[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2854 Reported in House (RH)]
Union Calendar No. 223
104th CONGRESS
2d Session
H. R. 2854
[Report No. 104-462, Parts I and II]
_______________________________________________________________________
A BILL
To modify the operation of certain agricultural programs.
_______________________________________________________________________
February 9, 1996
Reported from the Committee on Agriculture with an amendment
February 9, 1996
Referral to the Committee on Ways and Means extended for a period
ending not later than February 9, 1996
February 9, 1996
Committee on Ways and Means discharged; committed to the Committee of
the Whole House on the State of the Union and ordered to be printed
Union Calendar No. 223
104th CONGRESS
2d Session
H. R. 2854
[Report No. 104-462, Parts I and II]
To modify the operation of certain agricultural programs.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
January 5, 1996
Mr. Roberts (for himself, Mr. Emerson, Mr. Allard, Mr. Barrett of
Nebraska, Mr. Ewing, Mr. Combest, Mr. Boehner, Mr. Chambliss, and Mr.
Nethercutt) introduced the following bill; which was referred to the
Committee on Agriculture, and in addition to the Committee on Ways and
Means, for a period to be subsequently determined by the Speaker, in
each case for consideration of such provisions as fall within the
jurisdiction of the committee concerned
February 9, 1996
Additional sponsors: Mr. Tiahrt, Mr. Everett, Mr. Lewis of Kentucky,
Mr. Smith of Michigan, Mr. Chrysler, Mr. Ehlers, and Mr. Gunderson
February 9, 1996
Reported from the Committee on Agriculture with an amendment
[Strike out all after the enacting clause and insert the part printed
in italic]
February 9, 1996
Referral to the Committee on Ways and Means extended for a period
ending not later than February 9, 1996
February 9, 1996
Committee on Ways and Means discharged; committed to the Committee of
the Whole House on the State of the Union and ordered to be printed
[For text of introduced bill, see copy of bill as introduced on January
5, 1996]
_______________________________________________________________________
A BILL
To modify the operation of certain agricultural programs.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Agricultural
Market Transition Act''.
(b) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--AGRICULTURAL MARKET TRANSITION PROGRAM
Sec. 101. Purpose.
Sec. 102. Definitions.
Sec. 103. Production flexibility contracts.
Sec. 104. Nonrecourse marketing assistance loans and loan deficiency
payments.
Sec. 105. Payment limitations.
Sec. 106. Peanut program.
Sec. 107. Sugar program.
Sec. 108. Administration.
Sec. 109. Elimination of permanent price support authority.
Sec. 110. Effect of amendments.
TITLE II--DAIRY
Subtitle A--Milk Price Support and Other Activities
Sec. 201. Milk price support program.
Sec. 202. Recourse loans for commercial processors of dairy products.
Sec. 203. Dairy export incentive program.
Sec. 204. Dairy promotion program.
Sec. 205. Fluid milk standards under milk marketing orders.
Sec. 206. Manufacturing allowance.
Sec. 207. Establishment of temporary Class I price and temporary Class
I equalization pools.
Sec. 208. Establishment of temporary Class IV price and temporary Class
IV equalization pool.
Sec. 209. Authority for establishment of standby pools.
Subtitle B--Reform of Federal Milk Marketing Orders
Sec. 221. Issuance or amendment of Federal milk marketing orders to
implement certain reforms.
Sec. 222. Reform process.
Sec. 223. Effect of failure to comply with reform process requirements.
TITLE III--CONSERVATION
Sec. 301. Conservation.
TITLE IV--AGRICULTURAL PROMOTION AND EXPORT PROGRAMS
Sec. 401. Market promotion program.
Sec. 402. Export enhancement program.
TITLE V--MISCELLANEOUS
Sec. 501. Crop insurance.
Sec. 502. Collection and use of agricultural quarantine and inspection
fees.
Sec. 503. Commodity Credit Corporation interest rate.
Sec. 504. Establishment of Office of Risk Management.
Sec. 505. Business Interruption Insurance Program.
Sec. 506. Continuation of options pilot program.
TITLE VI--COMMISSION ON 21ST CENTURY PRODUCTION AGRICULTURE
Sec. 601. Establishment.
Sec. 602. Composition.
Sec. 603. Comprehensive review of past and future of production
agriculture.
Sec. 604. Reports.
Sec. 605. Powers.
Sec. 606. Commission procedures.
Sec. 607. Personnel matters.
Sec. 608. Termination of Commission.
TITLE VII--EXTENSION OF CERTAIN AUTHORITIES
Sec. 701. Extension of authority under Public Law 480.
Sec. 702. Extension of food for progress program.
TITLE I--AGRICULTURAL MARKET TRANSITION PROGRAM
SEC. 101. PURPOSE.
It is the purpose of this title--
(1) to authorize the use of binding production flexibility
contracts between the United States and agricultural producers
to support farming certainty and flexibility while ensuring
continued compliance with farm conservation compliance plans
and wetland protection requirements;
(2) to make nonrecourse marketing assistance loans and loan
deficiency available for certain crops;
(3) to improve the operation of farm programs for peanuts
and sugar; and
(4) to terminate price support authority under the
Agricultural Act of 1949.
SEC. 102. DEFINITIONS.
In this title:
(1) 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.) (as in effect
prior to the amendment made by section 109(b)(2)).
(2) Contract.--The term ``contract'' means a production
flexibility contract entered into under section 103.
(3) 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 (as
in effect prior to the amendment made by section 109(b)(2))
that would have been in effect for the 1996 crop (but for the
amendment made by section 109(b)(2)).
(4) Contract commodity.--The term ``contract commodity''
means wheat, corn, grain sorghum, barley, oats, upland cotton,
and rice.
(5) Contract payment.--The term ``contract payment'' means
a payment made under section 103 pursuant to a contract.
(6) Corn.--The term ``corn'' means field corn.
(7) Department.--The term ``Department'' means the United
States Department of Agriculture.
(8) 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
title V of the Agricultural Act of 1949 (as in effect prior to
the amendment made by section 109(b)(2)).
(9) Loan commodity.--The term ``loan commodity'' means each
contract commodity, extra long staple cotton, and oilseeds.
(10) 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.
(11) Person.--The term ``person'' means an individual,
partnership, firm, joint-stock company, corporation,
association, trust, estate, or State agency.
(12) Producer.--
(A) In general.--The term ``producer'' means a
person who, as owner, landlord, tenant, or
sharecropper, shares in the risk of producing a crop,
and 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.--The term ``producer'' includes a
person growing hybrid seed under contract. In
determining the interest of a grower of hybrid seed in
a crop, the Secretary shall not take into consideration
the existence of a hybrid seed contract.
(13) Program.--The term ``program'' means the agricultural
market transition program established under this title.
(14) Secretary.--The term ``Secretary'' means the Secretary
of Agriculture.
(15) 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.
(16) United states.--The term ``United States'', when used
in a geographical sense, means all of the States.
SEC. 103. PRODUCTION FLEXIBILITY CONTRACTS.
(a) Contracts Authorized.--
(1) Offer and terms.--Beginning as soon as practicable
after the date of the enactment of this title, the Secretary
shall offer to enter into a contract with an eligible owner or
operator described in paragraph (2) on a farm containing
eligible farmland. Under the terms of a contract, the owner or
operator shall agree, in exchange for annual contract payments,
to comply with--
(A) the conservation plan for the farm prepared in
accordance with section 1212 of the Food Security Act
of 1985 (16 U.S.C. 3812);
(B) wetland protection requirements applicable to
the farm under subtitle C of title XII of the Act (16
U.S.C. 3821 et seq.); and
(C) the planting flexibility requirements of
subsection (j).
(2) Eligible owners and operators described.--The following
persons shall be considered to be an owner or operator eligible
to enter into a contract:
(A) An owner of eligible farmland who assumes all
of the risk of producing a crop.
(B) An owner of eligible farmland who shares in the
risk of producing a crop.
(C) An operator of eligible farmland with a share-
rent lease of the eligible farmland, regardless of the
length of the lease, if the owner enters into the same
contract.
(D) An operator of eligible farmland who cash rents
the eligible farmland under a lease expiring on or
after September 30, 2002, in which case the consent of
the owner is not required.
(E) An operator of eligible farmland who cash rents
the eligible farmland under a lease expiring before
September 30, 2002, if the owner consents to the
contract.
(F) An owner of eligible farmland who cash rents
the eligible farmland and the lease term expires before
September 30, 2002, but only if the actual operator of
the farm declines to enter into a contract. In the case
of an owner covered by this subparagraph, contract
payments shall not begin under a contract until the
fiscal year following the fiscal year in which the
lease held by the nonparticipating operator expires.
(G) An owner or operator described in any preceding
subparagraph of this paragraph regardless of whether
the owner or operator purchased catastrophic risk
protection for a fall-planted 1996 crop under section
508(b) of the Federal Crop Insurance Act (7 U.S.C.
1508(b)).
(3) Tenants and sharecroppers.--In carrying out this
section, the Secretary shall provide adequate safeguards to
protect the interests of operators who are tenants and
sharecroppers.
(b) Elements.--
(1) Time for contracting.--
(A) Deadline.--Except as provided in subparagraph
(B), the Secretary may not enter into a contract after
April 15, 1996.
(B) Conservation reserve lands.--
(i) In general.--At the beginning of each
fiscal year, the Secretary shall allow an
eligible owner or operator 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 subparagraph (A) 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.
(ii) Amount.--Contract payments made for
contract acreage under this subparagraph shall
be made at the rate and amount applicable to
the annual contract payment level for the
applicable crop.
(2) Duration of contract.--
(A) Beginning date.--A contract shall begin with--
(i) the 1996 crop of a contract commodity;
or
(ii) in the case of acreage that was
subject to a conservation reserve contract
described in paragraph (1)(B), the date the
production flexibility contract was entered
into or expanded to cover the acreage.
(B) Ending date.--A contract shall extend through
the 2002 crop.
(3) 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.
(c) Eligible Farmland Described.--Land shall be considered to be
farmland 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 (as in effect prior to the amendment made by section
109(b)(2)) 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 subsection
(b)(1)(A).
(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.
(2) Advance payments.--
(A) Fiscal year 1996.--At the option of the owner
or operator, 50 percent of the contract payment for
fiscal year 1996 shall be made not later than June 15,
1996.
(B) Subsequent fiscal years.--At the option of the
owner or operator for fiscal year 1997 and each
subsequent fiscal year, 50 percent of the annual
contract payment shall be made on December 15.
(e) Amounts Available for Contract Payments for Each Fiscal Year.--
(1) In general.--The Secretary shall, to the maximum extent
practicable, expend on a fiscal year basis the following
amounts to satisfy the obligations of the Secretary under all
contracts:
(A) For fiscal year 1996, $5,570,000,000.
(B) For fiscal year 1997, $5,385,000,000.
(C) For fiscal year 1998, $5,800,000,000.
(D) For fiscal year 1999, $5,603,000,000.
(E) For fiscal year 2000, $5,130,000,000.
(F) For fiscal year 2001, $4,130,000,000.
(G) For fiscal year 2002, $4,008,000,000.
(2) Allocation.--The amount made available for a fiscal
year under paragraph (1) shall be allocated as follows:
(A) For wheat, 26.26 percent.
(B) For corn, 46.22 percent.
(C) For grain sorghum, 5.11 percent.
(D) For barley, 2.16 percent.
(E) For oats, 0.15 percent.
(F) For upland cotton, 11.63 percent.
(G) For rice, 8.47 percent.
(3) Adjustment.--The Secretary shall adjust the amounts
allocated for each contract commodity under paragraph (2) for a
particular fiscal year by--
(A) adding an amount equal to the sum of all
repayments of deficiency payments received under
section 114(a)(2) of the Agricultural Act of 1949 (as
in effect prior to the amendment made by section
109(b)(2)) for the commodity;
(B) to the maximum extent practicable, adding an
amount equal to the sum of all contract payments
withheld by the Secretary, at the request of an owner
or operator subject to a contract, as an offset against
repayments of deficiency payments otherwise required
under section 114(a)(2) of the Act (as so in effect)
for the commodity;
(C) adding an amount equal to the sum of all
refunds of contract payments received during the
preceding fiscal year under subsection (h) of this
section for the commodity; and
(D) 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 (as
in effect prior to the amendment made by section
109(b)(2)) for the 1994 and 1995 crop years.
(4) Special adjustment to cover existing rice payment
requirements.--As soon as possible after the date of the
enactment of this Act, the Secretary shall determine the
amount, if any, necessary to satisfy remaining payment
requirements under section 101B of the Agricultural Act of 1949
(as in effect prior to the amendment made by section 109(b)(2))
for the 1994 and 1995 crops of rice. The total amount
determined under this paragraph shall be deducted, in equal
amounts each fiscal year, from the amount allocated for rice
under paragraph (2)(G) for fiscal years after the fiscal year
in which the final remaining payments are made for rice.
(f) Determination of Contract Payments.--
(1) 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--
(A) 85 percent of the contract acreage; and
(B) the farm program payment yield.
(2) Annual payment quantity of contract commodities.--The
payment quantity of each contract commodity covered by all
contracts for each fiscal year shall equal the sum of the
amounts calculated under paragraph (1) for each individual
contract.
(3) Annual payment rate.--The payment rate for a contract
commodity for each fiscal year shall be equal to--
(A) the amount made available under subsection (e)
for the contract commodity for the fiscal year; divided
by
(B) the amount determined under paragraph (2) for
the fiscal year.
(4) Annual payment amount.--The amount to be paid under a
contract in effect for each fiscal year with respect to a
contract commodity shall be equal to the product of--
(A) the payment quantity determined under paragraph
(1) with respect to the contract; and
(B) the payment rate in effect under paragraph (3).
(5) 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)
shall apply to contract payments under this subsection. The
owner or operator 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 paragraph.
(6) Sharing of contract payments.--The Secretary shall
provide for the sharing of contract payments among the owners
and operators subject to the contract on a fair and equitable
basis.
(g) Payment Limitation.--The total amount of contract payments made
to a person under a contract during any fiscal year may not exceed the
payment limitations established under sections 1001 through 1001C of
the Food Security Act of 1985 (7 U.S.C. 1308 through 1308-3).
(h) Effect of Violation.--
(1) Termination of contract.--Except as provided in
paragraph (2), if an owner or operator subject to a contract
violates the conservation plan for the farm containing eligible
farmland under the contract, wetland protection requirements
applicable to the farm, or the planting flexibility
requirements of subsection (j), the Secretary shall terminate
the contract with respect to the owner or operator on each farm
in which the owner or operator has an interest. On the
termination, the owner or operator shall forfeit all rights to
receive future contract payments on each farm in which the
owner or operator has an interest and shall refund to the
Secretary all contract payments received by the owner or
operator during the period of the violation, together with
interest on the contract payments as determined by the
Secretary.
(2) Refund or adjustment.--If the Secretary determines that
a violation does not warrant termination of the contract under
paragraph (1), the Secretary may require the owner or operator
subject to the contract--
(A) to refund to the Secretary that part of the
contract payments received by the owner or operator
during the period of the violation, together with
interest on the contract payments as determined by the
Secretary; or
(B) to accept a reduction in the amount of future
contract payments that is proportionate to the severity
of the violation, as determined by the Secretary.
(3) Foreclosure.--An owner or operator subject to a
contract may not be required to make repayments to the
Secretary of amounts received under the contract if the
contract acreage has been foreclosed on and the Secretary
determines that forgiving the repayments is appropriate in
order to provide fair and equitable treatment. This paragraph
shall not void the responsibilities of such an owner or
operator under the contract if the owner or operator continues
or resumes operation, or control, of the contract acreage. On
the resumption of operation or control over the contract
acreage by the owner or operator, the provisions of the
contract in effect on the date of the foreclosure shall apply.
(4) Review.--A determination of the Secretary under this
subsection shall be considered to be an adverse decision for
purposes of the availability of administrative review of the
determination.
(i) Transfer of Interest in Lands Subject to Contract.--
(1) Effect of transfer.--Except as provided in paragraph
(2), the transfer by an owner or operator subject to a contract
of the right and interest of the owner or operator in the
contract acreage shall result in the termination of the
contract with respect to the acreage, effective on the date of
the transfer, unless the transferee of the acreage agrees with
the Secretary to assume all obligations of the contract. At the
request of the transferee, the Secretary may modify the
contract if the modifications are consistent with the
objectives of this section as determined by the Secretary.
(2) Exception.--If an owner or operator who is entitled to
a contract payment dies, becomes incompetent, or is otherwise
unable to receive the contract payment, the Secretary shall
make the payment, in accordance with regulations prescribed by
the Secretary.
(j) Planting Flexibility.--
(1) Permitted crops.--Subject to paragraph (2), any
commodity or crop may be planted on contract acreage on a farm.
(2) Limitations.--
(A) Haying and grazing.--
(i) Time limitations.--Haying and grazing
on land exceeding 15 percent of the contract
acreage on a farm as provided in clause (iii)
shall be permitted, except during any
consecutive 5-month period between April 1 and
October 31 that is determined by the State
committee established under section 8(b) of the
Soil Conservation and Domestic Allotment Act (6
U.S.C. 590h(b)) for a State. In the case of a
natural disaster, the Secretary may permit
unlimited haying and grazing on the contract
acreage of a farm.
(ii) Contract commodities.--Contract
acreage planted to a contract commodity for
harvest may be hayed or grazed at any time
without limitation.
(iii) Haying and grazing limitation on
portion or contract acreage.--Unlimited haying
and grazing shall be permitted on not more than
15 percent of the contract acreage on a farm.
(B) Alfalfa.--Alfalfa may be grown on contract
acreage in excess of the acreage limitation in
subparagraph (A)(iii) and without regard to the time
limitation in subparagraph (A)(i), except that each
contract acre on a farm that is planted for harvest to
alfalfa in excess of 15 percent of the total contract
acreage on the farm shall be ineligible for contract
payments.
(C) Fruits and vegetables.--
(i) In general.--The planting for harvest
of fruits and vegetables shall be prohibited on
contract acreage, except in any region in which
there is a history of double-cropping, as
determined by the Secretary.
(ii) Unrestricted vegetables.--
Notwithstanding clause (i), lentils, mung
beans, and dry peas may be planted for harvest
without limitation on contract acreage.
SEC. 104. NONRECOURSE MARKETING ASSISTANCE LOANS AND LOAN DEFICIENCY
PAYMENTS.
(a) Availability of Marketing Assistance Loans.--
(1) Nonrecourse loans available.--For each of the 1996
through 2002 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 subsection (b) for the loan commodity.
(2) Eligible production.--The following production shall be
eligible for a marketing assistance loan under paragraph (1):
(A) In the case of a marketing assistance loan for
a contract commodity, any production by a producer who
has entered into a production flexibility contract.
(B) In the case of a marketing assistance loan for
extra long staple cotton and oilseeds, any production.
(3) Recourse loans for high moisture feed grains.--
(A) Recourse loans available.--For each of the 1996
through 2002 crops of corn and grain sorghum, the
Secretary shall make available recourse loans, as
determined by the Secretary, to producers on a farm
who--
(i) normally harvest all or a portion of
their crop of corn or grain sorghum in a high
moisture state;
(ii) present--
(I) certified scale tickets from an
inspected, certified commercial scale,
including licensed warehouses,
feedlots, feed mills, distilleries, or
other similar entities approved by the
Secretary, pursuant to regulations
issued by the Secretary; or
(II) present field or other
physical measurements of the standing
or stored crop in regions of the
country, as determined by the
Secretary, that do not have certified
commercial scales from which certified
scale tickets may be obtained within
reasonable proximity of harvest
operation;
(iii) certify that they were the owners of
the feed grain at the time of delivery to, and
that the quantity to be placed under loan under
this paragraph was in fact harvested on the
farm and delivered to, a feedlot, feed mill, or
commercial or on-farm high-moisture storage
facility, or to such facilities maintained by
the users of corn and grain sorghum in a high
moisture state; and
(iv) comply with deadlines established by
the Secretary for harvesting the corn or grain
sorghum and submit applications for loans under
this paragraph within deadlines established by
the Secretary.
(B) Eligibility of acquired feed grains.--Loans
under this paragraph shall be made on a quantity of
corn or grain sorghum of the same crop acquired by the
producer equivalent to a quantity determined by
multiplying--
(i) the acreage of the corn or grain
sorghum in a high moisture state harvested on
the producer's farm; by
(ii) the lower of the farm program payment
yield or the actual yield on a field, as
determined by the Secretary, that is similar to
the field from which the corn or grain sorghum
was obtained.
(C) High moisture state defined.--In this
paragraph, 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 paragraph
(1).
(b) Loan Rates.--
(1) Wheat.--
(A) Loan rate.--Subject to subparagraph (B), the
loan rate for a marketing assistance loan under
subsection (a)(1) for wheat shall be--
(i) 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
(ii) not more than $2.58 per bushel.
(B) 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--
(i) 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;
(ii) 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
(iii) less than 15 percent, the Secretary
may not reduce the loan rate for wheat for the
corresponding crop.
(C) No effect on future years.--Any reduction in
the loan rate for wheat under subparagraph (B) shall
not be considered in determining the loan rate for
wheat for subsequent years.
(2) Feed grains.--
(A) Loan rate for corn.--Subject to subparagraph
(B), the loan rate for a marketing assistance loan
under subsection (a)(1) for corn shall be--
(i) 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
(ii) not more than $1.89 per bushel.
(B) 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--
(i) 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;
(ii) 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
(iii) less than 12.5 percent the Secretary
may not reduce the loan rate for corn for the
corresponding crop.
(C) No effect on future years.--Any reduction in
the loan rate for corn under subparagraph (B) shall not
be considered in determining the loan rate for corn for
subsequent years.
(D) Other feed grains.--The loan rate for a
marketing assistance loan under subsection (a)(1) 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.
(3) Upland cotton.--
(A) Loan rate.--Subject to subparagraph (B), the
loan rate for a marketing assistance loan under
subsection (a)(1) 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--
(i) 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 in the year in
which the loan rate is announced, 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
(ii) 90 percent of the average, for the 15-
week period beginning July 1 of the year in
which the loan rate is announced, of the 5
lowest-priced growths of the growths quoted for
Middling 1\3/32\-inch cotton C.I.F. Northern
Europe (adjusted downward by the average
difference during the period April 15 through
October 15 of the year in which the loan is
announced 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.
(B) 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.
(4) Extra long staple cotton.--The loan rate for a
marketing assistance loan under subsection (a)(1) for extra
long staple cotton shall be--
(A) 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 previous marketing years, 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 $0.7965 per pound.
(5) Rice.--The loan rate for a marketing assistance loan
under subsection (a)(1) for rice shall be $6.50 per
hundredweight.
(6) Oilseeds.--
(A) Soybeans.--The loan rate for a marketing
assistance loan under subsection (a)(1) for soybeans
shall be $4.92 per bushel.
(B) Sunflower seed, canola, rapeseed, safflower,
mustard seed, and flaxseed.--The loan rates for a
marketing assistance loan under subsection (a)(1) for
sunflower seed, canola, rapeseed, safflower, mustard
seed, and flaxseed, individually, shall be $0.087 per
pound.
(C) Other oilseeds.--The loan rates for a marketing
assistance loan under subsection (a)(1) 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.
(c) Term of Loan.--In the case of each loan commodity (other than
upland cotton or extra long staple cotton), a marketing assistance loan
under subsection (a)(1) 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.
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
first month after the month in which the loan is made. The Secretary
may not extend the term of a marketing assistance loan for any loan
commodity.
(d) Repayment.--
(1) Repayment rates generally.--The Secretary shall permit
producers to repay a marketing assistance loan under subsection
(a)(1) for a loan commodity (other than extra long staple
cotton) at a level that is the lesser of--
(A) the loan rate established for the commodity
under subsection (b); or
(B) the prevailing world market price for the
commodity (adjusted to United States quality and
location), as determined by the Secretary.
(2) Additional repayment rates for wheat, feed grains, and
oilseeds.--In the case of a marketing assistance loan under
subsection (a)(1) for wheat, corn, grain sorghum, barley, oats,
or oilseeds, the Secretary shall also permit a producer to
repay the loan at such level as 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.
(3) Repayment rates for extra long staple cotton.--
Repayment of a marketing assistance loan for extra long staple
cotton shall be at the loan rate established for the commodity
under subsection (b), plus interest (as determined by the
Secretary).
(4) Prevailing world market price.--For purposes of
paragraph (1) and subsection (f), the Secretary shall prescribe
by regulation--
(A) a formula to determine the prevailing world
market price for each loan commodity, adjusted to
United States quality and location; and
(B) a mechanism by which the Secretary shall
announce periodically the prevailing world market price
for each loan commodity.
(5) Adjustment of prevailing world market price for upland
cotton.--
(A) In general.--During the period ending July 31,
2003, the prevailing world market price for upland
cotton (adjusted to United States quality and location)
established under paragraph (4) shall be further
adjusted if--
(i) the adjusted prevailing world market
price is less than 115 percent of the loan rate
for upland cotton established under subsection
(b), as determined by the Secretary; and
(ii) the Friday through Thursday average
price quotation for the lowest-priced United
States growth as quoted for Middling (M) 1\3/
32\-inch cotton delivered C.I.F. Northern
Europe is greater than the Friday through
Thursday average price of the 5 lowest-priced
growths of upland cotton, as quoted for
Middling (M) 1\3/32\-inch cotton, delivered
C.I.F. Northern Europe (referred to in this
subsection as the ``Northern Europe price'').
(B) Further adjustment.--Except as provided in
subparagraph (C), the adjusted prevailing world market
price for upland cotton shall be further adjusted on
the basis of some or all of the following data, as
available:
(i) The United States share of world
exports.
(ii) The current level of cotton export
sales and cotton export shipments.
(iii) Other data determined by the
Secretary to be relevant in establishing an
accurate prevailing world market price for
upland cotton (adjusted to United States
quality and location).
(C) Limitation on further adjustment.--The
adjustment under subparagraph (B) may not exceed the
difference between--
(i) the Friday through Thursday average
price for the lowest-priced United States
growth as quoted for Middling 1\3/32\-inch
cotton delivered C.I.F. Northern Europe; and
(ii) the Northern Europe price.
(e) Loan Deficiency Payments.--
(1) Availability.--Except as provided in paragraph (4), the
Secretary may make loan deficiency payments available to
producers who, although eligible to obtain a marketing
assistance loan under subsection (a)(1) with respect to a loan
commodity, agree to forgo obtaining the loan for the commodity
in return for payments under this subsection.
(2) Computation.--A loan deficiency payment under this
subsection shall be computed by multiplying--
(A) the loan payment rate determined under
paragraph (3) for the loan commodity; by
(B) the quantity of the loan commodity that the
producers on a farm are eligible to place under loan
but for which the producers forgo obtaining the loan in
return for payments under this subsection.
(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)
for the loan commodity; exceeds
(B) the rate at which a loan for the commodity may
be repaid under subsection (d).
(4) Exception for extra long staple cotton.--This
subsection shall not apply with respect to extra long staple
cotton.
(f) Special Marketing Loan Provisions for Upland Cotton.--
(1) Cotton user marketing certificates.--
(A) Issuance.--Subject to subparagraph (D), during
the period ending July 31, 2003, the Secretary shall
issue marketing certificates or cash payments 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--
(i) the Friday through Thursday average
price quotation for the lowest-priced United
States growth, as quoted for Middling (M) 1\3/
32\-inch cotton, delivered C.I.F. Northern
Europe exceeds the Northern Europe price by
more than 1.25 cents per pound; and
(ii) the prevailing world market price for
upland cotton (adjusted to United States
quality and location) does not exceed 130
percent of the loan rate for upland cotton
established under subsection (b).
(B) Value of certificates or payments.--The value
of the marketing certificates or cash payments shall be
based on the amount of the difference (reduced by 1.25
cents per pound) in the prices during the 4th week of
the consecutive 4-week period multiplied by the
quantity of upland cotton included in the documented
sales.
(C) Redemption, marketing, or exchange.--The
Secretary shall establish procedures to assist persons
receiving marketing certificates under this paragraph
in the redemption of certificates for cash, or in the
marketing or exchange of certificates for agricultural
commodities owned by the Commodity Credit Corporation,
in such manner and at such price levels as the
Secretary determines will best effectuate the purposes
of the marketing certificates. Any price restrictions
that may otherwise apply to the disposition of
agricultural commodities by the Commodity Credit
Corporation shall not apply to the redemption of
certificates under this paragraph.
(D) Exception.--The Secretary shall not issue
marketing certificates or cash payments under
subparagraph (A) if, for the immediately preceding
consecutive 10-week period, the Friday through Thursday
average price quotation for the lowest priced United
States growth, as quoted for Middling (M) 1\3/32\-inch
cotton, delivered C.I.F. Northern Europe, adjusted for
the value of any certificate issued under this
paragraph, exceeds the Northern Europe price by more
than 1.25 cents per pound.
(E) Limitation on expenditures.--Total expenditures
under this paragraph shall not exceed $701,000,000
during fiscal years 1996 through 2002.
(2) Special import quota.--
(A) Establishment.--The President shall carry out
an import quota program that provides that, during the
period ending July 31, 2003, whenever the Secretary
determines and announces that for any consecutive 10-week period, the
Friday through Thursday average price quotation for the lowest-priced
United States growth, as quoted for Middling (M) 1\3/32\-inch cotton,
delivered C.I.F. Northern Europe, adjusted for the value of any
certificates issued under paragraph (1), exceeds the Northern Europe
price by more than 1.25 cents per pound, there shall immediately be in
effect a special import quota.
(B) Quantity.--The quota shall be equal to 1 week's
consumption of upland cotton by domestic mills at the
seasonally adjusted average rate of the most recent 3
months for which data are available.
(C) Application.--The quota shall apply to upland
cotton purchased not later than 90 days after the date
of the Secretary's announcement under subparagraph (A)
and entered into the United States not later than 180
days after the date.
(D) Overlap.--A special quota period may be
established that overlaps any existing quota period if
required by subparagraph (A), except that a special
quota period may not be established under this
paragraph if a quota period has been established under
subsection (g).
(E) Preferential tariff treatment.--The quantity
under a special import quota shall be considered to be
an in-quota quantity for purposes of--
(i) section 213(d) of the Caribbean Basin
Economic Recovery Act (19 U.S.C. 2703(d));
(ii) section 204 of the Andean Trade
Preference Act (19 U.S.C. 3203);
(iii) section 503(d) of the Trade Act of
1974 (19 U.S.C. 2463(d)); and
(iv) General Note 3(a)(iv) to the
Harmonized Tariff Schedule.
(F) Definition.--In this paragraph, the term
``special import quota'' means a quantity of imports
that is not subject to the over-quota tariff rate of a
tariff-rate quota.
(g) Limited Global Import Quota for Upland Cotton.--
(1) In general.--The President shall carry out an import
quota program that provides that whenever the Secretary
determines and announces that the average price of the base
quality of upland cotton, as determined by the Secretary, in
the designated spot markets for a month exceeded 130 percent of
the average price of such quality of cotton in the markets for
the preceding 36 months, notwithstanding any other provision of
law, there shall immediately be in effect a limited global
import quota subject to the following conditions:
(A) Quantity.--The quantity of the quota shall be
equal to 21 days of domestic mill consumption of upland
cotton at the seasonally adjusted average rate of the
most recent 3 months for which data are available.
(B) Quantity if prior quota.--If a quota has been
established under this subsection during the preceding
12 months, the quantity of the quota next established
under this subsection shall be the smaller of 21 days
of domestic mill consumption calculated under
subparagraph (A) or the quantity required to increase
the supply to 130 percent of the demand.
(C) Preferential tariff treatment.--The quantity
under a limited global import quota shall be considered
to be an in-quota quantity for purposes of--
(i) section 213(d) of the Caribbean Basin
Economic Recovery Act (19 U.S.C. 2703(d));
(ii) section 204 of the Andean Trade
Preference Act (19 U.S.C. 3203);
(iii) section 503(d) of the Trade Act of
1974 (19 U.S.C. 2463(d)); and
(iv) General Note 3(a)(iv) to the
Harmonized Tariff Schedule.
(D) Definitions.--In this subsection:
(i) Supply.--The term ``supply'' means,
using the latest official data of the Bureau of
the Census, the Department of Agriculture, and
the Department of the Treasury--
(I) the carry-over of upland cotton
at the beginning of the marketing year
(adjusted to 480-pound bales) in which
the quota is established;
(II) production of the current
crop; and
(III) imports to the latest date
available during the marketing year.
(ii) Demand.--The term ``demand'' means--
(I) the average seasonally adjusted
annual rate of domestic mill
consumption in the most recent 3 months
for which data are available; and
(II) the larger of--
(aa) average exports of
upland cotton during the
preceding 6 marketing years; or
(bb) cumulative exports of
upland cotton plus outstanding
export sales for the marketing
year in which the quota is
established.
(iii) Limited global import quota.--The
term ``limited global import quota'' means a
quantity of imports that is not subject to the
over-quota tariff rate of a tariff-rate quota.
(E) Quota entry period.--When a quota is
established under this subsection, cotton may be
entered under the quota during the 90-day period
beginning on the date the quota is established by the
Secretary.
(2) No overlap.--Notwithstanding paragraph (1), a quota
period may not be established that overlaps an existing quota
period or a special quota period established under subsection
(f)(2).
(h) Source of Loans.--
(1) In general.--The Secretary shall provide the loans
authorized by this section and the Agricultural Adjustment Act
of 1938 (7 U.S.C. 1281 et seq.) through the Commodity Credit
Corporation and other means available to the Secretary.
(2) Processors.--Whenever any loan or surplus removal
operation for any agricultural commodity is carried out through
purchases from or loans or payments to processors, the
Secretary shall, to the extent practicable, obtain from the
processors such assurances as the Secretary considers adequate
that the producers of the commodity have received or will
receive maximum benefits from the loan or surplus removal
operation.
(i) Adjustments of Loans.--
(1) In general.--The Secretary may make appropriate
adjustments in the loan levels for any commodity for
differences in grade, type, quality, location, and other
factors.
(2) Loan level.--The adjustments shall, to the maximum
extent practicable, be made in such manner that the average
loan level for the commodity will, on the basis of the
anticipated incidence of the factors, be equal to the level of
support determined as provided in this section or the
Agricultural Adjustment Act of 1938 (7 U.S.C. 1281 et seq.).
(j) Personal Liability of Producers for Deficiencies.--
(1) In general.--Except as provided in paragraph (2), no
producer shall be personally liable for any deficiency arising
from the sale of the collateral securing any nonrecourse loan
made under this section or the Agricultural Adjustment Act of
1938 (7 U.S.C. 1281 et seq.) unless the loan was obtained
through a fraudulent representation by the producer.
(2) Limitations.--Paragraph (1) shall not prevent the
Commodity Credit Corporation or the Secretary from requiring a
producer to assume liability for--
(A) a deficiency in the grade, quality, or quantity
of a commodity stored on a farm or delivered by the
producer;
(B) a failure to properly care for and preserve a
commodity; or
(C) a failure or refusal to deliver a commodity in
accordance with a program established under this
section or the Agricultural Adjustment Act of 1938.
(3) Acquisition of collateral.--The Secretary may include
in a contract for a nonrecourse loan made under this section or
the Agricultural Adjustment Act of 1938 a provision that
permits the Commodity Credit Corporation, on and after the
maturity of the loan, to acquire title to the unredeemed
collateral without obligation to pay for any market value that
the collateral may have in excess of the loan indebtedness.
(4) Sugarcane and sugar beets.--A security interest
obtained by the Commodity Credit Corporation as a result of the
execution of a security agreement by the processor of sugarcane
or sugar beets shall be superior to all statutory and common
law liens on raw cane sugar and refined beet sugar in favor of
the producers of sugarcane and sugar beets and all prior
recorded and unrecorded liens on the crops of sugarcane and
sugar beets from which the sugar was derived.
(k) Commodity Credit Corporation Sales Price Restrictions.--
(1) In general.--The Commodity Credit Corporation may sell
any commodity owned or controlled by the Corporation at any
price that the Secretary determines will maximize returns to the
Corporation.
(2) Nonapplication of sales price restrictions.--Paragraph
(1) shall not apply to--
(A) a sale for a new or byproduct use;
(B) a sale of peanuts or oilseeds for the
extraction of oil;
(C) a sale for seed or feed if the sale will not
substantially impair any loan program;
(D) a sale of a commodity that has substantially
deteriorated in quality or as to which there is a
danger of loss or waste through deterioration or
spoilage;
(E) a sale for the purpose of establishing a claim
arising out of a contract or against a person who has
committed fraud, misrepresentation, or other wrongful
act with respect to the commodity;
(F) a sale for export, as determined by the
Corporation; and
(G) a sale for other than a primary use.
(3) Presidential disaster areas.--
(A) In general.--Notwithstanding paragraph (1), on
such terms and conditions as the Secretary may consider
in the public interest, the Corporation may make
available any commodity or product owned or controlled
by the Corporation for use in relieving distress--
(i) in any area in the United States
(including the Virgin Islands) declared by the
President to be an acute distress area because
of unemployment or other economic cause, if the
President finds that the use will not displace
or interfere with normal marketing of
agricultural commodities; and
(ii) in connection with any major disaster
determined by the President to warrant
assistance by the Federal Government under the
Robert T. Stafford Disaster Relief and
Emergency Assistance Act (42 U.S.C. 5121 et
seq.).
(B) Costs.--Except on a reimbursable basis, the
Corporation shall not bear any costs in connection with
making a commodity available under subparagraph (A)
beyond the cost of the commodity to the Corporation
incurred in--
(i) the storage of the commodity; and
(ii) the handling and transportation costs
in making delivery of the commodity to
designated agencies at 1 or more central
locations in each State or other area.
(4) Efficient operations.--Paragraph (1) shall not apply to
the sale of a commodity the disposition of which is desirable
in the interest of the effective and efficient conduct of the
operations of the Corporation because of the small quantity of
the commodity involved, or because of the age, location, or
questionable continued storability of the commodity.
SEC. 105. PAYMENT LIMITATIONS.
(a) In General.--Section 1001 of the Food Security Act of 1985 (7
U.S.C. 1308) is amended by striking paragraphs (1) through (4) and
inserting the following:
``(1) Limitation on payments under production flexibility
contracts.--The total amount of contract payments made under
section 103 of the Agricultural Market Transition Act to a
person under 1 or more production flexibility contracts entered
into under the section during any fiscal year may not exceed
$40,000.
``(2) Limitation on marketing loan gains and loan
deficiency payments.--For each of the 1996 through 2002 crops
of loan commodities, the total amount of payments specified in
paragraph (3) that a person shall be entitled to receive under
section 104 of the Agricultural Market Transition Act for one
or more loan commodities 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 for a crop of any loan
commodity at a lower level than the original loan rate
established for the loan commodity under section 104(b)
of the Agricultural Market Transition Act.
``(B) Any loan deficiency payment received for a
loan commodity under section 104(e) of the Act.
``(4) Definitions.--In this title, the terms `contract
payment' and `loan commodity' have the meaning given those
terms in section 102 of the Agricultural Market Transition
Act.''.
(b) Conforming Amendments.--
(1) Section 1001A of the Food Security Act of 1985 (7
U.S.C. 1308-1) is amended--
(A) in subsection (a)(1), by striking ``under the
Agricultural Act of 1949 (7 U.S.C. 1421 et seq.)''; and
(B) in subsection (b)(1), by striking ``under the
Agricultural Act of 1949''.
(2) Section 1001C(a) of the Act (7 U.S.C. 1308-3(a)) is
amended--
(A) by striking ``For each of the 1991 through 1997
crops, any'' and inserting ``Any'';
(B) by striking ``production adjustment payments,
price support program loans, payments, or benefits made
available under the Agricultural Act of 1949 (7 U.S.C.
1421 et seq.),'' and inserting ``loans or payments made
available under title I of the Agricultural Market
Transition Act,''; and
(C) by striking ``during the 1989 through 1997 crop
years''.
SEC. 106. 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 411
of the Agricultural Adjustment Act of 1938.
(5) Offers from handlers.--In the case of any producer who
had an offer available from a handler to purchase quota
peanuts, for delivery within the same county or a contiguous
county, at a price equal to or greater than the applicable
quota support rate, the Secretary shall reduce the support rate
by 5 percent for the peanuts that were subject to the offer.
(b) Additional Peanuts.--
(1) In general.--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) 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. Bright hull and dark
hull Valencia peanuts shall be considered as separate
types for the purpose of establishing the pools.
(B) 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) Other 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 export edible use.
(3) Buy-back gains within area.--Further losses in an area
quota pool shall be offset by gains or profits attributable to
sales of additional peanuts in that area pursuant to the
provisions of section 358e(g)(1)(A) of the Agricultural
Adjustment Act of 1938 (7 U.S.C. 1359a(g)(1)(A)).
(4) 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
subsection 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. If losses in area quota pools
have not been entirely offset through use of the preceding
sentence, then further losses shall be offset by gains or
profits attributable to sales of additional peanuts in other
areas pursuant to section 358e(g)(1)(A) of such Act (7 U.S.C.
1359a(g)(1)(A)).
(6) 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 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 covered by that 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, \1/2\ 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 (f) shall be effective only for
the 1996 through 2002 crops of peanuts.
(i) Marketing Quotas.--
(1) In general.--Part VI of subtitle B of title III of the
Agricultural Adjustment Act of 1938 is amended--
(A) in section 358-1 (7 U.S.C. 1358-1)--
(i) in the section heading, by striking
``1991 through 1997 crops of'';
(ii) in subsections (a)(1), (b)(1)(B),
(b)(2)(A), (b)(2)(C), and (b)(3)(A), by
striking ``of the 1991 through 1997 marketing
years'' each place it appears and inserting
``marketing year'';
(iii) in subsection (a)(3), by striking
``1990'' and inserting ``1990, for the 1991
through 1995 marketing years, and 1995, for the
1996 through 2002 marketing years'';
(iv) in subsection (b)(1)(A)--
(I) by striking ``each of the 1991
through 1997 marketing years'' and
inserting ``each marketing year''; and
(II) in clause (i), by inserting
before the semicolon the following: ``,
in the case of the 1991 through 1995
marketing years, and the 1995 marketing
year, in the case of the 1996 through
2002 marketing years''; and
(v) in subsection (f), by striking ``1997''
and inserting ``2002'';
(B) in section 358b (7 U.S.C. 1358b)--
(i) in the section heading, by striking
``1991 through 1995 crops of''; and
(ii) in subsection (c), by striking
``1995'' and inserting ``2002'';
(C) in section 358c(d) (7 U.S.C. 1358c(d)), by
striking ``1995'' and inserting ``2002''; and
(D) in section 358e (7 U.S.C. 1359a)--
(i) in the section heading, by striking
``for 1991 through 1997 crops of peanuts''; and
(ii) in subsection (i), by striking
``1997'' and inserting ``2002''.
(2) Eligibility for farm poundage quota.--
(A) Certain farms ineligible.--Section 358-1(b)(1)
of the Act (7 U.S.C. 1358-1(b)(1)) is amended by adding
at the end the following:
``(D) Certain farms ineligible to hold quota.--
Effective beginning with the 1997 marketing year, the
Secretary shall no longer establish farm poundage
quotas under subparagraph (A) for farms--
``(i) owned or controlled by
municipalities, airport authorities, schools,
colleges, refuges, and other public entities
(not including universities for research
purposes); or
``(ii) owned or controlled by a person who
is not a producer and resides in another
State.''.
(B) Allocation of quota to other farms.--Section
358-1(b)(2) of the Act (7 U.S.C. 1358-1(b)(2)) is
amended by adding at the end the following:
``(E) Transfer of quota from ineligible farms.--Any
farm poundage quota held at the end of the 1996
marketing year by a farm described in paragraph (1)(D)
shall be allocated to other farms in the same State on
such basis as the Secretary may by regulation
prescribe.''.
(3) Elimination of quota floor.--Section 358-1(a)(1) of the
Act (7 U.S.C. 1358-1(a)(1)) is amended by striking the second
sentence.
(4) Temporary quota allocation.--Section 358-1 of the Act
(7 U.S.C. 1358-1) is amended--
(A) in subsection (a)(1), by striking ``domestic
edible, seed,'' and inserting ``domestic edible use'';
(B) in subsection (b)(2)--
(i) in subparagraph (A), by striking
``subparagraph (B) and subject to''; and
(ii) by striking subparagraph (B) and
inserting the following:
``(B) Temporary quota allocation.--
``(i) Allocation related to seed peanuts.--
Temporary allocation of quota pounds for the
marketing year only in which the crop is
planted shall be made to producers for each of
the 1996 through 2002 marketing years as
provided in this subparagraph.
``(ii) Quantity.--The temporary quota
allocation shall be equal to the pounds of seed
peanuts planted on the farm, as may be adjusted
under regulations prescribed by the Secretary.
``(iii) Additional quota.--The temporary
allocation of quota pounds under this paragraph
shall be in addition to the farm poundage quota
otherwise established under this subsection and
shall be credited, for the applicable marketing
year only, in total to the producer of the
peanuts on the farm in a manner prescribed by
the Secretary.
``(iv) Effect of other requirements.--
Nothing in this section alters or changes the
requirements regarding the use of quota and
additional peanuts established by section
358e(b).''; and
(C) in subsection (e)(3), strike ``and seed and use
on a farm''.
(5) Spring and fall transfers within a state.--Section
358b(a)(1) of the Act (7 U.S.C. 1358b(a)(1)) is amended--
(A) by striking ``, conditions, or limitations'' in
the matter preceding the subparagraphs and inserting
``and conditions'';
(B) by striking ``any such lease'' in the matter
preceding the subparagraphs and inserting ``any such
sale or lease''; and
(C) by striking ``in the fall or after the normal
planting season--'' and subparagraphs (A) and (B) and
inserting the following: ``in the spring (or before the
normal planting season) or in the fall (or after the
normal planting season) with the owner or operator of a
farm located within any county in the same State. In
the case of a fall transfer or a transfer after the
normal planting season, the transfer may be made only
if not less than 90 percent of the basic quota (the
farm quota exclusive of temporary quota transfers),
plus any poundage quota transferred to the farm under
this subsection, has been planted or considered planted
on the farm from which the quota is to be leased.''.
(6) Undermarketings.--Part VI of subtitle B of title III of
the Act is amended--
(A) in section 358-1(b) (7 U.S.C. 1358-1(b))--
(i) in paragraph (1)(B), by striking
``including--'' and clauses (i) and (ii) and
inserting ``including any increases resulting
from the allocation of quotas voluntarily
released for 1 year under paragraph (7).'';
(ii) in paragraph (3)(B), by striking
``include--'' and clauses (i) and (ii) and
inserting ``include any increase resulting from
the allocation of quotas voluntarily released
for 1 year under paragraph (7).''; and
(iii) by striking paragraphs (8) and (9);
and
(B) in section 358b(a) (7 U.S.C. 1358b(a))--
(i) in paragraph (1), by striking
``(including any applicable under marketings)''
both places it appears;
(ii) in paragraph (2), by striking
``(including any applicable under
marketings)''; and
(iii) in paragraph (3), by striking
``(including any applicable undermarketings)''.
(7) Disaster transfers.--Section 358-1(b) of the Act (7
U.S.C. 1358-1(b)), as amended by paragraph (6)(A)(iii), is
further amended by adding at the end the following:
``(8) Disaster transfers.--
``(A) In general.--Except as provided in
subparagraph (B), additional peanuts produced on a farm
from which the quota poundage was not harvested and
marketed because of drought, flood, or any other
natural disaster, or any other condition beyond the
control of the producer, may be transferred to the
quota loan pool for pricing purposes on such basis as
the Secretary shall by regulation provide.
``(B) Limitation.--The poundage of peanuts
transferred under subparagraph (A) shall not exceed the
difference between--
``(i) the total quantity of peanuts meeting
quality requirements for domestic edible use,
as determined by the Secretary, marketed from
the farm; and
``(ii) the total farm poundage quota,
excluding quota pounds transferred to the farm
in the fall.
``(C) Support rate.--Peanuts transferred under this
paragraph shall be supported at 70 percent of the quota
support rate for the marketing years in which the
transfers occur. The transfers for a farm shall not
exceed 25 percent of the total farm quota pounds,
excluding pounds transferred in the fall.''.
SEC. 107. 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.--
(1) Reduction required.--The Secretary shall 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
the European Union and other major sugar growing, producing,
and exporting countries in the aggregate exceed the commitments
made as part of the Agreement on Agriculture.
(2) Extent of reduction.--The Secretary shall not reduce
the loan rate under subsection (a) or (b) below a rate that
provides an equal measure of support to that provided by the
European Union and other major sugar growing, producing, and
exporting countries, based on an examination of both domestic
and export subsidies subject to reduction in the Agreement on
Agriculture.
(3) Announcement of reduction.--The Secretary shall
announce any loan rate reduction to be made under this
subsection as far in advance as is practicable.
(4) Major sugar countries defined.--For purposes of this
subsection, the term ``major sugar growing, producing, and
exporting countries'' means--
(A) the countries of the European Union; and
(B) the ten foreign countries not covered by
subparagraph (A) that the Secretary determines produce
the greatest amount of sugar.
(5) Agreement on agriculture defined.--For purposes of this
subsection, the term ``Agreement on Agriculture'' means the
Agreement on Agriculture referred to in section 101(d)(2) of
the Uruguay Round Agreements Act (19 U.S.C. 3511(d)(2)).
(d) Term of Loans.--
(1) In general.--Loans under this section during any fiscal
year shall be made available not earlier than the beginning of
the fiscal year and shall mature at the earlier of--
(A) the end of 9 months; or
(B) the end of the fiscal year.
(2) Supplemental loans.--In the case of loans made under
this section in the last 3 months of a fiscal year, the
processor may repledge the sugar as collateral for a second
loan in the subsequent fiscal year, except that the second loan
shall--
(A) be made at the loan rate in effect at the time
the second loan is made; and
(B) mature in 9 months less the quantity of time
that the first loan was in effect.
(e) Loan Type; Processor Assurances.--
(1) Recourse loans.--Subject to paragraph (2), the
Secretary shall carry out this section through the use of
recourse loans.
(2) Nonrecourse loans.--During any fiscal year in which the
tariff rate quota for imports of sugar into the United States
is established at, or is increased to, a level in excess of
1,500,000 short tons raw value, the Secretary shall carry out
this section by making available nonrecourse loans. Any
recourse loan previously made available by the Secretary under
this section during the fiscal year shall be changed by the
Secretary into a nonrecourse loan.
(3) Processor assurances.--If the Secretary is required
under paragraph (2) to make nonrecourse loans available during
a fiscal year or to change recourse loans into nonrecourse
loans, 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.
(f) Marketing Assessment.--
(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 of any sugar pledged as collateral for
a nonrecourse loan shall be reduced in proportion to the loan
forfeiture penalty incurred by the processor.
(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) 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) Monthly reports.--Taking into consideration the
information received under paragraph (1), the Secretary shall
publish on a monthly basis composite data on production,
imports, distribution, and stock levels of sugar.
(i) Marketing Allotments.--Part VII of subtitle B of title III of
the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359aa et seq.) is
repealed.
(j) Crops.--This section (other than subsection (i)) shall be
effective only for the 1996 through 2002 crops of sugar beets and
sugarcane.
SEC. 108. ADMINISTRATION.
(a) Commodity Credit Corporation.--
(1) Use of corporation.--The Secretary shall carry out this
title through the Commodity Credit Corporation.
(2) Prohibition on salaries and expenses.--Notwithstanding
any other provision of law, no funds of the Corporation shall
be used for any salary or expense of any officer or employee of
the Department of Agriculture.
(b) Determinations by Secretary.--A determination made by the
Secretary under this title or the Agricultural Adjustment Act of 1938
(7 U.S.C. 1281 et seq.) shall be final and conclusive.
(c) Regulations.--The Secretary may issue such regulations as the
Secretary determines necessary to carry out this title.
SEC. 109. ELIMINATION OF PERMANENT PRICE SUPPORT AUTHORITY.
(a) Agricultural Adjustment Act of 1938.--The Agricultural
Adjustment Act of 1938 is amended--
(1) in title III--
(A) in subtitle B--
(i) by striking parts II through V (7
U.S.C. 1326-1351); and
(ii) in part VI--
(I) by moving subsection (c) of
section 358d (7 U.S.C. 1358d(c)) to
appear after section 301(b)(17) (7
U.S.C. 1301(b)(17)), redesignating the
subsection as paragraph (18), and
moving the margin of the paragraph 2
ems to the right; and
(II) by striking sections 358,
358a, and 358d (7 U.S.C. 1358, 1358a,
and 1359); and
(B) by striking subtitle D (7 U.S.C. 1379a-1379j);
and
(2) by striking title IV (7 U.S.C. 1401-1407).
(b) Agricultural Act of 1949.--
(1) Transfer of certain sections.--The Agricultural Act of
1949 is amended--
(A) by transferring sections 106, 106A, and 106B (7
U.S.C. 1445, 1445-1, 1445-2) to appear after section
314A of the Agricultural Adjustment Act of 1938 (7
U.S.C. 1314-1) and redesignating the transferred
sections as sections 315, 315A, and 315B, respectively;
(B) by transferring section 111 (7 U.S.C. 1445f) to
appear after section 304 of the Agricultural Adjustment
Act of 1938 (7 U.S.C. 1304) and redesignating the
transferred section as section 305; and
(C) by transferring sections 404 and 416 (7 U.S.C.
1424 and 1431) to appear after section 390 of the
Agricultural Adjustment Act of 1938 (7 U.S.C. 1390) and
redesignating the transferred sections as sections 390A
and 390B, respectively.
(2) Repeal.--The Agricultural Act of 1949 (7 U.S.C. 1421 et
seq.) (as amended by paragraph (1)) is repealed.
(c) Conforming Amendments.--
(1) Section 361 of the Agricultural Adjustment Act of 1938
(7 U.S.C. 1361) is amended by striking ``, corn, wheat, cotton,
peanuts, and rice, established''.
(2) Section 371 of the Agricultural Adjustment Act of 1938
(7 U.S.C. 1371) is amended--
(A) in the first sentence of subsection (a), by
striking ``cotton, rice, peanuts, or''; and
(B) in the first sentence of subsection (b), by
striking ``cotton, rice, peanuts or''.
SEC. 110. EFFECT OF AMENDMENTS.
(a) Effect on Prior Crops.--Except as otherwise specifically
provided and notwithstanding any other provision of law, this title and
the amendments made by this title shall not affect the authority of the
Secretary to carry out a price support or production adjustment program
for any of the 1991 through 1995 crops of an agricultural commodity
established under a provision of law in effect immediately before the
date of the enactment of this Act.
(b) Liability.--A provision of this title or an amendment made by
this title shall not affect the liability of any person under any
provision of law as in effect before the date of the enactment of this
Act.
TITLE II--DAIRY
Subtitle A--Milk Price Support and Other Activities
SEC. 201. MILK PRICE SUPPORT PROGRAM.
(a) Support Activities.--To replace the milk price support program
established under section 204 of the Agricultural Act of 1949 (7 U.S.C.
1446e), which is repealed by section 109(b)(2)), the Secretary of
Agriculture shall use the authority provided in this section to support
the price of milk produced in the 48 contiguous States through the
purchase of cheddar cheese produced from such milk. Until the first day
of the first month beginning not less than 30 days after the date of
the enactment of this Act, the Secretary also may support the price of
milk under this section through the purchase of butter and nonfat dry
milk produced from milk produced in the 48 contiguous States.
(b) Rate.--The price of milk shall be supported at the following
rates per hundredweight for milk containing 3.67 percent butterfat:
(1) During calendar year 1996, not less than $10.35.
(2) During calendar year 1997, not less than $10.25.
(3) During calendar year 1998, not less than $10.15.
(4) During calendar year 1999, not less than $10.05.
(5) During calendar year 2000, not less than $9.95.
(6) During calendar years 2001 and 2002, not less than
$9.85.
(c) Bid Prices.--The Commodity Credit Corporation support purchase
prices under this section for cheddar cheese (and for butter and nonfat
dry milk subject to subsection (a)) announced by the Corporation shall
be the same for all of that milk product sold by persons offering to
sell the product to the Corporation. The purchase prices shall be
sufficient to enable plants of average efficiency to pay producers, on
average, a price not less than the rate of price support for milk in
effect during a 12-month period under this section.
(d) Use of Commodity Credit Corporation.--The Secretary shall use
the funds, facilities, and authorities of the Commodity Credit
Corporation to carry out this section.
(e) Residual Authority for Refund of Budget Deficit Assessments.--
(1) Application of subsection.--This subsection shall apply
with respect to the reductions made under subsection (h)(2) of
section 204 of the Agricultural Act of 1949, as in effect on
the day before the date of the enactment of this Act, in the
price of milk received by producers during calendar years 1995
and 1996.
(2) Refund required.--The Secretary shall provide a refund
of the entire reduction made under such subsection (h)(2) in
the price of milk received by a producer during a calendar year
referred to in paragraph (1) if the producer provides evidence
that the producer did not increase marketings in that calendar
year when compared to the preceding calendar year.
(3) Treatment of refunds.--A refund under this subsection
shall not be considered as any type of price support or payment
for purposes of sections 1211 and 1221 of the Food Security Act
of 1985 (16 U.S.C. 3811, 3821).
(g) Transfer of Milk Products to Military and Veterans Hospitals.--
(1) Transfer authorized.--As a means of increasing the
utilization of milk and milk products, upon the certification
by the Secretary of Veterans Affairs or by the Secretary of the
Army, acting for the military departments under the Single
Service Purchase Assignment for Subsistence of the Department
of Defense, that the usual quantities of milk products have
been purchased in the normal channels of trade, the Commodity
Credit Corporation shall make available--
(A) to the Secretary of Veterans Affairs at
warehouses where milk products are stored, such milk
products acquired under this section as the Secretary
of Veterans Affairs certifies are required in order to
provide milk products as a part of the ration in
hospitals under the jurisdiction of the Secretary of
Veterans Affairs; and
(B) to the Secretary of the Army, at warehouses
where milk products are stored, such milk products
acquired under this section as the Secretary of the
Army certifies can be utilized in order to provide
additional milk products as a part of the ration--
(i) of the Army, Navy, Air Force, or Coast
Guard;
(ii) in hospitals under the jurisdiction of
the Department of Defense; and
(iii) of cadets and midshipmen at, and
other personnel assigned to, the United States
Merchant Marine Academy.
(2) Reports.--The Secretary of Veterans Affairs and the
Secretary of the Army shall report every six months to the
Committee on Agriculture, Nutrition, and Forestry of the Senate
and the Committee on Agriculture of the House of
Representatives and the Secretary of Agriculture the amount of
milk products used under this subsection.
(3) Process.--The Secretary of Veterans Affairs and the
Secretary of the Army shall reimburse the Commodity Credit
Corporation for all costs associated in making milk products
available under this subsection.
(4) Limitation.--The obligation of the Commodity Credit
Corporation to make milk products available pursuant to this
subsection shall be limited to milk products acquired by the
Corporation under this section and not disposed of under
provisions (1) and (2) of section 390B(a) of the Agricultural
Adjustment Act of 1938.
(h) Period of Effectiveness.--Notwithstanding any other provision
of law, this section shall be effective only during the period--
(1) beginning on the date of the enactment of this Act; and
(2) ending on December 31, 2002.
SEC. 202. RECOURSE LOANS FOR COMMERCIAL PROCESSORS OF DAIRY PRODUCTS.
(a) Recourse Loans Available.--The Secretary of Agriculture shall
make recourse loans available to commercial processors of eligible
dairy products to assist such processors to manage inventories of
eligible dairy products to assure a greater degree of price stability
for the dairy industry during the year. Recourse loans may be made
available under such reasonable terms and conditions as the Secretary
may prescribe. 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 90 percent of the
reference price for that product. The rate of interest charged
participants in this program shall not be less than the rate of
interest charged the Commodity Credit Corporation by the United States
Treasury.
(c) Period of Loans.--A recourse loan made under this section may
not extend beyond the end of the fiscal year during which the loan is
made, except that the Secretary may extend the loan for an additional
period not to exceed the end of the next fiscal year.
(d) Definitions.--In this section:
(1) The term ``eligible dairy products'' means cheddar
cheese, butter, and nonfat dry milk.
(2) The term ``reference price'' means--
(A) for cheddar cheese, the average National (Green
Bay) Cheese Exchange price for 40 pound blocks of
cheddar cheese for the previous three months;
(B) for butter, the average Chicago Mercantile
Exchange price for Grade AA butter for the previous
three months; and
(C) for nonfat dry milk, the average Western States
Extra Grade and Grade A price for nonfat dry milk for
the previous three months.
SEC. 203. DAIRY EXPORT INCENTIVE PROGRAM.
(a) Duration.--Subsection (a) of section 153 of the Food Security
Act of 1985 (15 U.S.C. 713a-14) is amended by striking ``2001'' and
inserting ``2002''.
(b) Elements of Program.--Subsection (c) of such section is
amended--
(1) by striking ``and'' at the end of paragraph (1);
(2) by striking the period at the end of paragraph (2) and
inserting ``; and''; and
(3) by adding at the end the following new paragraphs:
``(3) the maximum volume of dairy product exports allowable
consistent with the obligations of the United States as a
member of the World Trade Organization are exported under the
program each year (minus the volume sold under section 1163 of
this Act (7 U.S.C. 1731 note) during that year), except to the
extent that the export of such a volume under the program
would, in the judgment of the Secretary, exceed the limitations
on the value set forth in subsection (f); and
``(4) payments may be made under the program for exports to
any destination in the world for the purpose of market
development, except a destination in a country with respect to
which shipments from the United States are otherwise restricted
by law.''.
(c) Sole Discretion.--Subsection (b) of such section is amended by
inserting ``sole'' before ``discretion''.
(d) Market Development.--Subsection (e)(1) of such section is
amended--
(1) by striking ``and'' and inserting ``the''; and
(2) by inserting before the period the following: ``, and
any additional amount that may be required to assist in the
development of world markets for United States dairy
products''.
(e) Maximum Allowable Amounts.--Such section is further amended by
adding at the end the following:
``(f) Required Funding.--The Commodity Credit Corporation shall in
each year use money and commodities for the program under this section
in the maximum amount consistent with the obligations of the United
States as a member of the World Trade Organization, minus the amount
expended under section 1163 of this Act (7 U.S.C. 1731 note) during
that year. However, the Commodity Credit Corporation may not exceed the
limitations specified in subsection (c)(3) on the volume of allowable
dairy product exports.''.
SEC. 204. DAIRY PROMOTION PROGRAM.
(a) Expansion To Cover Dairy Products Imported Into the United
States.--Section 110(b) of the Dairy Production Stabilization Act of
1983 (7 U.S.C. 4501(b)) is amended by inserting after ``commercial
use'' the following: ``and dairy products imported into the United
States''.
(b) Definitions.--
(1) Milk.--Subsection (d) of section 111 of such Act (7
U.S.C. 4502) is amended by inserting before the semicolon the
following: ``or cow's milk imported into the United States in
the form of dairy products intended for consumption in the
United States''.
(2) Dairy products.--Subsection (e) of such section is
amended by inserting before the semicolon the following: ``and
casein (except casein imported under sections 3501.90.20
(casein glue) and 3501.90.50 (other) of the Harmonized Tariff
Schedule)''.
(3) Research.--Subsection (j) of such section is amended by
inserting before the semicolon the following: ``or to reduce
the costs associated with processing or marketing those
products''.
(4) United states.--Subsection (l) of such section is
amended to read as follows:
``(l) the term `United States' means the several States and
the District of Columbia;''.
(5) Importers and exporters.--Such section is further
amended--
(A) in subsection (k), by striking ``and'' at the
end of such subsection; and
(B) by adding at the end the following new
subsections:
``(m) the term `importer' means the first person to take
title to dairy products imported into the United States for
domestic consumption; and
``(n) the term `exporter' means any person who exports
dairy products from the United States.''.
(c) Membership of Board.--Section 113(b) of such Act (7 U.S.C.
4504(b)) is amended--
(1) in the first sentence, by striking ``thirty-six
members'' and inserting ``38 members, including one
representative of importers and one representative of exporters
to be appointed by the Secretary'';
(2) in the second sentence, by striking ``Members'' and
inserting ``The remaining members''; and
(3) in the third sentence, by striking ``United States''
and inserting ``United States, including Alaska and Hawaii''.
(d) Assessment.--Section 113(g) of such Act (7 U.S.C. 4504(g)) is
amended--
(1) by inserting ``(1)'' after ``(g)''; and
(2) by adding at the end the following new paragraph:
``(2) The order shall provide that each importer of dairy products
intended for consumption in the United States shall remit to the Board,
in the manner prescribed by the order, an assessment equal to 1.2 cents
per pound of total milk solids contained in the imported dairy
products, or 15 cents per hundredweight of milk contained in the
imported dairy products, whichever is less. If an importer can
establish that it is participating in active, ongoing qualified State
or regional dairy product promotion or nutrition programs intended to
increase the consumption of milk and dairy products, the importer shall
receive credit in determining the assessment due from that importer for
contributions to such programs of up to .8 cents per pound of total
milk solids contained in the imported dairy products, or 10 cents per
hundredweight of milk contained in the imported dairy products,
whichever is less. The assessment collected under this paragraph shall
be used for the purpose specified in paragraph (1).''.
(e) Records.--Section 113(k) of such Act (7 U.S.C. 4504(k)) is
amended in the first sentence by inserting after ``commercial use,''
the following: ``each importer of dairy products,''.
(f) Termination or Suspension of Order.--Section 116(b) of such Act
(7 U.S.C. 4507(b)) is amended--
(1) by inserting ``and importers'' after ``producers'' each
place it appears;
(2) by striking ``who, during a representative period (as
determined by the Secretary), have been engaged in the
production of milk for commercial use''; and
(3) by adding at the end the following new sentences: ``A
producer shall be eligible to vote in the referendum if the
producer, during a representative period (as determined by the
Secretary), has been engaged in the production of milk for
commercial use. An importer shall be eligible to vote in the
referendum if the importer, during a representative period (as
determined by the Secretary), has been engaged in the
importation of dairy products into the United States intended
for consumption in the United States.''.
(g) Promotion in International Markets.--Section 113(e) of such Act
(7 U.S.C. 4504(e)) is amended by adding at the end the following new
sentence: ``For each of the fiscal years 1996 through 2000, the Board's
budget shall provide for the expenditure of not less than 10 percent of
the anticipated revenues available to the Board to develop
international markets for, and to promote within such markets, the
consumption of dairy products produced in the United States from milk
produced in the United States.''.
(h) Implementation of Amendments.--
(1) Implementation process.--To implement the amendments
made by this section, the Secretary of Agriculture shall issue
an amended dairy products promotion and research order under
section 112 of the Dairy Production Stabilization Act of 1983
(7 U.S.C. 4503) reflecting such amendments, and no other
changes, in the order in existence on the date of the enactment
of this Act.
(2) Proposal of amended order.--Not later than 60 days
after the date of the enactment of this Act, the Secretary
shall publish a proposed dairy products promotion and research
order reflecting the amendments made by this section. The
Secretary shall provide notice and an opportunity for public
comment on the proposed order.
(3) Issuance of amended order.--After notice and
opportunity for public comment are provided in accordance with
paragraph (2), the Secretary shall issue a final dairy products
promotion and research order, taking into consideration the
comments received and including in the order such provisions as
are necessary to ensure that the order is in conformity with
the amendments made by this section.
(4) Effective date.--The final dairy products promotion and
research order shall be issued and become effective not later
than 120 days after publication of the proposed order.
(i) Referendum on Amendments.--Not later than 36 months after the
issuance of the dairy products promotion and research order reflecting
the amendments made by this section, the Secretary of Agriculture shall
conduct a referendum under section 115 of the Dairy Production
Stabilization Act of 1983 (7 U.S.C. 4506) for the sole purpose of
determining whether the requirements of such amendments shall be
continued. The Secretary shall conduct the referendum among persons who
have been producers or importers (as defined in section 111 of such Act
(7 U.S.C. 4502)) during a representative period as determined by the
Secretary. The requirements of such amendments shall be continued only
if the Secretary determines that such requirements have been approved
by not less than a majority of the persons voting in the referendum. If
continuation of the amendments is not approved, the Secretary shall
issue a new order, within six months after the announcement of the
results of the referendum, that is identical to the order in effect on
the date of the enactment of this Act. The new order shall become
effective upon issuance and shall not be subject to referendum for
approval.
SEC. 205. FLUID MILK STANDARDS UNDER MILK MARKETING ORDERS.
(a) Nature of Standards.--Each marketing order issued with respect
to milk and its products under section 8c of the Agricultural
Adjustment Act (7 U.S.C. 608c), reenacted with amendments by the
Agricultural Marketing Agreement Act of 1937, shall contain terms and
conditions to provide that all dispositions of fluid milk products
containing milk of the highest use classification covered by such
orders shall comply with the following requirements:
(1) In the case of milk marketed as whole milk, not less
than 12.05 percent total milk solids consisting of not less
than 8.8 percent milk solids not fat and not less than 3.25
percent milk fat.
(2) In the case of milk marketed as 2 percent (or lowfat)
milk, not less than 12 percent total milk solids consisting of
not less than 10 percent milk solids not fat and not less than
2 percent milk fat.
(3) In the case of milk marketed as 1 percent (or light)
milk, not less than 12 percent total milk solids consisting of
not less than 11 percent milk solids not fat and not less than
1 percent milk fat.
(4) In the case of milk marketed as skim (or nonfat) milk,
not less than 9 percent total milk solids consisting of not
less than 9 percent milk solids not fat and not more than .25
percent milk fat.
(b) Violations.--A violation of the requirements specified in
subsection (a) shall be subject to the penalties provided in section
8c(14) of the Agricultural Adjustment Act (7 U.S.C. 608c(14)),
reenacted with amendments by the Agricultural Marketing Agreement Act
of 1937.
(c) Effective Date.--The requirements imposed by this section shall
apply to fluid milk marketed on and after the first day of the first
month beginning not less than 30 days after the date of the enactment
of this Act.
SEC. 206. MANUFACTURING ALLOWANCE.
(a) Maximum Allowances Established.--No State shall provide for a
manufacturing allowance for the processing of milk in excess of--
(1) in the case of milk manufactured into butter, butter
oil, nonfat dry milk, or whole dry milk--
(A) $1.65 per hundredweight of milk, for milk
marketed during the 2-year period beginning on the
effective date of this section; and
(B) such allowance per hundredweight of milk as the
Secretary of Agriculture may establish under section
221(b)(3), for milk marketed after the end of such
period; and
(2) in the case of milk manufactured into cheese and whey--
(A) $1.80 per hundredweight of milk, for milk
marketed during the 2-year period beginning on the
effective date of this section; and
(B) such allowance per hundredweight of milk as the
Secretary may establish under section 221(b)(3), for
milk marketed after the end of such period.
(b) Yields.--In converting the weight of milk to dairy products
during the two-year period beginning on the effective date of this
section, the Secretary shall use the following yields with respect to a
hundred pounds of milk:
(1) Butter: 4.2 pounds.
(2) Nonfat dry milk: 8.613 pounds.
(3) 40 pound block cheddar cheese: 10.169 pounds.
(4) Whey cream butter: .27 pounds.
(c) Sources of Product Price Values.--In determining the
manufacturing allowance applicable in a State during the 2-year period
beginning on the effective date of this section, the Secretary shall
use the following sources for product price values:
(1) For butter, Chicago Mercantile Exchange Grade AA
butter.
(2) For nonfat dry milk, California Manufacturing Plants
Extra Grade and Grade A nonfat dry milk.
(3) For cheese, National (Green Bay) Cheese Exchange 40
pound block cheddar cheese.
(4) For whey cream butter, Chicago Mercantile Exchange
Grade B butter.
(d) Manufacturing Allowance Defined.--In this section, the term
``manufacturing allowance'' means--
(1) the amount by which the product price value of butter
and nonfat dry milk manufactured from a hundred pounds of milk
containing 3.5 pounds of milk fat and 8.7 pounds of milk solids
not fat exceeds the class price for the milk used to produce
those products; or
(2) an amount by which the product price value of cheese
and whey manufactured from a hundred pounds of milk containing
3.6 pounds of milk fat and 8.7 pounds of milk solids not fat
exceeds the class price for the milk used to produce those
products.
(e) Effect of Violation.--If the Secretary determines that a State
has in effect a manufacturing allowance that exceeds the manufacturing
allowance authorized in subsection (a), the Secretary shall suspend,
until such time as the State complies with such subsection--
(1) purchases under section 201 of cheddar cheese produced
in that State; and
(2) disbursements from the Class IV equalization pool under
section 208 to milk marketing orders operating in that State
with respect to milk produced in that State.
(f) Conforming Suspension and Repeal.--
(1) Suspension and repeal.--During the 2-year period
beginning on the effective date of this section, the
requirements of section 102 of the Food, Agriculture,
Conservation, and Trade Act of 1990 (7 U.S.C. 1446e-1) shall
not apply. Effective on the first day after the end of such
period, such section is repealed.
(2) Exception.--Notwithstanding paragraph (1), in the event
that an injunction or other order of a court prohibits or
impairs the implementation of this section or the activities of
the Secretary under this section, the Secretary shall use the
authorities provided by section 102 of the Food, Agriculture,
Conservation, and Trade Act of 1990 (7 U.S.C. 1446e-1) until
such time as the injunction or other court order is lifted.
(g) Effective Date; Implementation.--This section shall take effect
on the first day of the first month beginning not less than 30 days
after the date of the enactment of this Act. After such effective date,
the Secretary may exercise the authority provided to the Secretary
under this section without regard to the issuance of regulations
intended to carry out this section.
SEC. 207. ESTABLISHMENT OF TEMPORARY CLASS I PRICE AND TEMPORARY CLASS
I EQUALIZATION POOLS.
(a) Temporary Pricing for Milk of the Highest Use Classification
(Class I Milk).--
(1) Establishment of minimum price.--During the 2-year
period beginning on the effective date of this section, the
minimum price for milk of the highest use classification
marketed under a 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,
shall not be less than the sum of--
(A) $12.87 per hundredweight; and
(B) the aggregate adjustment in effect under
clauses (1) and (2) of the second sentence of paragraph
(5)(A) of such section on December 31, 1995, for milk
of the highest use classification in that order.
(2) Addition to minimum price.--If the basic formula price
for milk exceeds $12.87 per hundredweight in any month during
the 2-year period beginning on the effective date of this
section, the positive difference between the basic formula
price and $12.87 shall be added to the price for milk of the
highest use classification marketed under a marketing order
issued under such section 8c in the second month following the
month in which the difference occurred.
(3) Effect on other use classifications.--This subsection
shall not affect the calculation of the basic formula price
used to determine the price for milk of use classifications
other than the highest use classification.
(b) Class I Equalization Pools.--
(1) Collections.--During the 2-year period beginning on the
effective date of this section, the Secretary of Agriculture
shall collect, on a monthly basis, from each marketing order
issued with respect to milk and its products 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 from the comparable milk marketing order issued by
the State of California, an amount equal to the product of--
(A) $0.80 per hundredweight; and
(B) the total hundredweights of all milk of the
highest use classification marketed under the order for
the month.
(2) Disbursements.--The Secretary shall pay, on a monthly
basis, to each marketing order referred to in paragraph (1) an
amount equal to the product of--
(A) the total collection under paragraph (1) for
the month; and
(B) the ratio of the total hundredweights of all
milk marketed for the month under that order to all
milk marketed for the month under all such orders.
(3) Effect on blend prices.--Producer blend prices under a
milk marketing order shall be adjusted to account for
collections made under paragraph (1) and disbursements made
under paragraph (2).
(c) Enforcement.--
(1) In general.--Amounts for which a milk marketing order
are responsible under subsection (b) shall be determined on a
monthly basis and shall be collected and remitted to the
Secretary in the manner prescribed by the Secretary.
(2) Penalties.--If any person fails to remit the amount
required in subsection (b) or fails to comply with such
requirements for recordkeeping or otherwise as are required by
the Secretary to carry out this section, the person shall be
liable to the Secretary for a civil penalty up to an amount
determined by multiplying--
(A) the quantity of milk involved in the violation;
by
(B) the support rate for milk in effect at the time
of the violation under section 201.
(3) Enforcement.--The Secretary may enforce this section in
the courts of the United States.
(d) Conforming Repeal.--Section 8c(5)(A) of the Agricultural
Adjustment Act (7 U.S.C. 608c(5)(A)), reenacted with amendments by the
Agricultural Marketing Agreement Act of 1937, is amended by striking
out the sentence beginning ``Throughout the 2-year period'' and all
that follows through the end of the subparagraph.
(e) Effective Date.--Except as provided in subsection (f), this
section shall take effect on the first day of the first month beginning
not less than 30 days after the date of the enactment of this Act.
(f) Implementation.--Not later than the effective date of this
section, the Secretary shall amend Federal milk marketing orders 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, to effectuate the requirements of this section. The amendments
shall not be--
(1) subject to a referendum under subsection (17) or (19)
of such section among milk producers to determine whether
issuance of such order is approved or favored by milk
producers;
(2) preconditioned on the existence of a marketing
agreement among handlers under subsection (8) of such section
and section 8b of such Act (7 U.S.C. 608b);
(3) subject to rulemaking under title 5, United States
Code; or
(4) subject to review or approval by other executive
agencies.
SEC. 208. ESTABLISHMENT OF TEMPORARY CLASS IV PRICE AND TEMPORARY CLASS
IV EQUALIZATION POOL.
(a) Temporary Classification of Class IV Milk.--
(1) Classification.--For purposes of classifying milk in
accordance with the form in which or the purpose for which it
is used, the Secretary of Agriculture shall designate all milk
marketed in the 48 contiguous States of the United States and
used to produce butter, butter oil, nonfat dry milk, or dry
whole milk as Class IV milk. The Secretary may include other
products of milk, except cheese, within the Class IV
classification if the Secretary determines that inclusion of
the product would be fair and equitable.
(2) Use of classification.--Each marketing order issued
with respect to milk and its products 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 each comparable State milk marketing order, shall use the
classification required by paragraph (1) in lieu of any other
classification, such as Class III-A milk, to properly classify
milk used to produce butter, butter oil, nonfat dry milk, or
dry whole milk.
(b) Establishment of Class IV Pool.--The Secretary shall establish
a Class IV pool for the purpose of making collections and disbursements
related to milk classified as Class IV milk under subsection (a). The
Class IV pool shall apply to milk covered by a milk marketing order
referred to in subsection (a) and unregulated milk.
(c) Establishment of Monthly Class IV Price.--For the purpose of
determining whether the Secretary will make collections and
disbursements under the Class IV equalization pool, the Secretary shall
establish, on a monthly basis, a price for dairy products manufactured
from Class IV milk on a 3.5 percent butterfat basis. In determining
that price, the Secretary shall calculate the amount equal to--
(1) the sum of--
(A) the product of the Western States Extra Grade
and Grade A price per pound for nonfat dry milk and
8.613; and
(B) the product of the Chicago Mercantile Exchange
Grade AA price per pound for butter and 4.2; less
(2) a manufacturing allowance equal to $1.65 per
hundredweight of milk.
(d) Operation of Class IV Equalization Pool.--
(1) Application of subsection.--This subsection shall apply
in any month in which the support price for milk under section
201, adjusted to 3.5 percent butterfat, exceeds the Class IV
price established under subsection (c).
(2) Collection.--In any month in which the Class IV
equalization pool is in operation under paragraph (1), each
milk marketing order referred to in subsection (a) and each
handler of unregulated milk shall pay into the Class IV
equalization pool an amount equal to the product of--
(A) the total hundredweights of Class IV milk used
to manufacture dairy products during that month under
all such orders and by all such handlers;
(B) 50 percent of the amount by which the support
price for milk under section 201, adjusted to 3.5
percent butterfat, exceeded the Class IV price
determined under subsection (c) for that month; and
(C) the ratio of the total hundredweights of all
milk marketed during that month under that order or by
that handler to the total hundredweights of all milk
marketed for that month under all such orders and by
all such handlers.
(3) Disbursements.--In any month in which the Class IV
equalization pool is in operation under paragraph (1), each
milk marketing order referred to in subsection (a) in which
products were manufactured from Class IV milk during that month
and each handler of unregulated milk that manufactured products
from Class IV milk during that month shall receive from the
Class IV equalization pool an amount equal to the product of--
(A) the total collection under paragraph (2) for
the month; and
(B) the ratio of the total hundredweights of Class
IV milk manufactured into dairy products during that
month under that order or by that handler to the total
hundredweights of Class IV milk manufactured into dairy
products during that month under all such orders and by
all such handlers.
(4) Effect on blend prices.--Producer blend prices under a
milk marketing order referred to in subsection (a) shall be
adjusted to account for collections under paragraph (2) and
disbursements under paragraph (3).
(e) Enforcement.--
(1) In general.--Amounts for which a milk marketing order
or handler are responsible under subsection (b) shall be
determined on a monthly basis and shall be collected and
remitted to the Secretary in the manner prescribed by the
Secretary.
(2) Penalties.--If any person fails to remit the amount
required in subsection (c) or fails to comply with such
requirements for recordkeeping or otherwise as are required by
the Secretary to carry out this section, the person shall be
liable to the Secretary for a civil penalty up to an amount
determined by multiplying--
(A) the quantity of milk involved in the violation;
by
(B) the support rate for milk in effect at the time
of the violation under section 201.
(3) Enforcement.--The Secretary may enforce this section in
the courts of the United States.
(f) Effective Date.--Except as provided in subsection (g), this
section shall--
(1) take effect on the first day of the first month
beginning not less than 30 days after the date of the enactment
of this Act; and
(2) apply during the 2-year period beginning on such
effective date.
(g) Implementation.--Not later than the start of the effective date
of this section, the Secretary shall amend Federal milk marketing
orders 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, to effectuate the requirements of this section.
The amendments shall not be--
(1) subject to referendum under subsection (17) or (19) of
such section among milk producers to determine whether issuance
of such order is approved or favored by milk producers;
(2) preconditioned on the existence of a marketing
agreement among handlers under subsection (8) of such section
and section 8b of such Act (7 U.S.C. 608b);
(3) subject to rulemaking under title 5, United States
Code; or
(4) subject to review or approval by other executive
agencies.
SEC. 209. AUTHORITY FOR ESTABLISHMENT OF STANDBY POOLS.
(a) Authority To Establish.--As soon as possible after the
effective date of this section, the Secretary of Agriculture shall
publish in the Federal Register an invitation for interested persons to
submit proposals for the establishment within Federal milk marketing
orders 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, of standby pools to facilitate the movement of
milk over long distances during periods of shortage through the sharing
of proceeds from sales of milk of the highest use classification due to
producers under the order with producers shipping to plants regulated
by another order to provide a reserve supply of milk in the other
market.
(b) Approval or Termination of Participation in Standby Pool.--
Order provisions under this section shall not become effective in any
marketing order unless such provisions are approved by producers in the
manner provided for the approval of marketing orders under section 8c
of the Agricultural Adjustment Act (7 U.S.C. 608c), reenacted with
amendments by the Agricultural Marketing Agreement Act of 1937, but
separately from other order provisions. Standby pool provisions
approved under this section in an order may be disapproved separately
by producers or terminated separately by the Secretary under section
8c(16)(B) of such Act. Such disapproval or termination shall not be
considered to be a disapproval or termination of the other terms of
that order.
(c) Effective Date.--This section shall take effect on the first
day of the first month beginning not less than 30 days after the date
of the enactment of this Act.
Subtitle B--Reform of Federal Milk Marketing Orders
SEC. 221. ISSUANCE OR AMENDMENT OF FEDERAL MILK MARKETING ORDERS TO
IMPLEMENT CERTAIN REFORMS.
(a) Issuance of Amended Orders.--Subject to the time limits
specified in section 222, the Secretary of Agriculture shall issue new
or amended marketing orders with respect to milk and its products under
section 8c of the Agricultural Adjustment Act (7 U.S.C. 608c),
reenacted with amendments by the Agricultural Marketing Agreement Act
of 1937, to effectuate the requirements of subsection (b). The orders
shall take effect on the date the orders are issued and shall supersede
all other marketing orders and any other statutes, rules, and
regulations that are applicable to the pricing and marketing of milk
and its products in effect immediately before that date, whether under
the authority of section 8c of such Act or a State or local law.
(b) Reform Requirements.--The Secretary shall reform the Federal
milk marketing order system under subsection (a) to accomplish the
following purposes:
(1) Consolidation of Federal milk marketing orders into not
less than 8 nor more than 13 orders, which shall also include
those areas of the 48 contiguous States not covered by a
Federal milk marketing order on the date of the enactment of
this Act. One of the new Federal milk marketing orders shall
only cover the State of California. A new or amended order
shall have the right to blend order receipts to address unique
issues to that order such as a preexisting State quota system.
(2) Implementation of uniform multiple component pricing
for milk used in manufactured dairy products.
(3) Establishment of class prices for milk used to produce
cheese, nonfat dry milk, and butter based on national product
prices, less a manufacturing allowance. The resulting prices
shall not vary regionally, except to reflect variances in
transportation and reasonable operating costs, if any, of
efficient processing plants in different geographical areas.
(c) Status of Producer Handlers.--In amending Federal milk
marketing orders under this section, the Secretary shall ensure that
the legal status of producer handlers of milk under the Agricultural
Adjustment Act (7 U.S.C. 601 et seq.), reenacted with amendments by the
Agricultural Marketing Agreement Act of 1937, shall be the same after
the amendments made by this section take effect as it was before the
effective date of the amendments.
SEC. 222. REFORM PROCESS.
(a) Process.--In preparation for the issuance of the new or amended
Federal milk marketing orders required under section 221, the Secretary
of Agriculture shall comply with the following expedited procedural
requirements:
(1) Not later than 165 days after the date of the enactment
of this Act, the Secretary shall issue proposed amendments or
new milk marketing orders to effectuate the reform requirements
specified in such section.
(2) The Secretary shall provide for a 75-day comment period
on the proposed amendments or orders issued under paragraph
(1).
(3) Not later than 120 days after the end of the comment
period provided under paragraph (2), the Secretary shall
publish in the Federal Register a final administrative decision
regarding the issuance or amendment of Federal milk marketing
orders to effectuate the reform requirements specified in such
section.
(b) Referendum and Marketing Agreement.--After the issuance of the
new or amended Federal milk marketing orders under section 221, the
Secretary may conduct a referendum in the manner provided in section
8c(16)(B) of the Agricultural Adjustment Act (7 U.S.C. 608c(16)(B)),
reenacted with amendments by the Agricultural Marketing Agreement Act
of 1937, with respect to each order to determine whether milk producers
subject to the order favor the termination of the order.
(c) Application of Administrative Procedures Act.--The issuance of
the new or amended Federal milk marketing orders required under section
221 shall not be subject to rulemaking under title 5, United States
Code.
(d) Review and Approval.--The action of the Secretary under section
221 shall not be subject to review or approval by any other executive
agency.
SEC. 223. EFFECT OF FAILURE TO COMPLY WITH REFORM PROCESS REQUIREMENTS.
(a) Failure To Timely Issue or Amend Orders.--If, before the end of
the 1-year period beginning on the date of the enactment of this Act,
the Secretary of Agriculture does not issue new or amended Federal milk
marketing orders under section 8c of the Agricultural Adjustment Act (7
U.S.C. 608c), reenacted with amendments by the Agricultural Marketing
Agreement Act of 1937, to effectuate the requirements of section
221(b), then the Secretary may not assess or collect assessments from
milk producers or handlers under such section 8c for marketing order
administration and services provided under such section after the end
of that period. The Secretary may not reduce the level of services
provided under such section on account of the prohibition against
assessments, but shall rather cover the cost of marketing order
administration and services through funds available for the
Agricultural Marketing Service of the Department of Agriculture.
(b) Failure To Timely Implement Orders.--Unless the Secretary
certifies to Congress before the end of the 2-year period beginning on
the date of the enactment of this Act that all of the Federal marketing
order reforms required by section 221(b) have been fully implemented,
then, effective at the end of that period--
(1) the Secretary shall immediately cease all price support
activities under section 201;
(2) the Secretary shall immediately terminate all Federal
milk marketing orders 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 may not
issue any further order under such Act with respect to milk;
(3) the Commodity Credit Corporation shall immediately
cease to operate the dairy export incentive program under
section 153 of the Food Security Act of 1985 (15 U.S.C. 713a-
14);
(4) the Secretary and the National Processor Advertising
and Promotion Board shall immediately cease all activities
under the Fluid Milk Promotion Act of 1990 (7 U.S.C. 6401 et
seq.); and
(5) the Secretary and the National Dairy Promotion and
Research Board shall immediately cease all activities under the
Dairy Production Stabilization Act of 1983 (7 U.S.C. 4501 et
seq.).
(c) Effect of Court Order.--The actions authorized by this section
are intended to ensure the timely publication and implementation of new
and amended Federal milk marketing orders under section 8c of the
Agricultural Adjustment Act (7 U.S.C. 608c), reenacted with amendments
by the Agricultural Marketing Agreement Act of 1937. In the event that
the Secretary is enjoined or otherwise restrained by a court order from
publishing or implementing the reform requirements specified by section
221, the length of time for which that injunction or other restraining
order is effective shall be added to the time limitations specified in
subsections (a) and (b) thereby extending those time limitations by a
period of time equal to the period of time for which the injunction or
other restraining order is effective.
TITLE III--CONSERVATION
SEC. 301. CONSERVATION.
(a) Funding.--Subtitle E of title XII of the Food Security Act of
1985 (16 U.S.C. 3841 et seq.) is amended to read as follows:
``Subtitle E--Funding
``SEC. 1241. FUNDING.
``(a) Mandatory Expenses.--For each of fiscal years 1996 through
2002, the Secretary shall use the funds of the Commodity Credit
Corporation to carry out the programs 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 of chapter 1 of subtitle D; and
``(3) chapter 4 of subtitle D.
``(b) Livestock Environmental Assistance Program.--For each of
fiscal years 1996 through 2002, $100,000,000 of the funds of the
Commodity Credit Corporation shall be available for providing technical
assistance, cost-sharing payments, and incentive payments for practices
relating to livestock production under the livestock environmental
assistance program under chapter 4 of subtitle D.''.
(b) Livestock Environmental Assistance Program.--Subtitle D of
title XII of the Food Security Act of 1985 (16 U.S.C. 3830 et seq.) is
amended by adding at the end the following:
``CHAPTER 4--LIVESTOCK ENVIRONMENTAL ASSISTANCE PROGRAM
``SEC. 1240. DEFINITIONS.
``In this chapter:
``(1) Land management practice.--The term `land management
practice' means a site-specific nutrient or manure management,
irrigation management, tillage or residue management, grazing
management, or other land management practice that the
Secretary determines is needed to protect, in the most cost
effective manner, water, soil, or related resources from
degradation due to livestock production.
``(2) Large confined livestock operation.--The term `large
confined livestock operation' means an operation that--
``(A) is a confined animal feeding operation; and
``(B) has more than--
``(i) 55 mature dairy cattle;
``(ii) 10,000 beef cattle;
``(iii) 30,000 laying hens or broilers (if
the facility has continuous overflow watering);
``(iv) 100,000 laying hens or broilers (if
the facility has a liquid manure system);
``(v) 55,000 turkeys;
``(vi) 15,000 swine; or
``(vii) 10,000 sheep or lambs.
``(3) Livestock.--The term `livestock' means dairy cows,
beef cattle, laying hens, broilers, turkeys, swine, sheep,
lambs, and such other animals as determined by the Secretary.
``(4) Operator.--The term `operator' means a person who is
engaged in livestock production (as defined by the Secretary).
``(5) Structural practice.--The term `structural practice'
means the establishment of an animal waste management facility,
terrace, grassed waterway, contour grass strip, filterstrip, 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 due to livestock
production.
``SEC. 1240A. ESTABLISHMENT AND ADMINISTRATION OF LIVESTOCK
ENVIRONMENTAL ASSISTANCE PROGRAM.
``(a) Establishment.--
``(1) In general.--During the 1996 through 2002 fiscal
years, the Secretary shall provide technical assistance, cost-
sharing payments, and incentive payments to operators who enter
into contracts with the Secretary, through a livestock
environmental assistance program.
``(2) Eligible practices.--
``(A) Structural practices.--An operator who
implements a structural practice shall be eligible for
technical assistance or cost-sharing payments, or both.
``(B) Land management practices.--An operator who
performs a land management practice shall be eligible
for technical assistance or incentive payments, or
both.
``(3) Eligible land.--Assistance under this chapter may be
provided with respect to land that is used for livestock
production and on which a serious threat to water, soil, or
related resources exists, as determined by the Secretary, by
reason of the soil types, terrain, climatic, soil, topographic,
flood, or saline characteristics, or other factors or natural
hazards.
``(4) Selection criteria.--In providing technical
assistance, cost-sharing payments, and incentive payments to
operators in a region, watershed, or conservation priority area
in which an agricultural operation is located, the Secretary
shall consider--
``(A) the significance of the water, soil, and
related natural resource problems; and
``(B) the maximization of environmental benefits
per dollar expended.
``(b) Application and Term.--
``(1) In general.--A contract between an operator and the
Secretary under this chapter may--
``(A) apply to 1 or more structural practices or 1
or more land management practices, or both; and
``(B) 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.
``(2) Duties of operators and secretary.--To receive cost-
sharing or incentive payments, or technical assistance,
participating operators shall comply with all terms and
conditions of the contract and a plan, as established by the
Secretary.
``(c) Structural Practices.--
``(1) Competitive offer.--The Secretary shall administer a
competitive offer system for operators proposing to receive
cost-sharing payments in exchange for the implementation of 1
or more structural practices by the operator. The competitive
offer system shall consist of--
``(A) the submission of a competitive offer by the
operator in such manner as the Secretary may prescribe;
and
``(B) evaluation of the offer in light of the
selection criteria established under subsection (a)(4)
and the projected cost of the proposal, as determined
by the Secretary.
``(2) Concurrence of owner.--If the operator 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 operator 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 an operator in exchange for the
performance of 1 or more land management practices by the operator.
``(e) Cost-Sharing, Incentive Payments, and Technical Assistance.--
``(1) Cost-sharing payments.--
``(A) In general.--The Federal share of cost-
sharing payments to an operator proposing to implement
1 or more structural practices shall not be greater
than 75 percent of the projected cost of each practice,
as determined by the Secretary, taking into
consideration any payment received by the operator from
a State or local government.
``(B) Limitation.--An operator of a large confined
livestock operation shall not be eligible for cost-
sharing payments to construct an animal waste
management facility.
``(C) Other payments.--An operator shall not be
eligible for cost-sharing payments for structural
practices on eligible land under this chapter if the
operator receives cost-sharing payments or other
benefits for the same land under chapter 1, 2, 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 an operator 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 operator to receive technical
assistance under other authorities of law available to
the Secretary.
``(f) Limitation on Payments.--
``(1) In general.--The total amount of cost-sharing and
incentive payments paid to a person under this chapter may not
exceed--
``(A) $10,000 for any fiscal year; or
``(B) $50,000 for any multiyear contract.
``(2) Regulations.--The Secretary shall issue regulations
that are consistent with section 1001 for the purpose of--
``(A) defining the term `person' as used in
paragraph (1); and
``(B) prescribing such rules as the Secretary
determines necessary to ensure a fair and reasonable
application of the limitations established under this
subsection.
``(g) Regulations.--Not later than 180 days after the effective
date of this subsection, the Secretary shall issue regulations to
implement the livestock environmental assistance program established
under this chapter.''.
(c) Conforming Program Changes.--
(1) Wetlands reserve program.--
(A) In general.--Section 1237 of the Food Security
Act of 1985 (16 U.S.C. 3837) is amended--
(i) in subsection (b)(2)--
(I) by striking ``not less'' and
inserting ``not more''; and
(II) by striking ``2000'' and
inserting ``2002''; and
(ii) in subsection (c), by striking
``2000'' and inserting ``2002''.
(B) Length of easement.--Section 1237A(e) of the
Food Security Act of 1985 (16 U.S.C. 3837a(e)) is
amended by striking paragraph (2) and inserting the
following:
``(2) shall be for 15 years, but in no case shall be a
permanent easement.''.
(2) Conservation reserve program.--Section 1231(d) of the
Food Security Act of 1985 (16 U.S.C. 3831(d)) is amended by
striking ``total of'' and all that follows through the period
at the end of the subsection and inserting ``total of
36,400,000 acres.''. Section 725 of the Agriculture, Rural
Development, Food and Drug Administration, and Related Agencies
Appropriations Act, 1996 (Public Law 104-37; 109 Stat. 332), is
amended by striking the proviso relating to enrollment of new
acres in 1997.
TITLE IV--AGRICULTURAL PROMOTION AND EXPORT PROGRAMS
SEC. 401. MARKET PROMOTION PROGRAM.
Effective as of October 1, 1995, section 211(c)(1) of the
Agricultural Trade Act of 1978 (7 U.S.C. 5641(c)(1)) is amended--
(1) by striking ``and'' after ``1991 through 1993,''; and
(2) by striking ``through 1997,'' and inserting ``through
1995, and not more than $100,000,000 for each of fiscal years
1996 through 2002,''.
SEC. 402. EXPORT ENHANCEMENT PROGRAM.
Effective as of October 1, 1995, section 301(e)(1) of the
Agricultural Trade Act of 1978 (7 U.S.C. 5651(e)(1)) is amended to read
as follows:
``(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) $350,000,000 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.''.
TITLE V--MISCELLANEOUS
SEC. 501. CROP INSURANCE.
(a) Catastrophic Risk Protection.--Section 508(b) of the Federal
Crop Insurance Act (7 U.S.C. 1508(b)) is amended--
(1) in paragraph (4), by adding at the end the following:
``(C) Delivery of coverage.--
``(i) In general.--In full consultation
with approved insurance providers, the
Secretary may continue to offer catastrophic
risk protection in a State (or a portion of a
State) through local offices of the Department
if the Secretary determines that there is an
insufficient number of approved insurance
providers operating in the State or portion to
adequately provide catastrophic risk protection
coverage to producers.
``(ii) Coverage by approved insurance
providers.--To the extent that catastrophic
risk protection coverage by approved insurance
providers is sufficiently available in a State
as determined by the Secretary, only approved
insurance providers may provide the coverage in
the State.
``(iii) Current policies.--Subject to
clause (ii), all catastrophic risk protection
policies written by local offices of the
Department shall be transferred (including all
fees collected for the crop year in which the
approved insurance provider will assume the
policies) to the approved insurance provider
for performance of all sales, service, and loss
adjustment functions.''; and
(2) in paragraph (7), by striking subparagraph (A) and
inserting the following:
``(A) In general.--Effective for the spring-planted
1996 and subsequent crops, to be eligible for any
payment or loan under title I of the Agricultural
Market Transition Act or the Agricultural Adjustment
Act of 1938 (7 U.S.C. 1281 et seq.), for the
conservation reserve program, or for any benefit
described in section 371 of the Consolidated Farm and
Rural Development Act (7 U.S.C. 2008f), a person
shall--
``(i) obtain at least the catastrophic
level of insurance for each crop of economic
significance in which the person has an
interest; or
``(ii) provide a written waiver to the
Secretary that waives any eligibility for
emergency crop loss assistance in connection
with the crop.''.
(b) Coverage of Seed Crops.--Section 519(a)(2)(B) of the Act (7
U.S.C. 1519(a)(2)(B)) is amended by inserting ``seed crops,'' after
``turfgrass sod,''.
SEC. 502. COLLECTION AND USE OF AGRICULTURAL QUARANTINE AND INSPECTION
FEES.
Subsection (a) of section 2509 of the Food, Agriculture,
Conservation, and Trade Act of 1990 (21 U.S.C. 136a) is amended to read
as follows:
``(a) Quarantine and Inspection Fees.--
``(1) Fees authorized.--The Secretary of Agriculture may
prescribe and collect fees sufficient--
``(A) to cover the cost of providing agricultural
quarantine and inspection services in connection with
the arrival at a port in the customs territory of the
United States, or the preclearance or preinspection at
a site outside the customs territory of the United
States, of an international passenger, commercial
vessel, commercial aircraft, commercial truck, or
railroad car;
``(B) to cover the cost of administering this
subsection; and
``(C) through fiscal year 2002, to maintain a
reasonable balance in the Agricultural Quarantine
Inspection User Fee Account established under paragraph
(5).
``(2) Limitation.--In setting the fees under paragraph (1),
the Secretary shall ensure that the amount of the fees are
commensurate with the costs of agricultural quarantine and
inspection services with respect to the class of persons or
entities paying the fees. The costs of the services with
respect to passengers as a class includes the costs of related
inspections of the aircraft or other vehicle.
``(3) Status of fees.--Fees collected under this subsection
by any person on behalf of the Secretary are held in trust for
the United States and shall be remitted to the Secretary in
such manner and at such times as the Secretary may prescribe.
``(4) Late payment penalties.--If a person subject to a fee
under this subsection fails to pay the fee when due, the
Secretary shall assess a late payment penalty, and the overdue
fees shall accrue interest, as required by section 3717 of
title 31, United States Code.
``(5) Agricultural quarantine inspection user fee
account.--
``(A) Establishment.--There is established in the
Treasury of the United States a no-year fund, to be
known as the `Agricultural Quarantine Inspection User
Fee Account', which shall contain all of the fees
collected under this subsection and late payment
penalties and interest charges collected under
paragraph (4) through fiscal year 2002.
``(B) Use of account.--For each of the fiscal years
1996 through 2002, funds in the Agricultural Quarantine
Inspection User Fee Account shall be available, in such
amounts as are provided in advance in appropriations
Acts, to cover the costs associated with the provision
of agricultural quarantine and inspection services and
the administration of this subsection. Amounts made
available under this subparagraph shall be available
until expended.
``(C) Excess fees.--Fees and other amounts
collected under this subsection in any of the fiscal
years 1996 through 2002 in excess of $100,000,000 shall
be available for the purposes specified in subparagraph
(B) until expended, without further appropriation.
``(6) Use of amounts collected after fiscal year 2002.--
After September 30, 2002, the unobligated balance in the
Agricultural Quarantine Inspection User Fee Account and fees
and other amounts collected under this subsection shall be
credited to the Department of Agriculture accounts that incur
the costs associated with the provision of agricultural
quarantine and inspection services and the administration of
this subsection. The fees and other amounts shall remain
available to the Secretary until expended without fiscal year
limitation.
``(7) Staff years.--The number of full-time equivalent
positions in the Department of Agriculture attributable to the
provision of agricultural quarantine and inspection services
and the administration of this subsection shall not be counted
toward the limitation on the total number of full-time
equivalent positions in all agencies specified in section 5(b)
of the Federal Workforce Restructuring Act of 1994 (Public Law
103-226; 5 U.S.C. 3101 note) or other limitation on the total
number of full-time equivalent positions.''.
SEC. 503. COMMODITY CREDIT CORPORATION INTEREST RATE.
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.
SEC. 504. ESTABLISHMENT OF OFFICE OF RISK MANAGEMENT.
(a) Establishment.--The Department of Agriculture Reorganization
Act of 1994 is amended by inserting after section 226 (7 U.S.C. 6932)
the following new section:
``SEC. 226A. OFFICE OF RISK MANAGEMENT.
``(a) Establishment.--Subject to subsection (e), the Secretary
shall establish and maintain in the Department an independent Office of
Risk Management.
``(b) Functions of the Office of Risk Management.--The Office of
Risk Management shall have jurisdiction over the following functions:
``(1) Supervision of the Federal Crop Insurance
Corporation.
``(2) Administration and oversight of all aspects,
including delivery through local offices of the Department, of
all programs authorized under the Federal Crop Insurance Act (7
U.S.C. 1501 et seq.).
``(3) Any pilot or other programs involving revenue
insurance, risk management savings accounts, or the use of the
futures market to manage risk and support farm income that may
be established under the Federal Crop Insurance Act or other
law.
``(4) Such other functions as the Secretary considers
appropriate.
``(c) Administrator.--
``(1) The Office of Risk Management shall be headed by an
Administrator who shall be appointed by the Secretary.
``(2) The Administrator of the Office of Risk Management
shall also serve as Manager of the Federal Crop Insurance
Corporation.
``(d) Resources.--
``(1) Functional coordination.--Certain functions of the
Office of Risk Management, such as human resources, public
affairs, and legislative affairs, may be provided by a
consolidation of such functions under the Under Secretary of
Agriculture for Farm and Foreign Agricultural Services.
``(2) Minimum provisions.--Notwithstanding paragraph (1) or
any other provision of law or order of the Secretary, the
Secretary shall provide the Office of Risk Management with
human and capital resources sufficient for the Office to carry
out its functions in a timely and efficient manner.''.
(b) Fiscal Year 1996 Funding.--Not less than $88,500,000 of the
appropriation provided for the salaries and expenses of the
Consolidated Farm Services Agency in the Agricultural, Rural
Development, Food and Drug Administration, and Related Agencies
Appropriations Act, 1996 shall be available for the salaries and
expenses of the Office of Risk Management established under subsection
(a).
(c) Conforming Amendment.--Section 226(b) of the Act (7 U.S.C.
6932(b)) is amended by striking paragraph (2).
SEC. 505. BUSINESS INTERRUPTION INSURANCE PROGRAM.
(a) Establishment of Program.--Not later than December 31, 1996,
the Secretary of Agriculture shall implement a program (to be known as
the ``Business Interruption Insurance Program''), under which the
producer of a contract commodity could elect to obtain revenue
insurance coverage to ensure that the producer receives an indemnity
payment if the producer suffers a loss of revenue. The nature and
extent of the program and the manner of determining the amount of an
indemnity payment shall be established by the Secretary.
(b) Report on Progress and Proposed Expansion.--Not later than
January 1, 1998, the Secretary shall submit to the Commission on 21st
Century Production Agriculture the data and results of the program
through October 1, 1997. In addition, the Secretary shall submit
information and recommendations to the Commission with respect to the
program that will serve as the basis for the Secretary to offer revenue
insurance to agricultural producers, at one or more levels of coverage,
that--
(1) is in addition to, or in lieu of, catastrophic and
higher levels of crop insurance;
(2) is offered through reinsurance arrangements with
private insurance companies;
(3) is actuarially sound; and
(4) requires the payment of premiums and administrative
fees by participating producers.
(c) Contract Commodity Defined.--In this section, the term
``contract commodity'' means a crop of wheat, corn, grain sorghum,
oats, barley, upland cotton, or rice.
SEC. 506. CONTINUATION OF OPTIONS PILOT PROGRAM.
During the 1996 through 2002 crop years, the Secretary of
Agriculture may continue to conduct the options pilot program
authorized by the Options Pilot Program Act of 1990 (subtitle E of
title XI of Public Law 101-624; 104 Stat. 3518; 7 U.S.C. 1421 note). To
the extent that the Secretary decides to continue the options pilot
program, the Secretary shall modify the terms and conditions of the
pilot program to reflect the changes to law made by this Act.
TITLE VI--COMMISSION ON 21ST CENTURY PRODUCTION AGRICULTURE
SEC. 601. ESTABLISHMENT.
There is hereby established a commission to be known as the
``Commission on 21st Century Production Agriculture'' (in this title
referred to as the ``Commission'').
SEC. 602. COMPOSITION.
(a) Membership and Appointment.--The Commission shall be composed
of 11 members, appointed as follows:
(1) Three members shall be appointed by the President.
(2) Four members shall be appointed by the Chairman of the
Committee on Agriculture of the House of Representatives in
consultation with the ranking minority member of the Committee.
(3) Four members shall be appointed by the Chairman of the
Committee on Agriculture, Nutrition, and Forestry of the Senate
in consultation with the ranking minority member of the
Committee.
(b) Qualifications.--At least one of the members appointed under
each of the paragraphs (1), (2), and (3) of subsection (a) shall be an
individual who is primarily involved in production agriculture. All
other members of the Commission shall be appointed from among
individuals having knowledge and experience in agricultural production,
marketing, finance, or trade.
(c) Term of Members; Vacancies.--Members of the Commission shall be
appointed for the life of the Commission. A vacancy on the Commission
shall not affect its powers, but shall be filled in the same manner as
the original appointment was made.
(d) Time for Appointment; First Meeting.--The members of the
Commission shall be appointed not later than October 1, 1997. The
Commission shall convene its first meeting to carry out its duties
under this Act 30 days after six members of the Commission have been
appointed.
(e) Chairman.--The chairman of the Commission shall be designated
jointly by the Chairman of the Committee on Agriculture of the House of
Representatives and the Chairman of the Committee on Agriculture,
Nutrition, and Forestry of the Senate from among the members of the
Commission.
SEC. 603. COMPREHENSIVE REVIEW OF PAST AND FUTURE OF PRODUCTION
AGRICULTURE.
(a) Initial Review.--The Commission shall conduct a comprehensive
review of changes in the condition of production agriculture in the
United States since the date of the enactment of this Act and the
extent to which such changes are the result of the amendments made by
this Act. The review shall include the following:
(1) An assessment of the initial success of production
flexibility contracts under section 103 in supporting the
economic viability of farming in the United States.
(2) An assessment of the food security situation in the
United States in the areas of trade, consumer prices,
international competitiveness of United States production
agriculture, food supplies, and humanitarian relief.
(3) An assessment of the changes in farmland values and
agricultural producer incomes since the date of the enactment
of this Act.
(4) An assessment of the extent to which regulatory relief
for agricultural producers has been enacted and implemented,
including the application of cost/benefit principles in the
issuance of agricultural regulations.
(5) An assessment of the extent to which tax relief for
agricultural producers has been enacted in the form of capital
gains tax reductions, estate tax exemptions, and mechanisms to
average tax loads over high and low income years.
(6) An assessment of the effect of any Government
interference in agricultural export markets, such as the
imposition of trade embargoes, and the degree of implementation
and success of international trade agreements.
(7) An assessment of the likely affect of the sale, lease,
or transfer of farm poundage quota for peanuts across State
lines.
(b) Subsequent Review.--The Commission shall conduct a
comprehensive review of the future of production agriculture in the
United States and the appropriate role of the Federal Government in
support of production agriculture. The review shall include the
following:
(1) An assessment of changes in the condition of production
agriculture in the United States since the initial review
conducted under subsection (a).
(2) Identification of the appropriate future relationship
of the Federal Government with production agriculture after
2002.
(3) An assessment of the personnel and infrastructure
requirements of the Department of Agriculture necessary to
support the future relationship of the Federal Government with
production agriculture.
(c) Recommendations.--In carrying out the subsequent review under
subsection (b), the Commission shall develop specific recommendations
for legislation to achieve the appropriate future relationship of the
Federal Government with production agriculture identified under
subsection (a)(2).
SEC. 604. REPORTS.
(a) Report on Initial Review.--Not later than June 1, 1998, the
Commission shall submit to the President, the Committee on Agriculture
of the House of Representatives, and the Committee on Agriculture,
Nutrition, and Forestry of the Senate a report containing the results
of the initial review conducted under section 603(a).
(b) Report on Subsequent Review.--Not later than January 1, 2001,
the Commission shall submit to the President and the congressional
committees specified in subsection (a) a report containing the results
of the subsequent review conducted under section 603(b).
SEC. 605. POWERS.
(a) Hearings.--The Commission may, for the purpose of carrying out
this Act, conduct such hearings, sit and act at such times, take such
testimony, and receive such evidence, as the Commission considers
appropriate.
(b) Assistance From Other Agencies.--The Commission may secure
directly from any department or agency of the Federal Government such
information as may be necessary for the Commission to carry out its
duties under this Act. Upon request of the chairman of the Commission,
the head of the department or agency shall, to the extent permitted by
law, furnish such information to the Commission.
(c) Mail.--The Commission may use the United States mails in the
same manner and under the same conditions as the departments and
agencies of the Federal Government.
(d) Assistance From Secretary.--The Secretary of Agriculture shall
provide to the Commission appropriate office space and such reasonable
administrative and support services as the Commission may request.
SEC. 606. COMMISSION PROCEDURES.
(a) Meetings.--The Commission shall meet on a regular basis (as
determined by the chairman) and at the call of the chairman or a
majority of its members.
(b) Quorum.--A majority of the members of the Commission shall
constitute a quorum for the transaction of business.
SEC. 607. PERSONNEL MATTERS.
(a) Compensation.--Each member of the Commission shall serve
without compensation, but shall be allowed travel expenses including
per diem in lieu of subsistence, as authorized by section 5703 of title
5, United States Code, when engaged in the performance of Commission
duties.
(b) Staff.--The Commission shall appoint a staff director, who
shall be paid at a rate not to exceed the maximum rate of basic pay
under section 5376 of title 5, United States Code, and such
professional and clerical personnel as may be reasonable and necessary
to enable the Commission to carry out its duties under this Act without
regard to the provisions of title 5, United States Code, governing
appointments in the competitive service, and without regard to the
provisions of chapter 51 and subchapter III of chapter 53 of such
title, or any other provision of law, relating to the number,
classification, and General Schedule rates. No employee appointed under
this subsection (other than the staff director) may be compensated at a
rate to exceed the maximum rate applicable to level GS-15 of the
General Schedule.
(c) Detailed Personnel.--Upon request of the chairman of the
Commission, the head of any department or agency of the Federal
Government is authorized to detail, without reimbursement, any
personnel of such department or agency to the Commission to assist the
Commission in carrying out its duties under this section. The detail of
any such personnel may not result in the interruption or loss of civil
service status or privilege of such personnel.
SEC. 608. TERMINATION OF COMMISSION.
The Commission shall terminate upon submission of the final report
required by section 604.
TITLE VII--EXTENSION OF CERTAIN AUTHORITIES
SEC. 701. EXTENSION OF AUTHORITY UNDER PUBLIC LAW 480.
Section 408 of the Agricultural Trade Development and Assistance
Act of 1954 (7 U.S.C. 1736b) is amended by striking ``1995'' and
inserting ``1996''.
SEC. 702. EXTENSION OF FOOD FOR PROGRESS PROGRAM.
Section 1110 of the Food Security Act of 1985 (7 U.S.C. 1736o),
also known as the Food for Progress Act of 1985, is amended--
(1) in subsection (k), by striking ``1995'' and inserting
``1996''; and
(2) in subsection (l), by striking ``1995'' and inserting
``1996''.
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