a State or political subdivision of a
State that meets standards approved by the Governor of
the State, including a program under subsection (d)(4),
other than a job search program or a job search
training program; and
(D) a job search program or job search training
program if--
(i) the program meets standards established
by the Secretary to ensure that the participant
is continuously and actively seeking employment
in the private sector; and
(ii) no position is currently available for
the participant in an employment or training
program that meets the requirements of
subparagraph (C).
(2) Work requirement.--Subject to the other
provisions of this subsection, no individual shall be
eligible to participate in the food stamp program as a
member of any household if, during the preceding [36-
month] 24-month period, the individual received food
stamp benefits for not less than [3] 6 months
(consecutive or otherwise) during which the individual
did not--
* * * * * * *
(B) Report.--The Secretary shall report the
basis for a waiver under subparagraph (A) to
the Committee on Agriculture of the House of
Representatives and the Committee on
Agriculture, Nutrition, and Forestry of the
Senate.
[(5) Subsequent eligibility.--
[(A) Regaining eligibility.--An individual
denied eligibility under paragraph (2) shall
regain eligibility to participate in the food
stamp program if, during a 30-day period, the
individual--
[(i) works 80 or more hours;
[(ii) participates in and complies
with the requirements of a work program
for 80 or more hours, as determined by
a State agency; or
[(iii) participates in and complies
with the requirements of a program
under section 20 or a comparable
program established by a State or
political subdivision of a State.
[(B) Maintaining eligibility.--An individual
who regains eligibility under subparagraph (A)
shall remain eligible as long as the individual
meets the requirements of subparagraph (A),
(B), or (C) of paragraph (2).
[(C) Loss of employment.--
[(i) In general.--An individual who
regained eligibility under subparagraph
(A) and who no longer meets the
requirements of subparagraph (A), (B),
or (C) of paragraph (2) shall remain
eligible for a consecutive 3-month
period, beginning on the date the
individual first notifies the State
agency that the individual no longer
meets the requirements of subparagraph
(A), (B), or (C) of paragraph (2).
[(ii) Limitation.--An individual
shall not receive any benefits pursuant
to clause (i) for more than a single 3-
month period.]
(5) Eligibility of individuals while meeting work
requirement.--Notwithstanding paragraph (2), an
individual who would otherwise be ineligible under that
paragraph shall be eligible to participate in the food
stamp program during any period in which the individual
meets the work requirement of subparagraph (A), (B), or
(C) of that paragraph.
(6) 15-percent exemption.--
(A) Definitions.--In this paragraph:
(i) Caseload.--The term ``caseload''
means the average monthly number of
individuals receiving food stamps
during the 12-month period ending the
preceding June 30.
(ii) Covered individual.--The term
``covered individual'' means a food
stamp recipient, or an individual
denied eligibility for food stamp
benefits solely due to paragraph (2),
who--
(I) is not eligible for an
exception under paragraph (3);
(II) does not reside in an
area covered by a waiver
granted under paragraph (4);
(III) is not complying with
subparagraph (A), (B), or (C)
of paragraph (2) and;
(IV) is not receiving food
stamp benefits during the [3] 6
months of eligibility provided
under paragraph (2)[; and].
[(V) is not receiving food
stamp benefits under paragraph
(5).]
(B) General rule.--Subject to subparagraphs
(C) through (G), a State agency may provide an
exemption from the requirements of paragraph
(2) for covered individuals.
* * * * * * *
(A) Implementation.--Not later than October
1, 2002, each State agency shall implement an
electronic benefit transfer system under which
household benefits determined under section
8(a) or 26 are issued from and stored in a
central databank, unless the Secretary provides
a waiver for a State agency that faces unusual
barriers to implementing an electronic benefit
transfer system.
(B) Timely implementation.--Each State agency
is encouraged to implement an electronic
benefit transfer system under subparagraph (A)
as soon as practicable.
(C) State flexibility.--Subject to paragraph
(2), a State agency may procure and implement
an electronic benefit transfer system under the
terms, conditions, and design that the State
agency considers appropriate.
(D) Operation.--An electronic benefit
transfer system should take into account
generally accepted standard operating rules
based on--
(i) commercial electronic funds
transfer technology;
(ii) the need to permit interstate
operation and law enforcement
monitoring; and
(iii) the need to permit monitoring
and investigations by authorized law
enforcement agencies.
(E) Access to ebt systems.--
(i) In general.--No benefits shall be
taken off-line or otherwise made
inaccessible because of inactivity
until at least 180 days have elapsed
since a household last accessed the
account of the household.
(ii) Notice to household.--In a case
in which benefits are taken off-line or
otherwise made inaccessible, the
household shall be sent a notice that--
(I) explains how to
reactivate the benefits; and
(II) offers assistance if the
household is having difficulty
accessing the benefits of the
household.
(2) The Secretary shall issue final regulations that
establish standards for the approval of such a system.
The standards shall include--
[(A) determining the cost-effectiveness of
the system to ensure that its operational cost,
including the pro rata cost of capital
expenditures and other reasonable startup
costs, does not exceed the operational cost of
issuance systems in use prior to the
implementation of the electronic benefit
transfer system] system;
[(B)] (A) defining the required level of
recipient protection regarding privacy, ease of
use, and access to and service in retail food
stores;
[(C)] (B) the terms and conditions of
participation by retail food stores, financial
institutions, and other appropriate parties;
[(D)](C)(i) measures to maximize the security
of a system using the most recent technology
available that the State agency considers
appropriate and cost effective and which may
include personal identification numbers,
photographic identification on electronic
benefit transfer cards, and other measures to
protect against fraud and abuse; and
(ii) effective not later than 2 years after
the date of enactment of this clause [August
22, 1996], to the extent practicable, measures
that permit a system to differentiate items of
food that may be acquired with an allotment
from items of food that may not be acquired
with an allotment;
[(E)] (D) system transaction interchange,
reliability, and processing speeds;
[(F)] (E) financial accountability;
[(G)] (F) the required testing of system
operations prior to implementation;
[(H)] (G) the analysis of the results of
system implementation in a limited project area
prior to expansion; and
[(I)] (H) procurement standards.
* * * * * * *
VALUE OF ALLOTMENT
Sec. 8. (a) The value of the allotment which State agencies
shall be authorized to issue to any households certified as
eligible to participate in the food stamp program shall be
equal to the cost to such households of the thrifty food plan
reduced by an amount equal to 30 per centum of the household's
income, as determined in accordance with section 5 (d) and (e)
of this Act, rounded to the nearest lower whole dollar:
Provided, That for households of one and two persons the
minimum allotment shall be $10 per month.
* * * * * * *
(c)(1) The value of the allotment issued to any eligible
household for the initial month or other initial period for
which an allotment is issued shall have a value which bears the
same ratio to the value of the allotment for a full month or
other initial period for which the allotment is issued as the
number of days (from the date of application) remaining in the
month or other initial period for which the allotment is issued
bears to the total number of days in the month or other initial
period for which the allotment is issued, except that no
allotment may be issued to a household for the initial month or
period if the value of the allotment which such household would
otherwise be eligible to receive under this subsection is less
than $10. Households shall receive full months' allotments for
all months [within a certification period], except as provided
in the first sentence of this paragraph with respect to an
initial month.
(2) As used in this subsection, the term ``initial month''
means (A) the first month for which an allotment is issued to a
household, (B) the first month for which an allotment is issued
to a household following any period in which such household was
not participating in the food stamp program under this Act
after the [expiration of a certification period or after the
termination of the certification of a household, during a
certification period,] termination of benefits to the
household, when the household ceased to be eligible after
notice and an opportunity for a hearing under section
11(e)(10), and (C) in the case of a migrant or seasonal
farmworker household, the first month for which allotment is
issued to a household that applies following any period of more
than 30 days in which such household was not participating in
the food stamp program after previous participation in such
program.
* * * * * * *
(e) Allotments for Households Residing in Centers.--
(1) In general.--In the case of an individual who
resides in a center for the purpose of a drug or
alcoholic treatment program described in [the last
sentence of section 3(i)] section 3(i)(5), a State
agency may provide an allotment for the individual to--
(A) the center as an authorized
representative of the individual for a period
that is less than 1 month; and
(B) the individual, if the individual leaves
the center.
(2) Direct payment.--A State agency may require an
individual referred to in paragraph (1) to designate
the center in which the individual resides as the
authorized representative of the individual for the
purpose of receiving an allotment.
(f) Simplified Procedures for Residents of Certain Group
Facilities.--
(1) In general.--At the option of the State agency,
allotments for residents of facilities described in
subparagraph (A), (B), or (E) of section 3(i)(5) may be
determined and issued under this subsection in lieu of
subsection (a).
(2) Amount of allotment.--The allotment for each
eligible resident described in paragraph (1) shall be
calculated in accordance with standardized procedures
established by the Secretary that take into account the
allotments typically received by residents of
facilities described in paragraph (1).
(3) Issuance of allotment.--
(A) In general.--The State agency shall issue
an allotment determined under this subsection
to the administration of a facility described
in paragraph (1) as the authorized representative
of the residents of the facility.
(B) Adjustment.--The Secretary shall
establish procedures to ensure that a facility
described in paragraph (1) does not receive a
greater proportion of a resident's monthly
allotment than the proportion of the month
during which the resident lived in the
facility.
(4) Departures of covered residents.--
(A) Notification.--Any facility described in
paragraph (1) that receives an allotment for a
resident under this subsection shall--
(i) notify the State agency promptly
on the departure of the resident; and
(ii) notify the resident, before the
departure of the resident, that the
resident--
(I) is eligible for continued
benefits under the food stamp
program; and
(II) should contact the State
agency concerning continuation
of the benefits.
(B) Issuance to departed residents.--On
receiving a notification under subparagraph
(A)(i) concerning the departure of a resident,
the State agency--
(i) shall promptly issue the departed
resident an allotment for the days of
the month after the departure of the
resident (calculated in a manner
prescribed by the Secretary) unless the
departed resident reapplies to
participate in the food stamp program;
and
(ii) may issue an allotment for the
month following the month of the
departure (but not any subsequent
month) based on this subsection unless
the departed resident reapplies to
participate in the food stamp program.
(C) State option.--The State agency may elect
not to issue an allotment under subparagraph
(B)(i) if the State agency lacks sufficient
information on the location of the departed
resident to provide the allotment.
(D) Effect of reapplication.--If the departed
resident reapplies to participate in the food
stamp program, the allotment of the departed
resident shall be determined without regard to
this subsection.
* * * * * * *
Section 705(a)(2)(D) of the Older Americans Act Amendments
of 1992 (Public Law 102-375; 42 U.S.C. 3058k note) provides
that the purposes of such section is to provide outreach,
counseling, and assistance in order to assist older individuals
in obtaining benefits under public programs under which the
individuals are entitled to benefits, including benefits under
the program established under this Act.
(2)(A) that the State agency shall establish
procedures governing the operation of food stamp
offices that the State agency determines best serve
households in the State, including households with
special needs, such as households with elderly or
disabled members, households in rural areas with low-
income members, homeless individuals, households
residing on reservations, and households in areas in
which a substantial number of members of low-income
households speak a language other than English.
(B) In carrying out subparagraph (A), a State
agency--
(i) shall provide timely, accurate, and fair
service to applicants for, and participants in,
the food stamp program;
(ii)(I) shall develop an application
containing the information necessary to comply
with this Act; and
(II) if the State agency maintains a website
for the State agency, shall make the
application available on the website in each
language in which the State agency makes a
printed application available;
(iii) shall permit an applicant household to
apply to participate in the program on the same
day that the household first contacts a food
stamp office in person during office hours;
* * * * * * *
[(4) that the State agency shall insure that each
participating household receive a notice of expiration
of its certification prior to the start of the last
month of its certification period advising the
household that it must submit a new application in
order to renew its eligibility for a new certification
period and, further, that each such household which
seeks to be certified another time or more times
thereafter by filing an application for such
recertification no later than fifteen days prior to the
day upon which its existing certification period
expires shall, if found to be still eligible, receive
its allotment no later than one month after the receipt
of the last allotment issued to it pursuant to its
prior certification, but if such household is found to
be ineligible or to be eligible for a smaller allotment
during the new certification period it shall not
continue to participate and receive benefits on the
basis authorized for the preceding certification period
even if it makes a timely request for a fair hearing
pursuant to paragraph (10) of this subsection: Provided,
That the timeliness standards for submitting the notice
of expiration and filing an application for recertification
may be modified by the Secretary in light of sections
5(f)(2) and 6(c) of this Act if administratively necessary;]
(4)(A) that the State agency shall periodically
require each household to cooperate in a
redetermination of the eligibility of the household.
(B) A redetermination under subparagraph (A) shall--
(i) be based on information supplied by the
household; and
(ii) conform to standards established by the
Secretary.
(C) The interval between redeterminations of
eligibility under subparagraph (A) shall not exceed the
eligibility review period;
(5) the specific standards to be used in determining
the eligibility of applicant households which shall be
in accordance with sections 5 and 6 of this Act and
shall include no additional requirements imposed by the
State agency;
* * * * * * *
(10) for the granting of a fair hearing and a prompt
determination thereafter to any household aggrieved by
the action of the State agency under any provision of
its plan of operation as it affects the participation
of such household in the food stamp program or by a
claim against the household for an overissuance:
Provided, That any household which timely requests such
a fair hearing after receiving individual notice of
agency action reducing or terminating its benefits
[within the household's certification period] shall
continue to participate and receive benefits on the
basis authorized immediately prior to the notice of
adverse action until such time as the fair hearing is
completed and an adverse decision rendered [or until
such time as the household's certification period
terminates, whichever occurs earlier], except that in
any case in which the State agency receives from the
household a written statement containing information
that clearly requires a reduction or termination of the
household's benefits, the State agency may act
immediately to reduce or terminate the household's
benefits and may provide notice of its action to the
household as late as the date on which the action
becomes effective. At the option of a State, at any
time prior to a fair hearing determination under this
paragraph, a household may withdraw, orally or in
writing, a request by the household for the fair
hearing. If the withdrawal request is an oral request,
the State agency shall provide a written notice to the
household confirming the withdrawal request and
providing the household with an opportunity to request
a hearing;
(11) upon receipt of a request from a household, for
the prompt restoration in the form of coupons to a
household of any allotment or portion thereof which has
been wrongfully denied or terminated, except that
allotments shall not be restored for any period of time
more than one year prior to the date the State agency
receives a request for such restoration from a
household or the State agency is notified or otherwise
discovers that a loss to a household has occurred;
(12) for the submission of such reports and other
information as from time to time may be required by the
Secretary;
* * * * * * *
(16) notwithstanding paragraph (8) of this
subsection, for the immediate reporting to the
Immigration and Naturalization Service by the State
agency of a determination by personnel responsible [for
the certification or recertification] determining the
eligibility of households that any member of a
household is ineligible to receive food stamps because
that member is present in the United States in
violation of the Immigration and Nationality Act [(8
U.S.C. 1101 et seq.)];
(17) at the option of the State agency, for the
establishment and operation of an automatic data
processing and information retrieval system that meets
such conditions as the Secretary may prescribe and that
is designed to provide efficient and effective
administration of the food stamp program;
* * * * * * *
[(2) Grants.--
[(A) In general.--The Secretary shall make
available not more than $600,000 for each of
fiscal years 1998 through 2001 to pay the
Federal share of grants made to eligible
private nonprofit organizations and State
agencies to carry out subparagraph (B).
[(B) Eligibility.--A private nonprofit
organization or State agency shall be eligible
to receive a grant under subparagraph (A) if
the organization or agency agrees--
[(i) to use the funds to direct a
collaborative effort to coordinate and
integrate nutrition education into
health, nutrition, social service, and
food distribution programs for food
stamp participants and other low-income
households; and
[(ii) to design the collaborative
effort to reach large numbers of food
stamp participants and other low-income
households through a network of
organizations, including schools, child
care centers, farmers' markets, health
clinics, and outpatient education
services.
[(C) Preference.--In deciding between 2 or
more private nonprofit organizations or State
agencies that are eligible to receive a grant
under subparagraph (B), the Secretary shall
give a preference to an organization or agency
that conducted a collaborative effort described
in subparagraph (B) and received funding for
the collaborative effort from the Secretary
before the date of enactment of this paragraph.
[(D) Federal share.--
[(i) In general.--Subject to
subparagraph (E), the Federal share of
a grant under this paragraph shall be 50
percent.
[(ii) No in-kind contributions.--The
non-Federal share of a grant under this
paragraph shall be in cash.
[(iii) Private funds.--The non-
Federal share of a grant under this
paragraph may include amounts from
private nongovernmental sources.
[(E) Limit on individual grant.--The Federal
share of a grant under subparagraph (A) may not
exceed $200,000 for a fiscal year.]
(2) Nutrition education clearinghouse.--The Secretary
shall--
(A) request State agencies to submit to the
Secretary descriptions of successful nutrition
education programs designed for use in the food
stamp program and other nutrition assistance
programs;
(B) make the descriptions submitted under
subparagraph (A) available on the website of
the Department of Agriculture; and
(C) inform State agencies of the availability
of the descriptions on the website.
* * * * * * *
(q) Denial of Food Stamps for Prisoners.--The Secretary
shall assist States, to the maximum extent practicable, in
implementing a system to conduct computer matches or other
systems to prevent prisoners described in section 11(e)(20)(B)
from participating in the food stamp program as a member of any
household.
(r) Denial of Food Stamps for Deceased Individuals.--Each
State agency shall--
(1) enter into a cooperative arrangement with the
Commissioner of Social Security, pursuant to the
authority of the Commissioner under section 205(r)(3)
of the Social Security Act (42 U.S.C. 405(r)(3)), to
obtain information on individuals who are deceased; and
(2) use the information to verify and otherwise
ensure that benefits are not issued to individuals who
are deceased.
(s) Transitional Benefits Option.--
(1) In general.--A State agency may provide
transitional food stamp benefits to a household that
ceases to receive cash assistance under a State program
funded under part A of title IV of the Social Security
Act (42 U.S.C. 601 et seq.).
(2) Transitional benefits period.--Under paragraph
(1), a household may continue to receive food stamp
benefits for a period of not more than 6 months after
the date on which cash assistance is terminated.
(3) Amount of benefits.--During the transitional
benefits period under paragraph (2), a household shall
receive an amount of food stamp benefits equal to the
allotment received in the month immediately preceding
the date on which cash assistance was terminated,
adjusted for--
(A) the change in household income as a
result of the termination of cash assistance;
and
(B) any changes in circumstances that may
result in an increase in the food stamp
allotment of the household and that the
household elects to report.
(4) Determination of future eligibility.--In the
final month of the transitional benefits period under
paragraph (2), the State agency may--
(A) require the household to cooperate in a
redetermination of eligibility; and
(B) initiate a new eligibility review period
for the household without regard to whether the
preceding eligibility review period has
expired.
(5) Limitation.--A household shall not be eligible
for transitional benefits under this subsection if the
household--
(A) loses eligibility under section 6;
(B) is sanctioned for a failure to perform an
action required by Federal, State, or local law
relating to a cash assistance program described
in paragraph (1); or
(C) is a member of any other category of
households designated by the State agency as
ineligible for transitional benefits.
CIVIL MONEY PENALTIES AND DISQUALIFICATION OF RETAIL FOOD STORES AND
WHOLESALE FOOD CONCERNS
* * * * * * *
ADMINISTRATIVE AND JUDICIAL REVIEW
Sec. 14. (a)(1) Whenever an application of a retail food
store or wholesale food concern to participate in the food
stamp program is denied pursuant to section 9 of this Act, or a
retail food store or wholesale food concern is disqualified or
subjected to a civil money penalty under the provisions of
section 12 of this Act, or a retail food store or wholesale
food concern forfeits a bond under section 12(d) of this Act,
or all or part of any claim of a retail food store or wholesale
food concern is denied under the provisions of section 13 of
this Act, or a claim against a State agency is stated pursuant
to the provisions of section 13 of this Act, notice of such
administrative action shall be issued to the retail food store,
wholesale food concern, or State agency involved.
[(2) Such notice shall be delivered by certified mail or
personal service.]
(2) Delivery of notices._A notice under paragraph (1) shall
be delivered by any form of delivery that the Secretary
determines will provide evidence of the delivery.
(3) If such store, concern, or State agency is aggrieved by
such action, it may, in accordance with regulations promulgated
under this Act, within ten days of the date of delivery of such
notice, file a written request for an opportunity to submit
information in support of its position to such person or
persons as the regulations may designate.
* * * * * * *
Sec. 16. (a) Subject to subsection (k), the Secretary is
authorized to pay to each State agency an amount equal to 50
per centum of all administrative costs involved in each State
agency's operation of the food stamp program, which costs shall
include, but not be limited to, the cost of (1) the
certification of applicant households, (2) the acceptance,
storage, protection, control, and accounting of coupons after
their delivery to receiving points within the State, (3) the
issuance of coupons to all eligible households, (4) food stamp
informational activities, including those undertaken under
section 11(e)(1)(A), but not including recruitment activities,
(5) fair hearings, (6) automated data processing and
information retrieval systems subject to the conditions set
forth in subsection (g), (7) food stamp program investigations
and prosecutions, and (8) implementing and operating the
immigration status verification system established under
section 1137(d) of the Social Security Act (42 U.S.C.
1320b097(d)): Provided, That the Secretary is authorized at the
Secretary's discretion to pay any State agency administering
the food stamp program on all or part of an Indian reservation
under section 11(d) of this Act or in a Native village within
the State of Alaska identified in section 11(b) of Public Law
9209203, as amended. Such amounts for administrative costs as
the Secretary determines to be necessary for effective
operation of the food stamp program, as well as to permit each
State to retain 35 percent of the value of all funds or
allotments recovered or collected pursuant to sections 6(b) and
13(c) and 20 percent of the value of any other funds or
allotments recovered or collected, except the value of funds or
allotments recovered or collected that arise from an error of a
State agency. The officials responsible for making
determinations of ineligibility under this Act shall not
receive or benefit from revenues retained by the State under
the provisions of this subsection.
* * * * * * *
(c)(1) The program authorized under this Act shall include
a system that [enhances payment accuracy by establishing fiscal
incentives that require State agencies with high error rates to
share in the cost of payment error and provide enhanced
administrative funding to States with the lowest error rates.
Under such system--]
[(A) the Secretary] enhances payment accuracy and
that has the following elements:
(A) Enhanced administrative funding._With respect to
fiscal year 2001, the Secretary shall adjust a State
agency's federally funded share of administrative costs
pursuant to subsection (a), other than the costs
already shared in excess of 50 percent under the
proviso in the first sentence of subsection (a) or
under subsection (g), by increasing such share of all
such administrative costs by [one percentage point to a
maximum of 60] 1/2 of 1 percentage point to a maximum
of 55 percent of all such administrative costs for each
full one-tenth of a percentage point by which the
payment error rate is less than 6 percent, except that
only States whose rate of invalid decisions in denying
eligibility is less than a nationwide percentage that
the Secretary determines to be reasonable shall be
entitled to the adjustment prescribed in this
subsection;.
[(B) the Secretary shall foster management
improvements by the States by requiring State agencies
other than those receiving adjustments under
subparagraph (A) to develop and implement corrective
action plans to reduce payment errors; and]
(B) Investigation and initial sanctions._
(i) Investigation.--Except as provided under
subparagraph (C), for any fiscal year in which
the Secretary determines that a 95 percent
statistical probability exists that the payment
error rate of a State agency exceeds the
national performance measure for payment error
rates announced under paragraph (6) by more
than 1 percentage point, other than for good
cause shown, the Secretary shall investigate
the administration by the State agency of the
food stamp program unless the Secretary
determines that sufficient information is
already available to review the administration
by the State agency.
(ii) Initial sanctions.--If an investigation
under clause (i) results in a determination
that the State agency has been seriously
negligent (as determined under standards
promulgated by the Secretary), the State agency
shall pay the Secretary an amount that reflects
the extent of such negligence (as determined
under standards promulgated by the Secretary),
not to exceed 5 percent of the amount provided
to the State agency under subsection (a) for
the fiscal year.
(C) Additional sanctions.--If, for any fiscal year,
the Secretary determines that a 95 percent statistical
probability exists that the payment error rate of a
State agency exceeds the national performance measure
for payment error rates announced under paragraph (6)
by more than 1 percentage point, other than for good
cause shown, and that the State agency was sanctioned
under this paragraph or was the subject of an
investigation or review under subparagraph (B)(i) for
each of the 2 immediately preceding fiscal years, the
State agency shall pay to the Secretary an amount equal
to the product obtained by multiplying--
(i) the value of all allotments issued by the
State agency in the fiscal year;
(ii) the lesser of--
(I) the ratio that--
(aa) the amount by which the
payment error rate of the State
agency for the fiscal year
exceeds by more than 1
percentage point the national
performance measure for the
fiscal year; bears to
(bb) 10 percent; or
(II) 1; and
(iii) the amount by which the payment error
rate of the State agency for the fiscal year
exceeds by more than 1 percentage point the
national performance measure for the fiscal
year.
(D) Corrective action plans.--The Secretary shall
foster management improvements by the States by
requiring State agencies to develop and implement
corrective action plans to reduce payment errors.
[(C) for any fiscal year in which a State agency's
payment error rate exceeds the national performance
measure for payment error rates announced under
paragraph (6), other than for good cause shown, the
State agency shall pay to the Secretary an amount equal
to--
[(i) the product of--
[(I) the value of all allotments
issued by the State agency in the
fiscal year; times
[(II) the lesser of--
[(aa) the ratio of--
[(aaa) the amount by
which the payment error
rate of the State
agency for the fiscal
year exceeds the
national performance
measure for the fiscal
year; to
[(bbb) the national
performance measure for
the fiscal year, or
[(bb) 1; times
[(III) the amount by which the
payment error rate of the State agency
for the fiscal year exceeds the
national performance measure for the
fiscal year. The amount of liability
shall not be affected by corrective
action under subparagraph (B).]
(2) As used in this section--
(A) the term ``payment error rate'' means the sum of
the point estimates of an overpayment error rate and an
underpayment error rate determined by the Secretary
from data collected in a probability sample of
participating households, as adjusted downward as
appropriate under paragraph (10);
(B) the term ``overpayment error rate'' means the
percentage of the value of all allotments issued in a
fiscal year by a State agency that are either--
* * * * * * *
(B) Errors resulting from the use by a State agency
of correctly processed information concerning
households or individuals received from Federal
agencies or from actions based on policy information
approved or disseminated, in writing, by the Secretary
or the Secretary's designee.
[(4) The Secretary may require a State agency to report any
factors that the Secretary considers necessary to determine a
State agency's payment error rate, enhanced administrative
funding, or claim for payment error, under this subsection.]
(4) Reporting requirements.--The Secretary may require a
State agency to report any factors that the Secretary considers
necessary to determine a State agency's payment error rate,
enhanced administrative funding, claim for payment error under
paragraph (1), or performance under the performance measures
under paragraph (11). If a State agency fails to meet the
reporting requirements established by the Secretary, the
Secretary shall base the determination on all pertinent
information available to the Secretary.
[(5) To facilitate the implementation of this subsection
each State agency shall submit to the Secretary expeditiously
data regarding its operations in each fiscal year sufficient
for the Secretary to establish the payment error rate for the
State agency for such fiscal year and determine the amount of
either incentive payments under paragraph (1)(A) or claims
underparagraph (1)(C). The Secretary shall make a determination
for a fiscal year, and notify the State agency of such determination,
within nine months following the end of each fiscal year.]
(5) Procedures.--To facilitate the implementation of this
subsection, each State agency shall expeditiously submit to the
Secretary data concerning the operations of the State agency in
each fiscal year sufficient for the Secretary to establish the
payment error rate for the State agency for the fiscal year, to
comply with paragraph (10), and to determine the amount of
enhanced administrative funding under paragraph (1)(A), high
performance bonus payments under paragraph (11), or claims
under subparagraph (B) or (C) of paragraph (1). The Secretary
shall initiate efforts to collect the amount owed by the State
agency as a claim established under paragraph (1)(C) for a
fiscal year, subject to the conclusion of any formal or
informal appeal procedure and administrative or judicial review
under section 14 (as provided for in paragraph (7)), before the
end of the fiscal year following such fiscal year.
(6) At the time the Secretary makes the notification to
State agencies of their error rates and incentive payments or
claims pursuant to paragraphs (1)(A) and (1)(C), the Secretary
shall also announce a national performance measure that shall
be the sum of the products of each State agency's error rate as
developed for the notifications under paragraph (8) (but
determined without regard to paragraph (10)) times that State
agency's proportion of the total value of national allotments
issued for the fiscal year using the most recent issuance data
available at the time of the notifications issued pursuant to
paragraph (8). Where a State fails to meet reporting
requirements pursuant to paragraph (4), the Secretary may use
another measure of a State's error developed pursuant to
paragraph (8), to develop the national performance measure. The
announced national performance measure shall be used in
determining the State share of the cost of payment error under
paragraph (1)(C) for the fiscal year whose error rates are
being announced under paragraph (8).
(7) If the Secretary asserts a financial claim against a
State agency under paragraph (1)(C), the State may seek
administrative and judicial review of the action pursuant to
section 14.
(8)(A) This paragraph applies to the determination of
whether a payment is due by a State agency for a fiscal year
under paragraph (1)(C).
(B) Not later than [180 days after the end of the fiscal
year] the first May 31 after the end of the fiscal year
referred to in subparagraph (A), the case review and all
arbitrations of State-Federal difference cases shall be
completed.
(C) Not later than [30 days thereafter] the first June 30
after the end of the fiscal year referred to in subparagraph
(A), the Secretary shall--
* * * * * * *
(E) a significant circumstance beyond the control of the
State agency.
(10) Adjustments of payment error rate.--
(A) Fiscal year 2002.--
(i) Adjustment for higher percentage of
households with earned income.--Subject to
subparagraph (E), with respect to fiscal year
2002, in applying paragraph (1), the Secretary
shall adjust the payment error rate determined
under paragraph (2)(A) as necessary to take
into account any increases in errors that
result from the State agency's serving a higher
percentage of households with earned income
than the lesser of--
(I) the percentage of households with
earned income that receive food stamps
in all States; or
(II) the percentage of households
with earned income that received food
stamps in the State in fiscal year
1992.
(ii) Adjustment for higher percentage of
households with non-citizen members.--Subject
to subparagraph (B), with respect to fiscal
year 2002, in applying paragraph (1), the
Secretary shall adjust the payment error rate
determined under paragraph (2)(A) as necessary
to take into account any increases in errors
that result from the State agency's serving a
higher percentage of households with 1 or more
members who are not United States citizens than
the lesser of--
(I) the percentage of households with
1 or more members who are not United
States citizens that receive food
stamps in all States: or
(II) the percentage of households
with 1 or more members who are not
United States citizens that received
food stamps in the State in fiscal year
1998.
(B) Expanded applicability to state agencies subject
to sanctions.--In the case of a State agency subject to
sanctions for fiscal year 2001 or any fiscal year
thereafter under paragraph (1), the adjustments
described in subparagraph (A) shall apply to the State
agency for the fiscal year.
(C) Additional adjustments.--For fiscal year 2003 and
each fiscal year thereafter, the Secretary may make
such additional adjustments to the payment error rate
determined under paragraph (2)(A) as the Secretary
determines to be consistent with achieving the purposes
of this Act.
(11) High performance bonus payments.--
(A) In general.--The Secretary shall--
(i) with respect to fiscal year 2002 and each
fiscal year thereafter, measure the performance
of each State agency with respect to each of
the performance measures specified in
subparagraph (B); and
(ii) in fiscal year 2003 and each fiscal year
thereafter, subject to subparagraphs (C)
and (D), make high performance bonus payments
to the State agencies with the highest or most
improved performance with respect to those
performance measures.
(B) Performance measures.--The performance measures
specified in this subparagraph are--
(i) the ratio, expressed as a percentage,
that--
(I) the number of households in the
State that--
(aa) receive food stamps;
(bb) have incomes less than
130 percent of the poverty line
(as defined in section 673 of
the Community Services Block
Grant Act (42 U.S.C. 9902));
(cc) have annual earnings
equal to at least 1000 times
the Federal minimum hourly rate
under the Fair Labor Standards
Act of 1938 (29 U.S.C. 201 et
seq.); and
(dd) have children under age
18; bears to
(II) the number of households in the
State that meet the criteria specified
in items (bb) through (dd) of subclause
(I); and
(ii) 4 additional performance measures,
established by the Secretary in consultation
with the National Governors Association, the
American Public Human Services Association, and
the National Conference of State Legislatures
not later than 180 days after the date of
enactment of this paragraph, of which not less
than 1 performance measure shall relate to
provision of timely and appropriate services to
applicants for and recipients of food stamp
benefits.
(C) High performance bonus payments.--
(i) Definition of caseload.--In this
subparagraph, the term ``caseload'' has the
meaning given the term in section 6(o)(6)(A).
(ii) Amount of payments.--
(I) In general.--In fiscal year 2003
and each fiscal year thereafter, the
Secretary shall--
(aa) make 1 high performance
bonus payment of $6,000,000 for
each of the 5 performance
measures under subparagraph
(B); and
(bb) allocate the high
performance bonus payment with
respect to each performance
measure in accordance with
subclauses (II) and (III).
(II) Payment for performance
measures.--In fiscal year 2003 and each
fiscal year thereafter, the Secretary
shall allocate, in accordance with
subclause (III), the high performance
bonus payment made for each performance
measure under subparagraph (B) among
the 6 State agencies with, as
determined by the Secretary by
regulation--
(aa) the greatest improvement
in the level of performance
with respect to the performance
measure between the 2 most
recent years for which the
Secretary determines that
reliable data are available; or
(bb) the highest performance
in the performance measure for
the most recent year for which
the Secretary determines that
reliable data are available; or
(cc) a combination of the
greatest improvement described
in item (aa) and the highest
performance described in item
(bb).
(III) Allocation among state agencies
eligible for payments.--A high
performance bonus payment under
subclause (II) or made for a
performance measure shall be allocated
among the State agencies eligible for
the payment in the ratio that--
(aa) the caseload of each of
the 6 State agencies eligible
for the payment; bears to
(bb) the caseloads of the 6
State agencies eligible for the
payment.
(D) Prohibition on receipt of high performance bonus
payments by state agencies subject to sanctions.--If,
for any fiscal year, a State agency is subject to a
sanction under paragraph (1), the State agency shall
not be eligible for a high performance bonus payment
for the fiscal year.
(E) Payments not subject to judicial review.--A
determination by the Secretary whether, and in what
amount, to make a high performance bonus payment under
this paragraph shall not be subject to judicial review.
(d) The Secretary shall undertake the following studies of
the payment error improvement system established under
subsection (c):
* * * * * * *
(1) In general.--
(A) Amounts.--To carry out employment and
training programs, the Secretary shall reserve
for allocation to State agencies[, to remain
available until expended,] from funds made
available for each fiscal year under section
18(a)(1) the amount of--
(i) for fiscal year 1996,
$75,000,000;
(ii) for fiscal year 1997,
$79,000,000;
(iii) for fiscal year 1998--
(I) $81,000,000; and
(II) an additional amount of
$131,000,000;
(iv) for fiscal year 1999--
(I) $84,000,000; and
(II) an additional amount of
$31,000,000;
(v) for fiscal year 2000--
(I) $86,000,000; and
(II) an additional amount of
$86,000,000;
(vi) for fiscal year 2001--
(I) $88,000,000; and
(II) an additional amount of
$131,000,000; and
[(vii) for fiscal year 2002--]
(vii) for each of fiscal years 2002
through 2006, $90,000,000, to remain
available until expended.
[(I) $90,000,000; and
[(II) an additional amount of
$75,000,000.
[(B) Allocation.--
[(i) Allocation formula.--The
Secretary shall allocate the amounts
reserved under subparagraph (A) among
the State agencies using a reasonable
formula, as determined and adjusted by
the Secretary each fiscal year, to
reflect--
[(I) changes in each State's
caseload (as defined in section
6(o)(6)(A));
[(II) for fiscal year 1998,
the portion of food stamp
recipients who reside in each
State who are not eligible for
an exception under section
6(o)(3); and
[(III) for each of fiscal
years 1999 through 2002, the
portion of food stamp
recipients who reside in each
State who are not eligible for
an exception under section
6(o)(3) and who--
[(aa) do not reside
in an area subject to a
waiver granted by the
Secretary under section
6(o)(4); or
[(bb) do reside in an
area subject to a
waiver granted by the
Secretary under section
6(o)(4), if the State
agency provides
employment and training
services in the area to
food stamp recipients
who are not eligible
for an exception under
section 6(o)(3).
[(ii) Estimated factors.--The
Secretary shall estimate the portion of
food stamp recipients who reside in
each State who are not eligible for an
exception under section 6(o)(3) based
on the survey conducted to carry out
subsection (c) for fiscal year 1996 and
such other factors as the Secretary
considers appropriate due to the timing
and limitations of the survey.
[(iii) Reporting requirement.--A
State agency shall submit such reports
to the Secretary as the Secretary
determines are necessary to ensure
compliance with this paragraph.]
(B) Allocation.--Funds made available under
subparagraph (A) shall be made available to and
reallocated among State agencies under a
reasonable formula that--
``(i) is determined and adjusted by
the Secretary; and
``(ii) takes into account the number
of individuals who are not exempt from
the work requirement under section
6(o).
(C) Reallocation.--If a State agency will not
expend all of the funds allocated to the State
agency for a fiscal year under subparagraph
(B), the Secretary shall reallocate the
unexpended funds to other States (during the
fiscal year or the subsequent fiscal year) as
the Secretary considers appropriate and
equitable.
(D) Minimum allocation.--Notwithstanding
subparagraph (B), the Secretary shall ensure
that each State agency operating an employment
and training program shall receive not less
than $50,000 for each fiscal year.
[(E) Use of funds.--Of the amount of funds a
State agency receives under subparagraphs (A)
through (D) for a fiscal year, not less than 80
percent of the funds shall be used by the
State agency during the fiscal year to serve food
stamp recipients who--
[(i) are not eligible for an
exception under section 6(o)(3); and
[(ii) are placed in and comply with a
program described in subparagraph (B)
or (C) of section 6(o)(2).
[(F) Maintenance of effort.--To receive an
allocation of an additional amount made
available under subclause (II) of each of
clauses (iii) through (vii) of subparagraph
(A), a State agency shall maintain the
expenditures of the State agency for employment
and training programs and workfare programs for
any fiscal year under paragraph (2), and
administrative expenses described in section
20(g)(1), at a level that is not less than the
level of the expenditures by the State agency
to carry out the programs and such expenses for
fiscal year 1996.
[(G) Component costs.--The Secretary shall
monitor State agencies' expenditure of funds
for employment and training programs provided
under this paragraph, including the costs of
individual components of State agencies'
programs. The Secretary may determine the
reimbursable costs of employment and training
components, and, if the Secretary makes such a
determination, the Secretary shall determine
that the amounts spent or planned to be spent
on the components reflect the reasonable cost
of efficiently and economically providing
components appropriate to recipient employment
and training needs, taking into account, as the
Secretary deems appropriate, prior expenditures
on the components, the variability of costs
among State agencies' components, the
characteristics of the recipients to be served,
and such other factors as the Secretary
considers necessary.]
(E) Additional allocations for states that
ensure availability of work opportunities.--
(i) In general.--In addition to the
allocations under subparagraph (A),
from funds made available under section
18(a)(1), the Secretary shall allocate
not more than $25,000,000 for each of
fiscal years 2002 through 2006 to
reimburse a State agency that is
eligible under clause (ii) for the
additional costs incurred in serving
food stamp recipients who--
(I) are not eligible for an
exception under section
6(o)(3); and
(II) are placed in and comply
with a program described in
subparagraph (B) or (C) of
section 6(o)(2).
(ii) Eligibility.--To be eligible for
an additional allocation under clause
(i), a State agency shall--
(I) exhaust the allocation to
the State agency under
subparagraph (A) (including any
reallocation that has been made
available under subparagraph
(C)); and
(II) make and comply with a
commitment to offer a position
in a program described in
subparagraph (B) or (C) of
section 6(o)(2) to each
applicant or recipient who--
(aa) is in the last
month of the 6-month
period described in
section 6(o)(2);
(bb) is not eligible
for an exception under
section 6(o)(3);
(cc) is not eligible
for a waiver under
section 6(o)(4); and
(dd) is not eligible
for an exemption under
section 6(o)(6).
(3) Reduction in payment.--
(A) In general.--Notwithstanding any other
provision of this section, effective for each
of fiscal years 1999 through [2002] 2006, the
Secretary shall reduce, for each fiscal year,
the amount paid under subsection (a) to each
State by an amount equal to the amount
determined for the food stamp program under
paragraph (2)(B). The Secretary shall, to the
extent practicable, make the reductions
required by this paragraph on a quarterly
basis.
(B) Application.--If the Secretary of Health
and Human Services does not make the
determinations required by paragraph (2) by
September 30, 1999--
(i) during the fiscal year in which
the determinations are made, the
Secretary shall reduce the amount paid
under subsection (a) to each State by
an amount equal to the sum of the
amounts determined for the food stamp
program under paragraph (2)(B) for
fiscal year 1999 through the fiscal
year during which the determinations
are made; and
(ii) for each subsequent fiscal year
through fiscal year [2002] 2006,
subparagraph (A) applies.
(4) Appeal of determinations.--
* * * * * * *
(ii) Review.--The Board shall review
the decision on the record.
(iii) Deadline.--Not later than 60
days after the date on which the appeal
is filed, the Board shall--
(I) make a final decision
with respect to an appeal filed
under clause (i); and
(II) notify the chief
executive officer of the State
of the decision.
(D) Judicial review.--The determinations of
the Secretary of Health and Human Services
under paragraph (2), and a final decision of
the administrative law judge or Board under
subparagraphs (B) and (C), respectively, shall
not be subject to judicial review.
(E) Reduced payments pending appeal.--The
pendency of an appeal under this paragraph
shall not affect the requirement that the
Secretary reduce payments in accordance with
paragraph (3).
(5) Allocation of administrative costs.--
(A) In general.--[No funds] Except as
provided in subparagraph (C), no funds or
expenditures described in subparagraph (B) may
be used to pay for costs--
* * * * * * *
(B) Funds and expenditures.--Subparagraph (A)
applies to--
(i) funds made available to carry out
part A of title IV, or title XX, of the
Social Security Act (42 U.S.C. 601 et
seq., 1397 et seq.);
(ii) expenditures made as qualified
State expenditures (as defined in
section 409(a)(7)(B) of that Act (42
U.S.C. 609(a)(7)(B)));
(iii) any other Federal funds (except
funds provided under subsection (a));
and
(iv) any other State funds that are--
(I) expended as a condition
of receiving Federal funds; or
(II) used to match Federal
funds under a Federal program
other than the food stamp
program.
(C) Food stamp informational activities.--
Subparagraph (A) shall not apply to any funds
or expenditures described in clause (i) or (ii)
of subparagraph (B) used to pay the costs of
any activity that is eligible for reimbursement
under subsection (a)(4).
research, demonstration, and evaluations
Sec. 17. (a)(1) The Secretary may[, by way of making make
contracts with or grants to public or private organizations or
agencies,] enter into contracts with or make grants to public
or private organizations or agencies under this section to
undertake research that will help improve the administration
and effectiveness of the food stamp program in delivering
nutrition-related benefits. The waiver authority of the
Secretary under subsection (b) shall extend to all contracts
and grants under this section.
* * * * * * *
(iii) Restrictions on permissible
projects.--If the Secretary finds that
a project under subparagraph (A) would
reduce benefits by more than 20 percent
for more than 5 percent of households
in the area subject to the project (not
including any household whose benefits
are reduced due to a failure to comply
with work or other conduct
requirements), the project--
(I) may not include more than
15 percent of the State's food
stamp households; and
(II) shall continue for not
more than 5 years after the
date of implementation, unless
the Secretary approves an
extension requested by the
State agency at any time.
(iv) Impermissible projects.--The
Secretary may not conduct a project
under subparagraph (A) that--
(I) involves the payment of
the value of an allotment in
the form of cash, unless the
project was approved prior to
the date of enactment of this
subparagraph [August 22, 1996];
(II) has the effect of
substantially transferring
funds made available under this
Act to services or benefits
provided primarily through
another public assistance
program, or using the funds for
any purpose other than the
purchase of food, program
administration, or an
employment or training program;
(III) is inconsistent with--
(aa) [the last 2
sentences of section
3(i)] paragraphs (4)
and (5) of section
3(i);
* * * * * * *
(g) In order to assess the effectiveness of the employment
and training programs established under section 6(d) in placing
individuals into the work force and withdrawing such
individuals from the food stamp program, the Secretary is
authorized to carry out studies comparing the pre- and post-
program labor force participation, wage rates, family income,
level of receipt of food stamp and other transfer payments, and
other relevant information, for samples of participants in such
employment and training programs as compared to the appropriate
control or comparison groups that did not participate in such
programs. Such studies shall, to the maximum extent possible--
(1) collect such data for up to 3 years after the
individual has completed the employment and training
program; and
(2) yield results that can be generalized to the
national program as a whole.
The results of such studies and reports shall be considered
in developing or updating the performance standards required
under section 6.
[(h) The Secretary shall conduct a sufficient number of
demonstration projects to evaluate the effects, in both rural
and urban areas, of including in financial resources under
section 5(g) the fair market value of licensed vehicles to the
extent the value of each vehicle exceeds $4,500, but excluding
the value of--
[(1) any licensed vehicle that is used to produce
earned income, necessary for transportation of an
elderly or physically disabled household member, or
used as the household's home; and
[(2) one licensed vehicle used to obtain, continue,
or seek employment (including travel to and from work),
used to pursue employment-related education or
training, or used to secure food or the benefits of the
food stamp program.]
(h) Access and Outreach Pilot Projects._
(1) In general.--The Secretary shall make grants to
State agencies and other entities to pay the Federal
share of the eligible costs of projects to improve--
(A) access by eligible individuals to
benefits under the food stamp program; or
(B) outreach to individuals eligible for
those benefits.
(2) Federal share.--The Federal share shall be 75
percent.
(3) Types of projects.--To be eligible for a grant
under this subsection, a project may consist of--
(A) establishing a single site at which
individuals may apply for--
(i) benefits under the food stamp
program; and
(I) supplemental security
income benefits under title XVI
of the Social Security Act (42
U.S.C. 1381 et seq.);
(II) benefits under the
medicaid program under title
XIX of the Social Security Act
(42 U.S.C. 1396 et seq.);
(III) benefits under the
State children's health
insurance program under title
XXI of the Social Security Act
(42 U.S.C. 1397aa et seq.);
(IV) benefits under the
special supplemental nutrition
program for women, infants, and
children under section 17 of
the Child Nutrition Act of 1966
(42 U.S.C. 1786); and
(V) benefits under such other
programs as the Secretary
determines to be appropriate;
(B) developing forms that allow an individual
to apply for more than 1 of the programs
referred to in subparagraph (A);
(C) dispatching State agency personnel to
conduct outreach and enroll individuals in the
food stamp program and other programs in
nontraditional venues (such as shopping malls,
schools, community centers, county fairs,
clinics, food banks, and job training centers);
(D) developing systems to enable increased
participation in the provision of benefits
under the food stamp program through farmers'
markets, roadside stands, and other community-
supported agriculture programs, including
wireless electronic benefit transfer systems
and other systems appropriate to open-air
settings where farmers and other vendors sell
directly to consumers;
(E) allowing individuals to submit
applications for the food stamp program by
means of the telephone or the Internet, in
particular individuals who live in rural areas,
elderly individuals, and individuals with
disabilities;
(F) encouraging consumption of fruit and
vegetables by developing a cost-effective
system for providing discounts for purchases of
fruit and vegetables made through use of
electronic benefit transfer cards;
(G) reducing barriers to participation by
individuals, with emphasis on working families,
eligible immigrants, elderly individuals, and
individuals with disabilities;
(H) developing training materials,
guidebooks, and other resources to improve
access and outreach;
(I) conforming verification practices under
the food stamp program with verification
practices under other assistance programs; and
(J) such other activities as the Secretary
determines to be appropriate.
(4) Selection.--
(A) In general.--The Secretary shall develop
criteria for selecting recipients of grants
under this subsection that include the
consideration of--
(i) the demonstrated record of a
State agency or other entity in serving
low-income individuals;
(ii) the ability of a State agency or
other entity to reach hard-to-serve
populations;
(iii) the level of innovative
proposals in the application of a State
agency or other entity for a grant; and
(iv) the development of partnerships
between public and private sector
entities and linkages with the
community.
(B) Preference.--In selecting recipients of
grants under paragraph (1), the Secretary shall
provide a preference to any applicant that
consists of a partnership between a State and a
private entity, such as--
(i) a food bank;
(ii) a community-based organization;
(iii) a public school;
(iv) a publicly-funded health clinic;
(v) a publicly-funded day care
center; and
(vi) a nonprofit health or welfare
agency.
(C) Geographical distribution of
recipients.--
(i) In general.--Subject to clause
(ii), the Secretary shall select, from
all eligible applications received, at
least 1 recipient to receive a grant
under this subsection from--
(I) each region of the
Department of Agriculture
administering the food stamp
program; and
(II) each additional rural or
urban area that the Secretary
determines to be appropriate.
(ii) Exception.--The Secretary shall
not be required to select grant
recipients under clause (i) to the
extent that the Secretary determines
that an insufficient number of eligible
grant applications has been received.
(5) Project evaluations.--
(A) In general.--The Secretary shall conduct
evaluations of projects funded by grants under
this subsection.
(B) Limitation.--Not more than 10 percent of
funds made available to carry out this
subsection shall be used for project
evaluations described in subparagraph (A).
(6) Maintenance of effort.--A State agency or other
entity shall provide assurances to the Secretary that
funds provided to the State agency or other entity
under this subsection will be used only to supplement,
not to supplant, the amount of Federal, State, and
local funds otherwise expended to carry out access and
outreach activities in the State under this Act.
(7) Funding.--There is authorized to be appropriated
to carry out this subsection $3,000,000 for the period
of fiscal years 2003 through 2005.
(i)(1)(A) Subject to the availability of funds specifically
appropriated to carry out this subsection and subject to the
other provisions of this subsection, during each of fiscal
years 1992 through [2002] 2006, the Secretary shall make grants
competitively awarded to public or private nonprofit
organizations to fund food stamp outreach demonstration
projects (hereinafter in this subsection referred to as the
``projects'') and related evaluations in areas of the United
States to increase participation by eligible low-income
households in the food stamp program. The total amount of
grants provided during a fiscal year may not exceed $5,000,000.
Funds appropriated to carry out this subsection shall be used
in the year during which the funds are appropriated. Not more
than 20 percent of the funds appropriated to carry out this
subsection shall be used for evaluations.
* * * * * * *
authorization for appropriations
Sec. 18. (a)(1) To carry out this Act, there are authorized
to be appropriated such sums as are necessary for each of the
fiscal years 1996 through [2002] 2006. Not to exceed one-fourth
of 1 per centum of the previous year's appropriation is
authorized in each such fiscal year to carry out the provisions
of section 17 of this Act, subject to paragraph (3).
* * * * * * *
block grant
Sec. 19. (a)(1)(A) From the sums appropriated under this
Act, the Secretary shall, subject to the provisions of this
section, pay to [the Commonwealth of Puerto Rico] governmental
entities specified in subparagraph (D)--
(i) for fiscal year 2000, $1,268,000,000;
(ii) for fiscal year 2001, the amount required to be
paid under clause (i) for fiscal year 2000, as adjusted
by the change in the Food at Home series of the
Consumer Price Index for All Urban Consumers, published
by the Bureau of Labor Statistics of the Department of
Labor, for the most recent 12-month period ending in
June;[ and
[(iii) for fiscal year 2002, the amount required to
be paid under clause (ii) for fiscal year 2001, as
adjusted by the percentage by which the thrifty food
plan is adjusted for fiscal year 2002 under section
3(o)(4);]
(iii) for fiscal year 2002, $1,356,000,000; and
(iv) for each of fiscal years 2003 through 2006, the
amount provided in clause (iii), as adjusted by the
percentage by which the thrifty food plan has been
adjusted under section 3(o)(4) between June 30, 2001,
and June 30 of the immediately preceding fiscal year;
to pay the expenditures for nutrition assistance programs for
needy persons as described in subparagraphs (B) and (C).
[to finance 100 percent of the expenditures for food assistance
provided to needy persons and 50 percent of the administrative
expenses related to the provision of the assistance.]
[(B) The] (B) Maximum payments to commonwealth of puerto
rico._
(i) In general.--The payments to the Commonwealth for
any fiscal year shall not exceed the expenditures by
that jurisdiction during that year for the provision of
the assistance the provision of which is included in
the plan of the Commonwealth approved under subsection
(b) and 50 per centum of the related administrative
expenses.
(ii) Exception for expenditures for certain
systems.--Notwithstanding subparagraph (A) and clause
(i), the Commonwealth of Puerto Rico may spend not more
than $6,000,000 of the amount required to be paid to
the Commonwealth for fiscal year 2002 under
subparagraph (A) to pay 100 percent of the costs of--
(I) upgrading and modernizing the electronic
data processing system used to carry out
nutrition assistance programs for needy
persons; and
(II) implementing systems to simplify the
determination of eligibility to receive that
nutrition assistance; and
(III) operating systems to deliver benefits
through electronic benefit transfers.
(C) American samoa.--For each fiscal year, the Secretary
shall reserve 0.4 percent of the funds made available under
subparagraph (A) for payment to American Samoa to pay 100
percent of the expenditures for a nutrition assistance program
extended under section 601(c) of Public Law 96-597 (48 U.S.C.
1469d(c)).
(D) Governmental entity.--A governmental entity specified
in this subparagraph is--
(i) the Commonwealth of Puerto Rico; and
(ii) for fiscal year 2003 and each fiscal year
thereafter, American Samoa.
* * * * * * *
SEC. 25. ASSISTANCE FOR COMMUNITY FOOD PROJECTS.
* * * * * * *
(b) Authority To Provide Assistance.--
(1) In general.--From amounts made available to carry
out this Act, the Secretary may make grants to assist
eligible private nonprofit entities to establish and
carry out community food projects.
(2) Limitation on grants.--The total amount of funds
provided as grants under this section may not exceed--
(A) $1,000,000 for fiscal year 1996; and
(B) $2,500,000 for each of fiscal years 1997
through [2002] 2006.
(c) Eligible Entities.--To be eligible for a grant under
subsection (b), a private nonprofit entity must--
* * * * * * *
(d) Preference for Certain Projects.--In selecting
community food projects to receive assistance under subsection
(b), the Secretary shall give a preference to projects designed
to--
(1) develop linkages between 2 or more sectors of the
food system;
(2) support the development of entrepreneurial
projects;
(3) develop innovative linkages between the for-
profit and nonprofit food sectors; [or
[(4) encourage long-term planning activities and
multi-system, interagency approaches.]
(4) encourage long-term planning activities, and
multisystem, interagency approaches with
multistakeholder collaborations, that build the long-
term capacity of communities to address the food and
agriculture problems of the communities, such as food
policy councils and food planning associations; or
(5) meet, as soon as practicable, specific
neighborhood, local, or State food and agriculture
needs, including needs for--
(A) infrastructure improvement and
development;
(B) planning for long-term solutions; or
(C) the creation of innovative marketing
activities that mutually benefit farmers and
low-income consumers.
* * * * * * *
(e) Matching Funds Requirements.--
(1) Requirements.--The Federal share of the cost of
establishing or carrying out a community food project
that receives assistance under subsection (b) may not
exceed [50] 75 percent of the cost of the project
during the term of the grant.
* * * * * * *
SEC. 27. AVAILABILITY OF COMMODITIES FOR THE EMERGENCY FOOD ASSISTANCE
PROGRAM.
(a) Purchase of Commodities.--From amounts made available
to carry out this Act, for each of fiscal years [1997 through
2002] 2002 through 2006, the Secretary shall purchase
[$100,000,000] $110,000,000 of a variety of nutritious and
useful commodities of the types that the Secretary has the
authority to acquire through the Commodity Credit Corporation
or under section 32 of the Act entitled ``An Act to amend the
Agricultural Adjustment Act, and for other purposes'', approved
August 24, 1935 (7 U.S.C. 612c), and distribute the commodities
to States for distribution in accordance with section 214 of
the Emergency Food Assistance Act of 1983 (Public Law 98-098; 7
U.S.C. 612c note).
(b) Basis for Commodity Purchases.--In purchasing
commodities under subsection (a), the Secretary shall, to the
extent practicable and appropriate, make purchases based on--
(1) agricultural market conditions;
(2) preferences and needs of States and distributing
agencies; and
(3) preferences of recipients.
(c) Use of Funds for Related Costs.--
(1) In general.--For each of fiscal years 2002
through 2006, the Secretary shall use $10,000,000 of
the funds made available under subsection (a) to pay
the direct and indirect costs of States relating to the
processing, storing, transporting, and distributing to
eligible recipient agencies of--
(A) commodities purchased by the Secretary
under subsection (a); and
(B) commodities acquired from other sources,
including commodities acquired by gleaning (as
defined in section 111(a) of the Hunger
Prevention Act of 1988 (7 U.S.C. 612c note;
Public Law 100-435)).
(2) Allocation of funds.--The amount required to be
used in accordance with paragraph (1) shall be
allocated in accordance with section 204(a) of the
Emergency Food Assistance Act of 1983 (7 U.S.C.
7508(a)).
* * * * * * *
SEC. 28. INNOVATIVE PROGRAMS FOR ADDRESSING COMMON COMMUNITY PROBLEMS.
(a) In General.--The Secretary shall offer to enter into a
contract with a nongovernmental organization described in
subsection (b) to coordinate with Federal agencies, States,
political subdivisions, and nongovernmental organizations
(referred to in this section as `targeted entities') to
develop, and recommend to the targeted entities, innovative
programs for addressing common community problems, including
loss of farms, rural poverty, welfare dependency, hunger, the
need for job training, juvenile crime prevention, and the need
for self-sufficiency by individuals and communities.
(b) Nongovernmental Organization.--The nongovernmental
organization referred to in subsection (a)--
(1) shall be selected on a competitive basis; and
(2) as a condition of entering into the contract--
(A) shall be experienced in working with
targeted entities, and in organizing workshops
that demonstrate programs to targeted entities;
(B) shall be experienced in identifying
programs that effectively address problems
described in subsection (a) that can be
implemented by other targeted entities;
(C) shall agree--
(i) to contribute in-kind resources
toward the establishment and
maintenance of programs described in
subsection (a); and
(ii) to provide to targeted entities,
free of charge, information on the
programs;
(D) shall be experienced in, and capable of,
receiving information from, and communicating
with, targeted entities throughout the United
States; and
(E) shall be experienced in operating a
national information clearinghouse that
addresses 1 or more of the problems described
in subsection (a).
(c) Audits.--The Secretary shall establish auditing
procedures and otherwise ensure the effective use of funds made
available under this section.
(d) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this section, and on October 1,
2002, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary of Agriculture to carry out
this section $200,000, to remain available until
expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
* * * * * * *
RICHARD B. RUSSELL NATIONAL SCHOOL LUNCH ACT
* * * * * * *
(e)(1) Subject to paragraph (2), in each school year the
Secretary shall ensure that not less than 12 percent of the
assistance provided under section 4, this section, and section
11 shall be in the form of--
(A) commodity assistance provided under this section,
including cash in lieu of commodities and
administrative costs for procurement of commodities
under this section; or
(B) during the period beginning October 1, [2001]
2003, and ending September 30, 2009, commodities
provided by the Secretary under any provision of law.
(2) If amounts available to carry out the requirements of
the sections described in paragraph (1) are insufficient to
meet the requirement contained in paragraph (1) for a school
year, the Secretary shall, to the extent necessary, use the
authority provided under section 14(a) to meet the requirement
for the school year.
* * * * * * *
PERSONAL RESPONSIBILITY AND WORK OPPORTUNITY RECONCILIATION ACT OF 1996
* * * * * * *
SEC. 402. LIMITED ELIGIBILITY OF QUALIFIED ALIENS FOR CERTAIN FEDERAL
PROGRAMS.
(a) Limited Eligibility for Specified Federal Programs.--
(1) In general.--Notwithstanding any other provision
of law and except as provided in paragraph (2), an
alien who is a qualified alien (as defined in section
431) is not eligible for any specified Federal program
(as defined in paragraph (3)).
(2) Exceptions.--
(A) Time-limited exception for refugees and
asylees.--With respect to the specified Federal
[programs described in paragraph (3)] program
described in paragraph (3)(A), paragraph (1)
shall not apply to an alien until 7 years after
the date--
(i) an alien is admitted to the
United States as a refugee under
section 207 of the Immigration and
Nationality Act;
* * * * * * *
(B) Certain permanent resident aliens.--
Paragraph (1) shall not apply to an alien who--
(i) is lawfully admitted to the
United States for permanent residence
under the Immigration and Nationality
Act; and
(ii)(I) has worked [40] 40 (or 16, in
the case of the specified Federal
program described in paragraph (3)(B))
qualifying quarters of coverage as
defined under title II of the Social
Security Act or can be credited with
such qualifying quarters as provided
under section 435, and (II) in the case
of any such qualifying quarter creditable
for any period beginning after December
31, 1996, did not receive any Federal
means-tested public benefit (as provided
under section 403) during any such period.
(C) Veteran and active duty exception.--
Paragraph (1) shall not apply to an alien who
is lawfully residing in any State and is--
* * * * * * *
(F) Disabled aliens lawfully residing in the
united states on august 22, 1996.--With respect
to eligibility for benefits for the specified
Federal programs described in paragraph (3),
paragraph (1) shall not apply to an alien who--
[(i) was lawfully residing in the
United States on August 22, 1996; and
[(ii)(I) in the case] (i) in the case
of the specified Federal program
described in paragraph (3)(A)--
``(I) was lawfully residing
in the United States on August
22, 1996; and
``(II) is blind or disabled,
as defined in paragraph (2) or
(3) of section 1614(a) of the
Social Security Act (42 U.S.C.
1382c(a)); and
``(ii) in the case of the specified
Federal program described in paragraph
(3)(A), is blind or disabled, as
defined in section 1614(a)(2) or
1614(a)(3) of the Social Security Act
(42 U.S.C. 1382c(a)(3)); and
* * * * * * *
(J) Food stamp exception for certain
children.--With respect to eligibility for
benefits for the specified Federal program
described in paragraph (3)(B), paragraph (1)
shall not apply to any individual [who--
[(i) was lawfully residing in the
United States on August 22, 1996; and
[(ii) is under] 18 years of age.
(K) Food stamp exception for certain hmong
and highland laotians.--With respect to
eligibility for benefits for the specified
Federal program described in paragraph (3)(B),
paragraph (1) shall not apply to--
* * * * * * *
(IV) an alien is granted
status as a Cuban and Haitian
entrant (as defined in section
501(e) of the Refugee Education
Assistance Act of 1980); or
(V) an alien admitted to the
United States as an Amerasian
immigrant as described in
subsection (a)(2)(A)(i)(V)
until 5 years after the date of
such alien's entry into the
United States.
(L) Food stamp exception for refugees and
asylees.--With respect to eligibility for
benefits for the specified Federal program
described in paragraph (3)(B), paragraph (1)
shall not apply to an alien with respect to
which an action described in subparagraph (A)
was taken and was not revoked.
* * * * * * *
(H) Programs of student assistance under
titles IV, V, IX, and X of the Higher Education
Act of 1965, and titles III, VII, and VIII of
the Public Health Service Act.
(I) Means-tested programs under the
Elementary and Secondary Education Act of 1965.
(J) Benefits under the Head Start Act.
(K) Benefits under the Job Training
Partnership Act or title I of the Workforce
Investment Act of 1998.
(L) Assistance or benefits under the Food
Stamp Act of 1977 (7 U.S.C. 2011 et seq.).
Effective on July 1, 2000, this paragraph is amended by
striking ``Job Training Partnership Act or''.
(d) Benefits for Certain Groups.--Notwithstanding any other
provision of law, the limitations under section 401(a) and
subsection (a) shall not apply to--
* * * * * * *
SEC. 421. FEDERAL ATTRIBUTION OF SPONSOR'S INCOME AND RESOURCES TO
ALIEN.
(a) In General.--Notwithstanding any other provision of
law, in determining the eligibility and the amount of benefits
of an alien for any Federal means-tested public benefits
program (as provided under section 403), the income and
resources of the alien shall be deemed to include the
following:
(1) The income and resources of any person who
executed an affidavit of support pursuant to section
213A of the Immigration and Nationality Act (as added
by section 423 and as amended by section 551(a) of the
Illegal Immigration Reform and Immigrant Responsibility
Act of 1996) on behalf of such alien.
(2) The income and resources of the spouse (if any)
of the person.
(b) Duration of Attribution Period.--Subsection (a) shall
apply with respect to an alien until such time as the alien--
(1) achieves United States citizenship through
naturalization pursuant to chapter 2 of title III of
the Immigration and Nationality Act; or
(2)(A) has worked [40] 40 (or 16, in the case of the
specified Federal program described in section
402(a)(3)(B) of the Personal Responsibility and Work
Opportunity Reconciliation Act of 1996 (8 U.S.C.
1612(a)(3)(B))) qualifying quarters of coverage as
defined under title II of the Social Security Act or
can be credited with such qualifying quarters as
provided under section 435, and (B) in the case of any
such qualifying quarter creditable for any period
beginning after December 31, 1996, did not receive any
Federal means-tested public benefit (as provided under
section 403) during any such period.
(c) Review of Income and Resources of Alien Upon
Reapplication.--Whenever an alien is required to reapply for
benefits under any Federal means-tested public benefits
program, the applicable agency shall review the income and
resources attributed to the alien under subsection (a).
(d) Application.--
(1) If on the date of the enactment of this Act, a
Federal means-tested public benefits program attributes
a sponsor's income and resources to an alien in
determining the alien's eligibility and the amount of
benefits for an alien, this section shall apply to any
such determination beginning on the day after the date
of the enactment of this Act.
(2) If on the date of the enactment of this Act, a
Federal means-tested public benefits program does not
attribute a sponsor's income and resources to an alien
in determining the alien's eligibility and the amount
of benefits for an alien, this section shall apply to
any such determination beginning 180 days after the
date of the enactment of this Act.
(3) This section shall not apply to assistance or
benefits under the Food Stamp Act of 1977 (7 U.S.C.
2011 et seq.) to the extent that a qualified alien is
eligible under section 402(a)(2)(J).
(e) Indigence Exception.--
* * * * * * *
AGRICULTURE AND CONSUMER PROTECTION ACT OF 1973
* * * * * * *
COMMODITY DISTRIBUTION PROGRAM
Sec. 4. (a) Notwithstanding any other provision of law, the
Secretary may, during fiscal years 1991 through [2002] 2006
purchase and distribute sufficient agricultural commodities
with funds appropriated from the general fund of the Treasury
to maintain the traditional level of assistance for food
assistance programs as are authorized by law, including but not
limited to distribution to institutions (including hospitals
and facilities caring for needy infants and children),
supplemental feeding programs serving women, infants, and
children or elderly persons, or both, wherever located,
disaster areas, summer camps for children, the United States
Trust Territory of the Pacific Islands, and Indians, whenever a
tribal organization requests distribution of federally donated
foods pursuant to section 4(b) of the Food Stamp Act of 1977.
In providing for commodity distribution to Indians, the
Secretary shall improve the variety and quantity of commodities
supplied to Indians in order to provide them an opportunity to
obtain a more nutritious diet.
* * * * * * *
Sec. 5. [(a) In carrying out the supplemental feeding
program (hereinafter referred to as the ``commodity
supplemental food program'') under section 4 of this Act, the
Secretary (1) may institute two pilot projects directed at low-
income elderly persons, including, where feasible, distribution
of commodities to such persons in their homes; (2) shall
provide to the State agencies administering the commodity
supplemental food program, for each of the fiscal year 1991
through 2002 funds appropriated from the general fund of the
Treasury in amounts equal to the administrative costs of State
and local agencies in operating the program, except that the
funds provided to State agencies each fiscal year may not
exceed 20 percent of the amount appropriated for the commodity
supplemental food program.]
(a) Grants Per Assigned Caseload Slot.--
(1) In general.--In carrying out the program under
section 4 (referred to in this section as the
``commodity supplemental food program''), for each of
fiscal years 2003 through 2006, the Secretary shall
provide to each State agency from funds made available
to carry out that section (including any such funds
remaining available from the preceding fiscal year), a
grant per assigned caseload slot for administrative costs
incurred by the State agency and local agencies in the
State in operating the commodity supplemental food program.
(2) Amount of grants.--For each of fiscal years 2003
through 2006, the amount of each grant per caseload
slot shall be equal to $50, adjusted by the percentage
change between--
(A) the value of the State and local
government price index, as published by the
Bureau of Economic Analysis of the Department
of Commerce, for the 12-month period ending
June 30 of the second preceding fiscal year;
and
(B) the value of that index for the 12-month
period ending June 30 of the preceding fiscal
year.
(b) During the first three months of any commodity
supplemental food program, or until such program reaches its
projected caseload level, whichever comes first, the Secretary
shall pay those administrative costs necessary to commence the
program successfully: Provided, That in no event shall
administrative costs paid by the Secretary for any fiscal year
exceed the limitation established in subsection (a) of this
section.
(c) Administrative costs for the purposes of the commodity
supplemental food program shall include, but not be limited to,
expenses for information and referral, operation, monitoring,
nutrition education, start-up costs, and general
administration, including staff, warehouse and transportation
personnel, insurance, and administration of the State or local
office.
(d)(1) During each fiscal year the commodity supplemental
food program is in operation, the types and varieties of
commodities and their proportional amounts shall be determined
by the Secretary, but, if the Secretary proposes to make any
significant changes in the types, varieties, or proportional
amounts from those that were available or were planned at the
beginning of the fiscal year (or as were available during the
fiscal year ending June 30, 1976, whichever is greater) the
Secretary shall report such changes before implementation to
the Committee on Agriculture of the House of Representatives
and the Committee on Agriculture, Nutrition, and Forestry of
the Senate.
(2) Notwithstanding any other provision of law, the
Commodity Credit Corporation shall, to the extent that
the Commodity Credit Corporation inventory levels
permit, provide not less than 9,000,000 pounds of
cheese and not less than 4,000,000 pounds of nonfat dry
milk in each of the fiscal years 1991 through [2002]
2006 to the Secretary of Agriculture. The Secretary
shall use such amounts of cheese and nonfat dry milk to
carry out the commodity supplemental food program
before the end of each fiscal year.
(e) The Secretary of Agriculture is authorized to issue
such regulations as may be necessary to carry out the commodity
supplemental food program.
* * * * * * *
EMERGENCY FOOD ASSISTANCE ACT OF 1983
* * * * * * *
AUTHORIZATION AND APPROPRIATIONS
Sec. 204.(a) (1) There are authorized to be appropriated
$50,000,000 for each of the fiscal years 1991 through [2002]
2006, for the Secretary to make available to the States to pay
for the direct and indirect [administrative] costs of the
States related to the processing, storage, transporting, and
distributing to eligible recipient agencies of commodities
provided by the Secretary under this Act and commodities
secured from other sources. Funds appropriated under this
paragraph for any fiscal year shall be allocated to the States
on an advance basis, dividing such funds among the States in
the same proportions as the commodities distributed under this
Act for such fiscal year are divided among the States. If a
State agency is unable to use all of the funds so allocated to
it, the Secretary shall
* * * * * * *
CHILD NUTRITION ACT OF 1966
* * * * * * *
(iii)(I) receives medical assistance
under title XIX of the Social Security
Act; or
(II) is a member of a family in which
a pregnant woman or an infant receives
such assistance.
(B) For the purpose of determining income
eligibility under this section, any State
agency may choose to exclude from income--
(i) any [basic allowance for housing]
basic allowance--
(I) for housing received by
military service personnel
residing off military
installations; [and] or
(II) provided under section
403 of title 37, United States
Code, for housing that is
acquired or constructed under
subchapter IV of chapter 169 of
title 10, United States Code,
or any related provision of
law; and
(ii) any cost-of-living allowance
provided under section 405 of title 37,
United States Code, to a member of a
uniformed service who is on duty
outside the contiguous States of the
United States.
* * * * * * *
SEC. 456. SENIORS FARMERS MARKET NUTRITION PROGRAM.
(a) Establishment.--The Secretary of Agriculture shall
carry out and expand a seniors farmers' market nutrition
program.
(b) Program Purposes.--The purposes of the seniors farmers'
market nutrition program are--
(1) to provide to low-income seniors resources in the
form of fresh, nutrition, unprepared, locally grown
fruits, vegetables, and herbs from farmers' markets,
roadside stands, and community-supported agriculture
programs.
(2) to increase domestic consumption of agricultural
commodities by expanding or assistance in the expansion
of domestic farmers' markets, roadside stands, and
community-supported agriculture programs; and (3) to
develop or aid in the development of new farmers'
markets, roadside stands, and community-supported
agriculture programs.
(c) Regulations.--The Secretary may promulgate such
regulations as the Secretary considers necessary to carry out
the seniors farmers' market nutrition program under this
section.
(d) Termination of Effectiveness.--The program established
under subsection (a) terminates on September 30, 2006, and
shall be considered to have expired notwithstanding section 257
of the Balanced Budget and Emergency Deficit Control Act of
1985 (2 U.S.C. 907).
* * * * * * *
TITLE 5
CONSOLIDATED FARM AND RURAL DEVELOPMENT ACT
* * * * * * *
Subtitle A--Real Estate Loans
Sec. 302. (a) The Secretary is authorized to make and
insure loans under this subtitle to farmers and ranchers in the
United States, and to farm cooperatives and private domestic
corporations, partnerships, and [joint operations] joint
operations, and limited liability companies that are controlled
by farmers and ranchers and engaged primarily and directly in
farming or ranching in the United States, subject to the
conditions specified in this section. To be eligible for such
loans, applicants who are individuals, or, in the case of
cooperatives, corporations, partnerships, [and joint
operations] joint operations, and limited liability companies,
individuals holding a majority interest in such entity, must
(1) be citizens of the United States, (2) for direct loans
only, have either training or farming experience that the
Secretary determines is sufficient to assure reasonable
prospects of success in the proposed farming operations, (3) be
or will become owner-operators of not larger than family farms
(or in the case of cooperatives, corporations, partnerships,
[and joint operations] joint operations, and limited liability
companies in which a majority interest is held by individuals
who are related by blood or marriage, as defined by the
Secretary, such individuals must be or will become either
owners or operators of not larger than a family farm and at
least one such individual must be or will become an operator of
not larger than a family farm or, in the case of holders of the
entire interest who are related by blood or marriage and all of
whom are or will become farm operators, the ownership interest
of each such holder separately constitutes not larger than a
family farm, even if their interests collectively constitute
larger than a family farm, as defined by the Secretary), and
(4) be unable to obtain sufficient credit elsewhere to finance
their actual needs at reasonable rates and terms, taking into
consideration prevailing private and cooperative rates and
terms in the community in or near which the applicant resides
for loans for similar purposes and periods of time. In addition
to the foregoing requirements of this section, in the case of
corporations, partnerships, and joint operations, the family
farm requirement of clause (3) of the preceding sentence shall
apply as well to the farm or farms in which the entity has an
ownership and operator interest and the requirement of clause
(4) of the preceding sentence shall apply as well to the entity
in the case of cooperatives, corporations, partnerships, [and
joint operations] joint operations, and limited liability
companies.
(b) Direct Loans.--
(1) In general.--Subject to paragraph (3), the
Secretary may make a direct loan under this subtitle
only to a farmer or rancher who has [operated]
participated in the business operations of a farm or
ranch for not less than 3 years and--
(A) is a qualified beginning farmer or
rancher;
(B) has not received a previous direct farm
ownership loan made under this subtitle; or
* * * * * * *
SEC. 303. PURPOSES OF LOANS.
(a) Allowed Purposes.--
(1) Direct loans.--A farmer or rancher may use a
direct loan made under this subtitle only for--
(A) acquiring or enlarging a farm or ranch;
(B) making capital improvements to a farm or
ranch;
(C) paying loan closing costs related to
acquiring, enlarging, or improving a farm or
ranch; or
(D) paying for activities to promote soil and
water conservation and protection described in
section 304 on a farm or ranch.
(2) Guaranteed loans.--A farmer or rancher may use a
loan guaranteed under this subtitle only for--
(A) acquiring or enlarging a farm or ranch;
(B) making capital improvements to a farm or
ranch;
(C) paying loan closing costs related to
acquiring, enlarging, or improving a farm or
ranch;
(D) paying for activities to promote soil and
water conservation and protection described in
section 304 on a farm or ranch; or
(E) refinancing indebtedness.
(E) refinancing, during a fiscal year, a
short-term, temporary bridge loan made by a
commercial or cooperative lender to a beginning
farmer or rancher for the acquisition of land
for a farm or ranch, if--
(i) the Secretary approved an
application for a direct farm ownership
loan to the beginning farmer or rancher
for acquisition of the land; and
(ii) funds for direct farm ownership
loans under section 346(b) were not
available at the time at which the
application was approved.
(b) Preferences.--In making or guaranteeing a loan under
this subtitle for purchase of a farm or ranch, the Secretary
shall give preference to a person who--
* * * * * * *
SEC. 305. LIMITATIONS ON AMOUNT OF FARM OWNERSHIP LOANS.
[(a) In General.--The Secretary shall make or insure no
loan under sections 302, 303, 304, 310D, and 310E of this title
that would cause the unpaid indebtedness under such sections of
any one borrower to exceed the smaller of (1) the value of the
farm or other security, or (2) in the case of a loan other than
a loan guaranteed by the Secretary, $200,000, or, in the case
of a loan guaranteed by the Secretary, $700,000 (increased,
beginning with fiscal year 2000, by the inflation percentage
applicable to the fiscal year in which the loan is guaranteed
and reduced by the amount of any unpaid indebtedness of the
borrower on loans under subtitle B that are guaranteed by the
Secretary).]
(a) In General._The Secretary shall not make or insure a
loan under section 302, 303, 304, 310D, or 310E that would
cause the unpaid indebtedness under those sections of any 1
borrower to exceed the lesser of--
(1) the value of the farm or other security; or
(2)(A) in the case of a loan made by the Secretary--
(i) to a beginning farmer or rancher,
$250,000, as adjusted (beginning with fiscal
year 2003) by the inflation percentage
applicable to the fiscal year in which the loan
is made; or
(ii) to a borrower other than a beginning
farmer or rancher, $200,000; or
(B) in the case of a loan guaranteed by the
Secretary, $700,000, as--
(i) adjusted (beginning with fiscal year
2000) by the inflation percentage applicable to
the fiscal year in which the loan is
guaranteed; and
(ii) reduced by the amount of any unpaid
indebtedness of the borrower on loans under
subtitle B that are guaranteed by the
Secretary.
(b) Determination of Value.--In determining the value of
the farm, the Secretary shall consider appraisals made by
competent appraisers under rules established by the Secretary.
* * * * * * *
Sec. 307. (a)(1) The period for repayment of loans under
this subtitle shall not exceed forty years.
* * * * * * *
(C) Notwithstanding subparagraph (A), the Secretary
shall establish loan rates for health care and related
facilities based solely on the income of the area to be
served, and such rates shall be otherwise consistent
with such subparagraph.
(D) Joint financing arrangement.--[If]
(i) In general._Subject to clause (ii), if a
direct farm ownership loan is made under this
subtitle as part of a joint financing
arrangement and the amount of the direct farm
ownership loan does not exceed 50 percent of
the total principal amount financed under the
arrangement, the interest rate on the direct
farm ownership loan shall be at least 4 percent
annually.
(ii) Beginning farmers and ranchers.--The
interest rate charged a beginning farmer or
rancher for a loan described in clause (i)
shall be 50 basis points less than the rate
charged farmers and ranchers that are not
beginning farmers or ranchers.
* * * * * * *
Sec. 309. (a) The fund established pursuant to section
11(a) of the Bankhead-Jones Farm Tenant Act, as amended,shall
hereafter be called the Agricultural Credit Insurance Fund and is
hereinafter in this subtitle referred to as the ``fund''. The fund
shall remain available as a revolving fund for the discharge of the
obligations of the Secretary under agreements insuring loans under this
subtitle and loans and mortgages insured under prior authority.
* * * * * * *
(h)(1) The Secretary may provide financial assistance to
borrowers for purposes provided in this title by guaranteeing
loans made by any Federal or State chartered bank, savings and
loan association, cooperative lending agency, or other legally
organized lending agency.
(2) The interest rate payable by a borrower on the portion
of a guaranteed loan that is sold by a lender to the secondary
market under this title may be lower than the interest rate
charged on the portion retained by the lender, but shall not
exceed the average interest rate charged by the lender on loans
made to farm and ranch borrowers.
(3) With regard to any loan guarantee on a loan made by a
commercial or cooperative lender related to a loan made by the
Secretary under section 310E--
(A) the Secretary shall not charge a fee to any
person (including a lender); and
(B) a lender may charge a loan origination and
servicing fee in an amount not to exceed 1 percent of
the amount of the loan.
(4) Maximum guarantee of 90 percent.--Except as provided in
[paragraphs (5) and (6)] paragraphs (5), (6), and (7), a loan
guarantee under this title shall be for not more than 90
percent of the principal and interest due on the loan.
(5) Refinanced loans guaranteed at 95 percent.--The
Secretary shall guarantee 95 percent of--
(A) in the case of a loan that solely refinances a
direct loan made under this title, the principal and
interest due on the loan on the date of the
refinancing; or
(B) in the case of a loan that is used for multiple
purposes, the portion of the loan that refinances the
principal and interest due on a direct loan made under
this title that is outstanding on the date the loan is
guaranteed.
(6) Beginning farmer loans [guaranteed up to 95 percent.--
The Secretary may guarantee not more than] guaranteed at 95
percent.--The Secretary shall guarantee 95 percent of--
(7) Amount of guarantee of loans for tribal operations.--In
the case of an operating loan made to a farmer or rancher who
is a member of an Indian tribe and whose farm or ranch is
within an Indian reservation (as defined in section
335(e)(1)(A)(iii)), the Secretary shall guarantee 95 percent of
the loan.
(A) a farm ownership loan for acquiring a farm or
ranch to a borrower who is participating in the down
payment loan program under section 310E; or
(B) an operating loan to a borrower who is
participating in the down payment loan program under
section 310E that is made during the period that the
borrower has a direct loan outstanding under this
subtitle for acquiring a farm or ranch.
(i)(1) Not later than 60 days after any State expresses to
the Secretary, in writing, a desire to coordinate the provision
of financial assistance to qualified beginning farmers and
ranchers in the State, the Secretary and the State shall
conclude a joint memorandum of understanding that shall govern
the coordination of the provision of the financial assistance
by the State and the Secretary.
(2) The memorandum of understanding shall provide that if a
State beginning farmer program makes a commitment to provide a
qualified beginning farmer or rancher with financing to
establish or maintain a viable farming or ranching operation,
the Secretary shall, subject to applicable law, normal loan
approval criteria, and the availability of funds provide the
farmer or rancher with a down payment loan under section 310E
or a guarantee of the financing provided by the State program,
or both.
(3) The Secretary shall not charge any person (including a
lender) any fee with respect to the provision of any guarantee
under this subsection.
(4) The Secretary shall notify each State of the provisions
of this subsection.
(5) As used in paragraph (1), the term ``State beginning
farmer program'' means any program that is--
(A) carried out by, or under contract with, a State;
and
(B) designed to assist persons in obtaining the
financial assistance necessary to enter agriculture and
establish viable farming or ranching operations.
(j) Guarantee of Loans Made Under State Beginning Farmer or
Rancher Programs.--The Secretary may guarantee under this title
a loan made under a State beginning farmer or rancher program,
including a loan financed by the net proceeds of a qualified
small issue agricultural bond for land or property described in
section 144(a)(12)(B)(ii) of the Internal Revenue Code of 1986.
* * * * * * *
(7) Amount of guarantee of loans for tribal
operations.--In the case of an operating loan made to a
Native American farmer or rancher whose farm or ranch
is within an Indian reservation (as defined in section
335(e)(1)(A)(iii)), the Secretary shall guarantee 95
percent of the loan.
* * * * * * *
SEC. 310E. DOWN PAYMENT LOAN PROGRAM.
(a) In General.--
(1) Establishment.--Notwithstanding any other section
of this subtitle, the Secretary shall establish, within
the farm ownership loan program established under this
subtitle, a program under which loans shall be made
under this section to qualified beginning farmers and
ranchers for down payments on farm ownership loans.
(2) Administration.--The Secretary shall be the
primary coordinator of credit supervision for the down
payment loan program established under this section, in
consultation with the commercial or cooperative lender
and, if applicable, the contracting credit counseling
service selected under section 360(c).
(b) Loan Terms.--
(1) Principal.--Each loan made under this section
shall be in an amount equal to [30 percent] 40 percent
of the purchase price or appraisal value, whichever is
lower, of the farm or ranch to be acquired, unless the
borrower requests a lesser amount.
(2) Interest rate.--The interest rate on any loan
made by the Secretary under this section shall be 4
percent.
(3) Duration.--Each loan under this section shall be
made for a period of [10 years] 20-years or less, at
the option of the borrower.
(4) Repayment.--Each borrower of a loan under this
section shall repay the loan to the Secretary in equal
annual installments.
* * * * * * *
(c) Limitations.--
(1) Borrowers required to make minimum down
payment.--The Secretary shall not make a loan under
this section to any borrower with respect to a farm or
ranch if the contribution of the borrower to the down
payment on the farm or ranch will be less than 10
percent of the purchase price of the farm or ranch.
(2) Maximum price of property to be acquired.--The
Secretary shall not make a loan under this section with
respect to a farm or ranch for which the purchase price
or appraisal value, whichever is lower, exceeds
$250,000.
(3) Prohibited types of financing.--The Secretary
shall not make a loan under this section with respect
to a farm or ranch if the farm or ranch is to be
acquired with other financing that contains any of the
following conditions:
(A) The financing is to be amortized over a
period of less than 30 years.
(B) A balloon payment will be due on the
financing during the [10-year] 20-year period
beginning on the date the loan is to be made by
the Secretary.
* * * * * * *
SEC. 310F. BEGINNING FARMER AND RANCHER CONTRACT LAND SALES PROGRAM.
(a) In General.--Not later than October 1, 2002, the
Secretary shall carry out a pilot program in not fewer than 10
geographically dispersed States, as determined by the
Secretary, to guarantee up to 5 loans per State in each of
fiscal years 2003 through 2006 made by a private seller of a
farm or ranch to a qualified beginning farmer or rancher on a
contract land sale basis, if the loan meets applicable
underwriting criteria and a commercial lending institution
agrees to serve as escrow agent.
(b) Date of Commencement of Program.--The Secretary shall
commence the pilot program on making a determination that
guarantees of contract land sales present a risk that is
comparable with the riskpresented in the case of guarantees to
commercial lenders.
* * * * * * *
Subtitle B--Operating Loans
Sec. 311. (a) The Secretary is authorized to make and
insure loans under this subtitle to farmers and ranchers in the
United States, and to farm cooperatives and private domestic
corporations, partnerships, [and joint operations] joint
operations and limited liability companies that are controlled
by farmers and ranchers and engaged primarily and directly in
farming or ranching in the United States, subject to the
conditions specified in this section. To be eligible for such
loans, applicants who are individuals, or, in the case of
cooperatives, corporations, partnerships, [and joint
operations] joint operations, and limited liability companies,
individuals holding a majority interest in such entity, must
(1) be citizens of the United States, (2) for direct loans
only, have either training or farming experience that the
Secretary determines is sufficient to assure reasonable
prospects of success in the proposed farming operations, (3) be
or will become operators of not larger than family farms (or in
the case of cooperatives, corporations, partnerships, [and
joint operations] joint operations, and limited liability
companies in which a majority interest is held by individuals
who are related by blood or marriage, as defined by the
Secretary, such individuals must be or will become either
owners or operators of not larger than a family farm and at
least one such individual must be or will become an operator of
not larger than a family farm or, in the case of holders of the
entire interest who are related by blood or marriage and all of
whom are or will become farm operators, the ownership interest
of each such holder separately constitutes not larger than a
family farm, even if their interests collectively constitute
larger than a family farm, as defined by the Secretary), and
(4) be unable to obtain sufficient credit elsewhere to finance
their actual needs at reasonable rates and terms, taking into
consideration prevailing private and cooperative rates and
terms in the community in or near which the applicant resides
for loans for similar purposes and periods of time. In addition
to the foregoing requirements of this subsection, in the case
of corporations, partnerships, [and joint operations] joint
operations, and limited liability companies, the family farm
requirement of clause (3) of the preceding sentence shall apply
as well to the farm or farms in which the entity has an
operator interest and the requirement of clause (4) of the
preceding sentence shall apply as well to the entity in the
case of cooperatives, corporations, partnerships, [and joint
operations] joint operations, and limited liability companies.
(b)(1) Loans may also be made under this subtitle without
regard to the requirements of clauses (2) and (3) of subsection
(a) to youths who are rural residents to enable them to operate
enterprises in connection with their participation in 4-H
Clubs, Future Farmers of America, and similar organizations.
(2) A person receiving a loan under this subsection who
executes a promissory note therefor shall thereby incur full
personal liability for the indebtedness evidenced by such note
in accordance with its terms free of any disability of
minority.
* * * * * * *
(c) Direct Loans.--
(1) In general.--Subject to [paragraph (3)]
paragraphs (3) and (4), the Secretary may make a direct
loan under this subtitle only to a farmer or rancher
who--
(A) is a qualified beginning farmer or
rancher [who has not operated a farm or ranch,
or who has operated a farm or ranch for not
more than 5 years];
(B) has not received a previous direct
operating loan made under this subtitle; or
* * * * * * *
(4) Waivers. * * *--
(A) Tribal farm and ranch operations.--The
Secretary shall waive the limitation under
paragraph (1)(C) or (3) for a direct loan made
under this subtitle to a farmer or rancher who
is a member of an Indian Tribe and whose farm
or ranch is within an Indian reservation (as
defined in section 335(e)(1)(A)(ii)) if the
Secretary determines that commercial credit is
not generally available for such farm or ranch
operations.
(B) Other farm and ranch operations.--On a
case-by-case determination not subject to
administrative appeal, the Secretary may grant
a borrower a waiver, 1 time only for a period
of 2 years, of the limitation under paragraph
(1)(C) for a direct operating loan if the
borrower demonstrates to the satisfaction of
the Secretary that--
(i) the borrower has a viable farm or
ranch operation;
(ii) the borrower applied for
commercial credit from at least 2
commercial lenders;
(iii) the borrower was unable to
obtain a commercial loan (including a
loan guaranteed by the Secretary); and
(iv) the borrower successfully has
completed, or will complete within 1
year, borrower training under section
359 (from which requirement the Secretary
shall not grant a waiver under section
359(f)).
* * * * * * *
Subtitle C--Emergency Loans
Sec. 321. (a) The Secretary shall make and insure loans
under this subtitle only to the extent and in such amounts as
provided in advance in appropriation Acts to (1) established
farmers, ranchers, or persons engaged in aquaculture, who are
citizens of the United States and who are owner-operators (in
the case of loans for a purpose under subtitle A) or operators
(in the case of loans for a purpose under subtitle B) of not
larger than family farms, and (2) farm cooperatives, private
domestic corporations, partnerships, [or joint operations]
joint operations or limited liability companies, (A) that are
engaged primarily in farming, ranching, or aquaculture, and (B)
in which a majority interest is held by individuals who are
citizens of the United States and who are owner-operators (in
the case of loans for a purpose under subtitle A) or operators
(in the case of loans for a purpose under subtitle B) of not
larger than family farms (or in the case of such cooperatives,
corporations, partnerships, [or joint operations] in which a
majority interest is held by individuals who are related by
blood or marriage, as defined by the Secretary, such
individuals must be either owners or operators of not larger
than a family farm and at least one such individual must be an
operator of not larger than a family farm), where the Secretary
finds that the applicants' farming, ranching, or aquaculture
operations have been substantially affected by a natural
disaster in the United States or by a major disaster or
emergency designated by the President under the Disaster Relief
and Emergency Assistance Act: Provided, That they have
experience and resources necessary to assure a reasonable
prospect for successful operation with the assistance of such
loan and are not able to obtain sufficient credit elsewhere. In
addition to the foregoing requirements of this subsection, in
the case of farm cooperatives, private domestic corporations,
partnerships, [and joint operations], the family farm
requirement of the preceding sentence shall apply as well to
all farms in which the entity has an ownership and operator
interest (in the case of loans for a purpose under subtitle A)
or an operator interest (in the case of loans for a purpose
under subtitle B). The Secretary shall accept applications
from, and make or insure loans pursuant to the requirements of
this subtitle to, applicants, otherwise eligible under this
subtitle, that conduct farming, ranching, or aquaculture
operations in any county contiguous to a county where the
Secretary has found that farming, ranching, or aquaculture
operations have been substantially affected by a natural
disaster in the United States or by a major disaster or
emergency designated by the President under the Disaster Relief
and Emergency Assistance Act. The Secretary shall accept
applications for assistance under this subtitle from persons
affected by a natural disaster at any time during the eight-
month period beginning (A) on the date on which the Secretary
determines that farming, ranching, or aquaculture operations
have been substantially affected by such natural disaster or
(B) on the date the President makes the major disaster or
emergency designation with respect to such natural disaster, as
the case may be.
(b) Hazard Insurance Requirement.--
* * * * * * *
Subtitle D--Administrative Provisions
Sec. 331. (a) In accordance with section 359, for purposes
of this title, and for the administration of assets under the
jurisdiction of the Secretary of Agriculture pursuant to the
Farmers Home Administration Act of 1946, as amended, the
Bankhead-Jones Farm Tenant Act, as amended, the Act of August
28, 1937, as amended, the Act of April 6, 1949, as amended, the
Act of August 31, 1954, as amended, and the powers and duties
of the Secretary under any other Act authorizing agricultural
credit, the Secretary may assign and transfer such powers,
duties, and assets to such officers or agencies of the
Department of Agriculture as the Secretary considers
appropriate.
(b) The Secretary may--
* * * * * * *
(3) within the limits of appropriations made
therefor, make necessary expenditures for purchase or
hire of passenger vehicles, and such other facilities
and services as he may from time to time find necessary
for the proper administration of this title;
(4) compromise, adjust, reduce, or charge-off debts
or claims (including debts and claims arising from loan
guarantees), and adjust, modify, subordinate, or
release the terms of security instruments, leases,
contracts, and agreements entered into or administered
by the Consolidated Farm Service Agency, Rural
Utilities Service, Rural Housing Service, Rural
Business-Cooperative Service, or a successor agency, or
the Rural Development Administration, except for
activities under the Housing Act of 1949. In the case
of a security instrument entered into under the Rural
Electrification Act of 1936 (7 U.S.C. 901 et seq.), the
Secretary shall notify the Attorney General of the
intent of the Secretary to exercise the authority of
the Secretary under this paragraph. The Secretary may
not require liquidation of property securing any farmer
program loan or acceleration of any payment required
under any farmer program loan as a prerequisite to
initiating an action authorized under this subsection.
The Secretary may release borrowers or others obligated
on a debt, except for debt incurred under the Housing
Act of 1949, from personal liability with or without
payment of any consideration at the time of the
compromise, adjustment, reduction, or charge-off of any
claim, except that no compromise, adjustment,
reduction, or charge-off of any claim may be made
or [carried out--
[(A) with respect to farmer program loans, on
terms more favorable than those recommended by
the appropriate county committee utilized
pursuant to section 332; or]
[(B) after] carried out after the claim has
been referred to the Attorney General, unless
the Attorney General approves;
(5) except for activities conducted under the Housing
Act of 1949, collect all claims and obligations
administered by the Farmers Home Administration, or
under any mortgage, lease, contract, or agreement
entered into or administered by the Farmers Home
Administration and, if in his judgment necessary and
advisable, pursue the same to final collection in any
court having jurisdiction;
* * * * * * *
(c) The Secretary may use for the prosecution or defense of
any claim or obligation described in subsection (b)(5) the
Attorney General, the General Counsel of the Department of
Agriculture, or a private attorney who has entered into a
contract with the Secretary.
[(d) Temporary Authority To Enter Into Contracts.--]
(1) Definitions.--In this subsection:
(A) Eligible financial institution.--The term
``eligible financial institution'' means a
financial institution with substantial
experience in farm, ranch, or aquaculture
lending that is regulated by the Comptroller of
the Currency, the Farm Credit Administration,
or a similar regulatory body.
* * * * * * *
(5) Sunset provision.--This subsection shall be
effective until September 30, 2002.
[(e) Private Collection Agency.--The Secretary may use a
private collection agency to collect a claim or obligation
described in subsection (b)(5).]
* * * * * * *
Sec. 331B. Any loan for farm ownership purposes under
subtitle A of this title, farm operating purposes under
subtitle B of this title, or disaster emergency purposes under
subtitle C of this title, other than a guaranteed loan, that is
deferred, consolidated, rescheduled, or reamortized under this
title shall, notwithstanding any other provision of this title,
bear interest on the balance of the original loan and for the
term of the original loan at a rate that is the [lower of (1)
the] lowest of the rate of interest on the [original loan or
(2) the] original loan; the rate being charged by the Secretary
for loans, other than guaranteed loans, of the same type at the
time at which the borrower applies for a deferral,
consolidation, rescheduling, or reamortization; or the ???? of
the deferral, consolidation, rescheduling, or reamortization.
* * * * * * *
Sec. 333. In connection with loans made or insured under
this title, the Secretary shall require--
(1) the applicant (A) to certify in writing, and the
Secretary shall determine, that he is unable to obtain
sufficient credit elsewhere to finance his actual needs
at reasonable rates and terms, taking into
consideration prevailing private and cooperative rates
and terms in the community in or near which the
applicant resides for loans for similar purposes and
periods of time, and (B) to furnish an appropriate
written financial statement;
[(2) except with respect to a loan under section 306,
310B, or 314, the county or area committee established
under section 8(b)(5)(B) of the Soil Conservation and
Domestic Allotment Act (16 U.S.C. 590h(b)(5)(B)) to
certify in writing--
[(A) that an annual review of the credit
history and business operation of the borrower
has been conducted; and
[(B) that a review of the continued
eligibility of the borrower for the loan has
been conducted;]
(2) except with respect to a loan under section 306,
310B, or 314--
(A) an annual review of the credit history
and business operation of the borrower; and
(B) an annual review of the continued
eligibility of the borrower for the loan;
(3) except for guaranteed loans, an agreement by the
borrower that if at any time it shall appear to the
Secretary that the borrower may be able to obtain a
loan from a production credit association, a Federal
land bank, or other responsible cooperative or private
credit source (or, in the case of a borrower under
section 310D of this title, the borrower may be able to
obtain a loan under section 302 of this title), at
reasonable rates and terms for loans for similar
purposes and periods of time, the borrower will, upon
request by the Secretary, apply for and accept such
loan in sufficient amount to repay the Secretary or the
insured lender, or both, and to pay for any stock
necessary to be purchased in a cooperative lending agency
in connection with such loan;
* * * * * * *
(6) To the extent necessary for the borrower to
obtain a loan, guaranteed by the Secretary, from a
commercial or cooperative lender, the Secretary shall
provide interest rate reductions as provided for under
section 351.
(g)(1) The Secretary shall provide to lenders a short,
simplified application form for guarantees under this title [of
loans the principal amount of which is $50,000 or less] of
farmer program loans the principal amount of which is $100,000
or less.
(2) In Developing the Application, the Secretary Shall--
* * * * * * *
Sec. 335. (a) The Secretary is authorized and empowered to
make advances, without regard to any loan or total indebtedness
limitation, to preserve and protect the security for or the
lien or priority of the lien securing any loan or other
indebtedness owing to, insured by, or acquired by the Secretary
under this title or under any other programs administered by
the Farmers Home Administration or the Rural Development
Administration; to bid for and purchase at any execution,
foreclosure, or other sale or otherwise to acquire property
upon which the United States has a lien by reason of a judgment
or execution arising from, or which is pledged, mortgaged,
conveyed, attached, or levied upon to secure the payment of,
any such indebtedness whether or not such property is subject
to other liens, to accept title to any property so purchased or
acquired; and to sell, manage, or otherwise dispose of such
property as hereinafter provided.
* * * * * * *
(c) Sale of Property.--
(1) In general.--Subject to this subsection and
subsection (e)(1)(A), the Secretary shall offer to sell
real property that is acquired by the Secretary under
this title using the following order and method of
sale:
(A) Advertisement.--Not later than 15 days
after acquiring real property, the Secretary
shall publicly advertise the property for sale.
(B) Beginning farmer or rancher.--
(i) In general.--Not later than [75
days] 135 days after acquiring real
property, the Secretary shall offer to
sell the property to a qualified
beginning farmer or rancher at current
market value based on a current
appraisal.
(ii) Random selection.--If more than
1 qualified beginning farmer or rancher
offers to purchase the property, the
Secretary shall select between the
qualified applicants on a random basis.
(iii) Appeal of random selection.--A
random selection or denial by the
Secretary of a beginning farmer or
rancher for farm inventory property
under this subparagraph shall be final
and not administratively appealable.
(iv) Combining and dividing of
property.--To the maximum extent
practicable, the Secretary shall
maximize the opportunity for beginning
farmers and ranchers to purchase real
property acquired by the Secretary
under this title by combining or
dividing inventory parcels of the
property in such manner as the
Secretary determines to be appropriate.
(C) Public sale.--If no acceptable offer is
received from a qualified beginning farmer or
rancher under subparagraph (B) not later than
[75 days] 135 days after acquiring the real
property, the Secretary shall, not later than
30 days after the [75-day period] 135-day
period, sell the property after public notice
at a public sale, and, if no acceptable bid is
received, by negotiated sale, at the best price
obtainable.
(2) Previous lease.--In the case of real property
acquired before April 4, 1996, that the Secretary
leased before April 4, 1996, not later than 60 days
after the lease expires, the Secretary shall offer to
sell the property in accordance with paragraph (1).
(A) Previous lease.--In the case of real
property acquired prior to the date of
enactment of this subparagraph that the
Secretary leased prior to the date of enactment
of this subparagraph, not later than 60 days
after the lease expires, the Secretary shall
offer to sell the property in accordance with
paragraph (1).
(B) Previously in inventory.--In the case of
real property acquired prior to the date of
enactment of this subparagraph that the
Secretary has not leased, not later than 60
days after the date of enactment of this
subparagraph, the Secretary shall offer to sell
the property in accordance with paragraph (1).
(3) Interest.--
(A) In general.--Subject to [subparagraph
(B)] subparagraphs (B) and (C), any conveyance
of real property under this subsection shall
include all of the interest of the United
States in the property, including mineral
rights.
(B) Conservation.--The Secretary may for
conservation purposes grant or sell an
easement, restriction, development right, or
similar legal right to real property to a
State, a political subdivision of a State, or a
private nonprofit organization separately from
the underlying fee or other rights to the
property owned by the United States.
(C) Offer to sell or grant for farmland
preservation.--For the purpose of farmland
preservation, the Secretary shall--
(i) in consultation with the State
Conversationist of each State in which
inventory property is located, identify
each parcel of inventory property in
the State that should be preserved for
agricultural use; and
(ii) offer to sell or grant an
easement, restriction, development
right, or similar legal right to each
parcel identified under clause (i) to a
State, a political subdivision of a
State, or a private nonprofit
organization separately from the
underlying fee or other rights to the
property owned by the United States.
(4) Other law.--The Federal Property and
Administrative Services Act of 1949 (40 U.S.C. 471 et
seq.) shall not apply to any exercise of authority
under this title.
* * * * * * *
Sec. 343. (a) As used in this title:
(1) The term ``farmer'' includes a person who is
engaged in, or who, with assistance afforded under this
title, intends to engage in, fish farming.
* * * * * * *
(aa) materially and
substantially
participate in the
operation of the farm
or ranch; and
(bb) provide
substantial day-to-day
labor and management of
the farm or ranch,
consistent with the
practices in the State
or county in which the
farm or ranch is
located; or
(II) (aa) in the case of a
loan made to a cooperative,
corporation, partnership, or
joint operation, will have
members, stockholders,
partners, or joint operators,
materially and substantially
participate in the operation of
the farm or ranch; and
(bb) in the case of a loan
made to a corporation, has
stockholders, all of whom are
qualified beginning farmers or
ranchers;
(E) who agrees to participate in such loan
assessment, borrower training, and financial
management programs as the Secretary may
require;
(F) who does not own land or who, directly or
through interests in family farm corporations,
owns land, the aggregate acreage of which does
not exceed [25 percent] 30 percent of the
median acreage of the farms or ranches, as the
case may be, in the county in which the farm or
ranch operations of the applicant are located,
as reported in the most recent census of
agriculture taken under section 142 of title
13, United States Code, except that this
subparagraph shall not apply to a loan made or
guaranteed under subtitle B; and
(G) who demonstrates that the available
resources of the applicant and spouse (if any)
of the applicant are not sufficient to enable
the applicant to continue farming or ranching
on a viable scale.
(12) Debt forgiveness.--
(A) In general.--Except as provided in
subparagraph (B), the term ``debt forgiveness''
means reducing or terminating a farmer program
loan made or guaranteed under this title, in a
manner that results in a loss to the Secretary,
through--
(i) writing down or writing off a
loan under section 353;
(ii) compromising, adjusting,
reducing, or charging-off a debt or
claim under section 331;
(iii) paying a loss on a guaranteed
loan under section 357; or
(iv) discharging a debt as a result
of bankruptcy.
[(B) Loan restructuring.--The term ``debt
forgiveness'' does not include consolidation,
rescheduling, reamortization, or deferral.]
(B) Exceptions.--The term ``debt
forgiveness'' does not include--
(i) consolidation, rescheduling,
reamortization, or deferral of a loan;
or
(ii) any write-down provided as part
of a resolution of a discrimination
complaint against the Secretary.
* * * * * * *
Sec. 346. (a) Effective October 1, 1979, the aggregate
principal amount of loans under the programs authorized under
each subtitle of this title during each three-year period
thereafter shall not exceed such amounts as may be authorized
by law after the date of enactment of this section. There shall
be two amounts so established for each of such programs and for
any maximum levels provided in appropriation Acts for the
programs authorized under this title, one against which direct
and insured loans shall be charged and the other against which
guaranteed loans shall be charged.
(b) Authorization for Loans.--
[(1) In general.--The Secretary may make or guarantee
loans under subtitles A and B from the Agricultural
Credit Insurance Fund provided for in section 309 in
not more than the following amounts:]
(1) In general.--The Secretary may make or guarantee
loans under subtitles A and B from the Agricultural
Credit Insurance Fund provided for in section 309 for
not more than $3,750,000,000 for each of fiscal years
2002 through 2006, of which, for each fiscal year--
(A) $750,000,000 shall be for direct loans,
of which--
(i) $2000,000,000 shall be for farm
ownership loans under subtitle A; and
(ii) $550,000,000 shall be for
operating loans under subtitle B; and
(B) $3,000,000,000 shall be for guaranteed
loans, of which--
(i) $1,000,000,000 shall be for
guarantees of farm ownership loans
under subtitle A; and
(ii) $2,000,000,000 shall be for
guarantees of operating loans under
subtitle B.
(A) Fiscal year 1996.--For fiscal year 1996,
$3,085,000,000, of which--
(i) $585,000,000 shall be for direct
loans, of which--
(I) $85,000,000 shall be for
farm ownership loans under
subtitle A; and
* * * * * * *
(i) Farm ownership loans.--
(I) In general.--Of the
amounts made available under
paragraph (1) for direct farm
ownership loans, the Secretary
shall reserve 70 percent for
qualified beginning farmers and
ranchers.
(II) Down payment loans.--Of
the amounts reserved for a
fiscal year under subclause
(I), the Secretary shall
reserve 60 percent for the down
payment loan program under
section 310E until April 1 of
the fiscal year.
(ii) Operating loans.--Of the amounts
made available under paragraph (1) for
direct operating loans, the Secretary
shall reserve for qualified beginning
[farmers and ranchers--
[(I) for each of fiscal years
1996 through 1998, 25 percent;
[(II) for fiscal year 1999,
30 percent; and
[(III) for each of fiscal
years 2000 through 2002, 35
percent] farmers and ranchers
35 percent for each of fiscal
years 2002 through 2007.
(iii) Funds reserved until september
1.--Except as provided in clause
(i)(II), funds reserved for qualified
beginning farmers or ranchers under
this subparagraph for a fiscal year
shall be reserved only until September
1 of the fiscal year.
(B) Guaranteed loans.--
* * * * * * *
Sec. 350. Notwithstanding any other provision of this
title, the Secretary shall ensure that farm loan guarantee
programs carried out under this title are designed so as to be
responsive to borrower and lender needs and to include
provisions under reasonable terms and conditions for advances,
before completion of the liquidation process, of guarantee
proceeds on loans in default.
SEC. 351. INTEREST RATE REDUCTION PROGRAM.
(a) Establishment of [Program.--
(1) [In general.--The Secretary] Program._The
Secretary shall establish and carry out in accordance
with this section an interest rate reduction program
for loans guaranteed under this title.
[(2) Termination of authority.--The authority
provided by this subsection shall terminate on
September 30, 2002.]
(b) Under such program, the Secretary shall enter into a
contract with, and make payments to, a legally organized
institution to reduce during the term of such contract the
interest rate paid by a borrower on a guaranteed loan made by
such institution if--
(1) the borrower--
(A) is unable to obtain sufficient credit
elsewhere to finance the actual needs of the
borrower at reasonable rates and terms, taking
into consideration private and cooperative
rates and terms for a loan for a similar
purpose and period of time in the community in
or near which the borrower resides;
(B) is otherwise unable to make payments on
such loan in a timely manner; and
(C) has a total estimated cash income during
the 24-month period beginning on the date such
contract is entered into (including all farm
and nonfarm income) that will equal or exceed
the total estimated cash expenses to be
incurred by the borrower during such period
(including all farm and nonfarm expenses); and
(2) the lender reduces during the term of such
contract the annual rate of interest payable on such
loan by a minimum percentage specified in such
contract.
[(c) In return for a contract entered into by a lender
under subsection (b) for the reduction of the interest rate
paid on a loan, the Secretary shall make payments to the lender
in an amount equal to not more than 100 percent of the cost of
reducing the annual rate of interest payable on such loan,
except that such payments may not exceed the cost of reducing
such rate by more than 4 percent.]
(c) Amount of Interest Rate Reduction.--
(1) In general.--In return for a contract entered
into by a lender under subsection (b) for the reduction
of the interest rate paid on a loan, the Secretary
shall make payments to the lender in an amount equal to
not more than 100 percent of the cost of reducing the
annual rate of interest of interest payable on the
loan, except that such payments shall not exceed the
cost of reducing the rate by more than--
(A) in the case of a borrower other than a
beginning farmer or rancher, 3 percent; and
(B) in the case of a beginning farmer or
rancher, 4 percent.
(2) Beginning farmers and ranchers.--The percentage
reduction of the interest rate for which payments are
authorized to be made for a beginning farmer or rancher
under paragraph (1) shall be 1 percent more than the
percentage reduction for farmers and ranchers that are
not beginning farmers or ranchers.
(d) The term of a contract entered into under this section
to reduce the interest rate on a guaranteed loan may not exceed
the outstanding term of such loan.
(e)(1) Notwithstanding any other provision of this title,
the Agricultural Credit Insurance Fund established under
section 309 may be used by the Secretary to carry out this
section.
[(2) The total amount of funds used by the Secretary to
carry out this section may not exceed $490,000,000.]
(2) Maximum amount of funds.--
(A) In general.--The total amount of funds used by
the Secretary to carry out this section for a fiscal
year shall not exceed $750,000,000.
(B) Beginning farmers and ranchers.--
(i) In general.--The Secretary shall reserve
not less than 25 percent of the funds used by
the Secretary under subparagraph (A) to make
payments for guaranteed loans made to beginning
farmers and ranchers.
(ii) Duration of reservation of funds.--Funds
reserved for beginning farmers or ranchers
under clause (i) for a fiscal year shall be
reserved only until April 1 of the fiscal year.
(f) The Secretary shall make available to farmers, on
request, a list of lenders in the area that participate in
guaranteed farm loan programs and other lenders in the area
that express a desire to participate in such programs and that
request inclusion in the list.
(g) Notwithstanding any other provision of law, each
contract of guarantee on a farm loan entered into under this
title after the date of the enactment of this subsection shall
contain a condition that the lender of the guaranteed loan may
not initiate foreclosure action on the loan until 60 days after
a determination is made with respect to the eligibility of the
borrower thereof to participate in the program under this
section.
* * * * * * *
SEC. 353. DEBT RESTRUCTURING AND LOAN SERVICING.
(a) In General.--The Secretary shall modify delinquent
farmer program loans made or insured under this title, or
purchased from the lender or the Federal Deposit Insurance
Corporation under section 309B, to the maximum extent
possible--
* * * * * * *
(e) Shared Appreciation Arrangements.--
(1) In general.--As a condition of restructuring a
loan in accordance with this section, the borrower of
the loan may be required to enter into a shared
appreciation arrangement that requires the repayment of
amounts written off or set aside.
(2) Terms.--Shared appreciation agreements shall have
a term not to exceed 10 years, and shall provide for
recapture based on the difference between the appraised
values of the real security property at the time of
restructuring and at the time of recapture.
(3) Percentage of recapture.--The amount of the
appreciation to be recaptured by the Secretary shall be
75 percent of the appreciation in the value of such
real security property if the recapture occurs within 4
years of the restructuring, and 50 percent if the
recapture occurs during the remainder of the term of
the agreement.
(4) Time of recapture.--Recapture shall take place at
the end of the term of the agreement, or sooner--
(A) on the conveyance of the real security
property;
(B) on the repayment of the loans; or
(C) if the borrower ceases farming
operations.
(5) Transfer of title.--Transfer of title to the
spouse of a borrower on the death of such borrower
shall not be treated as a conveyance for the purpose of
paragraph (4).
(6) Notice of recapture.--Beginning with fiscal year
2000 not later than 12 months before the end of the
term of a shared appreciation arrangement, the
Secretary shall notify the borrower involved of the
provisions of the arrangement.
[(7) Financing of recapture payment.--]
(7) Options for satisfaction of obligation to pay
recapture amount.--
[(A) In general.--The Secretary may amortize
a recapture payment owed to the Secretary under
this subsection.
[(B) Term.--The term of an amortization under
this paragraph may not exceed 25 years.
[(C) Interest rate.]
(i) In general.--The Secretary may
amortize a recapture payment owed to
the Secretary under this subsection.
(ii) Term.--The term of an
amortization under this paragraph may
not exceed 25 years.
(iii) Interest rate.--
(A) In general.--As an alternative to
repaying the full recapture amount at the end
of the term of the shared appreciation
agreement (as determined by the Secretary in
accordance with this subsection), a borrower
may satisfy the obligation to pay the amount of
recapture by--
(i) financing the recapture payment
in accordance with subparagraph (B); or
(ii) granting the Secretary an
agricultural use protection and
conservation easement on the property
subject to the shared appreciation
agreement in accordance with
subparagraph (C).
(B) Financing of recapture payment.--''; and
(4) by adding at the end the following:
(C) Agricultural use protection and
conservation easement.--
(i) In general.--Subject to clause
(iii), the Secretary shall accept an
agricultural use protection and
conservation easement from the borrower
for all of the real security property
subject to the shared appreciation
agreement in lieu of payment of the
recapture amount.
(ii) Term.--The term of an easement
accepted by the Secretary under this
subparagraph shall be 25 years.
(iii) Conditions.--The easement shall
require that the property subject to the
easement shall continue to be used or
conserved for agricultural and conservation
uses in accordance with sound farming and
conservation practices, as determined by
the Secretary.
(iv) Replacement of method of
satisfying obligation.--A borrower that
has begun financing of a recapture
payment under subparagraph (B) may
replace that financing with an
agricultural use protection and
conservation easement under this
subparagraph.
[(i)] (I) In general.--The
interest rate applicable to an
amortization under this
paragraph may not exceed the
rate applicable to a loan to
reacquire homestead property
less 100 basis points.
[(ii)] (II) Existing
amortizations and loans.--The
interest rate applicable to an
amortization or loan made by
the Secretary before the date
of enactment of this paragraph
to finance a recapture payment
owed to the Secretary under
this subsection may not exceed
the rate applicable to a loan
to reacquire homestead property
less 100 basis points.
(f) Determination To Restructure.--If the appeal process
results in a determination that a loan is eligible for
restructuring, the Secretary shall restructure the loan in the
manner consistent with this section, taking into consideration
the restructuring recommendations, if any, of the appeals
officer.
* * * * * * *
SEC. 359. BORROWER TRAINING.
(a) In General.--The Secretary shall enter into contracts
to provide educational training to all borrowers of farmer
program direct loans made under this title in financial and
farm management concepts associated with commercial farming.
* * * * * * *
(e) Payment.--A borrower shall pay for training received
under this section, and may use funds from operating loans made
under subtitle B to pay for the training.
[(f) Waivers.--The Secretary may waive the requirements of
this section for an individual borrower on a determination by
the county committee that the borrower demonstrates adequate
knowledge in areas described in this section.]
(f) Waivers.--
(1) In general.--The Secretary may waive the
requirements of this section for an individual borrower
if the Secretary determines that the borrower
demonstrates adequate knowledge in areas described in
this section.
(2) Criteria.--The Secretary shall establish criteria
providing for the application of paragraph (1)
consistently in all counties nationwide.
* * * * * * *
FARM CREDIT ACT OF 1971
* * * * * * *
SEC. 1.12. RELATED SERVICES.
(a) In General.--The Farm Credit Banks may provide
technical assistance to borrowers, members, and applicants from
the bank and associations in the district, including persons
obligated on paper discounted by the bank, and may make
available to them at their option such financial related
services appropriate to their on-farm and aquatic operations as
determined to be feasible by the board of directors of the
bank, under regulations of the Farm Credit Administration.
(b) Authority To Pass Along Cost of Insurance Premiums.--
Each Farm Credit Bank may assess each production credit
association, other association making direct loans under the
authority provided under section 7.6, and other financing
institution described in section 1.7(b)(1)(B) in the district
in which the bank is located to cover the costs of making
premium payments under part E of title V. The assessment of any
such association or other financing institution for any
calendar year shall be computed on the same basis as is used to
compute the premium payment and shall not exceed the sum of--
(1) the annual average principal outstanding for such
year on loans made by the association, or on loans made
by the other financing institution and funded by or
discounted with the Farm Credit Bank, that are in
accrual status, excluding the guaranteed portions of
government-guaranteed loans (as defined in section
5.55(a)(3)) provided for in paragraph (3) and
Government Sponsored Enterprised-guaranteed loans (as
defined in section 5.55(a)(4)) provided for in
paragraph (4), multiplied by 0.0015;
(2) the annual average principal outstanding for such
year on loans made by the association, or on loans made
by the other financing institution and funded by or
discounted with the Farm Credit Bank, that are in
nonaccrual status, multiplied by 0.0025; [and]
(3)(A) the annual average principal outstanding for
such year on the guaranteed portions of Federal
government-guaranteed loans (as so defined) made by the
association, or by the other financing institution and
funded by or discounted with the Farm Credit Bank, that
are in accrual status, multiplied by 0.00015;
(B) the annual average principal outstanding for such
year on the guaranteed portions of State government-
guaranteed loans (as so defined) made by the
association, or by the other financing institution
and funded by or discounted with the Farm Credit Bank,
that are in accrual status, multiplied by 0.0003. ; and;
(4) the annual average principal outstanding for such
year on the guaranteed portions of Government Sponsored
Enterprise-guaranteed loans (as so defined) made by the
association, or by the other financing institution and
funded by or discounted with the Farm Credit Bank, that
are in accrual status, multiplied by the factor, not to
exceed 0.0015, determined by the Corporation for the
purpose of setting the premium for such guaranteed
portions of loans under section 5.55(a)(1)(D).
* * * * * * *
Sec. 3.1. Corporate Existence; General Corporate Powers.--
Each bank for cooperatives shall be a body corporate and,
subject to regulation by the Farm Credit Administration, shall
have power to--
* * * * * * *
(11)(A) Participate in loans under this title with
one or more other banks for cooperatives and with
commercial banks and other financial institutions upon
such terms as may be agreed among them, and participate
with one or more other Farm Credit System institutions
in loans made under this title or other titles of this
Act on the basis prescribed in section 4.18 of this
Act.
(B)(i) Participate in any loan of a type otherwise
authorized under this title that is made to a similar
entity by any institution in the business of extending
credit, including purchases of participations in loans
to finance international trade transactions involving
the sale of agricultural commodities or the products
thereof, except that--
(I) a bank for cooperatives may not
participate in a loan--
(aa) if the participation would cause
the total amount of all loan
participations by the bank under this
subparagraph involving a single credit
risk to exceed 10 percent of the bank's
total capital; or
(bb) if the participation by the bank
will itself equal or exceed 50 percent
of the principal of the loan or, when
taken together with participations in
the loan by other Farm Credit System
institutions, will cause the cumulative
amount of the participations by all
Farm Credit System institutions in the
loan to equal or exceed 50 percent of
the principal of the loan;
(II) a bank for cooperatives may not
participate in a loan to a similar entity under
this subparagraph if the similar entity has a
loan or loan commitment outstanding with a Farm
Credit Bank or an association chartered under
this Act, unless agreed to by the Bank or
association; and
(III) the cumulative amount of participations
that a bank for cooperatives may have
outstanding under this subparagraph at any time
may not exceed 15 percent of the bank's total
assets.
(ii) As used in this subparagraph, the term
``similar entity'' means an entity that, while
not eligible for a loan under section 3.8, is
functionally similar to an entity eligible for
a loan under section 3.8 in that it derives a
majority of its income from, or has a majority
of its assets invested in, the conduct of
activities functionally similar to those
conducted by the entity.
[(iii) With respect to similar entities that are
eligible to borrow from a Farm Credit Bank or
association under title I or II, the authority of a
bank for cooperatives to participate in loans to the
entities under this subparagraph shall be subject to
the prior approval of the Farm Credit Bank or Banks in
whose chartered territory the entity is eligible to
borrow. The approval may be granted on an annual basis
and under such terms and conditions as may be agreed on
between the bank for cooperatives and the Farm Credit
Bank or Banks that serve the territory.
[(iv)] (iii) As used in this subparagraph, the term
``participate'' or ``participation'' refers to
multilender transactions, including syndications,
assignments, loan participations, subparticipations, or
other forms of the purchase, sale, or transfer of
interests in loans, other extensions of credit, or
other technical and financial assistance.
* * * * * * *
Sec. 3.7. Lending Power.--(a) The banks for cooperatives
are authorized to make loans and commitments to eligible
cooperative associations and to extend to them other technical
and financial assistance at any time (whether or not they have
a loan from the bank outstanding), including but not limited to
discounting notes and other obligations, guarantees, currency
exchange necessary to service individual transactions that may
be financed under subsection (b) of this section, collateral
custody, or participation with other banks for cooperatives and
commercial banks or other financial institutions in loans to
eligible cooperatives, under such terms and conditions as may
be determined to be feasible by the board of directors of each
bank for cooperatives under regulations of the Farm Credit
Administration. Such regulations may include provisions for
avoiding duplication between the Central Bank and district
banks for cooperatives. Each bank may own and lease, or lease
with option to purchase, to stockholders eligible to borrow
from the bank equipment needed in the operations of the
stockholder and may make or participate in loans or commitments
and extend other technical and financial assistance to other
domestic parties for the acquisition of equipment and
facilities to be leased to such stockholders for use in their
operations in the United States.
(b)(1) A bank for cooperatives is authorized to make or
participate in loans and commitments to, and to extend other
technical and financial assistance to a domestic or foreign
party with respect to its transactions with an association that
is a voting stockholder of the bank for the import of
agricultural commodities or products thereof, [farm supplies]
agricultural supplies, or aquatic products through purchases,
sales or exchanges, if the bank for cooperatives determines,
under regulations of the Farm Credit Administration, that the
voting stockholder will benefit substantially as a result of
such loan, commitment, or assistance.
(2)(A) A bank for cooperatives may make or participate in
loans and commitments to, and extend other technical and
financial assistance to--
(i) any domestic or foreign party for the export,
including (where applicable) the cost of freight, of
agricultural commodities or products thereof, [farm
supplies] agricultural supplies, or aquatic products
from the United States under policies and procedures
established by the bank to ensure that the commodities,
products, or supplies are originally sourced, where
reasonably available, from one or more eligible
cooperative associations described in section 3.8(a) on
a priority basis, except that if the total amount of
the balances outstanding on loans made by a bank under
this clause that--
(I) are made to finance the export of
commodities, products, or supplies that are not
originally sourced from a cooperative, and
* * * * * * *
(f) The banks for cooperatives may, for the purpose of
installing, maintaining, expanding, improving, or operating
water and waste disposal facilities in rural areas, make and
participate in loans and commitments and extending other
technical and financial assistance to--
(1) cooperatives formed specifically for the purpose
of establishing or operating such facilities; and
(2) public and quasi-public agencies and bodies, and
other public and private entities that, under authority
of State or local law, establish or operate such
facilities.
For purposes of this subsection, the term ``rural area'' means
all territory of a State that is not within the outer boundary
of any city or town having a population of more than 20,000
based on the latest decennial census of the United States.
(4) Definition of agricultural supply.--In this
subsection, the term `agricultural supply' includes--
(A) a farm supply; and
(B)(i) agriculture-related processing
equipment;
(ii) agriculture-related machinery; and
(iii) other capital goods related to the
storage or handling of agricultural commodities
or products.
* * * * * * *
SEC. 4.18A. AUTHORITY OF FARM CREDIT BANKS AND DIRECT LENDER
ASSOCIATIONS TO PARTICIPATE IN LOANS TO SIMILAR
ENTITIES FOR RISK MANAGEMENT PURPOSES.
(a) Definitions.--As used in this section:
(1) Participate and participation.--The terms
``participate'' and ``participation'' shall have the
meaning provided in section [3.11(11)(B)(iv)]
3.11(11)(B)(iii).
(2) Similar entity.--The term ``similar entity''
means a person that--
* * * * * * *
(3) the participation would cause the cumulative
amount of participations that the Farm Credit Bank or
association has outstanding under this section to
exceed 15 percent of the total assets of the Farm
Credit Bank or association; or
(4) the loan is of the type authorized under section
1.11(b) or 2.4(a)(2).
[(c) Prior Approval Required.--]
* * * * * * *
SEC. 5.55. PREMIUMS.
(a) Amount in Fund Not Exceeding Secure Base Amount.--
(1) In general.--If at the end of any calendar year
the aggregate of amounts in the Farm Credit Insurance
Fund does not exceed the secure base amount, subject to
paragraph (2), the annual premium due from any insured
System bank for the calendar year shall be equal to the
sum of--
(A) the annual average principal outstanding
for such year on loans made by the bank that
are in accrual status, excluding the guaranteed
portions of [government-guaranteed loans
provided for in subparagraph (C)] loans
provided for in subparagraphs (C) and (D),
multiplied by 0.0015;
(B) the annual average principal outstanding
for such year on loans made by the bank that
are in nonaccrual status, multiplied by 0.0025;
[and]
(C)(i) the annual average principal
outstanding for such year on the guaranteed
portions of Federal Government-guaranteed loans
made by the bank that are in accrual status,
multiplied by 0.00015; and
(ii) the annual average principal outstanding
for such year on the guaranteed portions of
State government-guaranteed loans made by the
bank that are in accrual status, multiplied by
0.0003. ; and
(D) the annual average principal outstanding
for such year on the guaranteed portions of
Government Sponsored Enterprise-guaranteed
loans made by the bank that are in accrual
status, multiplied by a factor, not to exceed
0.0015, determined by the Corporation at the
sole discretion of the Corporation.
(2) Reduced premiums.--The Corporation, in the sole
discretion of the Corporation, may reduce by a
percentage uniformly applied to all insured System
banks the annual premium due from each insured System
bank during any calendar year, as determined under
paragraph (1).
* * * * * * *
(3) Annual allocations.--If, at the end of any
calendar year, the aggregate of the amounts in the Farm
Credit Insurance Fund exceeds the average secure base
amount for the calendar year (as calculated on an average
daily balance basis), the Corporation shall allocate to the
Allocated Insurance Reserves Accounts the excess amount
less the amount that the Corporation, in its sole discretion,
determines to be the sum of the estimated operating expenses
and estimated insurance obligations of the Corporation for
the immediately succeeding calendar year.
(4) Allocation formula.--From the total amount
required to be allocated at the end of a calendar year
under paragraph (3)--
(A) 10 percent of the total amount shall be
credited to the Allocated Insurance Reserves
Account established under paragraph (1)(B),
subject to paragraph (6)(C); and
(B) there shall be credited to the Allocated
Insurance Reserves Account of each insured
System bank an amount that bears the same ratio
to the total amount (less any amount credited
under subparagraph (A)) as the average
principal outstanding for the 3-year period
ending on the end of the calendar year on loans
made by the bank that are in accrual status
bears to the average principal outstanding for
the 3-year period ending on the end of the
calendar year on loans made by all insured
System banks that are in accrual status
(excluding, in each case, the guaranteed
portions of [government-guaranteed loans
described in subsection (a)(1)(C))] loans
described in subparagraph (C) or (D) of
subsection (a)(1).
(5) Use of funds in allocated insurance reserves
accounts.--To the extent that the sum of the operating
expenses of the Corporation and the insurance
obligations of the Corporation for a calendar year
exceeds the sum of operating expenses and insurance
obligations determined under paragraph (3) for the
calendar year, the Corporation shall cover the expenses
and obligations by--
* * * * * * *
(i) the total of the amounts that
would have been paid if payments under
subparagraph (A) had been authorized to
begin, under the same terms and
conditions, in the first calendar year
beginning more than 5 years after the
date on which the aggregate of the
amounts in the Farm Credit Insurance
Fund exceeds the secure base amount,
and to continue through the 2
immediately subsequent years;
(ii) interest earned on any amounts
that would have been paid as described
in clause (i) from the date on which
the payments would have been paid as
described in clause (i); and
(iii) the payment to be made in the
initial year described in subparagraph
(A), based on the amount in each
Account after subtracting the amounts
to be paid under clauses (i) and (ii).
(4) Definition of government sponsored enterprise-
guaranteed loan.--In this section and sections 1.12(b)
and 5.56(a), the term ``Government Sponsored
Enterprise-guaranteed loan'' means a loan or credit, or
portion of a loan or credit, that is guaranteed by an
entity that is chartered by Congress to serve a public
purpose and the debt obligations of which are not
explicitly guaranteed by the United States, including
the Federal National Mortgage Association, the Federal
Home Loan Mortgages Corporation, the Federal Home Loan
Bank System, and the Federal Agricultural Mortgage
Corporation, but not including any other institution of
the Farm Credit System.
* * * * * * *
SEC. 5.56. CERTIFICATION OF PREMIUMS.
(a) Filing Certified Statement.--Annually, on a date to be
determined in the sole discretion of the Board of Directors,
each insured System bank that became insured before the
beginning of the year shall file with the Corporation a
certified statement showing--
(1) the annual average principal outstanding on loans
made by the bank that are in accrual status, including
the nonguaranteed portions of government-guaranteed
loans and Government Sponsored Enterprise-guaranteed
loans;
(2) the annual average principal outstanding on the
guaranteed portion of Federal Government-guaranteed
loans (as defined in section 5.55(a)(3)) that are in
accrual status;
(3) the annual average principal outstanding on State
government-guaranteed loans (as defined in section
5.55(a)(3)) that are in accrual status;
(4) the annual average principal outstanding on the
guaranteed portions of Government Sponsored Enterprise-
guaranteed loans (as defined in section 5.55(a)(4))
that are in accrual status;
(5) the annual average principal outstanding on loans
that are in nonaccrual status; and
(6) the amount of the premium due the Corporation
from the bank for the year.
(b) Contents and Form of Statement.--The certified
statement required to be filed with the Corporation under
subsection (a) shall be in such form and set forth such
supporting information as the Board of Directors shall
prescribe, and shall be certified by the president of the bank
or any other officer designated by its board of directors that
to the best of the person's knowledge and belief the statement
is true, correct, complete, and has been prepared in accordance
with this part and all regulations issued thereunder.
(c) Initial Premium Payment.--Each System bank shall pay to
the Corporation the amount of the initial premium it is
required to certify under subsection (a) as soon as practicable
after January 1, 1990, based on the application of section 5.55
to the accruing loan volume of the bank for calendar year 1989.
(d) Subsequent Premium Payments.--The premium payments
required from insured System banks under subsection (a) shall
be made not less frequently than annually in such manner and at
such time or times as the Board of Directors shall prescribe,
except that the amount of the premium shall be established not
later than 60 days after filing the certified statement setting
forth the amount of the premium.
(e) Regulations.--The Board of Directors shall prescribe
all rules and regulations necessary for theenforcement of this
section. The Board of Directors may limit the retroactive effect, if
any, of any of its rules or regulations.
* * * * * * *
SEC. 8.2. BOARD OF DIRECTORS.
(a) Interim Board.--
* * * * * * *
(b) Permanent Board.--
(1) Establishment.--Immediately after the date that
banks, other financial institutions or entities,
insurance companies, and System institutions have
subscribed and fully paid for at least $20,000,000 of
common stock of the Corporation, the Corporation shall
arrange for the election and appointment of a permanent
board of directors. After the termination of the
interim board, the Corporation shall be under the
management of the permanent board.
(2) Composition.--The permanent board shall consist
of [15] 17 members, of which--
(A) 5 members shall be elected by holders of
[common stock that are insurance companies,
banks, or other financial institutions or
entities] Class B voting common stock;
(B) 5 members shall be elected by holders of
common stock that are Farm Credit System
institutions; and
(C) 2 members shall be elected by holders of
Class A voting common stock and Class B voting
common stock, 1 of whom shall be the chief
executive officer of the Corporation and 1 of
whom shall be another executive officer of the
Corporation; and
(D) 5 members shall be appointed by the
President, by and with the advice and consent
of the Senate--
(i) which members shall not be, or
have been, officers or directors of any
financial institutions or entities;
(ii) which members shall be
representatives of the general public;
(iii) of which members not more than
3 shall be members of the same
political party; and
(iv) of which members at least 2
shall be experienced in farming or
ranching.
(3) Presidential appointees.--The President shall
appoint the members of the permanent board referred to
in paragraph [(2)(C)] (2)(D) not later than the later
of--
(A) the date referred to in paragraph (1); or
(B) the expiration of the 270-day period
beginning on the date of the enactment of this
title.
(4) Vacancy.--
(A) Elected members.--Subject to paragraph
(6), a vacancy among the members elected to the
permanent board in the manner described in
subparagraph [(A) or (B)] (A), (B), or (C) of
paragraph (2) shall be filled by the permanent
board from among persons eligible for election
to the position for which the vacancy exists.
(B) Appointed members.--A vacancy among the
members appointed to the permanent board under
paragraph [(2)(C)] (2)(D) shall be filled in
the manner in which the original appointment
was made.
(5) Continuation of membership.--If--
(A) any member of the permanent board who was
appointed or elected to the permanent board
from among persons who are executive officers
of the Corporations or representatives of
banks, other financial institutions or
entities, insurance companies, or Farm Credit
System institutions ceases to be [such a
representative;] such an executive officer or
representative; or
(B) any member who was appointed from persons
who are not or have not been directors or
officers of any financial institution or entity
becomes a director or an officer of any
financial institution or entity; such member
may continue as a member for not longer than
the 45-day period beginning on the date such
member ceases to be such a representative,
officer, or employee or becomes such a director
or officer, as the case may be.
(6) Terms.--
(A) Appointed members.--The members appointed
by the President shall serve at the pleasure of
the President.
(B) Elected members.--The members elected
under subparagraphs [(A) and (B)] (A), (B), and
(C) of subsection (b)(2) shall each be elected
annually for a term ending on the date of the
next annual meeting of the common stockholders
of the Corporation and shall serve until their
successors are elected and qualified. Any seat
on the permanent board that becomes vacant
after the annual election of the directors
shall be filled by the members of the permanent
board from the same category of directors, but
only for the unexpired portion of the term.
(C) Vacancy appointment.--Any member
appointed to fill a vacancy occurring before
the expiration of the term for which the
predecessor of the member was appointed shall
be appointed only for the remainder of such
term.
(D) Service after expiration of term.--A
member may serve after the expiration of the
term of the member until the successor of the
member has taken office.
(7) Quorum.--[8 members] Nine members of the
permanent board shall constitute a quorum.
(8) No additional pay for federal officers or
employees or executive officers of the corporation.--
Members of the permanent board who are fulltime
officers or employees of the United States or executive
officers of the Corporation shall receive no additional
pay by reason of service on the permanent board.
[(9) Chairperson.--The President shall designate 1 of
the members of the permanent board who are appointed by
the President as the chairperson of the permanent
board.]
(9) Chairperson.--
(A) Election.--The permanent board shall
annually elect a chairperson from among the
members of the permanent board.
(B) Term.--The term of the chairperson shall
coincide with the term served by elected
members of the permanent board under paragraph
(6)(B).
(10) Meetings.--The permanent board shall meet at the
call of the chairperson or a majority of its members.
(c) Officers and Staff.--The Board may appoint, employ, fix
the pay of, and provide other allowances and benefits for such
officers and employees of the Corporation as the Board
determines to be appropriate.
* * * * * * *
DEPARTMENT OF AGRICULTURE REORGANIZATION
* * * * * * *
SEC. 281. CONFORMING AMENDMENTS RELATING TO NATIONAL APPEALS DIVISION.
(a) Decisions of State, County, and Area Committees.--
(1) Application of subsection.--[This subsection]
(A) In general.--Except as provided in
subparagraph (B), this subsection shall apply
only with respect to functions of the
Consolidated Farm Service Agency or the
Commodity Credit Corporation that are under the
jurisdiction of a State, county, or area
committee established under section 8(b)(5) of
the Soil Conservation and Domestic Allotment
Act (16 U.S.C. 590h(b)(5)) or an employee of
such a committee.
(B) Agricultural credit decisions.--This
subsection shall not apply with respect to an
agricultural credit decision made by such a
State, county, or area committee, or employee
of such a committee, under the Consolidated
Farm and Rural Development Act (7 U.S.C 1921 et
seq.).
(2) Finality.--Each decision of a State, county, or
area committee (or an employee of such a committee)
covered by paragraph (1) that is made in good faith in
the absence of misrepresentation, false statement,
fraud, or willful misconduct shall be final not later
than 90 days after the date of filing of the
application for benefits, unless the decision is--
TITLE 6
* * * * * * *
CONSOLIDATED FARM AND RURAL DEVELOPMENT ACT
* * * * * * *
Sec. 306. (a)(1) The Secretary is also authorized to make
or insure loans to associations, including corporations not
operated for profit, Indian tribes on Federal and State
reservations and other federally recognized Indian tribes, and
public and quasi-public agencies to provide for the application
or establishment of soil conservation practices, shifts in land
use, the conservation, development, use, and control of water,
and the installation or improvement of drainage or waste
disposal facilities, recreational developments, and essential
community facilities including necessary related equipment, all
primarily serving farmers, ranchers, farm tenants, farm
laborers, rural businesses, and other rural residents, and to
furnish financial assistance or other aid in planning projects
for such purposes. The Secretary may also make loans to any
borrower to whom a loan has been made under the Rural
Electrification Act of 1936 (7 U.S.C. 901 et seq.), for the
conservation, development, use, and control of water, and the
installation of drainage or waste disposal facilities,
primarily serving farmers, ranchers, farm tenants, farm
laborers, rural businesses, and other rural residents. When any
loan made for a purpose specified in this paragraph is sold out
of the Agricultural Credit Insurance Fund as an insured loan,
the interest or other income thereon paid to an insured holder
shall be included in gross income for purposes of chapter 1 of
the Internal Revenue Code of 1954. With respect to loans of
less than $500,000 made or insured under this paragraph that
are evidenced by notes and mortgages, as distinguished from
bond issues, borrowers shall not be required to appoint bond
counsel to review the legal validity of the loan whenever the
Secretary has available legal counsel to perform such review.
[(2) The] (2) Water, waste disposal, and wastewater
facility grants._
(A) Authority._
(i) In general._The; Secretary is authorized
to make grants aggregating not to exceed
[$590,000,000] $1,500,000,000 in any fiscal
year to such associations to finance specific
projects for works for the development,
storage, treatment, purification, or
distribution of water or the collection,
treatment, or disposal of waste in rural areas.
[The amount] (ii) Amount.--The amount of any
grant made under the authority of this
[paragraph] subparagraph shall not exceed 75
per centum of the development cost of the
project to serve the area which the association
determines can be feasibly served by the
facility and to adequately serve the reasonably
foreseeable growth needs of the area.
[The Secretary shall] (iii) Grant rate.--The
Secretary shall fix the grant rate for each
project in conformity with regulations issued
by the Secretary that shall provide for a
graduated scale of grant rates establishing
higher rates for projects in communities that
have lower community population and income
levels.
(B) Revolving funds for financing water and
wastewater projects.--
(i) In general.--The Secretary may make
grants to qualified private, nonprofit entities
to capitalize revolving funds for the purpose
of providing loans to eligible borrowers for--
(I) predevelopment costs associated
with proposed water and wastewater
projects or with existing water and
wastewater systems; and
(II) short-term costs incurred for
replacement equipment, small-scale
extension services, or other small
capital projects that are not part of
the regular operations and maintenance
activities of existing water and
wastewater systems.
(ii) Eligible borrowers.--To be eligible to
obtain a loan from a revolving fund under
clause (i), a borrower shall be eligible to
obtain a loan, loan guarantee, or grant under
paragraph (1) or this paragraph.
(iii) Maximum amount of loans.--The amount of
a loan made to an eligible borrower under this
subparagraph shall not exceed--
(I) $100,000 for costs described in
clause (i) (I); and
(II) $100,000 for costs described in
clause (i) (II).
(iv) Term.--The term of a loan made to an
eligible borrower under this subparagraph shall
not exceed 10 years.
(v) Administration.--The Secretary shall
limit the amount of grant funds that may be
used by a grant recipient for administrative
costs incurred under this subparagraph.
(vi) Authorization of appropriations.--There
is authorized to be appropriated to carry out
this subparagraph $30,000,000 for each of
fiscal years 2002 through 2006.
(3) No grant shall be made under paragraph (2) of this
subsection in connection with any project unless the Secretary
determines that the project (i) will serve a rural area which,
if such project is carried out, is not likely to decline in
population below that for which the project was designed, (ii)
is designed and constructed so that adequate capacity will or
can be made available to serve the present population of the
area to the extent feasible and to serve the reasonably
foreseeable growth needs of the area, and (iii) is necessary
for an orderly community development consistent with a
comprehensive community water, waste disposal, or other
development plan of the rural area.
(4)(A) The term ``development cost'' means the cost of
construction of a facility and the land, easements, and rights-
of-way, and water rights necessary to the construction and
operation of the facility.
* * * * * * *
(6) The Secretary may make grants aggregating not to exceed
$30,000,000 in any fiscal year to public bodies or such other
agencies as the Secretary may determine having authority to
prepare comprehensive plans for the development of water or
waste disposal systems in rural areas which do not have funds
available for immediate undertaking of the preparation of such
plan.
[(7)1 Definition of rural and rural areas.--For the purpose
of water and waste disposal grants and direct and guaranteed
loans provided under paragraphs (1) and (2), the terms
``rural'' and `'rural area'' mean a city, town, or
unincorporated area that has a population of no more than
10,000 inhabitants.]
(8) In each instance where the Secretary receives two or
more applications for financial assistance for projects that
would serve substantially the same group of residents within a
single rural area, and one such application is submitted by a
city, town, county or other unit of general local government,
he shall, in the absence of substantial reasons to the
contrary, provide such assistance to such city, town, county or
other unit of general local government.
* * * * * * *
(C) Coordination.--The Secretary shall ensure, to the
maximum extent practicable, that assistance provided
under this paragraph is coordinated with and delivered
in cooperation with similar services or assistance
provided to rural residents by the Cooperative State
Research, Education, and Extension Service or other
Federal agencies.
(D) Authorization of appropriations.--There are
authorized to be appropriated to carry out this
paragraph $7,500,000 for each of fiscal years 1996
through [2002] 2006.
(12)(A) The Secretary shall, in cooperation with
institutions eligible to receive funds under theAct of July 2,
1862 (12 Stat. 503, as amended; 7 U.S.C. 301, 307, and 308), or the Act
of August 30, 1890 (26 Stat. 417, as amended; 7 U.S.C. 321 and 328),
including the Tuskegee Institute and State, substate, and regional
planning bodies, establish a system for the dissemination of
information and technical assistance on federally sponsored or funded
programs. The system shall be for the use of institutions eligible to
receive funds under the Act of July 2, 1862 (12 Stat. 503
* * * * * * *
(B) Federal share.--
(i) In general.--Except as provided in clauses (ii)
and (iii), the Secretary shall, by regulation,
establish the amount of the Federal share of the cost
of the facility under this paragraph.
(ii) Maximum amount.--The amount of a grant provided
under this paragraph for a facility shall not exceed 75
percent of the cost of developing the facility.
(iii) Graduated scale.--The Secretary shall provide
for a graduated scale for the amount of the Federal
share provided under this paragraph, with higher
Federal shares for facilities in communities that have
lower community population and income levels, as
determined by the Secretary.
(C) Reservation of funds for senior facilities.--
(i) In general.--For each fiscal year, not less than
12.5 percent of the funds made available to carry out
this paragraph shall be reserved for grants to pay the
Federal share of the cost of developing and
constructing senior facilities, or carrying out other
projects that mainly benefit seniors, in rural areas.
(ii) Release.--Funds reserved under clause (i) for a
fiscal year shall be reserved only until April 1 of the
fiscal year.
(D) Reservation of funds for children's day care
facilities.--
(i) In general.--For each fiscal year, not less than
10 percent of the funds made available to carry out
this paragraph shall be reserved for grants to pay the
Federal share of the cost of developing and
constructing day care facilities for children in rural
areas.
(ii) Release.--Funds reserved under clause (i) for a
fiscal year shall be reserved only until April 1 of the
fiscal year.
(20) Community Facilities Grant Program for Rural
Communities With Extreme Unemployment and Severe Economic
Depression.--
* * * * * * *
(C) Authorization of appropriations.--There are
authorized to be appropriated to carry out this
paragraph $50,000,000 for fiscal year 2001 and such
sums as are necessary for each subsequent fiscal year,
of which not more than 5 percent of the amount made
available for a fiscal year shall be available for
community planning and implementation.
(22) Rural Water and Wastewater Circuit Rider Program.--
(A) In general.--The Secretary shall establish a
national rural water and wastewater circuit rider
program that is based on the rural water circuit rider
program of the National Rural Water Association that
(as of the date of enactment of this paragraph)
receives funding from the Secretary, acting through the
Rural Utilities Service.
(B) Relationship to existing program.--The program
established under subparagraph (A) shall not affect the
authority of the Secretary to carry out the circuit
rider program for which funds are made available under
the heading ``Rural Community Advancement Program'' of
title III of the Agriculture, Rural Development, Food
and Drug Administration, and Related Agencies
Appropriations Act, 2002.
(C) Authorization of appropriations.--There is
authorized to be appropriated to carry out this
paragraph $15,000,000 for each of fiscal years 2003
through 2006.
(23) Multijurisdictional Regional Planning Organizations.--
(A) Grants.--The Secretary shall provide grants to
multijurisdictional regional planning and development
organizations to pay the Federal share of the cost of
providing assistance to local governments to improve
the infrastructure, services, and business development
capabilities of local governments and local economic
development organizations.
(B) Priority.--In determining which organizations
will receive a grant under this paragraph, the
Secretary shall provide a priority to an organization
that--
(i) serves a rural area that, during the most
recent 5-year period--
(I) had a net out-migration of
inhabitants, or other population loss,
from the rural area that equals or
exceeds 5 percent of the population of
the rural area; or
(II) had a median household income
that is less than the nonmetropolitan
median household income of the
applicable State; and
(ii) has a history of providing substantive
assistance to local governments and economic
development organizations.
(C) Federal share.--A grant provided under this
paragraph shall be for not more than 75 percent of the
cost of providing assistance described in subparagraph
(A).
(D) Maximum amount of grants.--The amount of a grant
provided to an organization under this paragraph shall
not exceed $100,000.
(E) Authorization of appropriations.--There is
authorized to be appropriated to carry out this
paragraph $30,000,000 for each of fiscal years 2003
through 2006.''.
(24) Certified Nonprofit Organizations Sharing Expertise.--
(A) Certified organizations.--
(i) In general.--To be certified by the
Secretary to provide technical assistance in 1
or more rural development fields, an
organization shall--
(I) be a nonprofit organization
(which may include an institution of
higher education) with experience in
providing technical assistance in the
applicable rural development field;
(II) develop a plan, approved by the
Secretary, describing the manner in
which grant funds will be used and the
source of non-Federal funds; and
(III) meet such other criteria as the
Secretary may establish, based on the
needs of eligible entities for the
technical assistance.
(iii) List.--The Secretary shall make
available to the public a list of certified
organizations in each area that the Secretary
determines have substantial experience in
providing the assistance described in
subparagraph (B).
(B) Grants.--The Secretary may provide grants to
certified organizations to pay for costs of providing
technical assistance to local governments and nonprofit
entities to improve the infrastructure, services, and
business development capabilities of local governments
and local economic development organizations.
(C) Authorization of appropriations.--There is
authorized to be appropriated to carry out this
paragraph $20,000,000 for each of fiscal years 2003
through 2006.
(25) Loan Guarantees for Water, Wastewater, and Essential
Community Facilities Loans.--
(A) In general.--The Secretary may guarantee under
this title a loan made to finance a community facility
or water or waste facility project, including a loan
financed by the net proceeds of a bond described in
section 144(a)(12)(B)(ii) of the Internal Revenue Code
of 1986.
(B) Requirements.--To be eligible for a loan
guarantee under subparagraph (A), an individual or
entity offering to purchase the loan must demonstrate
to the Secretary that the person has--
(i) the capabilities and resources necessary
to service the loan in a manner that ensures
the continued performance of the loan, as
determined by the Secretary; and
(ii) the ability to generate capital to
provide borrowers of the loan with the
additional credit necessary to properly service
the loan
(26) Rural Firefighters and Emergency Medical Personnel
Grant Program.--
(A) In general.--The Secretary may make grants to
units of general local government and Indian tribes (as
defined in section 4 of the Indian Self-Determination
and Education Assistance Act (25 U.S.C. 450b)) to pay
the cost of training firefighters and emergency medical
personnel in firefighting, emergency medical practices,
and responding to hazardous materials and bioagents in
rural areas.
(B) Use of funds.--
(i) Scholarships.--
(I) In general.--Not less than 60
percent of the amounts made available
for competitively awarded grants under
this paragraph shall be used to provide
grants to fund partial scholarships for
training of individuals at training
centers approved by the Secretary.
(II) Priority.--In awarding grants
under this clause, the Secretary shall
give priority to grant applicants with
relatively low transportation costs
considering the location of the
grant applicant and the proposed location
of the training.
(ii) Grants for training centers.--
(I) Existing centers.--
(aa) In general.--A grant
under subparagraph (A) may be
used to provide financial
assistance to State and
regional centers that provide
training for firefighters and
emergency medical personnel for
improvements to the training
facility, equipment, curricula,
and personnel.
(bb) Limitation.--Not more
than $2,000,000 shall be
provided to any single training
center for any fiscal year
under this subclause.
(II) Establishment of new
centers.--
(aa) In general.--A grant
under subparagraph (A) may be
used to provide the Federal
share of the costs of
establishing a regional
training center for
firefighters and emergency
medical personnel.
(bb) Federal share.--The
amount of a grant under this
subclause for a training center
shall not exceed 50 percent of
the cost of establishing the
training center.
(C) Funding.--
(i) In general.--Out of any funds in the
Treasury not otherwise appropriated, the
Secretary of the Treasury shall transfer to the
Secretary of Agriculture to carry out this
paragraph--
(I) not later than 30 days after the
date of enactment of this Act,
$10,000,000; and
(II) on October 1, 2002, and each
October 1 thereafter through October 1,
2005, $30,000,000.
(ii) Receipt and acceptance.--The Secretary
shall be entitled to receive, shall accept, and
shall use to carry out this section the funds
transferred under clause (i), without further
appropriation.
(iii) Availability of funds.--Funds
transferred under clause (i) shall remain
available until expended.
(b) The service provided or made available through any such
association shall not be curtailed or limited by inclusion of
the area served by such association within the boundaries of
any municipal corporation or other public body, or by the
granting of any private franchise for similar service within
such area during the term of such loan; nor shall the happening
of any such event be the basis of requiring such association to
secure any franchise, license, or permit as a condition to
continuing to serve the area served by the association at the
time of the occurrence of such event.
* * * * * * *
SEC. 306A. EMERGENCY COMMUNITY WATER ASSISTANCE GRANT PROGRAM.
(a) In General.--The Secretary shall provide grants in
accordance with this section to assist the residents of rural
areas and small communities to secure adequate quantities of
safe water--
(1) after a significant decline in the quantity or
quality of water available from the water supplies of
such rural areas and small communities; or
(2) when repairs, partial replacement, or significant
maintenance efforts on established water systems would
remedy--
(A) an acute shortage of quality water; or
(B) a significant decline in the quantity or
quality of water that is available.
(b) Priority.--In carrying out subsection (a), the
Secretary shall--
(1) give priority to projects described in subsection
(a)(1); and
(2) provide at least 70 percent of all such grants to
such projects.
(c) Eligibility.--To be eligible to obtain a grant under
this section, an applicant shall--
(1) be a public or private nonprofit entity; and
(2) in the case of a grant made under subsection
(a)(1), demonstrate to the Secretary that the decline
referred to in such subsection occurred within 2 years
of the date the application was filed for such grant.
(d) Uses.--
(1) In general.--Grants made under this section may
be used for waterline extensions from existing systems,
laying of new waterlines, repairs, significant
maintenance, digging of new wells, equipment
replacement, hook and tap fees, and any other
appropriate purpose associated with developing sources
of, or treating, storing, or distributing water, and to
assist communities in complying with the requirements of
the Federal Water Pollution Control Act (33 U.S.C. 1251
et seq.) or the Safe Drinking Water Act (42 U.S.C. 300f
et seq.).
(2) Joint proposals.--Nothing in this section shall
preclude rural communities from submitting joint
proposals for emergency water assistance, subject to
the restrictions contained in subsection (e). Such
restrictions should be considered in the aggregate,
depending on the number of communities involved.
(e) Restrictions.--
(1) Maximum population and income.--No grant provided
under this section shall be used to assist any rural
area or community that--
(A) includes any area in any city or town
with a population in excess of 10,000
inhabitants according to the most recent
decennial census of the United States; or
(B) has a median household income in excess
of the State nonmetropolitan median household
income according to the most recent decennial
census of the United States.
(2) Set-aside for smaller communities.--Not less than
50 percent of the funds allocated under this section
shall be allocated to rural communities with
populations that do not exceed 3,000 inhabitants.
(f) Maximum Grants.--Grants made under this section may not
exceed--
(1) in the case of each grant made under subsection
(a)(1), $500,000; and
(2) in the case of each grant made under subsection
(a)(2), $75,000.
(g) Full Funding.--Subject to subsection (e), grants under
this section shall be made in an amount equal to 100 percent of
the costs of the projects conducted under this section.
(h) Application.--
(1) Nationally competitive application process.--The
Secretary shall develop a nationally competitive
application process to award grants under this section.
The process shall include criteria for evaluating
applications, including population, median household
income, and the severity of the decline in quantity or
quality of water.
(2) Timing.--The Secretary shall make every effort to
review and act on applications within 60 days of the
date that such applications are submitted.
(i) Authorization of
appropriations.--There are authorized
to be appropriated to carry out this
section $35,000,000 for each of fiscal
years 1996 through [2002] 2006.
SEC. 306C. WATER AND WASTE FACILITY LOANS AND GRANTS TO ALLEVIATE
HEALTH RISKS.
(a) Loans and Grants to Persons Other Than Individuals.--
(1) In general.--The Secretary shall make or insure
loans and make grants to rural water supply
corporations, cooperatives, or similar entities, Indian
tribes on Federal and State reservations and other
federally recognized Indian tribes, and public
agencies, to provide for the conservation, development,
use, and control of water (including the extension or
improvement of existing water supply systems), and the
installation or improvement of drainage or waste
disposal facilities and essential community facilities
including necessary related equipment. Such loans and
grants shall be available only to provide such water
and waste facilities and services to communities whose
residents face significant health risks, as determined
by the Secretary, due to the fact that a significant
proportion of the community's residents do not have
access to, or are not served by, adequate affordable--
(A) water supply systems; or
(B) waste disposal facilities.
(2) Certain areas targeted.--
(A) In general.--Loans and grants under
paragraph (1) shall be made only if the loan or
grant funds will be used primarily to provide
water or waste services, or both, to residents
of a county--
(i) the per capita income of the
residents of which is not more than 70
percent of the national average per
capita income, as determined by the
Department of Commerce; and
(ii) the unemployment rate of the
residents of which is not less than 125
percent of the national average
unemployment rate, as determined by the
Bureau of Labor Statistics.
(B) Exception.--Notwithstanding subparagraph
(A), loans and grants under paragraph (1) may
also be made if the loan or grant funds will be
used primarily to provide water or waste
services, or both, to residents of a rural area
that was recognized as a colonia as of October
1, 1989.
(b) Loans and Grants to Individuals.--
(1) In general.--The Secretary shall make or insure
loans and make grants to individuals who reside in a
community described in subsection (a)(1) for the
purpose of extending water supply and waste disposal
systems, connecting the systems to the residences of
the individuals, or installing plumbing and fixtures
within the residences of the individuals to facilitate
the use of the water supply and waste disposal systems.
Such loans shall be at a rate of interest no greater
than the Federal Financing Bank rate on loans of a
similar term at the time such loans are made. The
repayment of such loans shall be amortized over the
expected life of the water supply or waste disposal
system to which the residence of the borrower will be
connected.
(2) Manner in which loans and grants are to be
made.--Loans and grants to individuals under paragraph
(1) shall be made--
(A) directly to such individuals by the
Secretary; or
(B) to such individuals through the rural
water supply corporation, cooperative, or
similar entity, or public agency, providing
such water supply or waste disposal services,
pursuant to regulations issued by the
Secretary.
(c) Preference.--The Secretary shall give preference in the
awarding of loans and grants--
(1) under subsection (a) to rural water supply
corporations, cooperatives, or similar entities, or
public agencies, that propose to provide water supply
or waste disposal services to the residents of those
rural subdivisions commonly referred to as colonias,
that are characterized by substandard housing,
inadequate roads and drainage, and a lack of adequate
water or waste facilities; and
(2) under subsection (b) to individuals who reside in
a rural subdivision commonly referred to as a colonia,
that is characterized by substandard housing,
inadequate roads and drainage, and a lack of adequate
water or waste facilities.
(d) Cooperative Defined.--For purposes of this section, the
term ``cooperative'' means a cooperative formed specifically
for the purpose of the installation, expansion, improvement, or
operation of water supply or waste disposal facilities or
systems.
[(e) Limitations on Authorization of Appropriations.--There
are authorized to be appropriated--]
(e) Authorization of Appropriations.--
(1) In general.--Subject to paragraph (2), there is
authorized to be appropriated--
(A) for grants under this section,
$30,000,000 for each fiscal year;
(B) for loans under this section, $30,000,000
for each fiscal year; and
(C) for grants under this section to benefit
Indian tribes (as defined in section 4 of the
Indian Self-Determination and Education
Assistance Act (25 U.S.C. 450b)), $20,000,000
for each fiscal year.
(2) Exception.--An entity eligible to receive funding
through a grant made under section 306D shall not be
eligible for a grant from funds made available under
subparagraph (1)(C).
(1) for grants under this section, $30,000,000 for
each fiscal year; and
(2) for loans under this section, $30,000,000 for
each fiscal year.
(f) Regulations.--Not later than 30 days after the date of
enactment of this subsection, the Secretary shall issue interim
final regulations, with a request for public comments,
implementing this section.
SEC. 306D. WATER SYSTEMS FOR RURAL AND NATIVE VILLAGES IN ALASKA.
(a) In General.--The Secretary may make grants to the State
of Alaska for the benefit of rural or Native villages in Alaska
to provide for the development and construction of water and
wastewater systems to improve the health and sanitation
conditions in those villages.
(b) Matching Funds.--To be eligible to receive a grant
under subsection (a), the State of Alaska shall provide 25
percent in matching funds from non-Federal sources.
(c) Consultation With the State of Alaska.--The Secretary
shall consult with the State of Alaska on a method of
prioritizing the allocation of grants under subsection (a)
according to the needs of, and relative health and sanitation
conditions in, each village.
(d) Authorization of Appropriations.--
(1) In general.--There are authorized to be
appropriated to carry out this section $30,000,000 for
each of fiscal years 2001 and [2002] 2006.
(2) Training and technical assistance.--Not more than
2 percent of the amount made available under paragraph
(1) for a fiscal year may be used by the State of
Alaska for training and technical assistance programs
relating to the operation and management of water and
waste disposal services in rural and Native villages.
* * * * * * *
Sec. 310B. (a) The Secretary may also make and insure loans
to public, private, or cooperative organizations organized for
profit or nonprofit, to Indian tribes on Federal and State
reservations or other federally recognized Indian tribal
groups, or to individuals for the purposes of (1) improving,
developing, or financing business, industry, and employment and
improving the economic and environmental climate in rural
communities, including pollution abatement and control, (2) the
conservation, development, and use of water for aquaculture
purposes in rural areas, (3) reducing the reliance on
nonrenewable energy resources by encouraging the development
and construction of solar energy systems, including the
modification of existing systems, in rural areas, and (4) to
facilitate economic opportunity for industries undergoing
adjustment from terminated Federal agricultural price and
income support programs or increased competition from foreign
trade. For the purposes of this subsection, the term ``solar
energy'' means energy derived from sources (other than fossil
fuels) and technologies included in the Federal Nonnuclear
Energy Research and Development Act of 1974, as amended. Such
loans, when originated, held, and serviced by other lenders,
may be guaranteed by the Secretary under this section without
regard to paragraphs (1) and (4) of section 333. As used in
this subsection, the term ``aquaculture'' means the culture or
husbandry of aquatic animals or plants by private industry for
commercial purposes including the culture and growing of fish
by private industry for the purpose of creating or augmenting
publicly owned and regulated stocks of fish. No loan may be
made, insured, or guaranteed under this subsection that exceeds
$25,000,000 in principal amount.
(b) Solid Waste Management Grants.--The Secretary may make
grants to nonprofit organizations for the provision of regional
technical assistance to local and regional governments and
related agencies for the purpose of reducing or eliminating
pollution of water resources and improving the planning and
management of solid waste disposal facilities. Grants made
under this paragraph for the provision of technical assistance
shall be made for 100 percent of the cost of such assistance.
(c) Rural Business Enterprise Grants.--
(1) In general.--The Secretary may also make grants,
not to exceed $50,000,000 annually, to public bodies
and private nonprofit corporations for measures
designed to finance and facilitate development of small
and emerging private business enterprises (including
nonprofit entities) or the creation, expansion, and
operation of rural distance learning networks or rural
learning programs that provide educational instruction
or job training instruction related to potential
employment or job advancement to adult students,
including the development, construction or acquisition
of land, buildings, plants, equipment, access streets
and roads, parking areas, utility extensions, necessary
water supply and waste disposal facilities,
refinancing, services and fees.
(2) Passenger transportation services or
facilities.--The Secretary may award grants on a
competitive basis to qualified nonprofit organizations
for the provision of technical assistance and training
to rural communities for the purpose of improving
passenger transportation services or facilities.
Assistance provided under this paragraph may include
on-site technical assistance to local and regional
governments, public transit agencies, and related
nonprofit and for-profit organizations in rural areas,
the development of training materials, and the
provision of necessary training assistance to local
officials and agencies in rural areas.
(3) Grants to aid industries in adjusting to
terminated federal agricultural programs or increased
foreign competition.--The Secretary may make grants
under this section to facilitate economic opportunity
for industries undergoing adjustment from terminated
Federal agricultural price and income support programs
or increased competition from foreign trade.
(d)(1) The Secretary may participate in joint financing to
facilitate development of private business enterprises in rural
areas with the Economic Development Administration, the Small
Business Administration, and the Department of Housing and
Urban Development and other Federal and State agencies and with
private and quasi-public financial institutions, through joint
loans to applicants eligible under subsection (a) for the
purpose of improving, developing, or financing business,
industry, and employment and improving the economic and
environmental climate in rural areas or through joint grants to
applicants eligible under subsection (c) for such purposes,
including in the case of loans or grants the development,
construction, or acquisition of land, buildings, plants,
equipment, access streets and roads, parking areas, utility
extensions, necessary water supply and waste disposal
facilities, refining, service and fees.
(2) No financial or other assistance shall be extended
under any provision of this section, except for cases in which
such assistance does not exceed $1,000,000 or for cases in
which direct employment will not be increased by more than
fifty employees, that is calculated to or is likely to result
in the transfer from one area to another of any employment or
business activity provided by operations of the applicant, but
this limitation shall not be construed to prohibit assistance
for the expansion of an existing business entity through the
establishment of a new branch, affiliate, or subsidiary of such
entity if the establishment of such branch, affiliate, or
subsidiary will not result in an increase in unemployment in
the area of original location or in any other area where such
entity conducts business operations unless there is reason to
believe that such branch, affiliate, or subsidiary is being
established with the intention of closing down the operations
of the existing business entity in the area of its original
location or in any other area where it conducts such
operations.
(3) No financial or other assistance shall be extended
under any provision of this section, except for cases in which
such assistance does not exceed $1,000,000 or for cases in
which direct employment will not be increased by more than
fifty employees, which is calculated to or likely to result in
an increase in the production of goods, materials, or
commodities, or the availability of services or facilities in
the area, when there is not sufficient demand for such goods,
materials, commodities, services, or facilities, to employ the
efficient capacity of existing competitive commercial or
industrial enterprises, unless such financial or other
assistance will not have an adverse effect upon existing
competitive enterprises in the area.
(4) No financial or other assistance shall be extended
under any provision of this section,except for cases in which
such assistance does not exceed $1,000,000 or for cases in which direct
employment will not be increased by more than fifty employees, if the
Secretary of Labor certifies within 30 days after the matter has been
submitted to him by the Secretary of Agriculture that the provisions of
paragraphs (2) and (3) of this subsection have not been complied with.
The Secretary of Labor shall, in cooperation with the Secretary of
Agriculture, develop a system of certification which will insure the
expeditious processing of requests for assistance under this section.
(5) No grant or loan authorized to be made under this title
shall require or be subject to the prior approval of any
officer, employee, or agency of any State.
(6) No loan commitment issued under this section shall be
conditioned upon the applicant investing in excess of 10 per
centum in the business or industrial enterprise for which
purpose the loan is to be made unless the Secretary determines
there are special circumstances which necessitate an equity
investment by the applicant greater than 10 per centum.
(7) No provision of law shall prohibit issuance by the
Secretary of certificates evidencing beneficial ownership in a
block of notes insured or guaranteed under this title or Title
V of the Housing Act of 1949; any sale by the Secretary of such
certificates shall be treated as a sale of assets for the
purposes of the Budget and Accounting Act of 1921. Any security
representing beneficial ownership in a block of notes
guaranteed or insured under this title or Title V of the
Housing Act of 1949 issued by a private entity shall be exempt
from laws administered by the Securities and Exchange
Commission, except sections 17, 22, and 24 of the Securities
Act of 1933, as amended; however, the Secretary shall require
(i) that the issuer place such notes in the custody of an
institution chartered by a Federal or State agency to act as
trustee and (ii) that the issuer provide such periodic reports
of sales as the Secretary deems necessary.
(e) Rural Cooperative Development Grants.--
(1) Definitions.--In this subsection:
(A) Nonprofit institution.--The term
``nonprofit institution'' means any
organization or institution, including an
accredited institution of higher education, no
part of the net earnings of which inures, or
may lawfully inure, to the benefit of any
private shareholder or individual.
(B) United states.--The term ``United
States'' means the several States, the District
of Columbia, the Commonwealth of Puerto Rico,
the Virgin Islands, Guam, American Samoa, and
the other territories and possessions of the
United States.
(2) Grants.--The Secretary shall make grants
effective October 1, 1996, under this subsection to
nonprofit institutions for the purpose of enabling the
institutions to establish and operate centers for rural
cooperative development.
(3) Goals.--The goals of a center funded under this
subsection shall be to facilitate the creation of jobs
in rural areas through the development of new rural
cooperatives, value added processing, and rural
businesses.
(4) Application.--Any nonprofit institution seeking a
grant under paragraph (2) shall submit to the Secretary
an application containing a plan for the establishment
and operation by the institution of a center or centers
for cooperative development. The Secretary may approve
the application if the plan contains the following:
(A) A provision that substantiates that the
center will effectively serve rural areas in
the United States.
(B) A provision that the primary objective of
the center will be to improve the economic
condition of rural areas through cooperative
development.
(C) A description of the activities that the
center will carry out to accomplish the
objective. The activities may include the
following:
(i) Programs for applied research and
feasibility studies that may be useful
to individuals, cooperatives, small
businesses, and other similar entities
in rural areas served by the center.
(ii) Programs for the collection,
interpretation, and dissemination of
information that may be useful to
individuals, cooperatives, small
businesses, and other similar entities
in rural areas served by the center.
(iii) Programs providing training and
instruction for individuals,
cooperatives, small businesses, and
other similar entities in rural areas
served by the center.
(iv) Programs providing loans and
grants to individuals, cooperatives,
small businesses, and other similar
entities in rural areas served by the
center.
(v) Programs providing technical
assistance, research services, and
advisory services to individuals,
cooperatives, small businesses, and
other similar entities in rural areas
served by the center.
(vi) Programs providing for the
coordination of services and sharing of
information among the center.
(D) A description of the contributions that
the activities are likely to make to the
improvement of the economic conditions of the
rural areas for which the center will provide
services.
(E) Provisions that the center, in carrying
out the activities, will seek, where
appropriate, the advice, participation,
expertise, and assistance of representatives of
business, industry, educational institutions,
the Federal Government, and State and local
governments.
(F) Provisions that the center will take all
practicable steps to develop continuing sources
of financial support for the center,
particularly from sources in the private
sector.
(G) Provisions for--
(i) monitoring and evaluating the
activities by the nonprofit institution
operating the center; and
(ii) accounting for money received by
the institution under this section.
(5) Awarding grants.--Grants made under paragraph (2)
shall be made on a competitive basis. In making grants
under paragraph (2), the Secretary shall give
preference to grant applications providing for the
establishment of centers for rural cooperative
development that--
(A) demonstrate a proven track record in
administering a nationally coordinated,
regionally or State-wide operated project;
(B) demonstrate previous expertise in
providing technical assistance in rural areas;
(C) demonstrate the ability to assist in the
retention of businesses, facilitate the
establishment of cooperatives and new
cooperative approaches, and generate employment
opportunities that will improve the economic
conditions of rural areas;
(D) demonstrate the ability to create
horizontal linkages among businesses within and
among various sectors in rural areas of the
United States and vertical linkages to domestic
and international markets;
(E) commit to providing technical assistance
and other services to underserved and
economically distressed areas in rural areas of
the United States; and
(F) commit to providing greater than a 25
percent matching contribution with private
funds and in-kind contributions.
(6) 1-year grants; authority to approve grant for 1
additional year without application.--The Secretary
shall make grants under this subsection for a period of
1 year. The Secretary shall evaluate programs receiving
assistance under this subsection. If the Secretary
determines it to be in the best interest of the
program, the Secretary may award an additional grant to
the program for the immediately succeeding year without
application for the grant.
(7) Technical assistance to prevent excessive
unemployment or underemployment.--In carrying out this
subsection, the Secretary may provide technical
assistance to alleviate or prevent conditions of
excessive unemployment, underemployment, outmigration,
or low employment growth in economically distressed
rural areas that the Secretary determines have a
substantial need for the assistance. The assistance may
include planning and feasibility studies, management
and operational assistance, and studies evaluating the
need for development potential of projects that
increase employment and improve economic growth in the
areas.
(8) Grants to defray administrative costs.--The
Secretary may make grants to defray not to exceed 75
percent of the costs incurred by organizations and
public bodies to carry out projects for which grants or
loans are made under this subsection. For purposes of
determining the non-Federal share of the costs, the
Secretary shall consider contributions in cash and in
kind, fairly evaluated, including premises, equipment,
and services.
(9) Authorization of appropriations.--There are
authorized to be appropriated to carry out this
subsection $50,000,000 for each of fiscal years 1996
through [2002] 2006.
(f) Grants to Broadcasting Systems.--
(1) Definition of statewide.--In this subsection, the
term ``statewide'' means having a coverage area of not
less than 90 percent of the population of a State and
not less than 80 percent of the rural land area of the
State (as determined by the Secretary).
(2) Grants.--The Secretary may make grants to
statewide private nonprofit public television systems,
whose coverage area is predominately rural, for the
purpose of demonstrating the effectiveness of such
systems in providing information on agriculture and
other issues of importance to farmers and other rural
residents. Grants available under this paragraph may be
used for capital equipment expenditures, start-up and
program costs, and other costs necessary to the
operation of such demonstrations.
(3) Authorization of appropriations.--There is
authorized to be appropriated to carry out this
subsection $5,000,000 for each of fiscal years 2002
through 2006.
[(g) Loan Guarantees for the Purchase of Cooperative
Stock.--
[(1) Definition of farmer.--In this subsection, the
term ``farmer'' means any farmer that the Secretary
determines is a family farmer.
[(2) Loan guarantees.--The Secretary may guarantee
loans under this section to individual farmers for the
purpose of purchasing start-up capital stock of a
farmer cooperative established for the purpose of
processing an agricultural commodity.
[(3) Eligibility.--To be eligible for a loan
guarantee under this subsection, a farmer must produce
the agricultural commodity that will be processed by
the cooperative.]
(g) Business and Industry Direct and Guaranteed Loans.--
(1) Loan guarantees for the purchase of cooperative
stock.--
(A) New and expanding cooperatives.--
(i) In general.--The Secretary may
guarantee a loan under subsection (a)
to farmers, ranchers, or cooperatives
for the purpose of purchasing start-up
capital stock for the expansion or
creation of a cooperative venture that
will process agricultural commodities
or otherwise process value-added
agricultural products.
(ii) Financial condition.--In
determining the appropriateness of a
loan guarantee under this subparagraph,
the Secretary--
(I) shall fully review the
feasibility and other relevant
aspects of the cooperative
venture to be established;
(II) may not require a review
of the financial condition or
statements of any individual
farmer or rancher involved in
the cooperative, other than the
applicant for a guarantee under
this subparagraph; and
(III) shall base any
guarantee, to the maximum
extent practicable, on the
merits of the cooperative
venture to be established.
(iii) Collateral.--As a condition of
making a loan guarantee under this
subparagraph, the Secretary may not
require additional collateral by a
farmer or rancher, other than stock
purchased or issued pursuant to the
loan and guarantee of the loan.
(iv) Eligibility.--To be eligible for
a loan guarantee under this
subparagraph, a farmer or rancher must
produce the agricultural commodity that
will be processed by the cooperative.
(v) Processing contracts during
initial period.--The cooperative, for
which a farmer or rancher receives a
guarantee to purchase stock under this
subparagraph, may contract for services
to process agricultural commodities, or
otherwise process value-added
agricultural products, during the 5-
year period beginning on the date of
the startup of the cooperative in order
to provide adequate time for the
planning and construction of the
processing facility of the cooperative.
(B) Existing cooperatives.--The Secretary may
guarantee a loan under subsection (a) to a
farmer or rancher to join a cooperative in
order to sell the agricultural commodities or
products produced by the farmer or rancher.
(C) Financial information.--Financial
information required by the Secretary from a
farmer or rancher as a condition of making a
loan guarantee under this paragraph shall be
provided in the manner generally required by
commercial agricultural lenders in the area.
(2) Loans to cooperatives.--
(A) In general.--The Secretary may make or
guarantee a loan under subsection (a) to a
cooperative that is headquartered in a
metropolitan area if the loan is used for a
project or venture described in subsection (a)
that is located in a rural area.
(B) Refinancing.--A cooperative organization
owned by farmers or ranchers that is eligible
for a business and industry loan under made or
guaranteed under subsection (a) shall be
eligible to refinance an existing loan with a
lender if--
(i) the cooperative organization--
(I) is current and performing
with respect to the existing
loan; and
(II) is not, and has not
been, in default with respect
to the existing loan; and
(ii) there is adequate security or
full collateral for the refinanced
loan.
(3) Business and industry loan appraisals.--The
Secretary may require that any appraisal made in
connection with a business and industry loan made or
guaranteed under subsection (a) be conducted by a
specialized appraiser that uses standards that are
similar to standards used for similar purposes in the
private sector, as determined by the Secretary.
(4) Fees.--The Secretary may assess a 1-time fee for
any loan guaranteed under subsection (a) in an amount
that does not exceed 2 percent of the guaranteed
principal portion of the loan.''.
(h) Loan Guarantee for Certain Loans.--The Secretary may
guarantee loans made in subsection (a) to finance the issuance
of bonds for the projects described in section 306(a)(25)
(i) Value-Added Intermediary Relending Program.--
(1) In general.--In accordance with this subsection,
the Secretary shall make loans under the terms and
conditions of the intermediary relending program
established under section 1323(b)(2)(C) of the Food
Security Act of 1985 (7 U.S.C. 1932 note; Public Law
99-198).
(2) Loans.--Using funds made available to carry out
this subsection, the Secretary shall make loans to
eligible intermediaries to make loans to ultimate
recipients, under the terms and conditions of the
intermediary relending program, for projects to
establish, enlarge, and operate enterprises that add
value to agricultural commodities and products of
agricultural commodities.
(3) Eligible intermediaries.--Intermediaries that are
eligible to receive loans under paragraph (2) shall
include State agencies.
(4) Preference for bioenergy projects.--In making
loans using loan funds made available under paragraph
(2), an eligible intermediary shall give preference to
bioenergy projects in accordance with regulations
promulgated by the Secretary.
(5) Composition of capital.--The capital for a
project carried out by an ultimate recipient and
assisted with loan funds made available under paragraph
(2) shall be comprised of--
(A) not more than 15 percent of the total
cost of a project; and
(B) not less than 50 percent of the equity
funds provided by agricultural producers.
(6) Loan conditions.--
(A) Terms of loans.--A loan made to an
intermediary using loan funds made available
under paragraph (2) shall have a term of not to
exceed 30 years.
(B) Interest.--The interest rate on such a
loan shall be--
(i) in the case of each of the first
2 years of the loan period, 0 percent;
and
(ii) in the case of each of the
remaining years of the loan period, 2
percent.
(7) Limitations on amount of loan funds provided.--
(A) In general.--Except as provided in
subparagraph (B), an intermediary or ultimate
recipient shall be eligible to receive not more
than $2,000,000 of the loan funds made
available under paragraph (2).
(B) State agencies.--Subparagraph (A) shall
not apply in the case of a State agency with
respect to loan funds provided to the State
agency as an intermediary.
(8) Authorization of appropriations.--There is
authorized to be appropriated to carry out this
subsection $15,000,000 for each of fiscal years 2003
through 2006.''.
* * * * * * *
SEC. 310G. USE OF RURAL DEVELOPMENT LOANS AND GRANTS FOR OTHER
PURPOSES.
If, after making a loan or a grant described in section
381E(d), the Secretary determines that the circumstances under
which the loan or grant was made have sufficiently changed to
make the project or activity for which the loan or grant was
made available no longer appropriate, the Secretary may allow
the loan borrower or grant recipient to use property (real and
personal) purchased or improved with the loan or grant funds,
or proceeds from the sale of property (real and personal)
purchased with such funds, for another project or activity that
(as determined by the Secretary)--
(1) will be carried out in the same area as the
original project or activity;
(2) meets the criteria for a loan or a grant
described in section 381E(d); and
(3) satisfies such additional requirements as are
established by the Secretary.
Subtitle B--Operating Loans
* * * * * * *
Sec. 333A. (a)(1) The Secretary shall approve or disapprove
an application for a loan or loan guarantee made under this
title, and notify the applicant of such action, not later than
60 days after the Secretary has received a complete application
for such loan or loan guarantee.
(2)(A) If an application for a loan or loan guarantee under
this title (other than under subtitle B) is incomplete, the
Secretary shall inform the applicant of the reasons such
application is incomplete not later than 20 days after the
Secretary has received such application.
(B)(i) Not later than 10 calendar days after the Secretary
receives an application for an operating loan or loan guarantee
under subtitle B, the Secretary shall notify the applicant of
any information required before a decision may be made on the
application. On receipt of an application, the Secretary shall
request from other parties such information as may be needed in
connection with the application.
(ii) Not later than 15 calendar days after the date an
agency of the Department of Agriculture receives a request for
information made pursuant to clause (i), the agency shall
provide theSecretary with the requested information.
(iii) If, not later than 20 calendar days after the date a
request is made pursuant to clause (i) with respect to an
application, the Secretary has not received the information
requested, the Secretary shall notify the applicant and the
district office of the Farmers Home Administration, in writing,
of the outstanding information.
(iv) A county office shall notify the district office of
the Farmers Home Administration of each application for an
operating loan or loan guarantee under subtitle B that is
pending more than 45 days after receipt, and the reasons the
application is pending.
(v) A district office that receives a notice provided under
clause (iv) with respect to an application shall immediately
take steps to ensure that final action is taken on the
application not later than 15 days after the date of the
receipt of the notice.
(vi) The district office shall report to the State office
of the Farmers Home Administration on each application for an
operating loan or loan guarantee under subtitle B that is
pending more than 45 days after receipt by the county
committee, and the reasons the application is pending.
(vii) Each month, the Secretary shall notify the Committee
on Agriculture of the House of Representatives and the
Committee on Agriculture, Nutrition, and Forestry of the
Senate, on a State-by-State basis, as to each application for
an operating loan or loan guarantee under subtitle B on which
final action had not been taken within 60 calendar days after
receipt by the Secretary, and the reasons final action had not
been taken.
(3) If an application for a loan or loan guarantee under
this title is disapproved by the Secretary, the Secretary shall
state the reasons for the disapproval in the notice required
under paragraph (1).
(4)(A) Notwithstanding paragraph (1), each application for
a loan or loan guarantee under section 310B(a), or for a loan
under section 306(a), that is to be disapproved by the
Secretary solely because the Secretary lacks the necessary
amount of funds to make the loan or guarantee shall not be
disapproved but shall be placed in pending status.
(B) The Secretary shall retain the pending application and
reconsider the application beginning on the date that
sufficient funds become available.
(C) Not later than 60 days after funds become available
regarding each pending application, the Secretary shall notify
the applicant of the approval or disapproval of funding for the
application.
(b)(1) Except as provided in paragraph (2), if an
application for an insured loan under this title is approved by
the Secretary, the Secretary shall provide the loan proceeds to
the applicant not later than 15 days (or such longer period as
the applicant may approve) after the application for the loan
is approved by the Secretary.
(2) If the Secretary is unable to provide the loan proceeds
to the applicant within such 15-day period because sufficient
funds are not available to the Secretary for such purpose, the
Secretary shall provide the loan proceeds to the applicant as
soon as practicable (but in no event later than 15 days unless
the applicant agrees to a longer period) after sufficient funds
for such purpose become available to the Secretary.
(c) If an application for a loan or loan guarantee under
this title is disapproved by the Secretary, but such action is
subsequently reversed or revised as the result of an appeal
within the Department of Agriculture or to the courts of the
United States and the application is returned to the Secretary
for further consideration, the Secretary shall act on the
application and provide the applicant with notice of the action
within 15 days after return of the application to the
Secretary.
(d) In carrying out the approved lender program established
by exhibit A to subpart B of part 1980 of title 7, Code of
Federal Regulations, the Secretary shall ensure that each
request of a lending institution for designation as an approved
lender under such program is reviewed, and a decision made on
the application, not later than 15 days after the Secretary has
received a complete application for such designation.
(e)(1) As soon as practicable after the date of enactment
of the Food Security Act of 1985, the Secretary shall take such
steps as are necessary to make personnel, including the payment
of overtime for such personnel, and other resources of the
Department of Agriculture available to the Farmers Home
Administration as are sufficient to enable the Farmers Home
Administration to expeditiously process loan applications that
are submitted by farmers and ranchers.
(2) In carrying out paragraph (1), the Secretary may use
any authority of law provided to the Secretary, including--
(A) the Agricultural Credit Insurance Fund
established under section 309; and
(B) the employment procedures used in connection with
the emergency loan program established under subtitle
C.
(f)(1) As used in this subsection:
(A) The term ``approved lender'' means a lender
approved prior to the date of enactment of this
subsection by the Secretary under the approved lender
program established by exhibit A to subpart B of part
1980 of title 7, Code of Federal Regulations (as in
effect on January 1, 1991), or a lender certified under
section 1141.
(B) The term ``seasoned direct loan borrower'' means
a borrower receiving a direct loan under this title who
has been classified as ``commercial'' or ``standard''
under subpart W of part 2006 of the Instruction Manual
(as in effect on January 1, 1991).
(2) The Secretary, or a contracting third party, shall
annually review under section 360 the loans of each seasoned
loan borrower. If, based on the review, it is determined that a
borrower would be able to obtain a loan, guaranteed by the
Secretary, from a commercial or cooperative lender at
reasonable rates and terms for loans for similar purposes and
periods of time, the Secretary shall assist the borrower in
applying for the commercial or cooperative loan.
(3) In accordance with section 362, the Secretary shall
prepare a prospectus on each seasoned direct loan borrower
determined eligible to obtain a guaranteed loan. The prospectus
shall contain a description of the amounts of loan guarantee
and interest assistance that the Secretary will provide to the
seasoned direct loan borrower to enable the seasoned direct
loan borrower to carry out a financially viable farming plan if
a guaranteed loan is made.
(4) Verification.--
(A) In general.--The Secretary shall provide a
prospectus of a seasoned direct loan borrower to each
approved lender whose lending area includes the
location of the seasoned direct loan borrower.
(B) Notification.--The Secretary shall notify each
borrower of a loan that a prospectus has been provided
to a lender under subparagraph (A).
(C) Credit extended.--If the Secretary receives an
offer from an approved lender to extend credit to the
seasoned direct loan borrower under terms and
conditions contained in the prospectus, the seasoned
direct loan borrower shall not be eligible for an
insured loan from the Secretary under subtitle A or B,
except as otherwise provided in this subsection.
(5) If the Secretary is unable to provide loan guarantees
and, if necessary, interest assistance to the seasoned direct
loan borrower under this subsection in amounts sufficient to
enable the seasoned direct loan borrower to borrow from
commercial sources the amount required to carry out a
financially viable farming plan, or if the Secretary does not
receive an offer from an approved lender to extend credit to a
seasoned direct loan borrower under the terms and conditions
contained in the prospectus, the Secretary shall make an
insured loan to the seasoned direct loan borrower under
subtitle A or B, whichever is applicable.
(6) To the extent necessary for the borrower to obtain a
loan, guaranteed by the Secretary, from a commercial or
cooperative lender, the Secretary shall provide interest rate
reductions as provided for under section 351.
[(g)(1) The Secretary shall provide to lenders a short,
simplified application form for guarantees under this title of
loans the principal amount of which is $50,000 or less.
[(2) In developing the application, the Secretary shall--
[(A) consult with commercial and cooperative lenders;
and
[(B) ensure that--
[(i) the form can be completed manually or
electronically, at the option of the lender;
[(ii) the form minimizes the documentation
required to accompany the form;
[(iii) the cost of completing and processing
the form is minimal; and
[(iv) the form can be completed and processed
in an expeditious manner.]
(g) Simplified Application Forms for Loan Guarantees.--
(1) In general.--The Secretary shall provide to
lenders a short, simplified application form for
guarantees under this title of--
(A) farmer program loans the principal amount
of which is $100,000 or less; and
(B) business and industry guaranteed loans
under section 310B(a)(1) the principal amount
of which is--
(i) in the case of a loan guarantee
made during fiscal year 2002 or 2003,
$400,000 or less; and
(ii) in the case of a loan guarantee
made during any subsequent fiscal
year--
(I) $400,000 or less; or
(II) if the Secretary
determines that there is not a
significant increased risk of a
default on the loan, $600,000
or less.
(2) Water and waste disposal grants and loans.--The
Secretary shall develop an application process that
accelerates, to the maximum extent practicable, the
processing of applications for water and waste disposal
grants or direct or guaranteed loans under paragraph
(1) or (2) of section 306(a) the grant award amount or
principal loan amount, respectively, of which is
$300,000 or less.
(3) Administration.--In developing an application
under this subsection, the Secretary shall--
(A) consult with commercial and cooperative
lenders; and
(B) ensure that--
(i) the form can be completed
manually or electronically, at the
option of the lender;
(ii) the form minimizes the
documentation required to accompany the
form;
(iii) the cost of completing and
processing the form is minimal; and
(iv) the form can be completed and
processed in an expeditious manner.
Sec. 333B. Repealed by section 281(c) of Public Law 103-
354.
SEC. 333C. PROVISION OF INFORMATION TO BORROWERS.
* * * * * * *
Sec. 343. (a) As used in this title:
(1) The term ``farmer'' includes a person who is
engaged in, or who, with assistance afforded under this
title, intends to engage in, fish farming.
(2) The term ``farming'' shall be deemed to include
fish farming.
(3) The term ``owner-operator'' shall include in the
State of Hawaii the lessee-operator of real property in
any case in which the Secretary determines that such
real property cannot be acquired in fee simple by such
lessee-operator, that adequate security is provided for
the loan with respect to such real property for which
such lessee-operator applies under this title, and that
there is a reasonable probability of accomplishing the
objectives and repayment of such loan.
(4) The word ``insure'' as used in this title
includes guarantee, which means to guarantee the
payment of a loan originated, held, and serviced by a
private financial agency or other lender approved by
the Secretary.
(5) The term ``contract of insurance'' includes a
contract of guarantee.
(6) The terms ``United States'' and ``State'' shall
include each of the several States, the Commonwealth of
Puerto Rico, the Virgin Islands of the United States,
Guam, American Samoa, the Commonwealth of the Northern
Mariana Islands, and, to the extent the Secretary
determines it to be feasible and appropriate, the Trust
Territory of the Pacific Islands.
(7) The term ``joint operation'' means a joint
farming operation in which two or more farmers work
together sharing equally or unequally land, labor,
equipment, expenses, and income.
(8) The term ``beginning farmer or rancher'' means
such term as defined by the Secretary.
(9) The term ``direct loan'' means a loan made or
insured from funds in the account created by section
309.
(10) The term ``farmer program loan'' means a farm
ownership loan (FO) under section 303, operating loan
(OL) under section 312, soil and water loan (SW) under
section 304, emergency loan (EM) under section 321,
economic emergency loan (EE) under section 202 of the
Emergency Agricultural Credit Adjustment Act (title II
of Public Law 95-334), economic opportunity loan (EO)
under the Economic Opportunity Act of 1961 (42 U.S.C.
2942), softwood timber loan (ST) under section 1254 of
the Food Security Act of 1985, or rural housing loan
for farm service buildings (RHF) under section 502 of
the Housing Act of 1949.
(11) The term ``qualified beginning farmer or
rancher'' means an applicant, regardless of whether the
applicant is participating in a program under section
310E--
(A) who is eligible for assistance under this
title;
(B) who has not operated a farm or ranch, or
who has operated a farm or ranch for not more
than 10 years;
(C) in the case of a cooperative,
corporation, partnership, or joint operation,
who has members, stockholders, partners, or
joint operators who are all related to one
another by blood or marriage;
(D)(i) in the case of an owner and operator
of a farm or ranch, who--
(I) in the case of a loan made to an
individual, individually or with the
immediate family of the applicant--
(aa) materially and
substantially participates in
the operation of the farm or
ranch; and
(bb) provides substantial
day-to-day labor and management
of the farm or ranch,
consistent with the practices in
the State or county in which the
farm or ranch is located; or
(II)(aa) in the case of a loan made
to a cooperative, corporation,
partnership, or joint operation, has
members, stockholders, partners, or
joint operators, materially and
substantially participate in the
operation of the farm or ranch; and
(bb) in the case of a loan made to a
corporation, has stockholders, all of
whom are qualified beginning farmers or
ranchers; and
(ii) in the case of an applicant seeking to
own and operate a farm or ranch, who--
(I) in the case of a loan made to an
individual, individually or with the
immediate family of the applicant,
will--
(aa) materially and
substantially participate in
the operation of the farm or
ranch; and
(bb) provide substantial day-
to-day labor and management of
the farm or ranch, consistent
with the practices in the State
or county in which the farm or
ranch is located; or
(II)(aa) in the case of a loan made
to a cooperative, corporation,
partnership, or joint operation, will
have members, stockholders, partners,
or joint operators, materially and
substantially participate in the
operation of the farm or ranch; and
(bb) in the case of a loan made to a
corporation, has stockholders, all of
whom are qualified beginning farmers or
ranchers;
(E) who agrees to participate in such loan
assessment, borrower training, and financial
management programs as the Secretary may
require;
(F) who does not own land or who, directly or
through interests in family farm corporations,
owns land, the aggregate acreage of which does
not exceed 25 percent of the median acreage of
the farms or ranches, as the case may be, in
the county in which the farm or ranch
operations of the applicant are located, as
reported in the most recent census of
agriculture taken under section 142 of title
13, United States Code, except that this
subparagraph shall not apply to a loan made or
guaranteed under subtitle B; and
(G) who demonstrates that the available
resources of the applicant and spouse (if any)
of the applicant are not sufficient to enable
the applicant to continue farming or ranching
on a viable scale.
(12) Debt forgiveness.--
(A) In general.--Except as provided in
subparagraph (B), the term ``debt forgiveness''
means reducing or terminating a farmer program
loan made or guaranteed under this title, in a
manner that results in a loss to the Secretary,
through--
(i) writing down or writing off a
loan under section 353;
(ii) compromising, adjusting,
reducing, or charging-off a debt or
claim under section 331;
(iii) paying a loss on a guaranteed
loan under section 357; or
(iv) discharging a debt as a result
of bankruptcy.
(B) Loan restructuring.--The term ``debt
forgiveness'' does not include consolidation,
rescheduling, reamortization, or deferral.
(13) Rural and rural area.--
(A) In general.--Except as otherwise provided
in this paragraph, the terms ``rural'' and
``rural area'' mean a city, town, or
unincorporated area that has a population of
50,000 inhabitants or less, other than an
urbanized area immediately adjacent to a city,
town, or unincorporated area that has a
population in excess of 50,000 inhabitants.
(B) Water and waste disposal grants and
direct and guaranteed loans.--For the purpose
of water and waste disposal grants and direct
and guaranteed loans provided under paragraphs
(1) and (2) of section 306(a), the terms
``rural'' and ``rural area'' mean a city, town,
or unincorporated area that has a population of
no more than 10,000 inhabitants.
(C) Community facility loans and grants.--For
the purpose of community facility direct and
guaranteed loans and grants under paragraphs
(1), (19), (20), and (21) of section 306(a),
the terms ``rural'' and ``rural area'' mean a
city, town, or unincorporated area that has a
population of no more than 50,000 inhabitants.
(D) Business and industry direct and
guaranteed loans.--For the purpose of business
and industry direct and guaranteed loans under
section 310B(a)(1), the terms ``rural'' and
``rural area'' mean any area other than a city
or town that has a population of greater than
50,000 inhabitants and the immediately adjacent
urbanized area of such city or town.
(E) Multijurisdictional regional planning
organizations; national rural development
partnership.--In sections 306(a)(23) and 377,
the term ``rural area'' means--
(i) all the territory of a State that
is not within the boundary of any
standard metropolitan statistical area;
and
(ii) all territory within any
standard metropolitan statistical area
within a census tract having a
population density of less than 20 persons
per square mile, as determined by the
Secretary according to the most recent
census of the United States as of any date.
(F) Rural entrepreneurs and microenterprise
assistance program; National rural cooperative
and business equity fund.--In section 378 and
subtitle G, the term ``rural area'' means an
area that is located--
(i) outside a standard metropolitan
statistical area; or
(ii) within a community that has a
population of 50,000 inhabitants or
less.
* * * * * * *
(b) As used in sections 307(e), 331D, 335 (e) and (f),
338(b), 352 (b) and (c), 353, and 357:
(1) The term ``borrower'' means any farm borrower who
has outstanding obligations to the Secretary under any
farmer program loan, without regard to whether the loan
has been accelerated, but does not include any farm
borrower all of whose loans and accounts have been
foreclosed on or liquidated, voluntarily or otherwise.
* * * * * * *
SEC. 377. NATIONAL RURAL DEVELOPMENT PARTNERSHIP.
(a) Definitions.--In this section:
(1) Agency with rural responsibilities.--The term
``agency with rural responsibilities'' means any
executive agency (as defined in section 105 of title 5,
United States Code) that--
(A) implements Federal law targeted at rural
areas, including--
(i) the Act of April 24, 1950
(commonly known as the ``Granger-Thye
Act'') (64 Stat. 82, chapter 9);
(ii) the Intergovernmental
Cooperation Act of 1968 (82 Stat.
1098);
(iii) section 41742 of title 49,
United States Code;
(iv) the Rural Development Act of
1972 (86 Stat. 657);
(v) the Rural Development Policy Act
of 1980 (94 Stat. 1171);
(vi) the Rural Electrification Act of
1936 (7 U.S.C. 901 et seq.);
(vii) amendments made to section 334
of the Public Health Service Act (42
U.S.C. 254g) by the Rural Health
Clinics Act of 1983 (97 Stat. 1345);
and
(viii) the Rural Housing Amendments
of 1983 (97 Stat. 1240) and the
amendments made by the Rural Housing
Amendments of 1983 to title V of the
Housing Act of 1949 (42 U.S.C. 1471 et
seq.); or
(B) administers a program that has a
significant impact on rural areas, including--
(i) the Appalachian Regional
Commission;
(ii) the Department of Agriculture;
(iii) the Department of Commerce;
(iv) the Department of Defense;
(v) the Department of Education;
(vi) the Department of Energy;
(vii) the Department of Health and
Human Services;
(viii) the Department of Housing and
Urban Development;
(ix) the Department of the Interior;
(x) the Department of Justice;
(xi) the Department of Labor;
(xii) the Department of
Transportation;
(xiii) the Department of the
Treasury;
(xiv) the Department of Veterans
Affairs;
(xv) the Environmental Protection
Agency;
(xvi) the Federal Emergency
Management Administration;
(xvii) the Small Business
Administration;
(xviii) the Social Security
Administration;
(xix) the Federal Reserve System;
(xx) the United States Postal
Service;
(xxi) the Corporation for National
Service;
(xxii) the National Endowment for the
Arts and the National Endowment for the
Humanities; and
(xxiii) other agencies, commissions,
and corporations.
(2) Coordinating committee.--The term ``Coordinating
Committee'' means the National Rural Development
Coordinating Committee established by subsection (c).
(3) Partnership.--The term ``Partnership'' means the
National Rural Development Partnership continued by
subsection (b).
(4) State rural development council.--The term
``State rural development council'' means a State rural
development council that meets the requirements of
subsection (d).
(b) Partnership.--
(1) In general.--The Secretary shall continue the
National Rural Development Partnership composed of--
(A) the Coordinating Committee; and
(B) State rural development councils.
(2) Purposes.--The purposes of the Partnership are--
(A) to empower and build the capacity of
States and rural communities within States to
design unique responses to their own special
rural development needs, with local
determinations of progress and selection of
projects and activities;
(B) to encourage participants to be flexible
and innovative in establishing new partnerships
and trying fresh, new approaches to rural
development issues, with responses to rural
development that use different approaches to
fit different situations; and
(C) to encourage all partners in the
Partnership (Federal, State, local, and tribal
governments, the private sector, and nonprofit
organizations) to be fully engaged and share
equally in decisions.
(3) Governing panel.--
(A) In general.--A panel consisting of
representatives of the Coordinating Committee
and State rural development councils shall be
established to lead and coordinate the
strategic operation, policies, and practices of
the Partnership.
(B) Annual reports.--In conjunction with the
Coordinating Committee and State rural
development councils, the panel shall prepare
and submit to Congress an annual report on the
activities of the Partnership.
(4) Role of federal government.--The role of the
Federal Government in the Partnership shall be that of
a partner and facilitator, with Federal agencies
authorized--
(A) to cooperate with States to implement the
Partnership;
(B) to provide States with the technical and
administrative support necessary to plan and
implement tailored rural development strategies
to meet local needs;
(C) to ensure that the head of each agency
referred to in subsection (a)(1)(B) designates
a senior-level agency official to represent the
agency on the Coordinating Committee and
directs appropriate field staff to participate
fully with the State rural development council
within the jurisdiction of the field staff; and
(D) to enter into cooperative agreements
with, and to provide grants and other
assistance to State rural development councils.
(5) Role of private and nonprofit sector
organizations.--Private and nonprofit sector
organizations are encouraged--
(A) to act as full partners in the
Partnership and State rural development
councils; and
(B) to cooperate with participating
government organizations in developing
innovative approaches to the solution of rural
development problems.
(c) National Rural Development Coordinating Committee.--
(1) Establishment.--The Secretary shall establish a
National Rural Development Coordinating Committee.
(2) Composition.--The Coordinating Committee shall be
composed of--
(A) 1 representative of each agency with
rural responsibilities that elects to
participate in the Coordinating Committee; and
(B) representatives, approved by the
Secretary, of--
(i) national associations of State,
regional, local, and tribal governments
and intergovernmental and
multijurisdictional agencies and
organizations;
(ii) national public interest groups;
(iii) other national nonprofit
organizations that elect to participate
in the activities of the Coordinating
Committee; and
(iv) the private sector.
(3) Duties.--The Coordinating Committee shall--
(A) provide support for the work of the State
rural development councils;
(B) facilitate coordination among Federal
programs and activities, and with State, local,
tribal, and private programs and activities,
affecting rural development;
(C) enhance the effectiveness,
responsiveness, and delivery of Federal
programs in rural areas;
(D) gather and provide to Federal authorities
information and input for the development and
implementation of Federal programs impacting
rural economic and community development;
(E) notwithstanding any other provision of
law, review and comment on policies,
regulations, and proposed legislation that
affect or would affect rural areas;
(F) provide technical assistance to State
rural development councils for the
implementation of Federal programs;
(G) notwithstanding any other provision of
law, develop and facilitate strategies to
reduce or eliminate administrative and
regulatory impediments; and
(H) require each State receiving funds under
this section to submit an annual report on the
use of the funds by the State, including a
description of strategic plans, goals,
performance measures, and outcomes for the
State rural development council of the State.
(4) Election not to participate.--An agency with
rural responsibilities that elects not to participate
in the Partnership and the Coordinating Committee shall
submit to Congress a report that describes--
(A) how the programmatic responsibilities of
the Federal agency that target or have an
impact on rural areas are better achieved
without participation by the agency in the
Partnership; and
(B) a more effective means of partnership-
building and collaboration to achieve the
programmatic responsibilities of the agency.
(d) State Rural Development Councils.--
(1) Establishment.--Notwithstanding chapter 63 of
title 31, United States Code, each State may elect to
participate in the Partnership by entering into an
agreement with the Secretary to establish a State rural
development council.
(2) State diversity.--Each State rural development
council shall--
(A) have a nonpartisan membership that is
broad and representative of the economic,
social, and political diversity of the State;
and
(B) carry out programs and activities in a
manner that reflects the diversity of the
State.
(3) Duties.--A State rural development council
shall--
(A) facilitate collaboration among Federal,
State, local, and tribal governments and the
private and nonprofit sectors in the planning
and implementation of programs and policies
that target or have an impact on rural areas of
the State;
(B) enhance the effectiveness,
responsiveness, and delivery of Federal and
State programs in rural areas of the State;
(C) gather and provide to the Coordinating
Committee and other appropriate organizations
information on the condition of rural areas in
the State;
(D) monitor and report on policies and
programs that address, or fail to address, the
needs of the rural areas of the State;
(E) provide comments to the Coordinating
Committee and other appropriate organizations
on policies, regulations, and proposed
legislation that affect or would affect the
rural areas of the State;
(F) notwithstanding any other provision of
law, in conjunction with the Coordinating
Committee, facilitate the development of
strategies to reduce or eliminate conflicting
or duplicative administrative or regulatory
requirements of Federal, State, local, and
tribal governments;
(G) use grant or cooperative agreement funds
provided by the Partnership under an agreement
entered into under paragraph (1) to--
(i) retain an Executive Director and
such support staff as are necessary to
facilitate and implement the directives
of the State rural development council;
and
(ii) pay expenses associated with
carrying out subparagraphs (A) through
(F); and
(H)(i) provide to the Coordinating Committee
an annual plan with goals and performance
measures; and
(ii) submit to the Coordinating Committee an
annual report on the progress of the State
rural development council in meeting the goals
and measures.
(4) Authorities.--A State rural development council
may--
(A) solicit funds to supplement and match
funds provided under paragraph (3)(G); and
(B) engage in activities, in addition to
those specified in paragraph (3), appropriate
to accomplish the purposes for which the State
rural development council is established.
(5) Comments or recommendations.--A State rural
development council may provide comments and
recommendations to an agency with rural
responsibilities related to the activities of the State
rural development council within the State.
(6) Actions of state rural development council
members.--When carrying out a program or activity
authorized by a State rural development council or this
subtitle, a member of the council shall be regarded as
a full-time employee of the Federal Government for
purposes of chapter 171 of title 28, United States
Code, and the Federal Advisory Committee Act (5 U.S.C.
App.).
(7) Federal participation in state rural development
councils.--
(A) In general.--The State Director for Rural
Development of a State, other employees of the
Department of Agriculture, and employees of
other Federal agencies that elect to
participate in the Partnership shall fully
participate in the governance and operations of
State rural development councils on an equal
basis with other members of the State rural
development councils.
(B) Conflicts.--A Federal employee who
participates in a State rural development
council shall not participate in the making of
any council decision if the agency represented
by the Federal employee has any financial or
other interest in the outcome of the decision.
(C) Federal guidance.--The Office of
Government Ethics, in consultation with the
Attorney General, shall issue guidance to all
Federal employees that participate in State
rural development councils that describes
specific decisions that--
(i) would constitute a conflict of
interest for the Federal employee; and
(ii) from which the Federal employee
must recuse himself or herself.
(e) Administrative Support of the Partnership.--
(1) Detail of employees.--
(A) In general.--In order to provide
experience in intergovernmental collaboration,
the head of an agency with rural
responsibilities that elects to participate in
the Partnership may, and is encouraged to,
detail an employee of the agency with rural
responsibilities to the Partnership without
reimbursement for a period of up to 12 months.
(B) Civil service status.--The detail shall
be without interruption or loss of civil
service status or privilege.
(2) Additional support.--The Secretary shall provide
for any additional support staff to the Partnership as
the Secretary determines to be necessary to carry out
the duties of the Partnership.
(f) Funding.--
(1) Authorization of appropriations.--
(A) In general.--There are authorized to be
appropriated such sums as are necessary to
carry out this section.
(B) Amount of financial assistance.--In
providing financial assistance to State rural
development councils, the Secretary and heads
of other Federal agencies shall provide
assistance that, to the maximum extent
practicable, is--
(i) uniform in amount; and
(ii) targeted to newly created State
rural development councils.
(C) Federal share.--The Secretary shall
develop a plan to decrease, over time, the
Federal share of the cost of the core
operations of State rural development councils.
(2) Federal agencies.--
(A) In general.--Notwithstanding any other
provision of law limiting the ability of an
agency to provide funds to the Partnership with
other agencies, in order to carry out the
purposes described in subsection (b)(2), the
Partnership shall be eligible to receive
grants, gifts, contributions, or technical
assistance from, or enter into contracts with,
any Federal agency.
(B) Assistance.--Federal agencies are
encouraged to use funds made available for
programs that target or have an impact on rural
areas to provide assistance to, and enter into
contracts with, the Partnership, as described
in subparagraph (A).
(3) Contributions.--The Partnership may accept
private contributions.
(4) Federal financial support for state rural
development councils.--Notwithstanding any other
provision of law, a Federal agency may use funds made
available under paragraph (1) or (2) to enter into a
cooperative agreement, contract, or other agreement
with a State rural development council to support the
core operations of the State rural development council,
regardless of the legal form of organization of the
State rural development council.
(g) Matching Requirements for State Rural Development
Councils.--
(1) In general.--Except as provided in paragraph (2),
a State rural development council shall provide
matching funds, or in-kind goods or services, to
support the activities of the State rural development
council in an amount that is not less than 33 percent
of the amount of Federal funds received under an
agreement under subsection (d)(1).
(2) Exceptions to matching requirement for certain
federal funds.--Paragraph (1) shall not apply to funds,
grants, funds provided under contracts or cooperative
agreements, gifts, contributions, or technical
assistance received by a State rural development
council from a Federal agency that are used--
(A) to support 1 or more specific program or
project activities; or
(B) to reimburse the State rural development
council for services provided to the Federal
agency providing the funds, grants, funds
provided under contracts or cooperative
agreements, gifts, contributions, or technical
assistance.
(h) Termination.--The authority provided under this section
shall terminate on the date that is 5 years after the date of
enactment of this section.
SEC. 378. RURAL ENTREPRENEURS AND MICROENTERPRISE ASSISTANCE PROGRAM.
(a) Definitions.--In this section:
(1) Economically disadvantaged microentrepreneur.--
The term ``economically disadvantaged
microentrepreneur'' means an owner, majority owner, or
developer of a microenterprise that has the ability to
compete in the private sector but has been impaired due
to diminished capital and credit opportunities, as
compared to other microentrepreneurs in the industry.
(2) Indian tribe.--The term ``Indian tribe'' has the
meaning given the term in section 4 of the Indian Self-
Determination and Education Assistance Act (25 U.S.C.
450b).
(3) Intermediary.--The term ``intermediary'' means a
private, nonprofit entity that provides assistance--
(A) to a microenterprise development
organization; or
(B) for a microenterprise development
program.
(4) Low-income individual.--The term ``low-income
individual'' means an individual with an income
(adjusted for family size) of not more than the greater
of--
(A) 80 percent of median income of an area;
or
(B) 80 percent of the statewide
nonmetropolitan area median income.
(5) Microcredit.--The term ``microcredit'' means a
business loan or loan guarantee of not more than
$35,000 provided to a rural entrepreneur.
(6) Microenterprise.--The term ``microenterprise''
means a sole proprietorship, joint enterprise, limited
liability company, partnership, corporation, or
cooperative that--
(A) has 5 or fewer employees; and
(B) is unable to obtain sufficient credit,
equity, or banking services elsewhere, as
determined by the Secretary.
(7) Microenterprise development organization.--
(A) In general.--The term ``microenterprise
development organization'' means a nonprofit
entity that provides training and technical
assistance to rural entrepreneurs and access to
capital or another service described in
subsection (c) to rural entrepreneurs.
(B) Inclusions.--The term ``microenterprise
development organization'' includes an
organization described in subparagraph (A) with
a demonstrated record of delivering services to
economically disadvantaged microentrepreneurs.
(8) Microenterprise development program.--The term
``microenterprise development organization'' means a
program administered by an organization serving a rural
area.
(9) Microentrepreneur.--The term
``microentrepreneur'' means the owner, operator, or
developer of a microenterprise.
(10) Program.--The term ``program'' means the rural
entrepreneur and microenterprise program established
under subsection (b)(1).
(11) Qualified organization.--The term ``qualified
organization'' means--
(A) a microenterprise development
organization or microenterprise development
program that has a demonstrated record of
delivering microenterprise services to rural
entrepreneurs, as demonstrated by the
development of an effective plan of action and
the possession of necessary resources to
deliver microenterprise services to rural
entrepreneurs effectively, as determined by the
Secretary;
(B) an intermediary that has a demonstrated
record of delivery assistance to
microenterprise development organizations or
microenterprise development programs;
(C) a microenterprise development
organization or microenterprise development
program that--
(i) serves rural entrepreneurs; and
(ii) enters into an agreement with a
local community, in conjunction with a
State or local government or Indian
tribe, to provide assistance described
in subsection (c);
(D) an Indian tribe, the tribal government of
which certifies to the Secretary that no
microenterprise development organization or
microenterprise development program exists
under the jurisdiction of the Indian tribe; or
(E) a group of 2 or more organizations or
Indian tribes described in subparagraph (A),
(B), (C), or (D) that agree to act jointly as a
qualified organization under this section.
(12) Rural capacity building service.--The term
``rural capacity building service'' means a service
provided to an organization that--
(A) is, or is in the process of becoming, a
microenterprise development organization or
microenterprise development program; and
(B) serves rural areas for the purpose of
enhancing the ability of the organization to
provide training, technical assistance, and
other related services to rural entrepreneurs.
(13) Rural entrepreneur.--The term ``rural
entrepreneur'' means a microentrepreneur, or
prospective microentrepreneur--
(A) the principal place of business of which
is in a rural area; and
(B) that is unable to obtain sufficient
training, technical assistance, or microcredit
elsewhere, as determined by the Secretary.
(14) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture, acting through the Rural
Business-Cooperative Service.
(15) Training and technical assistance.--
(A) In general.--The term ``training and
technical assistance'' means assistance
provided to rural entrepreneurs to develop the
skills the rural entrepreneurs need to plan,
market, and manage their own business.
(B) Inclusions.--The term ``training and
technical assistance'' includes assistance
provided for the purpose of--
(i) enhancing business planning,
marketing, management, or financial
management skills; and
(ii) obtaining microcredit.
(16) Tribal government.--The term ``tribal
government'' means the governing body of an Indian
tribe.
(b) Establishment.--
(1) In general.--From amounts made available under
subsection (h), the Secretary shall establish a rural
entrepreneur and microenterprise program.
(2) Purpose.--The purpose of the program shall be to
provide low and moderate income individuals with--
(A) the skills necessary to establish new
small businesses in rural areas; and
(B) continuing technical assistance as the
individuals begin operating the small
businesses.
(c) Assistance.--
(1) In general.--The Secretary may make a grant under
this section to a qualified organization to--
(A) provide training, technical assistance,
or microcredit to a rural entrepreneur;
(B) provide training, operational support, or
a rural capacity building service to a
qualified organization to assist the qualified
organization in developing microenterprise
training, technical assistance, and other
related services;
(C) assist in researching and developing the
best practices in delivering training,
technical assistance, and microcredit to rural
entrepreneurs; and
(D) to carry out such other projects and
activities as the Secretary determines are
consistent with the purposes of this section.
(2) Allocation.--
(A) In general.--Subject to subparagraphs (B)
and (C), of the amount of funds made available
for a fiscal year to make grants under this
section, the Secretary shall ensure that--
(i) not less than 75 percent of funds
are used to carry out activities
described in paragraph (1)(A); and
(ii) not more than 25 percent of the
funds are used to carry out activities
described in subparagraphs (B) through
(D) of paragraph (1).
(B) Limitation on grant amount.--No single
qualified organization may receive more than 10
percent of the total funds that are made
available for a fiscal year to carry out this
section.
(C) Administrative expenses.--Not more than
15 percent of assistance received by a
qualified organization for a fiscal year under
this section may be used for administrative
expenses.
(d) Subgrants.--Subject to such regulations as the
Secretary may promulgate, a qualified organization that
receives a grant under this section may use the grant to
provide assistance to other qualified organizations, such as
small or emerging qualified organizations.
(e) Low-Income Individuals.--The Secretary shall ensure
that not less than 50 percent of the grants made under this
section is used to benefit low-income individuals identified by
the Secretary, including individuals residing on Indian
reservations.
(f) Diversity.--In making grants under this section, the
Secretary shall ensure, to the maximum extent practicable, that
grant recipients include qualified organizations--
(1) of varying sizes; and
(2) that serve racially and ethnically diverse
populations.
(g) Cost Sharing.--
(1) Federal share.--The Federal share of the cost of
a project carried out using funds from a grant under
this section shall be 75 percent.
(2) Form of non-federal share.--The non-Federal share
of the cost of a project described in paragraph (1) may
be provided--
(A) in cash (including through fees, grants
(including community development block grants),
and gifts); or
(B) in kind.
(h) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this Act, and on October 1, 2002,
and each October 1 thereafter through October 1, 2005,
out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary of Agriculture to carry out
this section $10,000,000, to remain available until
expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
SEC. 379. INTERAGENCY COORDINATING COMMITTEE FOR RURAL SENIORS.
(a) In General.--The Secretary shall establish an
interagency coordinating committee (referred to in this section
as the ``Committee'') to examine the special problems of rural
seniors.
(b) Membership.--The Committee shall be comprised of--
(1) the Undersecretary of Agriculture for Rural
Development, who shall serve as chairperson of the
Committee;
(2) 2 representatives of the Secretary of Health and
Human Services, of whom--
(A) 1 shall have expertise in the field of
health care; and
(B) 1 shall have expertise in the field of
programs under the Older Americans Act of 1965
(42 U.S.C. 3001 et seq.);
(3) 1 representative of the Secretary of Housing and
Urban Development;
(4) 1 representative of the Secretary of
Transportation; and
(5) representatives of such other Federal agencies as
the Secretary may designate.
(c) Duties.--The Committee shall--
(1) study health care, transportation, technology,
housing, accessibility, and other areas of need of
rural seniors;
(2) identify successful examples of senior care
programs in rural communities that could serve as
models for other rural communities; and
(3) not later than 1 year after the date of enactment
of this section, submit to the Secretary, the Committee
on Agriculture of the House of Representatives, and the
Committee on Agriculture, Nutrition, and Forestry of
the Senate recommendations for legislative and
administrative action.
(d) Funding.--Funds available to any Federal agency may be
used to carry out interagency activities under this section.
SEC. 379A. GRANTS FOR PROGRAMS FOR RURAL SENIORS.
(a) In General.--The Secretary shall make grants to
nonprofit organizations (including cooperatives) to pay the
Federal share of the cost of programs that--
(1) provide facilities, equipment, and technology for
seniors in a rural area; and
(2) may be replicated in other rural areas.
(b) Federal Share.--The Federal share of a grant under this
section shall be not more than 20 percent of the cost of a
program described in subsection (a).
(c) Leveraging.--In selecting programs to receive grants
under section, the Secretary shall give priority to proposals
that leverage resources to meet multiple rural community goals.
(d) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $25,000,000 for
each of fiscal years 2003 through 2006.
SEC. 379B. RURAL TELEWORK.
(a) Definitions.--In this section:
(1) Eligible organization.--The term ``eligible
organization'' means a nonprofit entity, an educational
institution, an Indian tribe (as defined in section 4
of the Indian Self-Determination and Education
Assistance Act (25 U.S.C. 450b)), or any other
organization that meets the requirements of this
section and such other requirements as are established
by the Secretary.
(2) Institute.--The term ``institute'' means a
regional rural telework institute established using a
grant under this subsection (b).
(3) Telework.--The term ``telework'' means the use of
telecommunications to perform work functions at a rural
work center located outside the place of business of an
employer.
(b) Rural Telework Institute.--
(1) In general.--The Secretary shall make a grant to
an eligible organization to pay the Federal share of
the cost of establishing and operating a national rural
telework institute to carry out projects described in
paragraph (4).
(2) Eligible organizations.--The Secretary shall
establish criteria that an organization shall meet to
be eligible to receive a grant under this subsection.
(3) Deadline for initial grant.--Not later than 1
year after the date on which funds are first made
available to carry out this subsection, the Secretary
shall make the initial grant under this subsection.
(4) Projects.--The institute shall use grant funds
obtained under this subsection to carry out a 5-year
project--
(A) to serve as a clearinghouse for telework
research and development;
(B) to conduct outreach to rural communities
and rural workers;
(C) to develop and share best practices in
rural telework throughout the United States;
(D) to develop innovative, market-driven
telework projects and joint ventures with the
private sector that employ workers in rural
areas in jobs that promote economic self-
sufficiency;
(E) to share information about the design and
implementation of telework arrangements;
(F) to support private sector businesses that
are transitioning to telework;
(G) to support and assist telework projects
and individuals at the State and local level;
and
(H) to perform such other functions as the
Secretary considers appropriate.
(5) Non-federal share.--
(A) In general.--As a condition of receiving
a grant under this subsection, an eligible
organization shall agree to obtain, after the
application of the eligible organization has
been approved and notice of award has been
issued, contributions from non-Federal sources
that are equal to--
(i) during each of the first, second,
and third years of a project, 50
percent of the amount of the grant; and
(ii) during each of the fourth and
fifth years of the project, 100 percent
of the amount of the grant.
(B) Indian tribes.--Notwithstanding
subparagraph (A), an Indian tribe may use
Federal funds made available to the tribe for
self-governance to pay the non-Federal
contributions required under subparagraph (A).
(C) Form.--The non-Federal contributions
required under subparagraph (A) may be in the
form of in-kind contributions, including office
equipment, office space, and services.
(c) Telework Grants.--
(1) In general.--Subject to paragraphs (2) through
(5), the Secretary shall make grants to eligible
entities to pay the Federal share of the cost of--
(A) obtaining equipment and facilities to
establish or expand telework locations in rural
areas; and
(B) operating telework locations in rural
areas.
(2) Eligible organizations.--To be eligible to
receive a grant under this subsection, an eligible
entity shall--
(A) be a nonprofit organization or
educational institution in a rural area; and
(B) submit to, and receive the approval of,
the Secretary of an application for the grant
that demonstrates that the eligible entity has
adequate resources and capabilities to
establish or expand a telework location in a
rural area.
(3) Non-federal share.--
(A) In general.--As a condition of receiving
a grant under this subsection, an eligible
organization shall agree to obtain, after the
application of the eligible organization has
been approved and notice of award has been
issued, contributions from non-Federal sources
that are equal to 50 percent of the amount of
the grant.
(B) Indian tribes.--Notwithstanding
subparagraph (A), an Indian tribe may use
Federal funds made available to the tribe for
self-governance to pay the non-Federal
contributions required under subparagraph (A).
(C) Sources.--The non-Federal contributions
required under subparagraph (A)--
(i) may be in the form of in-kind
contributions, including office
equipment, office space, and services;
and
(ii) may not be made from funds made
available for community development
block grants under title I of the
Housing and Community Development Act
of 1974 (42 U.S.C. 5301 et seq.).
(4) Duration.--The Secretary may not provide a grant
under this subsection to establish, expand, or operate
a telework location in a rural area after the date that
is 2 years after the establishment of the telework
location.
(5) Maximum amount of grant.--The amount of a grant
provided to an eligible entity under this subsection
shall not exceed $500,000.
(d) Applicability of Certain Federal Law.--An entity that
receives funds under this section shall be subject to the
provisions of Federal law (including regulations), administered
by the Secretary of Labor or the Equal Employment Opportunity
Commission, that govern the responsibilities of employers to
employees.
(e) Regulations.--Not later than 180 days after the date of
enactment of this section, the Secretary shall promulgate
regulations to carry out this section.
(f) Authorization of Appropriation.--There is authorized to
be appropriated to carry out this section $30,000,000 for each
of fiscal years 2002 through 2006, of which $5,000,000 shall be
provided to establish an institute under subsection (b).
SEC. 379C. HISTORIC BARN PRESERVATION.
(a) Definitions.--In this section:
(1) Barn.--The term ``barn'' means a building (other
than a dwelling) on a farm, ranch, or other
agricultural operation for--
(A) housing animals;
(B) storing or processing crops;
(C) storing and maintaining agricultural
equipment; or
(D) serving an essential or useful purpose
related to agriculture on the adjacent land.
(2) Eligible applicant.--The term ``eligible
applicant'' means--
(A) a State department of agriculture (or a
designee);
(B) a national or State nonprofit
organization that--
(i) is exempt from tax under section
501(c)(3) of the Internal Revenue Code
of 1986; and
(ii) has experience or expertise, as
determined by the Secretary, in the
identification, evaluation,
rehabilitation, preservation, or
protection of historic barns; and
(C) a State historic preservation office.
(3) Historic barn.--The term ``historic barn'' means
a barn that--
(A) is at least 50 years old;
(B) retains sufficient integrity of design,
materials, and construction to clearly identify
the barn as an agricultural building; and
(C) meets the criteria for listing on
National, State, or local registers or
inventories of historic structures.
(4) Secretary.--The term ``Secretary'' means the
Secretary, acting through the Undersecretary of Rural
Development.
(b) Program.--The Secretary shall establish a historic barn
preservation program--
(1) to assist States in developing a listing of
historic barns;
(2) to collect and disseminate information on
historic barns;
(3) to foster educational programs relating to the
history, construction techniques, rehabilitation, and
contribution to society of historic barns; and
(4) to sponsor and conduct research on--
(A) the history of barns; and
(B) best practices to protect and
rehabilitate historic barns from the effects of
decay, fire, arson, and natural disasters.
(c) Grants.--
(1) In general.--The Secretary may make grants to, or
enter into contracts or cooperative agreements with,
eligible applicants to carry out an eligible project
under paragraph (2).
(2) Eligible projects.--A grant under this subsection
may be made to an eligible entity for a project--
(A) to rehabilitate or repair a historic
barn;
(B) to preserve a historic barn through--
(i) the installation of a fire
protection system, including
fireproofing or fire detection system
and sprinklers; and
(ii) the installation of a system to
prevent vandalism; and
(C) to identify, document, and conduct
research on a historic barn to develop and
evaluate appropriate techniques or best
practices for protecting historic barns.
(3) Requirements.--An eligible applicant that
receives a grant for a project under this subsection
shall comply with any standards established by the
Secretary of the Interior for historic preservation
projects.
(d) Funding.--There is authorized to be appropriated to
carry out this section, $25,000,000 for the period of fiscal
years 2002 through 2006, to remain available until expended.
SEC. 379D. GRANTS FOR EMERGENCY WEATHER RADIO TRANSMITTERS.
(a) In General.--The Secretary, acting through the
Administrator of the Rural Utilities Service, may make grants
to public and nonprofit entities for the Federal share of the
cost of acquiring radio transmitters to increase coverage of
rural areas by the emergency weather radio broadcast system of
the National Oceanic and Atmospheric Administration.
(b) Eligibility.--To be eligible for a grant under this
section, an applicant shall provide to the Secretary--
(1) a binding commitment from a tower owner to place
the transmitter on a tower; and
(2) a description of how the tower placement will
increase coverage of a rural area by the emergency
weather radio broadcast system of the National Oceanic
and Atmospheric Administration.
(c) Federal Share.--A grant provided under this section
shall be not more than 75 percent of the cost of acquiring a
radio transmitter described in subsection (a).
(d) Authorization.--There is authorized to be appropriated
to carry out this section $2,000,000 for each of fiscal years
2002 through 2006.
SEC. 379E. BIOENERGY AND BIOCHEMICAL PROJECTS.
In carrying out rural development loan, loan guarantee, and
grant programs under this title, the Secretary shall provide a
priority for bioenergy and biochemical projects.''.
Subtitle E--Rural Community Advancement Program
SEC. 381A. DEFINITIONS.
In this subtitle:
[(1) Rural and rural area.--The terms ``rural'' and
``rural area'' mean, subject to section 306(a)(7), a
city, town, or unincorporated area that has a
population of 50,000 inhabitants or less, other than an
urbanized area immediately adjacent to a city, town, or
unincorporated area that has a population in excess of
50,000 inhabitants.]
[(2)] (1) State.--The term ``State'' means each of
the 50 States, the District of Columbia, the
Commonwealth of Puerto Rico, Guam, the Virgin Islands
of the United States, American Samoa, the Commonwealth
of the Northern Mariana Islands, the Trust Territory of
the Pacific Islands, and the Federated States of
Micronesia.
[(3)] (2) State director.--The term ``State
director'' means, with respect to a State, the Director
of the Rural Economic and Community Development State
Office.
SEC. 381B. ESTABLISHMENT.
The Secretary shall establish a rural community advancement
program to provide grants, loans, loan guarantees, and other
assistance to meet the rural development needs of local
communities in States and federally recognized Indian tribes.
* * * * * * *
SEC. 382M. AUTHORIZATION OF APPROPRIATIONS.
(a) In General.--There is authorized to be appropriated to
the Authority to carry out this subtitle $30,000,000 for each
of fiscal years 2001 through [2002] 2006, to remain available
until expended.
(b) Administrative Expenses.--Not more than 5 percent of
the amount appropriated under subsection (a) for a fiscal year
shall be used for administrative expenses of the Authority.
SEC. 382N. TERMINATION OF AUTHORITY.
This subtitle and the authority provided under this
subtitle expire on October 1, [2002] 2006.
Subtitle G--National Rural Cooperative and Business Equity Fund
SEC. 383A. SHORT TITLE.
This subtitle may be cited as the `National Rural
Cooperative and Business Equity Fund Act'.
SEC. 383B. PURPOSE.
The purpose of this subtitle is to revitalize rural
communities and enhance farm income through sustainable rural
business development by providing Federal funds and credit
enhancements to a private equity fund in order to encourage
investments by institutional and noninstitutional investors for
the benefit of rural America.
SEC. 383C. DEFINITIONS.
In this subtitle:
(1) Authorized private investor.--The term
``authorized private investor'' means an individual,
legal entity, or affiliate or subsidiary of an
individual or legal entity that--
(A) is eligible to receive a loan guarantee
under this title;
(B) is eligible to receive a loan guarantee
under the Rural Electrification Act of 1936 (7
U.S.C. 901 et seq.);
(C) is created under the National Consumer
Cooperative Bank Act (12 U.S.C. 3011 et seq.);
(D) is an insured depository institution
subject to section 383E(b)(2);
(E) is a Farm Credit System institution
described in section 1.2(a) of the Farm Credit
Act of 1971 (12 U.S.C. 2002(a)); or
(F) is determined by the Board to be an
appropriate investor in the Fund.
(2) Board.--The term ``Board'' means the board of
directors of the Fund established under section 383G.
(3) Fund.--The term ``Fund'' means the National Rural
Cooperative and Business Equity Fund established under
section 383D.
(4) Group of similar authorized private investors.--
The term ``group of similar investors'' means any 1 of
the following:
(A) Insured depository institutions with
total assets of more than $250,000,000.
(B) Insured depository institutions with
total assets equal to or less than
$250,000,000.
(C) Farm Credit System institutions described
in section 1.2(a) of the Farm Credit Act of
1971 (12 U.S.C. 2002(a)).
(D) Cooperative financial institutions (other
than Farm Credit System institutions).
(E) Private investors, other than those
described in subparagraphs (A) through (D),
authorized by the Secretary.
(F) Other nonprofit organizations, including
credit unions.
(5) Insured depository institution.--The term
``insured depository institution'' means any bank or
savings association the deposits of which are insured
under the Federal Deposit Insurance Act (12 U.S.C. 1811
et seq.).
(6) Rural business.--The term ``rural business''
means a rural cooperative, a value-added agricultural
enterprise, or any other business located or locating
in a rural area.
SEC. 383D. ESTABLISHMENT.
(a) Authority.--
(1) In general.--On certification by the Secretary
that, to the maximum extent practicable, the parties
proposing to establish a fund provide a broad
representation of all of the groups of similar
authorized private investors described in subparagraphs
(A) through (F) of section 383C(4), the parties may
establish a non-Federal entity under State law to
purchase shares of, and manage a fund to be known as
the ``National Rural Cooperative and Business Equity
Fund'' to generate and provide equity capital to rural
businesses.
(2) Ownership.--
(A) In general.--To the maximum extent
practicable, equity ownership of the Fund shall
be distributed among authorized private
investors representing all of the groups of
similar authorized private investors described
in subparagraphs (A) through (F) of section
383C(4).
(B) Exclusion of groups.--No group of
authorized private investors shall be excluded
from equity ownership of the Fund during any
period during which the Fund is in existence if
an authorized private investor representative
of the group is able and willing to invest in
the Fund.
(b) Purposes.--The purposes of the Fund shall be--
(1) to strengthen the economy of rural areas;
(2) to further sustainable rural business
development;
(3) to encourage--
(A) start-up rural businesses;
(B) increased opportunities for small and
minority-owned rural businesses; and
(C) the formation of new rural businesses;
(4) to enhance rural employment opportunities;
(5) to provide equity capital to rural businesses,
many of which have difficulty obtaining equity capital;
and
(6) to leverage non-Federal funds for rural
businesses.
(c) Articles of Incorporation and Bylaws.--The articles of
incorporation and bylaws of the Fund shall set forth purposes
of the Fund that are consistent with the purposes described in
subsection (b).
SEC. 383E. INVESTMENT IN THE FUND.
(a) In General.--Of the funds made available under section
383H, the Secretary shall--
(1) subject to subsection (b)(1), make available to
the Fund $150,000,000;
(2) subject to subsection (c), guarantee 50 percent
of each investment made by an authorized private
investor in the Fund; and
(3) subject to subsection (d), guarantee the
repayment of principal of, and accrued interest on,
debentures issued by the Fund to authorized private
investors.
(b) Private Investment.--
(1) Matching requirement.--Under subsection (a)(1),
the Secretary shall make an amount available to the
Fund only after an equal amount has been invested in
the Fund by authorized private investors in accordance
with this subtitle and the terms and conditions set
forth in the bylaws of the Fund.
(2) Insured depository institutions.--
(A) In general.--Subject to subparagraphs (B)
and (C)--
(i) an insured depository institution
may be an authorized private investor
in the Fund; and
(ii) an investment in the Fund may be
considered to be part of the record of
an institution in meeting the credit
needs of the community in which the
institution is located under any
applicable Federal law.
(B) Investment limit.--The total investment
in the Fund of an insured depository
institution shall not exceed 5 percent of the
capital and surplus of the institution.
(C) Regulatory authority.--An appropriate
Federal banking agency may, by regulation or
order, impose on any insured depository
institution investing in the Fund, any
safeguard, limitation, or condition (including
an investment limit that is lower than the
investment limit under subparagraph (B)) that
the Federal banking agency considers to be
appropriate to ensure that the institution
operates--
(i) in a financially sound manner;
and
(ii) in compliance with all
applicable law.
(c) Guarantee of Private Investments.--
(1) In general.--The Secretary shall guarantee, under
terms and conditions determined by the Secretary, 50
percent of any loss of the principal of an investment
made in the Fund by an authorized private investor.
(2) Maximum total guarantee.--The aggregate potential
liability of the Secretary with respect to all
guarantees under paragraph (1) shall not apply to more
than $300,000,000 in private investments in the Fund.
(3) Redemption of guarantee.--
(A) Date.--An authorized private investor in
the Fund may redeem a guarantee under paragraph
(1), with respect to the total investments in
the Fund and the total losses of the authorized
private investor as of the date of redemption--
(i) on the date that is 5 years after
the date of the initial investment by
the authorized private investor; or
(ii) annually thereafter.
(B) Effect of redemption.--On redemption of a
guarantee under subparagraph (A)--
(i) the shares in the Fund of the
authorized private investor shall be
redeemed; and
(ii) the authorized private investor
shall be prohibited from making any
future investment in the Fund.
(d) Debt Securities.--
(1) In general.--The Fund may, at the discretion of
the Board, generate additional capital through--
(A) the issuance of debt securities; and
(B) other means determined to be appropriate
by the Board.
(2) Guarantee of debt by secretary.--
(A) In general.--The Secretary shall
guarantee 100 percent of the principal of, and
accrued interest on, debentures issued by the
Fund that are approved by the Secretary.
(B) Maximum debt guaranteed by secretary.--
The outstanding value of debentures issued by
the Fund and guaranteed by the Secretary shall
not exceed the lesser of--
(i) the amount equal to twice the
value of the assets held by the Fund;
or
(ii) $500,000,000.
(C) Recapture of guarantee payments.--If the
Secretary makes a payment on a debt security
issued by the Fund as a result of a guarantee
of the Secretary under this paragraph, the
Secretary shall have priority over other
creditors for repayment of the debt security.
(3) Authorized private investors.--An authorized
private investor may purchase debt securities issued by
the Fund.
SEC. 383F. INVESTMENTS AND OTHER ACTIVITIES OF THE FUND.
(a) Investments.--
(1) In general.--
(A) Types.--Subject to subparagraphs (B) and
(C), the Fund may--
(i) make equity investments in a
rural business that meets--
(I) the requirements of
paragraph (6); and
(II) such other requirements
as the Board may establish; and
(ii) extend credit to the rural
business in--
(I) the form of mezzanine
debt or subordinated debt; or
(II) any other form of quasi-
equity.
(B) Limitations on investments.--
(i) Total investments by a single
rural business.--Subject to clause
(ii), investment by the Fund in a
single rural business shall not exceed
the greater of--
(I) an amount equal to 7
percent of the capital of the
Fund; or
(II) $2,000,000.
(ii) Waiver.--The Secretary may waive
the limitation in clause (i) in any
case in which an investment exceeding
the limits specified in clause (i) is
necessary to preserve prior investments
in the rural business.
(iii) Total nonequity investments.--
Except in the case of a project to
assist a rural cooperative, the total
amount of nonequity investments
described in subparagraph (A)(ii) that
may be provided by the Fund shall not
exceed 20 percent of the total
investments of the Fund in the project.
(C) Limitation.--Notwithstanding subparagraph
(B), the amount of any investment by the Fund
in a rural business shall not exceed the
aggregate amount invested in like securities by
other private entities in that rural business.
(2) Procedures.--The Fund shall implement procedures
to ensure that--
(A) the financing arrangements of the Fund
meet the Fund's primary focus of providing
equity capital; and
(B) the Fund does not compete with
conventional sources of credit.
(3) Diversity of projects.--The Fund--
(A) shall seek to make equity investments in
a variety of viable projects, with a
significant share of investments--
(i) in smaller enterprises (as
defined in section 384A) in rural
communities of diverse sizes; and
(ii) in cooperative and
noncooperative enterprises; and
(B) shall be managed in a manner that
diversifies the risks to the Fund among a
variety of projects.
(4) Limitation on rural businesses assisted.--The
Fund shall not invest in any rural business that is
primarily retail in nature (as determined by the
Board), other than a purchasing cooperative.
(5) Interest rate limitations.--Returns on
investments in and by the Fund and returns on the
extension of credit by participants in projects
assisted by the Fund, shall not be subject to any State
or Federal law establishing a maximum allowable
interest rate.
(6) Requirements for recipients.--
(A) Other investments.--Any recipient of
amounts from the Fund shall make or obtain a
significant investment from a source of capital
other than the Fund.
(B) Sponsorship.--To be considered for an
equity investment from the Fund, a rural
business investment project shall be sponsored
by a regional, State, or local sponsoring or
endorsing organization such as--
(i) a financial institution;
(ii) a development organization; or
(iii) any other established entity
engaging or assisting in rural business
development, including a rural
cooperative.
(b) Technical Assistance.--The Fund, under terms and
conditions established by the Board, shall use not less than 2
percent of capital provided by the Federal Government to
provide technical assistance to rural businesses seeking an
equity investment from the Fund.
(c) Annual Audit.--
(1) In general.--The Board shall authorize an annual
audit of the financial statements of the Fund by a
nationally recognized auditing firm using generally
accepted accounting principles.
(2) Availability of audit results.--The results of
the audit required by paragraph (1) shall be made
available to investors in the Fund.
(d) Annual Report.--The Board shall prepare and make
available to the public an annual report that--
(1) describes the projects funded with amounts from
the Fund;
(2) specifies the recipients of amounts from the
Fund;
(3) specifies the coinvestors in all projects that
receive amounts from the Fund; and
(4) meets the reporting requirements, if any, of the
State under the law of which the Fund is established.
(e) Other Authorities.--
(1) In general.--The Board may exercise such other
authorities as are necessary to carry out this
subtitle.
(2) Oversight.--The Secretary shall enter in to a
contract with the Administrator of the Small Business
Administration under which the Administrator of the
Small Business Administration shall be responsible for
routine duties of the Secretary in regard to the Fund.
SEC. 383G. GOVERNANCE OF THE FUND.
(a) In General.--The Fund shall be governed by a board of
directors that represents all of the authorized private
investors in the Fund and the Federal Government and that
consists of--
(1) a designee of the Secretary;
(2) 2 members who are appointed by the Secretary and
are not Federal employees, including--
(A) 1 member with expertise in venture
capital investment; and
(B) 1 member with expertise in cooperative
development;
(3) 8 members who are elected by the authorized
private investors with investments in the Fund; and
(4) 1 member who is appointed by the Board and who is
a community banker from an insured depository
institution that has--
(A) total assets equal to or less than
$250,000,000; and
(B) an investment in the Fund.
(b) Limitation on Voting Control.--No individual investor
or group of authorized investors may control more than 25
percent of the votes on the Board.
SEC. 383H. AUTHORIZATION OF APPROPRIATIONS.
There are authorized to be appropriated such sums as are
necessary to carry out this subtitle.
Subtitle H--Rural Business Investment Program
SEC. 384A. DEFINITIONS.
In this subtitle:
(1) Articles.--The term ``articles'' means articles
of incorporation for an incorporated body or the
functional equivalent or other similar documents
specified by the Secretary for other business entities.
(2) Developmental venture capital.--The term
``developmental venture capital'' means capital in the
form of equity capital investments in Rural Business
Investment Companies with an objective of fostering
economic development in rural areas.
(3) Employee welfare benefit plan; pension plan.--
(A) In general.--The terms ``employee welfare
benefit plan'' and ``pension plan'' have the
meanings given the terms in section 3 of the
Employee Retirement Income Security Act of 1974
(29 U.S.C. 1002).
(B) Inclusions.--The terms ``employee welfare
benefit plan'' and ``pension plan'' include--
(i) public and private pension or
retirement plans subject to this
subtitle; and
(ii) similar plans not covered by
this subtitle that have been
established and that are maintained by
the Federal Government or any State
(including by a political subdivision,
agency, or instrumentality of the
Federal Government or a State) for the
benefit of employees.
(4) Equity capital.--The term ``equity capital''
means common or preferred stock or a similar
instrument, including subordinated debt with equity
features.
(5) Leverage.--The term ``leverage'' includes--
(A) debentures purchased or guaranteed by the
Secretary;
(B) participating securities purchased or
guaranteed by the Secretary; and
(C) preferred securities outstanding as of
the date of enactment of this subtitle.
(6) License.--The term ``license'' means a license
issued by the Secretary as provided in section 384D(c).
(7) Limited liability company.--The term ``limited
liability company'' means a business entity that is
organized and operating in accordance with a State
limited liability company law approved by the
Secretary.
(8) Member.--The term ``member'' means, with respect
to a Rural Business Investment Company that is a
limited liability company, a holder of an ownership
interest or a person otherwise admitted to membership
in the limited liability company.
(9) Operational assistance.--The term ``operational
assistance'' means management, marketing, and other
technical assistance that assists a rural business
concern with business development.
(10) Participation agreement.--The term
``participation agreement'' means an agreement, between
the Secretary and a Rural Business Investment Company
granted final approval under section 384D(d), that
requires the Rural Business Investment Company to make
investments in smaller enterprises in rural areas.
(11) Private capital.--
(A) In general.--The term ``private capital''
means the total of--
(i) the paid-in capital and paid-in
surplus of a corporate Rural Business
Investment Company, the contributed
capital of the partners of a
partnership Rural Business Investment
Company, or the equity investment of
the members of a limited liability
company Rural Business Investment
Company; and
(ii) unfunded binding commitments,
from investors that meet criteria
established by the Secretary to
contribute capital to the Rural
Business Investment Company, except
that unfunded commitments may be
counted as private capital for purposes
of approval by the Secretary of any
request for leverage, but leverage
shall not be funded based on the
commitments.
(B) Exclusions.--The term ``private capital''
does not include--
(i) any funds borrowed by a Rural
Business Investment Company from any
source;
(ii) any funds obtained through the
issuance of leverage; or
(iii) any funds obtained directly or
indirectly from the Federal Government
or any State (including by a political
subdivision, agency, or instrumentality
of the Federal Government or a State),
except for--
(I) 50 percent of funds from
the National Rural Cooperative
and Business Equity Fund;
(II) funds obtained from the
business revenues (excluding
any governmental appropriation)
of any federally chartered or
government-sponsored enterprise
established prior to the date
of enactment of this subtitle;
(III) funds invested by an
employee welfare benefit plan
or pension plan; and
(IV) any qualified nonprivate
funds (if the investors of the
qualified nonprivate funds do
not control, directly or
indirectly, the management,
board of directors, general
partners, or members of the
Rural Business Investment
Company).
(12) Qualified nonprivate funds.--The term
``qualified nonprivate funds'' means any--
(A) funds directly or indirectly invested in
any applicant or Rural Business Investment
Company on or before the date of enactment of
this subtitle, by any Federal agency, other
than the Department of Agriculture, under a
provision of law explicitly mandating the
inclusion of those funds in the definition of
the term ``private capital''; and
(B) funds invested in any applicant or Rural
Business Investment Company by 1 or more
entities of any State (including by a political
subdivision, agency, or instrumentality of the
State and including any guarantee extended by
those entities) in an aggregate amount that
does not exceed 33 percent of the private
capital of the applicant or Rural Business
Investment Company.
(13) Rural business concern.--The term ``rural
business concern'' means--
(A) a public, private, or cooperative for-
profit or nonprofit organization;
(B) a for-profit or nonprofit business
controlled by an Indian tribe on a Federal or
State reservation or other federally recognized
Indian tribal group; or
(C) any other person or entity;
that primarily operates in a rural area, as determined
by the Secretary.
(14) Rural business investment company.--The term
``Rural Business Investment Company'' means a company
that--
(A) has been granted final approval by the
Secretary under section 384D(d); and
(B) has entered into a participation
agreement with the Secretary.
(15) Smaller enterprise.--The term ``smaller
enterprise'' means any rural business concern that,
together with its affiliates--
(A) has--
(i) a net financial worth of not more
than $6,000,000, as of the date on
which assistance is provided under this
subtitle to the rural business concern;
and
(ii) an average net income for the 2-
year period preceding the date on which
assistance is provided under this
subtitle to the rural business concern,
of not more than $2,000,000, after
Federal income taxes (excluding any
carryover losses) except that, for
purposes of this clause, if the rural
business concern is not required by law
to pay Federal income taxes at the
enterprise level, but is required to
pass income through to the
shareholders, partners, beneficiaries,
or other equitable owners of the
business concern, the net income of the
business concern shall be determined by
allowing a deduction in an amount equal
to the total of--
(I) if the rural business
concern is not required by law
to pay State (and local, if
any) income taxes at the
enterprise level, the net
income (determined without
regard to this clause),
multiplied by the marginal
State income tax rate (or by
the combined State and local
income tax rates, as
applicable) that would have
applied if the business concern
were a corporation; and
(II) the net income (so
determined) less any deduction
for State (and local) income
taxes calculated under
subclause (I), multiplied by
the marginal Federal income tax
rate that would have applied if
the rural business concern were
a corporation; or
(B) satisfies the standard industrial
classification size standards established by
the Administrator of the Small Business
Administration for the industry in which the
rural business concern is primarily engaged.
SEC. 384B. PURPOSES.
The purposes of the Rural Business Investment Program
established under this subtitle are--
(1) to promote economic development and the creation
of wealth and job opportunities in rural areas and
among individuals living in those areas by encouraging
developmental venture capital investments in smaller
enterprises primarily located in rural areas; and
(2) to establish a developmental venture capital
program, with the mission of addressing the unmet
equity investment needs of small enterprises located in
rural areas, by authorizing the Secretary--
(A) to enter into participation agreements
with Rural Business Investment Companies;
(B) to guarantee debentures of Rural Business
Investment Companies to enable each Rural
Business Investment Company to make
developmental venture capital investments in
smaller enterprises in rural areas; and
(C) to make grants to Rural Business
Investment Companies, and to other entities,
for the purpose of providing operational
assistance to smaller enterprises financed, or
expected to be financed, by Rural Business
Investment Companies.
SEC. 384C. ESTABLISHMENT.
In accordance with this subtitle, the Secretary shall
establish a Rural Business Investment Program, under which the
Secretary may--
(1) enter into participation agreements with
companies granted final approval under section 384D(d)
for the purposes set forth in section 384B;
(2) guarantee the debentures issued by Rural Business
Investment Companies as provided in section 384E; and
(3) make grants to Rural Business Investment
Companies, and to other entities, under section 384H.
SEC. 384D. SELECTION OF RURAL BUSINESS INVESTMENT COMPANIES.
(a) Eligibility.--A company shall be eligible to apply to
participate, as a Rural Business Investment Company, in the
program established under this subtitle if--
(1) the company is a newly formed for-profit entity
or a newly formed for-profit subsidiary of such an
entity;
(2) the company has a management team with experience
in community development financing or relevant venture
capital financing; and
(3) the company will invest in enterprises that will
create wealth and job opportunities in rural areas,
with an emphasis on smaller businesses.
(b) Application.--To participate, as a Rural Business
Investment Company, in the program established under this
subtitle, a company meeting the eligibility requirements of
subsection (a) shall submit an application to the Secretary
that includes--
(1) a business plan describing how the company
intends to make successful developmental venture
capital investments in identified rural areas;
(2) information regarding the community development
finance or relevant venture capital qualifications and
general reputation of the management of the company;
(3) a description of how the company intends to work
with community organizations and to seek to address the
unmet capital needs of the communities served;
(4) a proposal describing how the company intends to
use the grant funds provided under this subtitle to
provide operational assistance to smaller enterprises
financed by the company, including information
regarding whether the company intends to use licensed
professionals, when necessary, on the staff of the
company or from an outside entity;
(5) with respect to binding commitments to be made to
the company under this subtitle, an estimate of the
ratio of cash to in-kind contributions;
(6) a description of the criteria to be used to
evaluate whether and to what extent the company meets
the purposes of the program established under this
subtitle;
(7) information regarding the management and
financial strength of any parent firm, affiliated firm,
or any other firm essential to the success of the
business plan of the company; and
(8) such other information as the Secretary may
require.
(c) Issuance of License.--
(1) Submission of application.--Each applicant for a
license to operate as a Rural Business Investment
Company under this subtitle shall submit to the
Secretary an application, in a form and including such
documentation as may be prescribed by the Secretary.
(2) Procedures.--
(A) Status.--Not later than 90 days after the
initial receipt by the Secretary of an
application under this subsection, the
Secretary shall provide the applicant with a
written report describing the status of the
application and any requirements remaining for
completion of the application.
(B) Approval or disapproval.--Within a
reasonable time after receiving a completed
application submitted in accordance with this
subsection and in accordance with such
requirements as the Secretary may prescribe by
regulation, the Secretary shall--
(i) approve the application and issue
a license for the operation to the
applicant, if the requirements of this
section are satisfied; or
(ii) disapprove the application and
notify the applicant in writing of the
disapproval.
(3) Matters considered.--In reviewing and processing
any application under this subsection, the Secretary--
(A) shall determine whether--
(i) the applicant meets the
requirements of subsection (d); and
(ii) the management of the applicant
is qualified and has the knowledge,
experience, and capability necessary to
comply with this subtitle;
(B) shall take into consideration--
(i) the need for and availability of
financing for rural business concerns
in the geographic area in which the
applicant is to commence business;
(ii) the general business reputation
of the owners and management of the
applicant; and
(iii) the probability of successful
operations of the applicant, including
adequate profitability and financial
soundness; and
(C) shall not take into consideration any
projected shortage or unavailability of grant
funds or leverage.
(d) Approval; Designation.--The Secretary may approve an
applicant to operate as a Rural Business Investment Company
under this subtitle and designate the applicant as a Rural
Business Investment Company, if--
(1) the Secretary determines that the application
satisfies the requirements of subsection (b);
(2) the area in which the Rural Business Investment
Company is to conduct its operations, and establishment
of branch offices or agencies (if authorized by the
articles), are approved by the Secretary; and
(3) the applicant enters into a participation
agreement with the Secretary.
SEC. 384E. DEBENTURES.
(a) In General.--The Secretary may guarantee the timely
payment of principal and interest, as scheduled, on debentures
issued by any Rural Business Investment Company.
(b) Terms and Conditions.--The Secretary may make
guarantees under this section on such terms and conditions as
the Secretary considers appropriate, except that the term of
any debenture guaranteed under this section shall not exceed 15
years.
(c) Full Faith and Credit of the United States.--Section
381H(i) shall apply to any guarantee under this section.
(d) Maximum Guarantee.--Under this section, the Secretary
may--
(1) guarantee the debentures issued by a Rural
Business Investment Company only to the extent that the
total face amount of outstanding guaranteed debentures
of the Rural Business Investment Company does not
exceed 300 percent of the private capital of the Rural
Business Investment Company, as determined by the
Secretary; and
(2) provide for the use of discounted debentures.
SEC. 384F. ISSUANCE AND GUARANTEE OF TRUST CERTIFICATES.
(a) Issuance.--The Secretary may issue trust certificates
representing ownership of all or a fractional part of
debentures issued by a Rural Business Investment Company and
guaranteed by the Secretary under this subtitle, if the
certificates are based on and backed by a trust or pool
approved by the Secretary and composed solely of guaranteed
debentures.
(b) Guarantee.--
(1) In general.--The Secretary may, under such terms
and conditions as the Secretary considers appropriate,
guarantee the timely payment of the principal of and
interest on trust certificates issued by the Secretary
or agents of the Secretary for purposes of this
section.
(2) Limitation.--Each guarantee under this subsection
shall be limited to the extent of principal and
interest on the guaranteed debentures that compose the
trust or pool.
(3) Prepayment or default.--
(A) In general.--In the event a debenture in
a trust or pool is prepaid, or in the event of
default of such a debenture, the guarantee of
timely payment of principal and interest on the
trust certificates shall be reduced in
proportion to the amount of principal and
interest the prepaid debenture represents in
the trust or pool.
(B) Interest.--Interest on prepaid or
defaulted debentures shall accrue and be
guaranteed by the Secretary only through the
date of payment of the guarantee.
(C) Redemption.--At any time during its term,
a trust certificate may be called for
redemption due to prepayment or default of all
debentures.
(c) Full Faith and Credit of the United States.--Section
381H(i) shall apply to any guarantee of a trust certificate
issued by the Secretary under this section.
(d) Subrogation and Ownership Rights.--
(1) Subrogation.--If the Secretary pays a claim under
a guarantee issued under this section, the claim shall
be subrogated fully to the rights satisfied by the
payment.
(2) Ownership rights.--No Federal, State, or local
law shall preclude or limit the exercise by the
Secretary of the ownership rights ofthe Secretary in a
debenture residing in a trust or pool against which 1 or more trust
certificates are issued under this section.
(e) Management and Administration.--
(1) Registration.--The Secretary shall provide for a
central registration of all trust certificates issued
under this section.
(2) Creation of pools.--The Secretary may--
(A) maintain such commercial bank accounts or
investments in obligations of the United States
as may be necessary to facilitate the creation
of trusts or pools backed by debentures
guaranteed under this subtitle; and
(B) issue trust certificates to facilitate
the creation of those trusts or pools.
(3) Fidelity bond or insurance requirement.--Any
agent performing functions on behalf of the Secretary
under this paragraph shall provide a fidelity bond or
insurance in such amount as the Secretary considers to
be necessary to fully protect the interests of the
United States.
(4) Regulation of brokers and dealers.--The Secretary
may regulate brokers and dealers in trust certificates
issued under this section.
(5) Electronic registration.--Nothing in this
subsection prohibits the use of a book-entry or other
electronic form of registration for trust certificates
issued under this section.
SEC. 384G. FEES.
(a) In General.--The Secretary may charge such fees as the
Secretary considers appropriate with respect to any guarantee
or grant issued under this subtitle.
(b) Trust Certificate.--Notwithstanding subsection (a), the
Secretary shall not collect a fee for any guarantee of a trust
certificate under section 384F, except that any agent of the
Secretary may collect a fee approved by the Secretary for the
functions described in section 384F(e)(2).
(c) License.--
(1) In general.--The Secretary may prescribe fees to
be paid by each applicant for a license to operate as a
Rural Business Investment Company under this subtitle.
(2) Use of amounts.--Fees collected under this
subsection--
(A) shall be deposited in the account for
salaries and expenses of the Secretary; and (B)
are authorized to be appropriated solely to
cover the costs of licensing examinations.
SEC. 384H. OPERATIONAL ASSISTANCE GRANTS.
(a) In General.--
(1) Authority.--In accordance with this section, the
Secretary may make grants to Rural Business Investment
Companies and to other entities, as authorized by this
subtitle, to provide operational assistance to smaller
enterprises financed, or expected to be financed, by
the entities.
(2) Terms.--Grants made under this subsection shall
be made over a multiyear period (not to exceed 10
years) under such other terms as the Secretary may
require.
(3) Use of funds.--The proceeds of a grant made under
this paragraph may be used by the Rural Business
Investment Company receiving the grant only to--
(A) provide operational assistance in
connection with an equity investment (made with
capital raised after the effective date of this
subtitle) in a business located in a rural
area; or
(B) pay operational expenses of the Rural
Business Investment Company.
(4) Submission of plans.--A Rural Business Investment
Company shall be eligible for a grant under this
section only if the Rural Business Investment Company
submits to the Secretary, in such form and manner as
the Secretary may require, a plan for use of the grant.
(5) Grant amount.--
(A) Rural business investment companies.--The
amount of a grant made under this subsection to
a Rural Business Investment Company shall be
equal to the lesser of--
(i) 50 percent of the amount of
resources (in cash or in kind) raised
by the Rural Business Investment
Company; or
(ii) $1,000,000.
(B) Other entities.--The amount of a grant
made under this subsection to any entity other
than a Rural Business Investment Company shall
be equal to the resources (in cash or in kind)
raised by the entity in accordance with the
requirements applicable to Rural Business
Investment Companies under this subtitle.
(b) Supplemental Grants.--
(1) In general.--The Secretary may make supplemental
grants to Rural Business Investment Companies and to
other entities, as authorized by this subtitle under
such terms as the Secretary may require, to provide
additional operational assistance to smaller
enterprises financed, or expected to be financed, by
the Rural Business Investment Companies and other
entities.
(2) Matching requirement.--The Secretary may require,
as a condition of any supplemental grant made under
this subsection, that the Rural Business Investment
Company or entity receiving the grant provide from
resources (in cash or in kind), other than resources
provided by the Secretary, a matching contribution
equal to the amount of the supplemental grant.
SEC. 384I. RURAL BUSINESS INVESTMENT COMPANIES.
(a) Organization.--For the purpose of this subtitle, a
Rural Business Investment Company shall--
(1) be an incorporated body, a limited liability
company, or a limited partnership organized and
chartered or otherwise existing under State law solely
for the purpose of performing the functions and
conducting the activities authorized by this subtitle;
(2)(A) if incorporated, have succession for a period
of not less than 30 years unless earlier dissolved by
the shareholders of the Rural Business Investment
Company; and
(B) if a limited partnership or a limited liability
company, have succession for a period of not less than
10 years; and
(3) possess the powers reasonably necessary to
perform the functions and conduct the activities.
(b) Articles.--The articles of any Rural Business
Investment Company--
(1) shall specify in general terms--
(A) the purposes for which the Rural Business
Investment Company is formed;
(B) the name of the Rural Business Investment
Company;
(C) the area or areas in which the operations
of the Rural Business Investment Company are to
be carried out;
(D) the place where the principal office of
the Rural Business Investment Company is to be
located; and
(E) the amount and classes of the shares of
capital stock of the Rural Business Investment
Company;
(2) may contain any other provisions consistent with
this subtitle that the Rural Business Investment
Company may determine appropriate to adopt for the
regulation of the business of the Rural Business
Investment Company and the conduct of the affairs of
the Rural Business Investment Company; and
(3) shall be subject to the approval of the
Secretary.
(c) Capital Requirements.--
(1) In general.--Except as provided in paragraph (2),
the private capital of each Rural Business Investment
Company shall be not less than--
(A) $5,000,000; or
(B) $10,000,000, with respect to each Rural
Business Investment Company authorized or
seeking authority to issue participating
securities to be purchased or guaranteed by the
Secretary under this subtitle.
(2) Exception.--The Secretary may, in the discretion
of the Secretary and based on a showing of special
circumstances and good cause, permit the private
capital of a Rural Business Investment Company
described in paragraph (1)(B) to be less than
$10,000,000, but not less than $5,000,000, if the
Secretary determines that the action would not create
or otherwise contribute to an unreasonable risk of
default or loss to the Federal Government.
(3) Adequacy.--In addition to the requirements of
paragraph (1), the Secretary shall--
(A) determine whether the private capital of
each Rural Business Investment Company is
adequate to ensure a reasonable prospect that
the Rural Business Investment Company will be
operated soundly and profitably, and managed
actively and prudently in accordance with the
articles of the Rural Business Investment
Company;
(B) determine that the Rural Business
Investment Company will be able to comply with
the requirements of this subtitle; and
(C) require that at least 75 percent of the
capital of each Rural Business Investment
Company is invested in rural business concerns.
(d) Diversification of Ownership.--The Secretary shall
ensure that the management of each Rural Business Investment
Company licensed after the date of enactment of this subtitle
is sufficiently diversified from and unaffiliated with the
ownership of the Rural Business Investment Company so as to
ensure independence and objectivity in the financial management
and oversight of the investments and operations of the Rural
Business Investment Company.
SEC. 384J. FINANCIAL INSTITUTION INVESTMENTS.
(a) In General.--Except as otherwise provided in this
section and notwithstanding any other provision of law, the
following banks, associations, and institutions may invest in
any Rural Business Investment Company or in any entity
established to invest solely in Rural Business Investment
Companies:
(1) Any national bank.
(2) Any member bank of the Federal Reserve System.
(3) Any Federal savings association.
(4) Any Farm Credit System institution described in
section 1.2(a) of the Farm Credit Act of 1971 (12
U.S.C. 2002(a)).
(5) Any insured bank that is not a member of the
Federal Reserve System, to the extent permitted under
applicable State law.
(b) Limitation.--No bank, association, or institution
described in subsection (a) may make investments described in
subsection (a) that are greater than 5 percent of the capital
and surplus of the bank, association, or institution.
(c) Limitation on Rural Business Investment Companies
Controlled by Farm Credit System Institutions.--If a Farm
Credit System institution described in section 1.2(a) of the
Farm Credit Act of 1971 (12 U.S.C. 2002(a)) holds more than 30
percent of the voting shares of a Rural Business Investment
Company, either alone or in conjunction with other System
institutions (or affiliates), the Rural Business Investment
Company shall not provide equity investments in, or provide
other financial assistance to, entities that are not otherwise
eligible to receive financing from the Farm Credit System under
that Act (12 U.S.C. 2001 et seq.).
SEC. 384K. REPORTING REQUIREMENT.
Each Rural Business Investment Company that participates in
the program established under this subtitle shall provide to
the Secretary such information as the Secretary may require,
including--
(1) information relating to the measurement criteria
that the Rural Business Investment Company proposed in
the program application of the Rural Business
Investment Company; and
(2) in each case in which the Rural Business
Investment Company under this subtitle makes an
investment in, or a loan or grant to, a business that
is not located in a rural area, a report on the number
and percentage of employees of the business who reside
in those areas.
SEC. 384L. EXAMINATIONS.
(a) In General.--Each Rural Business Investment Company
that participates in the program established under this
subtitle shall be subject to examinations made at the direction
of the Secretary in accordance with this section.
(b) Assistance of Private Sector Entities.--An examination
under this section may be conducted with the assistance of a
private sector entity that has the qualifications and the
expertise necessary to conduct such an examination.
(c) Costs.--
(1) In general.--The Secretary may assess the cost of
an examination under this section, including
compensation of the examiners, against the Rural
Business Investment Company examined.
(2) Payment.--Any Rural Business Investment Company
against which the Secretary assesses costs under this
paragraph shall pay the costs.
(d) Deposit of Funds.--Funds collected under this section
shall--
(1) be deposited in the account that incurred the
costs for carrying out this section;
(2) be made available to the Secretary to carry out
this section, without further appropriation; and
(3) remain available until expended.
SEC. 384M. INJUNCTIONS AND OTHER ORDERS.
(a) In General.--
(1) Application by secretary.--Whenever, in the
judgment of the Secretary, a Rural Business Investment
Company or any other person has engaged or is about to
engage in any act or practice that constitutes or will
constitute a violation of a provision of this subtitle
(including any rule, regulation, order, or
participation agreement under this subtitle), the
Secretary may apply to the appropriate district court
of the United States for an order enjoining the act or
practice, or for an order enforcing compliance with the
provision, rule, regulation, order, or participation
agreement.
(2) Jurisdiction; relief.--The court shall have
jurisdiction over the action and, on a showing by the
Secretary that the Rural Business Investment Company or
other person has engaged or is about to engage in an
act or practice described in paragraph (1), a permanent
or temporary injunction, restraining order, or other
order, shall be granted without bond.
(b) Jurisdiction.--
(1) In general.--In any proceeding under subsection
(a), the court as a court of equity may, to such extent
as the court considers necessary, take exclusive
jurisdiction over the Rural Business Investment Company
and the assets of the Rural Business Investment
Company, wherever located.
(2) Trustee or receiver.--The court shall have
jurisdiction in any proceeding described in paragraph
(1) to appoint a trustee or receiver to hold or
administer the assets.
(c) Secretary as Trustee or Receiver.--
(1) Authority.--The Secretary may act as trustee or
receiver of a Rural Business Investment Company.
(2) Appointment.--On the request of the Secretary,
the court shall appoint the Secretary to act as a
trustee or receiver of a Rural Business Investment
Company unless the court considers the appointment
inequitable or otherwise inappropriate by reason of any
special circumstances involved.
SEC. 384N. ADDITIONAL PENALTIES FOR NONCOMPLIANCE.
(a) In General.--With respect to any Rural Business
Investment Company that violates or fails to comply with this
subtitle (including any rule, regulation, order, or
participation agreement under this subtitle), the Secretary
may, in accordance with this section--
(1) void the participation agreement between the
Secretary and the Rural Business Investment Company;
and
(2) cause the Rural Business Investment Company to
forfeit all of the rights and privileges derived by the
Rural Business Investment Company under this subtitle.
(b) Adjudication of Noncompliance.--
(1) In general.--Before the Secretary may cause a
Rural Business Investment Company to forfeit rights or
privileges under subsection (a), a court of the United
States of competent jurisdiction must find that the
Rural Business Investment Company committed a
violation, or failed to comply, in a cause of action
brought for that purpose in the district, territory, or
other place subject to the jurisdiction of the United
States, in which the principal office of the Rural
Business Investment Company is located.
(2) Parties authorized to file causes of action.--
Each cause of action brought by the United States under
this subsection shall be brought by the Secretary or by
the Attorney General.
SEC. 384O. UNLAWFUL ACTS AND OMISSIONS; BREACH OF FIDUCIARY DUTY.
(a) Parties Deemed To Commit a Violation.--Whenever any
Rural Business Investment Company violates this subtitle
(including any rule, regulation, order, or participation
agreement under this subtitle), by reason of the failure of the
Rural Business Investment Company to comply with this subtitle
or by reason of its engaging in any act or practice that
constitutes or will constitute a violation of this subtitle,
the violation shall also be deemed to be a violation and an
unlawful act committed by any person that, directly or
indirectly, authorizes, orders, participates in, causes, brings
about, counsels, aids, or abets in the commission of any acts,
practices, or transactions that constitute or will constitute,
in whole or in part, the violation.
(b) Fiduciary Duties.--It shall be unlawful for any
officer, director, employee, agent, or other participant in the
management or conduct of the affairs of a Rural Business
Investment Company to engage in any act or practice, or to omit
any act or practice, in breach of the fiduciary duty of the
officer, director, employee, agent, or participant if, as a
result of the act or practice, the Rural Business Investment
Company suffers or is in imminent danger of suffering financial
loss or other damage.
(c) Unlawful Acts.--Except with the written consent of the
Secretary, it shall be unlawful--
(1) for any person to take office as an officer,
director, or employee of any Rural Business Investment
Company, or to become an agent or participant in the
conduct of the affairs or management of a Rural
Business Investment Company, if the person--
(A) has been convicted of a felony, or any
other criminal offense involving dishonesty or
breach of trust; or
(B) has been found civilly liable in damages,
or has been permanently or temporarily enjoined
by an order, judgment, or decree of a court of
competent jurisdiction, by reason of any act or
practice involving fraud, or breach of trust;
and
(2) for any person to continue to serve in any of the
capacities described in paragraph (1), if--
(A) the person is convicted of a felony, or
any other criminal offense involving dishonesty
or breach of trust; or
(B) the person is found civilly liable in
damages, or is permanently or temporarily
enjoined byan order, judgment, or decree of a
court of competent jurisdiction, by reason of any act or practice
involving fraud or breach of trust.
SEC. 384P. REMOVAL OR SUSPENSION OF DIRECTORS OR OFFICERS.
Using the procedures established by the Secretary for
removing or suspending a director or an officer of a Rural
Business Investment Company, the Secretary may remove or
suspend any director or officer of any Rural Business
Investment Company.
SEC. 384Q. CONTRACTING OF FUNCTIONS.
Notwithstanding any other provision of law, the Secretary
shall enter into an interagency agreement with the
Administrator of the Small Business Administration to carry
out, on behalf of the Secretary, the day-to-day management and
operation of the program authorized by this subtitle.
SEC. 384R. REGULATIONS.
The Secretary may promulgate such regulations as the
Secretary considers necessary to carry out this subtitle.
SEC. 384S. FUNDING.
(a) In General.--Not later than 30 days after the date of
enactment of this Act, out of any funds in the Treasury not
otherwise appropriated, the Secretary of the Treasury shall
transfer to the Secretary of Agriculture--
(1) such sums as may be necessary for the cost of
guaranteeing $350,000,000 of debentures under this
subtitle; and
(2) $50,000,000 to make grants under this subtitle.
(b) Receipt and Acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to carry out
this section the funds transferred under subsection (a),
without further appropriation.
(c) Availability of Funds.--Funds transferred under
subsection (a) shall remain available until expended.
Subtitle I--Rural Endowment Program
SEC. 385A. PURPOSE.
The purpose of this subtitle is to provide rural
communities with technical and financial assistance to
implement comprehensive community development strategies to
reduce the economic and social distress resulting from poverty,
high unemployment, outmigration, plant closings, agricultural
downturn, declines in the natural resource-based economy, or
environmental degradation.
SEC. 385B. DEFINITIONS.
In this subtitle:
(1) Comprehensive community development strategy.--
The term ``comprehensive community development
strategy'' means a community development strategy
described in section 385C(e).
(2) Eligible rural area.--
(A) In general.--The term ``eligible rural
area'' means an area with a population of
25,000 inhabitants or less, as determined by
the Secretary using the most recent decennial
census.
(B) Exclusions.--The term ``eligible rural
area'' does not include--
(i) any area designated by the
Secretary as a rural empowerment zone
or rural enterprise community; or
(ii) an urbanized area immediately
adjacent to an incorporated city or
town with a population of more than
25,000 inhabitants.
(3) Endowment fund.--The term ``endowment fund''
means a long-term fund that an approved program entity
is required to establish under section 385C(f)(3).
(4) Performance-based benchmarks.--The term
``performance-based benchmarks'' means a set of
annualized goals and tasks established by a recipient
of a grant under the Program, in collaboration with the
Secretary, for the purpose of measuring performance in
meeting the comprehensive community development
strategy of the recipient.
(5) Program.--The term ``Program'' means the Rural
Endowment Program established under section 385C(a).
(6) Program entity.--The term ``program entity''
means--
(A) a private nonprofit community-based
development organization;
(B) a unit of local government (including a
multijurisdictional unit of local government);
(C) an Indian tribe (as defined in section 4
of the Indian Self-Determination and Education
Assistance Act (25 U.S.C. 450b));
(D) a consortium comprised of an organization
described in subparagraph (A) and a unit of
local government; or
(E) a consortium of entities specified in
subparagraphs (A) through (D);
that serves an eligible rural area.
(7) Program-related investment.--The term ``program-
related investment'' means--
(A) a loan, loan guarantee, grant, payment of
a technical fee, or other expenditure provided
for an affordable housing, community facility,
small business, environmental improvement, or
other community development project that is
part of a comprehensive community development
strategy; and
(B) support services relating to a project
described in subparagraph (A).
SEC. 385C. RURAL ENDOWMENT PROGRAM.
(a) Establishment.--
(1) In general.--The Secretary may establish a
program, to be known as the ``Rural Endowment
Program'', to provide approved program entities with
assistance in developing and implementing comprehensive
community development strategies for eligible rural
areas.
(2) Purposes.--The purposes of the Program are--
(A) to enhance the ability of an eligible
rural area to engage in comprehensive community
development;
(B) to leverage private and public resources
for the benefit of community development
efforts in eligible rural areas;
(C) to make available staff of Federal
agencies to directly assist the community
development efforts of an approved program
entity or eligible rural area; and
(D) to strengthen the asset base of an
eligible rural area to further long-term,
ongoing community development.
(b) Applications.--
(1) In general.--To receive an endowment grant under
the Program, the eligible entity shall submit an
application at such time, in such form, and containing
such information as the Secretary may require.
(2) Regional applications.--
(A) In general.--Where appropriate, the
Secretary shall encourage regional applications
from program entities serving more than 1
eligible rural area.
(B) Criteria for applications.--To be
eligible for an endowment grant for a regional
application the program entities that submit
the application shall demonstrate that--
(i) a comprehensive community
development strategy for the eligible
rural areas is best accomplished
through a regional approach; and
(ii) the combined population of the
eligible rural areas covered by the
comprehensive community development
strategy is 75,000 inhabitants or less.
(C) Amount of endowment grants.--For the
purpose of subsection (f)(2), 2 or more program
entities that submit a regional application
shall be considered to be a single program
entity.
(3) Preference.--The Secretary shall give preference
to a joint application submitted by a private,
nonprofit community development corporation and a unit
of local government.
(c) Entity Approval.--The Secretary shall approve a program
entity to receive grants under the Program, if the program
entity meets criteria established by the Secretary, including
the following:
(1) Distressed rural area.--The program entity shall
serve a rural area that suffers from economic or social
distress resulting from poverty, high unemployment,
outmigration, plant closings, agricultural downturn,
declines in the natural resource-based economy, or
environmental degradation.
(2) Capacity to implement strategy.--The program
entity shall demonstrate the capacity to implement a
comprehensive community development strategy.
(3) Goals.--The goals described in the application
submitted under subsection (b) shall be consistent with
this section.
(4) Participation process.--The program entity shall
demonstrate the ability to convene and maintain a
multi-stakeholder, community-based participation
process.
(d) Planning Grants to Conditionally Approved Program
Entities.--
(1) In general.--The Secretary may award supplemental
grants to approved program entities to assist the
approved program entities in the development of a
comprehensive community development strategy under
subsection (e) November 23, 2001.
(2) Eligibility for supplemental grants.--In
determining whether to award a supplemental grant to an
approved program entity, the Secretary shall consider
the economic need of the approved program entity.
(3) Limitations on amount of grants.--Under this
subsection, an approved program entity may receive a
supplemental grant in an amount of not more than
$100,000.
(e) Endowment Grant Award.--
(1) In general.--To be eligible for an endowment
grant under the Program, an approved program entity
shall develop and obtain the approval of the Secretary
for a comprehensive community development strategy
that--
(A) is designed to reduce economic or social
distress resulting from poverty, high
unemployment, outmigration, plant closings,
agricultural downturn, declines in the natural
resource-based economy, or environmental
degradation;
(B) addresses a broad range of the
development needs of a community, including
economic, social, and environmental needs, for
a period of not less than 10 years;
(C) is developed with input from a broad
array of local governments and business, civic,
and community organizations;
(D) specifies measurable performance-based
outcomes for all activities; and
(E) includes a financial plan for achieving
the outcomes and activities of the
comprehensive community development strategy
that identifies sources for, or a plan to meet,
the requirement for a non-Federal share under
subsection (f)(4)(B).
(2) Final approval.--
(A) In general.--An approved program entity
shall receive final approval if the Secretary
determines that--
(i) the comprehensive community
development strategy of the approved
program entity meets the requirements
of this section;
(ii) the management and
organizational structure of the
approved program entity is sufficient
to oversee fund and development
activities;
(iii) the approved program entity has
established an endowment fund; and
(iv) the approved program entity will
be able to provide the non-Federal
share required under subsection
(f)(4)(B).
(B) Conditions.--As part of the final
approval, the approved program entity shall
agree to--
(i) achieve, to the maximum extent
practicable, performance-based
benchmarks; and
(ii) comply with the terms of the
comprehensive community development
strategy for a period of not less than
10 years.
(f) Endowment Grants.--
(1) In general.--Under the Program, the Secretary may
make endowment grants to approved program entities with
final approval to implement an approved comprehensive
community development strategy.
(2) Amount of grants.--An endowment grant to an
approved program entity shall be in an amount of not
more than $6,000,000, as determined by the Secretary
based on--
(A) the size of the population of the
eligible rural area for which the endowment
grant is to be used;
(B) the size of the eligible rural area for
which the endowment grant is to be used;
(C) the extent of the comprehensive community
development strategy to be implemented using
the endowment grant award; and
(D) the extent to which the community suffers
from economic or social distress resulting
from--
(i) poverty;
(ii) high unemployment;
(iii) outmigration;
(iv) plant closings;
(v) agricultural downturn;
(vi) declines in the natural
resource-based economy; or
(vii) environmental degradation.
(3) Endowment funds.--
(A) Establishment.--On notification from the
Secretary that the program entity has been
approved under subsection (c), the approved
program entity shall establish an endowment
fund.
(B) Funding of endowment.--Federal funds
provided in the form of an endowment grant
under the Program shall--
(i) be deposited in the endowment
fund;
(ii) be the sole property of the
approved program entity;
(iii) be used in a manner consistent
with this subtitle; and
(iv) be subject to oversight by the
Secretary for a period of not more than
10 years.
(C) Interest.--Interest earned on Federal
funds in the endowment fund shall be--
(i) retained by the grantee; and
(ii) treated as Federal funds are
treated under subparagraph (B).
(D) Limitation.--The Secretary shall
promulgate regulations on matching funds and
returns on program-related investments only to
the extent that such funds or proceeds are used
in a manner consistent with this subtitle.
(4) Conditions.--
(A) Disbursement.--
(i) In general.--Each endowment grant
award shall be disbursed during a
period not to exceed 5 years beginning
during the fiscal year containing the
date of final approval of the approved
program entity under subsection (e)(3).
(ii) Manner of disbursement.--Subject
to subparagraph (B), the Secretary may
disburse a grant award in 1 lump sum or
in incremental disbursements made each
fiscal year.
(iii) Incremental disbursements.--If
the Secretary elects to make
incremental disbursements, for each
fiscal year after the initial
disbursement, the Secretary shall make
a disbursement under clause (i) only if
the approved program entity--
(I) has met the performance-
based benchmarks of the
approved program entity for the
preceding fiscal year; and
(II) has provided the non-
Federal share required for the
preceding fiscal year under
subparagraph (B).
(iv) Advance disbursements.--The
Secretary may make disbursements under
this paragraph notwithstanding any
provision of law limiting grant
disbursements to amounts necessary to
cover expected expenses on a term
basis.
(B) Non-federal share.--
(i) In general.--Except as provided
in clause (ii), for each disbursement
under subparagraph (A), the Secretary
shall require the approved program
entity to provide a non-Federal share
in an amount equal to 50 percent of the
amount of funds received by the
approved program entity under the
disbursement.
(ii) Lower non-federal share.--In the
case of an approved program entity that
serves a small, poor rural area (as
determined by the Secretary), the
Secretary may--
(I) reduce the non-Federal
share to not less than 20
percent; and
(II) allow the non-Federal
share to be provided in the
form of in-kind contributions.
(iii) Binding commitments; plan.--For
the purpose of meeting the non-Federal
share requirement with respect to the
first disbursement of an endowment
grant award to the approved program
entity under the Program, an approved
program entity shall--
(I) have, at a minimum,
binding commitments to provide
the non-Federal share required
with respect to the first
disbursement of the endowment
grant award; and
(II) if the Secretary is
making incremental
disbursements of a grant,
develop a viable plan for
providing the remaining amount
of the required non-Federal
share.
(C) Limitations.--
(i) In general.--Subject to clause
(ii), of each disbursement, an approved
program entity shall use--
(I) not more than 10 percent
for administrative costs of
carrying out program-related
investments;
(II) not more than 20 percent
for the purpose of maintaining
a loss reserve account; and
(III) the remainder for
program-related investments
contained in the comprehensive
community development strategy.
(ii) Loss reserve account.--If all
disbursed funds available under a grant
are expended in accordance with clause
(i) and the grant recipient has no
expected losses to cover for a fiscal
year, the recipient may use funds in
the loss reserve account described in
clause (i)(II) for program-related
investments described in clause
(i)(III) for which no reserve for
losses is required.
(g) Federal Agency Assistance.--Under the Program, the
Secretary shall provide and coordinate technical assistance for
grant recipients by designated field staff of Federal agencies.
(h) Private Technical Assistance.--
(1) In general.--Under the Program, the Secretary may
make grants to qualified intermediaries to provide
technical assistance and capacity building to approved
program entities under the Program.
(2) Duties.--A qualified intermediary that receives a
grant under this subsection shall--
(A) provide assistance to approved program
entities in developing, coordinating, and
overseeing investment strategy;
(B) provide technical assistance in all
aspects of planning, developing, and managing
the Program; and
(C) facilitate Federal and private sector
involvement in rural community development.
(3) Eligibility.--To be considered a qualified
intermediary under this subsection, an intermediary
shall--
(A) be a private, nonprofit community
development organization;
(B) have expertise in Federal or private
rural community development policy or programs;
and
(C) have experience in providing technical
assistance, planning, and capacity building
assistance to rural communities and nonprofit
entities in eligible rural areas.
(4) Maximum amount of grants.--A qualified
intermediary may receive a grant under this subsection
of not more than $100,000.
(5) Funding.--Of the amounts made available under
section 385D, the Secretary may use to carry out this
subsection not more than $2,000,000 for each of not
more than 2 fiscal years.
SEC. 385D. FUNDING.
(a) Fiscal Years 2002 and 2003.--
(1) In general.--Not later than 30 days after the
date of enactment of this subtitle, out of any funds in
the Treasury not otherwise appropriated, the Secretary
of the Treasury shall transfer to the Secretary of
Agriculture to carry out this subtitle $82,000,000 for
the period of fiscal years 2002 and 2003, to remain
available until expended.
(2) Schedule for obligations.--Of the amounts made
available under paragraph (1)--
(A) not more than $5,000,000 shall be
obligated to carry out section 385C(d);
(B) not less than $75,000,000 shall be
obligated to carry out section 385C(f); and
(C) not less than $2,000,000 shall be
obligated to carry out section 385C(h).
(3) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this subtitle the funds transferred under
paragraph (1), without further appropriation.
(b) Fiscal Years 2004 through 2006.--There are authorized
to be appropriated such sums as are necessary to carry out this
subtitle for each of fiscal years 2004 through 2006.
Subtitle J--SEARCH Grants for Small Communities
SEC. 386A. DEFINITIONS.
In this subtitle:
(1) Council.--The term ``council'' means an
independent citizens' council established by section
386B(d).
(2) Environmental project.--
(A) In general.--The term ``environmental
project'' means a project that--
(i) improves environmental quality;
and
(ii) is necessary to comply with an
environmental law (including a
regulation).
(B) Inclusion.--The term ``environmental
project'' includes an initial feasibility study
of a project.
(3) Region.--The term ``region'' means a geographic
area of a State, as determined by the Governor of the
State.
(4) SEARCH grant.--The term ``SEARCH grant'' means a
grant for special environmental assistance for the
regulation of communities and habitat awarded under
section 386B(e)(3).
(5) Small community.--The term ``small community''
means an incorporated or unincorporated rural community
with a population of 2,500 inhabitants or less.
(6) State.--The term ``State'' has the meaning given
the term in section 381A(1).
SEC. 386B. SEARCH GRANT PROGRAM.
(a) In General.--There is established the SEARCH Grant
Program.
(b) Application.--
(1) In general.--Not later than October 1 of each
fiscal year, a State may submit to the Secretary an
application to receive a grant under subsection (c) for
the fiscal year.
(2) Requirements.--An application under paragraph (1)
shall contain--
(A) a certification by the State that the
State has appointed members to the council of
the State under subsection (c)(2)(C); and
(B) such information as the Secretary may
reasonably require.
(c) Grants to States.--
(1) In general.--Not later than 60 days after the
date on which the Office of Management and Budget
apportions any amounts made available under this
subtitle, for each fiscal year after the date of
enactment of this subtitle, the Secretary shall, on
request by a State--
(A) determine whether any application
submitted by the State under subsection (b)
meets the requirements of subsection (b)(2);
and
(B) subject to paragraph (2), subsection
(e)(4)(B)(ii), and section 386D(b), if the
Secretary determines that the application meets
the requirements of subsection (b)(2), award a
grant of not to exceed $1,000,000 to the State,
to be used by the council of the State to award
SEARCH grants under subsection (e).
(2) Grants to certain states.--The aggregate amount
of grants awarded to States other than Alaska, Hawaii,
or 1 of the 48 contiguous States, under this subsection
shall not exceed $1,000,000 for any fiscal year.
(d) Independent Citizens' Council.--
(1) Establishment.--There is established in each
State an independent citizens' council to carry out the
duties described in this section.
(2) Composition.--
(A) In general.--Each council shall be
composed of 9 members, appointed by the
Governor of the State.
(B) Representation; residence.--Each member
of a council shall--
(i) represent an individual region of
the State, as determined by the
Governor of the State in which the
council is established;
(ii) reside in a small community of
the State; and
(iii) be representative of the
populations of the State.
(C) Appointment.--Before a State receives
funds under this subtitle, the State shall
appoint members to the council for the fiscal
year, except that not more than 1 member shall
be an agent, employee, or official of the State
government.
(D) Chairperson.--Each council shall select a
chairperson from among the members of the
council, except that a member who is an agent,
employee, or official of the State government
shall not serve as chairperson.
(E) Federal representation.--
(i) In general.--An officer,
employee, or agent of the Federal
Government may participate in the
activities of the council--
(I) in an advisory capacity;
and
(II) at the invitation of the
council.
(ii) Rural development state
directors.--On the request of the
council of a State, the State Director
for Rural Development of the State
shall provide advice and consultation
to the council.
(3) SEARCH grants.--
(A) In general.--Each council shall review
applications for, and recommend awards of,
SEARCH grants to small communities that meet
the eligibility criteria under subsection (c).
(B) Recommendations.--In awarding a SEARCH
grant, a State--
(i) shall follow the recommendations
of the council of the State;
(ii) shall award the funds for any
recommended environmental project in a
timely and expeditious manner; and
(iii) shall not award a SEARCH grant
to a grantee or project in violation of
any law of the State (including a
regulation).
(C) No matching requirement.--A small
community that receives a SEARCH grant under
this section shall not be required to provide
matching funds.
(e) SEARCH Grants for Small Communities.--
(1) Eligibility.--A SEARCH grant shall be awarded
under this section only to a small community for 1 or
more environmental projects for which the small
community--
(A) needs funds to carry out initial
feasibility or environmental studies before
applying to traditional funding sources; or
(B) demonstrates, to the satisfaction of the
council, that the small community has been
unable to obtain sufficient funding from
traditional funding sources.
(2) Application.--
(A) Date.--The council shall establish such
deadline by which small communities shall
submit applications for grants under this
section as will permit the council adequate
time to review and make recommendations
relating to the applications.
(B) Location of application.--A small
community shall submit an application described
in subparagraph (A) to the council in the State
in which the small community is located.
(C) Content of application.--An application
described in subparagraph (A) shall include--
(i) a description of the proposed
environmental project (including an
explanation of how the project would
assist the small community in complying
with an environmental law (including a
regulation));
(ii) an explanation of why the
project is important to the small
community;
(iii) a description of all actions
taken with respect to the project,
including a description of any attempt
to secure funding and a description of
demonstrated need for funding for the
project, as of the date of the
application; and
(iv) a SEARCH grant application form
provided by the council, completed and
with all required supporting
documentation.
(3) Review and recommendation.--
(A) In general.--Except as provided in
subparagraph (B), not later than March 5 of
each fiscal year, each council shall--
(i) review all applications received
under paragraph (2); and
(ii) recommend for award SEARCH
grants to small communities based on--
(I) an evaluation of the
eligibility criteria under
paragraph (1); and
(II) the content of the
application.
(B) Extension of deadline.--The State may
extend the deadline described in subparagraph
(A) by not more than 10 days in a case in which
the receipt of recommendations from a council
under subparagraph (A)(ii) is delayed because
of circumstances beyond the control of the
council, as determined by the State.
(4) Unexpended funds.--
(A) In general.--If, for any fiscal year, any
unexpended funds remain after SEARCH grants are
awarded under subsection (d)(3)(B), the council
may repeat the application and review process
so that any remaining funds may be recommended
for award, and awarded, not later than July 30
of the fiscal year.
(B) Retention of funds.--
(i) In general.--Any unexpended funds
that are not awarded under subsection
(d)(3)(B) or subparagraph (A) shall be
retained by the State for award during
the following fiscal year.
(ii) Limitation.--A State that
accumulates a balance of unexpended
funds described in clause (i) of more
than $3,000,000 shall be ineligible to
apply for additional funds for SEARCH
grants until such time as the State
expends the portion of the balance that
exceeds $3,000,000.
SEC. 386C. REPORT.
Not later than September 1 of the first fiscal year for
which a SEARCH grant is awarded by a council, and annually
thereafter, the council shall submit to the Secretary a report
that--
(1) describes the number of SEARCH grants awarded
during the fiscal year;
(2) identifies each small community that received a
SEARCH grant during the fiscal year;
(3) describes the project or purpose for which each
SEARCH grant was awarded, including a statement of the
benefit to public health or the environment of the
environmental project receiving the grant funds; and
(4) describes the status of each project or portion
of a project for which a SEARCH grant was awarded,
including a project or portion of a project for which a
SEARCH grant was awarded for any fiscal year before the
fiscal year in which the report is submitted.
SEC. 386D. FUNDING.
(a) Authorization of Appropriations.--There is authorized
to be appropriated to carry out section 386B(c) $51,000,000, of
which not to exceed $1,000,000 shall be used to make grants
under section 386B(c)(2).
(b) Actual Appropriation.--If funds to carry out section
386B(c) are made available for a fiscal year in an amount that
is less than the amount authorized under subsection (a) for the
fiscal year, the appropriated funds shall be divided equally
among the 50 States.
(c) Unused Funds.--If, for any fiscal year, a State does
not apply, or does not qualify, to receive funds under section
386B(b), the funds that would have been made available to the
State under section 386B(c) on submission by the State of a
successful application under section 386B(b) shall be
redistributed for award under this subtitle among States, the
councils of which awarded 1 or more SEARCH grants during the
preceding fiscal year.
(d) Other Expenses.--There are authorized to be
appropriated such sums as are necessary to carry out the
provisions of this subtitle (other than section 386B(c)).
Subtitle K--Northern Great Plains Regional Authority
SEC. 387A. DEFINITIONS.
In this subtitle:
(1) Authority.--The term ``Authority'' means the
Northern Great Plains Regional Authority established by
section 387B.
(2) Federal grant program.--The term ``Federal grant
program'' means a Federal grant program to provide
assistance in--
(A) acquiring or developing land;
(B) constructing or equipping a highway,
road, bridge, or facility; or
(C) carrying out other economic development
activities.
(3) Region.--The term ``region'' means the States of
Iowa, Minnesota, Nebraska, North Dakota, and South
Dakota.
SEC. 387B. NORTHERN GREAT PLAINS REGIONAL AUTHORITY.
(a) Establishment.--
(1) In general.--There is established the Northern
Great Plains Regional Authority.
(2) Composition.--The Authority shall be composed
of--
(A) a Federal member, to be appointed by the
President, with the advice and consent of the
Senate; and
(B) the Governor (or a designee of the
Governor) of each State in the region that
elects to participate in the Authority.
(3) Cochairpersons.--The Authority shall be headed
by--
(A) the Federal member, who shall serve--
(i) as the Federal cochairperson; and
(ii) as a liaison between the Federal
Government and the Authority; and
(B) a State cochairperson, who--
(i) shall be a Governor of a
participating State in the region; and
(ii) shall be elected by the State
members for a term of not less than 1
year.
(b) Alternate Members.--
(1) State alternates.--The State member of a
participating State may have a single alternate, who
shall be--
(A) a resident of that State; and
(B) appointed by the Governor of the State.
(2) Alternate federal cochairperson.--The President
shall appoint an alternate Federal cochairperson.
(3) Quorum.--A State alternate shall not be counted
toward the establishment of a quorum of the Authority
in any instance in which a quorum of the State members
is required to be present.
(4) Delegation of power.--No power or responsibility
of the Authority specified in paragraphs (2) and (3) of
subsection (c), and no voting right of any Authority
member, shall be delegated to any person--
(A) who is not an Authority member; or
(B) who is not entitled to vote in Authority
meetings.
(c) Voting.--
(1) In general.--A decision by the Authority shall
require a majority vote of the Authority (not including
any member representing a State that is delinquent
under subsection (g)(2)(C)) to be effective.
(2) Quorum.--A quorum of State members shall be
required to be present for the Authority to make any
policy decision, including--
(A) a modification or revision of an
Authority policy decision;
(B) approval of a State or regional
development plan; and
(C) any allocation of funds among the States.
(3) Project and grant proposals.--The approval of
project and grant proposals shall be--
(A) a responsibility of the Authority; and
(B) conducted in accordance with section
387I.
(4) Voting by alternate members.--An alternate member
shall vote in the case of the absence, death,
disability, removal, or resignation of the Federal or
State representative for which the alternate member is
an alternate.
(d) Duties.--The Authority shall--
(1) develop, on a continuing basis, comprehensive and
coordinated plans and programs to establish priorities
and approve grants for the economic development of the
region, giving due consideration to other Federal,
State, and local planning and development activities in
the region;
(2) not later than 220 days after the date of
enactment of this subtitle, establish priorities in a
development plan for the region (including 5-year
regional outcome targets);
(3) assess the needs and assets of the region based
on available research, demonstrations, investigations,
assessments, and evaluations of the region prepared by
Federal, State, and local agencies, universities, local
development districts, and other nonprofit groups;
(4) formulate and recommend to the Governors and
legislatures of States that participate in the
Authority forms of interstate cooperation;
(5) work with State and local agencies in developing
appropriate model legislation;
(6)(A) enhance the capacity of, and provide support
for, local development districts in the region; or
(B) if no local development district exists in an
area in a participating State in the region, foster the
creation of a local development district;
(7) encourage private investment in industrial,
commercial, and other economic development projects in
the region; and
(8) cooperate with and assist State governments with
economic development programs of participating States.
(e) Administration.--In carrying out subsection (d), the
Authority may--
(1) hold such hearings, sit and act at such times and
places, take such testimony, receive such evidence, and
print or otherwise reproduce and distribute a
description of the proceedings and reports on actions
by the Authority as the Authority considers
appropriate;
(2) authorize, through the Federal or State
cochairperson or any other member of the Authority
designated by the Authority, the administration of
oaths if the Authority determines that testimony should
be taken or evidence received under oath;
(3) request from any Federal, State, or local
department or agency such information as may be
available to or procurable by the department or agency
that may be of use to the Authority in carrying out
duties of the Authority;
(4) adopt, amend, and repeal bylaws and rules
governing the conduct of Authority business and the
performance of Authority duties;
(5) request the head of any Federal department or
agency to detail to the Authority such personnel as the
Authority requires to carry out duties of the
Authority, each such detail to be without loss of
seniority, pay, or other employee status;
(6) request the head of any State department or
agency or local government to detail to the Authority
such personnel as the Authority requires to carry out
duties of the Authority, each such detail to be without
loss of seniority, pay, or other employee status;
(7) provide for coverage of Authority employees in a
suitable retirement and employee benefit system by--
(A) making arrangements or entering into
contracts with any participating State
government; or
(B) otherwise providing retirement and other
employee benefit coverage;
(8) accept, use, and dispose of gifts or donations of
services or real, personal, tangible, or intangible
property;
(9) enter into and perform such contracts, leases,
cooperative agreements, or other transactions as are
necessary to carry out Authority duties, including any
contracts, leases, or cooperative agreements with--
(A) any department, agency, or
instrumentality of the United States;
(B) any State (including a political
subdivision, agency, or instrumentality of the
State); or
(C) any person, firm, association, or
corporation; and
(10) establish and maintain a central office and
field offices at such locations as the Authority may
select.
(f) Federal Agency Cooperation.--A Federal agency shall--
(1) cooperate with the Authority; and
(2) provide, on request of the Federal cochairperson,
appropriate assistance in carrying out this subtitle,
in accordance with applicable Federal laws (including
regulations).
(g) Administrative Expenses.--
(1) In general.--Administrative expenses of the
Authority (except for the expenses of the Federal
cochairperson, including expenses of the alternate and
staff of the Federal cochairperson, which shall be paid
solely by the Federal Government) shall be paid--
(A) by the Federal Government, in an amount
equal to 50 percent of the administrative
expenses; and
(B) by the States in the region participating
in the Authority, in an amount equal to 50
percent of the administrative expenses.
(2) State share.--
(A) In general.--The share of administrative
expenses of the Authority to be paid by each
State shall be determined by the Authority.
(B) No federal participation.--The Federal
cochairperson shall not participate or vote in
any decision under subparagraph (A).
(C) Delinquent states.--If a State is
delinquent in payment of the State's share of
administrative expenses of the Authority under
this subsection--
(i) no assistance under this subtitle
shall be furnished to the State
(including assistance to a political
subdivision or a resident of the
State); and
(ii) no member of the Authority from
the State shall participate or vote in
any action by the Authority.
(h) Compensation.--
(1) Federal cochairperson.--The Federal cochairperson
shall be compensated by the Federal Government at level
III of the Executive Schedule in subchapter II of
chapter 53 of title 5, UnitedStates Code.
(2) Alternate federal cochairperson.--The alternate
Federal cochairperson--
(A) shall be compensated by the Federal
Government at level V of the Executive Schedule
described in paragraph (1); and
(B) when not actively serving as an alternate
for the Federal cochairperson, shall perform
such functions and duties as are delegated by
the Federal cochairperson.
(3) State members and alternates.--
(A) In general.--A State shall compensate
each member and alternate representing the
State on the Authority at the rate established
by law of the State.
(B) No additional compensation.--No State
member or alternate member shall receive any
salary, or any contribution to or
supplementation of salary from any source other
than the State for services provided by the
member or alternate to the Authority.
(4) Detailed employees.--
(A) In general.--No person detailed to serve
the Authority under subsection (e)(6) shall
receive any salary or any contribution to or
supplementation of salary for services provided
to the Authority from--
(i) any source other than the State,
local, or intergovernmental department
or agency from which the person was
detailed; or
(ii) the Authority.
(B) Violation.--Any person that violates this
paragraph shall be fined not more than $5,000,
imprisoned not more than 1 year, or both.
(C) Applicable law.--The Federal
cochairperson, the alternate Federal
cochairperson, and any Federal officer or
employee detailed to duty on the Authority
under subsection (e)(5) shall not be subject to
subparagraph (A), but shall remain subject to
sections 202 through 209 of title 18, United
States Code.
(5) Additional personnel.--
(A) Compensation.--
(i) In general.--The Authority may
appoint and fix the compensation of an
executive director and such other
personnel as are necessary to enable
the Authority to carry out the duties
of the Authority.
(ii) Exception.--Compensation under
clause (i) shall not exceed the maximum
rate for the Senior Executive Service
under section 5382 of title 5, United
States Code, including any applicable
locality-based comparability payment
that may be authorized under section
5304(h)(2)(C) of that title.
(B) Executive director.--The executive
director shall be responsible for--
(i) the carrying out of the
administrative duties of the Authority;
(ii) direction of the Authority
staff; and
(iii) such other duties as the
Authority may assign.
(C) No federal employee status.--No member,
alternate, officer, or employee of the
Authority (except the Federal cochairperson of
the Authority, the alternate and staff for the
Federal cochairperson, and any Federal employee
detailed to the Authority under subsection
(e)(5)) shall be considered to be a Federal
employee for any purpose.
(i) Conflicts of Interest.--
(1) In general.--Except as provided under paragraph
(2), no State member, alternate, officer, or employee
of the Authority shall participate personally and
substantially as a member, alternate, officer, or
employee of the Authority, through decision, approval,
disapproval, recommendation, the rendering of advice,
investigation, or otherwise, in any proceeding,
application, request for a ruling or other
determination, contract, claim, controversy, or other
matter in which, to knowledge of the member, alternate,
officer, or employee--
(A) the member, alternate, officer, or
employee;
(B) the spouse, minor child, partner, or
organization (other than a State or political
subdivision of the State) of the member,
alternate, officer, or employee, in which the
member, alternate, officer, or employee is
serving as officer, director, trustee, partner,
or employee; or
(C) any person or organization with whom the
member, alternate, officer, or employee is
negotiating or has any arrangement concerning
prospective employment;
has a financial interest.
(2) Disclosure.--Paragraph (1) shall not apply if the
State member, alternate, officer, or employee--
(A) immediately advises the Authority of the
nature and circumstances of the proceeding,
application, request for a ruling or other
determination, contract, claim, controversy, or
other particular matter presenting a potential
conflict of interest;
(B) makes full disclosure of the financial
interest; and
(C) before the proceeding concerning the
matter presenting the conflict of interest,
receives a written determination by the
Authority that the interest is not so
substantial as to be likely to affect the
integrity of the services that the Authority
may expect from the State member, alternate,
officer, or employee.
(3) Violation.--Any person that violates this
subsection shall be fined not more than $10,000,
imprisoned not more than 2 years, or both.
(j) Validity of Contracts, Loans, and Grants.--The
Authority may declare void any contract, loan, or grant of or
by the Authority in relation to which the Authority determines
that there has been a violation of any provision under
subsection (h)(4), subsection (i), or sections 202 through 209
of title 18, United States Code.
SEC. 387C. ECONOMIC AND COMMUNITY DEVELOPMENT GRANTS.
(a) In General.--The Authority may approve grants to
States, local governments, and public and nonprofit
organizations for projects, approved in accordance with section
387I--
(1) to develop the transportation and
telecommunication infrastructure of the region for the
purpose of facilitating economic development in the
region (except that grants for this purpose may only be
made to States, local governments, and nonprofit
organizations);
(2) to assist the region in obtaining the job
training, employment-related education, and business
development (with an emphasis on entrepreneurship) that
are needed to build and maintain strong local
economies;
(3) to provide assistance to severely distressed and
underdeveloped areas that lack financial resources for
improving basic public services;
(4) to provide assistance to severely distressed and
underdeveloped areas that lack financial resources for
equipping industrial parks and related facilities; and
(5) to otherwise achieve the purposes of this
subtitle.
(b) Funding.--
(1) In general.--Funds for grants under subsection
(a) may be provided--
(A) entirely from appropriations to carry out
this section;
(B) in combination with funds available under
another Federal or Federal grant program; or
(C) from any other source.
(2) Priority of funding.--To best build the
foundations for long-term economic development and to
complement other Federal and State resources in the
region, Federal funds available under this subtitle
shall be focused on the activities in the following
order or priority:
(A) Basic public infrastructure in distressed
counties and isolated areas of distress.
(B) Transportation and telecommunication
infrastructure for the purpose of facilitating
economic development in the region.
(C) Business development, with emphasis on
entrepreneurship.
(D) Job training or employment-related
education, with emphasis on use of existing
public educational institutions located in the
region.
(3) Federal share in grant programs.--Notwithstanding
any provision of law limiting the Federal share in any
grant program, funds appropriated to carry out this
section may be used to increase a Federal share in a
grant program, as the Authority determines appropriate.
SEC. 387D. SUPPLEMENTS TO FEDERAL GRANT PROGRAMS.
(a) Finding.--Congress finds that certain States and local
communities of the region, including local development
districts, may be unable to take maximum advantage of Federal
grant programs for which the States and communities are
eligible because--
(1) they lack the economic resources to meet the
required matching share; or
(2) there are insufficient funds available under the
applicable Federal grant law authorizing the program to
meet pressing needs of the region.
(b) Federal Grant Program Funding.--In accordance with
subsection (c), the Federal cochairperson may use amounts made
available to carry out this subtitle, without regard to any
limitations on areas eligible for assistance or authorizations
for appropriation under any other Act, to fund all or any
portion of the basic Federal contribution to a project or
activity under a Federal grant program in the region in an
amount that is above the fixed maximum portion of the cost of
the project otherwise authorized by applicable law, but not to
exceed 90 percent of the costs of the project (except as
provided in section 387F(b)).
(c) Certification.--
(1) In general.--In the case of any program or
project for which all or any portion of the basic
Federal contribution to the project under a Federal
grant program is proposed to be made under this
section, no Federal contribution shall be made until
the Federal official administering the Federal law
authorizing the contribution certifies that the program
or project--
(A) meets the applicable requirements of the
applicable Federal grant law; and
(B) could be approved for Federal
contribution under the law if funds were
available under the law for the program or
project.
(2) Certification by authority.--
(A) In general.--The certifications and
determinations required to be made by the
Authority for approval of projects under this
subtitle in accordance with section 387I--
(i) shall be controlling; and
(ii) shall be accepted by the Federal
agencies.
(B) Acceptance by federal cochairperson.--Any
finding, report, certification, or
documentation required to be submitted to the
head of the department, agency, or
instrumentality of the Federal Government
responsible for the administration of any
Federal grant program shall be accepted by the
Federal cochairperson with respect to a
supplemental grant for any project under the
program.
SEC. 387E. LOCAL DEVELOPMENT DISTRICTS; CERTIFICATION AND
ADMINISTRATIVE EXPENSES.
(a) Definition of Local Development District.--In this
section, the term ``local development district'' means an
entity that--
(1) is--
(A) a planning district in existence on the
date of enactment of this subtitle that is
recognized by the Economic Development
Administration of the Department of Commerce;
or
(B) where an entity described in subparagraph
(A) does not exist--
(i) organized and operated in a
manner that ensures broad-based
community participation and an
effective opportunity for other
nonprofit groups to contribute to the
development and implementation of
programs in the region;
(ii) governed by a policy board with
at least a simple majority of members
consisting of elected officials or
employees of a general purpose unit of
local government who have been
appointed to represent the government;
(iii) certified to the Authority as
having a charter or authority that
includes the economic development of
counties or parts of counties or other
political subdivisions within the
region--
(I) by the Governor of each
State in which the entity is
located; or
(II) by the State officer
designated by the appropriate
State law to make the
certification; and
(iv)(I) a nonprofit incorporated body
organized or chartered under the law of
the State in which the entity is
located;
(II) a nonprofit agency or
instrumentality of a State or local
government;
(III) a public organization
established before the date of
enactment of this subtitle under State
law for creation of multi-
jurisdictional, area-wide planning
organizations; or
(IV) a nonprofit association or
combination of bodies, agencies, and
instrumentalities described in
subclauses (I) through (III); and
(2) has not, as certified by the Federal
cochairperson--
(A) inappropriately used Federal grant funds
from any Federal source; or
(B) appointed an officer who, during the
period in which another entity inappropriately
used Federal grant funds from any Federal
source, was an officer of the other entity.
(b) Grants to Local Development Districts.--
(1) In general.--The Authority may make grants for
administrative expenses under this section.
(2) Conditions for grants.--
(A) Maximum amount.--The amount of any grant
awarded under paragraph (1) shall not exceed 80
percent of the administrative expenses of the
local development district receiving the grant.
(B) Maximum period.--No grant described in
paragraph (1) shall be awarded to a State
agency certified as a local development
district for a period greater than 3 years.
(C) Local share.--The contributions of a
local development district for administrative
expenses may be in cash or in kind, fairly
evaluated, including space, equipment, and services.
(c) Duties of Local Development Districts.--A local
development district shall--
(1) operate as a lead organization serving
multicounty areas in the region at the local level; and
(2) serve as a liaison between State and local
governments, nonprofit organizations (including
community-based groups and educational institutions),
the business community, and citizens that--
(A) are involved in multijurisdictional
planning;
(B) provide technical assistance to local
jurisdictions and potential grantees; and
(C) provide leadership and civic development
assistance.
SEC. 387F. DISTRESSED COUNTIES AND AREAS AND NONDISTRESSED COUNTIES.
(a) Designations.--Not later than 90 days after the date of
enactment of this subtitle, and annually thereafter, the
Authority, in accordance with such criteria as the Authority
may establish, shall designate--
(1) as distressed counties, counties in the region
that are the most severely and persistently distressed
and underdeveloped and have high rates of poverty,
unemployment, or outmigration;
(2) as nondistressed counties, counties in the region
that are not designated as distressed counties under
paragraph (1); and
(3) as isolated areas of distress, areas located in
nondistressed counties (as designated under paragraph
(2)) that have high rates of poverty, unemployment, or
outmigration.
(b) Distressed Counties.--
(1) In general.--The Authority shall allocate at
least 75 percent of the appropriations made available
under section 387M for programs and projects designed
to serve the needs of distressed counties and isolated
areas of distress in the region.
(2) Funding limitations.--The funding limitations
under section 387D(b) shall not apply to a project
providing transportation or telecommunication or basic
public services to residents of 1 or more distressed
counties or isolated areas of distress in the region.
(c) Nondistressed Counties.--
(1) In general.--Except as provided in this
subsection, no funds shall be provided under this
subtitle for a project located in a county designated
as a nondistressed county under subsection (a)(2).
(2) Exceptions.--
(A) In general.--The funding prohibition
under paragraph (1) shall not apply to grants
to fund the administrative expenses of local
development districts under section 387E(b).
(B) Multicounty projects.--The Authority may
waive the application of the funding
prohibition under paragraph (1) to--
(i) a multicounty project that
includes participation by a
nondistressed county; or
(ii) any other type of project;
if the Authority determines that the project
could bring significant benefits to areas of
the region outside a nondistressed county.
(C) Isolated areas of distress.--For a
designation of an isolated area of distress for
assistance to be effective, the designation
shall be supported--
(i) by the most recent Federal data
available; or
(ii) if no recent Federal data are
available, by the most recent data
available through the government of the
State in which the isolated area of
distress is located.
(d) Transportation, Telecommunication, and Basic Public
Infrastructure.--The Authority shall allocate at least 50
percent of any funds made available under section 387M for
transportation, telecommunication, and basic public
infrastructure projects authorized under paragraphs (1) and (3)
of section 387C(a).
SEC. 387G. DEVELOPMENT PLANNING PROCESS.
(a) State Development Plan.--In accordance with policies
established by the Authority, each State member shall submit a
development plan for the area of the region represented by the
State member.
(b) Content of Plan.--A State development plan submitted
under subsection (a) shall reflect the goals, objectives, and
priorities identified in the regional development plan
developed under section 387B(d)(2).
(c) Consultation With Interested Local Parties.--In
carrying out the development planningprocess (including the
selection of programs and projects for assistance), a State may--
(1) consult with--
(A) local development districts; and
(B) local units of government; and
(2) take into consideration the goals, objectives,
priorities, and recommendations of the entities
described in paragraph (1).
(d) Public Participation.--
(1) In general.--The Authority and applicable State
and local development districts shall encourage and
assist, to the maximum extent practicable, public
participation in the development, revision, and
implementation of all plans and programs under this
subtitle.
(2) Regulations.--The Authority shall develop
guidelines for providing public participation described
in paragraph (1), including public hearings.
SEC. 387H. PROGRAM DEVELOPMENT CRITERIA.
(a) In General.--In considering programs and projects to be
provided assistance under this subtitle, and in establishing a
priority ranking of the requests for assistance provided by the
Authority, the Authority shall follow procedures that ensure,
to the maximum extent practicable, consideration of--
(1) the relationship of the project or class of
projects to overall regional development;
(2) the per capita income and poverty and
unemployment and outmigration rates in an area;
(3) the financial resources available to the
applicants for assistance seeking to carry out the
project, with emphasis on ensuring that projects are
adequately financed to maximize the probability of
successful economic development;
(4) the importance of the project or class of
projects in relation to other projects or classes of
projects that may be in competition for the same funds;
(5) the prospects that the project for which
assistance is sought will improve, on a continuing
rather than a temporary basis, the opportunities for
employment, the average level of income, or the
economic development of the area served by the project;
and
(6) the extent to which the project design provides
for detailed outcome measurements by which grant
expenditures and the results of the expenditures may be
evaluated.
(b) No Relocation Assistance.--No financial assistance
authorized by this subtitle shall be used to assist a person or
entity in relocating from one area to another, except that
financial assistance may be used as otherwise authorized by
this title to attract businesses from outside the region to the
region.
(c) Reduction of Funds.--Funds may be provided for a
program or project in a State under this subtitle only if the
Authority determines that the level of Federal or State
financial assistance provided under a law other than this
subtitle, for the same type of program or project in the same
area of the State within the region, will not be reduced as a
result of funds made available by this subtitle.
SEC. 387I. APPROVAL OF DEVELOPMENT PLANS AND PROJECTS.
(a) In General.--A State or regional development plan or
any multistate subregional plan that is proposed for
development under this subtitle shall be reviewed by the
Authority.
(b) Evaluation by State Member.--An application for a grant
or any other assistance for a project under this subtitle shall
be made through and evaluated for approval by the State member
of the Authority representing the applicant.
(c) Certification.--An application for a grant or other
assistance for a project shall be approved only on
certification by the State member that the application for the
project--
(1) describes ways in which the project complies with
any applicable State development plan;
(2) meets applicable criteria under section 387H;
(3) provides adequate assurance that the proposed
project will be properly administered, operated, and
maintained; and
(4) otherwise meets the requirements of this
subtitle.
(d) Votes for Decisions.--On certification by a State
member of the Authority of an application for a grant or other
assistance for a specific project under this section, an
affirmative vote of the Authority under section 387B(c) shall
be required for approval of the application.
SEC. 387J. CONSENT OF STATES.
Nothing in this subtitle requires any State to engage in or
accept any program under this subtitle without the consent of
the State.
SEC. 387K. RECORDS.
(a) Records of the Authority.--
(1) In general.--The Authority shall maintain
accurate and complete records of all transactions and
activities of the Authority.
(2) Availability.--All records of the Authority shall
be available for audit and examination by the
Comptroller General of the United States and the
Inspector General of the Department of Agriculture
(including authorized representatives of the
Comptroller General and the Inspector General of the
Department of Agriculture).
(b) Records of Recipients of Federal Assistance.--
(1) In general.--A recipient of Federal funds under
this subtitle shall, as required by the Authority,
maintain accurate and complete records of transactions
and activities financed with Federal funds and report
on the transactions and activities to the Authority.
(2) Availability.--All records required under
paragraph (1) shall be available for audit by the
Comptroller General of the United States, the Inspector
General of the Department of Agriculture, and the
Authority (including authorized representatives of the
Comptroller General, the Inspector General of the
Department of Agriculture, and the Authority).
(c) Annual Audit.--The Inspector General of the Department
of Agriculture shall audit the activities, transactions, and
records of the Authority on an annual basis.
SEC. 387L. ANNUAL REPORT.
Not later than 180 days after the end of each fiscal year,
the Authority shall submit to the President and to Congress a
report describing the activities carried out under this
subtitle.
SEC. 387M. AUTHORIZATION OF APPROPRIATIONS.
(a) In General.--There is authorized to be appropriated to
the Authority to carry out this subtitle $30,000,000 for each
of fiscal years 2002 through 2006, to remain available until
expended.
(b) Administrative Expenses.--Not more than 5 percent of
the amount appropriated under subsection (a) for a fiscal year
shall be used for administrative expenses of the Authority.
(c) Minimum State Share of Grants.--Notwithstanding any
other provision of this subtitle, for any fiscal year, the
aggregate amount of grants received by a State and all persons
or entities in the State under this subtitle shall be not less
than \1/3\ of the product obtained by multiplying--
(1) the aggregate amount of grants under this
subtitle for the fiscal year; and
(2) the ratio that--
(A) the population of the State (as
determined by the Secretary of Commerce based
on the most recent decennial census for which
data are available); bears to
(B) the population of the region (as so
determined).
SEC. 387N. TERMINATION OF AUTHORITY.
This subtitle and the authority provided under this
subtitle expire on October 1, 2006.''.
* * * * * * *
RURAL ECONOMIC DEVELOPMENT ACT OF 1990
* * * * * * *
CHAPTER 5--EFFECTIVE DATE
SEC. 2368. EFFECTIVE DATE.
(a) In General.--Except as provided in subsection (b), this
subtitle and the amendments made by this subtitle shall take
effect on the date of enactment of this Act.
(b) Technical Amendments.--The amendments made by section
2367 shall take effect as if such amendments had been included
in chapter 2 of subtitle D of title I of the Omnibus Budget
Reconciliation Act of 1987 on the date of enactment of such
chapter.
[Subtitle G--Rural Revitalization Through Forestry
[CHAPTER 1--FORESTRY RURAL REVITALIZATION
[SEC. 2371. FORESTRY RURAL REVITALIZATION.
[(a) Establishment of Economic Development and Global
Marketing Program.--The Secretaryof Agriculture, acting through
the Extension Service and the Cooperative Extension System, and in
consultation with the Forest Service, shall establish and implement
educational programs and provide technical assistance to assist
businesses, industries, and policymakers to create jobs, raise incomes,
and increase public revenues in manners consistent with environmental
concerns.
[(b) Activities.--Each program established under subsection
(a) shall--
[(1) transfer technologies to natural resource-based
industries in the United States to make such industries
more efficient, productive, and competitive;
[(2) assist businesses to identify global marketing
opportunities, conduct business on an international
basis, and market themselves more effectively; and
[(3) train local leaders in strategic community
economic development.
[(c) Types of Programs.--The Secretary of Agriculture shall
establish specific programs under subsection (a) to--
[(1) deliver educational services focused on
community economic analysis, economic diversification,
economic impact analysis, retention and expansion of
existing commodity and noncommodity industries, amenity
resource and tourism development, and entrepreneurship
focusing on forest lands and rural communities;
[(2) use Cooperative Extension System databases and
analytical tools to help communities diversify their
economic bases, add value locally to raw forest product
materials, and retain revenues by helping to develop
local businesses and industries to supply forest
products locally; and
[(3) use the full resources of the Cooperative
Extension Service, including land-grant universities
and county offices, to promote economic development
that is sustainable and environmentally sound.
[CHAPTER 2--NATIONAL FOREST-DEPENDENT RURAL COMMUNITIES
[SEC. 2372. SHORT TITLE.
[This chapter may be cited as the ``National Forest-
Dependent Rural Communities Economic Diversification Act of
1990''.
[SEC. 2373. FINDINGS AND PURPOSES.
[(a) Findings.--The Congress finds that--
[(1) the economic well-being of rural America is
vital to our national growth and prosperity;
[(2) the economic well-being of many rural
communities depends upon the goods and services that
are derived from national forests;
[(3) the economies of many of these communities
suffer from a lack of industrial and business
diversity;
[(4) this lack of diversity is particularly serious
in communities whose economies are predominantly
dependent on timber and recreation resources and where
management decisions made on the national forests by
Federal and private organizations may disrupt the
supply of those resources;
[(5) the Forest Service has expertise and resources
that could be directed to promote modernization and
economic diversification of existing industries and
services based on forest resources;
[(6) the Forest Service has the technical expertise
to provide leadership, in cooperation with other
governmental agencies and the private sector, to assist
rural communities dependent upon national forest
resources to upgrade existing industries and diversify
by developing new economic activity in non-forest-
related industries; and
[(7) technical assistance, training, education, and
other assistance provided by the Department of
Agriculture can be targeted to provide immediate help
to those rural communities in greatest need.
[(b) Purposes.--The purposes of this chapter are--
[(1) to provide assistance to rural communities that
are located in or near national forests and that are
economically dependent upon forest resources or are
likely to be economically disadvantaged by Federal or
private sector land management practices;
[(2) to aid in diversifying such communities'
economic bases; and
[(3) to improve the economic, social, and
environmental well-being of rural America.
[SEC. 2374. DEFINITIONS.
[As used in this chapter:
[(1) The term ``action team'' means a rural forestry
and economic diversification action team established by
the Secretary pursuant to section 2375(b).
[(2) The term ``economically disadvantaged'' means
economic hardship due to the loss of jobs or income
(labor or proprietor) derived from forestry, the wood
products industry, or related commercial enterprises
such as recreation and tourism in the national forest.
[(3) The term ``rural community'' means--
[(A) any town, township, municipality, or
other similar unit of general purpose local
government having a population of not more than
10,000 individuals (according to the latest
decennial census) that is located in a county
where at least 15 percent of the total primary
and secondary labor and proprietor income is
derived from forestry, wood products, and
forest-related industries such as recreation
and tourism; or
[(B) any county or similar unit of general
purpose local government having a population of
not more than 22,550 individuals (according to
the latest decennial census) in which at least
15 percent of the total primary and secondary
labor and proprietor income is derived from
forestry, wood products, and forest-related
industries such as recreation and tourism,
that is located within the boundary, or within 100
miles of the boundary, of a national forest.
[(4) The term ``Secretary'' means the Secretary of
Agriculture.
[SEC. 2375. RURAL FORESTRY AND ECONOMIC DIVERSIFICATION ACTION TEAMS.
[(a) Requests for Assistance.--Economically disadvantaged
rural communities may request assistance from the Secretary in
identifying opportunities that will promote economic
improvement and diversification and revitalization.
[(b) Establishment.--Upon request, the Secretary may
establish rural forestry and economic diversification action
teams to prepare an action plan to provide technical assistance
to economically disadvantaged communities. The action plan
shall identify opportunities to promote economic
diversification and enhance local economies now dependent upon
national forest resources. The action team may also identify
opportunities to use value-added products and services derived
from national forest resources.
[(c) Organization.--The Secretary shall design and organize
any action team established pursuant to subsection (b) to meet
the unique needs of the requesting rural community. Each action
team shall be directed by an employee of the Forest Service and
may include personnel from other agencies within the Department
of Agriculture, from other Federal and State departments and
agencies, and from the private sector.
[(d) Cooperation.--In preparing action plans, the Secretary
may cooperate with State and local governments, universities,
private companies, individuals, and nonprofit organizations for
procurement of services determined necessary or desirable.
[(e) Eligibility.--The Secretary shall ensure that no
substantially similar geographical or defined local area in a
State receives a grant for technical assistance to an
economically disadvantaged community under this chapter and a
grant for assistance under a designated rural development
program, as defined in section 365(b)(2) of the Consolidated
Farm and Rural Development Act, during any continuous five-year
period.
[(f) Approval.--After reviewing requests under this section
for financial and economic feasibility and viability, the
Secretary shall approve and implement in accordance with
section 2376 those action plans that will achieve the purposes
of this chapter.
[SEC. 2376. ACTION PLAN IMPLEMENTATION.
[(a) In General.--Action plans shall be implemented,
insofar as practicable, to upgrade existing industries to use
forest resources more efficiently and to expand the economic
base of rural communities so as to alleviate or reduce their
dependence on national forest resources.
[(b) Assistance.--To implement action plans, the Secretary
may make grants and enter into cooperative agreements and
contracts to provide necessary technical and related
assistance. Such grants, cooperative agreements, and contracts
may be with the affected rural community, State and local
governments, universities, corporations, and other persons.
[(c) Limitation.--The Federal contribution to the overall
implementation of an action plan shall not exceed 80 percent of
the total cost of the plan, including administrative and other
costs. In calculating the Federal contribution, the Secretary
shall take into account the fair market value of equipment,
personnel, and services provided.
[(d) Available Authority.--The Secretary may use the
Secretary's authority under the Cooperative Forestry Assistance
Act of 1978 (16 U.S.C. 2101 et seq.) and other Federal, State,
and local governmental authorities in implementing action
plans.
[(e) Consistency With Forest Plans.--The implementation of
action plans shall be consistent with land and resource
management plans.
[SEC. 2377. TRAINING AND EDUCATION.
[(a) Programs.--In furtherance of an action plan, the
Secretary may use the Extension Service and other appropriate
agencies of the Department of Agriculture to develop and
conduct education programs that assist businesses, elected or
appointed officials, and individuals in rural communities to
deal with the effects of a transition from being economically
disadvantaged to economic diversification. These programs may
include--
[(1) community economic analysis and strategic
planning;
[(2) methods for improving and retooling enterprises
now dependent on national forest resources;
[(3) methods for expanding enterprises and creating
new economic opportunities by emphasizing economic
opportunities in other industries or services not
dependent on national forest resources; and
[(4) assistance in the evaluation, counseling, and
enhancement of vocational skills, training in basic and
remedial literacy skills, assistance in job seeking
skills, and training in starting or operating a
business enterprise.
[(b) Existing Educational and Training Programs.--Insofar
as practicable, the Secretary shall use existing Federal,
State, and private education resources in carrying out these
programs.
[SEC. 2378. LOANS TO ECONOMICALLY DISADVANTAGED RURAL COMMUNITIES.
[(a) In General.--The Secretary, under such terms and
conditions as the Secretary shall establish, may make loans to
economically disadvantaged rural communities for the purposes
of securing technical assistance and services to aid in the
development and implementation of action plans, including
planning for--
[(1) improving existing facilities in the community
that may generate employment or revenue;
[(2) expanding existing infrastructure, facilities,
and services to capitalize on opportunities to
diversify economies now dependent on national forest
resources; and
[(3) supporting the development of new industries or
commercial ventures unrelated to national forest
resources.
[(b) Interest Rates.--The interest rates on a loan made
pursuant to this section shall be as determined by the
Secretary, but not in excess of the current average market
yield on outstanding marketable obligations of the United
States with remaining periods to maturity comparable to the
maturity of such loan, plus not to exceed 1 percent, as
determined by the Secretary, and rounded to the nearest one-
eighth of 1 percent.
[SEC. 2379. AUTHORIZATION OF APPROPRIATIONS AND SPENDING AUTHORITY.
[(a) Authorization of Appropriations.--Except as provided
in subsection (b), there are authorized to be appropriated--
[(1) an amount not to exceed 5 percent of the sum
of--
[(A) the sums received by the Secretary from
sales of timber and other products of the
forests; and
[(B) user fees paid in connection with the
use of forest lands; and
[(2) such additional sums as may be necessary to
carry out the purposes of this chapter.
[(b) Limitation on Authorization.--Subsection (a) shall not
in any way affect payments to the States pursuant to chapter
192 of the Act of May 23, 1908 (16 U.S.C. 500).
[(c) Spending Authority.--Any spending authority (as
defined in section 401 of the Congressional Budget Act of 1974)
provided in this chapter shall be effective for any fiscal year
only to such extent or in such amounts as are provided in
appropriation Acts.]
Subtitle H--Miscellaneous Provisions
[SEC. 2381. NATIONAL RURAL INFORMATION CENTER CLEARINGHOUSE.
[(a) Establishment.--The Secretary shall establish, within
the National Agricultural Library, in coordination with the
Extension Service, a National Rural Information Center
Clearinghouse (in this section referred to as the
``Clearinghouse'') to perform the functions specified in
subsection (b).
[(b) Functions.--The Clearinghouse shall provide and
distribute information and data to any industry, organization,
or Federal, State, or local government entity, on request,
about programs and services provided by Federal, State, and
local agencies and private nonprofit organizations and
institutions under which individuals residing in, or
organizations and State and local government entities operating
in, a rural area may be eligible for any kind of assistance,
including job training, education, health care, and economic
development assistance, and emotional and financial counseling.
To the extent possible, the National Agricultural Library shall
use telecommunications technology to disseminate information to
rural areas.
[(c) Federal Agencies.--On request of the Secretary, the
head of a Federal agency shall provide to the Clearinghouse
such information as the Secretary may request to enable the
Clearinghouse to carry out subsection (b).
[(d) State and Local Agencies and Nonprofit
Organizations.--The Secretary shall request State and local
governments and private nonprofit organizations and
institutions to provide to the Clearinghouse such information
as such agencies and organizations may have about any program
or service of such agencies, organizations, and institutions
under which individuals residing in arural area may be eligible
for any kind of assistance, including job training, educational, health
care, and economic development assistance, and emotional and financial
counseling.
[(e) Limitation on Authorization of Appropriations.--To
carry out this section, there are authorized to be appropriated
$500,000 for each of the fiscal years 1991 through 1995.]
SEC. 2381. NATIONAL RURAL DEVELOPMENT INFORMATION CLEARINGHOUSE.
(a) Establishment.--The Secretary shall establish and
maintain, within the rural development mission area of the
Department of Agriculture, a National Rural Development
Information Clearinghouse (referred to in this section as the
``Clearinghouse'') to perform the functions specified in
subsection (b).
(b) Functions.--The Clearinghouse shall collect information
and data from, and disseminate information and data to, any
person or public or private entity about programs and services
provided by Federal, State, local, and tribal agencies,
institutions of higher education, and private, for-profit and
nonprofit organizations and institutions under which a person
or public or private entity residing or operating in a rural
area may be eligible for any kind of financial, technical, or
other assistance, including business, venture capital,
economic, credit and community development assistance, health
care, job training, education, and emotional and financial
counseling.
(c) Modes of Collection and Dissemination of Information.--
In addition to other modes for the collection and dissemination
of the types of information and data specified under subsection
(b), the Secretary shall ensure that the Clearinghouse
maintains an Internet website that provides for dissemination
and collection, through voluntary submission or posting, of the
information and data.
(d) Federal Agencies.--On request of the Secretary and to
the extent permitted by law, the head of a Federal agency shall
provide to the Clearinghouse such information as the Secretary
may request to enable the Clearinghouse to carry out this
section.
(e) State, Local, and Tribal Agencies, Institutions of
Higher Education, and Nonprofit and For-Profit Organizations.--
The Secretary shall request State, local, and tribal agencies,
institutions of higher education, and private, for-profit, and
nonprofit organizations and institutions to provide to the
Clearinghouse information concerning applicable programs or
services described in subsection (b).
(f) Promotion of Clearinghouse.--The Secretary prominently
shall promote the existence and availability of the
Clearinghouse in all activities of the Department of
Agriculture relating to rural areas of the United States.
(g) Funding.--
(1) In general.--Subject to paragraph (2), the
Secretary shall use to operate and maintain the
Clearinghouse not more than $600,000 of the funds
available to the Rural Housing Service, the Rural
Utilities Service, and the Rural Business-Cooperative
Service for each fiscal year.
(2) Limitation.--Funds available to the Rural Housing
Service, the Rural Utilities Service, and the Rural
Business-Cooperative Service for the payment of loan
costs (as defined in section 502 of Federal Credit
Reform Act of 1990 (2 U.S.C. 661a)) shall not be used
to operate and maintain the Clearinghouse.
SEC. 2382. MONITORING THE ECONOMIC PROGRESS OF RURAL AMERICA.
(a) Bureau of the Census.--The Director of the Bureau of
the Census shall expand the data collection efforts of the
Bureau to enable the Bureau to collect statistically
significant data concerning the changing economic condition of
rural counties and communities in the United States, including
data on rural employment, poverty, income, and other
information concerning the rural labor force.
* * * * * * *
RURAL ELECTRIFICATION ACT OF 1936
* * * * * * *
(2) Limitation on planning and administrative
expenses.--Not more than 4 percent of the amounts made
available under paragraph (1) may be used for planning
and administrative expenses.
SEC. 20. BIOENERGY AND BIOCHEMICAL PROJECTS.
``In carrying out rural electric loan, loan guarantee, and
grant programs under this Act, the Secretary shall provide a
priority for bioenergy and biochemical projects.
SEC. 20. FINANCIAL AND TECHNICAL ASSISTANCE FOR RENEWABLE ENERGY
SYSTEMS.
(a) Definition of Renewable Energy.--In this section, the
term ``renewable energy'' means energy derived from a wind,
solar, biomass, geothermal, or hydrogen source.
(b) Loans, Loan Guarantees, and Grants.--The Secretary
shall make loans, loan guarantees, and grants to rural electric
cooperatives and other rural electric utilities to promote
thedevelopment of economically and environmentally sustainable
renewable energy projects to serve the needs of rural communities or
for rural economic development.
(c) Interest Rate.--A loan made or guaranteed under
subsection (b) shall bear interest at a rate not exceeding 4
percent.
(d) Use of Funds.--
(1) Grants.--A recipient of a grant under subsection
(a) may use the grant funds to pay up to 75 percent of
the cost of an economic feasibility study or technical
assistance for a renewable energy project.
(2) Loans.--If a renewable energy project is
determined to be economically feasible, a recipient of
a loan or loan guarantee under subsection (a) may use
the loan funds to pay a percentage of the cost of the
project determined by the Secretary.
(e) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this section, and on October 1,
2002, and each October 1 thereafter through October 1,
2005, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary to carry out this section
$9,000,000, to remain available until expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
(3) Applicability of other laws.--For the purposes of
the Federal Credit Reform Act of 1990 (2 U.S.C. 661a et
seq.), this subsection shall be treated as if enacted
in an Act of appropriation.
(4) Loan and interest subsidies.--In the case of a
loan or loan guarantee under subsection (a), the
Secretary shall use funds under paragraph (1) to pay
the cost of loan and interest subsidies necessary to
carry out this section.
* * * * * * *
(D) Proceeds.--All proceeds from the
repayment of such loans shall be returned to
the subaccount.
(E) Number of grants.--Such loans and grants
shall be made during each fiscal year to the
full extent of the amounts held by the rural
economic development subaccount, subject only
to limitations as may be from time to time
imposed by law.
SEC. 313A. GUARANTEES FOR BONDS AND NOTES ISSUED FOR ELECTRIFICATION OR
TELEPHONE PURPOSES.
(a) In General.--Subject to subsection (b), the Secretary
shall guarantee payments on bonds or notes issued by
cooperative or other lenders organized on a not-for-profit
basis if the proceeds of the bonds or notes are used for
electrification or telephone projects eligible for assistance
under this Act, including the refinancing of bonds or notes
issued for such projects.
(b) Limitations.--
(1) Outstanding loans.--A lender shall not receive a
guarantee under this section for a bond or note if, at
the time of the guarantee, the total principal amount
of such guaranteed bonds or notes outstanding of the
lender would exceed the principal amount of outstanding
loans of the lender for electrification or telephone
purposes that have been made concurrently with loans
approved for such purposes under this Act.
(2) Generation of electricity.--The Secretary shall
not guarantee payment on a bond or note issued by a
lender, the proceeds of which are used for the
generation of electricity.
(3) Qualifications.--The Secretary may deny the
request of a lender for the guarantee of a bond or note
under this section if the Secretary determines that--
(A) the lender does not have appropriate
expertise or experience or is otherwise not
qualified to make loans for electrification or
telephone purposes;
(B) the bond or note issued by the lender is
not of reasonable and sufficient quality; or
(C) the lender has not provided sufficient
evidence that the proceeds of the bond or note
are used for eligible projects described in
subsection (a).
(4) Interest rate reduction.--
(A) In general.--Except as provided in
subparagraph (B), a lender may not use any
amount obtained from the reduction in funding
costs as a result of the guarantee of a bond or
note under this section to reduce the interest
rate on a new or outstanding loan.
(B) Concurrent loans.--A lender may use any
amount described in subparagraph (A) to reduce
the interest rate on a loan if the loan is--
(i) made by the lender for
electrification or telephone projects
that are eligible for assistance under
this Act; and
(ii) made concurrently with a loan
approved by the Secretary under this
Act for such a project, as provided in
section 307.
(c) Fees.--
(1) In general.--A lender that receives a guarantee
issued under this section on a bond or note shall pay a
fee to the Secretary.
(2) Amount.--The amount of an annual fee paid for the
guarantee of a bond or note under this section shall be
equal to 30 basis points of the amount of the unpaid
principal of the bond or note guaranteed under this
section.
(3) Payment.--A lender shall pay the fees required
under this subsection on a semiannual basis.
(4) Rural economic development subaccount.--Subject
to subsection (e)(2), fees collected under this
subsection shall be--
(A) deposited into the rural economic
development subaccount maintained under section
313(b)(2)(A), to remain available until
expended; and
(B) used for the purposes described in
section 313(b)(2)(B).
(d) Guarantees.--
(1) In general.--A guarantee issued under this
section shall--
(A) be for the full amount of a bond or note,
including the amount of principal, interest,
and call premiums;
(B) be fully assignable and transferable; and
(C) represent the full faith and credit of
the United States.
(2) Limitation.--To ensure that the Secretary has the
resources necessary to properly examine the proposed
guarantees, the Secretary may limit the number of
guarantees issued under this section if the number of
such guarantees exceeds 5 per year.
(3) Department opinion.--On the timely request of an
eligible lender, the General Counsel of the Department
of Agriculture shall provide the Secretary with an
opinion regarding the validity and authority of a
guarantee issued to the lender under this section.
(e) Authorization of Appropriations.--
(1) In general.--There are authorized to be
appropriated such sums as are necessary to carry out
this section.
(2) Fees.--To the extent that the amount of funds
appropriated for a fiscal year under paragraph (1) are
not sufficient to carry out this section, the Secretary
may use up to \1/3\ of the fees collected under
subsection (c) for the cost of providing guarantees of
bonds and notes under this section before depositing
the remainder of the fees into the rural economic
development subaccount maintained under section
313(b)(2)(A).
(f) Termination.--The authority provided under this section
shall terminate on September 30, 2006.
SEC. 314. LIMITATIONS ON AUTHORIZATION OF APPROPRIATIONS.
* * * * * * *
(c) Funding Levels.--The Secretary shall make insured loans
under this title for the purposes, in the amounts, and for the
periods of time specified in subsection (b), as provided in
advance in appropriations Acts.
(d) Availability of Funds for Insured Loans.--Amounts made
available for loans under section 305 are authorized to remain
available until expended.
SEC. 315. EXPANSION OF 911 ACCESS.
(a) In General.--Subject to such terms and conditions as
the Secretary may prescribe, the Secretary may make telephone
loans under this title to State or local governments, Indian
tribes (as defined in section 4 of the Indian Self-
Determination and Education Assistance Act (25 U.S.C. 450b)),
or other public entities for facilities and equipment to expand
911 access in underserved rural areas.
(b) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section.
TITLE IV
Sec. 401. Establishment, General Purposes, and Status of
the Telephone Bank.--(a) There is hereby established a body
corporate to be known as the Rural Telephone Bank (hereinafter
called the telephone bank).
* * * * * * *
(5) provide information to electric and telephone
borrowers under this Act concerning the eligibility of
such borrowers to apply for financial assistance,
loans, or grants from other Federal agencies and non-
Federal sources to enable such borrowers to expand
their rural development efforts; and
(6) promote local partnerships and other coordination
between borrowers under this Act and community
organizations, States, counties, or other entities, to
improve rural development.
TITLE VI--RURAL BROADBAND ACCESS
SEC. 601. ACCESS TO BROADBAND TELECOMMUNICATIONS SERVICES IN RURAL
AREAS.
(a) Purpose.--The purpose of this section is to provide
grants, loans, and loan guarantees to provide funds for the
costs of the construction, improvement, and acquisition of
facilities and equipment for broadband service in eligible
rural communities.
(b) Definitions.--In this section:
(1) Broadband service.--The term ``broadband
service'' means any technology identified by the
Secretary as having the capacity to transmit data to
enable a subscriber to the service to originate and
receive high-quality voice, data, graphics, or video.
(2) Eligible rural community.--The term ``eligible
rural community'' means any incorporated or
unincorporated place that--
(A) has not more than 20,000 inhabitants,
based on the most recent available population
statistics of the Bureau of the Census; and
(B) is not located in an area designated as a
standard metropolitan statistical area.
(c) Grants.--The Secretary shall make grants to eligible
entities described in subsection (e)(1) to provide funds for
the construction, improvement, or acquisition of facilities and
equipment for the provision of broadband service in eligible
rural communities.
(d) Loans and Loan Guarantees.--The Secretary shall make or
guarantee loans to eligible entities described in subsection
(e)(2) to provide funds for the construction, improvement, or
acquisition of facilities and equipment for the provision of
broadband service in eligible rural communities.
(e) Eligible Entities.--To be eligible to obtain a grant
under this section, an entity must--
(1) be eligible to obtain a loan or loan guarantee to
furnish, improve, or extend a rural telecommunications
service under this Act; and
(2) submit to the Secretary a proposal for a project
that meets the requirements of this section.
(f) Broadband Service.--The Secretary shall, from time to
time as advances in technology warrant, review and recommend
modifications of rate-of-data transmission criteria for
purposes of the identification of broadband service
technologies under subsection (b)(1).
(g) Technological Neutrality.--For purposes of determining
whether or not to make a grant, loan, or loan guarantee for a
project under this section, the Secretary shall not take into
consideration the type of technology proposed to be used under
the project.
(h) Terms and Conditions for Loans and Loan Guarantees.--A
loan or loan guarantee under subsection (d) shall--
(1) be made available in accordance with the
requirements of the Federal Credit Reform Act of 1990
(2 U.S.C. 661 et seq.);
(2) bear interest at an annual rate of, as determined
by the Secretary--
(A) 4 percent per annum; or
(B) the current applicable market rate; and
(3) have a term not to exceed the useful life of the
assets constructed, improved, or acquired with the
proceeds of the loan or extension of credit.
(i) Use of Loan Proceeds To Refinance Loans for Deployment
of BroadbandService.--Notwithstanding any other provision of
this Act, the proceeds of any loan made by the Secretary under this Act
may be used by the recipient of the loan for the purpose of refinancing
an outstanding obligation of the recipient on another
telecommunications loan made under this Act if the use of the proceeds
for that purpose will further the construction, improvement, or
acquisition of facilities and equipment for the provision of broadband
service in eligible rural communities.
(j) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this Act, and on October 1, 2002,
and each October 1 thereafter through October 1, 2005,
out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary of Agriculture to carry out
this section $100,000,000, to remain available until
expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
(3) Allocation of funds.--
(A) In general.--From amounts made available
for each fiscal year under paragraph (1), the
Secretary shall--
(i) establish a national reserves for
grants, loans, and loan guarantees to
eligible entities in States under this
section; and
(ii) allocate amounts in the reserve
to each State for each fiscal year for
grants, loans, and loan guarantees in
the State.
(B) Amount.--The amount of an allocation made
to a State for a fiscal year under subparagraph
(A) shall bear the same ratio to the amount of
allocations made for all States for the fiscal
year as the number of communities with a
population of 2,500 inhabitants or less in the
State bears to the number of communities with a
population of 2,500 inhabitants or less in all
States, as determined on the basis of the last
available cenus.
(i) In general.--Subject to
subparagraph (C), the Secretary shall
establish a reserve for each State for
each fiscal year under paragraph (1)
for making grants, loans, and loan
guarantees of credit to eligible
entities in the State.
(C) Unobligated amounts.--Any amounts in the
reserve established for a State for a fiscal
year under subparagraph (B) that are not
obligated by April 1 of the fiscal year shall
be available to the Secretary to make grants,
loans, and loan guarantees under this section
to eligible entities in any State, as
determined by the Secretary.
(k) Termination of Authority.--
(1) In general.--No grant, loan, or loan guarantee
may be made under this section after September 30,
2006.
(2) Effect on validity of grant, loan, or loan
guarantee.--Notwithstanding paragraph (1), any grant,
loan, or loan guarantee made under this section before
the date specified in paragraph (1) shall be valid.
* * * * * * *
AGRICULTURAL RISK PROTECTION ACT OF 2000
* * * * * * *
SEC. 231. VALUE-ADDED AGRICULTURAL PRODUCT MARKET DEVELOPMENT GRANTS.
[(a) Grant Program.--
[(1) Establishment and purposes.--Of the amount made
available under section 261(a)(2), $15,000,000 shall be
used by the Secretary to award competitive grants to
eligible independent producers (as determined by the
Secretary) of value-added agricultural commodities and
products of agricultural commodities to assist an
eligible producer--
[(A) to develop a business plan for viable
marketing opportunities for a value-added
agricultural commodity or product of an
agricultural commodity; or
[(B) to develop strategies for the ventures
that are intended to create marketing
opportunities for the producers.
[(2) Amount of grant.--The total amount provided
under this subsection to a grant recipient may not
exceed $500,000.
[(3) Producer strategies.--A producer that receives a
grant under paragraph (1) shall use the grant--
[(A) to develop a business plan or perform a
feasibility study to establish a viable
marketing opportunity for a value-added
agricultural commodity or product of an
agricultural commodity; or
[(B) to provide capital to establish
alliances or business ventures that allow the
producer to better compete in domestic or
international markets.]
(a) Definition of Value-Added Agricultural Product.--The
term ``value-added agricultural product'' means any
agricultural commodity or product that--
(1)(A) has undergone a change in physical state; or
(B) was produced in a manner that enhances the value
of the agricultural commodity or product, as
demonstrated through a business plan that shows the
enhanced value, as determined by the Secretary; and
(2) as a result of the change in physical state or
the manner in which the agricultural commodity or
product was produced--
(A) the customer base for the agricultural
commodity or product has been expanded; and
(B) a greater portion of the revenue derived
from the processing of the agricultural
commodity or product is available to the
producer of the commodity or product.
(b) Grant Program.--
(1) Purposes.--The purposes of this subsection are--
(A) to increase the share of the food and
agricultural system profit received by
agricultural producers;
(B) to increase the number and quality of
rural self-employment opportunities in
agriculture and agriculturally-related
businesses and the number and quality of jobs
in agriculturally-related businesses;
(C) to help maintain a diversity of size in
farms and ranches by stabilizing the number of
small and mid-sized farms;
(D) to increase the diversity of food and
other agricultural products available to
consumers, including nontraditional crops and
products and products grown or raised in a
manner that enhances the value of the products
to the public;
(E) to conserve and enhance the quality of
land, water, and energy resources, wildlife
habitat, and other landscape values and
amenities in rural areas.
(2) Grants.--From amounts made available under
paragraph (6), the Secretary shall make award
competitive grants--
(A) to an eligible independent producer (as
determined by the Secretary) of a value-added
agricultural product to assist the producer--
(i) to develop a business plan for
viable marketing opportunities for the
value-added agricultural product; or
(ii) to develop strategies that are
intended to create marketing
opportunities for the producer; and
(B) to an eligible nonprofit entity (as
determined by the Secretary) to assist the
entity--
(i) to develop a business plan for
viable marketing opportunities in
emerging markets for a value-added
agricultural product; or
(ii) to develop strategies that are
intended to create marketing
opportunities in emerging markets for
the value-added agricultural product.
(3) Amount of grant.--
(A) In general.--The total amount provided
under this subsection to a grant recipient may
not exceed $500,000.
(B) Priority.--The Secretary shall give
priority to grant proposals for less than
$200,000 submitted under this subsection.
(4) Grantee strategies.--A grantee under paragraph
(2) shall use the grant--
(A) to develop a business plan or perform a
feasibility study to establish a viable
marketing opportunity for a value-added
agricultural product; or
(B) to provide capital to establish alliances
or business ventures that allow the producer of
the value-added agricultural product to better
compete in domestic or international markets.
(5) Grants for marketing or processing certified
organic agricultural products.--
(A) In general.--Out of any amount that is
made available to the Secretary for a fiscal
year under paragraph (2), the Secretary shall
use not less than 5 percent of the amount for
grants to assist producers of certified organic
agricultural products in post-farm marketing or
processing of the products through a business or
cooperative ventures that--
(i) expand the customer base of the
certified organic agricultural
products; and
(ii) increase the portion of product
revenue available to the producers.
(B) Certified organic agricultural product.--
For the purposes of this paragraph, a certified
organic agricultural product does not have to
meet the requirements of the definition of
``value-added agricultural product'' under
subsection (a).
(C) Insufficient applications.--If, for any
fiscal year, the Secretary receives an
insufficient quantity of applications for
grants described in subparagraph (A) to use the
funds reserved under subparagraph (A), the
Secretary may use the excess reserved funds to
make grants for any other purpose authorized
under this subsection.
(6) Funding.--
(A) In general.-- Not later than 30 days
after the date of enactment of this paragraph,
and on October 1, 2002, and each October 1
thereafter through October 1, 2005, out of any
funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury
shall transfer to the Secretary of Agriculture
to carry out their subsection $75,000,000, to
remain available until expended.
(B) Receipt and acceptance.--The Secretary
shall be entitled to receive, shall accept, and
shall use to carry out this subsection the
funds transferred under subparagraph (A),
without further appropriation.
[(b)] (c) Agricultural Marketing Resource Center Pilot
Project.--
(1) Establishment.--Notwithstanding the limitation on
grants in subsection [(a)(2)] (b)(2), the Secretary
shall not use more than [$5,000,000] 7.5 percent of the
funds made available under [subsection (a)] subsection
(b) to establish a pilot project (to be known as the
``Agricultural Marketing Resource Center'') at an
eligible institution described in paragraph (2) that
will--
(A) develop a resource center with electronic
capabilities to coordinate and provide to
independent producers and processors (as
determined by the Secretary) of value-added
agricultural commodities and products of
agricultural commodities information regarding
research, business, legal, financial, or
logistical assistance; and
(B) develop a strategy to establish a
nationwide market information and coordination
system.
(2) Eligible institution.--To be eligible to receive
funding to establish the Agricultural Marketing
Resource Center, an applicant shall demonstrate to the
Secretary--
(A) the capacity and technical expertise to
provide the services described in paragraph
(1)(A);
(B) an established plan outlining support of
the applicant in the agricultural community;
and
(C) the availability of resources (in cash or
in kind) of definite value to sustain the
Center following establishment.
[(c)] (d) Matching Funds.--A recipient of funds under
[subsection (a) or (b)] subsections (b) and (c) shall
contribute an amount of non-Federal funds that is at least
equal to the amount of Federal funds received.
[(d)] (e) Limitation.--Funds provided under this section
may not be used for--
(1) planning, repair, rehabilitation, acquisition, or
construction of a building or facility (including a
processing facility); or
(2) the purchase, rental, or installation of fixed
equipment.
* * * * * * *
AGRICULTURAL RESEARCH, EXTENSION, AND EDUCATION REFORM ACT OF 1998
* * * * * * *
TITLE IV--NEW AGRICULTURAL RESEARCH, EXTENSION, AND EDUCATION
INITIATIVES
SEC. 401. INITIATIVE FOR FUTURE AGRICULTURE AND FOOD SYSTEMS.
(a) Treasury Account.--There is established in the Treasury
of the United States an account to be known as the Initiative
for Future Agriculture and Food Systems (referred to in this
section as the ``Account'') to provide funds for activities
authorized under this section.
(b) Funding.--
(1) In general.--On October 1, 1998, and each October
1 thereafter through October 1, 2002, out of any funds
in the Treasury not otherwise appropriated, the
Secretary of the Treasury shall transfer $120,000,000
to the Account.
(2) Entitlement.--The Secretary of Agriculture--
(A) shall be entitled to receive the funds
transferred to the Account under paragraph (1);
(B) shall accept the funds; and
(C) shall use the funds to carry out this
section.
(c) Purposes.--
[(1) Critical emerging issues.--The Secretary shall
use the funds in the Account--]
(1) Critical emerging issues.--Subject to paragraph
(2), the Secretary shall use the funds in the Account
for research, extension, and education grants (referred
to in this section as ``grants'') to address critical
emerging agricultural issues related to--
(A) future food production;
(B) environmental quality and natural
resource management; or
(C) farm income.
(A) subject to paragraph (2), for research,
extension, and education grants (referred to in
this section as ``grants'') to address critical
emerging agricultural issues related to--
(i) future food production;
(ii) environmental quality and
natural resource management; or
(iii) farm income; and
* * * * * * *
AGRICULTURAL RESEARCH, EXTENSION, AND EDUCATION REFORM ACT OF 1998
* * * * * * *
SEC. 409. CARBON SEQUESTRATION DEMONSTRATION PROGRAM.
(a) Definitions.--In this section:
(1) Eligible project.--The term ``eligible project''
means a project that is likely to result in--
(A) demonstrable reductions in net emissions
of greenhouse gases; or
(B) demonstrable net increases in the
quantity of carbon sequestered in soils and
forests.
(2) Environmental trade.--The term ``environmental
trade'' means a transaction between an emitter of a
greenhouse gas and an agricultural producer under which
the emitter pays to the agricultural producer a fee to
sequester carbon or otherwise reduce emissions of
greenhouse gases.
(3) Panel.--The term ``panel'' means the panel of
experts established under subsection (b)(4)(A).
(4) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture, acting in consultation with--
(A) the Under Secretary of Agriculture for
Natural Resources and Environment;
(B) the Under Secretary of Agriculture for
Research, Education, and Economics;
(C) the Chief Economist of the Department;
and
(D) the panel.
(b) Demonstration Program.--
(1) Establishment.--Subject to the availability of
appropriations, the Secretary shall establish a program
to provide grants, on a competitive, cost-shared basis,
to agricultural producers to assist in paying the costs
incurred in measuring, estimating, monitoring,
verifying, auditing, and testing methodologies involved
in environmental trades (including costs incurred in
employing certified independent third persons to carry
out those activities).
(2) Conditions for receipt of grant.--As a condition
of the acceptance of a grant under paragraph (1), an
agricultural producer shall--
(A) establish a carbon and greenhouse gas
monitoring, verification, and reporting system
that meets such requirements as the Secretary
shall prescribe; and
(B) under the system and through the use of
an independent third party for any necessary
monitoring, verifying, reporting, and auditing,
measure and report to the Secretary the
quantity of carbon sequestered, or the quantity
of greenhouse gas emissions reduced, as a
result of the conduct of an eligible project.
(3) Criteria for award of grant.--
(A) In general.--In awarding a grant for an
eligible project under paragraph (1), the
Secretary shall take into consideration--
(i) the likelihood of the eligible
project in succeeding in achieving
greenhouse gas emissions reductions and
net carbon sequestration increases; and
(ii) the usefulness of the
information to be obtained from the
eligible project in determining how
best to quantify, monitor, and verify
sequestered carbon or reductions in
greenhouse gas emissions.
(B) Priority criteria.--The Secretary shall
give priority in awarding a grant under
paragraph (1) to an eligible project that--
(i) involves multiple parties, a
whole farm approach, or any other
approach, such as the aggregation of
land areas, that would--
(I) increase the
environmental benefits or
reduce the transaction costs of
the eligible project; and
(II) reduce the costs of
measuring, monitoring, and
verifying any net sequestration
of carbon or net reduction in
greenhouse gas emissions;
(ii) is designed to achieve long-term
sequestration of carbon or long-term
reductions in greenhouse gas emissions;
(iii) is designed to address concerns
concerning leakage;
(iv) provides certain other benefits,
such as improvements in--
(I) soil fertility;
(II) wildlife habitat;
(III) water quality;
(IV) soil erosion management;
(V) the use of renewable
resources to produce energy;
(VI) the avoidance of
ecosytem fragmentation; and
(VII) the promotion of
ecosystem restoration with
native species; or
(v) does not involve--
(I) the reforestation of land
that has been deforested since
1990; or
(II) the conversion of native
grassland.
(4) Panel.--
(A) In general.--The Secretary shall
establish a panel to provide advice and
recommendations to the Secretary with respect
to criteria for awarding grants under this
subsection.
(B) Composition.--The panel shall be composed
of the following representatives, to be
appointed by the Secretary:
(i) Experts from each of--
(I) the Department;
(II) the Environmental
Protection Agency; and
(III) the Department of
Energy.
(ii) Experts from nongovernmental and
academic entities.
(5) Payment of grant funds.--The Secretary shall
provide a grant awarded under this section in such
number of installments as is necessary to ensure proper
implementation of an eligible project.
(c) Methodology Grant Program.--
(1) Establishment.--The Secretary shall establish a
program to provide grants to determine the best
methodologies for estimating and measuring increases or
decreases in--
(A) agricultural greenhouse gas emissions;
and
(B) the quantity of carbon sequestered in
soils, forests, and trees.
(2) Eligible recipients.--The Secretary shall award a
grant under paragraph (1), on a competitive basis, to a
college or university, or other research institution,
that seeks to demonstrate the viability of a
methodology described in paragraph (1).
(d) Dissemination of Information.--As soon as practicable
after the date of enactment of this section, the Secretary
shall establish an Internet site through which agricultural
producers may obtain information concerning--
(1) potential environmental trades; and
(2) activities of the Secretary under this section.
(e) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $20,000,000 for
each of fiscal years 2002 through 2006.
TITLE VI--MISCELLANEOUS PROVISIONS
Subtitle A--Existing Authorities
* * * * * * *
TITLE 7
AGRICULTURAL RESEARCH, EXTENSION, AND EDUCATION REFORM ACT OF 1998
* * * * * * *
SEC. 102. PRIORITY SETTING PROCESS.
(a) Establishment.--Consistent with section 1402 of the
National Agricultural Research, Extension, and Teaching Policy
Act of 1977 (7 U.S.C. 3101), the Secretary shall establish
priorities for agricultural research, extension, and education
activities conducted or funded by the Department.
(b) Responsibilities of Secretary.--In establishing
priorities for agricultural research, extension, and education
activities conducted or funded by the Department, the Secretary
shall solicit and consider input and recommendations from
persons who conduct or use agricultural research, extension, or
education.
(c) Responsibilities of 1862, 1890, and 1994
Institutions.--
(1) Process.--Effective October 1, 1999, to obtain
agricultural research, extension, or education formula
funds from the Secretary, each 1862 Institution, 1890
Institution, and 1994 Institution shall [establish and
implement a process for obtaining] obtain public input
from persons who conduct or use agricultural research,
extension, or education concerning the use of the
funds[.] through a process that reflects transparency
and opportunity for input from diverse agricultural
crop, geographic, and cultural communities.
(2) Regulations.--The Secretary shall promulgate
regulations that prescribe--
* * * * * * *
SEC. 401. INITIATIVE FOR FUTURE AGRICULTURE AND FOOD SYSTEMS.
Sec. 724. None of the funds appropriated or otherwise made
available by this or any other Act shall be used to pay the
salaries and expenses of personnel to carry out the transfer or
obligation of fiscal year 2001 funds under the provisions of
section 401 of Public Law 105-185, the Initiative for Future
Agriculture and Food Systems (7 U.S.C. 7621): Provided, That
notwithstanding section 401(d) of Public Law 105-185, any
appropriation or funds available to the Secretary of
Agriculture to make grants under section 401 of Public Law 105-
185 shall be used only to make grants to eligible grantees
specified in subsection (d)(3) of that section.
(a) Treasury Account.--There is established in the Treasury
of the United States an account to be known as the Initiative
for Future Agriculture and Food Systems (referred to in this
section as the ``Account'') to provide funds for activities
authorized under this section.
[(b) Funding.--
[(1) In general.--On October 1, 1998, and each
October 1 thereafter through October 1, 2002, out of
any funds in the Treasury not otherwise appropriated,
the Secretary of the Treasury shall transfer
$120,000,000 to the Account.
[(2) Entitlement.--The Secretary of Agriculture--
[(A) shall be entitled to receive the funds
transferred to the Account under paragraph (1);
[(B) shall accept the funds; and
[(C) shall use the funds to carry out this
section.]
(b) Funding.--
(1) In general.--Out of any funds in the Treasury not
otherwise appropriated, the Secretary of the Treasury
shall transfer to the Account to carry out this
section--
(A) on October 1, 1998 and each October 1
thereafter through October 1, 2001,
$120,000,000; and
(B) on October 1, 2002, and each October 1
thereafter through October 1, 2005,
$145,000,000.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
(c) Purposes.--
(1) Critical emerging issues.--The Secretary shall
use the funds in the Account--
* * * * * * *
(e) Special Considerations.--
(1) Smaller institutions.--The Secretary may award
grants under this section in a mannerthat ensures that
the faculty of small and mid-sized institutions that have not
previously been successful in obtaining competitive grants under
subsection (b) of the Competitive, Special, and Facilities Research
Grant Act (7 U.S.C. 450i(b)) receive a portion of the grants under this
section.
(2) Priorities.--In making grants under this section,
the Secretary shall provide a higher priority to--
(A) a project that is multistate, multi-
institutional, or multidisciplinary; or
(B) a project that integrates agricultural
research, extension, and education.
(3) Minority-serving institutions.--The Secretary
shall consider reserving, to the maximum extent
practicable, 10 percent of the funds made available to
carry out this section for a fiscal year for grants to
minority-serving institutions.
(f) Administration.--
* * * * * * *
(f) Limitation on Use of Grant Funds.--Funds provided under
this section may not be used for the planning, repair,
rehabilitation, acquisition, or construction of a building or
facility.
(g) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 1999 through [2002] 2006.
SEC. 403. PRECISION AGRICULTURE.
(a) Definitions.--In this section:
* * * * * * *
(h) Limitation Regarding Facilities.--A grant made under
this section may not be used for the planning, repair,
rehabilitation, acquisition, or construction of a building or
facility.
(i) Authorization of Appropriations.--
(1) In general.--There are authorized to be
appropriated such sums as are necessary to carry out
this section for each of fiscal years 1999 through
[2002] 2006, of which, for each fiscal year--
* * * * * * *
SEC. 404. BIOBASED PRODUCTS.
(a) Definition of Biobased Product.--In this section, the
term ``biobased product'' means a product suitable for food or
nonfood use that is derived in whole or in part from renewable
agricultural and forestry materials.
* * * * * * *
(e) Pilot Project.--The Secretary, acting through the
Agricultural Research Service, may establish and carry out a
pilot project under which grants are provided, on a competitive
basis, to scientists of the Agricultural Research Service to--
(1) encourage innovative and collaborative science;
and
(2) during each of fiscal years 1999 through [2001]
2006, develop biobased products with promising
commercial potential.
(f) Source of Funds.--
* * * * * * *
SEC. 405. THOMAS JEFFERSON INITIATIVE FOR CROP DIVERSIFICATION.
(a) Initiative Required.--The Secretary of Agriculture
shall provide for a research initiative (to be known as the
``Thomas Jefferson Initiative for Crop Diversification'') for
the purpose of conducting research and development, in
cooperation with other public and private entities, on the
production and marketing of new and nontraditional crops needed
to strengthen and diversify the agricultural production base of
the United States.
* * * * * * *
(h) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 1999 through [2002] 2006.
SEC. 406. INTEGRATED RESEARCH, EDUCATION, AND EXTENSION COMPETITIVE
GRANTS PROGRAM.
(a) Purpose.--It is the purpose of this section to
authorize the Secretary of Agriculture to establish an
integrated research, education, and extension competitive grant
program to provide funding for integrated, multifunctional
agricultural research, extension, and education activities.
(b) Competitive Grants Authorized.--Subject to the
availability of appropriations to carry out this section, the
Secretary may award grants to colleges and universities (as
defined in section 1404 of the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103)) and
1994 Institutions on a competitive basis for integrated
agricultural research, education, and extension projects in
accordance with this section.
(c) Criteria for Grants.--Grants under this section shall
be awarded to address priorities in United States agriculture,
determined by the Secretary in consultation with the Advisory
Board, that involve integrated research, extension, and
education activities.
(d) Matching of Funds.--
(1) General requirement.--If a grant under this
section provides a particular benefit to a specific
agricultural commodity, the Secretary shall require the
recipient of the grant to provide funds or in-kind
support to match the amount of funds provided by the
Secretary in the grant.
(2) Waiver.--The Secretary may waive the matching
funds requirement specified in paragraph (1) with
respect to a grant if the Secretary determines that--
(A) the results of the project, while of
particular benefit to a specific agricultural
commodity, are likely to be applicable to
agricultural commodities generally; or
(B) the project involves a minor commodity,
the project deals with scientifically important
research, and the grant recipient is unable to
satisfy the matching funds requirement.
(e) Term of Grant.--A grant under this section shall have a
term of not more than 5 years.
[(e)] (f) Authorization of Appropriations.--There are
authorized to be appropriated such sums as are necessary to
carry out this section for each of fiscal years 1999 through
[2002] 2006.
* * * * * * *
SEC. 408. SUPPORT FOR RESEARCH REGARDING DISEASES OF WHEAT AND BARLEY
CAUSED BY FUSARIUM GRAMINEARUM.
(a) Research Grant Authorized.--The Secretary of
Agriculture may make a grant to a consortium of land-grant
colleges and universities to enhance the ability of the
consortium to carry out a multi-State research project aimed at
understanding and combating diseases of wheat and barley caused
by Fusarium graminearum and related fungi (referred to in this
section as ``wheat scab'').
* * * * * * *
(d) Management.--To oversee the use of a grant made under
this section, the Secretary may establish a committee composed
of the directors of the agricultural experiment stations in the
States in which land-grant colleges and universities that are
members of the consortium are located.
(e) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $5,200,000 for
each of fiscal years 1999 through [2002] 2006.
* * * * * * *
SEC. 614. OFFICE OF PEST MANAGEMENT POLICY.
(a) Purpose.--The purpose of this section is to establish
an Office of Pest Management Policy to provide for the
effective coordination of agricultural policies and activities
within the Department of Agriculture related to pesticides and
of the development and use of pest management tools, while
taking into account the effects of regulatory actions of other
government agencies.
* * * * * * *
(e) Director.--The Office of Pest Management Policy shall
be under the direction of a Director appointed by the
Secretary, who shall report directly to the Secretary or a
designee of the Secretary.
(f) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 1999 through [2002] 2006.
* * * * * * *
SEC. 620. SENIOR SCIENTIFIC RESEARCH SERVICE.
(a) In General.--There is established in the Department of
Agriculture the Senior Scientific Research Service (referred to
in this section as the ``Service'').
(b) Members.--
(1) In general.--Subject to paragraphs (2) through
(4), the Secretary shall appoint the members of the
Service.
(2) Qualifications.--To be eligible for appointment
to the Service, an individual shall--
(A) have conducted outstanding research in
the field of agriculture or forestry;
(B) have earned a doctoral level degree at an
institution of higher education (as defined in
section 101 of the Higher Education Act of 1965
(20 U.S.C. 1001)); and
(C) meet qualification standards prescribed
by the Director of the Office of Personnel
Management for appointment to a position at
level GS-15 of the General Schedule.
(3) Number.--Not more than 100 individuals may serve
as members of the Service at any 1 time.
(4) Other requirements.--
(A) In general.--Subject to subparagraph (B)
and subsection (d)(2), the Secretary may
appoint and employ a member of the Service
without regard to--
(i) the provisions of title 5, United
States Code, governing appointments in
the competitive service;
(ii) the provisions of subchapter I
of chapter 35 of title 5, United States
Code, relating to retention preference;
(iii) the provisions of chapter 43 of
title 5, United States Code, relating
to performance appraisal and
performance actions;
(iv) the provisions of chapter 51 and
subchapter III of chapter 53 of title
5, United States Code, relating to
classification and General Schedule pay
rates; and
(v) the provisions of chapter 75 of
title 5, United States Code, relating
to adverse actions.
(B) Exception.--A member of the Service
appointed and employed by the Secretary under
subparagraph (A) shall have the same right of
appeal to the Merit Systems Protection Board
and the same right to file a complaint with the
Office of Special Counsel as an employee
appointed to a position at level GS-15 of the
General Schedule.
(c) Performance Appraisal System.--The Secretary shall
develop a performance appraisal system for members of the
Service that is designed to--
(1) provide for the systematic appraisal of the
employment performance of the members; and
(2) encourage excellence in employment performance by
the members.
(d) Compensation.--
(1) In general.--Subject to paragraph (2), the
Secretary shall determine the compensation of members
of the Service.
(2) Limitations.--The rate of pay for a member of the
Service shall--
(A) not be less than the minimum rate payable
for a position at level GS-15 of the General
Schedule; and
(B) not be more than the rate payable for a
position at level I of the Executive Schedule,
unless the rate is approved by the President
under section 5377(d)(2) of title 5, United
States Code.
(e) Retirement Contributions.--
(1) In general.--On the request of a member of the
Service who was an employee of an institution of higher
education (as defined in section 101 of the Higher
Education Act of 1965 (20 U.S.C. 1001)) immediately
prior to appointment as a member of the Service and who
retains the right to continue to make contributions to
the retirement system of the institution, the Secretary
may contribute an amount not to exceed 10 percent of
the basic pay of the member to the retirement system of
the institution on behalf of the member.
(2) Federal retirement system.--
(A) In general.--Subject to subparagraph (B),
a member for whom a contribution is made under
paragraph (1) shall not, as a result of serving
as a member of the Service, be covered by, or
earn service credit under, chapter 83 or 84 of
title 5, United States Code.
(B) Annual leave.--Service of a member of the
Service described in subparagraph (A) shall be
creditable for determining years of service
under section 6303(a) of title 5, United States
Code.
(f) Involuntary Separation.--
(1) In general.--Subject to paragraph (2) and
notwithstanding the provisions of title 5, United
States Code, governing appointment in the competitive
service, in the case of an individual who is separated
from the Service involuntarily and without cause--
(A) the Secretary may appoint the individual
to a position in the competitive civil service
at level GS-15 of the General Schedule; and
(B) the appointment shall be a career
appointment.
(2) Excepted civil service.--In the case of an
individual described in paragraph (1) who immediately
prior to appointment as a member of the Service was not
a career appointee in the civil service or the Senior
Executive Service, the appointment of the individual
under paragraph (1)--
(A) shall be to the excepted civil service;
and
(B) may not exceed a period of 2 years.
Subtitle C--Studies
* * * * * * *
COMPETITIVE, SPECIAL AND FACILITIES RESEARCH GRANT ACT
* * * * * * *
SEC. 2. COMPETITIVE, SPECIAL, AND FACILITIES RESEARCH GRANTS.
(a) Establishment of Grant Program.--(1) In order to
promote research in food, agriculture, and related areas, a
research grants program is hereby established in the Department
of Agriculture.
(2) Short title.--This section may be cited as the
``Competitive, Special, and Facilities Research Grant Act''.
(b) Competitive Grants.--(1) The Secretary of Agriculture
is authorized to make competitive grants, for periods not to
exceed five years, to State agricultural experiment stations,
all colleges and universities, other research institutions and
organizations, Federal agencies, national laboratories, private
organizations or corporations, and individuals, for research to
further the programs of the Department of Agriculture. To the
greatest extent possible the Secretary shall allocate these
grants to high priority research taking into consideration,
when available, the determinations made by the National
Agricultural Research, Extension, Education, and Economics
Advisory Board (as established under section 1408 of the
National Agricultural Research, Extension, and Teaching Policy
Act of 1977 (7 U.S.C. 3123)) identifying high priority research
areas.
(2) High priority research.--For purposes of this
subsection, the term ``high priority research'' means basic and
applied research that focuses on both national and multistate
research needs (and methods to transfer such research to onfarm
or inmarket practice) [in--
[(A) plant systems, including plant genome structure
and function; molecular and cellular genetics and plant
biotechnology; plant-pest interactions and biocontrol
systems; crop plant response to environmental stresses;
unproved nutrient qualities of plant products; and new
food and industrial uses of plant products;
[(B) animal systems, including aquaculture, cellular
and molecular basis of animal reproduction, growth,
disease, and health; identification of genes
responsible for improved production traits and
resistance to disease; improved nutritional performance
of animals; and improved nutrient qualities of animal
products, and uses, and the development of new and
improved animal husbandry and production systems that
take into account production efficiency and animal
well-being, and animal systems applicable to
aquaculture;
[(C) nutrition, food quality, and health, including
microbial contaminants and pesticides residues related
to human health; links between diet and health;
bioavailability of nutrients; postharvest physiology
and practices; and improved processing technologies;
[(D) natural resources and the environment, including
fundamental structures and functions of ecosystems;
biological and physical bases of sustainable production
systems; minimizing soil and water losses and
sustaining surface water and ground water quality;
global climate effects on agriculture; forestry; and
biological diversity;
[(E) engineering, products, and processes, including
new uses and new products from traditional and non-
traditional crops, animals, byproducts, and natural
resources; robotics, energy efficiency, computing, and
expert systems; new hazard and risk assessment and
mitigation measures; and water quality and management;
and
[(F) markets, trade, and policy, including optional
strategies for entering and being competitive in
overseas markets; new decision tools for onfarm and
inmarket systems; choices and applications of
technology; technology assessment; and new approaches
to rural economic development.], as those needs are
determined by the Secretary, in consultation with the
National Agricultural Research, Extension, Education,
and Economics Advisory Board, not later than July 1 of
each fiscal year for the purposes of the following
fiscal year.
(3) Types of grants.--In addition to making research grants
under paragraph (1), the Secretary may conduct a program to
improve research capabilities in the agricultural, food, and
environmental sciences and award the following categories of
competitive grants:
(A) Grants may be awarded to a single investigator or
coinvestigators within the same discipline.
(B) Grants may be awarded to teams of researchers
fromdifferent areas of agricultural research and
scientific disciplines.
* * * * * * *
CRITICAL AGRICULTURAL MATERIALS ACT
* * * * * * *
Sec. 16. (a) There are authorized to be appropriated to the
Secretary of Agriculture such sums as are necessary to carry
out this Act in each of the fiscal years 1991 through [2002]
2006.
(b) No more than 3 per centum of funds authorized under
subsection (a) shall be available for administration and
management of the program.
* * * * * * *
TITLE XVI (RESEARCH) OF THE FOOD, AGRICULTURE, CONSERVATION, AND TRADE
ACT OF 1990
* * * * * * *
SEC. 1668. BIOTECHNOLOGY RISK ASSESSMENT RESEARCH.
(a) Purpose.--It is the purpose of this section to--
(1) authorize and support environmental assessment
research to the extent necessary to help address
general concerns about environmental effects of
biotechnology; and
(2) authorize research to help regulators develop
policies, as soon as practicable, concerning the
introduction into the environment of such technology.
(b) Grant Program.--The Secretary of Agriculture shall
establish a grant program within the Cooperative State Research
Service and the Agricultural Research Service to provide the
necessary funding for environmental assessment research
concerning the introduction of genetically engineered organisms
into the environment.
(c) Types of Research.--Types of research for which grants
may be made under this section shall include the following:
(1) Research designed to develop methods to
physically and biologically contain genetically
engineered animals, plants, and microorganisms once
they are introduced into the environment.
(2) Research designed to develop methods to monitor
the dispersal of genetically engineered animals,
plants, and microorganisms.
(3) Research designed to further existing knowledge
with respect to the rates and methods of gene transfer
that may occur between genetically engineered organisms
and related wild and agricultural organisms.
(4) Other areas of research designed to further the
purposes of this section.
(d) Eligibility Requirements.--Grants under this section
shall be--
(1) made on the basis of the quality of the proposed
research project; and
(2) available to any public or private research or
educational institution or organization.
(e) Grant Priority.--In selecting projects for which grants
shall be made under this section, the Secretary shall give
priority to public and private research or educational
institutions and organizations the goals of which include--
(1) formation of interdisciplinary teams to review or
conduct research on the environmental effects of the
release of new genetically modified agricultural
products;
(2) conduct of studies relating to biosafety of
genetically modified agricultural products;
(3) evaluation of the cost and benefit for
development of an identity preservation system for
genetically modified agricultural products;
(4) establishment of international partnerships for
research and education on biosafety issues; or
(5) formation of interdisciplinary teams to renew and
conduct research on the nutritional enhancement and
environmental benefits of genetically modified
agricultural products.
[(e)](f) Consultation.--In considering specific areas of
research for funding under this section, the Secretary of
Agriculture shall consult with the Administrator of the Animal
and Plant Health Inspection Service, the Office of Agricultural
Biotechnology, and the Agricultural Biotechnology Research
Advisory Committee.
[(f)](g) Program Coordination.--The Secretary of
Agriculture shall coordinate researchfunded under this section
with the Office of Research and Development of the Environmental
Protection Agency in order to avoid duplication of research activities.
[(g)] (h) Authorization of Appropriations.--
(1) In general.--There are authorized to be
appropriated such sums as necessary to carry out this
section.
(2) Withholdings from biotechnology outlays.--The
Secretary of Agriculture shall withhold from outlays of
the Department of Agriculture for research on
biotechnology, as defined and determined by the
Secretary, at least one percent of such amount for the
purpose of making grants under this section for
research on biotechnology risk assessment.
* * * * * * *
SEC. 1672. HIGH-PRIORITY RESEARCH AND EXTENSION INITIATIVES.
(a) Competitive Specialized Research and Extension Grants
Authorized.--The Secretary of Agriculture (referred to in this
section as the ``Secretary'') may make competitive grants to
support research and extension activities specified in
subsections (e), (f), and (g). The Secretary shall make the
grants in consultation with the National Agricultural Research,
Extension, Education, and Economics Advisory Board.
* * * * * * *
(24) Tomato spotted wilt virus research and
extension.--Research and extension grants may be made
under this section for the purpose of control,
management, and eradication of tomato spotted wilt
virus.
(25) Animal infectious diseases research and
extension.--
(A) In general.--Research and extension
grants may be made under this section for the
purpose of developing--
(i) prevention and control
methodologies for animal infectious
diseases that impact trade, including
vesicular stomatitis, bovine
tuberculosis, transmissible spongiform
encephalopathy, brucellosis, and E.
coli 0157:H7 infection;
(ii) laboratory tests for quicker
detection of infected animals and
presence of diseases among herds;
(iii) prevention strategies,
including vaccination programs; and
(iv) rapid diagnostic techniques for,
and evaluation of, animal disease
agents considered to be risks for
agricultural bioterrorism attack.
(B) Collaboration.--Research under
subparagraph (A) may be conducted in
collaboration with scientists from the
Department, other Federal agencies,
universities, and industry.
(C) Evaluation of diagnostic techniques and
vaccines.--Any research on or evaluation of
diagnostic techniques and vaccines under
subparagraph (A) shall include evaluation of
diagnostic techniques and vaccines under field
conditions in countries in which the animal
disease occurs.
(26) Program to combat childhood obesity.--Research
and extension grants may be made under this section to
consortia of institutions of higher education that
specialize in obesity and nutrition research to develop
and implement effective strategies to reduce the
incidence of childhood obesity.
(27) Integrated pest management.--Research and
extension grants may be made under this section to land
grant colleges and universities, other Federal
agencies, and other interested persons to coordinate
and improve research, education, and outreach on, and
implementation on farms of, integrated pest management.
(28) Beef cattle genetics.--
(A) In general.--Research and extension
grants for beef cattle genetics evaluation
research may be made under this section to
institutions of higher education, or consortia
of institutions of higher education, that--
(i) have expertise in beef cattle
genetic evaluation research and
technology; and
(ii) have been actively involved, for
at least 20 years, in the estimation
and prediction of progeny differences
for publication and use by seed stock
producer breed associations.
(B) Priority.--In making grants under
subparagraph (A), the Secretary shall give
priority to proposals to--
(i) establish and coordinate
priorities for genetic evaluation of
domestic beef cattle;
(ii) consolidate research efforts to
reduce duplication of effort and
maximize the return to beef industry;
(iii) streamline the process between
the development and adoption of new
genetic evaluation methodologies by the
industry;
(iv) identify new traits and
technologies for inclusion in genetic
programs in order to--
(I) reduce the costs of beef
production; and
(II) provide consumers with a
high nutritional value,
healthy, and affordable protein
source; or
(v) create decisionmaking tools that
incorporate the increasing number of
traits being evaluated and the
increasing amount of information from
DNA technology into genetic improvement
programs, with the goal of optimizing
the overall efficiency, product quality
and safety, and health of the domestic
beef cattle herd resource.
(f) Imported Fire Ant Control, Management, and
Eradication.--
* * * * * * *
(h) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 1999 through [2002] 2006.
* * * * * * *
SEC. 1672A. NUTRIENT MANAGEMENT RESEARCH AND EXTENSION INITIATIVE.
(a) Competitive Research and Extension Grants Authorized.--
The Secretary of Agriculture (referred to in this section as
the ``Secretary'') may make competitive grants to support
research and extension activities specified in subsection (e).
The Secretary shall make the grants in consultation with the
National Agricultural Research, Extension, Education, and
Economics Advisory Board.
* * * * * * *
(5) Alternative uses of animal waste.--Research and
extension grants may be made under this section for the
purpose of finding innovative methods and technologies
for economic use or disposal of animal waste.
(g) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 1999 through [2002] 2006.
SEC. 1672B. ORGANIC AGRICULTURE RESEARCH AND EXTENSION INITIATIVE.
(a) Competitive Specialized Research and Extension Grants
Authorized.--In consultation with the National Agricultural
Research, Extension, Education, and Economics Advisory Board
and the National Organic Standards Board, the Secretary of
Agriculture (referred to in this section as the ``Secretary'')
may make competitive grants to support research and extension
activities regarding organically grown and processed
agricultural commodities for the purposes of--
(1) facilitating the development of organic
agriculture production and processing methods;
(2) evaluating the potential economic benefits to
producers and processors who use organic methods; [and]
(3) exploring international trade opportunities for
organically grown and processed agricultural
commodities[.];
(4) determining desirable traits for organic
commodities using advanced genomics;
(5) pursuing classical and marker-assisted breeding
for publicly held varieties of crops and animals
optimized for organic systems;
(6) identifying marketing and policy constraints on
the expansion of organic agriculture; and
(7) conducting advanced on-farm research and
development that emphasizes observation of,
experimentation with, and innovation for working
organic farms, including research relating to
production and to socioeconomic conditions.
(b) Grant Types and Process, Prohibition on Construction.--
Paragraphs (1), (6), (7), and (11) of subsection (b) of the
Competitive, Special, and Facilities Research Grant Act (7
U.S.C. 450i) shall apply with respect to the making of grants
under this section.
* * * * * * *
(d) Partnerships Encouraged.--Following the completion of a
peer review process for grant proposals received under this
section, the Secretary may provide a priority to those grant
proposals, found in the peer review process to be
scientifically meritorious, that involve the cooperation of
multiple entities.
(e) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 1999 through [2002] 2006.
* * * * * * *
SEC. 1680. ASSISTIVE TECHNOLOGY PROGRAM FOR FARMERS WITH DISABILITIES.
(a) Special Demonstration Grants.--
* * * * * * *
(c) Authorization of Appropriations.--
(1) In general.--Subject to paragraph (2), there is
authorized to be appropriated to carry out this section
$6,000,000 for each of fiscal years 1999 through [2002]
2006.
(2) National grant.--Not more than 15 percent of the
amounts made available under paragraph (1) for a fiscal
year shall be used to carry out subsection (b).
* * * * * * *
HATCH ACT OF 1887
* * * * * * *
Sec. 3. (a) There are hereby authorized to be appropriated
for the purposes of this Act such sums as Congress may from
time to time determine to be necessary.
* * * * * * *
(d) Matching Funds.--
(1) Requirement.--Except as provided in paragraph
(4), no allotment shall be made to a State under
subsection (b) or (c), and no payments from the
allotment shall be made to a State, in excess of the
amount that the State makes available out of non-
Federal funds for agricultural research and for the
establishment and maintenance of facilities for the
performance of the research.
(2) Failure to provide matching funds.--If a State
fails to comply with the requirement to provide
matching funds for a fiscal year under paragraph (1),
the Secretary of Agriculture shall withhold from
payment to the State for that fiscal year an amount
equal to the difference between--
(A) the amount that would be allotted and
paid to the State under subsections (b) and (c)
(if the full amount of matching funds were
provided by the State); and
(B) the amount of matching funds actually
provided by the State.
(3) Reapportionment.--
(A) In general.--The Secretary of Agriculture
shall reapportion amounts withheld under
paragraph (2) for a fiscal year among the
States satisfying the matching requirement for
that fiscal year.
(B) Matching requirement.--Any
reapportionment of funds under this paragraph
shall be subject to the matching requirement
specified in paragraph (1).
[(4) Territories.--In lieu of the matching funds
requirement of paragraph (1), the Commonwealth of
Puerto Rico, the Virgin Islands, and Guam shall be
subject to the same matching funds requirements as
those applicable to an eligible institution under
section 1449 of the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 (7 U.S.C.
3222d).]
(4) Exception for insular areas.--
(A) In general.--Effective beginning for
fiscal year 2003, in lieu of the matching funds
requirement of paragraph (1), the insular areas
of the Commonwealth of Puerto Rico, Guam, and
the Virgin Islands of the United States shall
provide matching funds from non-Federal sources
in an amount equal to not less than 50 percent
of the formula funds distributed by the
Secretary to each of the insular areas,
respectively, under this section.
(B) Waivers.--The Secretary may waive the
matching fund requirement of subparagraph (A)
for any fiscal year if the Secretary determines
that the government of the insular area will be
unlikely to meet the matching requirement for
the fiscal year.
(e) ``Administration'' as used in this section shall
include participation in planning and coordinating cooperative
regional research as defined in subsection (c)(3).
* * * * * * *
[(i) Integration of Research and Extension.--
(1) In general.--Not less than the applicable
percentage specified under paragraph (2) of the Federal
formula funds that are paid under this Act and
subsections (b) and (c) of section 3 of the Smith-Lever
Act (7 U.S.C. 343) to colleges and universities
eligible to receive funds under the Act of July 2, 1862
(12 Stat. 503, chapter 130; 7 U.S.C. 301 et seq.), during
a fiscal year shall be expended for activities that
integrate cooperative research and extension (referred
to in this subsection as ``integrated activities'').
[(2) Applicable percentages.--
[(A) 1997 expenditures on multistate
activities.--Of the Federal formula funds that
were paid to each State for fiscal year 1997
under this Act and subsections (b) and (c) of
section 3 of the Smith-Lever Act (7 U.S.C.
343), the Secretary of Agriculture shall
determine the percentage that the State
expended for integrated activities.
[(B) Required expenditures on multistate
activities.--Of the Federal formula funds that
are paid to each State for fiscal year 2000 and
each subsequent fiscal year under this Act and
subsections (b) and (c) of section 3 of the
Smith-Lever Act (7 U.S.C. 343), the State shall
expend for the fiscal year for integrated
activities a percentage that is at least equal
to the lesser of--
[(i) 25 percent; or
[(ii) twice the percentage for the
State determined under subparagraph
(A).
[(C) Reduction by secretary.--The Secretary
of Agriculture may reduce the minimum
percentage required to be expended by a State
for integrated activities under subparagraph
(B) in a case of hardship, infeasibility, or
other similar circumstance beyond the control
of the State, as determined by the Secretary.
[(D) Plan of work.--The State shall include
in the plan of work of the State required under
section 7 of this Act or section 4 of the
Smith-Lever Act (7 U.S.C. 344), as applicable,
a description of the manner in which the State
will meet the requirements of this paragraph.
[(3) Applicability.--This subsection does not apply
to funds provided--
[(A) by a State or local government pursuant
to a matching requirement;
[(B) to a 1994 Institution (as defined in
section 532 of the Equity in Educational Land-
Grant Status Act of 1994 (Public Law 103-382; 7
U.S.C. 301 note)); or
[(C) to the Commonwealth of Puerto Rico, the
Virgin Islands, or Guam.
[(4) Relationship to other requirements.--Federal
formula funds described in paragraph (1) that are used
by a State for a fiscal year for integrated activities
in accordance with paragraph (2)(B) may also be used to
satisfy the multistate activities requirements of
subsection (c)(3) of this section and section 3(h) of
the Smith-Lever Act (7 U.S.C. 343(h)) for the same
fiscal year.]
(i) Integrated Research and Extension Activities.--
(1) In general.--
(A) Requirement.--To receive funding under
this Act and subsections (b) and (c) of section
3 of the Smith-Lever Act (7 U.S.C. 343) for a
fiscal year, a State must have expended on
activities that integrate cooperative research
and extension (referred to in this section as
``integrated activities''), in the preceding
fiscal year, an amount equivalent to not less
than 25 percent of the funds paid to the State
under this section and subsections (b) and (c)
of section 3 of the Smith-Lever Act (7 U.S.C.
343) for the preceding fiscal year.
(B) Determination of amount.--In determining
compliance with subparagraph (A), the Secretary
shall include all cooperative research and
extension funds expended by the State in the
prior fiscal year, including Federal, State,
and local funds.
(2) Reduction of percentage.--The Secretary may
reduce the minimum percentage required to be expended
for integrated activities under paragraph (1) by a
State in a case of hardship, unfeasibility, or other
similar circumstances beyond the control of the State,
as determined by the Secretary.
(3) Plan of work.--The State shall include in the
plan of work of the State required under section 7 of
this Act and under section 4 of the Smith-Lever Act (7
U.S.C. 344), as applicable, a description of the manner
in which the State will meet the requirements of this
subsection.
(4) Applicability.--This subsection does not apply to
funds provided--
(A) to a 1994 Institution (as defined in
section 532 of the Equity in Educational Land-
Grant Status Act of 1994 (7 U.S.C. 301 note;
Public Law 103-382)); or
(B) to the Commonwealth of Puerto Rico, the
Virgin Islands, or Guam.
(5) Relationship to other requirements.--Funds
described in paragraph (1)(B) that a State uses to
calculate the required amount of expenditures for
integrated activities under paragraph (1)(A) may also
be used in the same fiscal year to calculate the amount
of expenditures for multistate activities required
under subsection (c)(3) of this section and section
3(h) of the Smith-Lever Act (7 U.S.C. 343(h)).
* * * * * * *
SEC. 7. DUTIES OF SECRETARY; ASCERTAINMENT OF ENTITLEMENT OF STATE TO
FUNDS; PLANS OF WORK.
(a) Duties of Secretary.--The Secretary of Agriculture is
hereby charged with the responsibility for the proper
administration of this Act, and is authorized and directed to
prescribe such rules and regulations as may be necessary to
carry out its provisions. It shall be the duty of the Secretary
to furnish such advice and assistance as will best promote the
purposes of this Act, including participation in coordination
of research initiated under this Act by the State agricultural
experiment stations, from time to time to indicate such lines
of inquiry as to him seem most important, and to encourage and
assist in the establishment and maintenance of cooperation by
and between the several State agricultural experiment stations,
and between the stations and the United States Department of
Agriculture.
(b) Ascertainment of Entitlement.--On or before the first
day of October in each year after the passage of this Act, the
Secretary of Agriculture shall ascertain as to each State
whether it is entitled to receive its share of the annual
appropriations for agricultural experiment stations under this
Act and the amount which thereupon each is entitled,
respectively, to receive.
[(c) Effect of Failure To Expend Full Allotment.--Whenever
it shall appear to the Secretary of Agriculture from the annual
statement of receipts and expenditures of funds by any State
agricultural experiment station that any portion of the
preceding annual appropriation allotted to that station under
this Act remains unexpended, such amount shall be deducted from
the next succeeding annual allotment to the State concerned.]
(c) Carryover.--
(1) In general.--The balance of any annual funds
provided under this Act to a State agricultural
experiment station for a fiscal year that remains
unexpended at the end of the fiscal year may be carried
over for use during the following fiscal year.
(2) Failure to expend full allotment.--If any
unexpended balance carried over by a State is not
expended by the end of the second fiscal year, an
amount equal to the unexpended balance shall be
deducted from the next succeeding annual allotment to
the State.
* * * * * * *
(4) The manner in which research and extension,
including research and extension activities funded
other than through formula funds, will cooperate to
address the critical issues in the State, including the
activities to be carried out separately, the activities
to be carried out sequentially, and the activities to
be carried out jointly.
(5) The technology transfer activities conducted with
respect to federally-funded agricultural research.
(f) Research Protocols.--
* * * * * * *
NATIONAL AQUACULTURE ACT OF 1980
* * * * * * *
Sec. 10. For purposes of carrying out the provisions of
this Act, there are authorized to be appropriated--
(1) to the Department of Agriculture, $1,000,000 for
each of fiscal years 1991 through [2002] 2006;
(2) to the Department of Commerce, $1,000,000 for
each of fiscal years 1991 through [2002] 2006; and
(3) to the Department of Interior, $1,000,000 for
each of fiscal years 1991 through [2002] 2006.
Funds authorized by this section shall be in addition
to,and not in lieu of, funds authorized by any other Act.
* * * * * * *
NATIONAL AGRICULTURAL RESEARCH, EXTENSION, AND TEACHING POLICY ACT OF
1977
* * * * * * *
Sec. 1404. When used in this title:
(1) The term ``Advisory Board'' means the National
Agricultural Research, Extension, Education, and
Economics Advisory Board.
(2) The term ``agricultural research'' means research
in the food and agricultural sciences.
* * * * * * *
(9) The term ``Hispanic-serving institution'' has the
meaning given the term by section 316(b)(1) of the
Higher Education Act of 1965 (20 U.S.C. 1059c(b)(1)).
(10) Insular area.--The term ``insular area'' means--
(A) the Commonwealth of Puerto Rico;
(B) Guam;
(C) American Samoa;
(D) the Commonwealth of the Northern Mariana
Islands;
(E) the Federated States of Micronesia;
(F) the Republic of the Marshall Islands;
(G) the Republic of Palau;
(H) and the Virgin Islands of the United
States.
[(10)](11) The term ``land-grant colleges and
universities'' means those institutions eligible to
receive funds under the Act of July 2, 1862 (12 Stat.
503-505, as amended; 7 U.S.C. 301-305, 307 and 308), or
the Act of August 30, 1890 (26 Stat. 417-419, as
amended; 7 U.S.C. 321-326 and 328), including Tuskegee
University.
[(11)](12) The term ``Secretary'' means the Secretary
of Agriculture of the United States.
[(12) The term ``State'' means any one of the fifty
States, the Commonwealth of Puerto Rico, Guam, American
Samoa, the Commonwealth of the Northern Marianas, the
Trust Territory of the Pacific Islands, the Virgin
Islands of the United States, and the District of
Columbia.
(13) State.--The term ``State'' means--
(A) a State;
(B) the District of Columbia; and
(C) any insular area.
[(13)] (14) The term ``State agricultural experiment
stations'' means those institutions eligible to receive
funds under the Act of March 2, 1887 (24 Stat. 440-442,
as amended; 7 U.S.C. 361a-361i).
[(14)](15) Teaching and education.--The terms
``teaching'' and ``education'' mean formal classroom
instruction, laboratory instruction, and practicum
experience in the food and agricultural sciences and
matters relating thereto (such as faculty development,
student recruitment and services, curriculum
development, instructional materials and equipment, and
innovative teaching methodologies) conducted by
colleges and universities offering baccalaureate or
higher degrees.
[(15)](16) The term ``cooperating forestry schools''
means those institutions eligible to receive funds
under the Act of October 10, 1962 (16 U.S.C. 582a et
seq.), commonly known as the McIntire-Stennis Act of
1962.
[(16)](17) The term ``State cooperative
institutions'' or ``State cooperative agents'' means
institutions or agents designated by--
(A) the Act of July 2, 1862 (7 U.S.C. 301 et
seq.), commonly known as the First Morrill Act;
(B) the Act of August 30, 1890 (7 U.S.C. 321
et seq.), commonly known as the Second Morrill
Act, including Tuskegee University;
(C) the Act of March 2, 1887 (7 U.S.C. 361a
et seq.), commonly known as the Hatch Act of
1887;
(D) the Act of May 8, 1914 (7 U.S.C. 341 et
seq.), commonly known as the Smith-Lever Act;
(E) the Act of October 10, 1962 (16 U.S.C.
582a et seq.), commonly known as the McIntire-
Stennis Act of 1962; and
(F) subtitles E, G, L, and M of this title.
[(17)](18) The term ``sustainable agriculture'' means
anintegrated system of plant and animal production
practices having a site-specific application that will, over the long-
term--
SEC. 1417. GRANTS AND FELLOWSHIPS FOR FOOD AND AGRICULTURAL SCIENCES
EDUCATION.
(a) Higher Education Teaching Programs.--The Secretary
shall promote and strengthen higher education in the food and
agricultural sciences by formulating and administering programs
to enhance college and university teaching programs in
agriculture, natural resources, forestry, veterinary medicine,
home economics, [and] and rural economic, community, and
business development disciplines closely allied to the food and
agricultural system.
(b) Grants.--The Secretary may make competitive grants (or
grants without regard to any requirement for competition) to
land-grant colleges and universities, to colleges and
universities having significant minority enrollments and a
demonstrable capacity to carry out the teaching of food and
agricultural sciences, and to other colleges and universities
having a demonstrable capacity to carry out the teaching of
food and agricultural sciences, for a period not to exceed 5
years--
(1) to strengthen institutional capacities, including
curriculum, faculty, scientific instrumentation,
instruction delivery systems, and student recruitment
and retention, to respond to identified State,
regional, national, or international educational needs
in the food and agricultural sciences, or in rural
economic, community, and business development;
(2) to attract and support undergraduate and graduate
students in order to educate the students in national
need areas of the food and agricultural sciences, or in
rural economic, community, and business development;
(3) to facilitate cooperative initiatives between two
or more eligible institutions, or between eligible
institutions and units of State government or
organizations in the private sector, to maximize the
development and use of resources such as faculty,
facilities, and equipment to improve food and
agricultural sciences teaching programs, or teaching
programs emphasizing rural economic, community, and
business development;
(4) to design and implement food and agricultural
programs, or programs emphasizing rural economic,
community, and business development, to build teaching
and research capacity at colleges and universities
having significant minority enrollments;
(5) to conduct undergraduate scholarship programs to
meet national and international needs for training food
and agricultural scientists and professionals, or
professionals in rural economic, community, and
business development; and
* * * * * * *
(6) to conduct graduate and postdoctoral fellowship
programs to attract highly promising individuals to
research or teaching careers in the food and
agricultural sciences.
(c) Priorities.--In awarding grants under subsection (b),
the Secretary shall give priority to--
(1) applications for teaching enhancement projects
that demonstrate enhanced coordination among all types
of institutions eligible for funding under this
section; and
(2) applications for teaching enhancement projects
that focus on innovative, multidisciplinary education
programs, material, and curricula.
(d) Eligibility for Grants.--
(1) In general.--To be eligible for a grant under
subsection (b), a recipient institution must have a
significant demonstrable commitment to higher education
teaching programs in the food and agricultural
sciences, or in rural economic, community, and business
development, and to each specific subject area for
which the grant is to be used.
(2) Minority groups.--The Secretary may set aside a
portion of the funds appropriated for the awarding of
grants under subsection (b), and make such amounts
available only for grants to eligible colleges and
universities that the Secretary determines have unique
capabilities for achieving the objective of full
representation of minority groups in the food and
agricultural sciences workforce, or in the rural
economic, community, and business development
workforce, of the United States.
(3) Research foundations.--An eligible college or
university under subsection (b) includes a research
foundation maintained by the college or university.
(e) Food and Agricultural Education Information System.--
From amounts made available for grants under this section, the
Secretary may maintain a national food and agricultural
education information system that contains--
* * * * * * *
(k) Administration.--The Federal Advisory Committee Act (5
U.S.C. App. 2) and title XVIII of the Food and Agriculture Act
of 1977 (7 U.S.C. 2281 et seq.) shall not apply to a panel or
board created for the purpose of reviewing applications and
proposals for grants or nominations for awards submitted under
this section.
(l) Authorization of Appropriations.--There are authorized
to be appropriated for carrying out this section $60,000,000
for each of the fiscal years 1990 through [2002] 2006.
SEC. 1417A. COMPETITIVE RESEARCH FACILITIES GRANT PROGRAM.
(a) Authority.--The Secretary may award grants to eligible
institutions on a competitive basis for the construction,
acquisition, modernization, renovation, alteration, and
remodeling of food and agricultural research facilities such as
buildings, laboratories, and other capital facilities
(including acquisition of fixtures and equipment) in accordance
with this section.
(b) Eligible Institutions.--The following institutions are
eligible to compete for grants under subsection (a):
(1) A State cooperative institution.
(2) A Hispanic-serving institution.
(c) Criteria for Award.--The Secretary shall award grants
to support the national research purposes specified in section
1402 in a manner determined by the Secretary.
(d) Matching.--
(1) In general.--The Secretary may establish such
matching requirements for grants under subsection (a)
as the Secretary considers appropriate.
(2) Form of match.--Matching requirements established
by the Secretary may be met with unreimbursed indirect
costs and in-kind contributions.
(3) Evaluation preference.--The Secretary may include
an evaluation preference for projects for which the
applicant proposes funds for the direct costs of a
project to meet the required match.
(e) Targeted Institutions.--The Secretary may determine
that a portion of funds made available to carry out this
section shall be targeted to particular eligible institutions
to enhance the capacity of the eligible institutions to carry
out research.
(f) Administration.--
(1) Regulations.--The Secretary shall promulgate such
regulations as are necessary to carry out this section.
(2) States With More Than 1 Eligible Institution.--In
a State having more than 1 eligible institution, the
Secretary shall establish procedures in accordance with
the purposes specified in section 1402 to ensure that
the facility proposals of the eligible institutions in
the State provide for a coordinated food and
agricultural research program among eligible
institutions in the State.
(g) Applicability of the Federal Advisory Committee Act.--
The Federal Advisory Committee Act (5 U.S.C. App.) and title
XVIII of the Food and Agriculture Act of 1977 (7 U.S.C. 2281 et
seq.) shall not apply to a panel or board created solely for
the purpose of reviewing applications or proposals submitted
under this section.
(h) Advisory Board.--In carrying out this section, the
Secretary shall consult with the Advisory Board.
(i) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 2002 through 2006.
* * * * * * *
SEC. 1419. GRANTS FOR RESEARCH ON THE PRODUCTION AND MARKETING OF
ALCOHOLS AND INDUSTRIAL HYDROCARBONS FROM
AGRICULTURAL COMMODITIES AND FOREST PRODUCTS.
(a) Authority of Secretary.--The Secretary may award grants
under this section to colleges, universities, and Federal
laboratories for the purpose of conducting research related
to--
* * * * * * *
(c) Minority Groups.--The Secretary may set aside a portion
of funds appropriated for the award of grants under this
section and make such amounts available only for grants to
eligiblecolleges and universities that the Secretary determines
have unique capabilities for achieving the objective of full
participation of minority groups in research on the production and
marketing of alcohols and industrial hydrocarbons from agricultural
commodities and forest products.
(d) Authorization of Appropriations.--There are authorized
to be appropriated for the purposes of carrying out this
section $20,000,000 for each of the fiscal years 1991 through
[2002] 2006.
* * * * * * *
SEC. 1419A. POLICY RESEARCH CENTERS.
(a) In General.--Consistent with this section, the
Secretary may make grants, competitive grants, and special
research grants to, and enter into cooperative agreements and
other contracting instruments with, policy research centers
described in subsection (b) to conduct research and education
programs that are objective, operationally independent, and
external to the Federal Government and that concern the effect
of public policies and trade agreements on--
(1) the farm and agricultural sectors;
(2) the environment;
(3) rural families, households, and economies; and
(4) consumers, food, and nutrition.
(b) Eligible Recipients.--State agricultural experiment
stations, colleges and universities, other research
institutions and organizations, private organizations,
corporations, and individuals shall be eligible to apply for
funding under subsection (a).
(c) Activities.--Under this section, funding may be
provided for disciplinary and interdisciplinary research and
education concerning policy research activities consistent with
this section, including activities that--
(1) quantify the implications of public policies and
regulations;
(2) develop theoretical and research methods;
(3) [collect and analyze] collect, analyze, and
disseminate data for policymakers, analysts, and
individuals; and
(4) develop programs to train analysts.
(d) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 1996 through [2002] 2006.
* * * * * * *
SEC. 1424. HUMAN NUTRITION INTERVENTION AND HEALTH PROMOTION RESEARCH
PROGRAM.
(a) Authority of Secretary.--The Secretary may establish,
and award grants for projects for, a multi-year research
initiative on human nutrition intervention and health
promotion.
(b) Emphasis of Initiative.--In administering human
nutrition research projects under this section, the Secretary
shall give specific emphasis to--
(1) coordinated longitudinal research assessments of
nutritional status; and
(2) the implementation of unified, innovative
intervention strategies,
to identify and solve problems of nutritional inadequacy and
contribute to the maintenance of health, well-being,
performance, and productivity of individuals, thereby reducing
the need of the individuals to use the health care system and
social programs of the United States.
(c) Administration of Funds.--The Administrator of the
Agricultural Research Service shall administer funds made
available to carry out this section to ensure a coordinated
approach to health and nutrition research efforts.
(d) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 1996 through [2002] 2006.
* * * * * * *
SEC. 1424A. PILOT RESEARCH PROGRAM TO COMBINE MEDICAL AND AGRICULTURAL
RESEARCH.
(a) Findings.--Congress finds the following:
* * * * * * *
(d) Authorization of Appropriations.--There are authorized
to be appropriated $10,000,000 for each of fiscal years 1997
through [2002] 2006 to carry out the pilot program.
* * * * * * *
nutrition education program
Sec. 1425. (a) The Secretary shall establish a national
education program which shall include, but not be limited to,
the dissemination of the results of food and human nutrition
research performed or funded by the Department of Agriculture.
* * * * * * *
(ii) the remainder shall be allocated
to each State in an amount which bears
the same ratio to the total amount to
be allocated under this subparagraph as
the population of the State living at
or below 125 per centum of the income
poverty guidelines prescribed by the
Office of Management and Budget
(adjusted pursuant to section 673(2) of
the Omnibus Budget Reconciliation Act
of 1981 (42 U.S.C. 9902)), bears to the
total population of all the States
living at or below 125 per centum of
the income poverty guidelines, as
determined by the last preceding
decennial census at the time each such
additional amount is first
appropriated. The provisions of this
subparagraph shall not preclude the
Secretary from developing educational
materials and programs for persons in
income ranges above the level
designated in this subparagraph.
(3) There is authorized to be appropriated to carry
out the expanded food and nutrition education program
established under section 3(d) of the Act of May 8,
1914 (38 Stat. 373, chapter 79; 7 U.S.C. 343(d) and
this section, $83,000,000 for each of fiscal years 1996
through [2002] 2006.
* * * * * * *
Sec. 1433. (a) There are authorized to be appropriated such
funds as Congress may determine necessary to support continuing
animal health and disease research programs at eligible
institutions, but not to exceed $25,000,000 for each of the
fiscal years 1991 through [2002] 2006, and not in excess of
such sums as may after the date of enactment of this title be
authorized by law for any subsequent fiscal year. Funds
appropriated under this section shall be used: (1) to meet
expenses of conducting animal health and disease research,
publishing and disseminating the results of such research, and
contributing to the retirement of employees subject to the
provisions of the Act of March 4, 1940 (54 Stat. 39-40, as
amended; 7 U.S.C. 331); (2) for administrative planning and
direction; and (3) to purchase equipment and supplies necessary
for conducting such research.
* * * * * * *
Sec. 1434. (a) There are authorized to be appropriated such
funds as Congress may determine necessary to support research
on specific national or regional animal health or disease
problems, or national or regional problems relating to pre-
harvest, on-farm food safety, or animal well-being, but not to
exceed $35,000,000 for each of the fiscal years 1991 through
[2002] 2006, and not in excess of such sums as may after the
date of enactment of this title be authorized by law for any
subsequent fiscal year.
(b) Notwithstanding the provisions of section 1435 of this
title, funds appropriated under this section shall be awarded
in the form of grants, for periods not to exceed five years, to
State agricultural experiment stations, colleges and
universities, other research institutions and organizations,
Federal agencies, private organizations or corporations, and
individuals.
* * * * * * *
SEC. 1444. EXTENSION AT 1890 LAND-GRANT COLLEGES, INCLUDING TUSKEGEE
UNIVERSITY.
[(a) There] (a) Authorization of Appropriations.--
(1) In general.--There are hereby authorized to be
appropriated annually such sums as Congress may
determine necessary to support continuing agricultural
and forestry extension at colleges eligible to receive
funds under the Act of August 30, 1890 (26 Stat. 417-
419, as amended; 7 U.S.C. 321-326 and 328), including
Tuskegee University (hereinafter in this section
referred to as ``eligible institutions''). [Beginning
with the fiscal year ending September 30, 1979, and
ending with the fiscal year ending September 30, 1981,
there shall be appropriated under this section for each
fiscal year an amount not less than 4 per centum of the
total appropriations for such year under the Act of May
8, 1914 (38 Stat. 372-374, as amended; 7 U.S.C. 341-
349): Provided, That the amount appropriated for the
fiscal year ending September 30, 1979, shall not be
less than the amount made available for the fiscal year
ending September 30, 1978, to such eligible institutions
under section 3(d) of the Act of May 8, 1914 (38 Stat.
373, as amended; 7 U.S.C. 343(d)). Beginning with the fiscal
year ending September 30, 1982, there shall be appropriated
under this section an amount not less than 5\1/2\ per
centum, and for each fiscal year thereafter an amount not
less than 6 per centum] the following;
(2) Minimum amount._Beginning with fiscal year 2002,
there shall be appropriated under this section for each
fiscal year an amount that is not less than 15 percent
of the total appropriations for such year under the Act
of May 8, 1914 (7 U.S.C. 341 et seq.), and related acts
pertaining to cooperative extension work at the land-
grant institutions identified in the Act of May 8, 1914
(38 Stat. 372, chapter 79; 7 U.S.C. 341 et seq.),
except that for the purpose of this calculation, the
total appropriations shall not include amounts made
available after September 30, 1995, under section 3(d)
of that Act (7 U.S.C. 343(d)), to carry out programs or
initiatives for which no funds were made available
under section 3(d) of that Act for fiscal year 1995, or
any previous fiscal year, as determined by the
Secretary, and shall not include amounts made available
after September 30, 1995, to carry out programs or
initiatives funded under section 3(d) of that Act prior
to that date that are in excess of the highest amount
made available for the programs or initiatives for
fiscal year 1995, or any previous fiscal year, as
determined by the Secretary. [Funds appropriated]
(3) Uses.--Funds appropriated; and under this section
shall be used for expenses of conducting extension
programs and activities, and for contributing to the
retirement of employees subject to the provisions of
the Act of March 4, 1940 (54 Stat. 30-40, as amended; 7
U.S.C. 331). [No more]
(4) Carryover.--No more than 20 per centum of the
funds received by an institution in any fiscal year may
be carried forward to the succeeding fiscal year.
SEC. 1445. AGRICULTURAL RESEARCH AT 1890 LAND-GRANT COLLEGES, INCLUDING
TUSKEGEE UNIVERSITY.
[(a) There] (a) Authorization of Appropriations._
(1) In general.--There are hereby authorized to be
appropriated annually such sums as Congress may
determine necessary to support continuing agricultural
research at colleges eligible to receive funds under
the Act of August 30, 1890 (26 Stat. 417-419, as
amended; 7 U.S.C. 321-326 and 328), including Tuskegee
University (hereinafter referred to in this section as
``eligible institutions''). [Beginning with the fiscal
year ending September 30, 1979, there shall be
appropriated under this section for each fiscal year an
amount not less than 15 per centum of the total
appropriations for such year under section 3 of the Act
of March 2, 1887 (24 Stat. 441, as amended; 7 U.S.C.
361c): Provided, That the amount appropriated for the
fiscal year ending September 30, 1979, shall not be
less than the amount made available in the fiscal year
ending September 30, 1978, to such eligible
institutions under the Act of August 4, 1965 (79 Stat.
431, 7 U.S.C. 450i).]
(2) Minimum amount._Beginning with fiscal year 2002,
there shall be appropriated under this section for each
fiscal year an amount that is not less than 25 percent
of the total appropriations for the fiscal year under
section 3 of the Hatch Act of 1887 (7 U.S.C. 361c).
(3) Uses._Funds appropriated under this section shall
be used for expenses of conducting agricultural
research, printing, disseminating the results of such
research, contributing to the retirement of employees
subject to the provisions of the Act of March 4, 1940
(54 Stat. 39-40, as amended; 7 U.S.C. 331),
administrative planning and direction, and purchase and
rental of land and the construction, acquisition,
alteration, or repair of buildings necessary for
conducting agricultural research. [The eligible]
(4) Coordination._The eligible institutions are
authorized to plan and conduct agricultural research in
cooperation with each other and such agencies,
institutions, and individuals as may contribute to the
solution of agricultural problems, and moneys
appropriated pursuant to this section shall be
available for paying the necessary expenses of
planning, coordinating, and conducting such cooperative
research. [No more (5) Carryover.--No more than 5
percent of the funds received by an institution in any
fiscal year, under this section, may be carried forward
to the succeeding fiscal year.]
(5) Carryover._
(A) In general._The balance of any annual
funds provided to an eligible institution for a
fiscal year under this section that remains
unexpended at the end of the fiscal year may be
carried over for use during the following
fiscal year.
(B) Failure to expend full amount._If any
unexpended balance carried over by an eligible
institution is not expended by the end of the
second fiscal year, an amount equal to the
unexpended balance shall be deducted from the
next succeeding annual allotment to the
eligible institution.
(b) Beginning with the fiscal year ending September 30,
1979, the funds appropriated in each fiscal year under this
section shall be distributed as follows:
* * * * * * *
(E) The manner in which research and
extension, including research and extension
activities funded other than through formula
funds, will cooperate to address the critical
issues in the State, including the activities
to be carried out separately, the activities to
be carried out sequentially, and the activities
to be carried out jointly.
(F) The technology transfer activities
conducted with respect to federally-funded
agricultural research.
(4) Research protocols.--
* * * * * * *
SEC. 1447. GRANTS TO UPGRADE AGRICULTURAL AND FOOD SCIENCES FACILITIES
AT 1890 LAND-GRANT COLLEGES, INCLUDING TUSKEGEE
UNIVERSITY.
(a) Purpose.--It is hereby declared to be the intent of
Congress to assist the institutions eligible to receive funds
under the Act of August 30, 1890, including Tuskegee University
(hereafter referred to in this section as ``eligible
institutions'') in the acquisition and improvement of
agricultural and food sciences facilities and equipment,
including libraries, so that the eligible institutions may
participate fully in the production of human capital.
(b) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary of Agriculture for the
purposes of carrying out the provisions of this section,
[$15,000,000 for each of fiscal years 1996 through 2002]
$25,000,000 for each of fiscal years 2002 through 2006, and
such sums shall remain available until expended.
(c) Use of Grant Funds.--Four percent of the sums
appropriated pursuant to this section shall be available to the
Secretary for administration of this grants program. The
remaining funds shall be available for grants to eligible
institutions for the purpose of assisting them in the purchase
of equipment and land, the planning, construction, alteration,
or renovation of buildings to strengthen their capacity in the
production of human capital in the food and agricultural
sciences and can be used at the discretion of the eligible
institutions in the areas of research, extension, and resident
instruction or any combination thereof.
* * * * * * *
SEC. 1448. NATIONAL RESEARCH AND TRAINING CENTENNIAL CENTERS.
(a) Competitive Grants Authorized.--The Secretary of
Agriculture may make a competitive grant to five national
research and training centennial centers located at colleges
(or a consortia of such colleges) eligible to receive funds
under the Act of August 30, 1890 (7 U.S.C. 321 et seq.),
including Tuskegee University, that--
(1) have been designated by the Secretary for the
fiscal years 1991 through 1995, or fiscal years 1996
through [2002] 2006, as national research and training
centennial centers; and
(2) have the best demonstrable capacity, as
determined by the Secretary, to provide administrative
leadership as--
* * * * * * *
(f) Authorization of Appropriations.--There are authorized
to be appropriated $2,000,000 for each of the fiscal years 1991
through [2002] 2006 for grants under this section.
(g) Center Defined.--For purposes of this section, the term
``center'' means a national research and training centennial
center that receives a grant under this subsection.
* * * * * * *
SEC. 1449. MATCHING FUNDS REQUIREMENT FOR RESEARCH AND EXTENSION
ACTIVITIES AT ELIGIBLE INSTITUTIONS.
(a) Definitions.--In this section:
(1) Eligible institution.--The term ``eligible
institution'' means a college eligible to receive funds
under the Act of August 30, 1890 (7 U.S.C. 321 et seq.)
(commonly known as the ``Second Morrill Act''),
including Tuskegee University.
(2) Formula funds.--The term ``formula funds'' means
the formula allocation funds distributed to eligible
institutions under sections 1444 and 1445.
(b) Determination of Non-Federal Sources of Funds.--Not
later than September 30, 1999, each eligible institution shall
submit to the Secretary a report describing for fiscal year
1999--
(1) the sources of non-Federal funds made available
by the State to the eligible institution for
agricultural research, extension, and education to meet
the requirements of this section; and
(2) the amount of such funds generally available from
each source.
[(c) Matching Formula.--Notwithstanding any other provision
of this subtitle, the distribution of formula funds to an
eligible institution shall be subject to the following matching
requirements:
[(1) For fiscal year 2000, the State shall provide
matching funds from non-Federal sources in an amount
equal to not less than 30 percent of the formula funds
to be distributed to the eligible institution.
[(2) For fiscal year 2001, the State shall provide
matching funds from non-Federal sources in an amount
equal to not less than 45 percent of the formula funds
to be distributed to the eligible institution.
[(3) For fiscal year 2002 and each fiscal year
thereafter, the State shall provide matching funds from
non-Federal sources in an amount equal to not less than
50 percent of the formula funds to be distributed to
the eligible institution.
[(d) Limited Waiver Authority.--
[(1) Fiscal year 2000.--Notwithstanding subsection
(f), the Secretary may waive the matching funds
requirement under subsection (c)(1) for fiscal year
2000 for an eligible institution of a State if the
Secretary determines that, based on the report received
under subsection (b), the State will be unlikely to
satisfy the matching requirement.
[(2) Future fiscal years.--The Secretary may not
waive the matching requirement under subsection (c) for
any fiscal year other than fiscal year 2000.]
(c) Matching Formula.--
(1) In general.--For each of fiscal years 2003
through 2006, the State shall provide matching funds
from non-Federal sources.
(2) Amount.--The amount of the matching funds shall
be equal to not less than--
(A) for fiscal year 2003, 60 percent of the
formula funds to be distributed to the eligible
institution; and
(B) for each of fiscal years 2004 through
2006, 110 percent of the amount required under
this paragraph for the preceding fiscal year.
(d) Waivers.--Notwithstanding subsection (f), for any of
fiscal years 2003 through 2006, the Secretary may waive the
matching funds requirement under subsection (c) for any amount
above the level of 50 percent for an eligible institution of a
State if the Secretary determines that the State will be
unlikely to meet the matching requirement.
(e) Use of Matching Funds.--Under terms and conditions
established by the Secretary, matching funds provided as
required by subsection (c) may be used by an eligible
institution for agricultural research, extension, and education
activities.
* * * * * * *
SEC. 1455. EDUCATION GRANTS PROGRAMS FOR HISPANIC-SERVING INSTITUTIONS.
(a) Grant Authority.--The Secretary may make competitive
grants (or grants without regard to any requirement for
competition) to Hispanic-serving institutions for the purpose
of promoting and strengthening the ability of Hispanic-serving
institutions to carry out education, applied research, and
related community development programs.
* * * * * * *
(c) Authorization of Appropriations.--There are authorized
to be appropriated to make grants under this section
$20,000,000 for each of fiscal years 1997 through [2002] 2006.
* * * * * * *
SEC. 1462. LIMITATION ON INDIRECT COSTS FOR AGRICULTURAL RESEARCH,
EDUCATION, AND EXTENSION PROGRAMS.
(a) In General._Except as otherwise provided in law,
indirect costs charged against a competitive agricultural
research, education, or extension grant awarded under this Act
or any other Act pursuant to authority delegated to the Under
Secretary of Agriculture for Research, Education, and Economics
shall not exceed [19 percent of the total Federal funds
provided under the grant award, as determined by the Secretary]
the negotiated indirect cost rate established for an
institution by the cognizant Federal audit agency for the
institution.
(b) Exception.--Subsection (a) shall not apply to a grant
awarded competitively under section 9 of the Small Business Act
(15 U.S.C. 638).
SEC. 1462A. RESEARCH EQUIPMENT GRANTS.
(a) In General.--The Secretary may make competitive grants
for the acquisition of special purpose scientific research
equipment for use in the food and agricultural sciences
programs of eligible institutions described in subsection (b).
(b) Eligible Institutions.--The Secretary may make a grant
under this section to--
(1) a college or university; or
(2) a State cooperative institution.
(c) Maximum Amount.--The amount of a grant made to an
eligible institution under this section may not exceed
$500,000.
(d) Prohibition on Charge of Equipment as Indirect Costs.--
The cost of acquisition or depreciation of equipment purchased
with a grant under this section shall not be--
(1) charged as an indirect cost against another
Federal grant; or
(2) included as part of the indirect cost pool for
purposes of calculating the indirect cost rate of an
eligible institution.
(e) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $50,000,000 for
each of fiscal years 2002 through 2006.
authorization for appropriations for existing and certain new
agricultural research programs
Sec. 1463. (a) Notwithstanding any authorization for
appropriations for agricultural research in any Act enacted
prior to the date of enactment of this title, there are hereby
authorized to be appropriated for the purposes of carrying out
the provisions of this title, except sections 1417, 1419, 1420,
and the competitive grants program provided for in section
1414, and except that the authorization for moneys provided
under the Act of March 2, 1887 (24 Stat. 440-442, as amended; 7
U.S.C. 361a-361i), is excluded and is provided for in
subsection (b) of this section, [$850,000,000 for each of the
fiscal years 1991 through 2002] $1,500,000,000 for each of
fiscal years 2002 through 2006.
(b) Notwithstanding any authorization for appropriations
for agricultural research at State agricultural experiment
stations in any Act enacted prior to the date of enactment of
this title, there are hereby authorized to be appropriated for
the purpose of conducting agricultural research at State
agricultural experiment stations pursuant to the Act of March
2, 1887 (24 Stat. 440-442, as amended; 7 U.S.C. 361a-361i),
$310,000,000 for each of the fiscal years 1991 through [2002]
2006.
(c) Notwithstanding any other provision of law effective
beginning October 1, 1983, not less than 25 per centum of the
total funds appropriated to the Secretary in any fiscal year
for the conduct of the cooperative research program provided
for under the Act of March 2, 1887, commonly known as the Hatch
Act (7 U.S.C. 361a et seq.); the cooperative forestry research
program provided for under the Act of October 10, 1962,
commonly known as the McIntire-Stennis Act (16 U.S.C. 582a et
seq.); the special and competitive grants programs provided for
in sections 2(b) and 2(c) of the Act of August 4, 1965 (7
U.S.C. 450i); the animal health research program provided for
under sections 1433 and 1434 of this title; the native latex
research programprovided for in the Native Latex
Commercialization and Economic Development Act of 1978 (7 U.S.C. 178 et
seq.); and the research provided for under various statutes for which
funds are appropriated under the Agricultural Research heading or a
successor heading, shall be appropriated for research at State
agricultural experiment stations pursuant to the provision of the Act
of March 2, 1887.
authorization for appropriations for extension education
Sec. 1464. Notwithstanding any authorization for
appropriations for the Cooperative Extension Service in any Act
enacted prior to the date of enactment of this title, there are
hereby authorized to be appropriated for the purposes of
carrying out the extension programs of the Department of
Agriculture [$420,000,000 for fiscal year 1991, $430,000,000
for fiscal year 1992, $440,000,000 for fiscal year 1993,
$450,000,000 for fiscal year 1994, and $460,000,000 for each of
fiscal years 1995 through 2002.] $500,000,000 for each of
fiscal years 2003 through 2006.
* * * * * * *
SEC. 1469A. AVAILABILITY OF COMPETITIVE GRANT FUNDS.
Except as otherwise provided by law, funds made available
to the Secretary to carry out a competitive agricultural
research, education, or extension grant program under this or
any other Act shall be available for obligation for a 2-year
period beginning on October 1 of the fiscal year for which the
funds are made available.
* * * * * * *
SEC. 1473B. JOINT REQUESTS FOR PROPOSALS.
(a) In General.--In carrying out any competitive
agricultural research, education, or extension grant program
authorized under this or any other Act, the Secretary may
cooperate with 1 or more other Federal agencies (including the
National Science Foundation) in issuing joint requests for
proposals, awarding grants, and administering grants, for
similar or related research, education, or extension projects
or activities.
(b) Transfer of Funds.--
(1) Secretary.--The Secretary may transfer funds to,
or receive funds from, a cooperating Federal agency for
the purpose of carrying out the joint request for
proposals, making awards, or administering grants.
(2) Cooperating agency.--The cooperating Federal
agency may transfer funds to, or receive funds from,
the Secretary for the purpose of carrying out the joint
request for proposals, making awards, or administering
grants.
(3) Limitations.--Funds transferred or received under
this subsection shall be--
(A) used only in accordance with the laws
authorizing the appropriation of the funds; and
(B) made available by grant only to
recipients that are eligible to receive the
grant under the laws.
(c) Administration.--
(1) Secretary.--The Secretary may delegate authority
to issue requests for proposals, make grant awards, or
administer grants, in whole or in part, to a
cooperating Federal agency.
(2) Cooperating federal agency.--The cooperating
Federal agency may delegate to the Secretary authority
to issue requests for proposals, make grant awards, or
administer grants, in whole or in part.
(d) Regulations; Rates.--The Secretary and a cooperating
Federal agency may agree to make applicable to recipients of
grants--
(1) the post-award grant administration regulations
and indirect cost rates applicable to recipients of
grants from the Secretary; or
(2) the post-award grant administration regulations
and indirect cost rates applicable to recipients of
grants from thecooperating Federal agency.
(e) Joint Peer Review Panels.--Subject to section 1413B,
the Secretary and a cooperating Federal agency may establish
joint peer review panels for the purpose of evaluating grant
proposals.
supplemental and alternative crops
Sec. 1473D. (a) Notwithstanding any other provision of law,
during the period beginning October 1, 1986, and ending
September 30, [2002] 2006, the Secretary shall develop and
implement a research project for the development of
supplemental and alternative crops, using such funds as are
appropriated to the Secretary each fiscal year under this
title.
* * * * * * *
authorization for appropriations
Sec. 1477. There is authorized to be appropriated
$7,500,000 for each of the fiscal years 1991 through [2002]
2006. Funds appropriated under this section or section 1476 may
not be used to acquire or construct a building.
* * * * * * *
appropriations
Sec. 1483. (a) There are authorized to be appropriated, to
implement the provisions of this subtitle, such sums not to
exceed $10,000,000 for each of the fiscal years 1991 through
[2002] 2006.
(b) Funds appropriated under this section shall be
allocated by the Secretary to eligible institutions for work to
be done as mutually agreed upon between the Secretary and the
eligible institution or institutions.
* * * * * * *
Subtitle N--Biosecurity
CHAPTER 1--AGRICULTURE INFRASTRUCTURE SECURITY
SEC. 1484. DEFINITIONS.
In this chapter:
(1) Agricultural research facility.--The term
``agricultural research facility'' means a facility--
(A) at which agricultural research is
regularly carried out or proposed to be carried
out; and
(B) that is--
(i)(I) an Agricultural Research
Service facility;
(II) a Forest Service facility; or
(III) an Animal and Plant Health
Inspection Service facility;
(ii) a Federal agricultural facility
in the process of being planned or
being constructed; or
(iii) any other facility under the
full control of the Secretary.
(2) Commission.--The term ``Commission'' means the
Agriculture Infrastructure Security Commission
established under section 1486.
(3) Fund.--The term ``Fund'' means the Agriculture
Infrastructure Security Fund Account established by
section 1485.
SEC. 1485. AGRICULTURE INFRASTRUCTURE SECURITY FUND.
(a) Establishment.--There is established in the Treasury of
the United States an account, to be known as the ``Agriculture
Infrastructure Security Fund Account'', consisting of funds
appropriated to, or deposited into, the Fund under subsection
(c).
(b) Purposes.--The purposes of the Fund are to provide
funding to protect and strengthen the Federal food safety and
agricultural infrastructure that--
(1) safeguards against animal and plant diseases and
pests;
(2) ensures the safety of the food supply; and
(3) ensures sound science in support of food and
agricultural policy.
(c) Deposits Into Fund.--
(1) In general.--There are authorized to be
appropriated to the Fund such sums as are necessary for
each of fiscal years 2002 through 2006.
(2) Contributions and other proceeds.--The Secretary
shall deposit into the Fund any funds received--
(A) as proceeds from the sale of assets under
subsection (e); or
(B) as gifts under subsection (f).
(3) Availability of funds.--Amounts in the Fund shall
remain available until expended without further Act of
appropriation.
(4) Additional funds.--Funds made available under
paragraph (1) shall be in addition to funds otherwise
available to the Secretary to receive gifts and
bequests or dispose of property (real, personal, or
intangible).
(d) Expenditures From Fund.--
(1) In general.--Subject to paragraph (2), on request
by the Secretary, the Secretary of the Treasury shall
transfer from the Fund to the Secretary, and the
Secretary shall accept and use without further
appropriation, such amounts as the Secretary determines
to be necessary to pay--
(A) the costs of planning, design,
development, construction, acquisition,
modernization, leasing, and disposal of
facilities, equipment, and technology used by
the Department in carrying out programs
relating to the purposes specified in
subsection (b), notwithstanding the Federal
Property and Administrative Services Act of
1949 (40 U.S.C. 471 et seq.) or any other law
that prescribes procedures for the procurement,
use, or disposal of property or services by a
Federal agency;
(B) the costs of specialized services
relating to the purposes specified in
subsection (b);
(C) the costs of cooperative arrangements
authorized to be entered into (notwithstanding
chapter 63 of title 31, United States Code)
with State, local and tribal governments, and
other public and private entities, to carry out
programs relating to the purposes specified in
subsection (b); and
(D) administrative costs incurred in carrying
out subparagraphs (A) through (C).
(2) Limitations.--
(A) Federal employees.--Amounts in the Fund
shall not be used to create any new full or
part-time permanent Federal employee position.
(B) Administrative expenses.--Beginning in
fiscal year 2003, not more than 1 percent of
the amounts in the Fund on October 1 of a
fiscal year may be used in the fiscal year for
administrative expenses of the Secretary in
carrying out the activities described in
paragraph (1).
(e) Sale of Assets.--
(1) Disposal authority.--Notwithstanding the Federal
Property and Administrative Services Act of 1949 (40
U.S.C. 471 et seq.), the Secretary by sale may dispose
of all or any part of any right or title in land
(excluding National Forest System land), facilities, or
equipment in the full control of the Department
(including land and facilities at the Beltsville
Agricultural Research Center) used for the purposes
specified in subsection (b).
(2) Disposition of proceeds.--Proceeds from any sale
conducted by the Secretary under paragraph (1) shall be
deposited into the Fund in accordance with subsection
(c)(2)(A).
(f) Gifts.--
(1) In general.--To carry out the purposes specified
in subsection (b), the Secretary may accept gifts and
bequests of funds, property (real, personal, and
intangible), equipment, services, and other in-kind
contributions from State, local, and tribal
governments, colleges and universities, individuals,
and other public and private entities.
(2) Prohibited source.--
(A) In general.--For the purposes of this
subsection, the Secretary shall not consider a
State or local government, Indian tribe (as
defined in section 4 of the Indian Self-
Determination and Education Assistance Act (25
U.S.C. 450b)), other public entity, or college
or university, to be a prohibited source under
any Department rule or policy that prohibits
the acceptance of gifts from individuals and
entities that do business with the Department.
(B) Exception.--Notwithstanding any
Department rule or policy that prohibits the
acceptance of gifts by the Department from
individuals or private entities that do
business with the Department or that, for any
other reason, are considered to be prohibited
sources, the Secretary may accept gifts under
this subsection if the Secretary determines
that it is in the public interest to accept the
gift.
(3) Disposition of gifts.--The Secretary shall
deposit any gift of funds under this subsection into
the Fund in accordance with subsection (c)(2)(B).
SEC. 1486. AGRICULTURE INFRASTRUCTURE SECURITY COMMISSION.
(a) Establishment.--The Secretary shall establish a
commission to be known as the ``Agriculture Infrastructure
Security Commission'' to carry out the duties described in
subsection (f).
(b) Membership.--
(1) Appointment.--
(A) Voting members.--
(i) In general.--The Commission shall
be composed of 15 voting members,
appointed by the Secretary in
accordance with clause (ii), based on
nominations solicited from the public.
(ii) Qualifications.--The Secretary
shall appoint members that--
(I) represent a balance of
the public and private sectors;
and
(II) have combined expertise
in--
(aa) facilities
development,
modernization,
construction, security,
consolidation, and
closure;
(bb) plant diseases
and pests;
(cc) animal diseases
and pests;
(dd) food safety;
(ee) biosecurity;
(ff) the needs of
farmers and ranchers;
(gg) public health;
(hh) State, local,
and tribal government;
and
(ii) any other area
related to agriculture
infrastructure
security, as determined
by the Secretary.
(B) Nonvoting members.--The Commission shall
be composed of the following nonvoting members:
(i) The Secretary.
(ii) 4 representatives appointed by
the Secretary of Health and Human
Services, 1 each from--
(I) the Public Health
Service;
(II) the National Institutes
of Health;
(III) the Centers for Disease
Control and Prevention; and
(IV) the Food and Drug
Administration.
(iii) 1 representative appointed by
the Attorney General.
(iv) 1 representative appointed by
the Director of Homeland Security.
(v) Not more than 4 representatives
of the Department appointed by the
Secretary.
(2) Date of appointment.--The appointment of each
member of the Commission shall be made not later than
90 days after the date of enactment of this subtitle.
(c) Term; Vacancies.--
(1) Term.--The term of office of a member of the
Commission shall be 4 years, except that the members
initially appointed shall be appointed to serve
staggered terms (as determined by the Secretary).
(2) Vacancies.--A vacancy on the Commission shall be
filled in the same manner as the original appointment
was made.
(d) Meetings.--
(1) In general.--The Commission shall meet at the
call of--
(A) the Chairperson;
(B) a majority of the voting members of the
Commission; or
(C) the Secretary.
(2) Federal advisory committee act.--
(A) In general.--The Federal Advisory
Committee Act (5 U.S.C. App.) and title XVIII
of the Food and Agriculture Act of 1977 (7
U.S.C. 2281 et seq.) shall not apply to the
Commission.
(B) Open meetings; records.--Subject to
subparagraph (C)--
(i) a meeting of the Commission shall
be--
(I) publicly announced in
advance; and
(II) open to the public; and
(ii) the Commission shall--
(I) keep detailed minutes of
each meeting and other
appropriate records of the
activities of the Commission;
and
(II) make the minutes and
records available to the public
on request.
(C) Exception.--When required in the interest
of national security--
(i) the Chairperson may choose not to
give public notice of a meeting;
(ii) the Chairperson may close all or
a portion of any meeting to the public,
and the minutes of the meeting, or
portion of a meeting, shall not be made
available to the public; and
(iii) by majority vote, the
Commission may redact the minutes of a
meeting that was open to the public.
(e) Chairperson.--The Secretary shall select a Chairperson
from among the voting members of the Commission.
(f) Duties.--
(1) In general.--The Commission shall--
(A) advise the Secretary on the uses of the
Fund;
(B) review all agricultural research
facilities for--
(i) research importance; and
(ii) importance to agriculture
infrastructure security;
(C) identify any agricultural research
facility that should be closed, realigned,
consolidated, or modernized to carry out the
research agenda of the Secretary and protect
agriculture infrastructure security;
(D) develop recommendations concerning
agricultural research facilities; and
(E)(i) evaluate the agricultural research
facilities acquisition and modernization system
(including acquisitions by gift, grant, or any
other form of agreement) used by the
Department; and
(ii) based on the evaluation, recommend
improvements to the system.
(2) Strategic plan.--To assist the Commission in
carrying out the duties described in paragraph (1), the
Commission shall use the 10-year strategic plan
prepared by the Strategic Planning Task Force
established under section 4 of the Research Facilities
Act (7 U.S.C. 390b).
(3) Report.--
(A) In general.--Not later than 240 days
after the date of enactment of this subtitle,
and each June 1 thereafter, the Commission
shall prepare and submit to the Secretary, the
Committee on Agriculture and the Committee on
Appropriations of the House of Representatives,
and the Committee on Agriculture, Nutrition,
and Forestry and the Committee on
Appropriations of the Senate, a report on the
findings and recommendations under paragraph
(1).
(B) Written response.--Not later than 90 days
after the date of receipt of a report from the
Commission under subparagraph (A), the
Secretary shall provide to the Commission a
written response concerning the manner and
extent to which the Secretary will implement
the recommendations in the report.
(C) Public availability.--
(i) In general.--Subject to clause
(ii), the report submitted by the
Commission, and any response made by
the Secretary, under this subsection
shall be available to the public.
(ii) Exception.--
(I) National security.--The
Commission or the Secretary may
determine that any report or
response, or any portion of a
report or response, shall not
be publicly released in the
interest of national security.
(II) Freedom of information
act.--On such a determination,
the report or response, a
portion of the report or
response, or any records
relating to the report or
response, shall not be released
under section 552 of title 5,
United States Code.
(g) Commission Personnel Matters.--
(1) Compensation of members.--
(A) Non-federal employees.--A voting member
of the Commission who is not a regular full-
time employee of the Federal Government shall,
while attending meetings of the Commission or
otherwise engaged in the business of the
Commission (including travel time), be entitled
to receive compensation at a rate fixed by the
Secretary, but not exceeding the daily
equivalent of the annual rate specified at the
time of such service under GS-15 of the General
Schedule established under section 5332 of
title 5, United States Code.
(B) Travel expenses.--A voting member of the
Commission shall be allowed travel expenses,
including per diem in lieu of subsistence, at
rates authorized for an employee of an agency
under subchapter I of chapter 57 of title 5,
United States Code, while away from the home or
regular place of business of the member in the
performance of the duties of the Commission.
(2) Staff.--The Secretary shall provide the
Commission with any personnel and other resources as
the Secretary determines appropriate.
(h) Funding.--
(1) Authorization of appropriations.--There are
authorized to be appropriated to carry out this section
such sums as are necessary for each of fiscal years
2002 through 2006.
(2) Agriculture infrastructure security fund.--For
the purpose of establishing the Commission, the
Secretary shall use such sums from the Fund as the
Secretary determines to be appropriate.
CHAPTER 2--OTHER BIOSECURITY PROGRAMS
SEC. 1487. SPECIAL AUTHORIZATION FOR BIOSECURITY PLANNING AND RESPONSE.
(a) Authorization of Appropriations.--In addition to
amounts for agricultural research, extension, and education
under this Act, there are authorized to be appropriated for
agricultural research, education, and extension activities for
biosecurity planning and response such sums as are necessary
for each of fiscal years 2002 through 2006.
(b) Use of Funds.--Using any authority available to the
Secretary, the Secretary shall use funds made available under
this section to carry out agricultural research, education, and
extension activities (including through competitive grants)
necessary--
(1) to reduce the vulnerability of the United States
food and agricultural system to chemical or biological
attack;
(2) to continue joint research initiatives between
the Agricultural Research Service, universities, and
industry on counterbioterrorism efforts (including
continued funding of a consortium in existence on the
date of enactment of this subtitle of which the
Agricultural Research Service and universities are
members);
(3) to make competitive grants to universities and
qualified research institutions for research on
counterbioterrorism; and
(4) to counter or otherwise respond to chemical or
biological attack.
SEC. 1488. AGRICULTURE BIOTERRORISM RESEARCH FACILITIES.
(a) Definitions.--In this section:
(1) Construction.--The term ``construction''
includes--
(A) the construction of new buildings; and
(B) the expansion, renovation, remodeling,
and alteration of existing buildings.
(2) Cost.--
(A) In general.--The term ``cost'' means any
construction cost, including architects' fees.
(B) Exclusions.--The term ``cost'' does not
include the cost of--
(i) acquiring land or an interest in
land; or
(ii) constructing any offsite
improvement.
(3) Eligible entity.--The term ``eligible entity''
means a college or university that--
(A) is a land grant college or university (as
defined in section 1404 of the National
Agricultural Research, Extension, and Teaching
Policy Act of 1977 (7 U.S.C. 3103)); and
(B) as determined by the Secretary, has--
(i) demonstrated expertise in the
area of animal and plant diseases;
(ii) substantial animal and plant
diagnostic laboratories; and
(iii) well-established working
relationships with--
(I) the agricultural
industry; and
(II) farm and commodity
organizations.
(b) Modernization and Construction of Facilities.--
(1) In general.--To enhance the security of
agriculture in the United States against threats posed
by bioterrorism, the Secretary shall make construction
grants, on a competitive basis, to eligible entities.
(2) Limitation on grants.--An eligible entity shall
not receive grant funds under this section that, in any
fiscal year, exceed $10,000,000.
(c) Requirements for Grants.--
(1) In general.--The Secretary shall make a grant to
an eligible entity under this section only if, with
respect to any facility constructed using grant funds,
the eligible entity--
(A) submits to the Secretary, in such form,
in such manner, and containing such agreements,
assurances, and information as the Secretary
may require, an application for the grant;
(B) is determined by the Secretary to be
competent to engage in the type of research for
which the facility is proposed to be
constructed;
(C) provides such assurances as the Secretary
determines to be satisfactory that--
(i) for not less than 20 years after
the date of completion of the facility,
the facility shall be used for the
purposes of the research for which the
facility was constructed, as described
in the grant application;
(ii) sufficient funds are available
to pay the non-Federal share of the
cost of constructing the facility;
(iii) sufficient funds will be
available, as of the date of completion
of the construction, for the effective
use of the facility for the purposes of
the research for which the facility was
constructed; and
(iv) the proposed construction--
(I) will increase the
capability of the eligible
entity to conduct research for
which the facility was
constructed; or
(II) is necessary to improve
or maintain the quality of the
research of the eligible
entity;
(D) meets such reasonable qualifications as
may be established by the Secretary with respect
to--
(i) the relative scientific and
technical merit of the applications,
and the relative effectiveness of
facilities proposed to be constructed,
in expanding the quality of, and the
capacity of eligible entities to carry
out, biosecurity research;
(ii) the quality of the research to
be carried out in each facility
constructed;
(iii) the need for the research
activities to be carried out within the
facility as those activities relate to
research needs of the United States in
securing, and ensuring the safety of,
the food supply of the United States;
(iv) the age and condition of
existing research facilities of the
eligible entity; and
(v) biosafety and biosecurity
requirements necessary to protect
facility staff, members of the public,
and the food supply; and
(E) has demonstrated a commitment to
enhancing and expanding the research
productivity of the eligible entity.
(2) Priority.--In providing grants under this
section, the Secretary shall give priority to an
eligible entity that, as determined by the Secretary,
has demonstrated expertise in--
(A) animal and plant disease prevention;
(B) pathogen and toxin mitigation;
(C) cereal disease resistance;
(D) grain milling and processing;
(E) livestock production practices;
(F) vaccine development;
(G) meat processing;
(H) pathogen detection and control; or
(I) food safety.
(d) Amount of Grant.--The amount of a grant awarded under
this section shall be determined by the Secretary.
(e) Federal Share.--The Federal share of the cost of any
construction carried out using funds from a grant provided
under this section shall not exceed 50 percent.
(f) Guidelines.--Not later than 180 days after the date of
enactment of this subtitle, the Secretary shall issue
guidelines with respect to the provision of grants under this
section.
(g) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $100,000,000 for
each of fiscal years 2003 through 2005.
* * * * * * *
Subtitle 0--Land Grant Institutions in Insular Areas
SEC. 1489. DISTANCE EDUCATION GRANTS FOR INSULAR AREAS.
(a) In General.--The Secretary may make competitive or
noncompetitive grants to State cooperative institutions in
insular areas to strengthen the capacity of State cooperative
institutions to carry out distance food and agricultural
education programs using digital network technologies.
(b) Use.--Grants made under this section shall be used--
(1) to acquire the equipment, instrumentation,
networking capability, hardware and software, digital
network technology, and infrastructure necessary to
teach students and teachers about technology in the
classroom;
(2) to develop and provide educational services
(including faculty development) to prepare students or
faculty seeking a degree or certificate that is
approved by the State or a regional accrediting body
recognized by the Secretary of Education;
(3) to provide teacher education, library and media
specialist training, and preschool and teacher aid
certification to individuals who seek to acquire or
enhance technology skills in order to use technology in
the classroom or instructional process;
(4) to implement a joint project to provide education
regarding technology in the classroom with a local
educational agency, community-based organization,
national nonprofit organization, or business, including
a minority business or abusiness located in a HUB Zone
established under section 31 of the Small Business Act
(15 U.S.C. 657a); or
(5) to provide leadership development to
administrators, board members, and faculty of eligible
institutions with institutional responsibility for
technology education.
(c) Limitation on Use of Grant Funds.--Funds provided under
this section shall not be used for the planning, acquisition,
construction, rehabilitation, or repair of a building or
facility.
(d) Administration of Program.--The Secretary may carry out
this section in a manner that recognizes the different needs
and opportunities for State cooperative institutions in the
Atlantic and Pacific Oceans.
(e) Matching Requirement.--
(1) In general.--The Secretary may establish a
requirement that a State cooperative institution
receiving a grant under this section shall provide
matching funds from non-Federal sources in an amount
equal to not less than 50 percent of the grant.
(2) Waivers.--If the Secretary establishes a matching
requirement under paragraph (1), the requirement shall
include an option for the Secretary to waive the
requirement for an insular area State cooperative
institution for any fiscal year if the Secretary
determines that the institution will be unlikely to
meet the matching requirement for the fiscal year.
(f) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $4,000,000 for
each of fiscal years 2002 through 2006.
* * * * * * *
NATIONAL AGRICULTURAL RESEARCH, EXTENSION, AND TEACHING POLICY ACT
AMENDMENTS OF 1985
* * * * * * *
authorization for appropriations for federal agricultural research
facilities
Sec. 1431. There are authorized to be appropriated for each
of the fiscal years 1991 through [2002] 2006, such sums as may
be necessary for the planning, construction, acquisition,
alteration, and repair of buildings and other public
improvements, including the cost of acquiring or obtaining
rights to use land, of or used by the Agricultural Research
Service, except that--
(1) the cost of planning any one facility shall not
exceed $500,000; and
(2) the total cost of any one facility shall not
exceed $5,000,000.
* * * * * * *
RESEARCH FACILITIES ACT
* * * * * * *
SEC. 6. AUTHORIZATION OF APPROPRIATIONS.
(a) In General.--Subject to subsection (b), there are
authorized to be appropriated such sums as are necessary for
each of fiscal years 1996 through [2002] 2006 for the study,
plan, design, structure, and related costs of agricultural
research facilities under this Act.
(b) Allowable Administrative Costs.--Not more than 3
percent of the funds made available for any project for an
agricultural research facility shall be available for
administration of the project.
* * * * * * *
SMITH-LEVER ACT
* * * * * * *
Sec. 3.1. (a) There are hereby authorized to be
appropriated for the purposes of this Act such sums as Congress
may from time to time determine to be necessary.
* * * * * * *
(2) There is authorized to be appropriated for the
fiscal year ending June 30, 1971, and for each fiscal
year thereafter, for payment to the Virgin Islands and
Guam, $100,000 each, which sums shall be in addition to
the sums appropriated for the several States of the
United States and Puerto Rico under the provisions of
this section. The amount paid by the Federal Government
to the Virgin Islands and Guam pursuant to this paragraph
shall not exceed during any fiscal year, except the fiscal
years ending, June 30, 1971, and June 30, 1972, when such
amount may be used to pay the total cost of providing
services pursuant to this Act, the amount available and
budgeted for expenditure by the Virgin Islands and Guam
for the purposes of this Act.
[(3) There are authorized to be appropriated for the
fiscal year ending June 30, 1996, and for each fiscal
year thereafter, for payment on behalf of the 1994
Institutions (as defined in section 532 of the Equity
in Educational Land-Grant Status Act of 1994),
$5,000,000 for the purposes set forth in section 2.
Such sums shall be in addition to the sums appropriated
for the several States and Puerto Rico, the Virgin
Islands, and Guam under the provisions of this section.
Such sums shall be distributed on the basis of a
competitive application process to be developed and
implemented by the Secretary and paid by the Secretary
to 1994 Institutions (in accordance with regulations
that the Secretary may promulgate) and may be
administered by the 1994 Institutions through
cooperative agreements with colleges and universities
eligible to receive funds under the Act of July 2, 1862
(12 Stat. 503, chapter 130; 7 U.S.C. 301 et seq.), or
the Act of August 30, 1890 (26 Stat. 419, chapter 841;
7 U.S.C. 321 et seq.), including Tuskegee University,
located in any State.]
(3) Extension at 1994 institutions.--
(A) In general.--There are authorized to be
appropriated for fiscal year 2002 and each
subsequent fiscal year, for payment to 1994
Institutions (as defined in section 532 of the
Equity in Educational Land-Grant Status Act of
1994 (7 U.S.C. 301 note; Public Law 103-382)),
such sums as are necessary for the purposes set
forth in section 2, to remain available until
expended.
(B) Distribution.--Amounts made available
under subparagraph (A)--
(i) shall be distributed on the basis
of a formula to be developed and
implemented by the Secretary, in
consultation with the 1994
Institutions; and
(ii) may include payments for
extension activities carried out during
1 or more fiscal years.
(C) Cooperative agreement.--In accordance
with such regulations as the Secretary may
promulgate, a 1994 Institution may administer
funds received under this paragraph through a
cooperative agreement with an 1862 Institution
or an 1890 Institution (as those terms are
defined in section 2 of the Agricultural
Research, Extension, and Education Reform Act
of 1998 (7 U.S.C. 7601)).
(c) Any sums made available by the Congress or further
development of cooperative extension work in addition to those
referred to in subsection (b) hereof shall be distributed as
follows:
(1) Four per centum of the sum so appropriated for
each fiscal year shall be allotted to the Secretary of
Agriculture for administrative, technical, and other
services, and for coordinating the extension work of
the Department and the several States, Territories and
possessions.
* * * * * * *
(e) Matching Funds.--
(1) Requirement.--Except as provided in paragraph (4)
and subsection (f), no allotment shall be made to a
State under subsection (b) or (c), and no payments from
the allotment shall be made to a State, in excess of
the amount that the State makes available out of non-
Federal funds for cooperative extension work.
(2) Failure to provide matching funds.--If a State
fails to comply with the requirement to provide
matching funds for a fiscal year under paragraph (1),
the Secretary of Agriculture shall withhold from
payment to the State for that fiscal year an amount
equal to the difference between--
(A) the amount that would be allotted and
paid to the State under subsections (b) and (c)
(if the full amount of matching funds were
provided by the State); and
(B) the amount of matching funds actually
provided by the State.
(3) Reapportionment.--
(A) In general.--The Secretary of Agriculture
shall reapportion amounts withheld under
paragraph (2) for a fiscal year among the
States satisfying the matching requirement
for that fiscal year.
(B) Matching requirement.--Any
reapportionment of funds under this paragraph
shall be subject to the matching requirement
specified in paragraph (1).
[(4) Territories.--In lieu of the matching funds
requirement of paragraph (1), the Commonwealth of
Puerto Rico, the Virgin Islands, and Guam shall be
subject to the same matching funds requirements as
those applicable to an eligible institution under
section 1449 of the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 (7 U.S.C.
3222d).]
(4) Exception for insular areas.--
(A) In general.--Effective beginning for
fiscal year 2003, in lieu of the matching funds
requirement of paragraph (1), the insular areas
of the Commonwealth of Puerto Rico, Guam, and
the Virgin Islands of the United States shall
provide matching funds from non-Federal sources
in an amount equal to not less than 50 percent
of the formula funds distributed by the
Secretary to each of the insular areas,
respectively, under this section.
(B) Waivers.--The Secretary may waive the
matching fund requirement of subparagraph (A)
for any fiscal year if the Secretary determines
that the government of the insular area will be
unlikely to meet the matching requirement for
the fiscal year.
(f) Matching Funds Exception for 1994 Institutions.--There
shall be no matching requirement for funds made available to a
1994 Institution pursuant to subsection (b)(3).
(g)(1) The Secretary of Agriculture may conduct
educational, instructional, demonstration, and publication
distribution programs and enter into cooperative agreements
with private nonprofit and profit organizations and individuals
to share the cost of such programs through contributions from
private sources as provided in this subsection.
(2) The Secretary may receive contributions under this
subsection from private sources for the purposes described in
paragraph (1) and provide matching funds in an amount not
greater than 50 percent of such contributions.
[(h) Multistate Cooperative Extension Activities.--
[(1) In general.--Not less than the applicable
percentage specified under paragraph (2) of the amounts
that are paid to a State under subsections (b) and (c)
during a fiscal year shall be expended by States for
cooperative extension activities in which 2 or more
States cooperate to solve problems that concern more
than 1 State (referred to in this subsection as
``multistate activities'').
[(2) Applicable percentages.--
[(A) 1997 expenditures on multistate
activities.--Of the Federal formula funds that
were paid to each State for fiscal year 1997
under subsections (b) and (c), the Secretary of
Agriculture shall determine the percentage that
the State expended for multistate activities.
[(B) Required expenditures on multistate
activities.--Of the Federal formula funds that
are paid to each State for fiscal year 2000 and
each subsequent fiscal year under subsections
(b) and (c), the State shall expend for the
fiscal year for multistate activities a
percentage that is at least equal to the lesser
of--
[(i) 25 percent; or
[(ii) twice the percentage for the
State determined under subparagraph
(A).
[(C) Reduction by secretary.--The Secretary
may reduce the minimum percentage required to
be expended for multistate activities under
subparagraph (B) by a State in a case of
hardship, infeasibility, or other similar
circumstance beyond the control of the State,
as determined by the Secretary.
[(D) Plan of work.--The State shall include
in the plan of work of the State required under
section 4 a description of the manner in which
the State will meet the requirements of this
paragraph.
[(3) Applicability.--This subsection does not apply
to funds provided--
[(A) by a State or local government pursuant
to a matching requirement;
[(B) to a 1994 Institution (as defined in
section 532 of the Equity in Educational Land-
Grant Status Act of 1994 (Public Law 103-382; 7
U.S.C. 301 note)); or
[(C) to the Commonwealth of Puerto Rico, the
Virgin Islands, or Guam.]
(h) Multistate Cooperative Extension Activities.--
(1) Definition of multistate activity.--In this
subsection, the term ``multistate activity'' means a
cooperative extension activity in which 2 or more
States cooperate to resolve problems that concern more
than 1 State.
(2) Requirement.--
(A) In general.--To receive funding under
subsections (b) and (c) for a fiscal year, a
State, must have expended on multistate
activities, in the preceding fiscal year, an
amount equivalent to not less than 25 percent
of the funds paid to the State under
subsections (b) and (c) for the preceding
fiscal year.
(B) Determination of amount.--In determining
compliance with subparagraph (A), the Secretary
shall include all cooperative extension funds
expended by the State in the preceding fiscal
year, including Federal, State, and local
funds.
(3) Reduction of percentage.--The Secretary may
reduce the minimum percentage required to be expended
for multistate activities under paragraph (2) by a
State in a case of hardship, unfeasibility, or other
similar circumstances beyond the control of the State,
as determined by the Secretary.
(4) Plan of work.--The State shall include in the
plan of work of the State required under section 4 a
description of the manner in which the State will meet
the requirements of this subsection.
(5) Applicability.--This subsection does not apply to
funds provided--
(A) to a 1994 Institution (as defined in
section 532 of the Equity in Educational Land-
Grant Status Act of 1994 (7 U.S.C. 301 note;
Public Law 103-382)); or
(B) to the Commonwealth of Puerto Rico, the
Virgin Islands, or Guam.
[(i) Merit Review.--
[(1) Review required.--Effective October 1, 1999,
extension activity carried out under subsection (h)
shall be subject to merit review.
[(2) Other requirements.--An extension activity for
which merit review is conducted under paragraph (1)
shall be considered to have satisfied the requirements
for review under section 103(e) of the Agricultural
Research, Extension, and Education Reform Act of 1998.]
(i) Integrated Research and Extension Activities.--
(1) In general.--
(A) Requirement.--To receive funding under
this Act and subsections (b) and (c) of section
3 of the Smith-Lever Act (7 U.S.C. 343) for a
fiscal year, a State must have expended on
activities that integrate cooperative research
and extension (referred to in this section as
``integrated activities''), in the preceding
fiscal year, an amount equivalent to not less
than 25 percent of the funds paid to the State
under this section and subsections (b) and (c)
of section 3 of the Smith-Lever Act (7 U.S.C.
343) for the preceding fiscal year.
(B) Determination of amount.--In determining
compliance with subparagraph (A), the Secretary
shall include all cooperative research and
extension funds expended by the State in the
prior fiscal year, including Federal, State,
and local funds.
(2) Reduction of percentage.--The Secretary may
reduce the minimum percentage required to be expended
for integrated activities under paragraph (1) by a
State in a case of hardship, unfeasibility, or other
similar circumstances beyond the control of the State,
as determined by the Secretary.
(3) Plan of work.--The State shall include in the
plan of work of the State required under section 7 of
this Act and under section 4 of the Smith-Lever Act (7
U.S.C. 344), as applicable, a description of the manner
in which the State will meet the requirements of this
subsection.
(4) Applicability.--This subsection does not apply to
funds provided--
(A) to a 1994 Institution (as defined in
section 532 of the Equity in Educational Land-
Grant Status Act of 1994 (7 U.S.C. 301 note;
Public Law 103-382)); or
(B) to the Commonwealth of Puerto Rico, the
Virgin Islands, or Guam.
(5) Relationship to other requirements.--Funds
described in paragraph (1)(B) that a State uses to
calculate the required amount of expenditures for
integrated activities under paragraph (1)(A) may also
be used in the same fiscal year to calculate the amount
of expenditures for multistate activities required
under subsection (c)(3) of this section and section
3(h) of the Smith-Lever Act (7 U.S.C. 343(h)).
(j) Integration of Research and Extension.--Section 3(i) of
the Hatch Act of 1887 (7 U.S.C. 361c(i)) shall apply to amounts
made available to carry out this Act.
* * * * * * *
FEDERAL CROP INSURANCE ACT
* * * * * * *
SEC. 524. EDUCATION AND RISK MANAGEMENT ASSISTANCE.
(a) Education Assistance.--
(1) In general.--Subject to the amounts made
available under paragraph (4)--
(A) the Corporation shall carry out the
program established under paragraph (2); and
(B) the Secretary, acting through the
Cooperative State Research, Education, and
Extension Service, shall carry out the program
established under paragraph (3).
(2) Education and information.--The Corporation shall
establish a program under which crop insurance
education and information is provided to producers in
States in which (as determined by the Secretary)--
(A) there is traditionally, and continues to
be, a low level of Federal crop insurance
participation and availability; and
(B) producers are underserved by the Federal
crop insurance program.
(3) Partnerships for risk management education.--
[(A) Authority.--The Secretary, acting
through the Cooperative State Research,
Education, and Extension Service, shall
establish a program under which competitive
grants are made to qualified public and private
entities (including land grant colleges,
cooperative extension services, and colleges or
universities), as determined by the Secretary,
for the purpose of educating agricultural
producers about the full range of risk
management activities, including futures,
options, agricultural trade options, crop
insurance, cash forward contracting, debt
reduction, production diversification, farm
resources risk reduction, and other risk
management strategies.]
(A) Authority.--The Secretary, acting through
the Cooperative State Research, Education, and
Extension Service, shall establish a program
under which competitive grants are made to
qualified public and private entities
(including land-grant colleges and
universities, cooperative extension services,
colleges or universities, and community
colleges), as determined by the Secretary, for
the purpose of--
(i) educating producers generally
about the full range of risk management
activities, including futures, options,
agricultural trade options, crop
insurance, cash forward contracting,
debt reduction, production
diversification, farm resources risk
reduction, and other risk management
strategies; or
(ii) educating beginning farmers and
ranchers--
(I) in the areas described in
clause (i); and
(II) in risk management
strategies, as part of programs
that are specifically targeted
at beginning farmers and
ranchers.
(B) Basis for grants.--A grant under this
paragraph shall be awarded on the basis of
merit and shall be subject to peer or merit
review.
(C) Obligation period.--Funds for a grant
under this paragraph shall be available to the
Secretary for obligation for a 2-year period.
* * * * * * *
(2) Uses.--A producer may use cost share assistance
provided under this subsection to--
(A) construct or improve--
(i) watershed management structures;
or
(ii) irrigation structures;
(B) plant trees to form windbreaks or to
improve water quality;
(C) mitigate financial risk through
production diversification or resource
conservation practices, including--
(i) soil erosion control;
(ii) integrated pest management; or
(iii) transition to organic farming;
(D) enter into futures, hedging, or options
contracts in a manner designed to help reduce
production, price, or revenue risk;
(E) enter into agricultural trade options as
a hedging transaction to reduce production,
price, or revenue risk; or
(F) conduct any other activity related to the
activities described in subparagraphs (A)
through (E), as determined by the Secretary.
[(2)](3) Payment limitation.--The total amount of
payments made to a person (as defined in section
1001(5) of the Food Security Act (7 U.S.C. 1308(5)))
under this subsection for any year may not exceed
$50,000.
[(3)](4) Commodity credit corporation.--
(A) In general.--The Secretary shall carry
out this subsection through the Commodity
Credit Corporation.
(B) Funding.--The Commodity Credit
Corporation shall make available to carry out
this subsection $10,000,000 for fiscal year
2001 and each subsequent fiscal year.
* * * * * * *
SEC. 532. DEFINITION.
As used in this part, the term ``1994 institutions'' means
any one of the following colleges:
[(1) Bay Mills Community College.
[(2) Blackfeet Community College.
[(3) Cheyenne River Community College.
[(4) D-Q University.
[(5) Dulknife Memorial College.
[(6) Fond Du Lac Tribal and Community College.
[(7) Fort Belknap Community College.
[(8) Fort Berthold Community College.
[(9) Fort Peck Community College.
[(10) LacCourte Oreilles Ojibwa Community College.
[(11) Little Big Horn Community College.
[(12) Little Hoop Community College.
[(13) Nebraska Indian Community College.
[(14) Northwest Indian College.
[(15) Oglala Lakota College.
[(16) Salish Kootenai College.
[(17) Sinte Gleska University.
[(18) Sisseton Wahpeton Community College.
[(19) Standing Rock College.
[(20) Stonechild Community College.
[(21) Turtle Mountain Community College.
[(22) Navaho Community College.
[(23) United Tribes Technical College.
[(24) Southwest Indian Polytechnic Institute.
[(25) Institute of American Indian and Alaska Native
Culture and Arts Development.
[(26) Crowpoint Institute of Technology.
[(27) Haskell Indian Junior College.
[(28) Leech Lake Tribal College.
[(29) College of the Menominee Nation.
[(30) Little Priest Tribal College.]
(1) Bay Mills Community College.
(2) Blackfeet Community College.
(3) Cankdeska Cikana Community College.
(4) College of Menominee Nation.
(5) Crownpoint Institute of Technology.
(6) D-Q University.
(7) Dine *AE1 College.
(8) Dull Knife Memorial College.
(9) Fond du Lac Tribal and Community College.
(10) Fort Belknap College.
(11) Fort Berthold Community College.
(12) Fort Peck Community College.
(13) Haskell Indian Nations University.
(14) Institute of American Indian and Alaska Native
Culture and Arts Development.
(15) Lac Courte Oreilles Ojibwa Community College.
(16) Leech Lake Tribal College.
(17) Little Big Horn College.
(18) Little Priest Tribal College.
(19) Nebraska Indian Community College.
(20) Northwest Indian College.
(21) Oglala Lakota College.
(22) Salish Kootenai College.
(23) Sinte Gleska University.
(24) Sisseton Wahpeton Community College.
(25) Si Tanka/Huron University.
(26) Sitting Bull College.
(27) Southwestern Indian Polytechnic Institute.
(28) Stone Child College.
(29) Turtle Mountain Community College.
(30) United Tribes Technical College.
(31) White Earth Tribal and Community College.
* * * * * * *
SEC. 533. LAND GRANT STATUS FOR 1994 INSTITUTIONS.
(a) In General.--
* * * * * * *
(3) Accrediation.--To receive funding under sections
[534 and 535] 534, 535, and 536 [of this note], a 1994
Institution shall certify to the Secretary that the
1994 Institution.--
* * * * * * *
(b) Authorization of Appropriations.--There are authorized
to be appropriated [$4,600,000 for each of fiscal years 1996
through 2002] such sums as are necessary for each of fiscal
years 2002 through 2006. Amounts appropriated pursuant to this
section shall be held and considered to have been granted to
1994 Institutions to establish an endowment pursuant to
subsection (c).
* * * * * * *
(A) 60 percent of the adjusted income shall
be distributed among the 1994 Institutions on a
pro rata basis. The proportionate share of the
adjusted income received by a 1994 Institution
under this subparagraph shall be based on the
Indian student count [(as definded in section
390(3) of the Carl D. Perkins Vocational and
Applied Technology Education Act [section
2397h(3) of Title 20]),] (as defined in section
2(a) of the Tribally Controlled College or
University Assistance Act of 1978 (25 U.S.C.
1801(a)) as such section was in effect on the
day preceding the date of enactment of the Carl
D. Perkins Vocational and Applied Technology
Education Amendments of 1998 [Pub. L. 105-332,
Oct. 31, 1998, 112 Stat. 3076, which was
approved Oct. 31, 1998]) for each 1994
Institution for the fiscal year.
* * * * * * *
SEC. 534. APPROPRIATIONS.
(a) Authorization of Appropriations.--
(1) In general.--For fiscal year 1996, and for each
fiscal year thereafter, there are authorized to be
appropriated to the Department of the Treasury an
amount equal to--
(A) [$50,000;] $100,000 multiplied by
(B) the number of 1994 Institutions.
* * * * * * *
SEC. 535. INSTITUTIONAL CAPACITY BUILDING GRANTS.
(a) Definitions.--As used in this section:
(1) Federal share.--The term ``Federal share'' means,
with respect to a grant awarded under subsection (b),
the share of the grant that is provided from Federal
funds.
(2) Non-federal share.--The term ``non-Federal
share'' means, with respect to a grant awarded under
subsection (b), the matching funds paid with funds
other than funds referred to in paragraph (1), as
determined by the Secretary.
(3) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture.
(b) In General.--
(1) Institutional capacity building grants.--For each
of fiscal years 1996 through [2002,] 2006 the Secretary
shall make two or more institutional capacity building
grants to assist 1994 Institutions with constructing,
acquiring, and remodeling buildings, laboratories, and
other capital facilities (including fixtures and
equipment) necessary to conduct instructional
activities more effectively in agriculture and
sciences.
* * * * * * *
(c) Authorization of Appropriations.--There are authorized
to be appropriated to the Department of Agriculture to carry
out this section [$1,700,000 for each of fiscal years 1996
through 2002.''] such sums as are necessary for each of fiscal
years 2002 through 2006.
SEC. 536. RESEARCH GRANTS.
(a) Research Grants Authorized.--The Secretary of
Agriculture maymake grants under this section [of this note],
on the basis of a competitive application process (and in
accordance with such regulations as the Secretary may
promulgate), to a 1994 Institution to assist the Institution to
conduct agricultural research that addresses high priority
concerns of tribal, national, or multistate significance.
(b) Requirements.--Grant applications submitted under this
section [of this note] shall certify that the research to be
conducted will be performed under a cooperative agreement with
at least 1 other land-grant college or university (exclusive of
another 1994 Institution).
(c) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section for each of fiscal years 1994 through [2002] 2006.
Amounts appropriated shall remain available until expended.
* * * * * * *
TITLE 8
COOPERATIVE FORESTRY ASSISTANCE ACT OF 1978
* * * * * * *
SEC. 5A. SUSTAINABLE FORESTRY COOPERATIVE PROGRAM.
(a) Definitions.--In this section:
(1) Farmer or rancher.--The term ``farmer or
rancher'' means a person engaged in the production of
an agricultural commodity (including livestock).
(2) Forestry cooperative.--The term ``forestry
cooperative'' means an association that is--
(A) owned and operated by nonindustrial
private forest landowners; and
(B) comprised of members--
(i) of which at least 51 percent are
farmers or ranchers; and
(ii) that use sustainable forestry
practices on nonindustrial private
forest land to create a long-term,
sustainable income stream.
(3) Nonindustrial private forest land.--The term
``nonindustrial private forest land'' has the meaning
given the term ``nonindustrial private forest lands''
in section 5(c).
(b) Establishment.--The Secretary shall establish a
program, to be known as the ``sustainable forestry cooperative
program'', under which the Secretary shall provide, to
nonprofit organizations on a competitive basis, grants to
establish, and develop and support sustainable forestry
practices carried out by members of, forestry cooperatives.
(c) Use of Funds.--
(1) In general.--Subject to paragraph (2), funds from
a grant provided under this section shall be used for--
(A) predevelopment, development, start-up,
capital acquisition, and marketing costs
associated with a forestry cooperative; or
(B) the development or support of a
sustainable forestry practice of a member of a
forestry cooperative.
(2) Conditions.--
(A) Development.--The Secretary shall provide
funds under paragraph (1)(A) only to a
nonprofit organization with demonstrated
expertise in cooperative development, as
determined by the Secretary.
(B) Compliance with plan.--A sustainable
forestry practice developed or supported
through the use of funds from a grant under
this section shall comply with any applicable
standards for sustainable forestry contained in
a management plan that--
(i) meets the requirements of section
6A(g); and
(ii) is approved by the State
forester (or equivalent State
official).
(d) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this section, and on October 1,
2002, and each October 1 thereafter through October 1,
2005, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary of Agriculture to carry out
this section $2,000,000, to remain available until
expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
SEC. 5B. WATERSHED FORESTRY ASSISTANCE PROGRAM.
(a) Establishment.--Subject to the availability of
appropriations, the Secretary shall establish a watershed
forestry assistance program (referred to in this section as the
``program'') to provide to States, through State foresters (as
defined in section 6A), technical, financial, and related
assistance to--
(1) expand forest stewardship capacities and
activities through State forestry best management
practices and other means at the State level; and
(2) prevent water quality degradation, and address
watershed issues, on non-Federal forest land.
(b) Watershed Forestry Education, Technical Assistance, and
Planning.--
(1) Plan.--
(A) In general.--In carrying out the program,
the Secretary shall cooperate with State
foresters to develop a plan, to be administered
by the Secretary and implemented by State
foresters, to provide technical assistance to
assist States in preventing and mitigating
water quality degradation.
(B) Participation.--In developing the plan
under subparagraph (A), the Secretary shall
encourage participation of interested members
of the public (including nonprofit private
organizations and local watershed councils).
(2) Components.--The plan described in paragraph (1)
shall include provisions to--
(A) build and strengthen watershed
partnerships focusing on forest land at the
national, State, regional, and local levels;
(B) provide State forestry best management
practices and water quality technical
assistance directly to private landowners;
(C) provide technical guidance relating to
water quality management through forest
management in degraded watersheds to land
managers and policymakers;
(D)(i) complement State nonpoint source
assessment and management plans established
under section 319 of the Federal Water
Pollution Control Act (33 U.S.C. 1329); and
(ii) provide enhanced opportunities for
coordination and cooperation among Federal and
State agencies having responsibility for water
and watershed management under that Act; and
(E) provide enhanced forest resource data and
support for improved implementation of State
forestry best management practices, including--
(i) designing and conducting
effectiveness and implementation
studies; and
(ii) meeting in-State water quality
assessment needs, such as the
development of water quality models
that correlate the management of forest
land to water quality measures and
standards.
(c) Watershed Forestry Cost-Share Program.--
(1) Establishment.--In carrying out the program, the
Secretary shall establish a watershed forestry cost-
share program, to be administered by the Secretary and
implemented by State foresters, to provide grants and
other assistance for eligible programs and projects
described in paragraph (2).
(2) Eligible programs and projects.--A community,
nonprofit group, or landowner may receive a grant or
other assistance under this subsection to carry out a
State forestry best management practices program or a
watershed forestry project if the program or project,
as determined by the Secretary--
(A) is consistent with--
(i) State nonpoint source assessment
and management plan objectives
established under section 319 of the
Federal Water Pollution Control Act (33
U.S.C. 1329); and
(ii) the cost-share requirements of
this section; and
(B) is designed to address critical forest
stewardship, watershed protection, and
restoration needs of a State through--
(i) the use of trees and forests as
solutions to water quality problems in
urban and agricultural areas;
(ii) community-based planning,
involvement, and action through State,
local and nonprofit partnerships;
(iii) the application of and
dissemination of information on
forestry best management practices
relating to water quality;
(iv) watershed-scale forest
management activities and conservation
planning; and
(v) the restoration of wetland and
stream side forests and establishment of
riparian vegetative buffers.
(3) Allocation.--
(A) In general.--After taking into
consideration the criteria described in
subparagraph (B), the Secretary shall allocate
among States, for award by State foresters
under paragraph (4), the amounts made available
to carry out this subsection.
(B) Criteria.--The criteria referred to in
subparagraph (A) are--
(i) the number of acres of forest
land, and land that could be converted
to forest land, in each State;
(ii) the nonpoint source assessment
and management plans of each State, as
developed under section 319 of the
Federal Water Pollution Control Act (33
U.S.C. 1329);
(iii) the acres of wetland forests
that have been lost or degraded or
cases in which forests may play a role
in restoring wetland resources;
(iv) the number of non-Federal forest
landowners in each State; and
(v) the extent to which the
priorities of States are designed to
achieve a reasonable range of the
purposes of the program and, as a
result, contribute to the water-related
goals of the United States.
(4) Award of grants and assistance.--
(A) In general.--In implementing the program
under this subsection, the State forester, in
coordination with the State Coordinating
Committee established under section 19(b),
shall provide annual grants and cost-share
assistance to communities, nonprofit groups,
and landowners to carry out eligible programs
and projects described in paragraph (2).
(B) Application.--A community, nonprofit
group, or landowner that seeks to receive cost-
share assistance under this subsection shall
submit to the State forester an application, in
such form and containing such information as
the State forester may prescribe, for the
assistance.
(C) Prioritization.--In awarding cost-share
assistance under this subsection, the Secretary
shall give priority to eligible programs and
projects that are identified by the State
foresters and the State Stewardship Committees
as having a greater need for assistance.
(D) Award.--On approval by the Secretary of
an application under subparagraph (B), the
State forester shall award to the applicant,
from funds allocated to the State under
paragraph (3), such amount of cost-share
assistance as is requested in the application.
(5) Cost sharing.--
(A) Federal share.--The Federal share of the
cost of carrying out any eligible program or
project under this subsection shall not exceed
75 percent, of which not more than 50 percent
may be in the form of assistance provided under
this subsection.
(B) Non-federal share.--The non-Federal share
of the cost of carrying out any eligible
program or project under this subsection may be
provided in the form of cash, services, or in-
kind contributions.
(d) Watershed Forester.--A State may use a portion of the
funds made available to the State under subsection (e) to
establish and fill a position of `Watershed Forester' to lead
State-wide programs and coordinate watershed-level projects.
(e) Funding.--
(1) In general.--There are authorized to be
appropriated to carry out this section $20,000,000 for
each of fiscal years 2002 through 2006.
(2) Allocation.--Of the funds made available under
paragraph (1)--
(A) 75 percent shall be used to carry out
subsection (c); and
(B) 25 percent shall be used to carry out
provisions of this section other than
subsection (c).
* * * * * * *
(1) Findings.--Congress finds that--
(A) the United States is becoming
increasingly dependent on nonindustrial private
forest land to supply necessary market
commodities and nonmarket conservation values;
(B) there is a strong demand for expanded
assistance programs for owners of nonindustrial
private forest land because the majority of the
wood supply of the United States comes from
nonindustrial private forest land;
(C) soil, water, and air quality, fish and
wildlife habitat, aesthetic values, and
opportunities for outdoor recreation in the
United States would be maintained and improved
through good stewardship of nonindustrial
private forest land;
(D) the products and services resulting from
stewardship of nonindustrial private forest
land contribute to the economic, social, and
ecological health and diversity of rural
communities;
(E) catastrophic wildfires threaten human
lives, property, forests, and other resources;
(F) Federal and State cooperation in forest
fire prevention and control has proven
effective and valuable because properly managed
forest stands are less susceptible to
catastrophic fire, as demonstrated by the
catastrophic fire seasons of 1998 and 2000;
(G) owners of nonindustrial private forest
land face increased pressure to make that land
available for development and other uses,
resulting in forest land loss and fragmentation
that reduces the ability of private forest land
to provide a full range of societal benefits;
(H) complex, investments in the management of
long-rotation forest stands, including
sustainable hardwood management are often the
most difficult commitments for owners of
nonindustrial private forest land;
(I) the investment of a single Federal dollar
in State and private forestry programs is
estimated to leverage, on the average, $9 from
State, local, and private sources; and
(J) comprehensive, multiresource planning
assistance made available to each landowner
before the provision of technical assistance
would provide an opportunity to ensure that the
landowner is aware of the many projects and
activities eligible for cost-share assistance.
(2) Purposes.--The purposes of this section are--
(A) to strengthen the commitment of the
Secretary to sustainable forest management to
enhance the productivity of timber, fish and
wildlife habitat, soil and water quality,
wetland, recreational resources, and aesthetic
values of forest land; and
(B) to establish a coordinated and
cooperative Federal, State, and local
sustainable forestry program for the
establishment, management, maintenance,
enhancement, and restoration of forests on
nonindustrial private forest land.
(b) Initiative.--The Cooperative Forestry Assistance Act of
1978 is amended by inserting after section 6 (16 U.S.C. 2103b)
the following:
SEC. 6A. SUSTAINABLE FOREST MANAGEMENT PROGRAM.
(a) Definitions.--In this section:
(1) Committee.--The term ``Committee'' means a State
Forest Stewardship Coordinating Committee established
under section 19(b).
(2) Indian tribe.--The term ``Indian tribe'' has the
meaning given the term in section 4 of the Indian Self-
Determination and Education Assistance Act (25 U.S.C.
450b).
(3) Program.--The term ``program'' means the
sustainable forest management program established under
subsection (b)(1).
(4) Nonindustrial private forest land.--The term
``nonindustrial private forest land'' has the meaning
given the term ``nonindustrial private forest lands''
in section 5(c).
(5) Owner.--The term ``owner'' means an owner of
nonindustrial private forest land.
(6) State forester.--The term ``State forester''
means the director or other head of a State forestry
agency (or an equivalent State official).
(b) Establishment.--
(1) In general.--The Secretary shall establish a
sustainableforest management program to--
(A) provide financial assistance to State
foresters; and
(B) encourage the long-term sustainability of
nonindustrial private forest land in the United
States by assisting the owners of nonindustrial
private forest land, through State foresters,
in more actively managing the nonindustrial
private forest land and related resources of
those owners through the use of State, Federal,
and private sector resource management
expertise, financial assistance, and
educational programs.
(2) Coordination.--The Secretary, acting through
State foresters, shall implement the program--
(A) in coordination with the Committees; and
(B) in consultation with--
(i) other Federal, State, and local
natural resource management agencies;
(ii) institutions of higher
education; and
(iii) a broad range of private sector
interests.
(c) State Priority Plan.--
(1) In general.--Subject to paragraph (3), as a
condition of receipt of funding under the program, a
State Forester and the Committee of the State shall
jointly develop and submit to the Secretary a 5-year
plan that describes the funding priorities of the State
in meeting the goals of the program.
(2) Public participation.--The plan submitted to the
Secretary under paragraph (1) shall include
documentation of the efforts of the State to provide
for public participation in the development of the
plan.
(3) State priorities.--The Secretary shall ensure, to
the maximum extent practicable, that the need for
expanded technical assistance programs for owners is
met in the annual funding priorities of each State
described in paragraph (1).
(d) Purposes.--The Secretary shall allocate resources of
the Secretary among States in accordance with subsection (j) to
encourage, in accordance with the plan of each State described
in subsection (c)--
(1) the investment in practices to establish,
restore, protect, manage, maintain, and enhance the
health and productivity of the nonindustrial private
forest land in the United States;
(2) the occurrence of afforestation, reforestation,
improvement of poorly stocked stands, timber stand
improvement, practices necessary to improve seedling
growth and survival, and growth enhancement practices
as needed to enhance and sustain the long-term
productivity of timber and nontimber forest resources
to--
(A) meet projected public demand for forest
resources; and
(B) provide environmental benefits;
(3) the protection of riparian buffers and forest
wetland;
(4) the maintenance and enhancement of fish and
wildlife habitat;
(5) the enhancement of soil, air, and water quality;
(6) through the use of agroforestry practices, the
reduction of soil erosion and maintenance of soil
quality;
(7) the maintenance and enhancement of the forest
landbase;
(8) the reduction of the threat of catastrophic
wildfires; and
(9) the preservation of aesthetic quality and
opportunities for outdoor recreation.
(e) Eligibility.--
(1) Cost share assistance.--
(A) In general.--Except as provided in
paragraph (2), an owner shall be eligible to
receive cost-share assistance from a State
forester under the program if the owner--
(i) develops a management plan in
accordance with subsection (g) that--
(I) addresses site-specific
activities and practices; and
(II) is approved by the State
forester;
(ii) agrees to implement approved
activities in accordance with a
management plan for a period of not
less than 10 years, unless the State
forester approves a modification to the
management plan; and
(iii) except as provided in
subparagraph (B), owns not more than
1,000 acres of nonindustrial private
forest land.
(B) Exception for significant public
benefits.--The Secretary may approve the
provision of cost-share assistance to an owner
that owns more than 1,000 but less than 5,000
acres of nonindustrial private forest land if
the Secretary, in consultation with the State
forester, determines that significant public
benefits will accrue as a result of the
approval.
(2) Payment for plan development.--The Secretary,
acting through a State forester, may provide cost-share
assistance to an owner to develop a management plan.
(3) Limitations.--An owner shall receive no cost-
share assistance for management of nonindustrial
private forest land under this section if the owner
receives cost-share assistance for that land under--
(A) the forestry incentives program under
section 4;
(B) the stewardship incentives program under
section 6; or
(C) any conservation program administered by
the Secretary.
(4) Rate; schedule.--Subject to paragraph (5), the
Secretary, in consultation with the State forester,
shall determine the rate and timing of cost-share
payments.
(5) Amount.--
(A) Percentage of cost.--Subject to
subparagraph (B), a cost-share payment shall
not exceed the lesser of an amount equal to--
(i) 75 percent of the total cost of
implementing the project or activity;
or
(ii) such lesser percentage of the
total cost of implementing the project
or activity as is determined by the
appropriate State forester.
(B) Aggregate payment limit.--The Secretary
shall determine the maximum aggregate amount of
cost-share payments that an owner may receive
under this section.
(f) Management Plan.--An owner that seeks to participate in
the program shall--
(1) submit to the State forester a management plan
that--
(A) meets the requirements of this section;
and
(B)(i) is prepared by, or in consultation
with, a professional resource manager;
(ii) identifies and describes projects and
activities to be carried out by the owner to
protect soil, water, air, range, and aesthetic
quality, recreation, timber, water, wetland,
and fish and wildlife resources on the land in
a manner that is compatible with the objectives
of the owner;
(iii) addresses any criteria established by
the applicable State and the applicable
Committee; and
(iv)(I) at a minimum, applies to the portion
of the land on which any project or activity
funded under the program will be carried out;
or
(II) in a case in which a project or activity
described in subclause (I) may affect acreage
outside the portion of the land on which the
project or activity is carried out, applies to
all land of the owner that is in forest cover
and that may potentially be affected by the
project or activity; and
(2) agree that all projects and activities conducted
on the land shall be consistent with the management
plan.
(g) Approved Activities.--
(1) In general.--The Secretary, in consultation with
the State forester and the appropriate Committee, shall
develop for each State a list of approved forest
activities and practices eligible for cost-share
assistance that meets the purposes of the program
described in subsection (d).
(2) Types of activities.--Approved activities and
practices under paragraph (1) may consist of activities
and practices for--
(A) the establishment, management,
maintenance, and restoration of forests for
shelterbelts, windbreaks, aesthetic quality,
and other conservation purposes;
(B) the sustainable growth and management of
forests for timber production;
(C) the restoration, use, and enhancement of
forest wetland and riparian areas;
(D) the protection of water quality and
watersheds through--
(i) the planting of trees in riparian
areas; and
(ii) the enhanced management and
maintenance of native vegetation on
land vital to water quality;
(E) the preservation, restoration, or
development of habitat for plants, fish, and
wildlife;
(F)(i) the control, detection, monitoring,
and prevention of the spread of invasive
species and pests on nonindustrial private
forest land; and
(ii) the restoration of nonindustrial
private forest land affected by
invasive species and pests;
(G) the conduct of other management
activities, such as the reduction of hazardous
fuel use, that reduce the risks to forests
posed by, and that restore, recover, and
mitigate the damage to forests caused by, fire
or any other catastrophic event, as determined
by the Secretary;
(H) the development of management plans;
(I) the acquisition by the State of permanent
easements to maintain forest cover and protect
important forest values; and
(J) the conduct of other activities approved
by the Secretary, in consultation with the
State forester and the appropriate Committees.
(h) Failure To Comply.--
(1) In general.--The Secretary shall establish a
procedure to recover cost-share payments made under
this section in any case in which the recipient of the
payment fails--
(A) to implement a project or activity in
accordance with the management plan; or
(B) comply with any requirement of this
section.
(2) Additional authority.--The authority under
paragraph (1) shall be in addition to, and not in lieu
of, any other authority available to the Secretary.
(i) Reports.--
(1) Interim report.--Not later than 2\1/2\ years
after the date on which funds are made available to
implement a State priority plan under subsection (c),
the State implementing the plan shall submit to the
Secretary an interim report describing the status of
projects and activities funded under the plan as of
that date.
(2) Final report.--Not later than 5 years after the
date on which funds are made available to implement a
State priority plan under subsection (d), the State
implementing the plan shall submit to the Secretary a
final report describing the status of all projects and
activities funded under the plan as of that date.
(j) Distribution.--
(1) In general.--The Secretary, acting through State
foresters, shall distribute funds available for cost
sharing under the initiative based on a nationwide
funding formula developed under paragraph (2).
(2) Formula.--In developing the formula referred to
in paragraph (1), the Secretary shall--
(A) assess public benefits that would result
from the distribution; and
(B) consider--
(i) the total acreage of
nonindustrial private forest land in
each State;
(ii) the potential productivity of
that land, as determined by the
Secretary;
(iii) the number of owners eligible
for cost sharing in each State;
(iv) the opportunities to enhance
nontimber resources on that land,
including--
(I) the protection of
riparian buffers and forest
wetland;
(II) the preservation of fish
and wildlife habitat;
(III) the enhancement of
soil, air, and water quality;
and
(IV) the preservation of
aesthetic quality and
opportunities for outdoor
recreation;
(v) the anticipated demand for timber
and nontimber resources in each State;
(vi) the need to improve forest
health to minimize the damaging effects
of catastrophic fire, insects, disease,
or weather;
(vii) the need and demand for
agroforestry practices in each State;
(viii) the need to maintain and
enhance the forest landbase; and
(ix) the need for afforestation,
reforestation, and timber stand
improvement.
(k) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this section, and on October 1,
2002, and each October 1 thereafter through October 1,
2005, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary of Agriculture to carry out
this section $48,000,000, to remain available until
expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
SEC. 11. FOREST FIRE RESEARCH CENTERS.
(a) In General.--Subject to the availability of
appropriations, the Secretary of Agriculture, acting through
the Chief of the Forest Service (referred to in this section as
the ``Secretary'') shall establish at least 2 forest fire
research centers at institutions of higher education (which may
include research centers in existence on the date of enactment
of this section) that--
(1) have expertise in natural resource development;
and
(2) are located in close proximity to other Federal
natural resource, forest management, and land
management agencies.
(b) Locations.--Of the forest fire research centers
established under subsection (a)--
(1) at least 1 center shall be located in Arizona,
California, New Mexico, Oregon, or Washington; and
(2) at least 1 center shall be located in Colorado,
Idaho, Montana, Nevada, or Wyoming.
(c) Duties.--At each of the forest fire research centers
established under subsection (a), the Secretary shall provide
for--
(1) the conduct of integrative, interdisciplinary
research into the ecological, socioeconomic, and
environmental impact of fire control and the use of
management of ecosystems and landscapes to facilitate
fire control; and
(2) the development of mechanisms to rapidly transfer
new fire control and management technologies to fire
and land managers.
(d) Advisory Committee.--
(1) In general.--The Secretary, in consultation with
the Secretary of Interior, shall establish a committee
composed of fire and land managers and fire researchers
to determine the areas of emphasis and establish
priorities for research projects conducted at forest
fire research centers established under subsection (a).
(2) Administration.--The Federal Advisory Committee
Act (5 U.S.C. App.) and section 102 of the Agricultural
Research, Extension, and Education Reform Act of 1998
(7 U.S.C. 7612) shall not apply to the committee
established under paragraph (1).
(e) Authorization of Appropriations.--There are authorized
to be appropriated such sums as are necessary to carry out this
section.
SEC. 6B. WILDFIRE PREVENTION AND HAZARDOUS FUEL PURCHASE PROGRAM.
(a) Definitions.--In this section:
(1) Biomass-to-energy facility.--The term ``biomass-
to-energy facility'' means a facility that uses forest
biomass or other biomass as a raw material to produce
electric energy, useful heat, or a transportation fuel.
(2) Eligible community.--The term ``eligible
community'' means--
(A) any town, township, municipality, or
other similar unit of local government (as
determined by the Secretary), or any area
represented by a nonprofit corporation or
institution organized under Federal or State
law to promote broad-based economic
development, that--
(i) has a population of not more than
10,000 individuals;
(ii) is located within a county in
which at least 15 percent of the total
primary and secondary labor and
proprietor income is derived from
forestry, wood products, and forest-
related industries, such as recreation,
forage production, and tourism; and
(iii) is located adjacent to public
or private forest land, the condition
of which land the Secretary determines
poses a substantial present or
potential hazard to the safety of--
(I) a forest ecosystem;
(II) wildlife; or
(III) in the case of a
wildfire, human, community, or
firefighter safety, in a year
in which drought conditions are
present; and
(B) any county that is not contained within a
metropolitan statistical area that meets the
conditions described in clauses (ii) and (iii)
of subparagraph (A).
(3) Forest biomass.--The term ``forest biomass''
means fuel and biomass accumulation from precommercial
thinnings, slash, and brush on public or private forest
land.
(4) Hazardous fuel.--The term ``hazardous fuel''
means any excessive accumulation of forest biomass on
public or private forest land (especially land in an
urban-wildland interface area or in an area that is
located near an eligible community and designated as
condition class 2 or 3 under the report of the Forest
Service entitled ``Protecting People and Sustainable
Resources in Fire-Adapted Ecosystems'', dated October
13, 2000 that the Secretary determines poses a
substantial present or potential hazard--
(A) to the safety of a forest ecosystem;
(B) to the safety of wildlife; or
(C) in the case of wildfire in a year in
which drought conditions are present, to human,
community, or firefighter safety.
(5) Indian tribe.--The term ``Indian tribe'' has the
meaning given the term in section 4 of the Indian Self-
Determination and Education Assistance Act (25 U.S.C.
450b).
(6) Secretary.--The term ``Secretary'' means--
(A) the Secretary of Agriculture (or a
designee), with respect to National Forest
System land and private land in the United
States; and
(B) the Secretary of the Interior (or a
designee) with respect to Federal land under
the jurisdiction of the Secretary of the
Interior or an Indian tribe.
(b) Hazardous Fuel Grant Program.--
(1) Grants.--
(A) In general.--Subject to the availability
of appropriations, the Secretary may make
grants to persons that operate biomass-to-
energy facilities to offset the costs incurred
by those persons in purchasing hazardous fuels
derived from public and private forest land
adjacent to eligible communities.
(B) Selection criteria.--The Secretary shall
select recipients for grants under subparagraph
(A) based on--
(i) planned purchases by the
recipients of hazardous fuels, as
demonstrated by the recipient through
the submission to the Secretary of such
assurances as the Secretary may
require; and
(ii) the level of anticipated
benefits of those purchases in reducing
the risk of wildfires.
(2) Grant amounts.--
(A) In general.--A grant under this
subsection shall--
(i) be based on--
(I) the distance required to
transport hazardous fuels to a
biomass-to-energy facility; and
(II) the cost of removal of
hazardous fuels; and
(ii) be in an amount that is at least
equal to the product obtained by
multiplying--
(I) the number of tons of
hazardous fuels delivered to a
grant recipient; by
(II) an amount that is at
least $5 but not more than $10
per ton of hazardous fuels, as
determined by the Secretary
taking into consideration the
factors described in clause
(i).
(B) Limitation on individual grants.--
(i) In general.--Except as provided
in clause (ii), a grant under
subparagraph (A) shall not exceed
$1,500,000 for any biomass-to-energy
facility for any fiscal year.
(ii) Small biomass-to-energy
facilities.--A biomass-to-energy
facility that has an annual production
of 5 megawatts or less shall not be
subject to the limitation under clause
(i).
(3) Monitoring of grant recipient activities.--
(A) In general.--As a condition of receipt of
a grant under this subsection, a grant
recipient shall keep such records as the
Secretary may require, including records that--
(i) completely and accurately
disclose the use of grant funds; and
(ii) describe all transactions
involved in the purchase of hazardous
fuels.
(B) Access.--On notice by the Secretary, the
operator of a biomass-to-energy facility that
purchases and uses hazardous fuels with funds
from a grant under this subsection shall
provide the Secretary with--
(i) reasonable access to the biomass-
to-energy facility; and
(ii) an opportunity to examine the
inventory and records of the biomass-
to-energy facility.
(4) Monitoring of effect of treatments.--The
Secretary shall monitor Federal land from which
hazardous fuels are removed and sold to a biomass-to-
energy facility under this subsection to determine and
document the reduction in fire hazards on that land.
(5) Authorization of appropriations.--There is
authorized to be appropriated to carry out this
subsection $50,000,000 for each of fiscal years 2002
through 2006.
(c) Long-Term Forest Stewardship Contracts for Hazardous
Fuels Removal.--
(1) Annual assessment of treatment acreage.--
(A) In general.--Subject to the availability
of appropriations, not later than March 1 of
each of fiscal years 2002 through 2006, the
Secretary of Agriculture and the Secretary of
Energy shall jointly submit to Congress an
assessment of the number of acres of Federal
forest land recommended to be treated during
the subsequent fiscal year using stewardship
end result contracts authorized by paragraph
(3).
(B) Components.--The assessment shall--
(i) be based on the treatment
schedules contained in the report
entitled ``Protecting People and
Sustaining Resources in Fire-Adapted
Ecosystems'', dated October 13, 2000
and incorporated into the National Fire
Plan (as identified by the Secretary);
(ii) identify the acreage by
condition class, type of treatment, and
treatment year to achieve the
restoration goals outlined in the
report within 10-, 15-, and 20-year
time periods;
(iii) give priority to condition
class 3 areas (as described in
subsection (a)(4)(A)), including
modifications in the restoration goals
based on the effects of--
(I) fire;
(II) hazardous fuel
treatments under the National
Fire Plan (as identified by the
Secretary); or
(III) updates in data;
(iv) provide information relating to
the type of material and estimated
quantities and range of sizes of
material that shall be included in the
treatments;
(v) describe the management area
prescriptions in the applicable land
and resource management plan for the
land on which the treatment is
recommended; and
(vi) give priority to areas described
in subsection (a)(4)(A).
(2) Funding recommendation.--The Secretary shall
include in the annual assessment under paragraph (1) a
request for funds sufficient to implement the
recommendations contained in the assessment using
stewardship end result contracts described in paragraph
(3) in any case in which the Secretary determines that
the objectives of the National Fire Plan (as identified
by the Secretary) would best be accomplished through
forest stewardship end result contracting.
(3) Stewardship end result contracting.--
(A) In general.--Subject to the availability
of appropriations, the Secretary may enter into
stewardship end result contracts to implement
the National Fire Plan (as identified by the
Secretary) on National Forest System land based
on the treatment schedules provided in the
annual assessments conducted under paragraph
(1)(B)(i).
(B) Period of contracts.--The contracting
goals and authorities described in subsections
(b) through (g) of section 347 of the
Department of the Interior and Related Agencies
Appropriations Act, 1999 (commonly known as the
``Stewardship End Result Contracting
Demonstration Project'') (16 U.S.C. 2104 note;
Public Law 105-277), shall apply to contracts
entered into under this paragraph, except that
the period of each such contract shall not
exceed 10 years.
(C) Status report.--Beginning with the
assessment required under paragraph (1) for
fiscal year 2003, the Secretary shall include
in the annual assessment under paragraph (1) a
status report of the stewardship end result
contracts entered into under this paragraph.
(4) Authorization of appropriations.--There are
authorized to be appropriated to carry out this
subsection such sums as are necessary for each of
fiscal years 2002 through 2006.
(d) Termination of Authority.--The authority provided under
this section shall terminate on September 30, 2006.
* * * * * * *
SEC. 10A. ENHANCED COMMUNITY FIRE PROTECTION.
(a) Cooperative Management Relating to Wildfire Threats.--
Notwithstanding section 7 of the Federal Fire Prevention and
Control Act of 1974 (15 U.S.C. 2206), the Secretary may
cooperate with State foresters and equivalent State officials
to--
(1) assist in the prevention, control, suppression,
and prescribed use of fires (including through the
provision of financial, technical, and related
assistance);
(2) protect communities from wildfire threats;
(3) enhance the growth and maintenance of trees and
forests in a manner that promotes overall forest
health; and
(4) ensure the continued production of all forest
resources, including timber, outdoor recreation
opportunities, wildlife habitat, and clean water,
through conservation of forest cover on watersheds,
shelterbelts, and windbreaks.
(b) Community and Private Land Fire Assistance Program.--
(1) In general.--The Secretary shall establish a
program to be known as the ``community and private land
fire assistance program'' (referred to in this section
as the ``Program'')--
(A) to focus the Federal role in promoting
optimal firefighting efficiency at the Federal,
State, and local levels;
(B) to provide increased assistance to
Federal projects that establish landscape level
protection from wildfires;
(C) to expand outreach and education programs
concerning fire prevention to homeowners and
communities; and
(D) to establish defensible space against
wildfires around the homes and property of
private landowners.
(2) Administration and implementation.--The Program
shall be administered by the Secretary and, with
respect to non-Federal land described in paragraph (3),
carried out through the State forester or equivalent
State official.
(3) Components.--The Secretary may carry out under
the Program, on National Forest System land and non-
Federal land determined by the Secretary in
consultation with State foresters and Committees--
(A) fuel hazard mitigation and prevention;
(B) invasive species management;
(C) multiresource wildfire and community
protection planning;
(D) community and landowner education
enterprises, including the program known as
``FIREWISE'';
(E) market development and expansion;
(F) improved use of wood products; and (G)
restoration projects.
(4) Priority.--In entering into contracts to carry
out projects under the Program, the Secretary shall
give priority to contracts with local persons or
entities.
(c) Authority.--The authority provided under this section
shall be in adition to any authority provided under section 10.
(d) Authorization of Appropriations.--There are authorized
to be appropriated to the Secretary to carry out this section
$35,000,000 for each of fiscal years 2002 through 2006.
* * * * * * *
Sec. 13. (a) In implementing this Act, the Secretary shall,
to the maximum extent practicable--
(1) work through, cooperate with, and assist State
foresters or
* * * * * * *
(e) The Secretary may prescribe rules and regulations, as
the Secretary deems appropriate, to implement the provisions of
this Act.
[(f) The Secretary is authorized to make grants,
agreements, contracts, and other arrangements the Secretary
deems necessary to implement this Act.]
(f) Grants, Contracts, and Other Agreements.--
(1) In general.--In accordance with paragraph (2),
the Secretary may make such grants and enter into such
contracts, agreements, or other arrangements as the
Secretary determines are necessary to carry out this
Act.
(2) Assistance.--Notwithstanding any other provision
of this Act, the Secretary, with the concurrence of the
applicable State forester or equivalent State official,
may provide assistance under this Act directly to any
public or private entity, organization, or individual--
(A) through a grant; or
(B) by entering into a contract or
cooperative agreement.
(g) This Act shall be construed as supplementing all other
laws relating to the Department of Agriculture and shall not be
construed as limiting or repealing any existing law or
authority of the Secretary, except as specifically cited in
section 16 of this Act.
* * * * * * *
(B) Composition.--The State Coordinating
Committee shall be chaired and administered by
the State forester, or equivalent State
official, or the designee thereof, and shall be
composed, to the extent practicable, of--
(i) representatives from the United
States Fish and Wildlife Service,
Forest Service, Soil Conservation
Service, Agricultural Stabilization and
Conservation Service, and Extension
Service;
* * * * * * *
(2) Duties.--A State Coordinating Committee shall--
(A) consult with other Department of
Agriculture and State committees that address
State and private forestry issues;
(B) make recommendations to the Secretary
concerning the assignment of priorities and the
coordination of responsibilities for the
implementation of this Act by the various
Federal and State forest management agencies
that take into consideration the mandates of
each such agency;
(C) make recommendations to the State
forester or equivalent State official
concerning the development of a Forest
Stewardship Plan under paragraph (3); [and]
(D) make recommendations to the Secretary
concerning those forest lands that should be
given priority for inclusion in the Forest
Legacy Program established pursuant to section
7--[i] ; and
(E) submit to the Secretary, the Committee on
Agriculture of the House of Representatives and
the Committee on Agriculture, Nutrition, and
Forestry of the Senate, an annual report that
describes--
(i) the list of members on the
Committee described in paragraph
(1)(B); and
(ii) for those members that may be
included on the Committee, but are not
included because a determination that
it is not practicable to include the
members has been made, an explanation
of the reasons for that determination.
(3) Forest stewardship plan.--The State forester or
equivalent State official of each State, in
consultation with the State Coordinating Committee of
such State, shall develop a Forest Stewardship Plan
that shall--
* * * * * * *
RENEWABLE RESOURCES EXTENSION ACT OF 1978
* * * * * * *
SEC. 5A. EXPANDED PROGRAMS.
* * * * * * *
SEC. 5B. SUSTAINABLE FORESTRY OUTREACH INITIATIVE.
The Secretary shall establish a program, to be known as the
``Sustainable Forestry Outreach Initiative'', to educate
landowners concerning--
(1) the value and benefits of practicing sustainable
forestry;
(2) the importance of professional forestry advice in
achieving sustainable forestry objectives; and
(3) the variety of public and private sector
resources available to assist the landowners in
planning for and practicing sustainable forestry.
Sec. 6. [There are hereby authorized to be appropriated to
implement this Act $15,000,000 for each of fiscal years 1987
through 2002.] There is authorized to be appropriated to carry
out this Act $30,000,000 for each of fiscal years 2002 through
2006. Generally, States shall be eligible for funds
appropriated under this Act according to the respective
capabilities of their private forests and rangelands for
yielding renewable resources and relative needs for such
resources identified in the periodic Renewable Resource
Assessment provided for in section 3 of the Forest and
Rangeland Renewable Resources Planning Act of 1974 and the
periodic appraisal of land and water resources provided for in
section 5 of the Soil and Water Resources Conservation Act of
1977.
* * * * * * *
Sec. 8. The provisions of this Act shall be effective for
the period beginning October 1, 1978, and ending September 30,
[2000] 2006.
* * * * * * *
SEC. 6704. OFFICE OF INTERNATIONAL FORESTRY.
(a) Establishment.--The Secretary, acting through the Chief
of the Forest Service, shall establish an Office of
International Forestry within the Forest Service within six
months after November 28, 1990.
(b) Deputy Chief Designation.--The Chief shall appoint a
Deputy Chief for International Forestry.
(c) Duties.--The Deputy Chief shall--
(1) be responsible for the international forestry
activities of the Forest Service;
(2) coordinate the activities of the Forest Service
in implementing the provisions of this chapter; and
(3) serve as Forest Service liaison to the director
for the program established pursuant to section 6701 of
this title.
(d) Authorization of Appropriations.--There are authorized
to be appropriated for each of fiscal years 1996 through [2002]
2006 such sums as are necessary to carry out this section.
TITLE 9
BIOMASS RESEARCH AND DEVELOPMENT ACT OF 2000
* * * * * * *
SEC. 307. BIOMASS RESEARCH AND DEVELOPMENT INITIATIVE.
(a) In General.--The Secretary of Agriculture and the
Secretary of Energy, acting through their respective points of
contact and in consultation with the Board, shall establish and
carry out a Biomass Research and Development Initiative under
which competitively awarded grants, contracts, and financial
assistance are provided to, or entered into with, eligible
entities to carry out research on biobased industrial products.
* * * * * * *
(e) Technology and Information Transfer to Agricultural
Users.--
(1) In general.--The Administrator of the Cooperative
State Research, Education, and Extension Service and
the Chief of the Natural Resources Conservation Service
shall ensure that applicable research results and
technologies from the Initiative are adapted, made
available, and disseminated through their respective
services, as appropriate.
* * * * * * *
(2) Report.--Not later than 5 years after the date of
the enactment of this Act, the Administrator of the
Cooperative State Research, Education, and Extension
Service and the Chief of the Natural Resources
Conservation Service shall submit to the committees of
Congress with jurisdiction over the Initiative a report
on the activities conducted by the services under this
subsection.
[(f) Authorization of Appropriations.--In addition to funds
appropriated for biomass research and development under the
general authority of the Secretary of Energy to conduct
research and development programs (which may also be used to
carry out this title), there are authorized to be appropriated
to the Department of Agriculture to carry out this title
$49,000,000 for each of fiscal years 2000 through 2005.]
* * * * * * *
SEC. 310. FUNDING.
(a) In General.--Not later than 30 days after the date of
enactment of this section, and on October 1, 2002, and each
October 1 thereafter through October 1, 2005, out of any funds
in the Treasury not otherwise appropriated, the Secretary of
the Treasury shall transfer to the Secretary to carry out this
section $15,000,000, to remain available until expended.
(b) Receipt and Acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to carry out
this section the funds transferred under subsection (a),
without further appropriation.
SEC. [310.] 311. TERMINATION OF AUTHORITY.
The authority provided under this title shall terminate on
[December 31, 2005] September 30, 2006.
* * * * * * *
CONSOLIDATED FARM AND RURAL DEVELOPMENT ACT
* * * * * * *
SEC. 382N. TERMINATION OF AUTHORITY.
This subtitle and the authority provided under this
subtitle expire on October 1, 2002.
Subtitle L--Clean Energy
SEC. 388A. DEFINITIONS.
In this subtitle:
(1) Biomass.--
(A) In general.--The term ``biomass'' means
any organic material that is available on a
renewable or recurring basis.
(B) Inclusions.--The term ``biomass''
includes--
(i) dedicated energy crops;
(ii) trees grown for energy
production;
(iii) wood waste and wood residues;
(iv) plants (including aquatic
plants, grasses, and agricultural
crops);
(v) residues;
(vi) fibers; and
(vii) animal wastes and other waste
materials and
(viii) fats and oils.
(C) Exclusions.--The term ``biomass'' does
not include--
(i) old-growth timber (as determined
by the Secretary);
(ii) paper that is commonly recycled;
or
(iii) unsegregated garbage.
(2) Renewable energy.--The term ``renewable energy''
means energy derived from a wind, solar, biomass,
geothermal, or hydrogen source.
(3) Rural small business.--The term ``rural small
business'' has the meaning that the Secretary shall
prescribe by regulation.
CHAPTER 1--BIOBASED PRODUCT DEVELOPMENT
SEC. 388B. BIOBASED PRODUCT PURCHASING REQUIREMENT.
(a) Definitions.--In this section:
(1) Administrator.--The term ``Administrator'' means
the Administrator of the Environmental Protection
Agency.
(2) Biobased product.--The term ``biobased product''
means a commercial or industrial product, as determined
by the Secretary (other than food or feed), that uses
biological products or renewable domestic agricultural
materials (including plant, animal, and marine
materials) or forestry materials.
(3) Environmentally preferable.--The term
``environmentally preferable'', with respect to a
biobased product, refers to a biobased product that
has a lesser or reduced effect on human health and
the environment when compared with competing
nonbiobased products that serve the same purpose.
(b) Biobased Product Purchasing.--
(1) Mandatory purchasing requirement for listed
biobased products.--
(A) In general.--Except as provided in
subparagraph (B), not later than 180 days after
the date of enactment of this subtitle, the
head of each Federal agency shall ensure that,
in purchasing any product, the Federal agency
purchases a biobased product, rather than a
comparable nonbiobased product, if the biobased
product is listed on the list of biobased
products published under subsection (c)(1).
(B) Biobased product not reasonably
comparable.--A Federal agency shall not be
required to purchase a biobased product under
subparagraph (A) if the purchasing employee
submits to the Secretary and the Administrator
of the Office of Federal Procurement Policy a
written determination that the biobased product
is not reasonably comparable to nonbiobased
products in price, performance, or
availability.
(C) Conflicting requirements.--The Secretary
and the Administrator shall jointly promulgate
regulations with which Federal agencies shall
comply in cases of a conflict between the
biobased product purchasing requirement under
subparagraph (A) and a purchasing requirement
under any other provision of law.
(2) Purchasing of nonlisted biobased products.--The
head of each Federal agency is encouraged to purchase,
to the maximum extent practicable, available biobased
products that are not listed on the list of biobased
products published under subsection (c)(1) when the
Federal agency is not required to purchase a biobased
product that is on the list.
(c) Administrative Action.--
(1) List of biobased products.--
(A) In general.--Not later than 180 days
after the date of enactment of this subtitle,
and annually thereafter, the Secretary, in
consultation with the Administrator and the
Director of the National Institute of Standards
and Technology, shall publish a list of
biobased products.
(B) Environmentally preferable biobased
products.--The Secretary shall not include on
the list under paragraph (1) biobased products
that are not environmentally preferable, as
determined by the Secretary.
(C) Grants.--The Secretary may award grants
to, or enter into contracts or cooperative
agreements with, eligible persons, businesses,
or institutions (as determined by the
Secretary) to assist in collecting data
concerning the evaluation of and lifecycle
analyses of biobased products for use in making
the determinations necessary to carry out
paragraph (1).
(2) Guidance.--Not later than 240 days after the date
of enactment of this subtitle, the Office of Federal
Procurement Policy and Federal Acquisition Regulation
Council shall make the Federal Acquisition Regulation
consistent with subsection (b).
(d) Education and Outreach Program.--The Secretary, in
cooperation with the Defense Acquisition University and the
Federal Acquisition Institute, shall conduct education programs
for all Federal procurement officers regarding biobased
products and the requirements of subsection (b).
(e) Labeling.--
(1) In general.--The Secretary shall develop a
program, similar to the Energy Star program of the
Department of Energy and the Environmental Protection
Agency, under which the Secretary authorizes producers
of environmentally preferable biobased products to use
a label that identifies the products as environmentally
preferable biobased products.
(2) Environmentally preferable biobased products.--
The Secretary shall monitor and take appropriate action
regarding the use of labels under paragraph (1) to
ensure that the biobased products using the labels do
not include biobased products that are not
environmentally preferable, as determined by the
Secretary.
(3) Contracting.--In carrying out paragraph (1), the
Secretary may contract with appropriate entities with
expertise in product labeling and standard setting.
(f) Goal.--It shall be the goal of each Federal agency in
each year to purchase biobased products of an aggregate value
that is not less than 5 percent of the aggregate value of all
products purchased by the Federal agency during the preceding
fiscal year.
(g) Reports.--As soon as practicable after the end of each
fiscal year, the Secretary and the Office of Federal
Procurement Policy shall jointly submit to Congress an annual
report that, for the fiscal year, describes the extent of--
(1) compliance by each Federal agency with subsection
(b); and
(2) the success of each Federal agency in achieving
the goal established under subsection (f).
(h) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this subtitle, and on October 1,
2002, and each October 1 thereafter through October 1,
2005, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary to carry out this section
$2,000,000, to remain available until expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
SEC. 388C. BIOREFINERY DEVELOPMENT GRANTS.
(a) Purpose.--The purpose of this section is to assist in
the development of new and emerging technologies for the
conversion of biomass into petroleum substitutes, so as to--
(1) develop transportation and other fuels and
chemicals from renewable sources;
(2) reduce the dependence of the United States on
imported oil;
(3) reduce greenhouse gas emissions;
(4) diversify markets for raw agricultural and
forestry products; and
(5) create jobs and enhance the economic development
of the rural economy.
(b) Definitions.--In this section:
(1) Advisory committee.--The term ``Advisory
Committee'' means the Biomass Research and Development
Technical Advisory Committee established by section 306
of the Biomass Research and Development Act of 2000 (7
U.S.C. 7624 note; Public Law 106-224).
(2) Biorefinery.--The term ``biorefinery'' means
equipment and processes that--
(A) convert biomass into bioenergy fuels and
chemicals; and
(B) may produce electricity as a byproduct.
(3) Board.--The term ``Board'' means the Biomass
Research and Development Board established by section
305 of the Biomass Research and Development Act of 2000
(7 U.S.C. 7624 note; Public Law 106-224).
(4) Indian tribe.--The term ``Indian tribe'' has the
meaning given the term in section 4 of the Indian Self-
Determination and Education Assistance Act (25 U.S.C.
450b).
(c) Grants.--The Secretary shall award grants to eligible
entities to assist in paying the cost of development and
construction of biorefineries to carry out projects to
demonstrate the commercial viability of 1 or more processes for
converting biomass to fuels or chemicals.
(d) Eligible Entities.--A corporation, farm cooperative,
association of farmers, national laboratory, university, State
energy agency or office, Indian tribe, or consortium comprised
of any of those entities shall be eligible to receive a grant
under subsection (c).
(e) Competitive Basis for Awards.--
(1) In general.--The Secretary shall award grants
under subsection (c) on a competitive basis in
consultation with the Board and Advisory Committee.
(2) Selection criteria.--
(A) In general.--The Secretary shall select
projects to receive grants under subsection (c)
based on--
(i) the likelihood that the projects
will demonstrate the commercial
viability of a process for converting
biomass to fuels or chemicals; and
(ii) the likelihood that the projects
will produce electricity.
(B) Factors.--The factors to be considered
under subparagraph (A) shall include--
(i) the potential market for the
product or products;
(ii) the quantity of petroleum the
product will displace;
(iii) the level of financial
participation by the applicants;
(iv) the availability of adequate
funding from other sources;
(v) the beneficial impact on resource
conservation and the environment;
(vi) the participation of producer
associations and cooperatives;
(vii) the timeframe in which the
project will be operational;
(viii) the potential for rural
economic development; and
(ix) the participation of multiple
eligible entities.
(f) Cost Sharing.--
(1) In general.--Except as provided in paragraph (2),
the amount of a grant for a project awarded under
subsection (c) shall not exceed 30 percent of the cost
of the project.
(2) Increased grant amount.--The Secretary may
increase the amount of a grant for a project under
subsection (c) to not more than 50 percent in the case
of a project that the Secretary finds particularly
meritorious.
(3) Form of grantee share.--
(A) In general.--The grantee share of the
cost of a project may be made in the form of
cash or the provision of services, material, or
other in-kind contributions.
(B) Limitation.--The amount of the grantee
share of the cost of a project that is made in
the form of the provision of services,
material, or other in-kind contributions shall
not exceed 25 percent of the amount of the
grantee share determined under paragraph (1).
(g) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this subtitle, and on October 1,
2002, and each October 1 thereafter through October 1,
2005, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary to carry out this section
$15,000,000, to remain available until expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
SEC. 388D. BIODIESEL FUEL EDUCATION PROGRAM.
(a) Findings.--Congress finds that--
(1) biodiesel fuel use can help reduce greenhouse gas
emissions and public health risks associated with air
pollution;
(2) biodiesel fuel use enhances energy security by
reducing petroleum consumption;
(3) biodiesel fuel is nearing the transition from the
research and development phase to commercialization;
(4) biodiesel fuel is still relatively unknown to the
public and even to diesel fuel users; and
(5) education of, and provision of technical support
to, current and future biodiesel fuel users will be
critical to the widespread use of biodiesel fuel.
(b) Establishment.--The Secretary shall, under such terms
and conditions as are appropriate, offer 1 or more competitive
grants to eligible entities to educate Federal, State,
regional, and local government entities and private entities
that operate vehicle fleets, other interested entities (as
determined by the Secretary), and the public about the benefits
of biodiesel fuel use.
(c) Eligible Entities.--To receive a grant under subsection
(b), an entity--
(1) shall be a nonprofit organization; and
(2) shall have demonstrated expertise in biodiesel
fuel production, use, and distribution.
(d) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $5,000,000 for
each of fiscal years 2002 through 2006, to remain available
until expended.
CHAPTER 2--RENEWABLE ENERGY DEVELOPMENT AND ENERGY EFFICIENCY
SEC. 388E. RENEWABLE ENERGY DEVELOPMENT LOAN AND GRANT PROGRAM.
(a) In General.--The Secretary, acting through the Rural
Business Cooperative Service, in addition to exercising
authority to make loans and loan guarantees under other law,
shall establish a program under which the Secretary shall make
loans and loan guarantees and competitively award grants to
assist farmers and ranchers in projects to establish new, or
expand existing, farmer or rancher cooperatives, or other rural
business ventures (as determined by the Secretary), to--
(1) enable farmers and ranchers to become owners of
sources of renewable electric energy and marketers of
electric energy produced from renewable sources;
(2) provide new income streams for farmers and
ranchers;
(3) increase the quantity of electricity available
from renewable energy sources; and
(4) provide environmental and public health benefits
to rural communities and the United States as a whole.
(b) Ownership Requirement.--At least 51 percent of the
interest in a rural business venture assisted with a grant
under subsection (a) shall be owned by farmers or ranchers.
(c) Maximum Amount of Loans and Grants.--
(1) Loans.--The amount of a loan made or guaranteed
for a project under subsection (a) shall not exceed
$10,000,000.
(2) Grants.--The amount of a grant made for a project
under subsection (a) shall not exceed $200,000 for a
fiscal year.
(d) Cost Sharing.--
(1) In general.--The total amount of loans made or
guaranteed or grants awarded under subsection (a) for a
project shall not exceed 50 percent of the cost of the
activity funded by the loan or grant.
(2) Form of grantee share.--
(A) In general.--The grantee share of the
cost of the activity may be made in the form of
cash or the provision of services, material, or
other in-kind contributions.
(B) Limitation.--The amount of the grantee
share of the cost of a project that is made in
the form of the provision of services,
material, or other in-kind contributions shall
not exceed 25 percent of the amount of the non-
Federal share, as determined under paragraph
(1).
(e) Interest Rate.--A loan made or guaranteed under
subsection (a) shall bear an interest rate that does not to
exceed 4 percent.
(f) Use of Funds.--
(1) Permitted uses.--
(A) Grants.--A recipient of a grant awarded
under subsection (a) may use the grant funds to
develop a business plan or perform a
feasibility study to establish a viable
marketing opportunity for renewable electric
energy generation and sale.
(B) Loans.--A recipient of a loan or loan
guarantee under subsection (a) may use the loan
funds to provide capital for start-up costs
associated with the rural business venture or
the promotion of the aggregation of renewable
electric energy sources.
(2) Prohibited uses.--A recipient of a loan, loan
guarantee, or grant under subsection (a) shall not use
the loan or grant funds for planning, repair,
rehabilitation, acquisition, or construction of a
building or other facility.
(g) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this subtitle, and on October 1,
2002, and each October 1 thereafter through October 1,
2005, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary to carry out this section
$16,000,000, to remain available until expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
(3) Loan and interest subsidies.--In the case of a
loan or loan guarantee under subsection (a), the
Secretary shall use funds under paragraph (1) to pay
the cost of loan and interest subsidies necessary to
carry out this section.
SEC. 388F. ENERGY AUDIT AND RENEWABLE ENERGY DEVELOPMENT PROGRAM.
(a) In General.--The Secretary, acting through the Rural
Business Cooperative Service, shall make competitive grants to
eligible entities to enable the eligible entities to carry out
a program to assist farmers and ranchers, and to rural small
businesses (as determined by the Secretary) in becoming more
energy efficient and in using renewable energy technology.
(b) Eligible Entities.--Entities eligible to carry out a
program under subsection (a) include--
(1) a State energy or agricultural office;
(2) a regional or State-based energy organization or
energy organization of an Indian tribe (as defined in
section 4 of the Indian Self-Determination and
Education Assistance Act (25 U.S.C. 450b));
(3) a land-grant college or university (as defined in
section 1404 of the National Agricultural Research,
Extension, and Teaching Policy Act of 1977 (7 U.S.C.
3103)) or other college or university;
(4) a farm bureau or organization;
(5) a rural electric cooperative or utility;
(6) a nonprofit organization; and
(7) any other entity, as determined by the Secretary.
(c) Merit Review.--
(1) Merit review panel.--The Secretary shall
establish a merit review panel to review applications
for grants under subsection (a) that draws on the
expertise of other Federal agencies (including the
Department of Energy and the Environmental Protection
Agency),industry, and nongovernmental organizations.
(2) Selection criteria.--In reviewing applications of
eligible entities to receive grants under subsection
(a), the merit review panel shall consider--
(A) the ability and expertise of the eligible
entity in providing professional energy audits
and renewable energy assessments;
(B) the geographic scope of the program
proposed by the eligible entity;
(C) the number of farmers, ranchers, and
rural small businesses to be assisted by the
program;
(D) the potential for energy savings and
environmental and public health benefits
resulting from the program; and
(E) the plan of the eligible entity for
educating farmers, ranchers, and rural small
businesses on the benefits of energy efficiency
and renewable energy development.
(d) Use of Grant Funds.--A recipient of a grant under
subsection (a) shall use the grant funds to--
(1)(A) conduct energy audits for farmers, ranchers,
and rural small businesses to provide farmers,
ranchers, and rural small businesses recommendations
for energy efficiency and renewable energy development
opportunities; and
(B) conduct workshops on that subject as appropriate;
(2) make farmers, ranchers, and rural small
businesses aware of and ensure that they have access
to--
(A) financial assistance under section 388G;
and
(B) other Federal, State, and local financial
assistance programs for which farmers,
ranchers, and rural small businesses may be
eligible; and
(3) arrange private financial assistance to farmers,
ranchers, and rural small businesses on favorable
terms.
(e) Cost Sharing.--
(1) In general.--A recipient of a grant under
subsection (a) that conducts an energy audit for a
farmer, rancher, or rural small business under
subsection (d)(1) shall require that, as a condition to
the conduct of the energy audit, the farmer, rancher,
or rural small business pay at least 25 percent of the
cost of the audit.
(2) Implementation of recommendations.--If a farmer,
rancher, or rural small business substantially
implements the recommendations made in connection with
an energy audit, the Secretary may reimburse the
farmer, rancher, or rural small business the amount
that is equal to the share of the cost paid by the
farmer, rancher, or rural small business under
paragraph (1).
(f) Reports.--The Secretary shall submit to the Committee
on Agriculture of the House of Representatives and the
Committee on Agriculture, Nutrition, and Forestry of the Senate
an annual report on the implementation of this section.
(g) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this subtitle, and on October 1,
2002, and each October 1 thereafter through October 1,
2005, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary to carry out this section
$15,000,000, to remain available until expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
SEC. 388G. LOANS, LOAN GUARANTEES, AND GRANTS TO FARMERS, RANCHERS, AND
RURAL SMALL BUSINESSES FOR RENEWABLE ENERGY SYSTEMS
AND ENERGY EFFICIENCY IMPROVEMENTS.
(a) In General.--In addition to exercising authority to
make loans and loan guarantees under other law, the Secretary
shall make loans, loan guarantees, and grants to farmers,
ranchers, and rural small businesses to--
(1) purchase renewable energy systems; and
(2) make energy efficiency improvements.
(b) Eligibility of Farmers and Ranchers.--To be eligible to
receive a grant under subsection (a) for a fiscal year, a
farmer or rancher shall have produced not more than $1,000,000
in market value of agricultural products during the preceding
fiscal year, as determined by the Secretary.
(c) Cost Sharing.--
(1) Renewable energy systems.--
(A) In general.--
(i) Grants.--The amount of a grant
made under subsection (a) for a
renewable energy system shall not
exceed 15 percent of the cost of the
renewable energy system.
(ii) Loans.--The amount of a loan
made or guaranteed under subsection (a)
for a renewable energy system shall not
exceed 35 percent of the cost of the
renewable energy system.
(B) Factors.--In determining the amount of a
grant or loan under subparagraph (A), the
Secretary shall take into consideration--
(i) the type of renewable energy
system to be purchased;
(ii) the estimated quantity of energy
to be generated or displaced by the
renewable energy system;
(iii) the expected environmental
benefits of the renewable energy
system;
(iv) the extent to which the
renewable energy system will be
replicable; and
(v) other factors as appropriate.
(2) Energy efficiency improvements.--
(A) In general.--
(i) Grants.--The amount of a grant
made under subsection (a) for an energy
efficiency improvement shall not exceed
15 percent of the cost of the energy
efficiency improvement.
(ii) Loans.--The amount of a loan
made or guaranteed under subsection (a)
for an energy efficiency project shall
not exceed 35 percent of the cost of
the energy efficiency improvement.
(B) Factors.--In determining the amount of a
grant or loan under subparagraph (A), the
Secretary shall take into consideration--
(i) the estimated length of time it
would take for the energy savings
generated by the improvement to equal
the cost of the improvement;
(ii) the amount of energy savings
expected to be derived from the
improvement; and
(iii) other factors as appropriate.
(d) Interest Rate.--A loan made or guaranteed under
subsection (a) shall bear interest at a rate not exceeding 4
percent.
(e) Energy Audit and Renewable Energy Development
Program.--
(1) Preference.--In making loans, loan guarantees,
and grants under subsection (a), the Secretary shall
give preference to participants in the energy audit and
renewable energy development program under section
388F.
(2) Reservation of funding.--The Secretary shall
reserve at least 25 percent of the funds made available
to carry out this section for each of fiscal years 2002
through 2006 to participants in the energy audit and
renewable energy development program under section
388F.
(f) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this subtitle, and on October 1,
2002, and each October 1 thereafter through October 1,
2005, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary to carry out this section
$33,000,000, to remain available until expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
(3) Loan and interest subsidies.--In the case of a
loan or loan guarantee under subsection (a), the
Secretary shall use funds under paragraph (1) to pay
the cost of loan and interest subsidies necessary to
carry out this section.
SEC. 388H. HYDROGEN AND FUEL CELL TECHNOLOGIES PROGRAM.
(a) In General.--The Secretary of Agriculture, in
consultation with the Secretary of Energy, shall establish a
program under which the Secretary of Agriculture shall
competitively award grants to, or enter into contracts or
cooperative agreements with, eligible entities for--
(1) projects to demonstrate the use of hydrogen
technologies and fuel cell technologies in farm, ranch,
and rural applications; and
(2) as appropriate, studies of the technical,
environmental, and economic viability, in farm and
rural applications, of innovative hydrogen and fuel
cell technologies not ready for demonstration.
(b) Eligible Entities.--Under subsection (a), the Secretary
may make a grant to or enter into a contract or cooperative
agreement with--
(1) a Federal research agency;
(2) a national laboratory;
(3) a college or university or a research foundation
maintained by a college or university;
(4) a private research organization with an
established and demonstrated capacity to perform
research or technology transfer;
(5) a State agricultural experiment station; or
(6) an individual.
(c) Selection Criteria.--In selecting projects for grants,
contracts, and cooperative agreements under subsection (a)(1),
the Secretary shall give preference to projects that
demonstrate technologies that--
(1) are innovative;
(2) use renewable energy sources;
(3) produce multiple sources of energy;
(4) provide significant environmental benefits;
(5) are likely to be economically competitive; and
(6) have potential for commercialization as mass-
produced, farm-sized systems.
(d) Cost Sharing.--The amount of financial assistance
provided for a project under a grant, contract, or cooperative
agreement under subsection (a) shall not exceed 50 percent of
the cost of the project.
(e) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this subtitle, and on October 1,
2002, and each October 1 thereafter through October 1,
2005, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary to carry out this section
$5,000,000, to remain available until expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
SEC. 388I. TECHNICAL ASSISTANCE FOR FARMERS AND RANCHERS TO DEVELOP
RENEWABLE ENERGY RESOURCES.
(a) In General.--The Secretary, acting through the
Cooperative State Research, Education, and Extension Service in
consultation with the Natural Resources Conservation Service,
regional biomass programs under the Department of Energy, and
other entities as appropriate, may provide for education and
technical assistance to farmers and ranchers for the
development and marketing of renewable energy resources.
(b) Administrative Expenses.--The Secretary may retain up
to 4 percent of the amounts made available for each fiscal year
to carry out this section to pay administrative expenses
incurred in carrying out this section.
CHAPTER 3--CARBON SEQUESTRATION RESEARCH, DEVELOPMENT, AND
DEMONSTRATION PROGRAM
SEC. 388J. RESEARCH.
(a) Basic Research.--
(1) In general.--Subject to the availability of
appropriations, the Secretary shall carry out research
to promote understanding of--
(A) the net sequestration of organic carbon
in soils and plants (including trees); and
(B) net emissions of other greenhouse gases
from agriculture.
(2) Agricultural research service.--The Secretary,
acting through the Agricultural Research Service, shall
collaborate with other Federal agencies in developing
data and carrying out research addressing carbon losses
and gains in soils and plants (including trees) and net
emissions of methane and nitrous oxide from cultivation
and animal management activities.
(3) Cooperative state research, education, and
extension service.--
(A) In general.--The Secretary, acting
through the Cooperative State Research,
Education, and Extension Service, shall
establish a competitive grant program to carry
out research on the matters described in
paragraph (1) by eligible entities.
(B) Eligible entities.--Uner subparagraph
(A), the Secretary may make a grant to--
(i) a Federal research agency;
(ii) a national laboratory;
(iii) a college or university or a
research foundation maintained by a
college or university;
(iv) a private research organization
with an established and demonstrated
capacity to perform research or
technology transfer;
(v) a State agricultural experiment
station; or
(vi) an individual.
(C) Consultation on research topics.--Before
issuing a request for proposals for basic
research under paragraph (1), the Cooperative
State Research, Education, and Extension
Service shall consult with the Agricultural
Research Service and the Forest Service to
ensure that proposed research areas are
complementary with and do not duplicate
research projects funded by the Department or
other Federal agencies.
(D) Administrative expenses.--The Secretary
may retain up to 4 percent of the amounts made
available for each fiscal year to carry out
this subsection to pay administrative expenses
incurred in carrying out this subsection.
(b) Applied Research.--
(1) In general.--The Secretary shall carry out
applied research in the areas of soil science,
agronomy, agricultural economics, forestry, and other
agricultural sciences to--
(A) promote understanding of--
(i) how agricultural and forestry
practices affect the sequestration of
organic and inorganic carbon in soils
and plants (including trees) and net
emissions of other greenhouse gases;
(ii) how changes in soil carbon pools
in soils and plants (including trees)
are cost-effectively measured,
monitored, and verified; and
(iii) how public programs and private
market approaches can be devised to
incorporate carbon sequestration in a
broader societal greenhouse gas
emission reduction effort;
(B) develop methods for establishing
baselines for measuring the quantities of
carbon and other greenhouse gases sequestered;
and
(C) evaluate leakage and performance issues.
(2) Requirements.--To the maximum extent practicable,
applied research under paragraph (1) shall--
(A) use existing technologies and methods;
and
(B) provide methodologies that are accessible
to a nontechnical audience.
(3) Minimization of adverse environmental impacts.--
All applied research under paragraph (1) shall be
conducted with an emphasis on minimizing adverse
environmental impacts.
(4) Natural resources and the environment.--The
Secretary, acting through the Natural Resources
Conservation Service and the Forest Service, shall
collaborate with other Federal agencies in developing
new measuring techniques and equipment or adapting
existing techniques and equipment to enable cost-
effective and accurate monitoring and verification, for
a wide range of agricultural and forestry practices,
of--
(A) changes in carbon content in soils and
plants (including trees); and
(B) net emissions of other greenhouse gases.
(5) Cooperative state research, education, and
extension service.--
(A) In general.--The Secretary, acting
through the Cooperative State Research,
Education, and Extension Service and the Forest
Service, shall establish a competitive grant
program to encourage research on the matters
described in paragraph (1) by eligible
entities.
(B) Eligible entities.--Under subparagraph
(A), the Secretary may make a grant to--
(i) a Federal research agency;
(ii) a national laboratory;
(iii) a college or university or a
research foundation maintained by a
college or university;
(iv) a private research organization
with an established and demonstrated
capacity to perform research or
technology transfer;
(v) a State agricultural experiment
station; or
(vi) an individual.
(C) Consultation on research topics.--Before
issuing a request for proposals for applied
research under paragraph (1), the Cooperative
State Research, Education, and Extension
Service and the Forest Service shall consult
with the Natural Resources Conservation Service
and the Agricultural Research Service to ensure
that proposed research areas are complementary
with and do not duplicate research projects
funded by the Department of Agriculture or other
Federal agencies.
(D) Administrative expenses.--The Secretary,
acting through the Cooperative State Research,
Education, and Extension Service, may retain up
to 4 percent of the amounts made available for
each fiscal year to carry out this subsection
to pay administrative expenses incurred in
carrying out this subsection.
(c) Research Consortia.--
(1) In general.--The Secretary may designate not more
than 2 research consortia to carry out research
projects under this section, with the requirement that
the consortia propose to conduct basic research under
subsection (a) and applied research under subsection
(b) .
(2) Selection.--The consortia shall be selected on a
competitive basis by the Cooperative State Research,
Education, and Extension Service.
(3) Eligible consortium participants.--Entities
eligible to participate in a consortium include--
(A) a land grant college and university (as
defined in section 1404 of the National
Agricultural Research, Extension, and Teaching
Policy Act of 1977 (7 U.S.C. 3103));
(B) a private research institution;
(C) a State agency;
(D) an Indian tribe (as defined in section 4
of the Indian Self-Determination and Education
Assistance Act (25 U.S.C. 450b));
(E) an agency of the Department of
Agriculture;
(F) a research center of the National
Aeronautics and Space Administration and the
Department of Energy, or any other Federal
agency;
(G) an agricultural business or organization
with demonstrated expertise in areas covered by
this section; and
(H) a representative of the private sector
with demonstrated expertise in the areas.
(4) Reservation of funding.--If the Secretary
designates 1 or 2 consortia, the Secretary shall
reserve for research projects carried out by the
consortium or consortia not more than 25 percent of the
amounts made available to carry out this section for a
fiscal year.
(d) Standards for Measuring Carbon and Other Greenhouse Gas
Content.--
(1) Conference.--Not later than 3 years after the
date of enactment of this subtitle, the Secretary shall
convene a conference of key scientific experts on
carbon sequestration from various sectors (including
the government, academic, and private sectors) to--
(A) discuss and establish benchmark standards
of precision for measuring the carbon content
of soils and plants (including trees) and net
emissions of other greenhouse gases;
(B) propose techniques and modeling
approaches for measuring carbon content with a
level of precision that is agreed on by the
participants in the conference; and
(C) evaluate results of analyses on baseline,
permanence, and leakage issues.
(2) Report.--Not later than 180 days after the
conclusion of the conference under paragraph (1), the
Secretary shall submit to the Committee on Agriculture
of the House of Representatives and the Committee on
Agriculture, Nutrition, and Forestry of the Senate a
report on the results of the conference.
(e) Authorization of Appropriations.--
(1) In general.--There are authorized to be
appropriated to carry out this section $25,000,000 for
each of fiscal years 2002 through 2006.
(2) Allocation.--
(A) In general.--Of the amounts made
available to carry out this section for a
fiscal year, at least 50 percent shall be
allocated for competitive grants by the
Cooperative State Research, Education, and
Extension Service.
(B) Administrative expenses.--The Secretary
may retain up to 4 percent of the amounts made
available for each fiscal year to carry out
this section to pay administrative expenses
incurred in carrying out this section.
SEC. 388K. DEMONSTRATION PROJECTS AND OUTREACH.
(a) Demonstration Projects.--
(1) Development of monitoring programs.--
(A) In general.--The Secretary, in
cooperation with local extension agents,
experts from land grant universities, and other
local agricultural or conservation
organizations, shall develop user-friendly
programs that combine measurement tools and
modeling techniques into integrated packages to
monitor the carbon sequestering benefits of
conservation practices and net changes in
greenhouse gas emissions.
(B) Benchmark levels of precision.--The
Secretary shall administer programs developed
under subparagraph (A) in a manner that
achieves, to the maximum extent practicable,
benchmark levels of precision in the
measurement in a cost-effective manner, of
benefits and changes described in subparagraph
(A).
(2) Projects.--
(A) In general.--The Secretary shall
establish a program under which the monitoring
programs developed under paragraph (1) are used
in projects to demonstrate the feasibility of
methods of measuring, verifying, and
monitoring--
(i) changes in organic carbon content
and other carbon pools in soils and
plants (including trees); and
(ii) net changes in emissions of
other greenhouse gases.
(B) Evaluation of implications.--The projects
under subparagraph (A) shall include evaluation
of the implications for reassessed baselines,
carbon or other greenhouse gas leakage, and the
permanence of sequestration.
(C) Submission of proposals.--Proposals for
projects under subparagraph (A) shall be
submitted by the appropriate agency of each
State, in consultation with interested local
jurisdictions and State agricultural and
conservation organizations.
(D) Limitation.--Not more than 10 projects
under subparagraph (A) may be approved in
conjunction with applied research projects
under section 388J(b) until benchmark
measurement and assessment standards are
established under section 388J(d).
(b) Outreach.--
(1) In general.--The Secretary, acting through the
Cooperative State Research, Education, and Extension
Service shall widely disseminate information about the
economic and environmental benefits that can be
generated by adoption of conservation practices that
increase sequestration of carbon and reduce emission of
other greenhouse gases.
(2) Project results.--The Secretary, acting through
the Cooperative State Research, Education, and
Extension Service shall provide for the dissemination
to farmers, ranchers, private forest landowners, and
appropriate State agencies in each State of information
concerning--
(A) the results of demonstration projects
under subsection (a)(2); and
(B) the manner in which the methods
demonstrated in the projects might be
applicable to the operations of the farmers and
ranchers.
(3) Policy outreach.--The Secretary, acting through
the Cooperative State Research, Education, and
Extension Service shall disseminate information on the
connection between global climate change mitigation
strategies and agriculture and forestry, so that
farmers and ranchers may better understand the global
implications of the activities of farmers and ranchers.
(c) Authorization of Appropriations.--
(1) In general.--There is authorized to be
appropriated to carry out this section $10,000,000 for
each of fiscal years 2002 through 2006.
(2) Allocation.--Of the amounts made available to
carry out this section for a fiscal year, at least 50
percent shall be allocated for demonstration projects
under subsection (a)(2).
* * * * * * *
SEC. 21. FINANCIAL AND TECHNICAL ASSISTANCE FOR RENEWABLE ENERGY
SYSTEMS.
(a) Definition of Renewable Energy.--In this section, the
term ``renewable energy'' means energy derived from a wind,
solar, biomass, geothermal, or hydrogen source.
(b) Loans, Loan Guarantees, and Grants.--The Secretary
shall make loans, loan guarantees, and grants to rural electric
cooperatives and other rural electric utilities to promote the
development of economically and environmentally sustainable
renewable energy projects to serve the needs of rural
communities or for rural economic development.
(c) Interest Rate.--A loan made or guaranteed under
subsection (b) shall bear interest at a rate not exceeding 4
percent.
(d) Use of Funds.--
(1) Grants.--A recipient of a grant under subsection
(a) may use the grant funds to pay up to 75 percent of
the cost of an economic feasibility study or technical
assistance for a renewable energy project.
(2) Loans.--If a renewable energy project is
determined to be economically feasible, a recipient of
a loan or loan guarantee under subsection (a) may use
the loan funds to pay a percentage of the cost of the
project determined by the Secretary.
(e) Funding.--
(1) In general.--Not later than 30 days after the
date of enactment of this section, and on October 1,
2002, and each October 1 thereafter through October 1,
2005, out of any funds in the Treasury not otherwise
appropriated, the Secretary of the Treasury shall
transfer to the Secretary to carry out this section
$9,000,000, to remain available until expended.
(2) Receipt and acceptance.--The Secretary shall be
entitled to receive, shall accept, and shall use to
carry out this section the funds transferred under
paragraph (1), without further appropriation.
(3) Loan and interest subsidies.--In the case of a
loan or loan guarantee under subsection (a), the
Secretary shall use funds under paragraph (1) to pay
the cost of loan and interest subsidies necessary to
carry out this section.
* * * * * * *
(7 U.S.C. 7621 et seq.) is amended by adding at the end the
following:
SEC. 409. CARBON SEQUESTRATION DEMONSTRATION PROGRAM.
(a) Definitions.--In this section:
(1) Eligible project.--The term ``eligible project''
means a project that is likely to result in--
(A) demonstrable reductions in net emissions
of greenhouse gases; or
(B) demonstrable net increases in the
quantity of carbon sequestered in soils and
forests.
(2) Environmental trade.--The term ``environmental
trade'' means a transaction between an emitter of a
greenhouse gas and an agricultural producer under which
the emitter pays to the agricultural producer a fee to
sequester carbon or otherwise reduce emissions of
greenhouse gases.
(3) Panel.--The term ``panel'' means the panel of
experts established under subsection (b)(4)(A).
(4) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture, acting in consultation with--
(A) the Under Secretary of Agriculture for
Natural Resources and Environment;
(B) the Under Secretary of Agriculture for
Research, Education, and Economics;
(C) the Chief Economist of the Department;
and
(D) the panel.
(b) Demonstration Program.--
(1) Establishment.--Subject to the availability of
appropriations, the Secretary shall establish a program
to provide grants, on a competitive, cost-shared basis,
to agricultural producers to assist in paying the costs
incurred in measuring, estimating, monitoring,
verifying, auditing, and testing methodologies involved
in environmental trades (including costs incurred in
employing certified independent third persons to carry
out those activities).
(2) Conditions for receipt of grant.--As a condition
of the acceptance of a grant under paragraph (1), an
agricultural producer shall--
(A) establish a carbon and greenhouse gas
monitoring, verification, and reporting system
that meets such requirements as the Secretary
shall prescribe; and
(B) under the system and through the use of
an independent third party for any necessary
monitoring, verifying, reporting, and auditing,
measure and report to the Secretary the
quantity of carbon sequestered, or the quantity
of greenhouse gas emissions reduced, as a
result of the conduct of an eligible project.
(3) Criteria for award of grant.--
(A) In General.--In awarding a grant for an
eligible project under paragraph (1), the
Secretary shall take into consideration--
(i) the likelihood of the eligible
project in succeeding in achieving
greenhouse gas emissions reductions and
net carbon sequestration increases; and
(ii) the usefulness of the
information to be obtained from the
eligible project in determining how
best to quantify, monitor, and verify
sequestered carbon or reductions in
greenhouse gas emissions.
(B) Priority criteria.--The Secretary shall
give priority in awarding a grant under
paragraph (1) to an eligible project that--
(i) involves multiple parties, a
whole farm approach, or any other
approach, such as the aggregation of
land areas, that would--
(I) increase the
environmental benefits or
reduce the transaction costs of
the eligible project; and
(II) reduce the costs of
measuring, monitoring, and
verifying any net sequestration
of carbon or net reduction in
greenhouse gas emissions;
(ii) is designed to achieve long-term
sequestration of carbon or long-term
reductions in greenhouse gas emissions;
(iii) is designed to address concerns
concerning leakage;
(iv) provides certain other benefits,
such as improvements in--
(I) soil fertility;
(II) wildlife habitat;
(III) water quality;
(IV) soil erosion management;
(V) the use of renewable
resources to produce energy;
(VI) the avoidance of
ecosystem fragmentation; and
(VII) the promotion of
ecosystem restoration with
native species; or
(v) does not involve--
(I) the reforestation of land
that has been deforested since
1990; or
(II) the conversion of native
grassland.
(4) Panel.--
(A) In general.--The Secretary shall
establish a panel to provide advice and
recommendations to the Secretary with respect
to criteria for awarding grants under this
subsection.
(B) Composition.--The panel shall be composed
of the following representatives, to be
appointed by the Secretary:
(i) Experts from each of--
(I) the Department;
(II) the Environmental
Protection Agency; and
(III) the Department of
Energy.
(ii) Experts from nongovernmental and
academic entities.
(5) Payment of grant funds.--The Secretary shall
provide a grant awarded under this section in such
number of installments as is necessary to ensure proper
implementation of an eligible project.
(c) Methodology Grant Program.--
(1) Establishment.--The Secretary shall establish a
program to provide grants to determine the best
methodologies for estimating and measuring increases or
decreases in--
(A) agricultural greenhouse gas emissions;
and
(B) the quantity of carbon sequestered in
soils, forests, and trees.
(2) Eligible recipients.--The Secretary shall award a
grant under paragraph (1), on a competitive basis, to a
college or university, or other research institution,
that seeks to demonstrate the viability of a
methodology described in paragraph (1).
(d) Dissemination of Information.--As soon as practicable
after the date of enactment of this section, the Secretary
shall establish an Internet site through which agricultural
producers may obtain information concerning--
(1) potential environmental trades; and
(2) activities of the Secretary under this section.
(e) Authorization of Appropriations.--There is authorized
to be appropriated to carry out this section $20,000,000 for
each of fiscal years 2002 through 2006.
* * * * * * *
AGRICULTURAL MARKETING ACT OF 1946
* * * * * * *
Subtitle C--Country of Origin Labeling
SEC. 271. DEFINITIONS.
In this subtitle:
(1) Beef.--The term ``beef'' means meat produced from
cattle (including veal).
(2) Covered commodity.--
(A) In general.--The term ``covered
commodity'' means--
(i) muscle cuts of beef, lamb, and
pork;
(ii) ground beef, ground lamb, and
ground pork;
(iii) farm-raised fish;
(iv) a perishable agricultural
commodity; and
(v) peanuts.
(B) Exclusions.--The term ``covered
commodity'' does not include--
(i) processed beef, lamb, and pork
food items; and
(ii) frozen entrees containing beef,
lamb, and pork.
(3) Farm-raised fish.--The term ``farm-raised fish''
includes--
(A) farm-raised shellfish; and
(B) fillets, steaks, nuggets, and any other
flesh from a farm-raised fish or shellfish.
(4) Food service establishment.--The term ``food
service establishment'' means a restaurant, cafeteria,
lunch room, food stand, saloon, tavern, bar, lounge, or
other similar facility operated as an enterprise
engaged in the business of selling food to the public.
(5) Lamb.--The term ``lamb'' means meat, other than
mutton, produced from sheep.
(6) Perishable agricultural commodity; retailer.--The
terms ``perishable agricultural commodity'' and
``retailer'' have the meanings given the terms in
section 1(b) of the Perishable Agricultural Commodities
Act, 1930 (7 U.S.C. 499a(b)).
(7) Pork.--The term ``pork'' means meat produced from
hogs.
(8) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture, acting through the
Agricultural Marketing Service.
SEC. 272. NOTICE OF COUNTRY OF ORIGIN.
(a) In General.--
(1) Requirement.--Except as provided in subsection
(b), a retailer of a covered commodity shall inform
consumers, at the final point of sale of the covered
commodity to consumers, of the country of origin of the
covered commodity.
(2) United states country of origin.--A retailer of a
covered commodity may designate the covered commodity
as having a United States country of origin only if the
covered commodity--
(A) in the case of beef, lamb, and pork, is
exclusively from an animal that is exclusively
born, raised, and slaughtered in the United
States; and
(B) in the case of farm-raised fish, is
hatched, raised, harvested, and processed in
the United States; and
(C) in the case of a perishable agricultural
commodities or peanut, is exclusively produced
in the United States.
(b) Exemption for Food Service Establishments.--Subsection
(a) shall not apply to a covered commodity if the covered
commodity is--
(1) prepared or served in a food service
establishment; and
(2)(A) offered for sale or sold at the food
service establishment in normal retail quantities; or
(B) served to consumers at the food service
establishment.
(c) Method of Notification.--
(1) In general.--The information required by
subsection (a) may be provided to consumers by means of
a label, stamp, mark, placard, or other clear and
visible sign on the covered commodity or on the
package, display, holding unit, or bin containing the
commodity at the final point of sale to consumers.
(2) Labeled commodities.--If the covered commodity is
already individually labeled for retail sale regarding
country of origin, the retailer shall not be required
to provide any additional information to comply with
this section.
(d) Audit Verification System.--The Secretary may require
that any person that prepares, stores, handles, or distributes
a covered commodity for retail sale maintain a verifiable
recordkeeping audit trail that will permit the Secretary to
ensure compliance with the regulations promulgated under
section 274.
(e) Information.--Any person engaged in the business of
supplying a covered commodity to a retailer shall provide
information to the retailer indicating the country of origin of
the covered commodity.
(f) Certification of Origin.--
(1) Mandatory identification.--The Secretary shall
not use a mandatory identification system to verify the
country of origin of a covered commodity.
(2) Existing certification programs.--To certify the
country of origin of a covered commodity, the Secretary
may use as a model certification programs in existence
on the date of enactment of this Act, including--
(A) the carcass grading and certification
system carried out under this Act;
(B) the voluntary country of origin beef
labeling system carried out under this Act;
(C) voluntary programs established to certify
certain premium beef cuts;
(D) the origin verification system
established to carry out the child and adult
care food program established under section 17
of the Richard B. Russell National School Lunch
Act (42 U.S.C. 1766); or
(E) the origin verification system
established to carry out the market access
program under section 203 of the Agricultural
Trade Act of 1978 (7 U.S.C. 5623).
SEC. 273. ENFORCEMENT.
(a) In General.--Except as provided in subsection (b),
section 253 shall apply to a violation of this subtitle.
(b) Warnings.--If the Secretary determines that a retailer
is in violation of section 272, the Secretary shall--
(1) notify the retailer of the determination of the
Secretary; and
(2) provide the retailer a 30-day period, beginning
on the date on which the retailer receives the notice
under paragraph (1) from the Secretary, during which
the retailer may take necessary steps to comply with
section 272.
(c) Fines.--If, on completion of the 30-day period
described in subsection (c)(2), the Secretary determines that
the retailer has willfully violated section 272, after
providing notice and an opportunity for a hearing before the
Secretary with respect to the violation, the Secretary may fine
the retailer in an amount determined by the Secretary.
SEC. 274. REGULATIONS.
(a) In General.--The Secretary may promulgate such
regulations as are necessary to carry out this subtitle.
(b) Partnerships With States.--In promulgating the
regulations, the Secretary shall, to the maximum extent
practicable, enter into partnerships with States with
enforcement infrastructure to carry out this subtitle.
SEC. 275. APPLICATION.
This subtitle shall apply to the retail sale of a covered
commodity beginning on the date that is 180 days after the date
of the enactment of this subtitle.
* * * * * * *
Subtitle D--Commodity-Specific Grading Standards
SEC. 281. DEFINITION OF SECRETARY.
In this subtitle, the term ``Secretary'' means the
Secretary of Agriculture.
SEC. 282. QUALITY GRADE LABELING OF IMPORTED MEAT AND MEAT FOOD
PRODUCTS.
An imported carcass, part thereof, meat, or meat food
product (as defined by the Secretary) shall not bear a label
that indicates a quality grade issued by the Secretary.
SEC. 283. REGULATIONS.
The Secretary shall promulgate such regulations as are
necessary to ensure compliance with, and otherwise carry out,
this subtitle.
* * * * * * *
FEDERAL CROP INSURANCE ACT
* * * * * * *
SEC. 508. CROP INSURANCE.
* * * * * * *
(e) Payment of Portion of Premium by Corporation.--
(1) In general.--For the purpose of encouraging the
broadest possible participation of producers in the
catastrophic risk protection provided under subsection
(b) and the additional coverage provided under
subsection (c), the Corporation shall pay a part of the
premium in the amounts provided in accordance with this
subsection.
* * * * * * *
(3) Premium reduction.--If an approved insurance
provider determines that the provider may provide
insurance more efficiently than the expense
reimbursement amount established by the Corporation,
the approved insurance provider may reduce, subject to
the approval of the Corporation, the premium charged
the insured by an amount corresponding to the
efficiency. The approved insurance provider shall apply
to the Corporation for authority to reduce the premium
before making such a reduction, and the reduction shall
be subject to the rules, limitations, and procedures
established by the Corporation.
(4) [Temporary prohibition] Prohibition on continuous
coverage.--Notwithstanding paragraph (2), during each
of the 2001 [through 2005] and subsequent reinsurance
years, additional coverage under subsection (c) shall
be available only in 5 percent increments beginning at
50 percent of the recorded or appraised average yield.
(5) Premium payment disclosure.--Each policy or plan
of insurance under this title shall prominently
indicate the dollar amount of the portion of the
premium paid by the Corporation.
(f) Eligibility.--
* * * * * * *
(m) Quality Loss Adjustment Coverage.--
(1) Effect of coverage.--If a policy or plan of
insurance offered under this title includes quality
loss adjustment coverage, the coverage shall provide
for a reduction in the quantity of production of the
agricultural commodity considered produced during a
crop year, or a similar adjustment, as a result of the
agricultural commodity not meeting the quality
standards established in the policy or plan of
insurance.
(2) Additional quality loss adjustment.--
(A) Producer option.--Notwithstanding any
other provision of law, in addition to the
quality loss adjustment coverage available
under paragraph (1), the Corporation shall
offer producers the option of purchasing
quality loss adjustment coverage on a basis
that is smaller than a unit with respect to an
agricultural commodity that satisfies each of
the following:
(i) The agricultural commodity is
sold on an identity-preserved basis.
(ii) All quality determinations are
made solely by the Federal agency
designated to grade or classify the
agricultural commodity.
(iii) All quality determinations are
made in accordance with standards
published by the Federal agency in the
Federal Register.
(iv) The discount schedules that
reflect the reduction in quality of the
agricultural commodity are established
by theSecretary.
(B) Basis for adjustment.--Under this
paragraph, the Corporation shall set the
quality standards below which quality losses
will be paid based on the variability of the
grade of the agricultural commodity from the
base quality for the agricultural commodity.
(3) Review of criteria and procedures.--[The
Corporation]
(A) Review.--The Corporation shall contract
with a qualified person to review the quality
loss adjustment procedures of the Corporation
so that the procedures more accurately reflect
local quality discounts that are applied to
agricultural commodities insured under this
title. [Based on]
(B) Procedures.--Effective beginning not
later than the 2003 reinsurance year, based on
the review, the Corporation shall make
adjustments in the procedures, taking into
consideration the actuarial soundness of the
adjustment and the prevention of fraud, waste,
and abuse.
* * * * * * *
CONTROLLED SUBSTANCES ACT (21 U.S.C. 889)
* * * * * * *
Sec. 519. (a) As used in this section:
(1) The term ``controlled substance'' has the same
meaning given such term in section 102(6) of the
Controlled Substances Act (21 U.S.C. 801(6)).
(2) The term ``Secretary'' means the Secretary of
Agriculture.
(3) The term ``State'' means each of the fifty
States, the District of Columbia, the Commonwealth of
Puerto Rico, Guam, the Virgin Islands of the United
States, American Samoa, the Commonwealth of the
Northern Mariana Islands, or the Trust Territory of the
Pacific Islands.
(b) Notwithstanding any other provision of law, following
the date of enactment of this Act, any person who is convicted
under Federal or State law of planting, cultivation, growing,
producing, harvesting, or storing a controlled substance in any
crop year shall be ineligible for--
(1) as to any commodity produced during that crop
year, and the four succeeding crop years, by such
person--
[(A) any price support or payment made
available under the Agricultural Act of 1949 (7
U.S.C. 1421 et seq.), the Commodity Credit
Corporation Charter Act (15 U.S.C. 714 et
seq.), or any other Act;]
(A) contract payments under a contract,
marketing assistance loans, and any type of
price support or payment made available under
the Agricultural Market Transition Act (7
U.S.C. 7201 et seq.), the Commodity Credit
Corporation Charter Act (15 U.S.C. 714 et
seq.), or any other Act;
(B) a farm storage facility loan made under
section 4(h) of the Commodity Credit
Corporation Charter Act (15 U.S.C. 714b(h));
[(C) crop insurance under the Federal Crop
Insurance Act (7 U.S.C. 1501 et seq.);
[(D) a disaster payment made under the
Agricultural Act of 1949 (7 U.S.C. 1421 et
seq.); or]
(C) an indemnity payment under the Federal
Crop Insurance Act (7 U.S.C. 1501 et seq.);
(D) a disaster payment; or
(E) a loan made, insured or guaranteed under
the Consolidated Farm and Rural Development Act
(7 U.S.C. 1921 et seq.) or any other provision
of law administered by the Farmers Home
Administration; or
(2) a payment made under section 4 or 5 of the
Commodity Credit Corporation Charter Act (15 U.S.C.
714b or 714c) for the storage of an agricultural
commodity that is--
(A) produced during that crop year, or any of
the four succeeding crop years, by such person;
and
(B) acquired by the Commodity Credit
Corporation[.]; or
(3) during the crop year--
(A) a payment made pursuant to a contract
entered into under the environmental quality
incentives program under chapter 4 of subtitle
D of title XII of the Food Security Act of 1985
(16 U.S.C. 3839aa et seq.);
(B) a payment under any other provision of
subtitle D of title XII of that Act (16 U.S.C.
3830 et seq.);
(C) a payment under section 401 or 402 of the
Agricultural Credit Act of 1978 (16 U.S.C.
2201, 2202); or
(D) a payment, loan, or other assistance
under section 3 or 8 of the Watershed
Protection and Flood Prevention Act (16 U.S.C.
1003 and 1006a).
* * * * * * *
PACKERS AND STOCKYARDS ACT, 1921
* * * * * * *
SEC. 318. UNLAWFUL STOCKYARD PRACTICES INVOLVING NONAMBULATORY
LIVESTOCK.
(a) Definitions.--In this section:
(1) Humanely euthanized.--The term ``humanely
euthanized'' meansto kill an animal by mechanical,
chemical, or other means that immediately render the animal
unconscious, with this state remaining until the animal's death.
(2) Nonambulatory livestock.--The term
``nonambulatory livestock'' means any livestock that is
unable to stand and walk unassisted.
(b) Unlawful Practices.--
(1) In general.--It shall be unlawful under section
312 for any stockyard owner, market agency, or dealer
to buy, sell, give, receive, transfer, market, hold, or
drag any nonambulatory livestock unless the
nonambulatory livestock has been humanely euthanized.
(2) Exceptions.--
(A) Non-gipsa farms.--Paragraph (1) shall not
apply to any farm the animal care practices of
which are not subject to the authority of the
Grain Inspection, Packers, and Stockyards
Administration.
(B) Veterinary care.--Paragraph (1) shall not
apply in a case in which nonambulatory
livestock receive veterinary care intended to
render the livestock ambulatory.
* * * * * * *
ANIMAL WELFARE ACT
* * * * * * *
Sec. 26. (a) It shall be unlawful for any person to
knowingly sponsor or exhibit an animal in any animal fighting
venture to which any animal was moved in interstate or foreign
commerce.
(b) It shall be unlawful for any person to knowingly sell,
buy, transport, or deliver to another person or receive from
another person for purposes of transportation, in interstate or
foreign commerce, any dog or other animal for purposes of
having the dog or other animal participate in an animal
fighting venture.
(c) It shall be unlawful for any person to knowingly use
the mail service of the United States Postal Service or any
interstate instrumentality for purposes of promoting or in any
other manner furthering an animal fighting venture except as
performed outside the limits of the State of the United States.
[(d) Notwithstanding the provisions of subsections (a),
(b), or (c) of this section, the activities prohibited by such
subsections shall be unlawful with respect to fighting ventures
involving live birds only if the fight is to take place in a
State where it would be in violation of the laws thereof.]
(d) Activities Not Subject to Prohibition.--This section
does not apply to the selling, buying, transporting, or
delivery of an animal in interstate or foreign commerce for any
purpose, so long as the purpose does not include participation
of the animal in an animal fighting venture.
(e) Penalties.--Any person who violates subsection (a),
(b), or (c) shall be fined not more than [$5,000] $15,000 or
imprisoned for not more than [1 year] 2 years, or both, for
each such violation.
(f) The secretary or any other authorized by him shall make
such investigations as the Secretary deems necessary to
determine whether any person has violated or is violating any
provision of this section, and the Secretary may obtain the
assistance of the Federal Bureau of Investigations, the
Department of the Treasury, or other law enforcement agencies
of the United States, and State and local governmental
agencies, in the conduct of such investigations, under
cooperative agreements with such agencies. A warrant to search
for and seize any animal which there is probable cause to
believe was involved in any violation of this section may be
issued by any judge of the United States or of a State court of
record or by a United States magistrate within the district
wherein the animal sought is located. Any United States marshal
or any person authorized under this section to conduct
investigations may apply for and execute any such warrant, and
any animal seized under such a warrant shall be held by the
United States marshal or other authorized person pending
disposition thereof by the court in accordance with this
paragraph (f). Necessary care including veterinary treatment
shall be provided while the animals are so held in custody. Any
animal involved in any violation of this section shall be
liable to be proceeded against and forfeited to the United
States at any time on complaint filed in any United States
district court or other court of the United States for any
jurisdiction in which the animal is found and upon a judgment
of forfeiture shall be disposed of by sale for lawful purposes
or by other humane means, as the court may direct. Costs
incurred by the United States for care of animals seized and
forfeited under this section shall be recoverable from the
owner of the animals if he appears in such forfeiture
proceeding or in a separate civil action brought in the
jurisdiction in which the owner is found, resides, or transacts
business.
(g) For purposes of this section--
(1) the term ``animal fighting venture'' means any
event whichinvolves a fight between at least two
animals and is conducted for purposes of sport, wagering, or
entertainment except that the term ``animal fighting venture'' shall
not be deemed to include any activity the primary purpose of which
involves the use of one or more animals in hunting another animal or
animals, such as waterfowl, bird, raccoon, or fox hunting;
(2) the term ``interstate or foreign commerce''
means--
(A) any movement between any place in a State
to any place in another State or between places
in the same State through another State; or
(B) any movement from a foreign country into
any State or from any State into any foreign
country;
(3) the term ``interstate instrumentality'' means
telegraph, telephone, radio, or television operating in
interstate or foreign commerce;
(4) the term ``State'' means any State of the United
States, the District of Columbia, the Commonwealth of
Puerto Rico, and any territory or possession of the
United States;
(5) the term ``animal'' means any live bird, or any
live dog or other mammal, except man; and
(6) the conduct by any person of any activity
prohibited by this section shall not render such person
subject to the other sections of this Act as a dealer,
exhibitor, otherwise.
(h)(1) The provisions of this Act shall not supersede or
otherwise invalidate any such State, local, or municipal
legislation or ordinance relating to animal fighting ventures
except in case of a direct and irreconcilable conflict between
any requirements thereunder and this Act or any rule,
regulation, or standard hereunder.
* * * * * * *
FOOD, AGRICULTURE, CONSERVATION, AND TRADE ACT OF 1990
* * * * * * *
SEC. 2501. OUTREACH AND ASSISTANCE FOR SOCIALLY DISADVANTAGED FARMERS
AND RANCHERS.
[(a) Outreach and Assistance.--
[(1) In general.--The Secretary of Agriculture
(hereafter referred to in this section as the
``Secretary'') shall provide outreach and technical
assistance to encourage and assist socially
disadvantaged farmers and ranchers to own and operate
farms and ranches and to participate in agricultural
programs. This assistance should include information on
application and bidding procedures, farm management,
and other essential information to participate in
agricultural programs.
[(2) Grants and contracts.--The Secretary may make
grants and enter into contracts and other agreements in
the furtherance of this section with the following
entities--
[(A) any community based organization that--
[(i) has demonstrated experience in
providing agricultural education or
other agriculturally related services
to socially disadvantaged farmers and
ranchers;
[(ii) provides documentary evidence
of its past experience of working with
socially disadvantaged farmers and
ranchers during the two years preceding
its application for assistance under
this section; and
[(iii) does not engage in activities
prohibited under section 501(c)(3) of
the Internal Revenue Code of 1986; and
[(B) 1890 Land-Grant Colleges including
Tuskegee Institute, Indian tribal community
colleges and Alaska native cooperative
colleges, Hispanic serving post-secondary
educational institutions, and other post-
secondary educational institutions with
demonstrated experience in providing
agriculture education or other agriculturally
related services to socially disadvantaged
family farmers and ranchers in their region.
[(3) Funding.--There are authorized to be
appropriated $10,000,000 for each fiscal year to carry
out this section.]
(a) Outreach and Assistance.--
(1) Definitions.--In this subsection:
(A) Department.--The term ``Department''
means the Department of Agriculture.
(B) Eligible entity.--The term ``eligible
entity'' means--
(i) any community-based organization,
network, or coalition of community-
based organizations that--
(I) has demonstrated
experience in providing
agricultural education or other
agriculturally related services
to socially disadvantaged
farmers and ranchers;
(II) has provided to the
Secretary documentary evidence
of work with socially
disadvantaged farmers and
ranchers during the 2-year
period preceding the submission
of an application for
assistance under this
subsection; and
(III) has not engaged in
activities prohibited under
section 501(c)(3) of the
Internal Revenue Code of 1986;
(ii)(I) an 1890 institution (as
defined in section 2 of the
Agricultural Research, Extension, and
Education Reform Act of 1998 (7 U.S.C.
7601)), including West Virginia State
College;
(II) a 1994 institution (as
defined in section 2 of that
Act);
(III) an Indian tribal
community college;
(IV) an Alaska Native
cooperative college;
(V) a Hispanic-serving
institution (as defined in
section 1404 of the National
Agricultural Research,
Extension, and Teaching Policy
Act of 1977 (7 U.S.C. 3103));
and
(VI) any other institution of
higher education (as defined in
section 101 of the Higher
Education Act of 1965 (20
U.S.C. 1001)) that has
demonstrated experience in
providing agriculture education
or other agriculturally related
services to socially
disadvantaged farmers and
ranchers in a region; and
(iii) an Indian tribe (as defined in
section 4 of the Indian Self-
Determination and Education Assistance
Act (25 U.S.C. 450b)) or a national
tribal organization that has
demonstrated experience in providing
agriculture education or other
agriculturally related services to
socially disadvantaged farmers and
ranchers in a region.
(C) Secretary.--The term ``Secretary'' means
the Secretary of Agriculture.
(2) Program.--The Secretary shall carry out an
outreach and technical assistance program to encourage
and assist socially disadvantaged farmers and
ranchers--
(A) in owning and operating farms and
ranches; and
(B) in participating equitably in the full
range of agricultural programs offered by the
Department.
(3) Requirements.--The outreach and technical
assistance program under paragraph (2) shall--
(A) enhance coordination of the outreach,
technical assistance, and education efforts
authorized under various agriculture programs;
and
(B) include information on, and assistance
with--
(i) commodity, conservation, credit,
rural, and business development
programs;
(ii) application and bidding
procedures;
(iii) farm and risk management;
(iv) marketing; and
(v) other activities essential to
participation in agricultural and other
programs of the Department.
(4) Grants and contracts.--
(A) In general.--The Secretary may make
grants to, and enter into contracts and other
agreements with, an eligible entity to provide
information and technical assistance under this
subsection.
(B) Relationship to other law.--The authority
to carry out this section shall be in addition
to any other authority provided in this or any
other Act.
(5) Funding.--
(A) Authorization of appropriations.--There
is authorized to be appropriated to carry out
this subsection $25,000,000 for each of fiscal
years 2002 through 2006.
(B) Interagency funding.--In addition to
funds authorized to be appropriated under
subparagraph (A), any agency of the Department
may participate in any grant, contract, or
agreement entered into under this section by
contributing funds, if the agency determined
that the objectives of the grant, contract, or
agreement will further the authorized programs
of the contributing agency.
(b) Designation of Federal Personnel.--
* * * * * * *
SEC. 2506. PSEUDORABIES ERADICATION.
(a) Findings.--Congress finds that efforts to eradicate
pseudorabies in United States swine populations by the
Department of Agriculture in cooperation with State agencies
and the pork industry have a high priority and should be
continued until pseudorabies is completely eradicated in the
United States.
(b) Establishment of Program.--The Secretary of Agriculture
shall establish and carry out a program for the eradication of
pseudorabies in United States swine populations.
(c) Use of Funds for Testing and Control of Pseudorabies.--
The Secretary shall ensure that not less than 65 percent of the
funds appropriated for the program established under subsection
(b) shall be used for testing and screening of animals and for
other purposes directly related to the eradication or control
of pseudorabies. This requirement on the use of appropriated
funds for this program shall not be implemented in a manner
that would adversely affect any other animal or plant disease
or pest eradication or control program.
(d) Authorization of Appropriations.--There are authorized
to be appropriated for each of the fiscal years 1991 through
[2002] 2006 such sums as may be necessary for the purpose of
carrying out the program established under subsection (b).
* * * * * * *
AGRICULTURAL MARKET TRANSITION ACT
* * * * * * *
SEC. 194. ESTABLISHMENT OF OFFICE OF RISK MANAGEMENT.
[(a) Establishment.--
[(b) Fiscal Year 1996 Funding.--From funds appropriated for
the salaries and expenses of the Consolidated Farm Service
Agency in the Agriculture, Rural Development, Food and Drug
Administration, and Related Agencies Appropriations Act, 1996
(Public Law 104-37), the Secretary of Agriculture may use such
sums as necessary for the salaries and expenses of the Office
of Risk Management established under subsection (a).
[(c) Conforming Amendment.--]
SEC. 194. TREE ASSISTANCE PROGRAM.
(a) Definitions.--In this section:
(1) Eligible orchardist.--The term ``eligible
orchardist'' means a person that produces annual crops
from trees for commercial purposes,
(2) Natural disaster.--The term ``natural disaster''
means plant disease, insect infestation, drought, fire,
freeze, flood, earthquake, and other natural
occurrences, as determined by the Secretary.
(3) Tree.--The term ``tree'' includes trees, bushes,
and vines.
(4) Secretary.--The term ``Secretary'' means the
Secretary of Agriculture.
(b) Eligibility.--
(1) Loss.--Subject to paragraph (2), the Secretary
shall provide assistance in accordance with subsection
(c) to eligible orchardists that, as determined by the
Secretary--
(A) planted trees for commercial purposes;
and
(B) lost those trees as a result of a natural
disaster.
(2) Limitation.--An eligible orchardist shall qualify
for assistance under subsection (c) only if the tree
mortality rate of the orchardist, as a result of the
natural disaster, exceeds 15 percent (adjusted for
normal mortality), as determined by the Secretary.
(c) Assistance.--
(1) In general.--Assistance provided by the Secretary
to eligible orchardists for losses described in
subsection (b) shall consist of--
(A) reimbursement of 75 percent of the cost
of replanting trees lost due to a natural
disaster, as determined by the Secretary, in
excess of 15 percent mortality (adjusted for
normal mortality); or
(B) at the discretion of the Secretary,
sufficient tree seedlings to reestablish the
stand.
(2) Limitation on assistance.--
(A) Limitation.--The total amount of payments
that a person may receive under this section
shall not exceed--
(i) $100,000; or
(ii) an equivalent value in tree
seedlings.
(B) Regulations.--The Secretary shall
promulgate regulations that--
(i) define the term ``person'' for
the purposes of this section (which
definition shall conform, to the extent
practicable, to the regulations
defining the term `person' promulgated
under section 1001 of the Food Security
Act of 1985 (7 U.S.C. 1308); and
(ii) prescribe such rules as the
Secretary determines are necessary to
ensure a fair and reasonable
application of the limitation
established under this section.
(d) Authorization of Appropriations.--Notwithstanding
section 161, there is authorized to be appropriated such sums
as are necessary to carry out this section for each of fiscal
years 2002 through 2006.
* * * * * * *
Sec. 473a. Cotton classification services; fees for costs of services,
adjustments, and announcement; sales of samples;
disposition of moneys
Effective for each of fiscal years 1992 through [2002]
2006, the Secretary of Agriculture shall make cotton
classification services available to producers of cotton and
shall provide for the collection of classification fees from
participating producers, or agents who voluntarily agree to
collect and remit the fees on behalf of producers. Such fees,
together with the proceeds from the sales of samples submitted
under this section, shall cover as nearly as practicable the
cost of the services provided under this section, including
administrative and supervisory costs: Provided, That (1) the
uniform per bale classification fee to be collected from
producers, or their agents, for the classification service in
any year shall be the fee established in the previous year for
the prevailing method of classification service, exclusive of
adjustments to the fee made in the previous year under clauses
(2), (3), and (4), and as may be adjusted by the percentage
change in the implicit price deflator for the gross national
product as indexed during the most recent 12-month period for
which statistics are available; (2) the fee calculated in
accordance with clause (1) for
* * * * * * *
Sec. 1631. Protection for purchasers of farm products
(a) Congressional Findings.--Congress finds that--
* * * * * * *
(c) Definitions.--For the purposes of this section--
* * * * * * *
(4) The term ``effective financing statement'' means
a statement that--
(A) is an original or reproduced copy of the
statement, or, in the case of a State which
(under the applicable State law provisions of
the Uniform Commercial Code) allows the
electronic filing of financing statements
without the signature of the debtor, is an
electronically reproduced copy of the
statement;
(B) other than in the case of an
electronically reproduced copy of the
statement, is [signed] signed, authorized, or
otherwise authenticated by the debtor, and
filed with the Secretary of State of a State by
the secured party;
[(C) other than in the case of an
electronically reproduced copy of the
statement, is signed by the debtor;]
* * * * * * *
[(D)] (C) contains--
(i) the name and address of the
secured party;
(ii) the name and address of the
person indebted to the secured party;
(iii) the social security number of
the debtor or, in the case of a debtor
doing business other than as an
individual, the Internal Revenue
Service taxpayer identification number
of such debtor; and
(iv) a description of the farm
products subject to the security
interest created by the debtor,
including the amount of such products
where [applicable; and a reasonable
description of the property, including
3 county or parish in which
the property is located;] applicable,
and the name of each county or parish
in which the farm products are growing
or located;
[(E)](D) must be amended in writing, within 3
months, similarly signed and filed, to reflect
material changes;
[(F)](E) remains effective for a period of 5
years from the date of filing, subject to
extensions for additional periods of 5 years
each by refiling or filing a continuation
statement within 6 months before the expiration
of the initial 5 year period;
[(G)](F) lapses on either the expiration of
the effective period of the statement or the
filing of a notice signed by the secured party
that the statement has lapsed, whichever occurs
first;
[(H)](G) is accompanied by the requisite
filing fee set by the Secretary of State; and
[(I)](H) substantially complies with the
requirements of this subparagraph even though
it contains minor errors that are not seriously
misleading.
* * * * * * *
(e) Purchases Subject to Security Interest.--A buyer of
farm products takes subject to a security interest created by
the seller if--
(1)(A) within 1 year before the sale of the farm
products, the buyer has received from the secured party
or the seller written notice of the security interest
organized according to farm products that--
(i) is an original or reproduced copy
thereof;
(ii) contains--
(I) the name and address of the
secured party;
(II) the name and address of the
person indebted to the secured party;
(III) the social security number of
the debtor or, in the case of a debtor
doing business other than as an
individual, the Internal Revenue
Service taxpayer identification number
of such debtor; and
(IV) a description of the farm
products subject to the security
interest created by the debtor,
including the amount of such products
where applicable, [crop year, county or
parish, and a reasonable description of
the property; and] crop year, and the
name of each county or parish in which
the farm products are growing or
located;
* * * * * * *
(V) contains any payment obligations
imposed on the buyer by the secured
party as conditions for waiver or
release of the security interest; and
* * * * * * *
(3) in the case of a farm product produced in a State
that has established a central filing system, the
buyer--
(A) receives from the Secretary of State of
such State written notice is provided in
[subparagraph] subsection (c)(2)(E) or
(c)(2)(F) that specifies both the seller and
the farm product being sold by such seller as
being subject to an effective financing
statement or notice; and
(B) does not secure a waiver or release of
the security interest specified in such
effective financing statement or notice from
the secured party by performing any payment
obligation or otherwise; [and]
* * * * * * *
secured party or the seller written notice of
the security interest; organized according to
farm products, that--
(i) is an original or reproduced copy
thereof;
(ii) contains--
(I) the name and address of
the secured party;
(II) the name and address of
the person indebted to the
secured party;
(III) the social security
number of the debtor or, in the
case of a debtor doing business
other than as an individual,
the Internal Revenue Service
taxpayer identification number
of such debtor; and
(IV) a description of the
farm products subject to the
security interest created by
the debtor, including the
amount of such products, where
applicable, [crop year, county
or parish, and a reasonable
description of the property,
etc.; and] crop year, and the
name of each county or parish
in which the farm products are
growing or located;
(iii) must be amended in writing,
within 3 months, similarly signed and
transmitted, to reflect material
changes;
(iv) will lapse on either the
expiration period of the statement or
the transmission of a notice signed by
the secured party that the statement
has lapsed, whichever occurs first; and
(v) contains any payment obligations
imposed on the commission merchant or
selling agent by the secured party as
conditions for waiver or release of the
security interest; and
* * * * * * *
SEC 1027. PUBLIC DISCLOSURE REQUIREMENTS FOR COUNTY COMMITTEE
ELECTIONS.
Sec. 590h. Payments and grants of aid
(a) Repealed.
(b) Conservation and Environmental Assistance.--
(1) Environmental quality incentives program.--The
Secretary shall provide technical assistance, cost-
share payments, and incentive payments to operators
through the environmental quality incentives program in
accordance with part IV of subchapter IV of chapter 58
of this title.
(2) to (4) Repealed.
(5) State, county, and area committees.--
(A) Appointment of state committees.--The
Secretary shall appoint in each State a State
committee composed of not fewer than 3 nor more
than 5 members who are fairly representative of
the farmers in the State. The members of a
State committee shall serve at the pleasure of
the Secretary for such term as the Secretary
may establish.
[(B) Establishment of county, area, or local
committees.--
[(i) In each county or area in which
activities are carried out under this
section, the Secretary shall establish
a county or area committee.
[(ii) Any such committee shall
consist of not fewer than 3 nor more
than 5 members who are fairly
representative of the agricultural
producers in the county or area and who
shall be elected by the agricultural
producers in such county or area under
such procedures as the Secretary may
prescribe.
[(iii) The Secretary may designate
local administrative areas within the
county or larger area covered by a
committee established under clause (i).
Only agricultural producers within a
local administrative area who
participate or cooperate in programs
administered within their area shall be
eligible for nomination and election to
the local committee for that area,
under such regulations as the Secretary
may prescribe.
[(iv) The Secretary shall solicit and
accept nominations from organizations
representing the interests of socially
disadvantaged groups (as defined in
section 355(e)(1) of the Consolidated
Farm and Rural Development Act (7
U.S.C. 2003(e)(1)).
[(v) Members of each county, area, or
local committee shall serve for terms
not to exceed 3 years.
(B) Establishment and elections for county,
area, or local committees.--
(i) Establishment.--
(I) In general.--In each
country or area in which
activities are carried out
under this section, the
Secretary shall establish a
county or area committee.
(II) Local administrative
areas.--The Secretary may
designate local administrative
areas within a county or a
larger area under the
jurisdiction of a committee
established under subclause
(I).
(ii) Composition of county, area, or
local committees.--A committee
established under clause (i) shall
consist of not fewer than 3 nor more
than 5 members that--
(I) are fairly representative
of the agricultural producers
within the area covered by the
county, area, or local
committee; and
(II) are elected by the
agricultural producers that
participate or cooperate in
programs administered within
the area under the jurisdiction
of the county, area, or local
committee.
(iii) Elections.--
(I) In general.--Subject to
subclauses (II) through (V),
the Secretary shall establish
procedures for nominations and
elections to county, area, or
local committees.
(II) Nondiscrimination
statement.--Each solicitation
of nominations for, and notice
of elections of, a county,
area, or local committee shall
include the nondiscrimination
statement used by the
Secretary.
(III) Nominations.--
(aa) Eligibility.--To
be eligible for
nomination and election
to the applicable
county, area, or local
committee, as
determined by the
Secretary, an
agricultural producer
shall be located within
the area under the
jurisdiction of a
county, area, or local
committee, and
participate or
cooperate in programs
administered within
that area.
(bb) Outreach.--In
addition to such
nominating procedures
as the Secretary may
prescribe, the
Secretary shall solicit
and accept nominations
from organizations
representing the interests
of socially disadvantaged
groups (as defined in section
355(e)(1) of the Consolidated
Farm and Rural Development Act
(7 U.S.C. 2003(e)(1)).
(IV) Opening of ballots.--
(aa) Public notice.--
At least 10 days before
the date on which
ballots are to be
opened and counted, a
county, area, or local
committee shall
announce the date,
time, and place at
which election ballots
will be opened and
counted.
(bb) Opening of
ballots.--Election
ballots shall not be
opened until the date
and time announced
under item (aa).
(cc) Observation.--
Any person may observe
the opening and
counting of the
election ballots.
(V) Report of election.--Not
later than 20 days after the
date on which an election is
held, a county, area, or local
committee shall file an
election report with the
Secretary and the State office
of the Farm Service Agency that
includes--
(aa) the number of
eligible voters in the
area covered by the
county, area, or local
committee;
(bb) the number of
ballots cast in the
election by eligible
voters (including the
percentage of eligible
voters that cast
ballots);
(cc) the number of
ballots disqualified in
the election;
(dd) the percentage
that the number of
ballots disqualified is
of the number of
ballots received;
(ee) the number of
nominees for each seat
up for election;
(ff) the race,
ethnicity, and gender
of each nominee, as
provided through the
voluntary self-
identification of each
nominee; and
(gg) the final
election results
(including the number
of ballots received by
each nominee).
(VI) National report.--Not
later than 90 days after the
date on which the first
election of a county, area, or
local committee that occurs
after the date of enactment of
the Agriculture, Conservation,
and Rural Enhancement Act of
2001 is held, the Secretary
shall complete a report that
consolidates all the election
data reported to the Secretary
under subclause (V).
(VII) Election reform.--
(aa) Analysis.--If
determined necessary by
the Secretary after
analyzing the data
contained in the report
under subclause (VI),
the Secretary shall
promulgate and publish
in the Federal Register
proposed uniform
guidelines for
conducting elections
for members and
alternate members of
county, area, and local
committees not later
than 1 year after the
date of completion of
the report.
(bb) Inclusion.--The
procedures promulgated
by the Secretary under
item (aa) shall ensure
fair representation of
socially disadvantaged
groups described in
subclause (III)(bb) in
an area covered by the
county, area, or local
committee, in cases in
which those groups are
underrepresented on the
county, area, or local
committee for that
area.
(cc) Methods of
inclusion.--
Notwithstanding clause
(ii), the Secretary may
ensure inclusion of
socially disadvantaged
farmers and ranchers
through provisions
allowing for
appointment of
additional voting
members to a county,
area, or local
committee or through
other methods.
(iv) Term of office.--The term of
office for a member of a county, area,
or local committee shall not exceed 3
years.
* * * * * * *