[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 281 Introduced in Senate (IS)]

113th CONGRESS
  1st Session
                                 S. 281

  To amend the Food Security Act of 1985 to restore integrity to and 
    strengthen payment limitation rules for commodity payments and 
                               benefits.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           February 12, 2013

 Mr. Grassley (for himself, Mr. Johnson of South Dakota, Mr. Enzi, and 
  Mr. Brown) introduced the following bill; which was read twice and 
   referred to the Committee on Agriculture, Nutrition, and Forestry

_______________________________________________________________________

                                 A BILL


 
  To amend the Food Security Act of 1985 to restore integrity to and 
    strengthen payment limitation rules for commodity payments and 
                               benefits.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Farm Program Integrity Act of 
2013''.

SEC. 2. PAYMENT LIMITATIONS.

    (a) In General.--Section 1001 of the Food Security Act of 1985 (7 
U.S.C. 1308) is amended--
            (1) in subsection (a), by striking paragraph (3) and 
        inserting the following:
            ``(3) Legal entity.--
                    ``(A) In general.--The term `legal entity' means--
                            ``(i) an organization that (subject to the 
                        requirements of this section and section 1001A) 
                        is eligible to receive a payment under a 
                        provision of law referred to in subsection (b), 
                        (c), or (d);
                            ``(ii) a corporation, joint stock company, 
                        association, limited partnership, limited 
                        liability company, limited liability 
                        partnership, charitable organization, estate, 
                        irrevocable trust, grantor of a revocable 
                        trust, or other similar entity (as determined 
                        by the Secretary); and
                            ``(iii) an organization that is 
                        participating in a farming operation as a 
                        partner in a general partnership or as a 
                        participant in a joint venture.
                    ``(B) Exclusion.--The term `legal entity' does not 
                include a general partnership or joint venture.'';
            (2) by striking subsections (b) through (d) and inserting 
        the following:
    ``(b) Limitation on Payments for Covered Commodities and Peanuts.--
The total amount of payments received, directly or indirectly, by a 
person or legal entity for any crop year for 1 or more covered 
commodities and peanuts under title I of the Food, Conservation, and 
Energy Act of 2008 (7 U.S.C. 8701 et seq.) (or a successor provision) 
may not exceed $125,000, of which--
            ``(1) not more than $75,000 may consist of marketing loan 
        gains and loan deficiency payments under subtitle B or C of 
        title I of the Food, Conservation, and Energy Act of 2008 (7 
        U.S.C. 8731 et seq.) (or a successor provision); and
            ``(2) not more than $50,000 may consist of any other 
        payments made for covered commodities and peanuts under title I 
        of the Food, Conservation, and Energy Act of 2008 (7 U.S.C. 
        8702 et seq.) (or a successor provision).
    ``(c) Spousal Equity.--
            ``(1) In general.--Notwithstanding subsection (b), except 
        as provided in paragraph (2), if a person and the spouse of the 
        person are covered by paragraph (2) and receive, directly or 
        indirectly, any payment or gain covered by this section, the 
        total amount of payments or gains (as applicable) covered by 
        this section that the person and spouse may jointly receive 
        during any crop year may not exceed an amount equal to twice 
        the applicable dollar amounts specified in subsection (b).
            ``(2) Exceptions.--
                    ``(A) Separate farming operations.--In the case of 
                a married couple in which each spouse, before the 
                marriage, was separately engaged in an unrelated 
                farming operation, each spouse shall be treated as a 
                separate person with respect to a farming operation 
                brought into the marriage by a spouse, subject to the 
                condition that the farming operation shall remain a 
                separate farming operation, as determined by the 
                Secretary.
                    ``(B) Election to receive separate payments.--A 
                married couple may elect to receive payments separately 
                in the name of each spouse if the total amount of 
                payments and benefits described in subsection (b) that 
                the married couple receives, directly or indirectly, 
                does not exceed an amount equal to twice the applicable 
                dollar amounts specified in those subsections.'';
            (3) in paragraph (3)(B) of subsection (f), by adding at the 
        end the following:
                            ``(iii) Irrevocable trusts.--In 
                        promulgating regulations to define the term 
                        `legal entity' as the term applies to 
                        irrevocable trusts, the Secretary shall ensure 
                        that irrevocable trusts are legitimate entities 
                        that have not been created for the purpose of 
                        avoiding a payment limitation.''; and
            (4) in subsection (h), in the second sentence, by striking 
        ``or other entity'' and inserting ``or legal entity''.
    (b) Conforming Amendments.--
            (1) Section 1001 of the Food Security Act of 1985 (7 U.S.C. 
        1308) is amended--
                    (A) in subsection (e), by striking ``subsections 
                (b) and (c)'' each place it appears in paragraphs (1) 
                and (3)(B) and inserting ``subsection (b)'';
                    (B) in subsection (f)--
                            (i) in paragraph (2), by striking 
                        ``Subsections (b) and (c)'' and inserting 
                        ``Subsection (b)'';
                            (ii) in paragraph (4)(B), by striking 
                        ``subsection (b) or (c)'' and inserting 
                        ``subsection (b)'';
                            (iii) in paragraph (5)--
                                    (I) in subparagraph (A), by 
                                striking ``subsection (d)''; and
                                    (II) in subparagraph (B), by 
                                striking ``subsection (b), (c), or 
                                (d)'' and inserting ``subsection (b)''; 
                                and
                            (iv) in paragraph (6)--
                                    (I) in subparagraph (A), by 
                                striking ``Notwithstanding subsection 
                                (d), except as provided in subsection 
                                (g)'' and inserting ``Except as 
                                provided in subsection (f)''; and
                                    (II) in subparagraph (B), by 
                                striking ``subsections (b), (c), and 
                                (d)'' and inserting ``subsection (b)'';
                    (C) in subsection (g)--
                            (i) in paragraph (1)--
                                    (I) by striking ``subsection 
                                (f)(6)(A)'' and inserting ``subsection 
                                (e)(6)(A)''; and
                                    (II) by striking ``subsection (b) 
                                or (c)'' and inserting ``subsection 
                                (b)''; and
                            (ii) in paragraph (2)(A), by striking 
                        ``subsections (b) and (c)'' and inserting 
                        ``subsection (b)''; and
                    (D) by redesignating subsections (e) through (h) as 
                subsections (d) through (g), respectively.
            (2) Section 1001A of the Food Security Act of 1985 (7 
        U.S.C. 1308-1) is amended--
                    (A) in subsection (a), by striking ``subsections 
                (b) and (c) of section 1001'' and inserting ``section 
                1001(b)''; and
                    (B) in subsection (b)(1), by striking ``subsection 
                (b) or (c) of section 1001'' and inserting ``section 
                1001(b)''.
            (3) Section 1001B(a) of the Food Security Act of 1985 (7 
        U.S.C. 1308-2(a)) is amended in the matter preceding paragraph 
        (1) by striking ``subsections (b) and (c) of section 1001'' and 
        inserting ``section 1001(b)''.
    (c) Application.--The amendments made by this section shall apply 
beginning with the 2014 crop year.

SEC. 3. PAYMENTS LIMITED TO ACTIVE FARMERS.

    Section 1001A of the Food Security Act of 1985 (7 U.S.C. 1308-1) is 
amended--
            (1) in subsection (b)(2)--
                    (A) by striking ``or active personal management'' 
                each place it appears in subparagraphs (A)(i)(II) and 
                (B)(ii); and
                    (B) in subparagraph (C), by striking ``, as applied 
                to the legal entity, are met by the legal entity, the 
                partners or members making a significant contribution 
                of personal labor or active personal management'' and 
                inserting ``are met by partners or members making a 
                significant contribution of personal labor, those 
                partners or members''; and
            (2) in subsection (c)--
                    (A) in paragraph (1)--
                            (i) by striking subparagraph (A) and 
                        inserting the following:
                    ``(A) the landowner share-rents the land at a rate 
                that is usual and customary;'';
                            (ii) in subparagraph (B), by striking the 
                        period at the end and inserting ``; and''; and
                            (iii) by adding at the end the following:
                    ``(C) the share of the payments received by the 
                landowner is commensurate with the share of the crop or 
                income received as rent.'';
                    (B) in paragraph (2)(A), by striking ``active 
                personal management or'';
                    (C) in paragraph (5)--
                            (i) by striking ``(5)'' and all that 
                        follows through ``(A) In general.--A person'' 
                        and inserting the following:
            ``(5) Custom farming services.--A person'';
                            (ii) by inserting ``under usual and 
                        customary terms'' after ``services''; and
                            (iii) by striking subparagraph (B); and
                    (D) by adding at the end the following:
            ``(7) Farm managers.--A person who otherwise meets the 
        requirements of this subsection other than (b)(2)(A)(i)(II) 
        shall be considered to be actively engaged in farming, as 
        determined by the Secretary, with respect to the farming 
        operation, including a farming operation that is a sole 
        proprietorship, a legal entity such as a joint venture or 
        general partnership, or a legal entity such as a corporation or 
        limited partnership, if the person--
                    ``(A) makes a significant contribution of 
                management to the farming operation necessary for the 
                farming operation, taking into account--
                            ``(i) the size and complexity of the 
                        farming operation; and
                            ``(ii) the management requirements normally 
                        and customarily required by similar farming 
                        operations;
                    ``(B)(i) is the only person in the farming 
                operation qualifying as actively engaged in farming by 
                using the farm manager special class designation under 
                this paragraph; and
                    ``(ii) together with any other persons in the 
                farming operation qualifying as actively engaged in 
                farming under subsection (b)(2) or as part of a special 
                class under this subsection, does not collectively 
                receive, directly or indirectly, an amount equal to 
                more than the applicable limits under section 1001(b);
                    ``(C) does not use the management contribution 
                under this paragraph to qualify as actively engaged in 
                more than 1 farming operation; and
                    ``(D) manages a farm operation that does not 
                substantially share equipment, labor, or management 
                with persons or legal entities that with the person 
                collectively receive, directly or indirectly, an amount 
                equal to more than the applicable limits under section 
                1001(b).''.
                                 <all>