[Congressional Record Volume 142, Number 42 (Monday, March 25, 1996)]
[House]
[Pages H2716-H2841]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     CONFERENCE REPORT ON H.R. 2854

  Mr. ROBERTS submitted the following conference report and statement 
on the bill (H.R. 2854), to modify the operation of certain 
agricultural programs:

                  Conference Report (H. Rept. 104-494)

       The committee of conference on the disagreeing votes of the 
     two Houses on the amendment of the Senate to the bill (H.R. 
     2854), to modify the operation of certain agricultural 
     programs, having met, after full and free conference, have 
     agreed to recommend and do recommend to their respective 
     Houses as follows:
       That the House recede from its disagreement to the 
     amendment of the Senate and agree to the same with an 
     amendment as follows:
       In lieu of the matter proposed to be inserted by the Senate 
     amendment, insert the following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Federal 
     Agriculture Improvement and Reform Act of 1996''.
       (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 ACT

           Subtitle A--Short Title, Purpose, and Definitions

Sec. 101. Short title and purpose.
Sec. 102. Definitions.

              Subtitle B--Production Flexibility Contracts

Sec. 111. Authorization for use of production flexibility contracts.
Sec. 112. Elements of contracts.
Sec. 113. Amounts available for contract payments.
Sec. 114. Determination of contract payments under contracts.
Sec. 115. Payment limitations.
Sec. 116. Violations of contract.
Sec. 117. Transfer or change of interest in lands subject to contract.
Sec. 118. Planting flexibility.

Subtitle C--Nonrecourse Marketing Assistance Loans and Loan Deficiency 
                                Payments

Sec. 131. Availability of nonrecourse marketing assistance loans.
Sec. 132. Loan rates for marketing assistance loans.
Sec. 133. Term of loans.
Sec. 134. Repayment of loans.
Sec. 135. Loan deficiency payments.
Sec. 136. Special marketing loan provisions for upland cotton.
Sec. 137. Availability of recourse loans for high moisture feed grains 
              and seed cotton.

                     Subtitle D--Other Commodities

                            Chapter 1--Dairy

Sec. 141. Milk price support program.
Sec. 142. Recourse loan program for commercial processors of dairy 
              products.
Sec. 143. Consolidation and reform of Federal milk marketing orders.
Sec. 144. Effect on fluid milk standards in State of California.
Sec. 145. Milk manufacturing marketing adjustment.
Sec. 146. Promotion.
Sec. 147. Northeast Interstate Dairy Compact.
Sec. 148. Dairy export incentive program.
Sec. 149. Authority to assist in establishment and maintenance of one 
              or more export trading companies.
Sec. 150. Standby authority to indicate entity best suited to provide 
              international market development and export services.
Sec. 151. Study and report regarding potential impact of Uruguay Round 
              on prices, income, and Government purchases.
Sec. 152. Promotion of United States dairy products in international 
              markets through dairy promotion program.

                      Chapter 2--Peanuts and Sugar

Sec. 155. Peanut program.
Sec. 156. Sugar program.

                       Subtitle E--Administration

Sec. 161. Administration.
Sec. 162. Adjustments of loans.

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Sec. 163. Commodity Credit Corporation interest rate.
Sec. 164. Personal liability of producers for deficiencies.
Sec. 165. Commodity Credit Corporation sales price restrictions.

             Subtitle F--Permanent Price Support Authority

Sec. 171. Suspension and repeal of permanent price support authority.
Sec. 172. Effect of amendments.

     Subtitle G--Commission on 21st Century Production Agriculture

Sec. 181. Establishment.
Sec. 182. Composition.
Sec. 183. Comprehensive review of past and future of production 
              agriculture.
Sec. 184. Reports.
Sec. 185. Powers.
Sec. 186. Commission procedures.
Sec. 187. Personnel matters.
Sec. 188. Termination of Commission.

             Subtitle H--Miscellaneous Commodity Provisions

Sec. 191. Options pilot program.
Sec. 192. Risk management education.
Sec. 193. Crop insurance.
Sec. 194. Establishment of Office of Risk Management.
Sec. 195. Revenue insurance.
Sec. 196. Administration and operation of noninsured crop assistance 
              program.

                      TITLE II--AGRICULTURAL TRADE

Subtitle A--Amendments to Agricultural Trade Development and Assistance 
                    Act of 1954 and Related Statutes

Sec. 201. Food aid to developing countries.
Sec. 202. Trade and development assistance.
Sec. 203. Agreements regarding eligible countries and private entities.
Sec. 204. Terms and conditions of sales.
Sec. 205. Use of local currency payment.
Sec. 206. Value-added foods.
Sec. 207. Eligible organizations.
Sec. 208. Generation and use of foreign currencies.
Sec. 209. General levels of assistance under Public Law 480.
Sec. 210. Food Aid Consultative Group.
Sec. 211. Support of nongovernmental organizations.
Sec. 212. Commodity determinations.
Sec. 213. General provisions.
Sec. 214. Agreements.
Sec. 215. Use of Commodity Credit Corporation.
Sec. 216. Administrative provisions.
Sec. 217. Expiration date.
Sec. 218. Regulations.
Sec. 219. Independent evaluation of programs.
Sec. 220. Authorization of appropriations. 
Sec. 221. Coordination of foreign assistance programs.
Sec. 222. Micronutrient fortification pilot program.
Sec. 223. Use of certain local currency.
Sec. 224. Farmer-to-farmer program.
Sec. 225. Food security commodity reserve.
Sec. 226. Protein byproducts derived from alcohol fuel production.
Sec. 227. Food for progress program.
Sec. 228. Use of foreign currency proceeds from export sales financing.
Sec. 229. Stimulation of foreign production.

        Subtitle B--Amendments to Agricultural Trade Act of 1978

Sec. 241. Agricultural export promotion strategy.
Sec. 242. Implementation of commitments under Uruguay Round Agreements.
Sec. 243. Export credits.
Sec. 244. Market access program.
Sec. 245. Export enhancement program.
Sec. 246. Arrival certification.
Sec. 247. Compliance.
Sec. 248. Regulations.
Sec. 249. Trade compensation and assistance programs.
Sec. 250. Foreign Agricultural Service.
Sec. 251. Reports.
Sec. 252. Foreign market development cooperator program.

        Subtitle C--Miscellaneous Agricultural Trade Provisions

Sec. 261. Edward R. Madigan United States Agricultural Export 
              Excellence Award.
Sec. 262. Reporting requirements relating to tobacco.
Sec. 263. Triggered export enhancement.
Sec. 264. Disposition of commodities to prevent waste.
Sec. 265. Debt-for-health-and-protection swap.
Sec. 266. Policy on expansion of international markets.
Sec. 267. Policy on maintenance and development of export markets.
Sec. 268. Policy on trade liberalization.
Sec. 269. Agricultural trade negotiations.
Sec. 270. Policy on unfair trade practices.
Sec. 271. Agricultural aid and trade missions.
Sec. 272. Annual reports by agricultural attaches.
Sec. 273. World livestock market price information.
Sec. 274. Orderly liquidation of stocks.
Sec. 275. Sales of extra long staple cotton.
Sec. 276. Regulations.
Sec. 277. Emerging markets.
Sec. 278. Reimbursement for overhead expenses.
Sec. 279. Labeling of domestic and imported lamb and mutton.
Sec. 280. Import assistance for CBI beneficiary countries and the 
              Philippines.
Sec. 281. Studies, reports, and other provisions.
Sec. 282. Sense of Congress concerning multilateral disciplines on 
              credit guarantees.
Sec. 283. International Cotton Advisory Committee.

                        TITLE III--CONSERVATION

                        Subtitle A--Definitions

Sec. 301. Definitions applicable to highly erodible cropland 
              conservation.

             Subtitle B--Highly Erodible Land Conservation

Sec. 311. Program ineligibility.
Sec. 312. Conservation reserve lands.
Sec. 313. Good faith exemption.
Sec. 314. Expedited procedures for granting variances from conservation 
              plans.
Sec. 315. Development and implementation of conservation plans and 
              conservation systems.
Sec. 316. Investigation of possible compliance deficiencies.
Sec. 317. Wind erosion estimation pilot project.

                    Subtitle C--Wetland Conservation

Sec. 321. Program ineligibility.
Sec. 322. Delineation of wetlands; exemptions to program ineligibility.
Sec. 323. Consultation and cooperation requirements.
Sec. 324. Application of program ineligibility to affiliated persons.
Sec. 325. Clarification of definition of agricultural lands in 
              memorandum of agreement.
Sec. 326. Effective date.

     Subtitle D--Environmental Conservation Acreage Reserve Program

Sec. 331. Environmental conservation acreage reserve program.
Sec. 332. Conservation reserve program.
Sec. 333. Wetlands reserve program.
Sec. 334. Environmental quality incentives program.
Sec. 335. Conservation farm option.
Sec. 336. Repeal of superseded authorities.

          Subtitle E--Conservation Funding and Administration

Sec. 341. Conservation funding and administration.
Sec. 342. State technical committees.
Sec. 343. Public notice and comment for revisions to certain State 
              technical guides.

     Subtitle F--National Natural Resources Conservation Foundation

Sec. 351. Short title.
Sec. 352. Definitions.
Sec. 353. National Natural Resources Conservation Foundation.
Sec. 354. Composition and operation.
Sec. 355. Officers and employees.
Sec. 356. Corporate powers and obligations of the Foundation.
Sec. 357. Administrative services and support.
Sec. 358. Audits and petition of Attorney General for equitable relief.
Sec. 359. Release from liability.
Sec. 360. Authorization of appropriations.

                          Subtitle G--Forestry

Sec. 371. Office of International Forestry.
Sec. 372. Cooperative work for protection, management, and improvement 
              of National Forest System.
Sec. 373. Forestry incentives program.
Sec. 374. Optional State grants for forest legacy program.

           Subtitle H--Miscellaneous Conservation Provisions

Sec. 381. Conservation activities of Commodity Credit Corporation.
Sec. 382. Floodplain easements.
Sec. 383. Resource conservation and development program.
Sec. 384. Repeal of report requirement.
Sec. 385. Flood risk reduction.
Sec. 386. Conservation of private grazing land.
Sec. 387. Wildlife habitat incentives program.
Sec. 388. Farmland protection program.
Sec. 389. Interim moratorium on bypass flows.
Sec. 390. Everglades ecosystem restoration.
Sec. 391. Agricultural air quality research oversight.

                     TITLE IV--NUTRITION ASSISTANCE

Sec. 401. Food stamp program.
Sec. 402. Commodity distribution program; commodity supplemental food 
              program.
Sec. 403. Emergency food assistance program.
Sec. 404. Soup kitchen and food bank program.
Sec. 405. National commodity processing.

                    TITLE V--AGRICULTURAL PROMOTION

             Subtitle A--Commodity Promotion and Evaluation

Sec. 501. Commodity promotion and evaluation.

Subtitle B--Issuance of Orders for Promotion, Research, and Information 
             Activities Regarding Agricultural Commodities

Sec. 511. Short title.
Sec. 512. Findings and purpose.
Sec. 513. Definitions.
Sec. 514. Issuance of orders.
Sec. 515. Required terms in orders.
Sec. 516. Permissive terms in orders.
Sec. 517. Assessments.
Sec. 518. Referenda.
Sec. 519. Petition and review of orders.
Sec. 520. Enforcement.
Sec. 521. Investigations and power to subpoena.
Sec. 522. Suspension or termination.
Sec. 523. Amendments to orders.
Sec. 524. Effect on other laws.
Sec. 525. Regulations.
Sec. 526. Authorization of appropriations.

                    Subtitle C--Canola and Rapeseed

Sec. 531. Short title.
Sec. 532. Findings and declaration of policy.
Sec. 533. Definitions.
Sec. 534. Issuance and amendment of orders.
Sec. 535. Required terms in orders.
Sec. 536. Assessments.
Sec. 537. Referenda.
Sec. 538. Petition and review.
Sec. 539. Enforcement.

[[Page H2718]]

Sec. 540. Investigations and power to subpoena.
Sec. 541. Suspension or termination.
Sec. 542. Regulations.
Sec. 543. Authorization of appropriations.

                         Subtitle D--Kiwifruit

Sec. 551. Short title.
Sec. 552. Findings and purposes.
Sec. 553. Definitions.
Sec. 554. Issuance of orders.
Sec. 555. National Kiwifruit Board.
Sec. 556. Required terms in order.
Sec. 557. Permissive terms in order.
Sec. 558. Petition and review.
Sec. 559. Enforcement.
Sec. 560. Investigations and power to subpoena.
Sec. 561. Referenda.
Sec. 562. Suspension or termination.
Sec. 563. Regulations.
Sec. 564. Authorization of appropriations.

                          Subtitle E--Popcorn

Sec. 571. Short title.
Sec. 572. Findings and declaration of policy.
Sec. 573. Definitions.
Sec. 574. Issuance of orders.
Sec. 575. Required terms in orders.
Sec. 576. Referenda.
Sec. 577. Petition and review.
Sec. 578. Enforcement.
Sec. 579. Investigations and power to subpoena.
Sec. 580. Relation to other programs.
Sec. 581. Regulations.
Sec. 582. Authorization of appropriations.

                       Subtitle F--Miscellaneous

Sec. 591. Maintenance of records for honey promotion program.

                            TITLE VI--CREDIT

                    Subtitle A--Farm Ownership Loans

Sec. 601. Limitation on direct farm ownership loans.
Sec. 602. Purposes of loans.
Sec. 603. Soil and water conservation and protection.
Sec. 604. Interest rate requirements.
Sec. 605. Insurance of loans.
Sec. 606. Loans guaranteed.

                      Subtitle B--Operating Loans

Sec. 611. Limitation on direct operating loans.
Sec. 612. Purposes of operating loans.
Sec. 613. Participation in loans.
Sec. 614. Line-of-credit loans.
Sec. 615. Insurance of operating loans.
Sec. 616. Special assistance for beginning farmers and ranchers.
Sec. 617. Limitation on period for which borrowers are eligible for 
              guaranteed assistance.

                      Subtitle C--Emergency Loans

Sec. 621. Hazard insurance requirement.
Sec. 622. Narrowing of authority to waive application of the credit 
              elsewhere test.
Sec. 623. Linking of emergency loans for crop or livestock changes to 
              natural disasters.
Sec. 624. Maximum emergency loan indebtedness.
Sec. 625. Establishment of date for emergency loan asset valuation.
Sec. 626. Insurance of emergency loans.

                 Subtitle D--Administrative Provisions

Sec. 631. Temporary authority to enter into contracts.
Sec. 632. Use of collection agencies.
Sec. 633. Notice of loan service programs.
Sec. 634. Clarification of written statement required of borrowers.
Sec. 635. Annual review of the credit history, business operation, and 
              continued eligibility of a borrower.
Sec. 636. Extension of veterans preference.
Sec. 637. Verification of the credit elsewhere test.
Sec. 638. Sale of property.
Sec. 639. Easements on inventoried property.
Sec. 640. Definitions.
Sec. 641. Authorization for loans.
Sec. 642. Contracts on loan security properties.
Sec. 643. List of certified lenders and inventory property 
              demonstration project.
Sec. 644. Homestead property.
Sec. 645. Restructuring.
Sec. 646. Transfer of inventory land for conservation purposes.
Sec. 647. Implementation of target participation rates.
Sec. 648. Delinquent borrowers.
Sec. 649. Short form certification of farm program borrower compliance.
Sec. 650. Credit study.

                     Subtitle E--General Provisions

Sec. 661. Conforming amendments.
Sec. 662. Electronic filing of effective financing statements under the 
              clear title provisions of the Food Security Act of 1985.
Sec. 663. Effective date.

                      TITLE VII--RURAL DEVELOPMENT

  Subtitle A--Amendments to the Food, Agriculture, Conservation, and 
                           Trade Act of 1990

                     Chapter 1--General Provisions

Sec. 701. Rural investment partnerships.
Sec. 702. Water and waste facility financing.
Sec. 703. Rural wastewater circuit rider program.
Sec. 704. Telemedicine and distance learning services in rural areas.
Sec. 705. Limitation on authorization of appropriations for rural 
              technology grants.
Sec. 706. Demonstration projects.
Sec. 707. Monitoring the economic progress of rural America.
Sec. 708. Analysis by Office of Technology Assessment.
Sec. 709. Rural health infrastructure improvement.
Sec. 710. Census of agriculture.
Sec. 711. Study of the transportation of fertilizer and agricultural 
              chemicals to farmers.

   Chapter 2--Alternative Agricultural Research and Commercialization

Sec. 721. Definitions.
Sec. 722. Alternative Agricultural Research and Commercialization 
              Corporation.
Sec. 723. Board of directors, employees, and facilities.
Sec. 724. Research and development grants, contracts, and agreements.
Sec. 725. Commercialization assistance.
Sec. 726. General rules regarding the provision of assistance.
Sec. 727. Regional centers.
Sec. 728. Alternative Agricultural Research and Commercialization 
              Revolving Fund.
Sec. 729. Procurement preferences for products receiving Corporation 
              assistance.
Sec. 730. Business plan and feasibility study and report.

 Subtitle B--Amendments to the Consolidated Farm and Rural Development 
                                  Act

                     Chapter 1--General Provisions

Sec. 741. Water and waste facility loans and grants.
Sec. 742. Emergency community water assistance grant program for small 
              communities.
Sec. 743. Emergency community water assistance grant program for 
              smallest communities.
Sec. 744. Agricultural Credit Insurance Fund.
Sec. 745. Rural Development Insurance Fund.
Sec. 746. Insured watershed and resource conservation and development 
              loans.
Sec. 747. Rural industrialization assistance.
Sec. 748. Administration.
Sec. 749. Authorization of appropriations.
Sec. 750. Testimony before congressional committees.
Sec. 751. Prohibition on use of loans for certain purposes.
Sec. 752. Rural development certified lenders program.
Sec. 753. System for delivery of certain rural development programs.
Sec. 754. State rural economic development review panel.
Sec. 755. Limited transfer authority of loan amounts.
Sec. 756. Allocation and transfer of loan guarantee authority.
Sec. 757. Water systems for rural and Native villages in Alaska.
Sec. 758. Application requirements relating to water and waste disposal 
              loan and grant programs.
Sec. 759. National Sheep Industry Improvement Center.
Sec. 759A. Cooperative agreements.
Sec. 759B. Eligibility for grants to broadcasting systems.

             Chapter 2--Rural Community Advancement Program

Sec. 761. Rural community advancement program.
Sec. 762. Simplified, uniform application for assistance from all 
              Federal rural development programs.
Sec. 763. Community facilities grant program.

    Subtitle C--Amendments to the Rural Electrification Act of 1936

Sec. 771. Purposes; investigations and reports.
Sec. 772. Authorization of appropriations.
Sec. 773. Loans for electrical plants and transmission lines.
Sec. 774. Loans for electrical and plumbing equipment.
Sec. 775. Testimony on budget requests.
Sec. 776. Transfer of functions of administration created by Executive 
              order.
Sec. 777. Annual report.
Sec. 778. Prohibition on restricting water and waste facility services 
              to electric customers.
Sec. 779. Telephone loan terms and conditions.
Sec. 780. Privatization program.
Sec. 781. Rural Business Incubator Fund.

         Subtitle D--Miscellaneous Rural Development Provisions

Sec. 791. Interest rate formula.
Sec. 792. Grants for financially stressed farmers, dislocated farmers, 
              and rural families.
Sec. 793. Fund for Rural America.
Sec. 794. Under Secretary of Agriculture for Rural Economic and 
              Community Development renamed the Under Secretary of 
              Agriculture for Rural Development.

             TITLE VIII--RESEARCH, EXTENSION, AND EDUCATION

  Subtitle A--Modification and Extension of Activities Under 1977 Act

Sec. 801. Purposes of agricultural research, extension, and education.
Sec. 802. National Agricultural Research, Extension, Education, and 
              Economics Advisory Board.
Sec. 803. Federal Advisory Committee Act exemption for Federal-State 
              cooperative programs.
Sec. 804. Coordination and planning of agricultural research, 
              extension, and education.
Sec. 805. Grants and fellowships for food and agricultural sciences 
              education.
Sec. 806. Grants for research on the production and marketing of 
              alcohols and industrial hydrocarbons from agricultural 
              commodities and forest products.
Sec. 807. Policy research centers.
Sec. 808. Human nutrition intervention and health promotion research 
              program.

[[Page H2719]]

Sec. 809. Food and nutrition education program.
Sec. 810. Purposes and findings relating to animal health and disease 
              research.
Sec. 811. Animal health and disease continuing research.
Sec. 812. Animal health and disease national or regional research.
Sec. 813. Grant program to upgrade agricultural and food sciences 
              facilities at 1890 land-grant colleges.
Sec. 814. National research and training centennial centers.
Sec. 815. Programs for Hispanic-serving institutions.
Sec. 816. International agricultural research and extension.
Sec. 817. Authorization of appropriations for agricultural research 
              programs.
Sec. 818. Authorization of appropriations for extension education.
Sec. 819. Supplemental and alternative crops research.
Sec. 820. Aquaculture assistance programs.
Sec. 821. Authorization of appropriations for rangeland research.

  Subtitle B--Modification and Extension of Activities Under 1990 Act

Sec. 831. Water quality research, education, and coordination.
Sec. 832. National genetics resources program.
Sec. 833. National agricultural weather information system.
Sec. 834. Livestock product safety and inspection program.
Sec. 835. Plant genome mapping program.
Sec. 836. Certain specialized research programs.
Sec. 837. Agricultural telecommunications program.
Sec. 838. National centers for agricultural product quality research.
Sec. 839. Red meat safety research center.
Sec. 840. Indian reservation extension agent program.
Sec. 841. Assistive technology program for farmers with disabilities.
Sec. 842. National rural information center clearinghouse.
Sec. 843. Global climate change.

        Subtitle C--Repeal of Certain Activities and Authorities

Sec. 851. Subcommittee on Food, Agricultural, and Forestry Research.
Sec. 852. Joint Council on Food and Agricultural Sciences.
Sec. 853. Agricultural Science and Technology Review Board.
Sec. 854. Animal Health Science Research Advisory Board.
Sec. 855. Resident instruction program at 1890 land-grant colleges.
Sec. 856. Grants to States for international trade development centers.
Sec. 857. Rangeland research.
Sec. 858. Composting research and extension program.
Sec. 859. Education program regarding handling of agricultural 
              chemicals and agricultural chemical containers.
Sec. 860. Program administration regarding sustainable agriculture 
              research and education.
Sec. 861. Research regarding production, preparation, processing, 
              handling, and storage of agricultural products.
Sec. 862. Plant and animal pest and disease control program.
Sec. 863. Certain specialized research programs.
Sec. 864. Commission on agricultural research facilities.
Sec. 865. Special grant to study constraints on agricultural trade.
Sec. 866. Pilot project to coordinate food and nutrition education 
              programs.
Sec. 867. Demonstration areas for rural economic development.
Sec. 868. Technical advisory committee regarding global climate change.
Sec. 869. Committee of nine under Hatch Act of 1887.
Sec. 870. Cotton crop reports.
Sec. 871. Rural economic and business development and additional 
              research grants under title V of Rural Development Act of 
              1972.
Sec. 872. Human nutrition research.
Sec. 873. Grants to upgrade 1890 land-grant college extension 
              facilities.
Sec. 874. Indian subsistence farming demonstration grant program.

             Subtitle D--Miscellaneous Research Provisions

Sec. 881. Critical agricultural materials research.
Sec. 882. Memorandum of agreement regarding 1994 Institutions.
Sec. 883. Smith-Lever Act funding for 1890 land-grant colleges, 
              including Tuskegee University.
Sec. 884. Agricultural research facilities.
Sec. 885. National competitive research initiative.
Sec. 886. Rural development research and education.
Sec. 887. Dairy goat research program.
Sec. 888. Competitive grants for research to eradicate and control 
              brown citrus aphid and citrus tristeza virus.
Sec. 889. Stuttgart National Aquaculture Research Center.
Sec. 890. Expansion of authorities related to National Arboretum.
Sec. 891. Transfer of aquacultural research center.
Sec. 892. Use of remote sensing data and other data to anticipate 
              potential food, feed, and fiber shortages or excesses and 
              to provide timely information to assist farmers with 
              planting decisions.
Sec. 893. Sense of Senate regarding methyl bromide alternative research 
              and extension activities.

         Subtitle E--Research Authority After Fiscal Year 1997

Sec. 897. Authorization of appropriations.
Sec. 898. Activities subject to availability of appropriations.

                        TITLE IX--MISCELLANEOUS

     Subtitle A--Commercial Transportation of Equine for Slaughter

Sec. 901. Findings.
Sec. 902. Definitions.
Sec. 903. Regulation of commercial transportation of equine for 
              slaughter.
Sec. 904. Limitation of authority to equine for slaughter.
Sec. 905. Effective date.

                     Subtitle B--General Provisions

Sec. 911. Interstate quarantine.
Sec. 912. Cotton classification services.
Sec. 913. Plant variety protection for certain tuber propagated plant 
              varieties.
Sec. 914. Swine health protection.
Sec. 915. Designation of Mount Pleasant National Scenic Area.
Sec. 916. Pseudorabies eradication program.
Sec. 917. Collection and use of agricultural quarantine and inspection 
              fees.
Sec. 918. Meat and poultry inspection.
Sec. 919. Reimbursable agreements.
Sec. 920. Overseas tort claims.
Sec. 921. Operation of Graduate School of Department of Agriculture as 
              nonappropriated fund instrumentality.
Sec. 922. Student internship programs.
Sec. 923. Conveyance of excess Federal personal property.
Sec. 924. Conveyance of land to White Oak Cemetery.
Sec. 925. Sale of land by the University of Arkansas.
Sec. 926. Designation of Dale Bumpers Small Farms Research Center.
Sec. 927. Department of Agriculture Washington Area Strategic Space 
              Plan.
Sec. 928. Severability.
              TITLE I--AGRICULTURAL MARKET TRANSITION ACT
           Subtitle A--Short Title, Purpose, and Definitions

     SEC. 101. SHORT TITLE AND PURPOSE.

       (a) Short Title.--This title may be cited as the 
     ``Agricultural Market Transition Act''.
       (b) 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 and 
     wetland protection requirements;
       (2) to make nonrecourse marketing assistance loans and loan 
     deficiency payments available for certain crops;
       (3) to improve the operation of farm programs for milk, 
     peanuts, and sugar; and
       (4) to establish a commission to undertake a comprehensive 
     review of past and future production agriculture in the 
     United States.

     SEC. 102. DEFINITIONS.

       In this title:
       (1) Agricultural act of 1949.--Except in section 171, the 
     term ``Agricultural Act of 1949'' means the Agricultural Act 
     of 1949 (7 U.S.C. 1421 et seq.), as in effect prior to the 
     suspensions under section 171(b)(1).
       (2) Considered planted.--The term ``considered planted'' 
     means acreage that is considered planted under title V of the 
     Agricultural Act of 1949 (7 U.S.C. 1461 et seq.) and such 
     other acreage as the Secretary considers fair and equitable.
       (3) Contract.--The terms ``contract'' and ``production 
     flexibility contract'' mean a production flexibility contract 
     entered into under section 111.
       (4) Contract acreage.--The term ``contract acreage'' means 
     1 or more crop acreage bases established for contract 
     commodities under title V of the Agricultural Act of 1949 (7 
     U.S.C. 1461 et seq.) that would have been in effect for the 
     1996 crop (but for suspension under section 171(b)(1)).
       (5) Contract commodity.--The term ``contract commodity'' 
     means wheat, corn, grain sorghum, barley, oats, upland 
     cotton, and rice.
       (6) Contract payment.--The term ``contract payment'' means 
     a payment made under this subtitle pursuant to a contract.
       (7) Department.--The term ``Department'' means the 
     Department of Agriculture.
       (8) Extra long staple cotton.--The term ``extra long staple 
     cotton'' means cotton that--
       (A) is produced from pure strain varieties of the 
     Barbadense species or any hybrid thereof, or other similar 
     types of extra long staple cotton, designated by the 
     Secretary, having characteristics needed for various end uses 
     for which United States upland cotton is not suitable and 
     grown in irrigated cotton-growing regions of the United 
     States designated by the Secretary or other areas designated 
     by the Secretary as suitable for the production of the 
     varieties or types; and
       (B) is ginned on a roller-type gin or, if authorized by the 
     Secretary, ginned on another type gin for experimental 
     purposes.
       (9) Farm program payment yield.--The term ``farm program 
     payment yield'' means the farm program payment yield 
     established for the 1995 crop of a contract commodity under 
     section 505 of the Agricultural Act of 1949 (7 U.S.C. 1465). 
     The Secretary shall adjust the farm program payment yield for 
     the 1995 crop of a contract commodity to account for any 
     additional yield payments made with respect to that crop 
     under subsection (b)(2) of the section.

[[Page H2720]]

       (10) Loan commodity.--The term ``loan commodity'' means 
     each contract commodity, extra long staple cotton, and 
     oilseed.
       (11) Oilseed.--The term ``oilseed'' means a crop of 
     soybeans, sunflower seed, rapeseed, canola, safflower, 
     flaxseed, mustard seed, or, if designated by the Secretary, 
     other oilseeds.
       (12) Producer.--The term ``producer'' means an owner, 
     operator, landlord, tenant, or sharecropper who shares in the 
     risk of producing a crop and who is entitled to share in the 
     crop available for marketing from the farm, or would have 
     shared had the crop been produced. In determining whether a 
     grower of hybrid seed is a producer, the Secretary shall not 
     take into consideration the existence of a hybrid seed 
     contract.
       (13) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (14) State.--The term ``State'' means each of the several 
     States of the United States, the District of Columbia, the 
     Commonwealth of Puerto Rico, and any other territory or 
     possession of the United States.
       (15) United states.--The term ``United States'', when used 
     in a geographical sense, means all of the States.
              Subtitle B--Production Flexibility Contracts

     SEC. 111. AUTHORIZATION FOR USE OF PRODUCTION FLEXIBILITY 
                   CONTRACTS.

       (a) Offer and Terms.--The Secretary shall offer to enter 
     into a production flexibility contract with an eligible owner 
     or producer described in subsection (b) on a farm containing 
     eligible cropland. Under the terms of a contract, the owner 
     or producer shall agree, in exchange for annual contract 
     payments, to--
       (1) comply with applicable conservation requirements under 
     subtitle B of title XII of the Food Security Act of 1985 (16 
     U.S.C. 3811 et seq.);
       (2) comply with applicable wetland protection requirements 
     under subtitle C of title XII of the Act (16 U.S.C. 3821 et 
     seq.);
       (3) comply with the planting flexibility requirements of 
     section 118; and
       (4) use the land subject to the contract for an 
     agricultural or related activity, but not for a 
     nonagricultural commercial or industrial use, as determined 
     by the Secretary.
       (b) Eligible Owners and Producers Described.--The following 
     producers and owners shall be eligible to enter into a 
     contract:
       (1) An owner of eligible cropland who assumes all or a part 
     of the risk of producing a crop.
       (2) A producer (other than an owner) on eligible cropland 
     with a share-rent lease of the eligible cropland, regardless 
     of the length of the lease, if the owner enters into the same 
     contract.
       (3) A producer (other than an owner) on eligible cropland 
     who cash rents the eligible cropland under a lease expiring 
     on or after September 30, 2002, in which case the owner is 
     not required to enter into the contract.
       (4) A producer (other than an owner) on eligible cropland 
     who cash rents the eligible cropland under a lease expiring 
     before September 30, 2002. The owner of the eligible cropland 
     may also enter into the same contract. If the producer elects 
     to enroll less than 100 percent of the eligible cropland in 
     the contract, the consent of the owner is required.
       (5) An owner of eligible cropland who cash rents the 
     eligible cropland and the lease term expires before September 
     30, 2002, if the tenant declines to enter into a contract. In 
     the case of an owner covered by this paragraph, contract 
     payments shall not begin under a contract until the lease 
     held by the tenant ends.
       (6) An owner or producer described in any preceding 
     paragraph regardless of whether the owner or producer 
     purchased catastrophic risk protection for a 1996 crop under 
     section 508(b) of the Federal Crop Insurance Act (7 U.S.C. 
     1508(b)).
       (c) Tenants and Sharecroppers.--In carrying out this 
     subtitle, the Secretary shall provide adequate safeguards to 
     protect the interests of tenants and sharecroppers.
       (d) Eligible Cropland Described.--Land shall be considered 
     to be cropland eligible for coverage under a contract only if 
     the land has contract acreage attributable to the land and--
       (1) for at least 1 of the 1991 through 1995 crops, at least 
     a portion of the land was enrolled in the acreage reduction 
     program authorized for a crop of a contract commodity under 
     section 101B, 103B, 105B, or 107B of the Agricultural Act of 
     1949 or was considered planted;
       (2) was subject to a conservation reserve contract under 
     section 1231 of the Food Security Act of 1985 (16 U.S.C. 
     3831) whose term expired, or was voluntarily terminated, on 
     or after January 1, 1995; or
       (3) is released from coverage under a conservation reserve 
     contract by the Secretary during the period beginning on 
     January 1, 1995, and ending on the date specified in section 
     112(a)(2).
       (e) Quantity of Eligible Cropland Covered by Contract.--
     Subject to subsection (b)(4), an owner or producer may enroll 
     as contract acreage all or a portion of the eligible cropland 
     on the farm.
       (f) Voluntary Reduction in Contract Acreage.--Subject to 
     subsection (b)(4), an owner or producer who enters into a 
     contract may subsequently reduce the quantity of contract 
     acreage covered by the contract.

     SEC. 112. ELEMENTS OF CONTRACTS.

       (a) Time for Contracting.--
       (1) Commencement.--To the extent practicable, the Secretary 
     shall commence entering into contracts not later than 45 days 
     after the date of enactment of this title.
       (2) Deadline.--Except as provided in paragraph (3), the 
     Secretary may not enter into a contract after August 1, 1996.
       (3) Conservation reserve lands.--
       (A) In general.--At the beginning of each fiscal year, the 
     Secretary shall allow an eligible owner or producer on a farm 
     covered by a conservation reserve contract entered into under 
     section 1231 of the Food Security Act of 1985 (16 U.S.C. 
     3831) that terminates after the date specified in paragraph 
     (2) to enter into or expand a production flexibility contract 
     to cover the contract acreage of the farm that was subject to 
     the former conservation reserve contract.
       (B) Amount.--Contract payments made for contract acreage 
     under this paragraph shall be made at the rate and amount 
     applicable to the annual contract payment level for the 
     applicable crop. For the fiscal year in which the 
     conservation reserve contract is terminated, the owner or 
     producer subject to the production flexibility contract may 
     elect to receive either contract payments or a prorated 
     payment under the conservation reserve contract, but not 
     both.
       (b) Duration of Contract.--
       (1) Beginning date.--The term of a contract shall begin 
     with--
       (A) the 1996 crop of a contract commodity; or
       (B) in the case of acreage that was subject to a 
     conservation reserve contract described in subsection (a)(3), 
     the date the production flexibility contract was entered into 
     or expanded to cover the acreage.
       (2) Ending date.--The term of a contract shall extend 
     through the 2002 crop, unless earlier terminated by the owner 
     or producer.
       (c) Estimation of Contract Payments.--At the time the 
     Secretary enters into a contract, the Secretary shall provide 
     an estimate of the minimum contract payments anticipated to 
     be made during at least the first fiscal year for which 
     contract payments will be made.
       (d) Time for Payment.--
       (1) In general.--An annual contract payment shall be made 
     not later than September 30 of each of fiscal years 1996 
     through 2002.
       (2) Advance payments.--
       (A) Fiscal year 1996.--At the option of the owner or 
     producer, 50 percent of the contract payment for fiscal year 
     1996 shall be made not later than 30 days after the date on 
     which the contract is entered into and approved by the 
     Secretary and the owner or producer.
       (B) Subsequent fiscal years.--At the option of the owner or 
     producer for fiscal year 1997 and each subsequent fiscal 
     year, 50 percent of the annual contract payment shall be made 
     on December 15 or January 15 of the fiscal year. The owner or 
     producer may change the date selected under this subparagraph 
     for a subsequent fiscal year by providing advance notice to 
     the Secretary.

     SEC. 113. AMOUNTS AVAILABLE FOR CONTRACT PAYMENTS.

       (a) Fiscal Year Amounts.--The Secretary shall, to the 
     maximum extent practicable, expend the following amounts to 
     satisfy the obligations of the Secretary under all contracts:
       (1) For fiscal year 1996, $5,570,000,000.
       (2) For fiscal year 1997, $5,385,000,000.
       (3) For fiscal year 1998, $5,800,000,000.
       (4) For fiscal year 1999, $5,603,000,000.
       (5) For fiscal year 2000, $5,130,000,000.
       (6) For fiscal year 2001, $4,130,000,000.
       (7) For fiscal year 2002, $4,008,000,000.
       (b) Allocation.--The amount made available for a fiscal 
     year under subsection (a) shall be allocated as follows:
       (1) For wheat, 26.26 percent.
       (2) For corn, 46.22 percent.
       (3) For grain sorghum, 5.11 percent.
       (4) For barley, 2.16 percent.
       (5) For oats, 0.15 percent.
       (6) For upland cotton, 11.63 percent.
       (7) For rice, 8.47 percent.
       (c) Adjustment.--The Secretary shall adjust the amounts 
     allocated for each contract commodity under subsection (b) 
     for a particular fiscal year by--
       (1) adding an amount equal to the sum of all repayments of 
     deficiency payments required under section 114(a)(2) of the 
     Agricultural Act of 1949 (7 U.S.C. 1445j(a)(2)) for the 
     commodity;
       (2) adding an amount equal to the sum of all refunds of 
     contract payments received during the preceding fiscal year 
     under section 116 for the commodity; and
       (3) subtracting an amount equal to the amount, if any, 
     necessary during that fiscal year to satisfy payment 
     requirements for the commodity under sections 103B, 105B, or 
     107B of the Agricultural Act of 1949 for the 1994 and 1995 
     crop years.
       (d) Additional Rice Allocation.--In addition to the 
     adjustments required under subsection (c), the amount 
     allocated under subsection (b) for rice contract payments 
     shall be increased by $8,500,000 for each of fiscal years 
     1997 through 2002.
       (e) Exclusion of Certain Amounts From Contract Payments.--
     Any amount added pursuant to paragraphs (1) and (2) of 
     subsection (c) to the amount available under subsection (a) 
     for a fiscal year and paid to owners and producers under a 
     contract shall not be treated as a contract payment for 
     purposes of section 115(a) of this title or section 1001(1) 
     of the Food Security Act of 1985 (7 U.S.C. 1308(1)). However, 
     the amount of a payment covered by this subsection may not 
     exceed $50,000 per person.
       (f) Effect of Payment Limitation.--The amount available 
     under subsection (a) for a fiscal year shall be reduced by an 
     amount equal to the total amount of contract payments for the 
     fiscal year that owners and producers forgo as a result of 
     operation of the payment limitation under section 1001(1) of 
     the Food Security Act of 1985 (7 U.S.C. 1308(1)).

     SEC. 114. DETERMINATION OF CONTRACT PAYMENTS UNDER CONTRACTS.

       (a) Individual Payment Quantity of Contract Commodities.--
     For each contract, the payment quantity of a contract 
     commodity for each fiscal year shall be equal to the product 
     of--
       (1) 85 percent of the contract acreage; and

[[Page H2721]]

       (2) the farm program payment yield.
       (b) Annual Payment Quantity of Contract Commodities.--The 
     payment quantity of each contract commodity covered by all 
     contracts for each fiscal year shall be equal to the sum of 
     the amounts calculated under subsection (a) for each 
     individual contract.
       (c) Annual Payment Rate.--The payment rate for a contract 
     commodity for each fiscal year shall be equal to--
       (1) the amount made available under section 113 for the 
     contract commodity for the fiscal year; divided by
       (2) the amount determined under subsection (b) for the 
     fiscal year.
       (d) Annual Payment Amount.--The amount to be paid under a 
     contract in effect for each fiscal year with respect to all 
     contract commodities covered by the contract shall be equal 
     to the sum of the products of--
       (1) the payment quantity determined under subsection (a) 
     for each of the contract commodities covered by the contract; 
     and
       (2) the corresponding payment rate for the contract 
     commodity in effect under subsection (c).
       (e) Reduction in Payment Amount.--The contract payment 
     determined under subsection (d) for an owner or producer for 
     a fiscal year shall be immediately reduced by the amount of 
     any repayment of deficiency payments that is required under 
     section 114(a)(2) of the Agricultural Act of 1949 (7 U.S.C. 
     1445j(a)(2)) and is not repaid as of the date the contract 
     payment is determined. The Secretary shall be required to 
     collect the required repayment, or any claim based on the 
     required repayment, as soon as the contract payment is 
     determined.
       (f) Assignment of Contract Payments.--The provisions of 
     section 8(g) of the Soil Conservation and Domestic Allotment 
     Act (16 U.S.C. 590h(g)) (relating to assignment of payments) 
     shall apply to contract payments under this section. The 
     owner or producer making the assignment, or the assignee, 
     shall provide the Secretary with notice, in such manner as 
     the Secretary may require in the contract, of any assignment 
     made under this subsection.
       (g) Sharing of Contract Payments.--The Secretary shall 
     provide for the sharing of contract payments among the owners 
     and producers subject to the contract on a fair and equitable 
     basis.

     SEC. 115. PAYMENT LIMITATIONS.

       (a) Applicability of Payment Limitations.--Sections 1001 
     through 1001C of the Food Security Act of 1985 (7 U.S.C. 1308 
     through 1308-3), as amended by this section, shall be 
     applicable to contract payments made under this subtitle.
       (b) Payment Limitations.--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 
     the Agricultural Market Transition Act to a person under 1 or 
     more production flexibility contracts during any fiscal year 
     may not exceed $40,000.
       ``(2) Limitation on marketing loan gains and loan 
     deficiency payments.--The total amount of the payments 
     specified in paragraph (3) that a person shall be entitled to 
     receive under the Agricultural Market Transition Act for 1 or 
     more contract commodities and oilseeds during any crop year 
     may not exceed $75,000.
       ``(3) Description of payments subject to limitation.--The 
     payments referred to in paragraph (2) are the following:
       ``(A) Any gain realized by a producer from repaying a 
     marketing assistance loan under section 131 of the 
     Agricultural Market Transition Act for a crop of any loan 
     commodity at a lower level than the original loan rate 
     established for the loan commodity under section 132 of the 
     Act.
       ``(B) Any loan deficiency payment received for a loan 
     commodity under section 135 of the Act.
       ``(4) Definitions.--In this title, the terms `contract 
     commodity', `contract payment', `loan commodity', `oilseed', 
     and `production flexibility contract' have the meaning given 
     those terms in section 102 of the Agricultural Market 
     Transition Act.''.
       (c) 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 the 
     Agricultural Market Transition Act,''; and
       (C) by striking ``during the 1989 through 1997 crop 
     years''.

     SEC. 116. VIOLATIONS OF CONTRACT.

       (a) Termination of Contract For Violation.--Except as 
     provided in subsection (b), if an owner or producer subject 
     to a contract violates a requirement of the contract 
     specified in section 111(a), the Secretary shall terminate 
     the contract with respect to the owner or producer on each 
     farm in which the owner or producer has an interest. On the 
     termination, the owner or producer shall forfeit all rights 
     to receive future contract payments on each farm in which the 
     owner or producer has an interest and shall refund to the 
     Secretary all contract payments received by the owner or 
     producer during the period of the violation, together with 
     interest on the contract payments as determined by the 
     Secretary.
       (b) Refund or Adjustment.--If the Secretary determines that 
     a violation does not warrant termination of the contract 
     under subsection (a), the Secretary may require the owner or 
     producer subject to the contract--
       (1) to refund to the Secretary that part of the contract 
     payments received by the owner or producer during the period 
     of the violation, together with interest on the contract 
     payments as determined by the Secretary; or
       (2) 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.
       (c) Foreclosure.--
       (1) Effect of foreclosure.--An owner or producer 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 to 
     provide fair and equitable treatment.
       (2) Resumption of operation.--This subsection shall not 
     void the responsibilities of the owner or producer under the 
     contract if the owner or producer 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 producer, the provisions of the contract in 
     effect on the date of the foreclosure shall apply.
       (d) Review.--A determination of the Secretary under this 
     section shall be considered to be an adverse decision for 
     purposes of the availability of administrative review of the 
     determination.

     SEC. 117. TRANSFER OR CHANGE OF INTEREST IN LANDS SUBJECT TO 
                   CONTRACT.

       (a) Termination.--Except as provided in subsection (c), a 
     transfer of (or change in) the interest of an owner or 
     producer subject to a contract in the contract acreage 
     covered by the contract shall result in the termination of 
     the contract with respect to the acreage, unless the 
     transferee or owner of the acreage agrees to assume all 
     obligations under the contract. The termination shall be 
     effective on the date of the transfer or change.
       (b) Modification.--At the request of the transferee or 
     owner, the Secretary may modify the contract if the 
     modifications are consistent with the objectives of this 
     subtitle, as determined by the Secretary.
       (c) Exception.--If an owner or producer 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.

     SEC. 118. PLANTING FLEXIBILITY.

       (a) Permitted Crops.--Subject to subsection (b), any 
     commodity or crop may be planted on contract acreage on a 
     farm.
       (b) Limitations and Exceptions Regarding Fruits and 
     Vegetables.--
       (1) Limitations.--The planting of fruits and vegetables 
     (other than lentils, mung beans, and dry peas) shall be 
     prohibited on contract acreage.
       (2) Exceptions.--Paragraph (1) shall not limit the planting 
     of a fruit or vegetable--
       (A) in any region in which there is a history of double-
     cropping of contract commodities with fruits or vegetables, 
     as determined by the Secretary, in which case the double-
     cropping shall be permitted;
       (B) on a farm that the Secretary determines has a history 
     of planting fruits or vegetables on contract acreage, except 
     that a contract payment shall be reduced by an acre for each 
     acre planted to the fruit or vegetable; or
       (C) by a producer who the Secretary determines has an 
     established planting history of a specific fruit or 
     vegetable, except that--
       (i) the quantity planted may not exceed the producer's 
     average annual planting history of the fruit or vegetable in 
     the 1991 through 1995 crop years (excluding any crop year in 
     which no plantings were made), as determined by the 
     Secretary; and
       (ii) a contract payment shall be reduced by an acre for 
     each acre planted to the fruit or vegetable.
Subtitle C--Nonrecourse Marketing Assistance Loans and Loan Deficiency 
                                Payments

     SEC. 131. AVAILABILITY OF NONRECOURSE MARKETING ASSISTANCE 
                   LOANS.

       (a) 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 section 132 for the loan commodity.
       (b) Eligible Production.--The following production shall be 
     eligible for a marketing assistance loan under subsection 
     (a):
       (1) In the case of a marketing assistance loan for a 
     contract commodity, any production by a producer on a farm 
     containing eligible cropland covered by a production 
     flexibility contract.
       (2) In the case of a marketing assistance loan for extra 
     long staple cotton and oilseeds, any production.
       (c) Compliance With Conservation and Wetlands 
     Requirements.--As a condition of the receipt of a marketing 
     assistance loan under subsection (a), the producer shall 
     comply with applicable conservation requirements under 
     subtitle B of title XII of the Food Security Act of 1985 (16 
     U.S.C. 3811 et seq.) and applicable wetland protection 
     requirements under subtitle C of title XII of the Act (16 
     U.S.C. 3821 et seq.) during the term of the loan.
       (d) Additional Outlays Prohibited.--The Secretary shall 
     carry out this subtitle in such a manner that there are no 
     additional outlays under this subtitle as a result of the 
     reconstitution of a farm that occurs as a result of the 
     combination of another farm that does not contain

[[Page H2722]]

     eligible cropland covered by a production flexibility 
     contract.

     SEC. 132. LOAN RATES FOR MARKETING ASSISTANCE LOANS.

       (a) Wheat.--
       (1) Loan rate.--Subject to paragraph (2), the loan rate for 
     a marketing assistance loan under section 131 for wheat shall 
     be--
       (A) not less than 85 percent of the simple average price 
     received by producers of wheat, as determined by the 
     Secretary, during the marketing years for the immediately 
     preceding 5 crops of wheat, excluding the year in which the 
     average price was the highest and the year in which the 
     average price was the lowest in the period; but
       (B) not more than $2.58 per bushel.
       (2) Stocks to use ratio adjustment.--If the Secretary 
     estimates for any marketing year that the ratio of ending 
     stocks of wheat to total use for the marketing year will be--
       (A) equal to or greater than 30 percent, the Secretary may 
     reduce the loan rate for wheat for the corresponding crop by 
     an amount not to exceed 10 percent in any year;
       (B) less than 30 percent but not less than 15 percent, the 
     Secretary may reduce the loan rate for wheat for the 
     corresponding crop by an amount not to exceed 5 percent in 
     any year; or
       (C) less than 15 percent, the Secretary may not reduce the 
     loan rate for wheat for the corresponding crop.
       (b) Feed Grains.--
       (1) Loan rate for corn.--Subject to paragraph (2), the loan 
     rate for a marketing assistance loan under section 131 for 
     corn shall be--
       (A) not less than 85 percent of the simple average price 
     received by producers of corn, as determined by the 
     Secretary, during the marketing years for the immediately 
     preceding 5 crops of corn, excluding the year in which the 
     average price was the highest and the year in which the 
     average price was the lowest in the period; but
       (B) not more than $1.89 per bushel.
       (2) Stocks to use ratio adjustment.--If the Secretary 
     estimates for any marketing year that the ratio of ending 
     stocks of corn to total use for the marketing year will be--
       (A) equal to or greater than 25 percent, the Secretary may 
     reduce the loan rate for corn for the corresponding crop by 
     an amount not to exceed 10 percent in any year;
       (B) less than 25 percent but not less than 12.5 percent, 
     the Secretary may reduce the loan rate for corn for the 
     corresponding crop by an amount not to exceed 5 percent in 
     any year; or
       (C) less than 12.5 percent, the Secretary may not reduce 
     the loan rate for corn for the corresponding crop.
       (3) Other feed grains.--The loan rate for a marketing 
     assistance loan under section 131 for grain sorghum, barley, 
     and oats, respectively, shall be established at such level as 
     the Secretary determines is fair and reasonable in relation 
     to the rate that loans are made available for corn, taking 
     into consideration the feeding value of the commodity in 
     relation to corn.
       (c) Upland Cotton.--
       (1) Loan rate.--Subject to paragraph (2), the loan rate for 
     a marketing assistance loan under section 131 for upland 
     cotton shall be established by the Secretary at such loan 
     rate, per pound, as will reflect for the base quality of 
     upland cotton, as determined by the Secretary, at average 
     locations in the United States a rate that is not less than 
     the smaller of--
       (A) 85 percent of the average price (weighted by market and 
     month) of the base quality of cotton as quoted in the 
     designated United States spot markets during 3 years of the 
     5-year period ending July 31 of the year preceding the year 
     in which the crop is planted, excluding the year in which the 
     average price was the highest and the year in which the 
     average price was the lowest in the period; or
       (B) 90 percent of the average, for the 15-week period 
     beginning July 1 of the year preceding the year in which the 
     crop is planted, of the 5 lowest-priced growths of the 
     growths quoted for Middling 1\3/32\-inch cotton C.I.F. 
     Northern Europe (adjusted downward by the average difference 
     during the period April 15 through October 15 of the year 
     preceding the year in which the crop is planted between the 
     average Northern European price quotation of such quality of 
     cotton and the market quotations in the designated United 
     States spot markets for the base quality of upland cotton), 
     as determined by the Secretary.
       (2) Limitations.--The loan rate for a marketing assistance 
     loan for upland cotton shall not be less than $0.50 per pound 
     or more than $0.5192 per pound.
       (d) Extra Long Staple Cotton.--The loan rate for a 
     marketing assistance loan under section 131 for extra long 
     staple cotton shall be--
       (1) not less than 85 percent of the simple average price 
     received by producers of extra long staple cotton, as 
     determined by the Secretary, during 3 years of the 5-year 
     period ending July 31 of the year preceding the year in which 
     the crop is planted, excluding the year in which the average 
     price was the highest and the year in which the average price 
     was the lowest in the period; but
       (2) not more than $0.7965 per pound.
       (e) Rice.--The loan rate for a marketing assistance loan 
     under section 131 for rice shall be $6.50 per hundredweight.
       (f) Oilseeds.--
       (1) Soybeans.--The loan rate for a marketing assistance 
     loan under section 131 for soybeans shall be--
       (A) not less than 85 percent of the simple average price 
     received by producers of soybeans, as determined by the 
     Secretary, during the marketing years for the immediately 
     preceding 5 crops of soybeans, excluding the year in which 
     the average price was the highest and the year in which the 
     average price was the lowest in the period; but
       (B) not less than $4.92 or more than $5.26 per bushel.
       (2) Sunflower seed, canola, rapeseed, safflower, mustard 
     seed, and flaxseed.--The loan rate for a marketing assistance 
     loan under section 131 for sunflower seed, canola, rapeseed, 
     safflower, mustard seed, and flaxseed, individually, shall 
     be--
       (A) not less than 85 percent of the simple average price 
     received by producers of sunflower seed, individually, as 
     determined by the Secretary, during the marketing years for 
     the immediately preceding 5 crops of sunflower seed, 
     individually, excluding the year in which the average price 
     was the highest and the year in which the average price was 
     the lowest in the period; but
       (B) not less than $0.087 or more than $0.093 per pound.
       (3) Other oilseeds.--The loan rates for a marketing 
     assistance loan under section 131 for other oilseeds shall be 
     established at such level as the Secretary determines is fair 
     and reasonable in relation to the loan rate available for 
     soybeans, except in no event shall the rate for the oilseeds 
     (other than cottonseed) be less than the rate established for 
     soybeans on a per-pound basis for the same crop.

     SEC. 133. TERM OF LOANS.

       (a) Term of Loan.--In the case of each loan commodity 
     (other than upland cotton or extra long staple cotton), a 
     marketing assistance loan under section 131 shall have a term 
     of 9 months beginning on the first day of the first month 
     after the month in which the loan is made.
       (b) Special Rule for Cotton.--A marketing assistance loan 
     for upland cotton or extra long staple cotton shall have a 
     term of 10 months beginning on the first day of the month in 
     which the loan is made.
       (c) Extensions Prohibited.--The Secretary may not extend 
     the term of a marketing assistance loan for any loan 
     commodity.

     SEC. 134. REPAYMENT OF LOANS.

       (a) Repayment Rates for Wheat, Feed Grains, and Oilseeds.--
     The Secretary shall permit a producer to repay a marketing 
     assistance loan under section 131 for wheat, corn, grain 
     sorghum, barley, oats, and oilseeds at a rate that is the 
     lesser of--
       (1) the loan rate established for the commodity under 
     section 132, plus interest (as determined by the Secretary); 
     or
       (2) a rate that the Secretary determines will--
       (A) minimize potential loan forfeitures;
       (B) minimize the accumulation of stocks of the commodity by 
     the Federal Government;
       (C) minimize the cost incurred by the Federal Government in 
     storing the commodity; and
       (D) allow the commodity produced in the United States to be 
     marketed freely and competitively, both domestically and 
     internationally.
       (b) Repayment Rates for Upland Cotton and Rice.--The 
     Secretary shall permit producers to repay a marketing 
     assistance loan under section 131 for upland cotton and rice 
     at a rate that is the lesser of--
       (1) the loan rate established for the commodity under 
     section 132, plus interest (as determined by the Secretary); 
     or
       (2) the prevailing world market price for the commodity 
     (adjusted to United States quality and location), as 
     determined by the Secretary.
       (c) 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 section 132, plus interest (as determined by 
     the Secretary).
       (d) Prevailing World Market Price.--For purposes of this 
     section and section 136, the Secretary shall prescribe by 
     regulation--
       (1) a formula to determine the prevailing world market 
     price for each loan commodity, adjusted to United States 
     quality and location; and
       (2) a mechanism by which the Secretary shall announce 
     periodically the prevailing world market price for each loan 
     commodity.
       (e) Adjustment of Prevailing World Market Price for Upland 
     Cotton.--
       (1) 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 
     subsection (d) shall be further adjusted if--
       (A) the adjusted prevailing world market price is less than 
     115 percent of the loan rate for upland cotton established 
     under section 132, as determined by the Secretary; and
       (B) 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 section as the ``Northern Europe 
     price'').
       (2) Further adjustment.--Except as provided in paragraph 
     (3), 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:
       (A) The United States share of world exports.
       (B) The current level of cotton export sales and cotton 
     export shipments.
       (C) 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).
       (3) Limitation on further adjustment.--The adjustment under 
     paragraph (2) may not exceed the difference between--
       (A) 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
       (B) the Northern Europe price.

     SEC. 135. LOAN DEFICIENCY PAYMENTS.

       (a) Availability of Loan Deficiency Payments.--Except as 
     provided in subsection (d),

[[Page H2723]]

     the Secretary may make loan deficiency payments available to 
     producers who, although eligible to obtain a marketing 
     assistance loan under section 131 with respect to a loan 
     commodity, agree to forgo obtaining the loan for the 
     commodity in return for payments under this section.
       (b) Computation.--A loan deficiency payment under this 
     section shall be computed by multiplying--
       (1) the loan payment rate determined under subsection (c) 
     for the loan commodity; by
       (2) the quantity of the loan commodity 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 section.
       (c) Loan Payment Rate.--For purposes of this section, the 
     loan payment rate shall be the amount by which--
       (1) the loan rate established under section 132 for the 
     loan commodity; exceeds
       (2) the rate at which a loan for the commodity may be 
     repaid under section 134.
       (d) Exception for Extra Long Staple Cotton.--This section 
     shall not apply with respect to extra long staple cotton.

     SEC. 136. SPECIAL MARKETING LOAN PROVISIONS FOR UPLAND 
                   COTTON.

       (a) Cotton User Marketing Certificates.--
       (1) Issuance.--Subject to paragraph (4), 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--
       (A) 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
       (B) 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 section 132.
       (2) 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.
       (3) Administration of marketing certificates.--
       (A) Redemption, marketing, or exchange.--The Secretary 
     shall establish procedures for redeeming marketing 
     certificates for cash or marketing or exchange of the 
     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 cotton user marketing 
     certificates. Any price restrictions that would otherwise 
     apply to the disposition of agricultural commodities by the 
     Commodity Credit Corporation shall not apply to the 
     redemption of certificates under this subsection.
       (B) Designation of commodities and products.--To the extent 
     practicable, the Secretary shall permit owners of 
     certificates to designate the commodities and products, 
     including storage sites, the owners would prefer to receive 
     in exchange for certificates. If any certificate is not 
     presented for redemption, marketing, or exchange within a 
     reasonable number of days after the issuance of the 
     certificate (as determined by the Secretary), reasonable 
     costs of storage and other carrying charges, as determined by 
     the Secretary, shall be deducted from the value of the 
     certificate for the period beginning after the reasonable 
     number of days and ending with the date of the presentation 
     of the certificate to the Commodity Credit Corporation.
       (C) Transfers.--Marketing certificates issued to domestic 
     users and exporters of upland cotton may be transferred to 
     other persons in accordance with regulations issued by the 
     Secretary.
       (4) Exception.--The Secretary shall not issue marketing 
     certificates or cash payments under paragraph (1) 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 
     subsection, exceeds the Northern Europe price by more than 
     1.25 cents per pound.
       (5) Limitation on expenditures.--Total expenditures under 
     this subsection shall not exceed $701,000,000 during fiscal 
     years 1996 through 2002.
       (b) Special Import Quota.--
       (1) 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 subsection 
     (a), exceeds the Northern Europe price by more than 1.25 
     cents per pound, there shall immediately be in effect a 
     special import quota.
       (2) 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.
       (3) Application.--The quota shall apply to upland cotton 
     purchased not later than 90 days after the date of the 
     Secretary's announcement under paragraph (1) and entered into 
     the United States not later than 180 days after the date.
       (4) Overlap.--A special quota period may be established 
     that overlaps any existing quota period if required by 
     paragraph (1), except that a special quota period may not be 
     established under this subsection if a quota period has been 
     established under subsection (c).
       (5) Preferential tariff treatment.--The quantity under a 
     special import quota shall be considered to be an in-quota 
     quantity for purposes of--
       (A) section 213(d) of the Caribbean Basin Economic Recovery 
     Act (19 U.S.C. 2703(d));
       (B) section 204 of the Andean Trade Preference Act (19 
     U.S.C. 3203);
       (C) section 503(d) of the Trade Act of 1974 (19 U.S.C. 
     2463(d)); and
       (D) General Note 3(a)(iv) to the Harmonized Tariff 
     Schedule.
       (6) Definition.--In this subsection, 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.
       (c) 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 during 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 
     (b).

     SEC. 137. AVAILABILITY OF RECOURSE LOANS FOR HIGH MOISTURE 
                   FEED GRAINS AND SEED COTTON.

       (a) High Moisture Feed Grains.--
       (1) 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 containing eligible 
     cropland covered by a production flexibility contract who--
       (A) normally harvest all or a portion of their crop of corn 
     or grain sorghum in a high moisture state;
       (B) present--
       (i) certified scale tickets from an inspected, certified 
     commercial scale, including a licensed warehouse, feedlot, 
     feed mill, distillery, or other similar entity approved by 
     the Secretary, pursuant to regulations issued by the 
     Secretary; or
       (ii) field or other physical measurements of the standing 
     or stored crop in regions of the United States, 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;
       (C) 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 subsection 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 a facility 
     maintained by the users of corn and grain sorghum in a high 
     moisture state; and
       (D) comply with deadlines established by the Secretary for 
     harvesting the corn or grain sorghum and submit applications 
     for loans under

[[Page H2724]]

     this subsection within deadlines established by the 
     Secretary.
       (2) Eligibility of acquired feed grains.--A loan under this 
     subsection 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--
       (A) the acreage of the corn or grain sorghum in a high 
     moisture state harvested on the producer's farm; by
       (B) 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.
       (3) High moisture state defined.--In this subsection, the 
     term ``high moisture state'' means corn or grain sorghum 
     having a moisture content in excess of Commodity Credit 
     Corporation standards for marketing assistance loans made by 
     the Secretary under section 131.
       (b) Recourse Loans Available for Seed Cotton.--
       (1) Upland cotton.--For each of the 1996 through 2002 crops 
     of upland cotton, the Secretary shall make available recourse 
     seed cotton loans, as determined by the Secretary, to 
     producers on a farm containing eligible cropland covered by a 
     production flexibility contract.
       (2) Extra long staple cotton.--For each of the 1996 through 
     2002 crops of extra long staple cotton, the Secretary shall 
     make available recourse seed cotton loans, as determined by 
     the Secretary, on any production.
       (c) Repayment Rates.--Repayment of a recourse loan made 
     under this section shall be at the loan rate established for 
     the commodity by the Secretary, plus interest (as determined 
     by the Secretary).
                     Subtitle D--Other Commodities

                            CHAPTER 1--DAIRY

     SEC. 141. MILK PRICE SUPPORT PROGRAM.

       (a) Support Activities.--The Secretary of Agriculture shall 
     support the price of milk produced in the 48 contiguous 
     States through the purchase of cheese, butter, and nonfat dry 
     milk produced from the milk.
       (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, $10.35.
       (2) During calendar year 1997, $10.20.
       (3) During calendar year 1998, $10.05.
       (4) During calendar year 1999, $9.90.
       (c) Purchase Prices.--The support purchase prices under 
     this section for each of the products of milk (butter, 
     cheese, and nonfat dry milk) announced by the Secretary shall 
     be the same for all of that product sold by persons offering 
     to sell the product to the Secretary. The purchase prices 
     shall be sufficient to enable plants of average efficiency to 
     pay producers, on average, a price that is not less than the 
     rate of price support for milk in effect under subsection 
     (b).
       (d) Special Rule for Butter and Nonfat Dry Milk Purchase 
     Prices.--
       (1) Allocation of purchase prices.--The Secretary may 
     allocate the rate of price support between the purchase 
     prices for nonfat dry milk and butter in a manner that will 
     result in the lowest level of expenditures by the Commodity 
     Credit Corporation or achieve such other objectives as the 
     Secretary considers appropriate. Not later than 10 days after 
     making or changing an allocation, the Secretary shall notify 
     the Committee on Agriculture of the House of Representatives 
     and the Committee on Agriculture, Nutrition, and Forestry of 
     the Senate of the allocation. Section 553 of title 5, United 
     States Code, shall not apply with respect to the 
     implementation of this section.
       (2) Timing of purchase price adjustments.--The Secretary 
     may make any such adjustments in the purchase prices for 
     nonfat dry milk and butter the Secretary considers to be 
     necessary not more than twice in each calendar year.
       (e) Refunds of 1995 and 1996 Assessments.--
       (1) Refund required.--The Secretary shall provide for a 
     refund of the entire reduction required under section 
     204(h)(2) of the Agricultural Act of 1949 (7 U.S.C. 
     1446e(h)(2)), as in effect on the day before the amendment 
     made by subsection (g), in the price of milk received by a 
     producer during calendar year 1995 or 1996, if the producer 
     provides evidence that the producer did not increase 
     marketings in calendar year 1995 or 1996 when compared to 
     calendar year 1994 or 1995, respectively.
       (2) Exception.--This subsection shall not apply with 
     respect to a producer for a particular calendar year if the 
     producer has already received a refund under section 204(h) 
     of the Agricultural Act of 1949 for the same fiscal year 
     before the effective date of this section.
       (3) Treatment of refund.--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 and 3821).
       (f) Commodity Credit Corporation.--The Secretary shall 
     carry out the program authorized by this section through the 
     Commodity Credit Corporation.
       (g) Conforming Repeal.--Effective on the first day of the 
     first month beginning after the date of enactment of this 
     title, section 204 of the Agricultural Act of 1949 (7 U.S.C. 
     1446e) is repealed.
       (h) Period of Effectiveness.--This section (other than 
     subsection (g)) shall be effective only during the period 
     beginning on the first day of the first month beginning after 
     the date of enactment of this title and ending on December 
     31, 1999. The program authorized by this section shall 
     terminate on December 31, 1999, and shall be considered to 
     have expired notwithstanding section 257 of the Balanced 
     Budget and Emergency Deficit Control Act of 1985 (2 U.S.C. 
     907).

     SEC. 142. RECOURSE LOAN PROGRAM FOR COMMERCIAL PROCESSORS OF 
                   DAIRY PRODUCTS.

       (a) Recourse Loans Available.--Under such reasonable terms 
     and conditions as the Secretary may prescribe, the Secretary 
     shall make recourse loans available to commercial processors 
     of eligible dairy products to assist the processors to manage 
     inventories of eligible dairy products and assure a greater 
     degree of price stability for the dairy industry during the 
     year. The Secretary shall use the funds, facilities, and 
     authorities of the Commodity Credit Corporation to carry out 
     this section.
       (b) Amount of Loan.--The Secretary shall establish the 
     amount of a loan for eligible dairy products, which shall 
     reflect a milk equivalent value of $9.90 per hundredweight of 
     milk containing 3.67 percent butterfat. The rate of interest 
     charged participants under this section shall not be less 
     than the rate of interest charged the Commodity Credit 
     Corporation by the United States Treasury.
       (c) Period of Loan.--The original term of a recourse loan 
     made under this section may not extend beyond the end of the 
     fiscal year in which the loan is made. At the end of the 
     fiscal year, the Secretary may extend the loan for an 
     additional period not to exceed the end of the next fiscal 
     year.
       (d) Definition of Eligible Dairy Products.--In this 
     section, the term ``eligible dairy products'' means cheddar 
     cheese, butter, and nonfat dry milk.
       (e) Effective Date.--This section shall be effective 
     beginning January 1, 2000.

     SEC. 143. CONSOLIDATION AND REFORM OF FEDERAL MILK MARKETING 
                   ORDERS.

       (a) Amendment of Orders.--
       (1) Required consolidation.--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 limit the number of Federal milk marketing orders to 
     not less than 10 and not more than 14 orders.
       (2) Inclusion of california as separate order.--Upon the 
     petition and approval of California dairy producers in the 
     manner provided in section 8c of the Agricultural Adjustment 
     Act (7 U.S.C. 608c), reenacted with amendments by the 
     Agricultural Marketing Agreement Act of 1937, the Secretary 
     shall designate the State of California as a separate Federal 
     milk marketing order. The order covering California shall 
     have the right to reblend and distribute order receipts to 
     recognize quota value.
       (3) Related issues addressed in consolidation.--Among the 
     issues the Secretary is authorized to implement as part of 
     the consolidation of Federal milk marketing orders are the 
     following:
       (A) The use of utilization rates and multiple basing points 
     for the pricing of fluid milk.
       (B) The use of uniform multiple component pricing when 
     developing 1 or more basic formula prices for manufacturing 
     milk.
       (4) Effect of existing law.--In implementing the 
     consolidation of Federal milk marketing orders and related 
     reforms under this subsection, the Secretary may not 
     consider, or base any decision on, the table contained in 
     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, as added by section 131 of 
     the Food Security Act of 1985.
       (b) Expedited Process.--
       (1) Use of informal rulemaking.--To implement the 
     consolidation of Federal milk marketing orders and related 
     reforms under subsection (a), the Secretary shall use the 
     notice and comment procedures provided in section 553 of 
     title 5, United States Code.
       (2) Time limitations.--
       (A) Proposed amendments.--The Secretary shall announce the 
     proposed amendments to be made under subsection (a) not later 
     than 2 years after the date of enactment of this title.
       (B) Final amendments.--The Secretary shall implement the 
     amendments not later than 3 years after the date of enactment 
     of this title.
       (3) Effect of court order.--The actions authorized by this 
     subsection are intended to ensure the timely publication and 
     implementation of new and amended Federal milk marketing 
     orders. In the event that the Secretary is enjoined or 
     otherwise restrained by a court order from publishing or 
     implementing the consolidation and related reforms under 
     subsection (a), the length of time for which that injunction 
     or other restraining order is effective shall be added to the 
     time limitations specified in paragraph (2) 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.
       (c) Failure To Timely Consolidate Orders.--If the Secretary 
     fails to implement the consolidation required under 
     subsection (a)(1) within the time period required under 
     subsection (b)(2)(B) (plus any additional period provided 
     under subsection (b)(3)), 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 until the consolidation is completed. The Secretary 
     may not reduce the level of services provided under the 
     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.
       (d) Report Regarding Further Reforms.--
       (1) Report required.--Not later than April 1, 1997, the 
     Secretary shall submit to Congress a report--
       (A) reviewing the Federal milk marketing order system 
     established pursuant to section 8c of the Agricultural 
     Adjustment Act (7 U.S.C.

[[Page H2725]]

     608c), reenacted with amendments by the Agricultural 
     Marketing Agreement Act of 1937, in light of the reforms 
     required by subsection (a);
       (B) describing the efforts underway and the progress made 
     in implementing the reforms required by subsection (a); and
       (C) containing such recommendations as the Secretary 
     considers appropriate for further improvements and reforms to 
     the Federal milk marketing order system.
       (2) Effect of other laws.--Any limitation imposed by Act of 
     Congress on the conduct or completion of reports to Congress 
     shall not apply to the report required under this section, 
     unless the limitation specifically refers to this section.

     SEC. 144. EFFECT ON FLUID MILK STANDARDS IN STATE OF 
                   CALIFORNIA.

       Nothing in this Act or any other provision of law shall be 
     construed to preempt, prohibit, or otherwise limit the 
     authority of the State of California, directly or indirectly, 
     to establish or continue to effect any law, regulation, or 
     requirement regarding--
       (1) the percentage of milk solids or solids not fat in 
     fluid milk products sold at retail or marketed in the State 
     of California; or
       (2) the labeling of such fluid milk products with regard to 
     milk solids or solids not fat.

     SEC. 145. MILK MANUFACTURING MARKETING ADJUSTMENT.

       (a) Maximum Allowances Established.--No State shall provide 
     for a manufacturing allowance for the processing of milk in 
     excess of--
       (1) $1.65 per hundredweight of milk for milk manufactured 
     into butter and nonfat dry milk; and
       (2) $1.80 per hundredweight of milk for milk manufactured 
     into cheese.
       (b) 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 butterfat and 8.7 pounds of 
     milk solids not fat resulting from a State's yield and 
     product price formulas exceeds the class price for the milk 
     used to produce those products; or
       (2) the amount by which the product price value of cheese 
     manufactured from a hundred pounds of milk containing 3.5 
     pounds of butterfat and 8.7 pounds of milk solids not fat 
     resulting from a State's yield and product price formulas 
     exceeds the class price for the milk used to produce cheese.
       (c) Effect of Violation.--If the Secretary determines 
     following a hearing that a State has in effect a 
     manufacturing allowance that exceeds the manufacturing 
     allowance authorized in subsection (a), the Secretary shall 
     suspend purchases of cheddar cheese, butter, and nonfat dry 
     milk produced in that State until such time as the State 
     complies with such subsection.
       (d) Effective Date; Implementation.--This section (other 
     than subsection (e)) shall be effective during the period 
     beginning on the first day of the first month beginning after 
     the date of enactment of this title and ending on December 
     31, 1999. During that period, 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.
       (e) Conforming Repeal.--Effective on the first day of the 
     first month beginning after the date of enactment of this 
     title, section 102 of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (7 U.S.C. 1446e-1) is repealed.

     SEC. 146. PROMOTION.

       (a) Congressional Purpose.--Section 1999B(a) of the Fluid 
     Milk Promotion Act of 1990 (7 U.S.C. 6401(a)) is amended--
       (1) by redesignating paragraphs (6), (7) and (8) as 
     paragraphs (7), (8) and (9), respectively; and
       (2) by inserting after paragraph (5) the following:
       ``(6) the congressional purpose underlying this subtitle is 
     to maintain and expand markets for fluid milk products, not 
     to maintain or expand any processor's share of those markets 
     and that the subtitle does not prohibit or restrict 
     individual advertising or promotion of fluid milk products 
     since the programs created and funded by this subtitle are 
     not extended to replace individual advertising and promotion 
     efforts;''.
       (b) Congressional Policy.--Section 1999B(b) of the Fluid 
     Milk Promotion Act of 1990 (7 U.S.C. 6401(b)) is amended to 
     read as follows:
       ``(b) Policy.--It is declared to be the policy of Congress 
     that it is in the public interest to authorize the 
     establishment, through the exercise of powers provided in 
     this subtitle, of an orderly procedure for developing, 
     financing, through adequate assessments on fluid milk 
     products produced in the United States and carrying out an 
     effective, continuous, and coordinated program of promotion, 
     research, and consumer information designed to strengthen the 
     position of the dairy industry in the marketplace and 
     maintain and expand domestic and foreign markets and uses for 
     fluid milk products, the purpose of which is not to compete 
     with or replace individual advertising or promotion efforts 
     designed to promote individual brand name or trade name fluid 
     milk products, but rather to maintain and expand the markets 
     for all fluid milk products, with the goal and purpose of 
     this subtitle being a national governmental goal that 
     authorizes and funds programs that result in government 
     speech promoting government objectives.''.
       (c) Research.--Section 1999C(6) of the Fluid Milk Promotion 
     Act of 1990 (7 U.S.C. 6402(6)) is amended to read as follows:
       ``(6) Research.--The term `research' means market research 
     to support advertising and promotion efforts, including 
     educational activities, research directed to product 
     characteristics, product development, including new products 
     or improved technology in production, manufacturing or 
     processing of milk and the products of milk.''.
       (d) Voting.--
       (1) Initial referenda.--Section 1999N(b)(2) of the Fluid 
     Milk Promotion Act of 1990 (7 U.S.C. 6413(b)(2)) is amended 
     by striking ``all processors'' and inserting ``fluid milk 
     processors voting in the referendum''.
       (2) Suspension or termination.--Section 1999O(c) of such 
     Act (7 U.S.C. 6414(c)) is amended--
       (A) in paragraph (1), by striking ``all processors'' and 
     inserting ``fluid milk processors voting in the preceding 
     referendum''; and
       (B) in paragraph (2)(B), by striking ``all processors'' and 
     inserting ``fluid milk processors voting in the referendum''.
       (e) Duration.--Section 1999O(a) of the Fluid Milk Promotion 
     Act of 1990 (7 U.S.C. 6414(a)) is amended by striking 
     ``1996'' and inserting ``2002''.

     SEC. 147. NORTHEAST INTERSTATE DAIRY COMPACT.

       Congress hereby consents to the Northeast Interstate Dairy 
     Compact entered into among the States of Connecticut, Maine, 
     Massachusetts, New Hampshire, Rhode Island and Vermont as 
     specified in section 1(b) Senate Joint Resolution 28 of the 
     104th Congress, as placed on the calendar of the Senate, 
     subject to the following conditions:
       (1) Finding of Compelling Public Interest.--Based upon a 
     finding by the Secretary of a compelling public interest in 
     the Compact region, the Secretary may grant the States that 
     have ratified the Northeast Interstate Dairy Compact, as of 
     the date of enactment of this title, the authority to 
     implement the Northeast Interstate Dairy Compact.
       (2) Limitation on Manufacturing Price.--The Northeast 
     Interstate Dairy Compact Commission shall not regulate Class 
     II, Class III, or Class III-A milk used for manufacturing 
     purposes or any other milk, other than Class I (fluid) milk, 
     as defined by a Federal milk marketing order issued under 
     section 8c of the Agricultural Adjustment Act (7 U.S.C. 608c) 
     reenacted with amendments by the Agricultural Marketing 
     Agreement Act of 1937.
       (3) Duration.--Consent for the Northeast Interstate Dairy 
     Compact shall terminate concurrent with the Secretary's 
     implementation of the dairy pricing and Federal milk 
     marketing order consolidation and reforms under section 143.
       (4) Additional States.--Delaware, New Jersey, New York, 
     Pennsylvania, Maryland, and Virginia are the only additional 
     States that may join the Northeast Interstate Dairy Compact, 
     individually or otherwise, if upon entry the State is 
     contiguous to a participating State and if Congress consents 
     to the entry of the State into the Compact after the date of 
     enactment of this title.
       (5) Compensation of Commodity Credit Corporation.--Before 
     the end of each fiscal year that a Compact price regulation 
     is in effect, the Northeast Interstate Dairy Compact 
     Commission shall compensate the Commodity Credit Corporation 
     for the cost of any purchases of milk and milk products by 
     the Corporation that result from the projected rate of 
     increase in milk production for the fiscal year within the 
     Compact region in excess of the projected national average 
     rate of the increase in milk production, as determined by the 
     Secretary.
       (6) Milk Marketing Order Administrator.--At the request of 
     the Northeast Interstate Dairy Compact Commission, the 
     Administrator of the applicable Federal milk marketing order 
     issued under section 8(c)5 of the Agricultural Adjustment Act 
     (7 U.S.C. 608c), reenacted with amendments by the 
     Agricultural Marketing Agreement Act of 1937, shall provide 
     technical assistance to the Compact Commission and be 
     compensated for that assistance.
       (7) Further Conditions.--The Northeast Interstate Dairy 
     Compact Commission shall not prohibit or in any way limit the 
     marketing in the Compact region of any milk or milk product 
     produced in any other production area in the United States. 
     The Compact Commission shall respect and abide by the ongoing 
     procedures between Federal milk marketing orders with respect 
     to the sharing of proceeds from sales within the Compact 
     region of bulk milk, packaged milk, or producer milk 
     originating from outside of the Compact region. The Compact 
     Commission shall not use compensatory payments under section 
     10(6) of the Compact as a barrier to the entry of milk into 
     the Compact region or for any other purpose. Establishment of 
     a Compact over-order price, in itself, shall not be 
     considered a compensatory payment or a limitation or 
     prohibition on the marketing of milk.

     SEC. 148. DAIRY EXPORT INCENTIVE PROGRAM.

       (a) Duration.--Section 153(a) of the Food Security Act of 
     1985 (15 U.S.C. 713a-14(a)) is amended by striking ``2001'' 
     and inserting ``2002''.
       (b) Sole Discretion.--Section 153(b) of the Food Security 
     Act of 1985 (15 U.S.C. 713a-14(b)) is amended by inserting 
     ``sole'' before ``discretion''.
       (c) Elements of Program.--Section 153(c) of the Food 
     Security Act of 1985 (15 U.S.C. 713a-14(c)) 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 a semicolon; and
       (3) by adding at the end the following:
       ``(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 is exported under the 
     program each year (minus the volume sold under section 1163 
     of the Food Security Act of 1985 (Public Law 99-198; 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

[[Page H2726]]

       ``(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.''.
       (d) Market Development.--Section 153(e)(1) of the Food 
     Security Act of 1985 (15 U.S.C. 713a-14(e)(1)) 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.--Section 153 of the Food 
     Security Act of 1985 (15 U.S.C. 713a-14) is amended by adding 
     at the end the following:
       ``(f) Required Funding.--
       ``(1) In general.--Except as provided in paragraph (2), 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 the Food Security Act of 1985 
     (Public Law 99-198; 7 U.S.C. 1731 note) during that year.
       ``(2) Volume limitations.--The Commodity Credit Corporation 
     may not exceed the limitations specified in subsection (c)(3) 
     on the volume of allowable dairy product exports.''.

     SEC. 149. AUTHORITY TO ASSIST IN ESTABLISHMENT AND 
                   MAINTENANCE OF ONE OR MORE EXPORT TRADING 
                   COMPANIES.

       The Secretary of Agriculture shall, consistent with the 
     obligations of the United States as a member of the World 
     Trade Organization, provide such advice and assistance to the 
     United States dairy industry as may be necessary to enable 
     that industry to establish and maintain one or more export 
     trading companies under the Export Trading Company Act of 
     1982 (15 U.S.C. 4001 et seq.) for the purpose of facilitating 
     the international market development for and exportation of 
     dairy products produced in the United States.

     SEC. 150. STANDBY AUTHORITY TO INDICATE ENTITY BEST SUITED TO 
                   PROVIDE INTERNATIONAL MARKET DEVELOPMENT AND 
                   EXPORT SERVICES.

       (a) Indication of Entity Best Suited To Assist 
     International Market Development for and Export of United 
     States Dairy Products.--The Secretary of Agriculture shall 
     indicate which entity or entities autonomous of the 
     Government of the United States, which seeks such a 
     designation, is best suited to facilitate the international 
     market development for and exportation of United States dairy 
     products, if the Secretary determines that--
       (1) the United States dairy industry has not established an 
     export trading company under the Export Trading Company Act 
     of 1982 (15 U.S.C. 4001 et seq.) for the purpose of 
     facilitating the international market development for an 
     exportation of dairy products produced in the United States 
     on or before June 30, 1997; or
       (2) the quantity of exports of United States dairy products 
     during the 12-month period preceding July 1, 1998 does not 
     exceed the quantity of exports of United States dairy 
     products during the 12-month period preceding July 1, 1997 by 
     1.5 billion pounds (milk equivalent, total solids basis).
       (b) Funding of Export Activities.--The Secretary shall 
     assist the entity or entities identified under subsection (a) 
     in identifying sources of funding for the activities 
     specified in subsection (a) from within the dairy industry 
     and elsewhere.
       (c) Application of Section.--This section shall apply only 
     during the period beginning on July 1, 1997 and ending on 
     September 30, 2000.

     SEC. 151. STUDY AND REPORT REGARDING POTENTIAL IMPACT OF 
                   URUGUAY ROUND ON PRICES, INCOME, AND GOVERNMENT 
                   PURCHASES.

       (a) Study.--The Secretary of Agriculture shall conduct a 
     study, on a variety by variety of cheese basis, to determine 
     the potential impact on milk prices in the United States, 
     dairy producer income, and Federal dairy program costs, of 
     the allocation of additional cheese granted access to the 
     United States as a result of the obligations of the United 
     States as a member of the world Trade Organization.
       (b) Report.--Not later than June 30, 1997, the Secretary 
     shall report to the Committee on Agriculture, Nutrition, and 
     Forestry of the Senate and the Committee on Agriculture of 
     the House of Representatives the results of the study 
     conducted under this section.
       (c) Rule of Construction.--Any limitation imposed by Act of 
     Congress on the conduct or completion of studies or reports 
     to Congress shall not apply to the study and report required 
     under this section, unless the limitation specifically refers 
     to this section.

     SEC. 152. PROMOTION OF UNITED STATES DAIRY PRODUCTS IN 
                   INTERNATIONAL MARKETS THROUGH DAIRY PROMOTION 
                   PROGRAM.

       Section 113(e) of the Dairy Production Stabilization Act of 
     1983 (7 U.S.C. 4504(e)) is amended by adding at the end the 
     following new sentence: ``For each of fiscal years 1997 
     through 2001, the Board's budget may provide for the 
     expenditure of 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.''.

                      CHAPTER 2--PEANUTS AND SUGAR

     SEC. 155. PEANUT PROGRAM.

       (a) Quota Peanuts.--
       (1) Availability of loans.--The Secretary shall make 
     nonrecourse loans available to producers of quota peanuts.
       (2) Loan rate.--The national average quota loan rate for 
     quota peanuts shall be $610 per ton.
       (3) Inspection, handling, or storage.--The loan amount may 
     not be reduced by the Secretary by any deductions for 
     inspection, handling, or storage.
       (4) Location and other factors.--The Secretary may make 
     adjustments in the loan rate for quota peanuts for location 
     of peanuts and such other factors as are authorized by 
     section 162.
       (5) Offers from handlers.--If a producer markets a quota 
     peanut crop, meeting quality requirements for domestic edible 
     use, through the marketing association loan for two 
     consecutive marketing years and the Secretary determines that 
     a handler provided the producer with a written offer, upon 
     delivery, for the purchase of the quota peanut crops at a 
     price equal to or in excess of the quota support price, the 
     producer shall be ineligible for quota price support for the 
     next marketing year. The Secretary shall establish the method 
     by which a producer may appeal a determination under this 
     paragraph regarding ineligibility for quota price support.
       (b) Additional Peanuts.--
       (1) In general.--Subject to paragraph (2), the Secretary 
     shall make nonrecourse loans available to producers of 
     additional peanuts at such rates as the Secretary finds 
     appropriate, taking into consideration the demand for peanut 
     oil and peanut meal, expected prices of other vegetable oils 
     and protein meals, and the demand for peanuts in foreign 
     markets.
       (2) Limitation.--The Secretary shall establish the support 
     rate on additional peanuts at a level estimated by the 
     Secretary to ensure that there are no losses to the Commodity 
     Credit Corporation on the sale or disposal of the peanuts.
       (3) Announcement.--The Secretary shall announce the loan 
     rate for additional peanuts of each crop not later than 
     February 15 preceding the marketing year for the crop for 
     which the loan rate is being determined.
       (c) Area Marketing Associations.--
       (1) Warehouse storage loans.--
       (A) In general.--In carrying out subsections (a) and (b), 
     the Secretary shall make warehouse storage loans available in 
     each of the producing areas (described in section 1446.95 of 
     title 7 of the Code of Federal Regulations (January 1, 1989)) 
     to a designated area marketing association of peanut 
     producers that is selected and approved by the Secretary and 
     that is operated primarily for the purpose of conducting the 
     loan activities. The Secretary may not make warehouse storage 
     loans available to any cooperative that is engaged in 
     operations or activities concerning peanuts other than those 
     operations and activities specified in this section and 
     section 358e of the Agricultural Adjustment Act of 1938 (7 
     U.S.C. 1359a).
       (B) Administrative and supervisory activities.--An area 
     marketing association shall be used in administrative and 
     supervisory activities relating to loans and marketing 
     activities under this section and section 358e of the 
     Agricultural Adjustment Act of 1938 (7 U.S.C. 1359a).
       (C) Association costs.--Loans made to the association under 
     this paragraph shall include such costs as the area marketing 
     association reasonably may incur in carrying out the 
     responsibilities, operations, and activities of the 
     association under this section and section 358e of the 
     Agricultural Adjustment Act of 1938 (7 U.S.C. 1359a).
       (2) Pools for quota and additional peanuts.--
       (A) In general.--The Secretary shall require that each area 
     marketing association establish pools and maintain complete 
     and accurate records by area and segregation for quota 
     peanuts handled under loan and for additional peanuts placed 
     under loan, except that separate pools shall be established 
     for Valencia peanuts produced in New Mexico.
       (B) Eligibility to participate in new mexico pools.--
       (i) In general.--Except as provided in clause (ii), in the 
     case of the 1996 and subsequent crops, Valencia peanuts not 
     physically produced in the State of New Mexico shall not be 
     eligible to participate in the pools of the State.
       (ii) Exception.--A producer of Valencia peanuts may enter 
     Valencia peanuts that are produced in Texas into the pools of 
     New Mexico in a quantity not greater than the average annual 
     quantity of the peanuts that the producer entered into the 
     New Mexico pools for the 1990 through 1995 crops.
       (C) Types of peanuts.--Bright hull and dark hull Valencia 
     peanuts shall be considered as separate types for the purpose 
     of establishing the pools.
       (D) Net gains.--Net gains on peanuts in each pool, unless 
     otherwise approved by the Secretary, shall be distributed 
     only to producers who placed peanuts in the pool and shall be 
     distributed in proportion to the value of the peanuts placed 
     in the pool by each producer. Net gains for peanuts in each 
     pool shall consist of the following:
       (i) Quota peanuts.--For quota peanuts, the net gains over 
     and above the loan indebtedness and other costs or losses 
     incurred on peanuts placed in the pool.
       (ii) Additional peanuts.--For additional peanuts, the net 
     gains over and above the loan indebtedness and other costs or 
     losses incurred on peanuts placed in the pool for additional 
     peanuts.
       (d) Losses.--Losses in quota area pools shall be covered 
     using the following sources in the following order of 
     priority:
       (1) Transfers from additional loan pools.--The proceeds due 
     any producer from any pool shall be reduced by the amount of 
     any loss that is incurred with respect to peanuts transferred 
     from an additional loan pool to a

[[Page H2727]]

     quota loan pool by the producer under section 358-1(b)(8) of 
     the Agricultural Adjustment Act of 1938 (7 U.S.C. 1358-
     1(b)(8)).
       (2) Producers in same pool.--Further losses in an area 
     quota pool shall be offset by reducing the gain of any 
     producer in the pool by the amount of pool gains attributed 
     to the same producer from the sale of additional peanuts for 
     domestic and edible export use.
       (3) Offset within area.--Further losses in an area quota 
     pool shall be offset by any gains or profits from additional 
     peanuts (other than separate type pools established under 
     subsection (c)(2)(A) for Valencia peanuts produced in New 
     Mexico) owned or controlled by the Commodity Credit 
     Corporation in that area and sold for domestic edible use, in 
     accordance with regulations issued by the Secretary. This 
     paragraph shall not apply to profits or gains from a farm 
     with 1 acre or less of peanut production.
       (4) First use of marketing assessments.--The Secretary 
     shall use funds collected under subsection (g) (except funds 
     attributable to handlers) to offset further losses in area 
     quota pools. The Secretary shall transfer to the Treasury 
     those funds collected under subsection (g) and available for 
     use under this paragraph that the Secretary determines are 
     not required to cover losses in area quota pools.
       (5) Cross compliance.--Further losses in area quota pools, 
     other than losses incurred as a result of transfers from 
     additional loan pools to quota loan pools under section 358-
     1(b)(8) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 
     1358-1(b)(8)), shall be offset by any gains or profits from 
     quota pools in other production areas (other than separate 
     type pools established under subsection (c)(2)(A) for 
     Valencia peanuts produced in New Mexico) in such manner as 
     the Secretary shall by regulation prescribe.
       (6) Offset generally.--If losses in an area quota pool have 
     not been entirely offset under the preceding paragraphs, 
     further losses shall be offset by any gains or profits from 
     additional peanuts (other than separate type pools 
     established under subsection (c)(2)(A) for Valencia peanuts 
     produced in New Mexico) owned or controlled by the Commodity 
     Credit Corporation and sold for domestic edible use, in 
     accordance with regulations issued by the Secretary. This 
     paragraph shall not apply to profits or gains from a farm 
     with 1 acre or less of peanut production.
       (7) Second use of marketing assessments.--The Secretary 
     shall use funds collected under subsection (g) and 
     attributable to handlers to offset further losses in area 
     quota pools. The Secretary shall transfer to the Treasury 
     those funds collected under subsection (g) and available for 
     use under this paragraph that the Secretary determines are 
     not required to cover losses in area quota pools.
       (8) Increased assessments.--If use of the authorities 
     provided in the preceding paragraphs is not sufficient to 
     cover losses in an area quota pool, the Secretary shall 
     increase the marketing assessment for producers established 
     under subsection (g) by such an amount as the Secretary 
     considers necessary to cover the losses. The increased 
     assessment shall apply only to quota peanuts in the 
     production area covered by the pool. Amounts collected under 
     subsection (g) as a result of the increased assessment shall 
     be retained by the Secretary to cover losses in that pool.
       (e) Disapproval of Quotas.--Notwithstanding any other 
     provision of law, no loan for quota peanuts may be made 
     available by the Secretary for any crop of peanuts with 
     respect to which poundage quotas have been disapproved by 
     producers, as provided for in section 358-1(d) of the 
     Agricultural Adjustment Act of 1938 (7 U.S.C. 1358-1(d)).
       (f) Quality Improvement.--
       (1) In general.--With respect to peanuts under loan, the 
     Secretary shall--
       (A) promote the crushing of peanuts at a greater risk of 
     deterioration before peanuts of a lesser risk of 
     deterioration;
       (B) ensure that all Commodity Credit Corporation 
     inventories of peanuts sold for domestic edible use must be 
     shown to have been officially inspected by licensed 
     Department inspectors both as farmer stock and shelled or 
     cleaned in-shell peanuts;
       (C) continue to endeavor to operate the peanut program so 
     as to improve the quality of domestic peanuts and ensure the 
     coordination of activities under the Peanut Administrative 
     Committee established under Marketing Agreement No. 146, 
     regulating the quality of domestically produced peanuts 
     (under the Agricultural Adjustment Act (7 U.S.C. 601 et 
     seq.), reenacted with amendments by the Agricultural 
     Marketing Agreement Act of 1937); and
       (D) ensure that any changes made in the peanut program as a 
     result of this subsection requiring additional production or 
     handling at the farm level shall be reflected as an upward 
     adjustment in the Department loan schedule.
       (2) Exports and other peanuts.--The Secretary shall require 
     that all peanuts in the domestic and export markets fully 
     comply with all quality standards under Marketing Agreement 
     No. 146.
       (g) Marketing Assessment.--
       (1) In general.--The Secretary shall provide for a 
     nonrefundable marketing assessment. The assessment shall be 
     made on a per pound basis in an amount equal to 1.1 percent 
     for each of the 1994 and 1995 crops, 1.15 percent for the 
     1996 crop, and 1.2 percent for each of the 1997 through 2002 
     crops, of the national average quota or additional peanut 
     loan rate for the applicable crop.
       (2) First purchasers.--
       (A) In general.--Except as provided under paragraphs (3) 
     and (4), the first purchaser of peanuts shall--
       (i) collect from the producer a marketing assessment equal 
     to the quantity of peanuts acquired multiplied by--

       (I) in the case of each of the 1994 and 1995 crops, .55 
     percent of the applicable national average loan rate;
       (II) in the case of the 1996 crop, .6 percent of the 
     applicable national average loan rate; and
       (III) in the case of each of the 1997 through 2002 crops, 
     .65 percent of the applicable national average loan rate;

       (ii) pay, in addition to the amount collected under clause 
     (i), a marketing assessment in an amount equal to the 
     quantity of peanuts acquired multiplied by .55 percent of the 
     applicable national average loan rate; and
       (iii) remit the amounts required under clauses (i) and (ii) 
     to the Commodity Credit Corporation in a manner specified by 
     the Secretary.
       (B) Definition of first purchaser.--In this subsection, the 
     term ``first purchaser'' means a person acquiring peanuts 
     from a producer except that in the case of peanuts forfeited 
     by a producer to the Commodity Credit Corporation, the term 
     means the person acquiring the peanuts from the Commodity 
     Credit Corporation.
       (3) Other private marketings.--In the case of a private 
     marketing by a producer directly to a consumer through a 
     retail or wholesale outlet or in the case of a marketing by 
     the producer outside of the continental United States, the 
     producer shall be responsible for the full amount of the 
     assessment and shall remit the assessment by such time as is 
     specified by the Secretary.
       (4) Loan peanuts.--In the case of peanuts that are pledged 
     as collateral for a loan made under this section, the 
     producer portion of the assessment shall be deducted from the 
     proceeds of the loan. The remainder of the assessment shall 
     be paid by the first purchaser of the peanuts. For purposes 
     of computing net gains on peanuts under this section, the 
     reduction in loan proceeds shall be treated as having been 
     paid to the producer.
       (5) Penalties.--If any person fails to collect or remit the 
     reduction required by this subsection or fails to comply with 
     the requirements for recordkeeping or otherwise as are 
     required by the Secretary to carry out this subsection, the 
     person shall be liable to the Secretary for a civil penalty 
     up to an amount determined by multiplying--
       (A) the quantity of peanuts involved in the violation; by
       (B) the national average quota peanut rate for the 
     applicable crop year.
       (6) Enforcement.--The Secretary may enforce this subsection 
     in the courts of the United States.
       (h) Crops.--Subsections (a) through (g) shall be effective 
     only for the 1996 through 2002 crops of peanuts.
       (i) Poundage Quotas.--
       (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'';

       (v) in subsection (b)(1), by adding at the end the 
     following:
       ``(D) Certain farms ineligible for quota.--Effective 
     beginning with the 1998 crop, the Secretary shall not 
     establish a farm poundage quota under subparagraph (A) for a 
     farm owned or controlled by--
       ``(i) a municipality, airport authority, school, college, 
     refuge, or other public entity (other than a university used 
     for research purposes); or
       ``(ii) a person who is not a producer and resides in 
     another State.'';
       (vi) in subsection (b)(2), 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.''; and
       (vii) 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) Elimination of quota floor.--Section 358-1(a)(1) of the 
     Agricultural Adjustment Act of 1938 (7 U.S.C. 1358-1(a)(1)) 
     is amended by striking the second sentence.
       (3) Temporary quota allocation.--Section 358-1 of the 
     Agricultural Adjustment Act of 1938 (7 U.S.C. 1358-1) is 
     amended--
       (A) in subsection (a)(1), by striking ``domestic edible, 
     seed,'' and inserting ``domestic edible use (except seed)''; 
     and
       (B) in subsection (b)(2)--
       (i) in subparagraph (A), by striking ``subparagraph (B) and 
     subject to''; and

[[Page H2728]]

       (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 and determined 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).''.
       (4) Undermarketings.--Part VI of subtitle B of title III of 
     the Agricultural Adjustment Act of 1938 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 (2), by striking ``(including any 
     applicable under marketings)''; and
       (ii) in paragraph (3), by striking ``(including any 
     applicable undermarketings)''.
       (5) Disaster transfers.--Section 358-1(b) of the 
     Agricultural Adjustment Act of 1938 (7 U.S.C. 1358-1(b)), as 
     amended by paragraph (4)(A)(iii), is 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.''.
       (6) Sale or lease.--Section 358b(a) of the Agricultural 
     Adjustment Act of 1938 (7 U.S.C. 1358b(a)) is amended--
       (A) by striking paragraph (1) and inserting the following:
       ``(1) Sale and lease authority.--
       ``(A) Sale or lease within same state.--Subject to 
     subparagraph (B) and such terms and conditions as the 
     Secretary may prescribe, the owner, or operator with the 
     permission of the owner, of a farm in a State for which a 
     farm poundage quota has been established may sell or lease 
     all or any part of the poundage quota to any other owner or 
     operator of a farm within the same State for transfer to the 
     farm. However, any such lease of poundage quota may be 
     entered into in the fall or after the normal planting 
     season--
       ``(i) if not less than 90 percent of the basic quota (the 
     farm quota and 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; and
       ``(ii) under such terms and conditions as the Secretary may 
     by regulation prescribe.
     ``In the case of a fall transfer or a transfer after the 
     normal planting season by a cash lessee, the landowner shall 
     not be required to sign the transfer authorization. A fall 
     transfer or a transfer after the normal planting season may 
     be made not later than 72 hours after the peanuts that are 
     the subject of the transfer are inspected and graded.
       ``(B) Percentage limitations on spring transfers.--Spring 
     transfers under subparagraph (A) by sale or lease of a quota 
     for farms in a county to any owner or operator of a farm 
     outside the county within the same State shall not exceed the 
     applicable percentage specified in this subparagraph of the 
     quotas of all farms in the originating county (as of January 
     1, 1996) for the crop year in which the transfer is made, 
     plus the total amount of quotas eligible for transfer from 
     the originating county in the preceding crop year that were 
     not transferred in that year or that were transferred through 
     an expired lease. However, not more than an aggregate of 40 
     percent of the total poundage quota within a county (as of 
     January 1, 1996) may be transferred outside of the county. 
     Cumulative unexpired transfers outside of a county may not 
     exceed for a crop year the following:
       ``(i) For the 1996 crop, 15 percent.
       ``(ii) For the 1997 crop, 25 percent.
       ``(iii) For the 1998 crop, 30 percent.
       ``(iv) For the 1999 crop, 35 percent.
       ``(v) For the 2000 and subsequent crops, not more than an 
     aggregate of 40 percent of the total poundage quota within 
     the county as of January 1, 1996.
       ``(C) Clarification regarding fall transfers.--The 
     limitation in subparagraph (B) does not apply to 1-year fall 
     transfers, which in all cases may be made to any farm in the 
     same State.
       ``(D) Effect of transfer.--Any farm poundage quota 
     transferred under this paragraph shall not result in any 
     reduction in the farm poundage quota for the transferring 
     farm if the transferred quota is produced or considered 
     produced on the receiving farm.''; and
       (B) by adding at the end the following:
       ``(4) Transfers in counties with small quotas.--
     Notwithstanding paragraphs (1) and (2), in the case of any 
     county in a State for which the poundage quota allocated to 
     the county was less than 100,000 pounds for the preceding 
     year's crop, all or any part of a farm poundage quota may be 
     transferred by sale or lease or otherwise from a farm in the 
     county to a farm in another county in the same State.''.

     SEC. 156. SUGAR PROGRAM.

       (a) Sugarcane.--The Secretary shall make loans available to 
     processors of domestically grown sugarcane at a rate equal to 
     18 cents per pound for raw cane sugar.
       (b) Sugar Beets.--The Secretary shall make loans available 
     to processors of domestically grown sugar beets at a rate 
     equal to 22.9 cents per pound for refined beet sugar.
       (c) Reduction in Loan Rates.--
       (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 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 
     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) Definitions.--In this subsection:
       (A) Agreement on agriculture.--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)).
       (B) Major sugar countries.--The term ``major sugar growing, 
     producing, and exporting countries'' means--
       (i) the countries of the European Union; and
       (ii) the 10 foreign countries not covered by subparagraph 
     (A) that the Secretary determines produce the greatest 
     quantity of sugar.
       (d) Term of Loans.--
       (1) In general.--A loan 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 the 9-month period beginning on the first 
     day of the first month after the month in which the loan is 
     made; or
       (B) the end of the fiscal year in which the loan is made.
       (2) Supplemental loans.--In the case of a loan 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

[[Page H2729]]

     transfer or delivery of the sugar to a refinery for further 
     processing or marketing); and
       (B) in the case of marketings during each of fiscal years 
     1997 through 2003, 1.375 percent of the loan rate established 
     under subsection (a) per pound of raw cane sugar, processed 
     by the processor from domestically produced sugarcane or 
     sugarcane molasses, that has been marketed (including the 
     transfer or delivery of the sugar to a refinery for further 
     processing or marketing).
       (2) Sugar beets.--Effective for marketings of beet sugar 
     during the 1996 through 2003 fiscal years, the first 
     processor of sugar beets shall remit to the Commodity Credit 
     Corporation a nonrefundable marketing assessment in an amount 
     equal to--
       (A) in the case of marketings during fiscal year 1996, 
     1.1794 percent of the loan rate established under subsection 
     (a) per pound of beet sugar, processed by the processor from 
     domestically produced sugar beets or sugar beet molasses, 
     that has been marketed; and
       (B) in the case of marketings during each of fiscal years 
     1997 through 2003, 1.47425 percent of the loan rate 
     established under subsection (a) per pound of beet sugar, 
     processed by the processor from domestically produced sugar 
     beets or sugar beet molasses, that has been marketed.
       (3) Collection.--
       (A) Timing.--A marketing assessment required under this 
     subsection shall be collected on a monthly basis and shall be 
     remitted to the Commodity Credit Corporation not later than 
     30 days after the end of each month. Any cane sugar or beet 
     sugar processed during a fiscal year that has not been 
     marketed by September 30 of the year shall be subject to 
     assessment on that date. The sugar shall not be subject to a 
     second assessment at the time that it is marketed.
       (B) Manner.--Subject to subparagraph (A), marketing 
     assessments shall be collected under this subsection in the 
     manner prescribed by the Secretary and shall be 
     nonrefundable.
       (4) Penalties.--If any person fails to remit the assessment 
     required by this subsection or fails to comply with such 
     requirements for recordkeeping or otherwise as are required 
     by the Secretary to carry out this subsection, the person 
     shall be liable to the Secretary for a civil penalty up to an 
     amount determined by multiplying--
       (A) the quantity of cane sugar or beet sugar involved in 
     the violation; by
       (B) the loan rate for the applicable crop of sugarcane or 
     sugar beets.
       (5) Enforcement.--The Secretary may enforce this subsection 
     in a court of the United States.
       (g) Forfeiture Penalty.--
       (1) In general.--A penalty shall be assessed on the 
     forfeiture of any sugar pledged as collateral for a 
     nonrecourse loan under this section.
       (2) Cane sugar.--The penalty for cane sugar shall be 1 cent 
     per pound.
       (3) Beet sugar.--The penalty for beet sugar shall bear the 
     same relation to the penalty for cane sugar as the marketing 
     assessment for sugar beets bears to the marketing assessment 
     for sugarcane.
       (4) Effect of forfeiture.--Any payments owed producers by a 
     processor that forfeits any sugar pledged as collateral for a 
     nonrecourse loan shall be reduced in proportion to the loan 
     forfeiture penalty incurred by the processor.
       (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) Crops.--This section (other than subsection (f)) shall 
     be effective only for the 1996 through 2002 crops of sugar 
     beets and sugarcane.
                       Subtitle E--Administration

     SEC. 161. ADMINISTRATION.

       (a) Use of Commodity Credit Corporation.--The Secretary 
     shall carry out this title through the Commodity Credit 
     Corporation.
       (b) Limitation on Expenditure of Commodity Credit 
     Corporation Funds.--
       (1) General powers and responsibilities.--Section 4 of the 
     Commodity Credit Corporation Charter Act (15 U.S.C. 714b) is 
     amended--
       (A) in the first sentence of subsection (g), by inserting 
     before the period the following: ``, except that obligations 
     under all such contracts or agreements (other than 
     reimbursable agreements under section 11) for equipment or 
     services relating to automated data processing, information 
     technologies, or related items (including telecommunications 
     equipment and computer hardware and software) may not exceed 
     $170,000,000 in fiscal year 1996 and not more than 
     $275,000,000 in the 6-fiscal year period beginning on October 
     1, 1996, unless additional amounts for such contracts and 
     agreements are provided in advance in appropriation Acts''; 
     and
       (B) in subsection (h), by striking ``shall have power to 
     acquire personal property necessary to the conduct of its 
     business but''.
       (2) Reimbursable agreements.--Section 11 of the Commodity 
     Credit Corporation Charter Act (15 U.S.C. 714i) is amended by 
     adding at the end the following: ``After September 30, 1996, 
     the total amount of all allotments and fund transfers from 
     the Corporation under this section (including allotments and 
     transfers for automated data processing or information 
     resource management activities) for a fiscal year may not 
     exceed the total amount of the allotments and transfers made 
     under this section in fiscal year 1995.''.
       (3) Reporting requirements.--Section 13 of the Commodity 
     Credit Corporation Charter Act (15 U.S.C. 714k) is amended by 
     adding at the end the following: ``In addition to the annual 
     report, the Corporation shall submit to Congress on a 
     quarterly basis an itemized report of all expenditures over 
     $10,000 made under section 5 or 11 during the period covered 
     by the report, including expenditures in the form of 
     allotments or fund transfers to other agencies and 
     departments of the Federal Government.''.
       (c) Determinations by Secretary.--A determination made by 
     the Secretary under this title shall be final and conclusive.
       (d) Regulations.--Not later than 90 days after the date of 
     enactment of this title, the Secretary and the Commodity 
     Credit Corporation, as appropriate, shall issue such 
     regulations as are necessary to implement this title. The 
     issuance of the regulations shall be made without regard to--
       (1) the notice and comment provisions of section 553 of 
     title 5, United States Code;
       (2) the Statement of Policy of the Secretary of Agriculture 
     effective July 24, 1971 (36 Fed. Reg. 13804) relating to 
     notices of proposed rulemaking and public participation in 
     rulemaking; and
       (3) chapter 35 of title 44, United States Code (commonly 
     know as the ``Paperwork Reduction Act'').

     SEC. 162. ADJUSTMENTS OF LOANS.

       (a) Adjustment Authority.--The Secretary may make 
     appropriate adjustments in the loan rates for any commodity 
     for differences in grade, type, quality, location, and other 
     factors.
       (b) Manner of Adjustment.--The adjustments under the 
     authority of this section 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 title.
       (c) Adjustment on County Basis.--The Secretary may 
     establish loan rates for a crop for producers in individual 
     counties in a manner that results in the lowest such rate 
     being 95 percent of the national average loan rate, except 
     that such action shall not result in an increase in outlays. 
     Adjustments under this subsection shall not result in an 
     increase in the national average loan rate for any year.

     SEC. 163. 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. 164. PERSONAL LIABILITY OF PRODUCERS FOR DEFICIENCIES.

       (a) In General.--Except as provided in subsection (b), no 
     producer shall be personally liable for any deficiency 
     arising from the sale of the collateral securing any 
     nonrecourse loan made under this title unless the loan was 
     obtained through a fraudulent representation by the producer.
       (b) Limitations.--Subsection (a) shall not prevent the 
     Commodity Credit Corporation or the Secretary from requiring 
     a producer to assume liability for--
       (1) a deficiency in the grade, quality, or quantity of a 
     commodity stored on a farm or delivered by the producer;
       (2) a failure to properly care for and preserve a 
     commodity; or
       (3) a failure or refusal to deliver a commodity in 
     accordance with a program established under this title.
       (c) Acquisition of Collateral.--In the case of a 
     nonrecourse loan made under this title or the Commodity 
     Credit Corporation Charter Act (15 U.S.C. 714 et seq.), if 
     the Commodity Credit Corporation acquires title to the 
     unredeemed collateral, the Corporation shall be under no 
     obligation to pay for any market value that the collateral 
     may have in excess of the loan indebtedness.
       (d) 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.

     SEC. 165. COMMODITY CREDIT CORPORATION SALES PRICE 
                   RESTRICTIONS.

       (a) General Sales Authority.--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.
       (b) Nonapplication of Sales Price Restrictions.--Subsection 
     (a) shall not apply to--
       (1) a sale for a new or byproduct use;
       (2) a sale of peanuts or oilseeds for the extraction of 
     oil;
       (3) a sale for seed or feed if the sale will not 
     substantially impair any loan program;
       (4) 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;
       (5) 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;

[[Page H2730]]

       (6) a sale for export, as determined by the Corporation; 
     and
       (7) a sale for other than a primary use.
       (c) Presidential Disaster Areas.--
       (1) In general.--Notwithstanding subsection (a), 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--
       (A) 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
       (B) 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.).
       (2) Costs.--Except on a reimbursable basis, the Corporation 
     shall not bear any costs in connection with making a 
     commodity available under paragraph (1) beyond the cost of 
     the commodity to the Corporation incurred in--
       (A) the storage of the commodity; and
       (B) 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.
       (d) Efficient Operations.--Subsection (a) 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.
             Subtitle F--Permanent Price Support Authority

     SEC. 171. SUSPENSION AND REPEAL OF PERMANENT PRICE SUPPORT 
                   AUTHORITY.

       (a) Agricultural Adjustment Act of 1938.--
       (1) Suspensions.--The following provisions of the 
     Agricultural Adjustment Act of 1938 shall not be applicable 
     to the 1996 through 2002 crops of loan commodities, peanuts, 
     and sugar and shall not be applicable to milk during the 
     period beginning on the date of enactment of this title and 
     ending on December 31, 2002:
       (A) Parts II through V of subtitle B of title III (7 U.S.C. 
     1326-1351).
       (B) Subsections (a) through (j) of section 358 (7 U.S.C. 
     1358).
       (C) Subsections (a) through (h) of section 358a (7 U.S.C. 
     1358a).
       (D) Subsections (a), (b), (d), and (e) of section 358d (7 
     U.S.C. 1359).
       (E) Part VII of subtitle B of title III (7 U.S.C. 1359aa-
     1359jj).
       (F) In the case of peanuts, part I of subtitle C of title 
     III (7 U.S.C. 1361-1368).
       (G) In the case of upland cotton, section 377 (7 U.S.C. 
     1377).
       (H) Subtitle D of title III (7 U.S.C. 1379a-1379j).
       (I) Title IV (7 U.S.C. 1401-1407).
       (2) Reports and records.--Effective only for the 1996 
     through 2002 crops of peanuts, the first sentence of section 
     373(a) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 
     1373(a)) is amended by inserting before ``all brokers and 
     dealers in peanuts'' the following: ``all producers engaged 
     in the production of peanuts,''.
       (b) Agricultural Act of 1949.--
       (1) Suspensions.--The following provisions of the 
     Agricultural Act of 1949 shall not be applicable to the 1996 
     through 2002 crops of loan commodities, peanuts, and sugar 
     and shall not be applicable to milk during the period 
     beginning on the date of enactment of this title and ending 
     on December 31, 2002:
       (A) Section 101 (7 U.S.C. 1441).
       (B) Section 103(a) (7 U.S.C. 1444(a)).
       (C) Section 105 (7 U.S.C. 1444b).
       (D) Section 107 (7 U.S.C. 1445a).
       (E) Section 110 (7 U.S.C. 1445e).
       (F) Section 112 (7 U.S.C. 1445g).
       (G) Section 115 (7 U.S.C. 1445k).
       (H) Section 201 (7 U.S.C. 1446).
       (I) Title III (7 U.S.C. 1447-1449).
       (J) Title IV (7 U.S.C. 1421-1433d), other than sections 
     404, 412, and 416 (7 U.S.C. 1424, 1429, and 1431).
       (K) Title V (7 U.S.C. 1461-1469).
       (L) Title VI (7 U.S.C. 1471-1471j).
       (2) Repeals.--The following provisions of the Agricultural 
     Act of
       (A) Section 101B (7 U.S.C. 1441-2).
       (B) Section 103B (7 U.S.C. 1444-2).
       (C) Section 105B (7 U.S.C. 1444f).
       (D) Section 107B (7 U.S.C. 1445-3a).
       (E) Section 108B (7 U.S.C. 1445c-3).
       (F) Section 113 (7 U.S.C. 1445h).
       (G) Subsections (b) and (c) of section 114 (7 U.S.C. 
     1445j).
       (H) Sections 205, 206, and 207 (7 U.S.C. 1446f, 1446g, and 
     1446h).
       (I) Sections 406 and 427 (7 U.S.C. 1426 and 1433f).
       (3) Potential price support for rice.--Section 101 of the 
     Agricultural Act of 1949 (7 U.S.C. 1441), as suspended by 
     paragraph (1), is amended by adding after subsection (d) the 
     following:
       ``(e) Rice.--The Secretary shall make available to 
     producers of each crop of rice on a farm price support at a 
     level that is not less than 50 percent, or more than 90 
     percent of the parity price for rice as the Secretary 
     determines will not result in increasing stocks of rice to 
     the Commodity Credit Corporation.''.
       (c) Suspension of Certain Quota Provisions.--The joint 
     resolution entitled ``A joint resolution relating to corn and 
     wheat marketing quotas under the Agricultural Adjustment Act 
     of 1938, as amended'', approved May 26, 1941 (7 U.S.C. 1330 
     and 1340), shall not be applicable to the crops of wheat 
     planted for harvest in the calendar years 1996 through 2002.

     SEC. 172. EFFECT OF AMENDMENTS.

       (a) Effect on Prior Crops.--Except as otherwise 
     specifically provided in this title 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 enactment of this title.
       (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 enactment of this title.
     Subtitle G--Commission on 21st Century Production Agriculture

     SEC. 181. ESTABLISHMENT.

       There is established a commission to be known as the 
     ``Commission on 21st Century Production Agriculture'' (in 
     this subtitle referred to as the ``Commission'').

     SEC. 182. 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 1 of the members appointed 
     under each of 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.--A member 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 subtitle 30 days after 6 members of 
     the Commission have been appointed.
       (e) Chairperson.--The chairperson 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. 183. 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 
     enactment of this title and the extent to which the changes 
     are the result of this title and the amendments made by this 
     title. The review shall include the following:
       (1) An assessment of the initial success of production 
     flexibility contracts in supporting the economic viability of 
     farming in the United States.
       (2) An assessment of economic risks to farms delineated by 
     size of farm operation (such as small, medium, or large 
     farms) and region of production.
       (3) 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.
       (4) An assessment of the changes in farmland values and 
     agricultural producer incomes since the date of enactment of 
     this title.
       (5) 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.
       (6) 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.
       (7) An assessment of the effect of any Federal Government 
     interference in agricultural export markets, such as the 
     imposition of trade embargoes, and the degree of 
     implementation and success of international trade agreements 
     and United States export programs.
       (8) 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.

[[Page H2731]]

       (4) An assessment of economic risks to farms delineated by 
     size of farm operation (such as small, medium, or large 
     farms) and region of production.
       (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. 184. 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 183(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 183(b).

     SEC. 185. POWERS.

       (a) Hearings.--The Commission may, for the purpose of 
     carrying out this subtitle, 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 subtitle. On 
     the request of the chairperson 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 shall provide 
     to the Commission appropriate office space and such 
     reasonable administrative and support services as the 
     Commission may request.

     SEC. 186. COMMISSION PROCEDURES.

       (a) Meetings.--The Commission shall meet on a regular basis 
     (as determined by the chairperson) and at the call of the 
     chairperson 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. 187. 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.--
       (1) Appointment.--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 subtitle 
     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.
       (2) Limitation on compensation.--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.--On the request of the chairperson 
     of the Commission, the head of any department or agency of 
     the Federal Government is authorized to detail, without 
     reimbursement, any personnel of the department or agency to 
     the Commission to assist the Commission in carrying out its 
     duties under this section. The detail of any individual may 
     not result in the interruption or loss of civil service 
     status or other privilege of the individual.

     SEC. 188. TERMINATION OF COMMISSION.

       The Commission shall terminate on submission of the final 
     report required by section 184.
             Subtitle H--Miscellaneous Commodity Provisions

     SEC. 191. OPTIONS PILOT PROGRAM.

       (a) Pilot Programs Authorized.--Until December 31, 2002, 
     the Secretary of Agriculture may conduct a pilot program for 
     1 or more agricultural commodities supported under this title 
     to ascertain whether futures and options contracts can 
     provide producers with reasonable protection from the 
     financial risks of fluctuations in price, yield, and income 
     inherent in the production and marketing of the commodities. 
     The pilot program shall be an alternative to other related 
     programs of the Department of Agriculture.
       (b) Distribution of Pilot Program.--For each agricultural 
     commodity included in the pilot program, the Secretary may 
     operate the pilot program in not more than 100 counties, 
     except that not more than 6 of the counties may be located in 
     any 1 State. The pilot program for a commodity shall not be 
     operated in any county for more than 3 of the 1996 through 
     2002 calendar years.
       (c) Eligible Participants.--In operating the pilot program, 
     the Secretary may enter into contract with a producer who--
       (1) is eligible for a production flexibility contract, a 
     marketing assistance loan, or other assistance under this 
     title;
       (2) volunteers to participate in the pilot program;
       (3) operates a farm located in a county selected for the 
     pilot program; and
       (4) meets such other eligibility requirements as the 
     Secretary may establish.
       (d) Notice to Producers.--The Secretary shall provide 
     notice to each producer participating in the pilot program 
     that--
       (1) the participation of the producer is voluntary; and
       (2) neither the United States, the Commodity Credit 
     Corporation, the Federal Crop Insurance Corporation, the 
     Department of Agriculture, nor any other Federal agency is 
     authorized to guarantee that participants in the pilot 
     program will be better or worse off financially as a result 
     of participation in the pilot program than the producer would 
     have been if the producer had not participated in the pilot 
     program.
       (e) Contracts.--The Secretary shall set forth in each 
     contract under the pilot program the terms and conditions for 
     participation in the pilot program and the notice required by 
     subsection (d).
       (f) Eligible Markets.--Trades for futures and options 
     contracts under the pilot program shall be carried out on 
     commodity futures and options markets designated as contract 
     markets under the Commodity Exchange Act (7 U.S.C. 1 et seq.)
       (g) Recordkeeping.--A producer participating in the pilot 
     program shall compile, maintain, and submit (or authorize the 
     compilation, maintenance, and submission) of such 
     documentation as the regulations governing the pilot program 
     require.
       (h) Use of Commodity Credit Corporation.--The Secretary 
     shall fund and operate the pilot program through the 
     Commodity Credit Corporation. To the maximum extent 
     practicable, the Secretary shall operate the pilot program in 
     a budget neutral manner.
       (i) Conforming Repeal.--The Options Pilot Program Act of 
     1990 (subtitle E of title XI of Public Law 101-624; 7 U.S.C. 
     1421 note) is repealed.

     SEC. 192. RISK MANAGEMENT EDUCATION.

       In consultation with the Commodity Futures Trading 
     Commission, the Secretary shall provide such education in 
     management of the financial risks inherent in the production 
     and marketing of agricultural commodities as the Secretary 
     considers appropriate. As part of such educational 
     activities, the Secretary may develop and implement programs 
     to facilitate the participation of agricultural producers in 
     commodity futures trading programs, forward contracting 
     options, and insurance protection programs by assisting and 
     training producers in the usage of such programs. In 
     implementing this authority, the Secretary may use existing 
     research and extension authorities and resources of the 
     Department of Agriculture.

     SEC. 193. CROP INSURANCE.

       (a) Catastrophic Risk Protection.--
       (1) Single delivery.--Section 508(b)(4) of the Federal Crop 
     Insurance Act (7 U.S.C. 1508(b)(4)) is amended 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 of the State 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 (or 
     a portion of a State) as determined by the Secretary, only 
     approved insurance providers may provide the coverage in the 
     State or portion of the State.
       ``(iii) Timing of determinations.--Not later than 90 days 
     after the date of enactment of this subparagraph, the 
     Secretary shall announce the results of the determinations 
     under clause (i) for policies for the 1997 crop year. For 
     subsequent crop years, the Secretary shall make the 
     announcement not later than April 30 of the year preceding 
     the year in which the crop will be produced, or at such other 
     times during the year as the Secretary finds practicable in 
     consultation with affected crop insurance providers for those 
     States (or portions of States) in which catastrophic coverage 
     remains available through local offices of the Department.
       ``(iv) Current policies.--This clause shall take effect 
     beginning with the 1997 crop year. Subject to clause (ii) all 
     catastrophic risk protection policies written by local 
     offices of the Department shall be transferred to the 
     approved insurance provider for performance of all sales, 
     service, and loss adjustment functions. Any fees in 
     connection with such policies that are not yet collected at 
     the time of the transfer shall be payable to the approved 
     insurance providers assuming the policies. The transfer 
     process for policies for the 1997 crop year with sales 
     closing dates before January 1, 1997, shall begin at the time 
     of the Secretary's announcement under clause (iii) and be 
     completed by the sales closing date for the crop and county. 
     The transfer process for all subsequent policies (including 
     policies for the 1998 and subsequent crop years) shall begin 
     at a date that permits the process to be completed not later 
     than 45 days before the sales closing date.''.
       (2) Waiver of mandatory linkage.--Section 508(b)(7) of the 
     Federal Crop Insurance Act (7 U.S.C. 1508(b)(7)) is amended 
     by striking subparagraph (A) and inserting the following:
       ``(A) In general.--Effective for the spring-planted 1996 
     and subsequent crops (and fall-planted 1996 crops at the 
     option of the Secretary), to be eligible for any payment or 
     loan under the Agricultural Market Transition Act, 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--

[[Page H2732]]

       ``(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.''.
       (3) Special rule for 1996.--
       (A) Effective period.--This paragraph shall apply only to 
     the 1996 crop year.
       (B) Availability.--During a period of not less than 2 
     weeks, but not more than 4 weeks, beginning on the date of 
     enactment of this title, the Secretary shall provide 
     producers with an opportunity to obtain catastrophic risk 
     protection insurance under section 508(b) of the Federal Crop 
     Insurance Act (7 U.S.C. 1508(b)) for a spring-planted crop, 
     and limited additional coverage for malting barley under the 
     Malting Barley Price and Quality Endorsement. The Federal 
     Crop Insurance Corporation may attach such limitations and 
     restrictions on obtaining insurance during this period as the 
     Corporation considers necessary to maintain the actuarial 
     soundness of the crop insurance program.
       (C) Attachment.--Insurance coverage under any policy 
     obtained under this paragraph during the extended sales 
     period shall not attach until 10 days after the application.
       (D) Cancellation.--During the extended period, a producer 
     may cancel a catastrophic risk protection policy if--
       (i) the policy is a continuation of a policy that was 
     obtained for a previous crop year; and
       (ii) the cancellation request is made before the acreage 
     reporting date for the policy for the 1996 crop year.
       (b) Crop Insurance Pilot Project.--
       (1) Coverage.--The Secretary of Agriculture shall develop 
     and administer a pilot project for crop insurance coverage 
     that indemnifies crop losses due to a natural disaster such 
     as insect infestation or disease.
       (2) Actuarial soundness.--A pilot project under this 
     paragraph shall be actuarially sound, as determined by the 
     Secretary and administered at no net cost.
       (3) Duration.--A pilot project under this paragraph shall 
     be of two years' duration.
       (c) Crop Insurance for Nursery Crops.--Section 508(a)(6) of 
     the Federal Crop Insurance Act (7 U.S.C. 1508(a)(6)) is 
     amended by adding at the end the following:
       ``(D) Addition of nursery crops.--Not later than 2 years 
     after the date of enactment of this subparagraph, the 
     Corporation shall conduct a study and limited pilot program 
     on the feasibility of insuring nursery crops.''.
       (d) Marketing Windows.--Section 508(j) of the Federal Crop 
     Insurance Act (7 U.S.C. 1508(j)) is amended by adding at the 
     end the following:
       ``(4) Marketing windows.--The Corporation shall consider 
     marketing windows in determining whether it is feasible to 
     require planting during a crop year.''.
       (e) Funding.--
       (1) Mandatory expenses.--Section 516(a)(2) of the Federal 
     Crop Insurance Act (7 U.S.C. 1516(a)(2)) is amended--
       (A) by inserting ``and'' at the end of subparagraph (A);
       (B) by striking ``; and'' at the end of subparagraph (B) 
     and inserting a period; and
       (C) by striking subparagraph (C).
       (2) Funding of sales commissions.--Section 516(b) of the 
     Federal Crop Insurance Act (7 U.S.C. 1516(b)) is amended--
       (A) in paragraph (1)--
       (i) by striking ``(A) In general'' and all that follows 
     through ``subparagraph (B), in'' and inserting ``In''; and
       (ii) by striking subparagraph (B); and
       (B) in paragraph (2)(B), by striking ``subject to paragraph 
     (1)(B),''.
       (3) Other expenses.--Section 516(b)(2)(A) of the Federal 
     Crop Insurance Act (7 U.S.C. 1516(b)(2)(A)) is amended by 
     striking ``, noninsured assistance benefits,''.
       (f) Limitation on Multiple Benefits for Same Loss.--Section 
     508 of the Federal Crop Insurance Act (7 U.S.C. 1508) is 
     amended by adding at the end the following:
       ``(n) Limitation on Multiple Benefits for Same Loss.--If a 
     producer who is eligible to receive benefits under 
     catastrophic risk protection under subsection (b) is also 
     eligible to receive assistance for the same loss under any 
     other program administered by the Secretary, the producer 
     shall be required to elect whether to receive benefits under 
     this title or under the other program, but not both. A 
     producer who purchases additional coverage under subsection 
     (c) may also receive assistance for the same loss under other 
     programs administered by the Secretary, except that the 
     amount received for the loss under the additional coverage 
     together with the amount received under the other programs 
     may not exceed the amount of the actual loss of the 
     producer.''.

     SEC. 194. 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) Appointment.--The Office of Risk Management shall be 
     headed by an Administrator who shall be appointed by the 
     Secretary.
       ``(2) Manager.--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.--From funds appropriated for 
     the salaries and expenses of the Consolidated Farm Service 
     Agency in the Agriculture, Rural Development, Food and Drug 
     Administration, and Related Agencies Appropriations Act, 1996 
     (Public Law 104-37), the Secretary of Agriculture may use 
     such sums as necessary for the salaries and expenses of the 
     Office of Risk Management established under subsection (a).
       (c) Conforming Amendment.--Section 226(b) of the Act (7 
     U.S.C. 6932(b)) is amended by striking paragraph (2).

     SEC. 195. REVENUE INSURANCE.

       Section 508(h) of the Federal Crop Insurance Act (7 U.S.C. 
     1508(h)) is amended by adding at the end the following:
       ``(9) Revenue insurance pilot program.--
       ``(A) In general.--Not later than December 31, 1996, the 
     Secretary shall carry out a pilot program in a limited number 
     of counties, as determined by the Secretary, for crop years 
     1997, 1998, 1999, and 2000, under which a producer of wheat, 
     feed grains, soybeans, or such other commodity as the 
     Secretary considers appropriate may elect to receive 
     insurance against loss of revenue, as determined by the 
     Secretary.
       ``(B) Administration.--Revenue insurance under this 
     paragraph shall--
       ``(i) be offered through reinsurance arrangements with 
     private insurance companies;
       ``(ii) offer at least a minimum level of coverage that is 
     an alternative to catastrophic crop insurance;
       ``(iii) be actuarially sound; and
       ``(iv) require the payment of premiums and administrative 
     fees by an insured producer.''.

     SEC. 196. ADMINISTRATION AND OPERATION OF NONINSURED CROP 
                   ASSISTANCE PROGRAM.

       (a) Operation and Administration of Program.--
       (1) In general.--In the case of an eligible crop described 
     in paragraph (2), the Secretary of Agriculture shall operate 
     a noninsured crop disaster assistance program to provide 
     coverage equivalent to the catastrophic risk protection 
     otherwise available under section 508(b) of the Federal Crop 
     Insurance Act (7 U.S.C. 1508(b)). The Secretary shall carry 
     out this section through the Consolidated Farm Service Agency 
     (in this section referred to as the ``Agency'').
       (2) Eligible crops.--
       (A) In general.--In this section, the term ``eligible 
     crop'' means each commercial crop or other agricultural 
     commodity (except livestock)--
       (i) for which catastrophic risk protection under section 
     508(b) of the Federal Crop Insurance Act (7 U.S.C. 1508(b)) 
     is not available; and
       (ii) that is produced for food or fiber.
       (B) Crops specifically included.--The term ``eligible 
     crop'' shall include floricultural, ornamental nursery, and 
     Christmas tree crops, turfgrass sod, seed crops, aquaculture 
     (including ornamental fish), and industrial crops.
       (3) Cause of loss.--To qualify for assistance under this 
     section, the losses of the noninsured commodity shall be due 
     to drought, flood, or other natural disaster, as determined 
     by the Secretary.
       (b) Application for Noninsured Crop Disaster Assistance.--
       (1) Timely application.--To be eligible for assistance 
     under this section, a producer shall submit an application 
     for noninsured crop disaster assistance at a local office of 
     the Department. The application shall be in such form, 
     contain such information, and be submitted at such time as 
     the Secretary may require.
       (2) Records.--A producer shall provide records, as required 
     by the Secretary, of crop acreage, acreage yields, and 
     production.
       (3) Acreage reports.--A producer shall provide reports on 
     acreage planted or prevented from being planted, as required 
     by the Secretary, by the designated acreage reporting date 
     for the crop and location as established by the Secretary.
       (c) Loss Requirements.--
       (1) Required area loss.--A producer of an eligible crop 
     shall not receive noninsured crop disaster assistance unless 
     the average yield for that crop, or an equivalent measure in 
     the event yield data are not available, in an area falls 
     below 65 percent of the expected area yield, as established 
     by the Secretary.
       (2) Prevented planting.--Subject to paragraph (1), the 
     Secretary shall make a prevented planting noninsured crop 
     disaster assistance payment if the producer is prevented from

[[Page H2733]]

     planting more than 35 percent of the acreage intended for the 
     eligible crop because of drought, flood, or other natural 
     disaster, as determined by the Secretary.
       (3) Reduced yields.--Subject to paragraph (1), the 
     Secretary shall make a reduced yield noninsured crop disaster 
     assistance payment to a producer if the total quantity of the 
     eligible crop that the producer is able to harvest on any 
     farm is, because of drought, flood, or other natural disaster 
     as determined by the Secretary, less than 50 percent of the 
     expected individual yield for the crop, as determined by the 
     Secretary, factored for the interest of the producer for the 
     crop.
       (d) Payment.--The Secretary shall make available to a 
     producer eligible for noninsured assistance under this 
     section a payment computed by multiplying--
       (1) the quantity that is less than 50 percent of the 
     established yield for the crop; by
       (2)(A) in the case of each of the 1996 through 1998 crop 
     years, 60 percent of the average market price for the crop 
     (or any comparable coverage determined by the Secretary); or
       (B) in the case of each of the 1999 and subsequent crop 
     years, 55 percent of the average market price for the crop 
     (or any comparable coverage determined by the Secretary); by
       (3) a payment rate for the type of crop (as determined by 
     the Secretary) that--
       (A) in the case of a crop that is produced with a 
     significant and variable harvesting expense, reflects the 
     decreasing cost incurred in the production cycle for the crop 
     that is--
       (i) harvested;
       (ii) planted but not harvested; and
       (iii) prevented from being planted because of drought, 
     flood, or other natural disaster (as determined by the 
     Secretary); and
       (B) in the case of a crop that is not produced with a 
     significant and variable harvesting expense, is determined by 
     the Secretary.
       (e) Yield Determinations.--
       (1) Establishment.--The Secretary shall establish farm 
     yields for purposes of providing noninsured crop disaster 
     assistance under this section.
       (2) Actual production history.--The Secretary shall 
     determine yield coverage using the actual production history 
     of the producer over a period of not less than the 4 previous 
     consecutive crop years and not more than 10 consecutive crop 
     years. Subject to paragraph (3), the yield for the year in 
     which noninsured crop disaster assistance is sought shall be 
     equal to the average of the actual production history of the 
     producer during the period considered.
       (3) Assignment of yield.--If a producer does not submit 
     adequate documentation of production history to determine a 
     crop yield under paragraph (2), the Secretary shall assign to 
     the producer a yield equal to not less than 65 percent of the 
     transitional yield of the producer (adjusted to reflect 
     actual production reflected in the records acceptable to the 
     Secretary for continuous years), as specified in regulations 
     issued by the Secretary based on production history 
     requirements.
       (4) Prohibition on assigned yields in certain counties.--
       (A) In general.--
       (i) Documentation.--If sufficient data are available to 
     demonstrate that the acreage of a crop in a county for the 
     crop year has increased by more than 100 percent over any 
     year in the preceding 7 crop years or, if data are not 
     available, if the acreage of the crop in the county has 
     increased significantly from the previous crop years, a 
     producer must provide such detailed documentation of 
     production costs, acres planted, and yield for the crop year 
     for which benefits are being claimed as is required by the 
     Secretary. If the Secretary determines that the documentation 
     provided is not sufficient, the Secretary may require 
     documenting proof that the crop, had the crop been harvested, 
     could have been marketed at a reasonable price.
       (ii) Prohibition.--Except as provided in subparagraph (B), 
     a producer who produces a crop on a farm located in a county 
     described in clause (i) may not obtain an assigned yield.
       (B) Exception.--A crop or a producer shall not be subject 
     to this subsection if--
       (i) the planted acreage of the producer for the crop has 
     been inspected by a third party acceptable to the Secretary; 
     or
       (ii)(I) the County Executive Director and the State 
     Executive Director recommend an exemption from the 
     requirement to the Administrator of the Agency; and
       (II) the Administrator approves the recommendation.
       (5) Limitation on receipt of subsequent assigned yield.--A 
     producer who receives an assigned yield for the current year 
     of a natural disaster because required production records 
     were not submitted to the local office of the Department 
     shall not be eligible for an assigned yield for the year of 
     the next natural disaster unless the required production 
     records of the previous 1 or more years (as applicable) are 
     provided to the local office.
       (6) Yield variations due to different farming practices.--
     The Secretary shall ensure that noninsured crop disaster 
     assistance accurately reflects significant yield variations 
     due to different farming practices, such as between irrigated 
     and nonirrigated acreage.
       (f) Contract Payments.--A producer who has received a 
     guaranteed payment for production, as opposed to delivery, of 
     a crop pursuant to a contract shall have the production of 
     the producer adjusted upward by the amount of the production 
     equal to the amount of the contract payment received.
       (g) Use of Commodity Credit Corporation.--The Secretary may 
     use the funds of the Commodity Credit Corporation to carry 
     out this section.
       (h) Exclusions.--Noninsured crop disaster assistance under 
     this section shall not cover losses due to--
       (1) the neglect or malfeasance of the producer;
       (2) the failure of the producer to reseed to the same crop 
     in those areas and under such circumstances where it is 
     customary to reseed; or
       (3) the failure of the producer to follow good farming 
     practices, as determined by the Secretary.
       (i) Payment and Income Limitations.--
       (1) Definitions.--In this subsection:
       (A) Person.--The term ``person'' has the meaning provided 
     the term in regulations issued by the Secretary. The 
     regulations shall conform, to the extent practicable, to the 
     regulations defining the term ``person'' issued under section 
     1001 of the Food Security Act of 1985 (7 U.S.C. 1308).
       (B) Qualifying gross revenues.--The term ``qualifying gross 
     revenues'' means--
       (i) if a majority of the gross revenue of the person is 
     received from farming, ranching, and forestry operations, the 
     gross revenue from the farming, ranching, and forestry 
     operations of the person; and
       (ii) if less than a majority of the gross revenue of the 
     person is received from farming, ranching, and forestry 
     operations, the gross revenue of the person from all sources.
       (2) Payment limitation.--The total amount of payments that 
     a person shall be entitled to receive annually under this 
     section may not exceed $100,000.
       (3) Limitation on multiple benefits for same loss.--If a 
     producer who is eligible to receive benefits under this 
     section is also eligible to receive assistance for the same 
     loss under any other program administered by the Secretary, 
     the producer shall be required to elect whether to receive 
     benefits under this section or under the other program, but 
     not both.
       (4) Income limitation.--A person who has qualifying gross 
     revenues in excess of the amount specified in section 2266(a) 
     of the Food, Agriculture, Conservation, and Trade Act of 1990 
     (7 U.S.C. 1421 note) (as in effect on November 28, 1990) 
     during the taxable year (as determined by the Secretary) 
     shall not be eligible to receive any noninsured assistance 
     payment under this section.
       (5) Regulations.--The Secretary shall issue regulations 
     prescribing such rules as the Secretary determines necessary 
     to ensure a fair and equitable application of section 1001 of 
     the Food Security Act of 1985 (7 U.S.C. 1308), the general 
     payment limitation regulations of the Secretary, and the 
     limitations established under this subsection.
       (j) Conforming Repeal.--Section 519 of the Federal Crop 
     Insurance Act (7 U.S.C. 1519) is repealed.
                      TITLE II--AGRICULTURAL TRADE
Subtitle A--Amendments to Agricultural Trade Development and Assistance 
                    Act of 1954 and Related Statutes

     SEC. 201. FOOD AID TO DEVELOPING COUNTRIES.

       (a) In General.--Section 3 of the Agricultural Trade 
     Development and Assistance Act of 1954 (7 U.S.C. 1691a) is 
     amended to read as follows:

     ``SEC. 3. FOOD AID TO DEVELOPING COUNTRIES.

       ``(a) Policy.--In light of the Uruguay Round Agreement on 
     Agriculture and the Ministerial Decision on Measures 
     Concerning the Possible Negative Effects of the Reform 
     Program on Least-Developed and Net-Food Importing Developing 
     Countries, the United States reaffirms the commitment of the 
     United States to providing food aid to developing countries.
       ``(b) Sense of Congress.--It is the sense of Congress 
     that--
       ``(1) the President should initiate consultations with 
     other donor nations to consider appropriate levels of food 
     aid commitments to meet the legitimate needs of developing 
     countries; and
       ``(2) the United States should increase its contribution of 
     bona fide food assistance to developing countries consistent 
     with the Agreement on Agriculture.''.
       (b) Conforming Amendment.--Section 411 of the Uruguay Round 
     Agreements Act is amended by striking subsection (e) (19 
     U.S.C. 3611).

     SEC. 202. TRADE AND DEVELOPMENT ASSISTANCE.

       Section 101 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1701) is amended--
       (1) by striking ``developing countries'' each place it 
     appears and inserting ``developing countries and private 
     entities''; and
       (2) in subsection (b), by inserting ``and entities'' before 
     the period at the end.

     SEC. 203. AGREEMENTS REGARDING ELIGIBLE COUNTRIES AND PRIVATE 
                   ENTITIES.

       Section 102 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1702) is amended to read as 
     follows:

     ``SEC. 102. AGREEMENTS REGARDING ELIGIBLE COUNTRIES AND 
                   PRIVATE ENTITIES.

       ``(a) Priority.--In selecting agreements to be entered into 
     under this title, the Secretary shall give priority to 
     agreements providing for the export of agricultural 
     commodities to developing countries that--
       ``(1) have the demonstrated potential to become commercial 
     markets for competitively priced United States agricultural 
     commodities;
       ``(2) are undertaking measures for economic development 
     purposes to improve food security and agricultural 
     development, alleviate poverty, and promote broad-based 
     equitable and sustainable development; and
       ``(3) demonstrate the greatest need for food.
       ``(b) Private Entities.--An agreement entered into under 
     this title with a private entity shall require such security, 
     or such other provisions as the Secretary determines 
     necessary, to provide reasonable and adequate assurance of 
     repayment of the financing extended to the private entity.
       ``(c) Agricultural Market Development Plan.--

[[Page H2734]]

       ``(1) Definition of agricultural trade organization.--In 
     this subsection, the term `agricultural trade organization' 
     means a United States agricultural trade organization that 
     promotes the export and sale of a United States agricultural 
     commodity and that does not stand to profit directly from the 
     specific sale of the commodity.
       ``(2) Plan.--The Secretary shall consider a developing 
     country for which an agricultural market development plan has 
     been approved under this subsection to have the demonstrated 
     potential to become a commercial market for competitively 
     priced United States agricultural commodities for the purpose 
     of granting a priority under subsection (a).
       ``(3) Requirements.--
       `(A) In general.--To be approved by the Secretary, an 
     agricultural market development plan shall--
       ``(i) be submitted by a developing country or private 
     entity, in conjunction with an agricultural trade 
     organization;
       ``(ii) describe a project or program for the development 
     and expansion of a commercial market for a United States 
     agricultural commodity in a developing country, and the 
     economic development of the country, using funds derived from 
     the sale of agricultural commodities received under an 
     agreement described in section 101;
       ``(iii) provide for any matching funds that are required by 
     the Secretary for the project or program;
       ``(iv) provide for a results-oriented means of measuring 
     the success of the project or program; and
       ``(v) provide for graduation to the use of non-Federal 
     funds to carry out the project or program, consistent with 
     requirements established by the Secretary.
       ``(B) Agricultural trade organization.--The project or 
     program shall be designed and carried out by the agricultural 
     trade organization.
       ``(C) Additional requirements.--An agricultural market 
     development plan shall contain such additional requirements 
     as are determined necessary by the Secretary.
       ``(4) Administrative costs.--
       ``(A) In general.--The Secretary may make funds made 
     available to carry out this title available for the 
     reimbursement of administrative expenses incurred by 
     agricultural trade organizations in developing, implementing, 
     and administering agricultural market development plans, 
     subject to such requirements and in such amounts as the 
     Secretary considers appropriate.
       ``(B) Duration.--The funds may be made available to 
     agricultural trade organizations for the duration of the 
     applicable agricultural market development plan.
       ``(C) Termination.--The Secretary may terminate assistance 
     made available under this subsection if the agricultural 
     trade organization is not carrying out the approved 
     agricultural market development plan.''.

     SEC. 204. TERMS AND CONDITIONS OF SALES.

       Section 103 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1703) is amended--
       (1) in subsection (a)(2)(A)--
       (A) by striking ``a recipient country to make''; and
       (B) by striking ``such country'' and inserting ``the 
     appropriate country'';
       (2) in subsection (c), by striking ``less than 10 nor''; 
     and
       (3) in subsection (d)--
       (A) by striking ``recipient country'' and inserting 
     ``developing country or private entity''; and
       (B) by striking ``7'' and inserting ``5''.

     SEC. 205. USE OF LOCAL CURRENCY PAYMENT.

       Section 104 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1704) is amended--
       (1) in subsection (a), by striking ``recipient country'' 
     and inserting ``developing country or private entity''; and
       (2) in subsection (c)--
       (A) by striking ``recipient country'' each place it appears 
     and inserting ``appropriate developing country''; and
       (B) in paragraph (3), by striking ``recipient countries'' 
     and inserting ``appropriate developing countries''.

     SEC. 206. VALUE-ADDED FOODS.

       Section 105 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1705) is repealed.

     SEC. 207. ELIGIBLE ORGANIZATIONS.

       (a) In General.--Section 202 of the Agricultural Trade 
     Development and Assistance Act of 1954 (7 U.S.C. 1722) is 
     amended--
       (1) by striking subsection (b) and inserting the following:
       ``(b) Nonemergency Assistance.--
       ``(1) In general.--The Administrator may provide 
     agricultural commodities for nonemergency assistance under 
     this title through eligible organizations (as described in 
     subsection (d)) that have entered into an agreement with the 
     Administrator to use the commodities in accordance with this 
     title.
       ``(2) Limitation.--The Administrator may not deny a request 
     for funds submitted under this subsection because the program 
     for which the funds are requested--
       ``(A) would be carried out by the eligible organization in 
     a foreign country in which the Agency for International 
     Development does not have a mission, office, or other 
     presence; or
       ``(B) is not part of a development plan for the country 
     prepared by the Agency.''; and
       (2) in subsection (e)--
       (A) in the subsection heading, by striking ``Private 
     Voluntary Organizations and Cooperatives'' and inserting 
     ``Eligible Organizations'';
       (B) in paragraph (1)--
       (i) by striking ``$13,500,000'' and inserting 
     ``$28,000,000''; and
       (ii) by striking ``private voluntary organizations and 
     cooperatives to assist such organizations and cooperatives'' 
     and inserting ``eligible organizations described in 
     subsection (d), to assist the organizations'';
       (C) by striking paragraph (2) and inserting the following:
       ``(2) Request for funds.--To receive funds made available 
     under paragraph (1), an eligible organization described in 
     subsection (d) shall submit a request for the funds that is 
     subject to approval by the Administrator.''; and
       (D) in paragraph (3), by striking ``a private voluntary 
     organization or cooperative, the Administrator may provide 
     assistance to that organization or cooperative'' and 
     inserting ``an eligible organization, the Administrator may 
     provide assistance to the eligible organization''.
       (b) Conforming Amendments.--Section 207 of the Agricultural 
     Trade Development and Assistance Act of 1954 (7 U.S.C. 1726a) 
     is amended--
       (1) in subsection (a)(1), by striking ``a private voluntary 
     organization or cooperative'' each place it appears and 
     inserting ``an eligible organization''; and
       (2) in subsection (b)--
       (A) in paragraph (1), by striking ``private voluntary 
     organizations and cooperatives'' and inserting ``eligible 
     organizations''; and
       (B) in paragraph (2), by striking ``organizations, 
     cooperatives,'' and inserting ``eligible organizations''.

     SEC. 208. GENERATION AND USE OF FOREIGN CURRENCIES.

       Section 203 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1723) is amended--
       (1) in subsection (a), by inserting ``, or in a country in 
     the same region,'' after ``in the recipient country'';
       (2) in subsection (b)--
       (A) by inserting ``or in countries in the same region,'' 
     after ``in recipient countries,''; and
       (B) by striking ``10 percent'' and inserting ``15 
     percent'';
       (3) in subsection (c), by inserting ``or in a country in 
     the same region,'' after ``in the recipient country,''; and
       (4) in subsection (d)(2), by inserting ``or within a 
     country in the same region'' after ``within the recipient 
     country''.

     SEC. 209. GENERAL LEVELS OF ASSISTANCE UNDER PUBLIC LAW 480.

       Section 204 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1724) is amended--
       (1) in subsection (a)--
       (A) in paragraph (1), by striking ``amount that'' and all 
     that follows through the period at the end and inserting 
     ``amount that for each of fiscal years 1996 through 2002 is 
     not less than 2,025,000 metric tons.'';
       (B) in paragraph (2), by striking ``amount that'' and all 
     that follows through the period at the end and inserting 
     ``amount that for each of fiscal years 1996 through 2002 is 
     not less than 1,550,000 metric tons.''; and
       (C) in paragraph (3), by adding at the end the following: 
     ``No waiver shall be made before the beginning of the 
     applicable fiscal year.''; and
       (2) in subsection (b)(1), by inserting before the period at 
     the end the following: ``and that not less than 50 percent of 
     the quantity of the bagged commodities that are whole grain 
     commodities be bagged in the United States''.

     SEC. 210. FOOD AID CONSULTATIVE GROUP.

       Section 205 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1725) is amended--
       (1) in subsection (a), by striking ``private voluntary 
     organizations, cooperatives and indigenous non-governmental 
     organizations'' and inserting ``eligible organizations 
     described in section 202(d)(1)'';
       (2) in subsection (b)--
       (A) in paragraph (2), by striking ``for International 
     Affairs and Commodity Programs'' and inserting ``of 
     Agriculture for Farm and Foreign Agricultural Services'';
       (B) in paragraph (4), by striking ``and'' at the end;
       (C) in paragraph (5), by striking the period at the end and 
     inserting ``; and''; and
       (D) by adding at the end the following:
       ``(6) representatives from agricultural producer groups in 
     the United States.'';
       (3) in the second sentence of subsection (d), by inserting 
     ``(but at least twice per year)'' after ``when appropriate''; 
     and
       (4) in subsection (f), by striking ``1995'' and inserting 
     ``2002''.

     SEC. 211. SUPPORT OF NONGOVERNMENTAL ORGANIZATIONS.

       (a) In General.--Section 306(b) of the Agricultural Trade 
     Development and Assistance Act of 1954 (7 U.S.C. 1727e(b)) is 
     amended--
       (1) in the subsection heading, by striking ``Indigenous 
     Non-Governmental'' and inserting ``Nongovernmental''; and
       (2) by striking ``utilization of indigenous'' and inserting 
     ``utilization of''.
       (b) Conforming Amendment.--Section 402 of the Agricultural 
     Trade Development and Assistance Act of 1954 (7 U.S.C. 1732) 
     is amended by striking paragraph (6) and inserting the 
     following:
       ``(6) Nongovernmental organization.--The term 
     `nongovernmental organization' means an organization that 
     works at the local level to solve development problems in a 
     foreign country in which the organization is located, except 
     that the term does not include an organization that is 
     primarily an agency or instrumentality of the government of 
     the foreign country.''.

     SEC. 212. COMMODITY DETERMINATIONS.

       Section 401 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1731) is amended--

[[Page H2735]]

       (1) by striking subsections (a) through (d) and inserting 
     the following:
       ``(a) Availability of Commodities.--No agricultural 
     commodity shall be available for disposition under this Act 
     if the Secretary determines that the disposition would reduce 
     the domestic supply of the commodity below the supply needed 
     to meet domestic requirements and provide adequate carryover 
     (as determined by the Secretary), unless the Secretary 
     determines that some part of the supply should be used to 
     carry out urgent humanitarian purposes under this Act.'';
       (2) by redesignating subsections (e) and (f) as subsections 
     (b) and (c), respectively; and
       (3) in subsection (c) (as so redesignated), by striking 
     ``(e)(1)'' and inserting ``(b)(1)''.

     SEC. 213. GENERAL PROVISIONS.

       Section 403 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1733) is amended--
       (1) in subsection (b)--
       (A) in the subsection heading, by striking 
     ``Consultations'' and inserting ``Impact on Local Farmers and 
     Economy''; and
       (B) by striking ``consult with'' and all that follows 
     through ``other donor organizations to'';
       (2) in subsection (c)--
       (A) by striking ``from countries''; and
       (B) by striking ``for use'' and inserting ``or use'';
       (3) in subsection (f)--
       (A) by inserting ``or private entities, as appropriate,'' 
     after ``from countries''; and
       (B) by inserting ``or private entities'' after ``such 
     countries''; and
       (4) in subsection (i)(2), by striking subparagraph (C).

     SEC. 214. AGREEMENTS.

       Section 404 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1734) is amended--
       (1) in subsection (a), by inserting ``with foreign 
     countries'' after ``Before entering into agreements'';
       (2) in subsection (b)(2)--
       (A) by inserting ``with foreign countries'' after ``with 
     respect to agreements entered into''; and
       (B) by inserting before the semicolon at the end the 
     following: ``and broad-based economic growth''; and
       (3) in subsection (c), by striking paragraph (1) and 
     inserting the following:
       ``(1) In general.--Agreements to provide assistance on a 
     multi-year basis to recipient countries or to eligible 
     organizations--
       ``(A) may be made available under titles I and III; and
       ``(B) shall be made available under title II.''.

     SEC. 215. USE OF COMMODITY CREDIT CORPORATION.

       Section 406 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1736) is amended--
       (1) in subsection (a), by striking ``shall'' and inserting 
     ``may'';
       (2) in subsection (b)--
       (A) by striking ``this Act'' and inserting ``titles II and 
     III''; and
       (B) by striking paragraph (4) and inserting the following:
       ``(4) the vessel freight charges from United States ports 
     or designated Canadian transshipment ports, as determined by 
     the Secretary, to designated ports of entry abroad;''; and
       (3) by striking subsection (d).

     SEC. 216. ADMINISTRATIVE PROVISIONS.

       Section 407 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1736a) is amended--
       (1) in subsection (a)--
       (A) in paragraph (1), by inserting ``or private entity that 
     enters into an agreement under title I'' after ``importing 
     country''; and
       (B) in paragraph (2), by adding at the end the following: 
     ``Resulting contracts may contain such terms and conditions 
     as the Secretary determines are necessary and appropriate.'';
       (2) in subsection (c)--
       (A) in paragraph (1)(A), by inserting ``importer or'' 
     before ``importing country''; and
       (B) in paragraph (2)(A), by inserting ``importer or'' 
     before ``importing country'';
       (3) in subsection (d)--
       (A) by striking paragraph (2) and inserting the following:
       ``(2) Freight procurement.--Notwithstanding the Federal 
     Property and Administrative Services Act of 1949 (40 U.S.C. 
     471 et seq.) or other similar provisions of law relating to 
     the making or performance of Federal Government contracts, 
     ocean transportation under titles II and III may be procured 
     on the basis of full and open competitive procedures. 
     Resulting contracts may contain such terms and conditions as 
     the Administrator determines are necessary and 
     appropriate.''; and
       (B) by striking paragraph (4);
       (4) in subsection (g)(2)--
       (A) in subparagraph (B), by striking ``and'' at the end;
       (B) in subparagraph (C), by striking the period at the end 
     and inserting ``; and''; and
       (C) by adding at the end the following:
       ``(D) an assessment of the progress towards achieving food 
     security in each country receiving food assistance from the 
     United States Government, with special emphasis on the 
     nutritional status of the poorest populations in each 
     country.''; and
       (5) by striking subsection (h).

     SEC. 217. EXPIRATION DATE.

       Section 408 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1736b) is amended by 
     striking ``1995'' and inserting ``2002''.

     SEC. 218. REGULATIONS.

       Section 409 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1736c) is repealed.

     SEC. 219. INDEPENDENT EVALUATION OF PROGRAMS.

       Section 410 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1736d) is repealed.

     SEC. 220. AUTHORIZATION OF APPROPRIATIONS.

       Section 412 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1736f) is amended--
       (1) by striking subsections (b) and (c) and inserting the 
     following:
       ``(b) Transfer of Funds.--
       ``(1) In general.--Except as provided in paragraph (2) and 
     notwithstanding any other provision of law, the President may 
     direct that up to 15 percent of the funds available for any 
     fiscal year for carrying out any title of this Act be used to 
     carry out any other title of this Act.
       ``(2) Title iii funds.--The President may direct that up to 
     50 percent of the funds available for any fiscal year for 
     carrying out title III be used to carry out title II.''; and
       (2) by redesignating subsections (d) and (e) as subsections 
     (c) and (d), respectively.

     SEC. 221. COORDINATION OF FOREIGN ASSISTANCE PROGRAMS.

       Section 413 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1736g) is amended by 
     striking ``this Act'' each place it appears and inserting 
     ``title III''.

     SEC. 222. MICRONUTRIENT FORTIFICATION PILOT PROGRAM.

       Title IV of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1731 et seq.) is amended by 
     adding at the end the following:

     ``SEC. 415. MICRONUTRIENT FORTIFICATION PILOT PROGRAM.

       ``(a) In General.--Subject to the availability of practical 
     technology and to cost effectiveness, not later than 
     September 30, 1997, the Secretary, in consultation with the 
     Administrator, shall establish a micronutrient fortification 
     pilot program under this Act. The purpose of the program 
     shall be to--
       ``(1) assist developing countries in correcting 
     micronutrient dietary deficiencies among segments of the 
     populations of the countries; and
       ``(2) encourage the development of technologies for the 
     fortification of whole grains and other commodities that are 
     readily transferable to developing countries.
       ``(b) Selection of Participating Countries.--From among the 
     countries eligible for assistance under this Act, the 
     Secretary may select not more than 5 developing countries to 
     participate in the pilot program.
       ``(c) Fortification.--Under the pilot program, whole grains 
     and other commodities made available to a developing country 
     selected to participate in the pilot program may be fortified 
     with 1 or more micronutrients (including vitamin A, iron, and 
     iodine) with respect to which a substantial portion of the 
     population in the country is deficient. The commodity may be 
     fortified in the United States or in the developing country.
       ``(d) Termination of Authority.--The authority to carry out 
     the pilot program established under this section shall 
     terminate on September 30, 2002.''.

     SEC. 223. USE OF CERTAIN LOCAL CURRENCY.

       Title IV of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1731 et seq.) (as amended by 
     section 222) is amended by adding at the end the following:

     ``SEC. 416. USE OF CERTAIN LOCAL CURRENCY.

       ``Local currency payments received by the United States 
     pursuant to agreements entered into under title I (as in 
     effect on November 27, 1990) may be utilized by the Secretary 
     in accordance with section 108 (as in effect on November 27, 
     1990).''.

     SEC. 224. FARMER-TO-FARMER PROGRAM.

       Section 501 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1737) is amended--
       (1) in subsection (a), by striking paragraph (6) and 
     inserting the following:
       ``(6) to the extent that local currencies can be used to 
     meet the costs of a program established under this section, 
     augment funds of the United States that are available for 
     such a program through the use of foreign currencies that 
     accrue from the sale of agricultural commodities under this 
     Act, and local currencies generated from other types of 
     foreign assistance activities, within the country where the 
     program is being conducted.''; and
       (2) in subsection (c)--
       (A) by striking ``0.2'' and inserting ``0.4'';
       (B) by striking ``1991 through 1995'' and inserting ``1996 
     through 2002''; and
       (C) by striking ``0.1'' and inserting ``0.2''.

     SEC. 225. FOOD SECURITY COMMODITY RESERVE.

       (a) In General.--Title III of the Agricultural Act of 1980 
     (7 U.S.C. 1736f-1 et seq.) is amended to read as follows:
              ``TITLE III--FOOD SECURITY COMMODITY RESERVE

     ``SEC. 301. SHORT TITLE.

       ``This title may be cited as the `Food Security Commodity 
     Reserve Act of 1996'.

     ``SEC. 302. ESTABLISHMENT OF COMMODITY RESERVE.

       ``(a) In General.--To provide for a reserve solely to meet 
     emergency humanitarian food needs in developing countries, 
     the Secretary of Agriculture (referred to in this title as 
     the `Secretary') shall establish a reserve stock of wheat, 
     rice, corn, or sorghum, or any combination of the 
     commodities, totalling not more than 4,000,000 metric tons 
     for use as described in subsection (c).
       ``(b) Commodities in Reserve.--
       ``(1) In general.--The reserve established under this 
     section shall consist of--
       ``(A) wheat in the reserve established under the Food 
     Security Wheat Reserve Act of 1980 as of the date of 
     enactment of the Federal Agriculture Improvement and Reform 
     Act of 1996;

[[Page H2736]]

       ``(B) wheat, rice, corn, and sorghum (referred to in this 
     section as `eligible commodities') acquired in accordance 
     with paragraph (2) to replenish eligible commodities released 
     from the reserve, including wheat to replenish wheat released 
     from the reserve established under the Food Security Wheat 
     Reserve Act of 1980 but not replenished as of the date of 
     enactment of the Federal Agriculture Improvement and Reform 
     Act of 1996; and
       ``(C) such rice, corn, and sorghum as the Secretary may, at 
     such time and in such manner as the Secretary determines 
     appropriate, acquire as a result of exchanging an equivalent 
     value of wheat in the reserve established under this section.
       ``(2) Replenishment of reserve.--
       ``(A) In general.--Subject to subsection (h), commodities 
     of equivalent value to eligible commodities in the reserve 
     established under this section may be acquired--
       ``(i) through purchases--

       ``(I) from producers; or
       ``(II) in the market, if the Secretary determines that the 
     purchases will not unduly disrupt the market; or

       ``(ii) by designation by the Secretary of stocks of 
     eligible commodities of the Commodity Credit Corporation.
       ``(B) Funds.--Any use of funds to acquire eligible 
     commodities through purchases from producers or in the market 
     to replenish the reserve must be authorized in an 
     appropriations Act.
       ``(c) Release of Eligible Commodities.--
       ``(1) Emergency assistance.--
       ``(A) In general.--Notwithstanding paragraph (2), to meet 
     unanticipated need, the Secretary may release eligible 
     commodities in any fiscal year, without regard to the 
     availability of domestic supply of the commodities, to 
     provide emergency assistance to developing countries under 
     title II of the Agricultural Trade Development and Assistance 
     Act of 1954 (7 U.S.C. 1721 et seq.).
       ``(B) Release for emergency assistance.--If the eligible 
     commodities needed to meet unanticipated need cannot be made 
     available in a timely manner under normal means for obtaining 
     eligible commodities for food assistance because of 
     unanticipated need for emergency assistance as provided under 
     section 202(a) of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1722(a)), the Secretary may 
     in any fiscal year release from the reserve--
       ``(i) up to 500,000 metric tons of wheat or the equivalent 
     value of eligible commodities other than wheat; and
       ``(ii) up to 500,000 metric tons of any eligible 
     commodities under this paragraph that could have been 
     released but were not released in prior fiscal years.
       ``(C) Waiver of minimum tonnage requirements.--Nothing in 
     this paragraph shall require a waiver under section 204(a)(3) 
     of the Agricultural Trade Development and Assistance Act of 
     1954 (7 U.S.C. 1724(a)(3)) as a prerequisite for the release 
     of eligible commodities under this paragraph.
       ``(2) Emergency food assistance.--Notwithstanding any other 
     provision of law, eligible commodities designated or acquired 
     for the reserve established under this section may be 
     released by the Secretary to provide, on a donation or sale 
     basis, emergency food assistance to developing countries at 
     such time as the domestic supply of the eligible commodities 
     is so limited that quantities of the eligible commodities 
     cannot be made available for disposition under the 
     Agricultural Trade Development and Assistance Act of 1954 (7 
     U.S.C. 1691 et seq.) (other than disposition for urgent 
     humanitarian purposes under section 401 of the Act (7 U.S.C. 
     1731)).
       ``(3) Processing of eligible commodities.--Eligible 
     commodities that are released from the reserve established 
     under this section may be processed in the United States and 
     shipped to a developing country when conditions in the 
     recipient country require processing.
       ``(4) Exchange.--The Secretary may exchange an eligible 
     commodity for another United States commodity of equal value, 
     including powdered milk, pulses, and vegetable oil.
       ``(5) Use of normal commercial practices.--To the maximum 
     extent practicable consistent with the fulfillment of the 
     purposes of this section and the effective and efficient 
     administration of this section, the Secretary shall use the 
     usual and customary channels, facilities, arrangements, and 
     practices of trade and commerce to carry out this subsection.
       ``(d) Management of Eligible Commodities.--The Secretary 
     shall provide--
       ``(1) for the management of eligible commodities in the 
     reserve established under this section as to location and 
     quality of eligible commodities needed to meet emergency 
     situations; and
       ``(2) for the periodic rotation or replacement of stocks of 
     eligible commodities in the reserve to avoid spoilage and 
     deterioration of the commodities.
       ``(e) Treatment of Reserve Under Other Law.--Eligible 
     commodities in the reserve established under this section 
     shall not be--
       ``(1) considered a part of the total domestic supply 
     (including carryover) for the purpose of subsection (c) or 
     for the purpose of administering the Agricultural Trade 
     Development and Assistance Act of 1954 (7 U.S.C. 1691 et 
     seq.); and
       ``(2) subject to any quantitative limitation on exports 
     that may be imposed under section 7 of the Export 
     Administration Act of 1979 (50 U.S.C. App. 2406).
       ``(f) Use of Commodity Credit Corporation.--
       ``(1) In general.--Subject to the limitations provided in 
     this section, the funds, facilities, and authorities of the 
     Commodity Credit Corporation shall be used by the Secretary 
     in carrying out this section, except that any restriction 
     applicable to the acquisition, storage, or disposition of 
     eligible commodities owned or controlled by the Commodity 
     Credit Corporation shall not apply.
       ``(2) Reimbursement.--
       ``(A) In general.--The Commodity Credit Corporation shall 
     be reimbursed for the release of eligible commodities from 
     funds made available to carry out the Agricultural Trade 
     Development and Assistance Act of 1954 (7 U.S.C. 1691 et 
     seq.).
       ``(B) Basis for reimbursement.--The reimbursement shall be 
     made on the basis of the lesser of--
       ``(i) the actual costs incurred by the Commodity Credit 
     Corporation with respect to the eligible commodity; or
       ``(ii) the export market price of the eligible commodity 
     (as determined by the Secretary) as of the time the eligible 
     commodity is released from the reserve.
       ``(C) Source of funds.--The reimbursement may be made from 
     funds appropriated for subsequent fiscal years.
       ``(g) Finality of Determination.--Any determination by the 
     Secretary under this section shall be final.
       ``(h) Termination of Authority.--
       ``(1) In general.--The authority to replenish stocks of 
     eligible commodities to maintain the reserve established 
     under this section shall terminate on September 30, 2002.
       ``(2) Disposal of eligible commodities.--Eligible 
     commodities remaining in the reserve after September 30, 
     2002, shall be disposed of by release for use in providing 
     for emergency humanitarian food needs in developing countries 
     as provided in this section.''.
       (b) Conforming Amendment.--Section 208(d) of the 
     Agricultural Trade Suspension Adjustment Act of 1980 (7 
     U.S.C. 4001(d)) is amended by striking paragraph (2) and 
     inserting the following:
       ``(2) Applicability of certain provisions.--Subsections 
     (c), (d), (e), and (f)(2) of section 302 of the Food Security 
     Commodity Reserve Act of 1996 shall apply to commodities in 
     any reserve established under paragraph (1), except that the 
     references to `eligible commodities' in the subsections shall 
     be deemed to be references to `agricultural commodities'.''.

     SEC. 226. PROTEIN BYPRODUCTS DERIVED FROM ALCOHOL FUEL 
                   PRODUCTION.

       Section 1208 of the Agriculture and Food Act of 1981 (7 
     U.S.C. 1736n) is repealed.

     SEC. 227. FOOD FOR PROGRESS PROGRAM.

       The Food for Progress Act of 1985 (7 U.S.C. 1736o) is 
     amended--
       (1) in subsection (b)--
       (A) in paragraph (1)--
       (i) by striking ``(b)(1)'' and inserting ``(b)''; and
       (ii) in the first sentence, by inserting 
     ``intergovernmental organizations,'' after ``cooperatives,''; 
     and
       (B) by striking paragraph (2);
       (2) in subsection (e)(4), by striking ``203'' and inserting 
     ``406'';
       (3) in subsection (f)--
       (A) in paragraph (1)(B), by striking ``in the case of the 
     independent states of the former Soviet Union,'';
       (B) by striking paragraph (2);
       (C) in paragraph (4), by inserting ``for each of fiscal 
     years 1996 through 2002'' after ``may be used''; and
       (D) by redesignating paragraphs (3) through (5) as 
     paragraphs (2) through (4), respectively;
       (4) in subsection (g), by striking ``1995'' and inserting 
     ``2002'';
       (5) in subsection (j), by striking ``shall'' and inserting 
     ``may'';
       (6) in subsection (k), by striking ``1995'' and inserting 
     ``2002'';
       (7) in subsection (l)(1)--
       (A) by striking ``1991 through 1995'' and inserting ``1996 
     through 2002''; and
       (B) by inserting ``, and to provide technical assistance 
     for monetization programs,'' after ``monitoring of food 
     assistance programs''; and
       (8) in subsection (m)--
       (A) by striking ``with respect to the independent states of 
     the former Soviet Union'';
       (B) by striking ``private voluntary organizations and 
     cooperatives'' each place it appears and inserting 
     ``agricultural trade organizations, intergovernmental 
     organizations, private voluntary organizations, and 
     cooperatives''; and
       (C) in paragraph (2), by striking ``in the independent 
     states''.

     SEC. 228. USE OF FOREIGN CURRENCY PROCEEDS FROM EXPORT SALES 
                   FINANCING.

       Section 402 of the Mutual Security Act of 1954 (22 U.S.C. 
     1922) is repealed.

     SEC. 229. STIMULATION OF FOREIGN PRODUCTION.

       Section 7 of the Act of December 30, 1947 (61 Stat. 947, 
     chapter 526; 50 U.S.C. App. 1917), is repealed.
        Subtitle B--Amendments to Agricultural Trade Act of 1978

     SEC. 241. AGRICULTURAL EXPORT PROMOTION STRATEGY.

       (a) In General.--Section 103 of the Agricultural Trade Act 
     of 1978 (7 U.S.C. 5603) is amended to read as follows:

     ``SEC. 103. AGRICULTURAL EXPORT PROMOTION STRATEGY.

       ``(a) In General.--The Secretary shall develop a strategy 
     for implementing Federal agricultural export promotion 
     programs that takes into account the new market opportunities 
     for agricultural products, including opportunities that 
     result from--
       ``(1) the North American Free Trade Agreement and the 
     Uruguay Round Agreements;
       ``(2) any accession to membership in the World Trade 
     Organization;
       ``(3) the continued economic growth in the Pacific Rim; and
       ``(4) other developments.
       ``(b) Purpose of Strategy.--The strategy developed under 
     subsection (a) shall encourage

[[Page H2737]]

     the maintenance, development, and expansion of export markets 
     for United States agricultural commodities and related 
     products, including high-value and value-added products.
       ``(c) Goals of Strategy.--The strategy developed under 
     subsection (a) shall have the following goals:
       ``(1) Increase the value of United States agricultural 
     exports each year.
       ``(2) Increase the value of United States agricultural 
     exports each year at a faster rate than the rate of increase 
     in the value of overall world export trade in agricultural 
     products.
       ``(3) Increase the value of United States high-value and 
     value-added agricultural exports each year.
       ``(4) Increase the value of United States high-value and 
     value-added agricultural exports each year at a faster rate 
     than the rate of increase in the value of overall world 
     export trade in high-value and value-added agricultural 
     products.
       ``(5) Ensure that to the extent practicable--
       ``(A) all obligations undertaken in the Uruguay Round 
     Agreement on Agriculture that significantly increase access 
     for United States agricultural commodities are implemented to 
     the extent required by the Uruguay Round Agreements; or
       ``(B) applicable United States laws are used to secure 
     United States rights under the Uruguay Round Agreement on 
     Agriculture.
       ``(d) Priority Markets.--
       ``(1) Identification of markets.--In developing the 
     strategy required under subsection (a), the Secretary shall 
     annually identify as priority markets--
       ``(A) those markets in which imports of agricultural 
     products show the greatest potential for increase; and
       ``(B) those markets in which, with the assistance of 
     Federal export promotion programs, exports of United States 
     agricultural products show the greatest potential for 
     increase.
       ``(2) Identification of supporting offices.--The President 
     shall identify annually in the budget of the United States 
     Government submitted under section 1105 of title 31, United 
     States Code, each overseas office of the Foreign Agricultural 
     Service that provides assistance to United States exporters 
     in each of the priority markets identified under paragraph 
     (1).''.
       (b) Sense of Congress.--It is the sense of Congress that--
       (1) the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate should conduct a thorough review 
     of agricultural export and food aid programs not later than 
     December 31, 1998; and
       (2) the review should examine what changes, if any, need to 
     be made in the programs as a result of the effects of the 
     Agricultural Market Transition Act, the Uruguay Round 
     agreements, changing world market conditions, and such other 
     factors as the Committees consider appropriate.
       (c) Elimination of Report.--
       (1) In general.--Section 601 of the Agricultural Trade Act 
     of 1978 (7 U.S.C. 5711) is repealed.
       (2) Conforming amendment.--The last sentence of section 603 
     of the Agricultural Trade Act of 1978 (7 U.S.C. 5713) is 
     amended by striking ``, in a consolidated report,'' and all 
     that follows through ``section 601'' and inserting ``or in a 
     consolidated report''.

     SEC. 242. IMPLEMENTATION OF COMMITMENTS UNDER URUGUAY ROUND 
                   AGREEMENTS.

       (a) In General.--Title I of the Agricultural Trade Act of 
     1978 (7 U.S.C. 5601 et seq.) is amended by adding at the end 
     the following:

     ``SEC. 106. IMPLEMENTATION OF COMMITMENTS UNDER URUGUAY ROUND 
                   AGREEMENTS.

       ``Not later than September 30 of each year, the Secretary 
     shall evaluate whether the obligations undertaken by foreign 
     countries under the Uruguay Round Agreement on Agriculture 
     are being fully implemented. If the Secretary has reason to 
     believe (based on the evaluation) that any foreign country, 
     by not implementing the obligations of the country, may be 
     significantly constraining an opportunity for United States 
     agricultural exports, the Secretary shall--
       ``(1) submit the evaluation to the United States Trade 
     Representative; and
       ``(2) transmit a copy of the evaluation to the Committee on 
     Agriculture, and the Committee on Ways and Means, of the 
     House of Representatives and the Committee on Agriculture, 
     Nutrition, and Forestry, and the Committee on Finance, of the 
     Senate.''.
       (b) Monitoring Compliance With Sanitary and Phytosanitary 
     Measures.--Section 414 of the Agricultural Trade Act of 1978 
     (7 U.S.C. 5674) is amended by adding at the end the 
     following:
       ``(c) Monitoring Compliance With Sanitary and Phytosanitary 
     Measures.--The Secretary shall monitor the compliance of 
     World Trade Organization member countries with the sanitary 
     and phytosanitary measures of the Agreement on Agriculture of 
     the Uruguay Round of Multilateral Trade Negotiations of the 
     General Agreement on Tariffs and Trade. If the Secretary has 
     reason to believe that any country may have failed to meet 
     the commitment on sanitary and phytosanitary measures under 
     the Agreement in a manner that adversely impacts the exports 
     of a United States agricultural commodity, the Secretary 
     shall--
       ``(1) provide such information to the United States Trade 
     Representative of the circumstances surrounding the matter 
     arising under this subsection; and
       ``(2) with respect to any such circumstances that the 
     Secretary considers to have a continuing adverse effect on 
     United States agricultural exports, report to the Committee 
     on Agriculture, and the Committee on Ways and Means, of the 
     House of Representatives and the Committee on Agriculture, 
     Nutrition, and Forestry, and the Committee on Finance, of the 
     Senate--
       ``(A) that a country may have failed to meet the sanitary 
     and phytosanitary commitments; and
       ``(B) any notice given by the Secretary to the United 
     States Trade Representative.''.

     SEC. 243. EXPORT CREDITS.

       (a) Export Credit Guarantee Program.--Section 202 of the 
     Agricultural Trade Act of 1978 (7 U.S.C. 5622) is amended--
       (1) in subsection (a)--
       (A) by striking ``Guarantees.--The'' and inserting the 
     following: ``Guarantees.--
       ``(1) In general.--The''; and
       (B) by adding at the end the following:
       ``(2) Supplier credits.--In carrying out this section, the 
     Commodity Credit Corporation may issue guarantees for the 
     repayment of credit made available for a period of not more 
     than 180 days by a United States exporter to a buyer in a 
     foreign country.'';
       (2) in subsection (f)--
       (A) by striking ``(f) Restrictions.--The'' and inserting 
     the following:
       ``(f) Restrictions.--
       ``(1) In general.--The''; and
       (B) by adding at the end the following:
       ``(2) Criteria for determination.--In making the 
     determination required under paragraph (1) with respect to 
     credit guarantees under subsection (b) for a country, the 
     Secretary may consider, in addition to financial, 
     macroeconomic, and monetary indicators--
       ``(A) whether an International Monetary Fund standby 
     agreement, Paris Club rescheduling plan, or other economic 
     restructuring plan is in place with respect to the country;
       ``(B) whether the country is addressing issues such as--
       ``(i) the convertibility of the currency of the country;
       ``(ii) adequate legal protection for foreign investments;
       ``(iii) the viability of the financial markets of the 
     country; and
       ``(iv) adequate legal protection for the private property 
     rights of citizens of the country; or
       ``(C) any other factors that are relevant to the ability of 
     the country to service the debt of the country.'';
       (3) by striking subsection (h) and inserting the following:
       ``(h) United States Agricultural Commodities.--The 
     Commodity Credit Corporation shall finance or guarantee under 
     this section only United States agricultural commodities.'';
       (4) in subsection (i)--
       (A) by striking paragraph (1);
       (B) by striking ``Institutions.--A financial'' and 
     inserting the following: ``Institutions.--
       ``(1) In general.--A financial'';
       (C) by striking ``(2) is'' and inserting the following:
       ``(A) is'';
       (D) by striking ``(3) is'' and inserting the following:
       ``(B) is''; and
       (E) by adding at the end the following:
       ``(2) Third country banks.--The Commodity Credit 
     Corporation may guarantee under subsections (a) and (b) the 
     repayment of credit made available to finance an export sale 
     irrespective of whether the obligor is located in the country 
     to which the export sale is destined.''; and
       (5) by striking subsection (k) and inserting the following:
       ``(k) Processed and High-Value Products.--
       ``(1) In general.--In issuing export credit guarantees 
     under this section, the Commodity Credit Corporation shall, 
     subject to paragraph (2), ensure that not less than 25 
     percent for each of fiscal years 1996 and 1997, 30 percent 
     for each of fiscal years 1998 and 1999, and 35 percent for 
     each of fiscal years 2000, 2001, and 2002, of the total 
     amount of credit guarantees issued for a fiscal year is 
     issued to promote the export of processed or high-value 
     agricultural products and that the balance is issued to 
     promote the export of bulk or raw agricultural commodities.
       ``(2) Limitation.--The percentage requirement of paragraph 
     (1) shall apply for a fiscal year to the extent that a 
     reduction in the total amount of credit guarantees issued for 
     the fiscal year is not required to meet the percentage 
     requirement.''.
       (b) Funding Levels.--Section 211 of the Agricultural Trade 
     Act of 1978 (7 U.S.C. 5641) is amended by striking subsection 
     (b) and inserting the following:
       ``(b) Export Credit Guarantee Programs.--
       ``(1) Export credit guarantees.--The Commodity Credit 
     Corporation shall make available for each of fiscal years 
     1996 through 2002 not less than $5,500,000,000 in credit 
     guarantees under subsections (a) and (b) of section 202.
       ``(2) Limitation on origination fee.--Notwithstanding any 
     other provision of law, the Secretary may not charge an 
     origination fee with respect to any credit guarantee 
     transaction under section 202(a) in excess of an amount equal 
     to 1 percent of the amount of credit to be guaranteed under 
     the transaction, except with respect to an export credit 
     guarantee transaction pursuant to section 1542(b) of the 
     Food, Agriculture, Conservation, and Trade Act of 1990 
     (Public Law 101-624; 7 U.S.C. 5622 note).''.
       (c) Definition of United States Agricultural Commodity.--
     Section 102(7) of the Agricultural Trade Act of 1978 (7 
     U.S.C. 5602(7)) is amended by striking subparagraphs (A) and 
     (B) and inserting the following:
       ``(A) an agricultural commodity or product entirely 
     produced in the United States; or
       ``(B) a product of an agricultural commodity--
       ``(i) 90 percent or more of the agricultural components of 
     which by weight, excluding packaging and added water, is 
     entirely produced in the United States; and

[[Page H2738]]

       ``(ii) that the Secretary determines to be a high value 
     agricultural product.''.
       (d) Regulations.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of Agriculture shall 
     issue regulations to carry out the amendments made by this 
     section.

     SEC. 244. MARKET ACCESS PROGRAM.

       (a) Change of Name.--
       (1) In general.--Section 203 of the Agricultural Trade Act 
     of 1978 (7 U.S.C. 5623) is amended--
       (A) in the section heading, by striking ``MARKET PROMOTION 
     PROGRAM'' and inserting ``MARKET ACCESS PROGRAM''; and
       (B) by striking ``marketing promotion program'' each place 
     it appears and inserting ``market access program''.
       (2) Conforming amendments.--
       (A) Section 1302 of the Omnibus Budget Reconciliation Act 
     of 1993 (Public Law 103-66; 7 U.S.C. 5623) is amended--
       (i) in the section heading, by striking ``MARKET PROMOTION 
     PROGRAM'' and inserting ``MARKET ACCESS PROGRAM''; and
       (ii) in subsection (b), by striking ``market promotion 
     program'' each place it appears and inserting ``market access 
     program''.
       (B) Section 211(c) of the Agricultural Trade Act of 1978 (7 
     U.S.C. 5641(c)) is amended--
       (i) in the subsection heading, by striking ``Marketing 
     Promotion Programs'' and inserting ``Market Access 
     Programs'';
       (ii) by striking ``market promotion activities'' and 
     inserting ``market access activities'';
       (iii) in paragraph (1), by striking ``market development 
     program'' and inserting ``market access program''; and
       (iv) in paragraph (2), by striking ``marketing promotion 
     program'' and inserting ``market access program''.
       (b) Use of Funds.--Section 203(f) of the Agricultural Trade 
     Act of 1978 (7 U.S.C. 5623(f)) is amended by adding at the 
     end the following:
       ``(4) Use of funds.--Funds made available to carry out this 
     section--
       ``(A) shall not be used to provide direct assistance to any 
     foreign for-profit corporation for the corporation's use in 
     promoting foreign-produced products;
       ``(B) shall not be used to provide direct assistance to any 
     for-profit corporation that is not recognized as a small-
     business concern described in section 3(a) of the Small 
     Business Act (15 U.S.C. 632(a)), excluding--
       ``(i) a cooperative;
       ``(ii) an association described in the first section of the 
     Act entitled `An Act To authorize association of producers of 
     agricultural products', approved February 18, 1922 (7 U.S.C. 
     291); and
       ``(iii) a nonprofit trade association; and
       ``(C) may be used by a United States trade association, 
     cooperative, or small business for individual branded 
     promotional activity related to a United States branded 
     product, if the beneficiaries of the activity have provided 
     funds for the activity in an amount that is at least 
     equivalent to the amount of assistance provided under this 
     section.''.
       (c) Funding.--Effective 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 $90,000,000 for each of fiscal years 
     1996 through 2002,''.

     SEC. 245. EXPORT ENHANCEMENT PROGRAM.

       (a) In General.--Effective October 1, 1995, section 301(e) 
     of the Agricultural Trade Act of 1978 (7 U.S.C. 5651(e)) is 
     amended by striking paragraph (1) and inserting the 
     following:
       ``(1) In general.--The Commodity Credit Corporation shall 
     make available to carry out the program established under 
     this section not more than--
       ``(A) $350,000,000 for fiscal year 1996;
       ``(B) $250,000,000 for fiscal year 1997;
       ``(C) $500,000,000 for fiscal year 1998;
       ``(D) $550,000,000 for fiscal year 1999;
       ``(E) $579,000,000 for fiscal year 2000;
       ``(F) $478,000,000 for fiscal year 2001; and
       ``(G) $478,000,000 for fiscal year 2002.''.
       (b) Priority Funding for Intermediate Products.--Section 
     301 of the Agricultural Trade Act of 1978 (7 U.S.C. 5651) is 
     amended by adding at the end the following:
       ``(h) Priority Funding for Intermediate Products.--
       ``(1) In general.--Effective beginning in fiscal year 1996, 
     and consistent, as determined by the Secretary, with the 
     obligations and reduction commitments undertaken by the 
     United States under the Uruguay Round Agreements, the 
     Secretary may make available not more than $100,000,000 for 
     each fiscal year under this section for the sale of 
     intermediate agricultural products in sufficient quantities 
     to attain the volume of export sales consistent with the 
     volume of intermediate agricultural products exported by the 
     United States during the Uruguay Round base period years of 
     1986 through 1990.
       ``(2) Additional assistance.--Notwithstanding paragraph 
     (1), if the export sale of any intermediate agricultural 
     product attains the volume of export sales consistent with 
     the volume of the intermediate agricultural product exported 
     by the United States during the Uruguay Round base period 
     years of 1986 through 1990, the Secretary may make available 
     additional amounts under this section for the encouragement 
     of export sales of the intermediate agricultural product.''.

     SEC. 246. ARRIVAL CERTIFICATION.

       Section 401 of the Agricultural Trade Act of 1978 (7 U.S.C. 
     5661) is amended by striking subsection (a) and inserting the 
     following:
       ``(a) Arrival Certification.--With respect to a commodity 
     provided, or for which financing or a credit guarantee or 
     other assistance is made available, under a program 
     authorized in section 201, 202, or 301, the Commodity Credit 
     Corporation shall require the exporter of the commodity to 
     maintain records of an official or customary commercial 
     nature or other documents as the Secretary may require, and 
     shall allow representatives of the Commodity Credit 
     Corporation access to the records or documents as needed, to 
     verify the arrival of the commodity in the country that is 
     the intended destination of the commodity.''.

     SEC. 247. COMPLIANCE.

       Section 402(a) of the Agricultural Trade Act of 1978 (7 
     U.S.C. 5662(a)) is amended--
       (1) by striking paragraph (2); and
       (2) by redesignating paragraph (3) as paragraph (2).

     SEC. 248. REGULATIONS.

       Section 404 of the Agricultural Trade Act of 1978 (7 U.S.C. 
     5664) is repealed.

     SEC. 249. TRADE COMPENSATION AND ASSISTANCE PROGRAMS.

       Subtitle B of title IV of the Agricultural Trade Act of 
     1978 (7 U.S.C. 5671 et seq.) is amended by adding at the end 
     the following:

     ``SEC. 417. TRADE COMPENSATION AND ASSISTANCE PROGRAMS.

       ``(a) In General.--Except as provided in subsection (f), 
     notwithstanding any other provision of law, if, after the 
     date of enactment of this section, the President or any other 
     member of the executive branch causes exports from the United 
     States to any country to be unilaterally suspended for 
     reasons of national security or foreign policy, and if within 
     90 days after the date on which the suspension is imposed on 
     United States exports no other country with an agricultural 
     economic interest agrees to participate in the suspension, 
     the Secretary shall carry out a trade compensation assistance 
     program in accordance with this section (referred to in this 
     section as a `program').
       ``(b) Compensation or Provision of Funds.--Under a program, 
     the Secretary shall, based on an evaluation by the Secretary 
     of the method most likely to produce the greatest 
     compensatory benefit for producers of the commodity involved 
     in the suspension--
       ``(1) compensate producers of the commodity by making 
     payments available to producers, as provided by subsection 
     (c)(1); or
       ``(2) make available an amount of funds calculated under 
     subsection (c)(2), to promote agricultural exports or provide 
     agricultural commodities to developing countries under any 
     authorities available to the Secretary.
       ``(c) Determination of Amount of Compensation or Funds.--
       ``(1) Compensation.--If the Secretary makes payments 
     available to producers under subsection (b)(1), the amount of 
     the payment shall be determined by the Secretary based on the 
     Secretary's estimate of the loss suffered by producers of the 
     commodity involved due to any decrease in the price of the 
     commodity as a result of the suspension.
       ``(2) Determination of amount of funds.--For each fiscal 
     year of a program, the amount of funds made available under 
     subsection (b)(2) shall be equal to 90 percent of the average 
     annual value of United States agricultural exports to the 
     country with respect to which exports are suspended during 
     the most recent 3 years prior to the suspension for which 
     data are available.
       ``(d) Duration of Program.--For each suspension of exports 
     for which a program is implemented under this section, funds 
     shall be made available under subsection (b) for each fiscal 
     year or part of a fiscal year for which the suspension is in 
     effect, but not to exceed 3 fiscal years.
       ``(e) Commodity Credit Corporation.--The Secretary shall 
     use funds of the Commodity Credit Corporation to carry out 
     this section.
       ``(f) Exception to Carrying Out a Program.--This section 
     shall not apply to any suspension of trade due to a war or 
     armed hostility.
       ``(g) Partial Year Embargoes.--If the Secretary makes funds 
     available under subsection (b)(2), regardless of whether an 
     embargo is in effect for only part of a fiscal year, the full 
     amount of funds as calculated under subsection (c)(2) shall 
     be made available under a program for the fiscal year. If the 
     Secretary determines that making the required amount of funds 
     available in a partial fiscal year is impracticable, the 
     Secretary may make all or part of the funds required to be 
     made available in the following fiscal year (in addition to 
     any funds otherwise required under a program to be made 
     available in the following fiscal year).
       ``(h) Short Supply Embargoes.--If the President or any 
     other member of the executive branch causes exports to be 
     suspended based on a determination of short supply, the 
     Secretary shall carry out section 1002 of the Food and 
     Agriculture Act of 1977 (7 U.S.C. 1310).''.

     SEC. 250. FOREIGN AGRICULTURAL SERVICE.

       Section 503 of the Agricultural Trade Act of 1978 (7 U.S.C. 
     5693) is amended to read as follows:

     ``SEC. 503. DUTIES OF FOREIGN AGRICULTURAL SERVICE.

       ``The Service shall assist the Secretary in carrying out 
     the agricultural trade policy and international cooperation 
     policy of the United States by--
       ``(1) acquiring information pertaining to agricultural 
     trade;
       ``(2) carrying out market promotion and development 
     activities;
       ``(3) providing agricultural technical assistance and 
     training; and
       ``(4) carrying out the programs authorized under this Act, 
     the Agricultural Trade Development and Assistance Act of 1954 
     (7 U.S.C. 1691 et seq.), and other Acts.''.

     SEC. 251. REPORTS.

       The first sentence of section 603 of the Agricultural Trade 
     Act of 1978 (7 U.S.C. 5713) is amended by striking ``The'' 
     and inserting ``Subject to section 217 of the Department of 
     Agriculture Reorganization Act of 1994 (7 U.S.C. 6917), 
     the''.

[[Page H2739]]

     SEC. 252. FOREIGN MARKET DEVELOPMENT COOPERATOR PROGRAM.

       The Agricultural Trade Act of 1978 (7 U.S.C. 5601 et seq.) 
     is amended by adding at the end the following:
       ``TITLE VII--FOREIGN MARKET DEVELOPMENT COOPERATOR PROGRAM

     ``SEC. 701. DEFINITION OF ELIGIBLE TRADE ORGANIZATION.

       ``In this title, the term `eligible trade organization' 
     means a United States trade organization that--
       ``(1) promotes the export of 1 or more United States 
     agricultural commodities or products; and
       ``(2) does not have a business interest in or receive 
     remuneration from specific sales of agricultural commodities 
     or products.

     ``SEC. 702. FOREIGN MARKET DEVELOPMENT COOPERATOR PROGRAM.

       ``(a) In General.--The Secretary shall establish and, in 
     cooperation with eligible trade organizations, carry out a 
     foreign market development cooperator program to maintain and 
     develop foreign markets for United States agricultural 
     commodities and products.
       ``(b) Administration.--Funds made available to carry out 
     this title shall be used only to provide--
       ``(1) cost-share assistance to an eligible trade 
     organization under a contract or agreement with the 
     organization; and
       ``(2) assistance for other costs that are necessary or 
     appropriate to carry out the foreign market development 
     cooperator program, including contingent liabilities that are 
     not otherwise funded.

     ``SEC. 703. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated to carry out this 
     title such sums as may be necessary for each of fiscal years 
     1996 through 2002.''.
        Subtitle C--Miscellaneous Agricultural Trade Provisions

     SEC. 261. EDWARD R. MADIGAN UNITED STATES AGRICULTURAL EXPORT 
                   EXCELLENCE AWARD.

       (a) Findings.--Congress finds that--
       (1) United States producers of agricultural products are 
     some of the most productive and efficient producers of 
     agricultural products in the world;
       (2) continued growth and expansion of markets for United 
     States agricultural exports is crucial to the continued 
     development and economic well-being of rural areas of the 
     United States and the agricultural sector of the United 
     States economy;
       (3) in recent years, United States agricultural exports 
     have steadily increased, surpassing $54,000,000,000 in value 
     in 1995;
       (4) as United States agricultural producers move toward a 
     market-oriented system in which planting and other decisions 
     by producers are driven by national and international market 
     signals, developing new and expanding agricultural export 
     markets is vital to maintaining a vibrant and healthy 
     agricultural sector and rural economy; and
       (5) a United States agricultural export excellence award 
     will increase United States agricultural exports by--
       (A) identifying efforts of United States entities to 
     develop and expand markets for United States agricultural 
     exports through the development of new products and services 
     and through the use of innovative marketing techniques;
       (B) recognizing achievements of those who have exhibited or 
     supported entrepreneurial efforts to expand and create new 
     markets for United States agricultural exports or increase 
     the volume or value of United States agricultural exports; 
     and
       (C) disseminating information on successful methods used to 
     develop and expand markets for United States agricultural 
     exports.
       (b) Establishment.--There is established the Edward R. 
     Madigan United States Agricultural Export Excellence Award, 
     which shall be evidenced by a medal bearing the inscription 
     ``Edward R. Madigan United States Agricultural Export 
     Excellence Award''. The medal shall be of such design and 
     materials and bear such additional inscriptions as the 
     Secretary of Agriculture (referred to in this section as the 
     ``Secretary'') may prescribe.
       (c) Selection of Recipient.--The President or the Secretary 
     (on the basis of recommendations received from the board 
     established under subsection (h)) shall periodically provide 
     the award to companies and other entities that in the 
     judgment of the President or the Secretary substantially 
     encourage entrepreneurial efforts in the food and agriculture 
     sector for advancing United States agricultural exports.
       (d) Presentation of Award.--The presentation of the award 
     shall be made by the President or the Secretary with such 
     ceremonies as the President or the Secretary considers 
     proper.
       (e) Publication of Award.--An entity to which an award is 
     made under this section may publicize the receipt of the 
     award by the entity and use the award in advertising of the 
     entity.
       (f) Categories for Which Award May Be Given.--Separate 
     awards shall be made to qualifying entities in each of the 
     following categories:
       (1) Development of new products or services for 
     agricultural export markets.
       (2) Development of new agricultural export markets.
       (3) Creative marketing of products or services in 
     agricultural export markets.
       (g) Criteria for Qualification.--An entity may qualify for 
     an award under this section only if the entity--
       (1)(A) applies to the board established under subsection 
     (h) in writing for the award; or
       (B) is recommended for the award by a Governor of a State;
       (2)(A) has exhibited significant entrepreneurial effort to 
     create new markets for United States agricultural exports or 
     increase United States agricultural exports; or
       (B) has provided significant assistance to others in an 
     effort to create new markets for United States agricultural 
     exports or increase United States agricultural exports;
       (3) has not received another award in the same category 
     under subsection (f) during the preceding 5-year period; and
       (4) meets such other requirements and specifications as the 
     Secretary determines are appropriate to achieve the 
     objectives of this section.
       (h) Board.--
       (1) Selection.--The Secretary shall appoint a board of 
     evaluators, consisting of at least 5 individuals from the 
     private sector selected for their knowledge and experience in 
     exporting United States agricultural products.
       (2) Meetings.--The board shall meet at least once annually 
     to review and evaluate all applicants and entities 
     recommended by States under subsection (g)(1).
       (3) Recommendations of board.--The board shall report its 
     recommendations concerning the making of the award to the 
     Secretary.
       (4) Term.--Each member of the board may serve a term of not 
     to exceed 3 years.
       (i) Funding.--The Secretary may seek and accept gifts from 
     public and private sources to carry out this section.

     SEC. 262. REPORTING REQUIREMENTS RELATING TO TOBACCO.

       Section 214 of the Tobacco Adjustment Act of 1983 (7 U.S.C. 
     509) is repealed.

     SEC. 263. TRIGGERED EXPORT ENHANCEMENT.

       (a) Readjustment of Support Levels.--Section 1302 of the 
     Omnibus Budget Reconciliation Act of 1990 (Public Law 101-
     508; 7 U.S.C. 1421 note) is repealed.
       (b) Triggered Marketing Loans and Export Enhancement.--
     Section 4301 of the Omnibus Trade and Competitiveness Act of 
     1988 (Public Law 100-418; 7 U.S.C. 1446 note) is repealed.
       (c) Effective Date.--The amendments made by this section 
     shall be effective beginning with the 1996 crops of wheat, 
     feed grains, upland cotton, and rice.

     SEC. 264. DISPOSITION OF COMMODITIES TO PREVENT WASTE.

       Section 416 of the Agricultural Act of 1949 (7 U.S.C. 1431) 
     is amended--
       (1) in subsection (b)--
       (A) in paragraph (7)--
       (i) in subparagraph (D)(iv), by striking ``one year of 
     acquisition'' and all that follows through the period at the 
     end and inserting the following: ``a reasonable length of 
     time, as determined by the Secretary, except that the 
     Secretary may permit the use of proceeds in a country other 
     than the country of origin--
       ``(I) as necessary to expedite the transportation of 
     commodities and products furnished under this subsection; or
       ``(II) if the proceeds are generated in a currency 
     generally accepted in the other country.''; and
       (ii) by striking the sentence following subparagraph (F) 
     and inserting the following: ``The Secretary may approve the 
     use of proceeds or services realized from the sale or barter 
     of a commodity furnished under this subsection by a nonprofit 
     voluntary agency, cooperative, or intergovernmental agency or 
     organization to meet administrative expenses incurred in 
     connection with activities undertaken under this 
     subsection.'';
       (B) in paragraph (8), by striking subparagraph (C); and
       (C) by striking paragraphs (10), (11), and (12); and
       (2) by striking subsection (c).

     SEC. 265. DEBT-FOR-HEALTH-AND-PROTECTION SWAP.

       (a) In General.--Section 1517 of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 1706) is 
     repealed.
       (b) Technical Amendment.--Subsection (e)(3) of the Food for 
     Progress Act of 1985 (7 U.S.C. 1736o(e)(3)) is amended by 
     striking ``section 106'' and inserting ``section 103''.

     SEC. 266. POLICY ON EXPANSION OF INTERNATIONAL MARKETS.

       Section 1207 of the Agriculture and Food Act of 1981 (7 
     U.S.C. 1736m) is repealed.

     SEC. 267. POLICY ON MAINTENANCE AND DEVELOPMENT OF EXPORT 
                   MARKETS.

       Section 1121 of the Food Security Act of 1985 (7 U.S.C. 
     1736p) is amended--
       (1) by striking subsection (a); and
       (2) in subsection (b)--
       (A) by striking ``(b)''; and
       (B) by striking paragraphs (1) through (4) and inserting 
     the following:
       ``(1) be the premier supplier of agricultural and food 
     products to world markets and expand exports of high value 
     products;
       ``(2) support the principle of free trade and the promotion 
     of fair trade in agricultural commodities and products;
       ``(3) cooperate fully in all efforts to negotiate with 
     foreign countries further reductions in tariff and nontariff 
     barriers to trade, including sanitary and phytosanitary 
     measures and trade-distorting subsidies;
       ``(4) aggressively counter unfair foreign trade practices 
     as a means of encouraging fairer trade;''.

     SEC. 268. POLICY ON TRADE LIBERALIZATION.

       Section 1122 of the Food Security Act of 1985 (7 U.S.C. 
     1736q) is repealed.

     SEC. 269. AGRICULTURAL TRADE NEGOTIATIONS.

       Section 1123 of the Food Security Act of 1985 (7 U.S.C. 
     1736r) is amended to read as follows:

     ``SEC. 1123. TRADE NEGOTIATIONS POLICY.

       ``(a) Findings.--Congress finds that--
       ``(1) on a level playing field, United States producers are 
     the most competitive suppliers of agricultural products in 
     the world;
       ``(2) exports of United States agricultural products 
     accounted for $54,000,000,000 in 1995,

[[Page H2740]]

     contributing a net $24,000,000,000 to the merchandise trade 
     balance of the United States and supporting approximately 
     1,000,000 jobs;
       ``(3) increased agricultural exports are critical to the 
     future of the farm, rural, and overall United States economy, 
     but the opportunities for increased agricultural exports are 
     limited by the unfair subsidies of the competitors of the 
     United States, and a variety of tariff and nontariff barriers 
     to highly competitive United States agricultural products;
       ``(4) international negotiations can play a key role in 
     breaking down barriers to United States agricultural exports;
       ``(5) the Uruguay Round Agreement on Agriculture made 
     significant progress in the attainment of increased market 
     access opportunities for United States exports of 
     agricultural products, for the first time--
       ``(A) restraining foreign trade-distorting domestic support 
     and export subsidy programs; and
       ``(B) developing common rules for the application of 
     sanitary and phytosanitary restrictions;
     that should result in increased exports of United States 
     agricultural products, jobs, and income growth in the United 
     States;
       ``(6) the Uruguay Round Agreement on Agriculture did not 
     succeed in completely eliminating trade distorting domestic 
     support and export subsidies by--
       ``(A) allowing the European Union to continue unreasonable 
     levels of spending on export subsidies; and
       ``(B) failing to discipline monopolistic state trading 
     entities, such as the Canadian Wheat Board, that use 
     nontransparent and discriminatory pricing as a hidden de 
     facto export subsidy;
       ``(7) during the period 1996 through 2002, there will be 
     several opportunities for the United States to negotiate 
     fairer trade in agricultural products, including further 
     negotiations under the World Trade Organization, and steps 
     toward possible free trade agreements of the Americas and 
     Asian-Pacific Economic Cooperation (APEC); and
       ``(8) the United States should aggressively use these 
     opportunities to achieve more open and fair opportunities for 
     trade in agricultural products.
       ``(b) Goals of the United States in Agricultural Trade 
     Negotiations.--The objectives of the United States with 
     respect to future negotiations on agricultural trade 
     include--
       ``(1) increasing opportunities for United States exports of 
     agricultural products by eliminating tariff and nontariff 
     barriers to trade;
       ``(2) leveling the playing field for United States 
     producers of agricultural products by limiting per unit 
     domestic production supports to levels that are no greater 
     than those available in the United States;
       ``(3) ending the practice of export dumping by eliminating 
     all trade distorting export subsidies and disciplining state 
     trading entities so that they do not (except in cases of bona 
     fide food aid) sell in foreign markets at prices below 
     domestic market prices or prices below their full costs of 
     acquiring and delivering agricultural products to the foreign 
     markets; and
       ``(4) encouraging government policies that avoid price-
     depressing surpluses.''.

     SEC. 270. POLICY ON UNFAIR TRADE PRACTICES.

       Section 1164 of the Food Security Act of 1985 (Public Law 
     99-198; 99 Stat. 1499) is repealed.

     SEC. 271. AGRICULTURAL AID AND TRADE MISSIONS.

       (a) In General.--The Agricultural Aid and Trade Missions 
     Act (7 U.S.C. 1736bb et seq.) is repealed.
       (b) Conforming Amendment.--Section 7 of Public Law 100-277 
     (7 U.S.C. 1736bb note) is repealed.

     SEC. 272. ANNUAL REPORTS BY AGRICULTURAL ATTACHES.

       Section 108(b)(1)(B) of the Agricultural Act of 1954 (7 
     U.S.C. 1748(b)(1)(B)) is amended by striking ``including 
     fruits, vegetables, legumes, popcorn and ducks''.

     SEC. 273. WORLD LIVESTOCK MARKET PRICE INFORMATION.

       Section 1545 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (Public Law 101-624; 7 U.S.C. 1761 note) is 
     repealed.

     SEC. 274. ORDERLY LIQUIDATION OF STOCKS.

       Sections 201 and 207 of the Agricultural Act of 1956 (7 
     U.S.C. 1851 and 1857) are repealed.

     SEC. 275. SALES OF EXTRA LONG STAPLE COTTON.

       Section 202 of the Agricultural Act of 1956 (7 U.S.C. 1852) 
     is repealed.

     SEC. 276. REGULATIONS.

       Section 707 of the Freedom for Russia and Emerging Eurasian 
     Democracies and Open Markets Support Act of 1992 (Public Law 
     102-511; 7 U.S.C. 5621 note) is amended by striking 
     subsection (d).

     SEC. 277. EMERGING MARKETS.

       (a) Promotion of Agricultural Exports to Emerging 
     Markets.--
       (1) Emerging markets.--Section 1542 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (Public Law 
     101-624; 7 U.S.C. 5622 note) is amended--
       (A) in the section heading, by striking ``EMERGING 
     DEMOCRACIES'' and inserting ``EMERGING MARKETS'';
       (B) by striking ``emerging democracies'' each place it 
     appears in subsections (b), (d), and (e) and inserting 
     ``emerging markets'';
       (C) in subsection (c), by striking ``emerging democracy'' 
     each place it appears and inserting ``emerging market''; and
       (D) by striking subsection (f) and inserting the following:
       ``(f) Emerging Market.--In this section and section 1543, 
     the term `emerging market' means any country that the 
     Secretary determines--
       ``(1) is taking steps toward a market-oriented economy 
     through the food, agriculture, or rural business sectors of 
     the economy of the country; and
       ``(2) has the potential to provide a viable and significant 
     market for United States agricultural commodities or products 
     of United States agricultural commodities.''.
       (2) Funding.--Section 1542 of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 is amended by striking 
     subsection (a) and inserting the following:
       ``(a) Funding.--The Commodity Credit Corporation shall make 
     available for fiscal years 1996 through 2002 not less than 
     $1,000,000,000 of direct credits or export credit guarantees 
     for exports to emerging markets under section 201 or 202 of 
     the Agricultural Trade Act of 1978 (7 U.S.C. 5621 and 5622), 
     in addition to the amounts acquired or authorized under 
     section 211 of the Act (7 U.S.C. 5641) for the program.''.
       (3) Agricultural fellowship program.--Section 1542 of the 
     Food, Agriculture, Conservation, and Trade Act of 1990 is 
     amended--
       (A) in subsection (b), by striking the last sentence and 
     inserting the following: ``The Commodity Credit Corporation 
     shall give priority under this subsection to--
       ``(A) projects that encourage the privatization of the 
     agricultural sector or that benefit private farms or 
     cooperatives in emerging markets; and
       ``(B) projects for which nongovernmental persons agree to 
     assume a relatively larger share of the costs.''; and
       (B) in subsection (d)--
       (i) in the matter preceding paragraph (1), by striking 
     ``the Soviet Union'' and inserting ``emerging markets'';
       (ii) in paragraph (1)--

       (I) in subparagraph (A)(i)--

       (aa) by striking ``1995'' and inserting ``2002''; and
       (bb) by striking ``those systems, and identify'' and 
     inserting ``the systems, including potential reductions in 
     trade barriers, and identify and carry out'';

       (II) in subparagraph (B), by striking ``shall'' and 
     inserting ``may'';
       (III) in subparagraph (D), by inserting ``(including the 
     establishment of extension services)'' after ``technical 
     assistance'';
       (IV) by striking subparagraph (F); and
       (V) by redesignating subparagraphs (G), (H), and (I) as 
     subparagraphs (F), (G), and (H), respectively;

       (iii) in paragraph (2)--

       (I) by striking ``the Soviet Union'' each place it appears 
     and inserting ``emerging markets'';
       (II) in subparagraph (A), by striking ``a free market food 
     production and distribution system'' and inserting ``free 
     market food production and distribution systems'';
       (III) in subparagraph (B)--

       (aa) in clause (i), by striking ``Government'' and 
     inserting ``governments'';
       (bb) in clause (iii)(II), by striking ``and'' at the end;
       (cc) in clause (iii)(III), by striking the period at the 
     end and inserting ``; and''; and
       (dd) by adding at the end of clause (iii) the following:

       ``(IV) to provide for the exchange of administrators and 
     faculty members from agricultural and other institutions to 
     strengthen and revise educational programs in agricultural 
     economics, agribusiness, and agrarian law, to support change 
     towards a free market economy in emerging markets.'';
       (IV) by striking subparagraph (D); and
       (V) by redesignating subparagraph (E) as subparagraph (D); 
     and

       (iv) by striking paragraph (3).
       (4) United states agricultural commodity.--Subsections (b) 
     and (c) of section 1542 of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 are amended by striking 
     ``section 101(6)'' each place it appears and inserting 
     ``section 102(7)''.
       (5) Report.--The first sentence of section 1542(e)(2) of 
     the Food, Agriculture, Conservation, and Trade Act of 1990 is 
     amended by striking ``Not'' and inserting ``Subject to 
     section 217 of the Department of Agriculture Reorganization 
     Act of 1994 (7 U.S.C. 6917), not''.
       (b) Agricultural Fellowship Program for Middle Income 
     Countries, Emerging Democracies, and Emerging Markets.--
     Section 1543 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 3293) is amended--
       (1) in the section heading, by striking ``MIDDLE INCOME 
     COUNTRIES AND EMERGING DEMOCRACIES'' and inserting ``MIDDLE 
     INCOME COUNTRIES, EMERGING DEMOCRACIES, AND EMERGING 
     MARKETS'';
       (2) in subsection (b), by adding at the end the following:
       ``(5) Emerging market.--Any emerging market, as defined in 
     section 1542(f).''; and
       (3) in subsection (c)(1), by striking ``food needs'' and 
     inserting ``food and fiber needs''.
       (c) Conforming Amendments.--
       (1) Section 501 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1737) is amended--
       (A) in subsection (a), by striking ``emerging democracies'' 
     and inserting ``emerging markets''; and
       (B) in subsection (b), by striking paragraph (1) and 
     inserting the following:
       ``(1) Emerging market.--The term `emerging market' means 
     any country that the Secretary determines--
       ``(A) is taking steps toward a market-oriented economy 
     through the food, agriculture, or rural business sectors of 
     the economy of the country; and
       ``(B) has the potential to provide a viable and significant 
     market for United States agricultural commodities or products 
     of United States agricultural commodities.''.
       (2) Section 201(d)(1)(C)(ii) of the Agricultural Trade Act 
     of 1978 (7 U.S.C. 5621(d)(1)(C)(ii)) is amended by striking 
     ``emerging democracies'' and inserting ``emerging markets''.

[[Page H2741]]

       (3) Section 202(d)(3)(B) of the Agricultural Trade Act of 
     1978 (7 U.S.C. 5622(d)(3)(B)) is amended by striking 
     ``emerging democracies'' and inserting ``emerging markets''.

     SEC. 278. REIMBURSEMENT FOR OVERHEAD EXPENSES.

       Section 1542(d)(1)(D) of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (Public Law 101-624; 7 
     U.S.C. 5622 note) is amended by adding at the end the 
     following: ``Notwithstanding any other provision of law, the 
     assistance shall include assistance for administrative and 
     overhead expenses of the International Cooperation and 
     Development Program Area of the Foreign Agriculture Service, 
     to the extent that the expenses were incurred pursuant to 
     reimbursable agreements entered into prior to September 30, 
     1993, the expenses do not exceed $2,000,000 per year, and the 
     expenses are not incurred for information technology 
     systems.''.

     SEC. 279. LABELING OF DOMESTIC AND IMPORTED LAMB AND MUTTON.

       Section 7 of the Federal Meat Inspection Act (21 U.S.C. 
     607) is amended by adding at the end the following:
       ``(f) Lamb and Mutton.--The Secretary, consistent with 
     United States international obligations, shall establish 
     standards for the labeling of sheep carcasses, parts of sheep 
     carcasses, sheepmeat, and sheepmeat food products.''.

     SEC. 280. IMPORT ASSISTANCE FOR CBI BENEFICIARY COUNTRIES AND 
                   THE PHILIPPINES.

       Section 583 of Public Law 100-202 (101 Stat. 1329-182) is 
     repealed.

     SEC. 281. STUDIES, REPORTS, AND OTHER PROVISIONS.

       (a) In General.--Sections 1551 through 1555, section 1558, 
     and section 1559 of subtitle E of title XV of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (Public Law 
     101-624; 104 Stat. 3696) (as redesignated by section 1011(d) 
     of the Federal Reports Elimination and Sunset Act of 1995 
     (Public Law 104-66; 109 Stat. 709)) are repealed.
       (b) Language Proficiency.--Section 1556 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (Public Law 
     101-624; 7 U.S.C. 5694 note) is amended by striking 
     subsection (c).

     SEC. 282. SENSE OF CONGRESS CONCERNING MULTILATERAL 
                   DISCIPLINES ON CREDIT GUARANTEES.

       It is the sense of Congress that--
       (1) in negotiations to establish multilateral disciplines 
     on agricultural export credits and credit guarantees, the 
     United States should not agree to any arrangement that is 
     incompatible with the provisions of United States law that 
     authorize agricultural export credits and credit guarantees;
       (2) in the negotiations (which are held under the auspices 
     of the Organization for Economic Cooperation and 
     Development), the United States should not reach any 
     agreement that fails to impose disciplines on the practices 
     of foreign government trading entities such as the Australian 
     Wheat Board, the Canadian Wheat Board, the New Zealand Dairy 
     Board, and the Australian Dairy Board; and
       (3) the disciplines should include greater openness in the 
     operations of the entities as long as the entities are 
     subsidized by the foreign government or have monopolies for 
     exports of a commodity that are sanctioned by the foreign 
     government.

     SEC. 283. INTERNATIONAL COTTON ADVISORY COMMITTEE.

       (a) In General.--The President shall ensure that the 
     Government of the United States participates as a full member 
     of the International Cotton Advisory Committee.
       (b) Representation by the Secretary.--The Secretary of 
     Agriculture shall represent the Government of the United 
     States as a member of the International Cotton Advisory 
     Committee and shall delegate the primary responsibility to 
     represent the Government of the United States to 
     appropriately qualified individuals.
                        TITLE III--CONSERVATION
                        Subtitle A--Definitions

     SEC. 301. DEFINITIONS APPLICABLE TO HIGHLY ERODIBLE CROPLAND 
                   CONSERVATION.

       (a) Conservation Plan and Conservation System.--Section 
     1201(a) of the Food Security Act of 1985 (16 U.S.C. 3801(a)) 
     is amended--
       (1) by redesignating paragraphs (2) through (16) as 
     paragraphs (4) through (18), respectively; and
       (2) by inserting after paragraph (1) the following:
       ``(2) Conservation plan.--The term `conservation plan' 
     means the document that--
       ``(A) applies to highly erodible cropland;
       ``(B) describes the conservation system applicable to the 
     highly erodible cropland and describes the decisions of the 
     person with respect to location, land use, tillage systems, 
     and conservation treatment measures and schedule; and
       ``(C) is approved by the local soil conservation district, 
     in consultation with the local committees established under 
     section 8(b)(5) of the Soil Conservation and Domestic 
     Allotment Act (16 U.S.C. 590h(b)(5)) and the Secretary, or by 
     the Secretary.
       ``(3) Conservation system.--The term `conservation system' 
     means a combination of 1 or more conservation measures or 
     management practices that--
       ``(A) are based on local resource conditions, available 
     conservation technology, and the standards and guidelines 
     contained in the Natural Resources Conservation Service field 
     office technical guides; and
       ``(B) are designed to achieve, in a cost effective and 
     technically practicable manner, a substantial reduction in 
     soil erosion or a substantial improvement in soil conditions 
     on a field or group of fields containing highly erodible 
     cropland when compared to the level of erosion or soil 
     conditions that existed before the application of the 
     conservation measures and management practices.''.
       (b) Field.--Section 1201(a) of the Food Security Act of 
     1985 is amended by striking paragraph (7) (as redesignated by 
     subsection (a)(1)) and inserting the following:
       ``(7) Field.--The term `field' means a part of a farm that 
     is separated from the balance of the farm by permanent 
     boundaries such as fences, roads, permanent waterways, or 
     other similar features. At the option of the owner or 
     operator of the farm, croplines may also be used to delineate 
     a field if farming practices make it probable that the 
     croplines are not subject to change. Any highly erodible land 
     on which an agricultural commodity is produced after December 
     23, 1985, and that is not exempt under section 1212, shall be 
     considered as part of the field in which the land was 
     included on December 23, 1985, unless the owner and Secretary 
     agree to modification of the boundaries of the field to carry 
     out this title.''.
       (c) Highly Erodible Land.--Section 1201(a)(9) of the Food 
     Security Act of 1985 (as redesignated by subsection (a)(1)) 
     is amended by adding at the end the following:
       ``(C) Equations.--Not later than 60 days after the date of 
     enactment of this subparagraph, the Secretary shall publish 
     in the Federal Register the universal soil loss equation and 
     wind erosion equation used by the Department of Agriculture 
     as of that date. The Secretary may not change the equations 
     after that date except following notice and comment in a 
     manner consistent with section 553 of title 5, United States 
     Code.''.
       (d) Conforming Amendments.--Section 1212 of the Food 
     Security Act of 1985 (16 U.S.C. 3812) is amended--
       (1) in the first sentence of subsection (a)(2), by striking 
     ``that documents'' and all that follows through ``by the 
     Secretary'';
       (2) in subsection (c)(3), by striking ``based on'' and all 
     that follows through ``and the Secretary,'' and inserting ``, 
     in which case,'';
       (3) in subsection (e)(1)(A), by striking ``conservation 
     compliance plan'' and inserting ``conservation plan''; and
       (4) in subsection (f)--
       (A) in paragraph (1), by striking ``that documents'' and 
     all that follows through ``under subsection (a)'';
       (B) in paragraph (3), by striking ``prepared under 
     subsection (a)''; and
       (C) in paragraph (4), by striking ``that documents'' and 
     all that follows through ``subsection (a)''.
             Subtitle B--Highly Erodible Land Conservation

     SEC. 311. PROGRAM INELIGIBILITY.

       Effective 90 days after the date of enactment of this Act, 
     section 1211 of the Food Security Act of 1985 (16 U.S.C. 
     3811) is amended--
       (1) in the matter preceding paragraph (1), by striking 
     ``following the date of enactment of this Act,'';
       (2) in paragraph (1)--
       (A) by striking subparagraph (A) and inserting the 
     following:
       ``(A) contract payments under a production flexibility 
     contract, marketing assistance loans, and any type of price 
     support or payment made available under the Agricultural 
     Market Transition Act, the Commodity Credit Corporation 
     Charter Act (15 U.S.C. 714 et seq.), or any other Act;'';
       (B) by striking subparagraph (C);
       (C) in subparagraph (D), by striking ``made under'' and all 
     that follows through ``August 14, 1989'';
       (D) in subparagraph (E), by striking ``Farmers Home 
     Administration'' and inserting ``Consolidated Farm Service 
     Agency''; and
       (E) by redesignating subparagraphs (D) and (E) as 
     subparagraphs (C) and (D), respectively; and
       (3) by striking paragraph (3) and inserting the following:
       ``(3) during the crop year--
       ``(A) a payment made pursuant to a contract entered into 
     under the environmental quality incentives program under 
     chapter 4 of subtitle D;
       ``(B) a payment under any other provision of subtitle D;
       ``(C) a payment under section 401 or 402 of the 
     Agricultural Credit Act of 1978 (16 U.S.C. 2201 and 2202); or
       ``(D) a payment, loan, or other assistance under section 3 
     or 8 of the Watershed Protection and Flood Prevention Act (16 
     U.S.C. 1003 and 1006a).''.

     SEC. 312. CONSERVATION RESERVE LANDS.

       Section 1212(a)(3) of the Food Security Act of 1985 (16 
     U.S.C. 3812(a)(3)) is amended by striking ``shall, if the 
     conservation plan established under this subtitle for such 
     land requires structures to be constructed,'' and inserting 
     ``shall only be required to apply a conservation plan 
     established under this subtitle. The person shall not be 
     required to meet a higher conservation standard than the 
     standard applied to other highly erodible cropland located 
     within the same area. If the person's conservation plan 
     requires structures to be constructed, the person shall''.

     SEC. 313. GOOD FAITH EXEMPTION.

       (a) Grace Period To Resume Conservation Compliance.--
     Section 1212(f)(1) of the Food Security Act of 1985 (16 
     U.S.C. 3812(f)(1)) is amended--
       (1) by striking ``Except to the extent provided in 
     paragraph (2), no'' and inserting ``No''; and
       (2) by striking ``such person has--'' and all that follows 
     through the period at the end of subparagraph (B) and 
     inserting the following: ``the person has acted in good faith 
     and without an intent to violate this subtitle. A person who 
     meets the requirements of this paragraph shall be allowed a 
     reasonable period of time, as determined by the Secretary, 
     but not to exceed 1 year, during which to implement the 
     measures

[[Page H2742]]

     and practices necessary to be considered to be actively 
     applying the person's conservation plan.''.
       (b) Special Penalties Regarding Certain Highly Erodible 
     Cropland.--Section 1212(f)(2) of the Food Security Act of 
     1985 (16 U.S.C. 3812(f)(2)) is amended by striking ``meets 
     the requirements of paragraph (1)'' and inserting ``with 
     respect to highly erodible cropland that was not in 
     production prior to December 23, 1985, and has acted in good 
     faith and without an intent to violate the provisions''.
       (c) Conforming Amendment.--Section 1212(f)(4) of the Food 
     Security Act of 1985 (16 U.S.C. 3812(f)(4)) is amended by 
     striking the last sentence.

     SEC. 314. EXPEDITED PROCEDURES FOR GRANTING VARIANCES FROM 
                   CONSERVATION PLANS.

       Section 1212(f) of the Food Security Act of 1985 (16 U.S.C. 
     3812(f)(4)) is amended--
       (1) in paragraph (4)(C), by striking ``problem'' and 
     inserting ``problem, including weather, pest, and disease 
     problems''; and
       (2) by adding at the end the following:
       ``(5) Expedited procedures for temporary variances.--After 
     consultation with local conservation districts, the Secretary 
     shall establish expedited procedures for the consideration 
     and granting of temporary variances under paragraph (4)(C). 
     If the request for a temporary variance under paragraph 
     (4)(C) involves the use of practices or measures to address 
     weather, pest, or disease problems, the Secretary shall make 
     a decision on whether to grant the variance during the 30-day 
     period beginning on the date of receipt of the request. If 
     the Secretary fails to render a decision during the period, 
     the temporary variance shall be considered granted.''.

     SEC. 315. DEVELOPMENT AND IMPLEMENTATION OF CONSERVATION 
                   PLANS AND CONSERVATION SYSTEMS.

       (a) Development and Implementation.--The Food Security Act 
     of 1985 is amended--
       (1) by redesignating section 1213 (16 U.S.C. 3813) as 
     section 1214; and
       (2) by inserting after section 1212 (16 U.S.C. 3812) the 
     following:

     ``SEC. 1213. DEVELOPMENT AND IMPLEMENTATION OF CONSERVATION 
                   PLANS AND CONSERVATION SYSTEMS.

       ``(a) Technical Requirements.--In connection with the 
     standards and guidelines contained in Natural Resources 
     Conservation Service field office technical guides applicable 
     to the development and use of conservation measures and 
     management practices as part of a conservation system, the 
     Secretary shall ensure that the standards and guidelines 
     permit a person to use a conservation system that--
       ``(1) is technically and economically feasible;
       ``(2) is based on local resource conditions and available 
     conservation technology;
       ``(3) is cost-effective; and
       ``(4) does not cause undue economic hardship on the person 
     applying the conservation system under the person's 
     conservation plan.
       ``(b) Measurement of Erosion Reduction.--For the purpose of 
     determining whether there is a substantial reduction in soil 
     erosion on a field containing highly erodible cropland, the 
     measurement of erosion reduction achieved by the application 
     of a conservation system under a person's conservation plan 
     shall be based on the estimated annual level of erosion at 
     the time of the measurement compared to the estimated annual 
     level of erosion that existed before the implementation of 
     the conservation measures and management practices provided 
     for in the conservation system.
       ``(c) Residue Measurement.--
       ``(1) Responsibilities of the secretary.--For the purpose 
     of measuring the level of residue on a field, the Secretary 
     shall--
       ``(A) take into account any residue incorporated into the 
     top 2 inches of soil, as well as the growing crop, in the 
     measurement;
       ``(B) provide technical guidelines for acceptable residue 
     measurement methods;
       ``(C) provide a certification system for third parties to 
     perform residue measurements; and
       ``(D) provide for the acceptance and use of information and 
     data voluntarily provided by the producer regarding the 
     field.
       ``(2) Acceptance of producer measurements.--Annual residue 
     measurements supplied by a producer (including measurements 
     performed by a certified third party) shall be used by the 
     Secretary if the Secretary determines that the measurements 
     indicate that the residue level for the field meets the level 
     required under the conservation plan.
       ``(d) Certification of Compliance.--
       ``(1) In general.--For the purpose of determining the 
     eligibility of a person for program benefits specified in 
     section 1211 at the time application is made for the 
     benefits, the Secretary shall permit the person to certify 
     that the person is complying with the person's conservation 
     plan.
       ``(2) Status reviews.--If a person makes a certification 
     under paragraph (1), the Secretary shall not be required to 
     carry out a review of the status of compliance of the person 
     with the conservation plan under which the conservation 
     system is being applied.
       ``(3) Revisions and modifications.--The Secretary shall 
     permit a person who makes a certification under paragraph (1) 
     with respect to a conservation plan to revise the 
     conservation plan in any manner, if the same level of 
     conservation treatment provided for by the conservation 
     system under the person's conservation plan is maintained. 
     The Secretary may not revise the person's conservation plan 
     without the concurrence of the person.
       ``(e) Technical Assistance.--The Secretary shall, using 
     available resources and consistent with the Secretary's other 
     conservation responsibilities and objectives, provide 
     technical assistance to a person throughout the development, 
     revision, and application of the conservation plan and any 
     conservation system of the person. At the request of the 
     person, the Secretary may provide technical assistance 
     regarding conservation measures and management practices for 
     other lands of the person that do not contain highly erodible 
     cropland.
       ``(f) Encouragement of On-Farm Research.--To encourage on-
     farm conservation research, the Secretary may allow a person 
     to include in the person's conservation plan or a 
     conservation system under the plan, on a field trial basis, 
     practices that are not currently approved but that the 
     Secretary considers have a reasonable likelihood of 
     success.''.
       (b) Treatment of Technical Determinations.--Section 
     226(d)(2) of the Department of Agriculture Reorganization Act 
     of 1994 (7 U.S.C. 6932(d)(2)) is amended--
       (1) by striking ``determination.--With'' and inserting 
     ``determination.--
       ``(A) In general.--With''; and
       (2) by adding at the end the following:
       ``(B) Economic hardship.--After a technical determination 
     has been made, on a producer's request, if a county or area 
     committee determines that the application of the producer's 
     conservation system would impose an undue economic hardship 
     on the producer, the committee shall provide the producer 
     with relief to avoid the hardship.''.

     SEC. 316. INVESTIGATION OF POSSIBLE COMPLIANCE DEFICIENCIES.

       Subtitle B of title XII of the Food Security Act of 1985 
     (as amended by section 315(a)(1)) is amended by adding at the 
     end the following:

     ``SEC. 1215. NOTICE AND INVESTIGATION OF POSSIBLE COMPLIANCE 
                   DEFICIENCIES.

       ``(a) In General.--An employee of the Department of 
     Agriculture who observes a possible compliance deficiency or 
     other potential violation of a conservation plan or this 
     subtitle while providing on-site technical assistance shall 
     provide to the responsible persons, not later than 45 days 
     after observing the possible violation, information regarding 
     actions needed to comply with the plan and this subtitle. The 
     employee shall provide the information in lieu of reporting 
     the observation as a compliance violation.
       ``(b) Corrective Action.--The responsible persons shall 
     attempt to correct the deficiencies as soon as practicable 
     after receiving the information.
       ``(c) Review.--If the corrective action is not fully 
     implemented not later than 1 year after the responsible 
     persons receive the information, the Secretary may conduct a 
     review of the status of compliance of the persons with the 
     conservation plan and this subtitle.''.

     SEC. 317. WIND EROSION ESTIMATION PILOT PROJECT.

       (a) In General.--The Secretary of Agriculture shall conduct 
     a pilot project to review, and modify as appropriate, the use 
     of wind erosion factors under the highly erodible 
     conservation requirements of subtitle B of title XII of the 
     Food Security Act of 1985 (16 U.S.C. 3811 et seq.)
       (b) Selection of Counties and Producers.--The pilot project 
     shall be conducted for producers in those counties that--
       (1) have approximately 100 percent of their cropland 
     determined to be highly erodible under title XII of the Act;
       (2) have a reasonable likelihood that the use of wind 
     erosion factors under title XII of the Act have resulted in 
     an inequitable application of the highly erodible land 
     requirements of title XII of the Act; and
       (3) if the use of the land classification system under 
     section 1201(a)(9)(A) of the Act (as redesignated by section 
     301(a)(1)) may result in a more accurate delineation of the 
     cropland.
       (c) Errors in Delineation.--If the Secretary determines 
     that a significant error has occurred in delineating cropland 
     under the pilot project, the Secretary shall, at the request 
     of the owners or operators of the cropland, conduct a new 
     delineation of the cropland using the most accurate available 
     delineation process, as determined by the Secretary.
                    Subtitle C--Wetland Conservation

     SEC. 321. PROGRAM INELIGIBILITY.

       (a) Program Ineligibility.--Section 1221 of the Food 
     Security Act of 1985 (16 U.S.C. 3821) is amended--
       (1) by redesignating subsection (b) as subsection (c); and
       (2) by striking the section heading and all that follows 
     through the end of subsection (a) and inserting the 
     following:

     ``SEC. 1221. PROGRAM INELIGIBILITY.

       ``(a) Production on Converted Wetland.--Except as provided 
     in this subtitle and notwithstanding any other provision of 
     law, any person who in any crop year produces an agricultural 
     commodity on converted wetland, as determined by the 
     Secretary, shall be--
       ``(1) in violation of this section; and
       ``(2) ineligible for loans or payments in an amount 
     determined by the Secretary to be proportionate to the 
     severity of the violation.
       ``(b) Ineligibility for Certain Loans and Payments.--If a 
     person is determined to have committed a violation under 
     subsection (a) during a crop year, the Secretary shall 
     determine which of, and the amount of, the following loans 
     and payments for which the person shall be ineligible:
       ``(1) Contract payments under a production flexibility 
     contract, marketing assistance loans, and any type of price 
     support or payment made available under the Agricultural 
     Market Transition Act, the Commodity Credit Corporation 
     Charter Act (15 U.S.C. 714 et seq.), or any other Act.
       ``(2) A loan made or guaranteed under the Consolidated Farm 
     and Rural Development Act (7 U.S.C. 1921 et seq.) or any 
     other provision of law administered by the Consolidated Farm 
     Service Agency, if the Secretary determines that

[[Page H2743]]

     the proceeds of the loan will be used for a purpose that will 
     contribute to conversion of a wetland (other than as provided 
     in this subtitle) to produce an agricultural commodity.
       ``(3) During the crop year:
       ``(A) A payment made pursuant to a contract entered into 
     under the environmental quality incentives program under 
     chapter 4 of subtitle D.
       ``(B) A payment under any other provision of subtitle D.
       ``(C) A payment under section 401 or 402 of the 
     Agricultural Credit Act of 1978 (16 U.S.C. 2201 and 2202).
       ``(D) A payment, loan, or other assistance under section 3 
     or 8 of the Watershed Protection and Flood Prevention Act (16 
     U.S.C. 1003 and 1006a).''.
       (b) Conforming Amendments.--
       (1) Section 1221(c) of the Food Security Act of 1985 (as 
     redesignated by subsection (a)(1)) is amended--
       (A) by striking ``Except'' and inserting ``Wetland 
     Conversion.--Except'';
       (B) by striking ``subsequent to the date of enactment of 
     the Food, Agriculture, Conservation, and Trade Act of 1990'' 
     and inserting ``beginning after November 28, 1990,''; and
       (C) by striking ``subsections (a) (1) through (3)'' and 
     inserting ``subsection (b)''.
       (2) Section 1221 of the Food Security Act of 1985 (as 
     amended by subsection (a)) is amended by adding at the end 
     the following:
       ``(d) Prior Loans.--This section shall not apply to a loan 
     described in subsection (b) made before December 23, 1985.''.

     SEC. 322. DELINEATION OF WETLANDS; EXEMPTIONS TO PROGRAM 
                   INELIGIBILITY.

       (a) Delineation of Wetlands.--Section 1222 of the Food 
     Security Act of 1985 (16 U.S.C. 3822) is amended by striking 
     subsection (a) and inserting the following:
       ``(a) Delineation by the Secretary.--
       ``(1) In general.--Subject to subsection (b) and paragraph 
     (6), the Secretary shall delineate, determine, and certify 
     all wetlands located on subject land on a farm.
       ``(2) Wetland delineation maps.--The Secretary shall 
     delineate wetlands on wetland delineation maps. On the 
     request of a person, the Secretary shall make a reasonable 
     effort to make an on-site wetland determination prior to 
     delineation.
       ``(3) Certification.--On providing notice to affected 
     persons, the Secretary shall--
       ``(A) certify whether a map is sufficient for the purpose 
     of making a determination of ineligibility for program 
     benefits under section 1221; and
       ``(B) provide an opportunity to appeal the certification 
     prior to the certification becoming final.
       ``(4) Duration of certification.--A final certification 
     made under paragraph (3) shall remain valid and in effect as 
     long as the area is devoted to an agricultural use or until 
     such time as the person affected by the certification 
     requests review of the certification by the Secretary.
       ``(5) Review of mapping on appeal.--In the case of an 
     appeal of the Secretary's certification, the Secretary shall 
     review and certify the accuracy of the mapping of all land 
     subject to the appeal to ensure that the subject land has 
     been accurately delineated. Prior to rendering a decision on 
     the appeal, the Secretary shall conduct an on-site inspection 
     of the subject land on a farm.
       ``(6) Reliance on prior certified delineation.--No person 
     shall be adversely affected because of having taken an action 
     based on a previous certified wetland delineation by the 
     Secretary. The delineation shall not be subject to a 
     subsequent wetland certification or delineation by the 
     Secretary, unless requested by the person under paragraph 
     (4).''.
       (b) Exemptions.--Section 1222 of the Food Security Act of 
     1985 (16 U.S.C. 3822) is amended by striking subsection (b) 
     and inserting the following:
       ``(b) Exemptions.--No person shall become ineligible under 
     section 1221 for program loans or payments under the 
     following circumstances:
       ``(1) As the result of the production of an agricultural 
     commodity on the following lands:
       ``(A) A converted wetland if the conversion of the wetland 
     was commenced before December 23, 1985.
       ``(B) Land that is a nontidal drainage or irrigation ditch 
     excavated in upland.
       ``(C) A wet area created by a water delivery system, 
     irrigation, irrigation system, or application of water for 
     irrigation.
       ``(D) A wetland on which the owner or operator of a farm or 
     ranch uses normal cropping or ranching practices to produce 
     an agricultural commodity in a manner that is consistent for 
     the area where the production is possible as a result of a 
     natural condition, such as drought, and is without action by 
     the producer that destroys a natural wetland characteristic.
       ``(E) Land that is an artificial lake or pond created by 
     excavating or diking land (that is not a wetland) to collect 
     and retain water and that is used primarily for livestock 
     watering, fish production, irrigation, wildlife, fire 
     control, flood control, cranberry growing, or rice 
     production, or as a settling pond.
       ``(F) A wetland that is temporarily or incidentally created 
     as a result of adjacent development activity.
       ``(G) A converted wetland if the original conversion of the 
     wetland was commenced before December 23, 1985, and the 
     Secretary determines the wetland characteristics returned 
     after that date as a result of--
       ``(i) the lack of maintenance of drainage, dikes, levees, 
     or similar structures;
       ``(ii) a lack of management of the lands containing the 
     wetland; or
       ``(iii) circumstances beyond the control of the person.
       ``(H) A converted wetland, if--
       ``(i) the converted wetland was determined by the Natural 
     Resources Conservation Service to have been manipulated for 
     the production of an agricultural commodity or forage prior 
     to December 23, 1985, and was returned to wetland conditions 
     through a voluntary restoration, enhancement, or creation 
     action subsequent to that determination;
       ``(ii) technical determinations regarding the prior site 
     conditions and the restoration, enhancement, or creation 
     action have been adequately documented by the Natural 
     Resources Conservation Service;
       ``(iii) the proposed conversion action is approved by the 
     Natural Resources Conservation Service prior to 
     implementation; and
       ``(iv) the extent of the proposed conversion is limited so 
     that the conditions will be at least equivalent to the 
     wetland functions and values that existed prior to 
     implementation of the voluntary wetland restoration, 
     enhancement, or creation action.
       ``(2) For the conversion of the following:
       ``(A) An artificial lake or pond created by excavating or 
     diking land that is not a wetland to collect and retain water 
     and that is used primarily for livestock watering, fish 
     production, irrigation, wildlife, fire control, flood 
     control, cranberry growing, rice production, or as a settling 
     pond.
       ``(B) A wetland that is temporarily or incidentally created 
     as a result of adjacent development activity.
       ``(C) A wetland on which the owner or operator of a farm or 
     ranch uses normal cropping or ranching practices to produce 
     an agricultural commodity in a manner that is consistent for 
     the area where the production is possible as a result of a 
     natural condition, such as drought, and is without action by 
     the producer that destroys a natural wetland characteristic.
       ``(D) A wetland previously identified as a converted 
     wetland (if the original conversion of the wetland was 
     commenced before December 23, 1985), but that the Secretary 
     determines returned to wetland status after that date as a 
     result of--
       ``(i) the lack of maintenance of drainage, dikes, levees, 
     or similar structures;
       ``(ii) a lack of management of the lands containing the 
     wetland; or
       ``(iii) circumstances beyond the control of the person.
       ``(E) A wetland, if--
       ``(i) the wetland was determined by the Natural Resources 
     Conservation Service to have been manipulated for the 
     production of an agricultural commodity or forage prior to 
     December 23, 1985, and was returned to wetland conditions 
     through a voluntary restoration, enhancement, or creation 
     action subsequent to that determination;
       ``(ii) technical determinations regarding the prior site 
     conditions and the restoration, enhancement, or creation 
     action have been adequately documented by the Natural 
     Resources Conservation Service;,
       ``(iii) the proposed conversion action is approved by the 
     Natural Resources Conservation Service prior to 
     implementation; and
       ``(iv) the extent of the proposed conversion is limited so 
     that the conditions will be at least equivalent to the 
     wetland functions and values that existed prior to 
     implementation of the voluntary wetland restoration, 
     enhancement, or creation action.''.
       (c) Identification of Minimal Effect Exemptions.--Section 
     1222 of the Food Security Act of 1985 (16 U.S.C. 3822) is 
     amended by striking subsection (d) and inserting the 
     following:
       ``(d) Identification of Minimal Effect Exemptions.--For 
     purposes of applying the minimal effect exemption under 
     subsection (f)(1), the Secretary shall identify by regulation 
     categorical minimal effect exemptions on a regional basis to 
     assist persons in avoiding a violation of the ineligibility 
     provisions of section 1221. The Secretary shall ensure that 
     employees of the Department of Agriculture who administer 
     this subtitle receive appropriate training to properly apply 
     the minimal effect exemptions determined by the Secretary.''.
       (d) Minimal Effect and Mitigation Exemptions.--Section 1222 
     of the Food Security Act of 1985 (16 U.S.C. 3822) is amended 
     by striking subsection (f) and inserting the following:
       ``(f) Minimal Effect; Mitigation.--The Secretary shall 
     exempt a person from the ineligibility provisions of section 
     1221 for any action associated with the production of an 
     agricultural commodity on a converted wetland, or the 
     conversion of a wetland, if 1 or more of the following 
     conditions apply, as determined by the Secretary:
       ``(1) The action, individually and in connection with all 
     other similar actions authorized by the Secretary in the 
     area, will have a minimal effect on the functional 
     hydrological and biological value of the wetlands in the 
     area, including the value to waterfowl and wildlife.
       ``(2) The wetland and the wetland values, acreage, and 
     functions are mitigated by the person through the restoration 
     of a converted wetland, the enhancement of an existing 
     wetland, or the creation of a new wetland, and the 
     restoration, enhancement, or creation is--
       ``(A) in accordance with a wetland conservation plan;
       ``(B) in advance of, or concurrent with, the action;
       ``(C) not at the expense of the Federal Government;
       ``(D) in the case of enhancement or restoration of 
     wetlands, on not greater than a 1-for-1 acreage basis unless 
     more acreage is needed to provide equivalent functions and 
     values that will be lost as a result of the wetland 
     conversion to be mitigated;
       ``(E) in the case of creation of wetlands, on greater than 
     a 1-for-1 acreage basis if more acreage is needed to provide 
     equivalent functions

[[Page H2744]]

     and values that will be lost as a result of the wetland 
     conversion that is mitigated;
       ``(F) on lands in the same general area of the local 
     watershed as the converted wetland; and
       ``(G) with respect to the restored, enhanced, or created 
     wetland, made subject to an easement that--
       ``(i) is recorded on public land records;
       ``(ii) remains in force for as long as the converted 
     wetland for which the restoration, enhancement, or creation 
     to be mitigated remains in agricultural use or is not 
     returned to its original wetland classification with 
     equivalent functions and values; and
       ``(iii) prohibits making alterations to the restored, 
     enhanced, or created wetland that lower the wetland's 
     functions and values.
       ``(3) The wetland was converted after December 23, 1985, 
     but before November 28, 1990, and the wetland values, 
     acreage, and functions are mitigated by the producer through 
     the requirements of subparagraphs (A), (B), (C), (D), (F), 
     and (G) of paragraph (2).
       ``(4) The action was authorized by a permit issued under 
     section 404 of the Federal Water Pollution Control Act (33 
     U.S.C. 1344) and the wetland values, acreage, and functions 
     of the converted wetland were adequately mitigated for the 
     purposes of this subtitle.''.
       (e) References to Producer.--Section 1222(g) of the Food 
     Security Act of 1985 (16 U.S.C. 3822(g)) is amended by 
     striking ``producer'' and inserting ``person''.
       (f) Good Faith Exemption.--Section 1222 of the Food 
     Security Act of 1985 (16 U.S.C. 3822) is amended by striking 
     subsection (h) and inserting the following:
       ``(h) Good Faith Exemption.--
       ``(1) Exemption described.--The Secretary may waive a 
     person's ineligibility under section 1221 for program loans, 
     payments, and benefits as the result of the conversion of a 
     wetland subsequent to November 28, 1990, or the production of 
     an agricultural commodity on a converted wetland, if the 
     Secretary determines that the person has acted in good faith 
     and without intent to violate this subtitle.
       ``(2) Period for compliance.--The Secretary shall provide a 
     person who the Secretary determines has acted in good faith 
     and without intent to violate this subtitle with a reasonable 
     period, but not to exceed 1 year, during which to implement 
     the measures and practices necessary to be considered to 
     actively restoring the subject wetland.''.
       (g) Restoration.--Section 1222(i) of the Food Security Act 
     of 1985 (16 U.S.C. 3822(i)) is amended by inserting before 
     the period at the end the following: ``or has otherwise 
     mitigated for the loss of wetland values, as determined by 
     the Secretary, through the restoration, enhancement, or 
     creation of wetland values in the same general area of the 
     local watershed as the converted wetland''.
       (h) Determinations.--Section 1222 of the Food Security Act 
     of 1985 (16 U.S.C. 3822) is amended by striking subsection 
     (j) and inserting the following:
       ``(j) Determinations; Restoration and Mitigation Plans; 
     Monitoring Activities.--Technical determinations, the 
     development of restoration and mitigation plans, and 
     monitoring activities under this section shall be made by the 
     National Resources Conservation Service.''.
       (i) Mitigation Banking.--Section 1222 of the Food Security 
     Act of 1985 (16 U.S.C. 3822) is amended by adding at the end 
     the following:
       ``(k) Mitigation Banking Program.--Using authorities 
     available to the Secretary, the Secretary may operate a pilot 
     program for mitigation banking of wetlands to assist persons 
     to increase the efficiency of agricultural operations while 
     protecting wetland functions and values. Subsection (f)(2)(C) 
     shall not apply to this subsection.''.

     SEC. 323. CONSULTATION AND COOPERATION REQUIREMENTS.

       Section 1223 of the Food Security Act of 1985 (16 U.S.C. 
     3823) is repealed.

     SEC. 324. APPLICATION OF PROGRAM INELIGIBILITY TO AFFILIATED 
                   PERSONS.

       The Food Security Act of 1985 (as amended by section 323) 
     is amended by inserting after section 1222 (16 U.S.C. 3822) 
     the following:

     ``SEC. 1223. AFFILIATED PERSONS.

       ``If a person is affected by a reduction in benefits under 
     section 1221 and the affected person is affiliated with other 
     persons for the purpose of receiving the benefits, the 
     benefits of each affiliated person shall be reduced under 
     section 1221 in proportion to the interest held by the 
     affiliated person.''.

     SEC. 325. CLARIFICATION OF DEFINITION OF AGRICULTURAL LANDS 
                   IN MEMORANDUM OF AGREEMENT.

       (a) Agricultural Lands.--For purposes of implementing the 
     memorandum of agreement entered into between the Department 
     of Agriculture, the Environmental Protection Agency, the 
     Department of the Interior, and the Department of the Army on 
     January 6, 1994, relating to the delineation of wetlands, the 
     term ``agricultural lands'' shall include--
       (1) native pasture, rangelands, and other lands used to 
     produce or support the production of livestock; and
       (2) tree farms.
       (b) Wetland Conservation.--Subsection (a) shall not apply 
     with respect to the delineation of wetlands under subtitle C 
     of title XII of the Food Security Act of 1985 (16 U.S.C. 3821 
     et seq.) or to the enforcement of the subtitle.
       (c) Successor Memorandum.--Subsection (a) shall apply to 
     any amendment to or successor of the memorandum of agreement 
     described in subsection (a).

     SEC. 326. EFFECTIVE DATE.

       This subtitle and the amendments made by this subtitle 
     shall become effective 90 days after the date of enactment of 
     this Act.
     Subtitle D--Environmental Conservation Acreage Reserve Program

     SEC. 331. ENVIRONMENTAL CONSERVATION ACREAGE RESERVE PROGRAM.

       Section 1230 of the Food Security Act of 1985 (16 U.S.C. 
     3830) is amended to read as follows:

     ``SEC. 1230. ENVIRONMENTAL CONSERVATION ACREAGE RESERVE 
                   PROGRAM.

       ``(a) Establishment.--
       ``(1) In general.--During the 1996 through 2002 calendar 
     years, the Secretary shall establish an environmental 
     conservation acreage reserve program (referred to in this 
     section as `ECARP') to be implemented through contracts and 
     the acquisition of easements to assist owners and operators 
     of farms and ranches to conserve and enhance soil, water, and 
     related natural resources, including grazing land, wetland, 
     and wildlife habitat.
       ``(2) Means.--The Secretary shall carry out the ECARP by--
       ``(A) providing for the long-term protection of 
     environmentally sensitive land; and
       ``(B) providing technical and financial assistance to 
     farmers and ranchers to--
       ``(i) improve the management and operation of the farms and 
     ranches; and
       ``(ii) reconcile productivity and profitability with 
     protection and enhancement of the environment.
       ``(3) Programs.--The ECARP shall consist of--
       ``(A) the conservation reserve program established under 
     subchapter B;
       ``(B) the wetlands reserve program established under 
     subchapter C; and
       ``(C) the environmental quality incentives program 
     established under chapter 4.
       ``(b) Administration.--
       ``(1) In general.--In carrying out the ECARP, the Secretary 
     shall enter into contracts with owners and operators and 
     acquire interests in land through easements from owners, as 
     provided in this chapter and chapter 4.
       ``(2) Prior enrollments.--Acreage enrolled in the 
     conservation reserve or wetlands reserve program prior to the 
     date of enactment of this paragraph shall be considered to be 
     placed into the ECARP.
       ``(c) Conservation Priority Areas.--
       ``(1) Designation.--The Secretary may designate watersheds, 
     multistate areas, or regions of special environmental 
     sensitivity as conservation priority areas that are eligible 
     for enhanced assistance under this chapter and chapter 4.
       ``(2) Assistance.--The Secretary may designate areas as 
     conservation priority areas to assist, to the maximum extent 
     practicable, agricultural producers within the conservation 
     priority areas to comply with nonpoint source pollution 
     requirements under the Federal Water Pollution Control Act 
     (33 U.S.C. 1251 et seq.) and other Federal and State 
     environmental laws and to meet other conservation needs.
       ``(3) Producers.--The Secretary may provide technical 
     assistance, cost-share payments, and incentive payments to 
     producers in a conservation priority area under this chapter 
     and chapter 4 based on--
       ``(A) the significance of the soil, water, wildlife 
     habitat, and related natural resource problems in a 
     watershed, multistate area, or region; and
       ``(B) the structural practices or land management practices 
     that best address the problems, and that maximize 
     environmental benefits for each dollar expended, as 
     determined by the Secretary.''.

     SEC. 332. CONSERVATION RESERVE PROGRAM.

       (a) Program Extensions.--
       (1) Conservation reserve program.--Section 1231 of the Food 
     Security Act of 1985 (16 U.S.C. 3831) is amended by striking 
     ``1995'' each place it appears and inserting ``2002''.
       (2) Duties of owners and operators.--Section 1232(c) of the 
     Food Security Act of 1985 (16 U.S.C. 3832(c)) is amended by 
     striking ``1995'' and inserting ``2002''.
       (b) Maximum Enrollment.--Section 1231 of the Food Security 
     Act of 1985 (16 U.S.C. 3831) is amended by striking 
     subsection (d) and inserting the following:
       ``(d) Maximum Enrollment.--The Secretary may maintain up to 
     36,400,000 acres in the conservation reserve at any one time 
     during the 1986 through 2002 calendar years (including 
     contracts extended by the Secretary pursuant to section 
     1437(c) of the Food, Agriculture, Conservation, and Trade Act 
     of 1990 (Public Law 101-624; 16 U.S.C. 3831 note).''.
       (c) Optional Contract Termination by Producers.--Section 
     1235 of the Food Security Act of 1985 (16 U.S.C. 3835) is 
     amended--
       (1) in subsection (a)--
       (A) in paragraph (1), by striking ``3-year'' and inserting 
     ``1-year''; and
       (B) in paragraph (2)(B)(i), by striking ``3 years'' and 
     inserting ``1 year''; and
       (2) by adding at the end the following:
       ``(e) Termination by Owner or Operator.--
       ``(1) Early termination authorized.--Subject to the other 
     provisions of this subsection, the Secretary shall allow a 
     participant who entered into a contract before January 1, 
     1995, to terminate the contract at any time if the contract 
     has been in effect for at least 5 years. The termination 
     shall not relieve the participant of liability for a contract 
     violation occurring before the date of the termination. The 
     participant shall provide the Secretary with reasonable 
     notice of the participant's desire to terminate the contract.
       ``(2) Certain lands excepted.--The following lands shall 
     not be subject to an early termination of contract under this 
     subsection:
       ``(A) Filterstrips, waterways, strips adjacent to riparian 
     areas, windbreaks, and shelterbelts.
       ``(B) Land with an erodibility index of more than 15.
       ``(C) Other lands of high environmental value (including 
     wetlands), as determined by the Secretary.
       ``(3) Effective date.--The contract termination shall 
     become effective 60 days after the

[[Page H2745]]

     date on which the owner or operator submits the notice 
     required under paragraph (1).
       ``(4) Prorated rental payment.--If a contract entered into 
     under this subchapter is terminated under this subsection 
     before the end of the fiscal year for which a rental payment 
     is due, the Secretary shall provide a prorated rental payment 
     covering the portion of the fiscal year during which the 
     contract was in effect.
       ``(5) Renewed enrollment.--The termination of a contract 
     entered into under this subchapter shall not affect the 
     ability of the owner or operator who requested the 
     termination to submit a subsequent bid to enroll the land 
     that was subject to the contract into the conservation 
     reserve.
       ``(6) Conservation requirements.--If land that was subject 
     to a contract is returned to production of an agricultural 
     commodity, the conservation requirements under subtitles B 
     and C shall apply to the use of the land to the extent that 
     the requirements are similar to those requirements imposed on 
     other similar lands in the area, except than the requirements 
     may not be more onerous than the requirements imposed on 
     other lands.''.
       (d) Enrollments in 1997.--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 ``: Provided,'' and all 
     that follows through ``1997''.

     SEC. 333. WETLANDS RESERVE PROGRAM.

       (a) Enrollment.--Section 1237 of the Food Security Act of 
     1985 (16 U.S.C. 3837) is amended by striking subsection (b) 
     and inserting the following:
       ``(b) Enrollment Conditions.--
       ``(1) Maximum enrollment.--The total number of acres 
     enrolled in the wetlands reserve program shall not exceed 
     975,000 acres.
       ``(2) Methods of enrollment.--
       ``(A) In general.--Subject to subparagraph (B), effective 
     beginning October 1, 1996, to the maximum extent practicable, 
     the Secretary shall enroll into the wetlands reserve 
     program--
       ``(i) \1/3\ of the acres through the use of permanent 
     easements;
       ``(ii) \1/3\ of the acres through the use of 30-year 
     easements; and
       ``(iii) \1/3\ of the acres through the use of restoration 
     cost-share agreements.
       ``(B) Temporary easements.--Effective beginning October 1, 
     1996, the Secretary shall not enroll acres in the wetlands 
     reserve program through the use of new permanent easements 
     until the Secretary has enrolled at least 75,000 acres in the 
     program through the use of temporary easements.''.
       (b) Eligibility.--Section 1237(c) of the Food Security Act 
     of 1985 (16 U.S.C. 3837(c)) is amended--
       (1) by striking ``2000'' and inserting ``2002'';
       (2) by redesignating paragraphs (1) and (2) as paragraphs 
     (2) and (3), respectively; and
       (3) by inserting after ``determines that--'' the following:
       ``(1) such land maximizes wildlife benefits and wetland 
     values and functions;''.
       (c) Other Eligible Lands.--Section 1237(d) of the Food 
     Security Act of 1985 (16 U.S.C. 3837(d)) is amended--
       (1) by inserting after ``subsection (c)'' the following ``, 
     land that maximizes wildlife benefits and that is''; and
       (2) in paragraph (2), by striking ``and'' at the end and 
     inserting ``or''.
       (d) Easements.--Section 1237A of the Food Security Act of 
     1985 (16 U.S.C. 3837a) is amended--
       (1) in the section heading, by inserting before the period 
     at the end the following: ``AND AGREEMENTS'';
       (2) by striking subsection (c) and inserting the following:
       ``(c) Restoration Plans.--The development of a restoration 
     plan, including any compatible use, under this section shall 
     be made through the local Natural Resources Conservation 
     Service representative, in consultation with the State 
     technical committee.'';
       (3) in subsection (f), by striking the third sentence and 
     inserting the following: ``Compensation may be provided in 
     not less than 5, nor more than 30, annual payments of equal 
     or unequal size, as agreed to by the owner and the 
     Secretary.''; and
       (4) by adding at the end the following:
       ``(h) Restoration Cost-Share Agreements.--The Secretary may 
     enroll land into the wetlands reserve program through an 
     agreement that requires the landowner to restore wetlands on 
     the land, if the agreement does not provide the Secretary 
     with an easement.''.
       (e) Cost-Share and Technical Assistance.--Section 1237C of 
     the Food Security Act of 1985 (16 U.S.C. 3837c) is amended by 
     striking subsection (b) and inserting the following:
       ``(b) Cost-Share and Technical Assistance.--
       ``(1) Easements.--Effective beginning October 1, 1996, in 
     making cost-share payments under subsection (a)(1), the 
     Secretary shall--
       ``(A) in the case of a permanent easement, pay the owner an 
     amount that is not less than 75 percent, but not more than 
     100 percent, of the eligible costs; and
       ``(B) in the case of a 30-year easement, pay the owner an 
     amount that is not less than 50 percent, but not more than 75 
     percent, of the eligible costs.
       ``(2) Restoration cost-share agreements.--In making cost-
     share payments in connection with a restoration cost-share 
     agreement entered into under section 1237A(h), the Secretary 
     shall pay the owner an amount that is not less than 50 
     percent, but not more than 75 percent, of the eligible costs.
       ``(3) Technical assistance.--The Secretary shall provide 
     owners with technical assistance to assist owners in 
     complying with the terms of easements and restoration cost-
     share agreements.''.
       (f) Effect on Existing Agreements.--The amendments made by 
     this section shall not affect the validity or terms of any 
     agreements entered into by the Secretary of Agriculture under 
     subchapter C of chapter 1 of subtitle D of title XII of the 
     Food Security Act of 1985 (16 U.S.C. 3837 et seq.) before the 
     date of enactment of this Act or any payments required to be 
     made in connection with the agreements.

     SEC. 334. ENVIRONMENTAL QUALITY INCENTIVES 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--ENVIRONMENTAL QUALITY INCENTIVES PROGRAM

     ``SEC. 1240. PURPOSES.

       ``The purposes of the environmental quality incentives 
     program established by this chapter are to--
       ``(1) combine into a single program the functions of--
       ``(A) the agricultural conservation program authorized by 
     sections 7 and 8 of the Soil Conservation and Domestic 
     Allotment Act (16 U.S.C. 590g and 590h) (as in effect before 
     the amendments made by section 336(a)(1) of the Federal 
     Agriculture Improvement and Reform Act of 1996);
       ``(B) the Great Plains conservation program established 
     under section 16(b) of the Soil Conservation and Domestic 
     Allotment Act (16 U.S.C. 590p(b)) (as in effect before the 
     amendment made by section 336(b)(1) of the Federal 
     Agriculture Improvement and Reform Act of 1996);
       ``(C) the water quality incentives program established 
     under chapter 2 (as in effect before the amendment made by 
     section 336(h) of the Federal Agriculture Improvement and 
     Reform Act of 1996); and
       ``(D) the Colorado River Basin salinity control program 
     established under section 202(c) of the Colorado River Basin 
     Salinity Control Act (43 U.S.C. 1592(c)) (as in effect before 
     the amendment made by section 336(c)(1) of the Federal 
     Agriculture Improvement and Reform Act of 1996); and
       ``(2) carry out the single program in a manner that 
     maximizes environmental benefits per dollar expended, and 
     that provides--
       ``(A) flexible technical and financial assistance to 
     farmers and ranchers that face the most serious threats to 
     soil, water, and related natural resources, including grazing 
     lands, wetlands, and wildlife habitat;
       ``(B) assistance to farmers and ranchers in complying with 
     this title and Federal and State environmental laws, and 
     encourages environmental enhancement;
       ``(C) assistance to farmers and ranchers in making 
     beneficial, cost-effective changes to cropping systems, 
     grazing management, manure, nutrient, pest, or irrigation 
     management, land uses, or other measures needed to conserve 
     and improve soil, water, and related natural resources; and
       ``(D) for the consolidation and simplification of the 
     conservation planning process to reduce administrative 
     burdens on producers.

     ``SEC. 1240A. DEFINITIONS.

       ``In this chapter:
       ``(1) Eligible land.--The term `eligible land' means 
     agricultural land (including cropland, rangeland, pasture, 
     and other land on which crops or livestock are produced), 
     including agricultural land that the Secretary determines 
     poses a serious threat to soil, water, or related resources 
     by reason of the soil types, terrain, climatic, soil, 
     topographic, flood, or saline characteristics, or other 
     factors or natural hazards.
       ``(2) Land management practice.--The term `land management 
     practice' means a site-specific nutrient or manure 
     management, integrated pest management, irrigation 
     management, tillage or residue management, grazing 
     management, or other land management practice carried out on 
     eligible land that the Secretary determines is needed to 
     protect, in the most cost-effective manner, water, soil, or 
     related resources from degradation.
       ``(3) Livestock.--The term `livestock' means dairy cattle, 
     beef cattle, laying hens, broilers, turkeys, swine, sheep, 
     and such other animals as determined by the Secretary.
       ``(4) Producer.--The term `producer' means a person who is 
     engaged in livestock or agricultural production (as defined 
     by the Secretary).
       ``(5) Structural practice.--The term `structural practice' 
     means--
       ``(A) the establishment on eligible land of a site-specific 
     animal waste management facility, terrace, grassed waterway, 
     contour grass strip, filterstrip, tailwater pit, permanent 
     wildlife habitat, or other structural practice that the 
     Secretary determines is needed to protect, in the most cost-
     effective manner, water, soil, or related resources from 
     degradation; and
       ``(B) the capping of abandoned wells on eligible land.

     ``SEC. 1240B. ESTABLISHMENT AND ADMINISTRATION OF 
                   ENVIRONMENTAL QUALITY INCENTIVES PROGRAM.

       ``(a) Establishment.--
       ``(1) In general.--During the 1996 through 2002 fiscal 
     years, the Secretary shall provide technical assistance, 
     cost-share payments, incentive payments, and education to 
     producers, who enter into contracts with the Secretary, 
     through an environmental quality incentives program in 
     accordance with this chapter.
       ``(2) Eligible practices.--
       ``(A) Structural practices.--A producer who implements a 
     structural practice shall be eligible for any combination of 
     technical assistance, cost-share payments, and education.
       ``(B) Land management practices.--A producer who performs a 
     land management practice shall be eligible for any 
     combination of technical assistance, incentive payments, and 
     education.

[[Page H2746]]

       ``(b) Application and Term.--A contract between a producer 
     and the Secretary under this chapter may--
       ``(1) apply to 1 or more structural practices or 1 or more 
     land management practices, or both; and
       ``(2) have a term of not less than 5, nor more than 10, 
     years, as determined appropriate by the Secretary, depending 
     on the practice or practices that are the basis of the 
     contract.
       ``(c) Structural Practices.--
       ``(1) Offer selection process.--The Secretary shall, to the 
     maximum extent practicable, establish a process for selecting 
     applications for financial assistance if there are numerous 
     applications for assistance for structural practices that 
     would provide substantially the same level of environmental 
     benefits. The process shall be based on--
       ``(A) a reasonable estimate of the projected cost of the 
     proposals and other factors identified by the Secretary for 
     determining which applications will result in the least cost 
     to the program authorized by this chapter; and
       ``(B) the priorities established under this subtitle and 
     such other factors determined by the Secretary that maximize 
     environmental benefits per dollar expended.
       ``(2) Concurrence of owner.--If the producer making an 
     offer to implement a structural practice is a tenant of the 
     land involved in agricultural production, for the offer to be 
     acceptable, the producer shall obtain the concurrence of the 
     owner of the land with respect to the offer.
       ``(d) Land Management Practices.--The Secretary shall 
     establish an application and evaluation process for awarding 
     technical assistance or incentive payments, or both, to a 
     producer in exchange for the performance of 1 or more land 
     management practices by the producer.
       ``(e) Cost-Share Payments, Incentive Payments, and 
     Technical Assistance.--
       ``(1) Cost-share payments.--
       ``(A) In general.--The Federal share of cost-share payments 
     to a producer proposing to implement 1 or more structural 
     practices shall be not more than 75 percent of the projected 
     cost of the practice, as determined by the Secretary, taking 
     into consideration any payment received by the producer from 
     a State or local government.
       ``(B) Limitation.--A producer who owns or operates a large 
     confined livestock operation (as defined by the Secretary) 
     shall not be eligible for cost-share payments to construct an 
     animal waste management facility.
       ``(C) Other payments.--A producer shall not be eligible for 
     cost-share payments for structural practices on eligible land 
     under this chapter if the producer receives cost-share 
     payments or other benefits for the same land under chapter 1 
     or 3.
       ``(2) Incentive payments.--The Secretary shall make 
     incentive payments in an amount and at a rate determined by 
     the Secretary to be necessary to encourage a producer to 
     perform 1 or more land management practices.
       ``(3) Technical assistance.--
       ``(A) Funding.--The Secretary shall allocate funding under 
     this chapter for the provision of technical assistance 
     according to the purpose and projected cost for which the 
     technical assistance is provided for a fiscal year. The 
     allocated amount may vary according to the type of expertise 
     required, quantity of time involved, and other factors as 
     determined appropriate by the Secretary. Funding shall not 
     exceed the projected cost to the Secretary of the technical 
     assistance provided for a fiscal year.
       ``(B) Other authorities.--The receipt of technical 
     assistance under this chapter shall not affect the 
     eligibility of the producer to receive technical assistance 
     under other authorities of law available to the Secretary.
       ``(C) Private sources.--The Secretary shall ensure that the 
     processes of writing and developing proposals and plans for 
     contracts under this chapter, and of assisting in the 
     implementation of structural practices and land management 
     practices covered by the contracts, are open to individuals 
     in agribusiness, including agricultural producers, 
     representatives from agricultural cooperatives, agricultural 
     input retail dealers, and certified crop advisers. The 
     requirements of this subparagraph shall also apply to any 
     other conservation program of the Department of Agriculture 
     that provides incentive payments, technical assistance, or 
     cost-share payments.
       ``(f) Modification or Termination of Contracts.--
       ``(1) Voluntary modification or termination.--The Secretary 
     may modify or terminate a contract entered into with a 
     producer under this chapter if--
       ``(A) the producer agrees to the modification or 
     termination; and
       ``(B) the Secretary determines that the modification or 
     termination is in the public interest.
       ``(2) Involuntary termination.--The Secretary may terminate 
     a contract under this chapter if the Secretary determines 
     that the producer violated the contract.
       ``(g) Non-Federal Assistance.--The Secretary may request 
     the services of a State water quality agency, State fish and 
     wildlife agency, State forestry agency, or any other 
     governmental or private resource considered appropriate to 
     assist in providing the technical assistance necessary for 
     the development and implementation of a structural practice 
     or land management practice.

     ``SEC. 1240C. EVALUATION OF OFFERS AND PAYMENTS.

       ``In providing technical assistance, cost-share payments, 
     and incentive payments to producers, the Secretary shall 
     accord a higher priority to assistance and payments that--
       ``(1) are provided in conservation priority areas 
     established under section 1230(c);
       ``(2) maximize environmental benefits per dollar expended; 
     or
       ``(3) are provided in watersheds, regions, or conservation 
     priority areas in which State or local governments have 
     provided, or will provide, financial or technical assistance 
     to producers for the same conservation or environmental 
     purposes.

     ``SEC. 1240D. DUTIES OF PRODUCERS.

       ``To receive technical assistance, cost-share payments, or 
     incentive payments under this chapter, a producer shall 
     agree--
       ``(1) to implement an environmental quality incentives 
     program plan that describes conservation and environmental 
     goals to be achieved through a structural practice or land 
     management practice, or both, that is approved by the 
     Secretary;
       ``(2) not to conduct any practices on the farm or ranch 
     that would tend to defeat the purposes of this chapter;
       ``(3) on the violation of a term or condition of the 
     contract at any time the producer has control of the land, to 
     refund any cost-share or incentive payment received with 
     interest, and forfeit any future payments under this chapter, 
     as determined by the Secretary;
       ``(4) on the transfer of the right and interest of the 
     producer in land subject to the contract, unless the 
     transferee of the right and interest agrees with the 
     Secretary to assume all obligations of the contract, to 
     refund all cost-share payments and incentive payments 
     received under this chapter, as determined by the Secretary;
       ``(5) to supply information as required by the Secretary to 
     determine compliance with the environmental quality 
     incentives program plan and requirements of the program; and
       ``(6) to comply with such additional provisions as the 
     Secretary determines are necessary to carry out the 
     environmental quality incentives program plan.

     ``SEC. 1240E. ENVIRONMENTAL QUALITY INCENTIVES PROGRAM PLAN.

       ``(a) In General.--To be eligible to enter into a contract 
     under the environmental quality incentives program, an owner 
     or producer of a livestock or agricultural operation must 
     submit to the Secretary for approval a plan of operations 
     that incorporates such conservation practices, and is based 
     on such principles, as the Secretary considers necessary to 
     carry out the program, including a description of structural 
     practices and land management practices to be implemented and 
     the objectives to be met by the plan's implementation.
       ``(b) Avoidance of Duplication.--The Secretary shall, to 
     the maximum extent practicable, eliminate duplication of 
     planning activities under the environmental quality 
     incentives program and comparable conservation programs.

     ``SEC. 1240F. DUTIES OF THE SECRETARY.

       ``To the extent appropriate, the Secretary shall assist a 
     producer in achieving the conservation and environmental 
     goals of an environmental quality incentives program plan 
     by--
       ``(1) providing an eligibility assessment of the farming or 
     ranching operation of the producer as a basis for developing 
     the plan;
       ``(2) providing technical assistance in developing and 
     implementing the plan;
       ``(3) providing technical assistance, cost-share payments, 
     or incentive payments for developing and implementing 1 or 
     more structural practices or 1 or more land management 
     practices, as appropriate;
       ``(4) providing the producer with information, education, 
     and training to aid in implementation of the plan; and
       ``(5) encouraging the producer to obtain technical 
     assistance, cost-share payments, or grants from other 
     Federal, State, local, or private sources.

     ``SEC. 1240G. LIMITATION ON PAYMENTS.

       ``(a) In General.--The total amount of cost-share and 
     incentive payments paid to a producer under this chapter may 
     not exceed--
       ``(1) $10,000 for any fiscal year; or
       ``(2) $50,000 for any multiyear contract.
       ``(b) Exception to Annual Limit.--The Secretary may exceed 
     the limitation on the annual amount of a payment under 
     subsection (a)(1) on a case-by-case basis if the Secretary 
     determines that a larger payment is--
       ``(1) essential to accomplish the land management practice 
     or structural practice for which the payment is made; and
       ``(2) consistent with the maximization of environmental 
     benefits per dollar expended and the purposes of this chapter 
     specified in section 1240.
       ``(c) Timing of Expenditures.--Expenditures under a 
     contract entered into under this chapter during a fiscal year 
     may not be made by the Secretary until the subsequent fiscal 
     year.

     ``SEC. 1240H. TEMPORARY ADMINISTRATION OF ENVIRONMENTAL 
                   QUALITY INCENTIVES PROGRAM.

       ``(a) Interim Administration.--
       ``(1) In general.--During the period beginning on the date 
     of enactment of this section and ending on the termination 
     date provided under paragraph (2), to ensure that technical 
     assistance, cost-share payments, and incentive payments 
     continue to be administered in an orderly manner until such 
     time as assistance can be provided through final regulations 
     issued to implement the environmental quality incentives 
     program established under this chapter, the Secretary shall 
     continue to--
       ``(A) provide technical assistance, cost-share payments, 
     and incentive payments under the terms and conditions of the 
     agricultural conservation program, the Great Plains 
     conservation program, the water quality incentives program, 
     and the Colorado River Basin salinity control program, to the 
     extent the terms and conditions of the program are consistent 
     with the environmental quality incentives program; and

[[Page H2747]]

       ``(B) use for those purposes--
       ``(i) any funds remaining available for the agricultural 
     conservation program, the Great Plains conservation program, 
     the water quality incentives program, and the Colorado River 
     Basin salinity control program; and
       ``(ii) as the Secretary determines to be necessary, any 
     funds authorized to be used to carry out the environmental 
     quality incentives program.
       ``(2) Termination of authority.--The authority of the 
     Secretary to carry out paragraph (1) shall terminate on the 
     date that is 180 days after the date of enactment of this 
     section.
       ``(b) Permanent Administration.--Effective beginning on the 
     termination date provided under subsection (a)(2), the 
     Secretary shall provide technical assistance, cost-share 
     payments, and incentive payments for structural practices and 
     land management practices related to crop and livestock 
     production in accordance with final regulations issued to 
     carry out the environmental quality incentives program.''.

     SEC. 335. CONSERVATION FARM OPTION.

       Subtitle D of title XII of the Food Security Act of 1985 
     (16 U.S.C. 3830 et seq.) (as amended by section 334) is 
     amended by adding at the end the following:

                 ``CHAPTER 5--CONSERVATION FARM OPTION

     ``SEC. 1240M. CONSERVATION FARM OPTION.

       ``(a) In General.--The Secretary shall establish 
     conservation farm option pilot programs for producers of 
     wheat, feed grains, cotton, and rice.
       ``(b) Eligible Owners and Producers.--An owner or producer 
     with a farm that has contract acreage enrolled in the 
     agricultural market transition program established under the 
     Agricultural Market Transition Act shall be eligible to 
     participate in the conservation farm option offered under a 
     pilot program under subsection (a) if the owner or producer 
     meets the conditions established under section (e).
       ``(c) Purposes.--The purposes of the conservation farm 
     option pilot programs shall include--
       ``(1) conservation of soil, water, and related resources;
       ``(2) water quality protection or improvement;
       ``(3) wetland restoration, protection, and creation;
       ``(4) wildlife habitat development and protection; or
       ``(5) other similar conservation purposes.
       ``(d) Conservation Farm Plan.--
       ``(1) In general.--To be eligible to enter into a 
     conservation farm option contract, an owner or producer must 
     prepare and submit to the Secretary, for approval, a 
     conservation farm plan that shall become a part of the 
     conservation farm option contract.
       ``(2) Requirements.--A conservation farm plan shall--
       ``(A) describe the resource-conserving crop rotations, and 
     all other conservation practices, to be implemented and 
     maintained on the acreage that is subject to contract during 
     the contract period;
       ``(B) contain a schedule for the implementation and 
     maintenance of the practices described in the conservation 
     farm plan;
       ``(C) comply with highly erodible land and wetland 
     conservation requirements of this title; and
       ``(D) contain such other terms as the Secretary may 
     require.
       ``(e) Contracts.--
       ``(1) In general.--On approval of a conservation farm plan, 
     the Secretary may enter into a contract with the owner or 
     producer that specifies the acres being enrolled and the 
     practices being adopted.
       ``(2) Duration of contract.--The contract shall be for a 
     period of 10 years. The contract may be renewed for a period 
     of not to exceed 5 years on mutual agreement of the Secretary 
     and the owner or producer.
       ``(3) Consideration.--In exchange for payments under this 
     subsection, the owner or producer shall not participate in 
     and shall forgo payments under--
       ``(A) the conservation reserve program established under 
     subchapter B of chapter 1;
       ``(B) the wetlands reserve program established under 
     subchapter C of chapter 1; and
       ``(C) the environmental quality incentives program 
     established under chapter 4.
       ``(4) Owner or producer responsibilities under the 
     agreement.--Under the terms of the contract entered into 
     under this section, an owner or producer shall agree to--
       ``(A) actively comply with the terms and conditions of the 
     approved conservation farm plan;
       ``(B) keep such records as the Secretary may reasonably 
     require for purposes of evaluation of the implementation of 
     the conservation farm plan; and
       ``(C) not engage in any activity that would defeat the 
     purposes of the conservation farm option pilot program.
       ``(5) Payments.--The Secretary shall offer an owner or 
     producer annual payments under the contract that are 
     equivalent to the payments the owner or producer would have 
     received under the conservation reserve program, the wetlands 
     reserve program, and the environmental quality incentives 
     program.
       ``(6) Balance of benefits.--The Secretary shall not permit 
     an owner or producer to terminate a conservation reserve 
     program contract and enter a conservation farm option 
     contract if the Secretary determines that such action will 
     reduce net environmental benefits.
       ``(f) Secretarial Determinations.--
       ``(1) Acreage estimates.--Prior to each year during which 
     the Secretary intends to offer conservation reserve program 
     contracts, the Secretary shall estimate the number of acres 
     that--
       ``(A) will be retired under the conservation farm option 
     under the terms and conditions the Secretary intends to offer 
     for that program; and
       ``(B) would be retired under the conservation reserve 
     program if the conservation farm option were not available.
       ``(2) Total land retirement.--The Secretary shall announce 
     a number of acres to be enrolled in the conservation reserve 
     program that will result in a total number of acres retired 
     under the conservation reserve program and the conservation 
     farm option that does not exceed the amount estimated under 
     paragraph (1)(B) for the current or future years.
       ``(3) Limitation.--The Secretary shall not enroll 
     additional conservation reserve program contracts to offset 
     the land retired under the conservation farm option.
       ``(g) Commodity Credit Corporation.--The Secretary shall 
     use the funds, authorities, and facilities of the Commodity 
     Credit Corporation to carry out this subsection.
       ``(h) Funding.--Of the funds of the Commodity Credit 
     Corporation, the Corporation shall make available to carry 
     out this section--
       ``(1) $7,500,000 for fiscal year 1997;
       ``(2) $15,000,000 for fiscal year 1998;
       ``(3) $25,000,000 for fiscal year 1999;
       ``(4) $37,500,000 for fiscal year 2000;
       ``(5) $50,000,000 for fiscal year 2001; and
       ``(6) $62,500,000 for fiscal year 2002.''.

     SEC. 336. REPEAL OF SUPERSEDED AUTHORITIES.

       (a) Agricultural Conservation Program.--
       (1) Elimination.--
       (A) Section 8 of the Soil Conservation and Domestic 
     Allotment Act (16 U.S.C. 590h) is amended--
       (i) in subsection (b)--

       (I) by striking paragraphs (1) through (4) and inserting 
     the following:

       ``(1) Environmental quality incentives program.--The 
     Secretary shall provide technical assistance, cost-share 
     payments, and incentive payments to operators through the 
     environmental quality incentives program in accordance with 
     chapter 4 of subtitle D of title XII of the Food Security Act 
     of 1985.''; and

       (II) by striking paragraphs (6) through (8); and

       (ii) by striking subsections (d), (e), and (f).
       (B) The first sentence of section 11 of the Soil 
     Conservation and Domestic Allotment Act (16 U.S.C. 590k) is 
     amended by striking ``performance: Provided further,'' and 
     all that follows through ``or other law'' and inserting 
     ``performance''.
       (C) Section 14 of the Soil Conservation and Domestic 
     Allotment Act (16 U.S.C. 590n) is amended--
       (i) in the first sentence, by striking ``or 8''; and
       (ii) by striking the second sentence.
       (D) Section 15 of the Soil Conservation and Domestic 
     Allotment Act (16 U.S.C. 590o) is amended--
       (i) in the first undesignated paragraph--

       (I) in the first sentence, by striking ``sections 7 and 8'' 
     and inserting ``section 7''; and
       (II) by striking the third sentence; and

       (ii) by striking the second undesignated paragraph.
       (2) Conforming amendments.--
       (A) Paragraph (1) of the last proviso of the matter under 
     the heading ``conservation reserve program'' under the 
     heading ``Soil Bank Programs'' of title I of the Department 
     of Agriculture and Farm Credit Administration Appropriation 
     Act, 1959 (72 Stat. 195; 7 U.S.C. 1831a), is amended by 
     striking ``Agricultural Conservation Program'' and inserting 
     ``environmental quality incentives program established under 
     chapter 4 of subtitle D of title XII of the Food Security Act 
     of 1985''.
       (B) Section 4 of the Cooperative Forestry Assistance Act of 
     1978 (16 U.S.C. 2103) is amended by striking ``as added by 
     the Agriculture and Consumer Protection Act of 1973'' each 
     place it appears in subsections (d) and (i) and inserting 
     ``as in effect before the amendment made by section 336(d)(1) 
     of the Federal Agriculture Improvement and Reform Act of 
     1996''.
       (C) Section 226(b)(4) of the Department of Agriculture 
     Reorganization Act of 1994 (7 U.S.C. 6932(b)(4)) is amended 
     by striking ``and the agricultural conservation program under 
     the Soil Conservation and Domestic Allotment Act (16 U.S.C. 
     590g et seq.)''.
       (D) Section 246(b)(8) of the Department of Agriculture 
     Reorganization Act of 1994 (7 U.S.C. 6962(b)(8)) is amended 
     by striking ``and the agricultural conservation program under 
     the Soil Conservation and Domestic Allotment Act (16 U.S.C. 
     590g et seq.)''.
       (E) Section 1271(c)(3)(C) of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (16 U.S.C. 
     2106a(c)(3)(C)) is amended by striking ``Agricultural 
     Conservation Program established under section 16(b) of the 
     Soil Conservation and Domestic Allotment Act (16 U.S.C. 590h, 
     590l, or 590p)'' and inserting ``environmental quality 
     incentives program established under chapter 4 of subtitle D 
     of title XII of the Food Security Act of 1985''.
       (F) Section 304(a) of the Lake Champlain Special 
     Designation Act of 1990 (Public Law 101-596; 33 U.S.C. 1270 
     note) is amended--
       (i) in the subsection heading, by striking ``Special 
     Project Area Under the Agricultural Conservation Program'' 
     and inserting ``Priority Area Under the Environmental Quality 
     Incentives Program''; and
       (ii) in paragraph (1), by striking ``special project area 
     under the Agricultural Conservation Program established under 
     section 8(b) of the Soil Conservation and Domestic Allotment 
     Act (16 U.S.C. 590h(b))'' and inserting ``priority area under 
     the environmental quality incentives program established 
     under chapter 4 of subtitle D of title XII of the Food 
     Security Act of 1985''.
       (G) Section 6 of the Department of Agriculture Organic Act 
     of 1956 (70 Stat. 1033) is amended by striking subsection 
     (b).
       (b) Great Plains Conservation Program.--
       (1) Elimination.--Section 16 of the Soil Conservation and 
     Domestic Allotment Act (16 U.S.C. 590p) is repealed.

[[Page H2748]]

       (2) Conforming amendments.--
       (A) The Agricultural Adjustment Act of 1938 is amended by 
     striking ``Great Plains program'' each place it appears in 
     sections 344(f)(8) and 377 (7 U.S.C. 1344(f)(8) and 1377) and 
     inserting ``environmental quality incentives program 
     established under chapter 4 of subtitle D of title XII of the 
     Food Security Act of 1985''.
       (B) Section 246(b) of the Department of Agriculture 
     Reorganization Act of 1994 (7 U.S.C. 6962(b)) is amended by 
     striking paragraph (2).
       (c) Colorado River Basin Salinity Control Program.--
       (1) In general.--Section 202 of the Colorado River Basin 
     Salinity Control Act (43 U.S.C. 1592) is amended by striking 
     subsection (c) and inserting the following:
       ``(c) Salinity Control Measures.--The Secretary of 
     Agriculture shall carry out salinity control measures 
     (including watershed enhancement and cost-share measures with 
     livestock and crop producers) in the Colorado River Basin as 
     part of the environmental quality incentives program 
     established under chapter 4 of subtitle D of title XII of the 
     Food Security Act of 1985.''.
       (2) Funds.--Section 205 of the Colorado River Basin 
     Salinity Control Act (43 U.S.C. 1595) is amended--
       (A) in subsection (a), by striking ``pursuant to section 
     202(c)(2)(C)''; and
       (B) by adding at the end the following:
       ``(f) Funds.--The Secretary may expend funds available in 
     the Basin Funds referred to in this section to carry out 
     cost-share salinity measures in a manner that is consistent 
     with the cost allocations required under this section.''.
       (3) Conforming amendment.--Section 246(b)(6) of the 
     Department of Agriculture Reorganization Act of 1994 (7 
     U.S.C. 6962(b)(6)) is amended by striking ``program'' and 
     inserting ``measures''.
       (d) Rural Environmental Conservation Program.--
       (1) Elimination.--Title X of the Agricultural Act of 1970 
     (16 U.S.C. 1501 et seq.) is repealed.
       (2) Conforming amendments.--Section 246 of the Department 
     of Agriculture Reorganization Act of 1994 (7 U.S.C. 6962) (as 
     amended by subsection (b)(2)(B))) is amended--
       (A) in subsection (b)--
       (i) by striking paragraph (1); and
       (ii) by redesignating paragraphs (3) through (8) as 
     paragraphs (1) through (6), respectively; and
       (B) in subsection (c), by striking ``(2), (3), (4), and 
     (6)'' and inserting ``(1), (2), and (4)''.
       (e) Other Conservation Provisions.--Subtitle F of title XII 
     of the Food Security Act of 1985 (16 U.S.C. 2005a and 2101 
     note) is repealed.
       (f) Resource Conservation.--
       (1) Elimination.--Subtitles A, B, D, E, and F of title XV 
     of the Agriculture and Food Act of 1981 (95 Stat. 1328; 16 
     U.S.C. 3401 et seq.) are repealed.
       (2) Conforming amendment.--Section 739 of the Agriculture, 
     Rural Development, Food and Drug Administration, and Related 
     Agencies Appropriations Act, 1992 (7 U.S.C. 2272a), is 
     repealed.
       (g) Technical Amendment.--The first sentence of the matter 
     under the heading ``Commodity Credit Corporation'' of Public 
     Law 99-263 (100 Stat. 59; 16 U.S.C. 3841 note) is amended by 
     striking ``prices: Provided further,'' and all that follows 
     through ``Acts.'' and inserting ``prices.''.
       (h) Agricultural Water Quality Incentives Program.--Chapter 
     2 of subtitle D of title XII of the Food Security Act of 1985 
     (16 U.S.C. 3838 et seq.) is repealed.
          Subtitle E--Conservation Funding and Administration

     SEC. 341. CONSERVATION FUNDING AND ADMINISTRATION.

       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 and Administration

     ``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) Environmental Quality Incentives Program.--
       ``(1) In general.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall make available $130,000,000 
     for fiscal year 1996, and $200,000,000 for each of fiscal 
     years 1997 through 2002, for providing technical assistance, 
     cost-share payments, incentive payments, and education under 
     the environmental quality incentives program under chapter 4 
     of subtitle D.
       ``(2) Livestock production.--For each of fiscal years 1996 
     through 2002, 50 percent of the funding available for 
     technical assistance, cost-share payments, incentive 
     payments, and education under the environmental quality 
     incentives program shall be targeted at practices relating to 
     livestock production.

     ``SEC. 1242. USE OF OTHER AGENCIES.

       ``(a) Committees.--In carrying out subtitles B, C, and D, 
     the Secretary shall use the services of local, county, and 
     State committees established under section 8(b) of the Soil 
     Conservation and Domestic Allotment Act (16 U.S.C. 590h(b)).
       ``(b) Other Agencies.--
       ``(1) Use.--In carrying out subtitles C and D, the 
     Secretary may utilize the services of the Natural Resources 
     Conservation Service and the Forest Service, the Fish and 
     Wildlife Service, State forestry agencies, State fish and 
     game agencies, land-grant colleges, local, county, and State 
     committees established under section 8(b) of the Soil 
     Conservation and Domestic Allotment Act (16 U.S.C. 590h), 
     soil and water conservation districts, and other appropriate 
     agencies.
       ``(2) Consultation.--In carrying out subtitle D at the 
     State and county levels, the Secretary shall consult with, to 
     the extent practicable, the Fish and Wildlife Service, State 
     forestry agencies, State fish and game agencies, land-grant 
     colleges, soil-conservation districts, and other appropriate 
     agencies.

     ``SEC. 1243. ADMINISTRATION.

       ``(a) Plans.--The Secretary shall, to the extent 
     practicable, avoid duplication in--
       ``(1) the conservation plans required for--
       ``(A) highly erodible land conservation under subtitle B;
       ``(B) the conservation reserve program established under 
     subchapter B of chapter 1 of subtitle D; and
       ``(C) the wetlands reserve program established under 
     subchapter C of chapter 1 of subtitle D; and
       ``(2) the environmental quality incentives program 
     established under chapter 4 of subtitle D.
       ``(b) Acreage Limitation.--
       ``(1) In general.--The Secretary shall not enroll more than 
     25 percent of the cropland in any county in the programs 
     administered under the conservation reserve and wetlands 
     reserve programs established under subchapters B and C, 
     respectively, of chapter 1 of subtitle D. Not more than 10 
     percent of the cropland in a county may be subject to an 
     easement acquired under the subchapters.
       ``(2) Exception.--The Secretary may exceed the limitations 
     in paragraph (1) if the Secretary determines that--
       ``(A) the action would not adversely affect the local 
     economy of a county; and
       ``(B) operators in the county are having difficulties 
     complying with conservation plans implemented under section 
     1212.
       ``(3) Shelterbelts and windbreaks.--The limitations 
     established under this subsection shall not apply to cropland 
     that is subject to an easement under chapter 1 or 3 of 
     subtitle D that is used for the establishment of shelterbelts 
     and windbreaks.
       ``(c) Tenant Protection.--Except for a person who is a 
     tenant on land that is subject to a conservation reserve 
     contract that has been extended by the Secretary, the 
     Secretary shall provide adequate safeguards to protect the 
     interests of tenants and sharecroppers, including provision 
     for sharing, on a fair and equitable basis, in payments under 
     the programs established under subtitles B through D.
       ``(d) Provision of Technical Assistance by Other Sources.--
     In the preparation and application of a conservation 
     compliance plan under subtitle B or similar plan required as 
     a condition for assistance from the Department of 
     Agriculture, the Secretary shall permit persons to secure 
     technical assistance from approved sources, as determined by 
     the Secretary, other than the Natural Resources Conservation 
     Service. If the Secretary rejects a technical determination 
     made by such a source, the basis of the Secretary's 
     determination must be supported by documented evidence.
       ``(e) Regulations.--Not later than 90 days after the date 
     of enactment of the Federal Agriculture Improvement and 
     Reform Act of 1996, the Secretary shall issue regulations to 
     implement the conservation reserve and wetlands reserve 
     programs established under chapter 1 of subtitle D.''.

     SEC. 342. STATE TECHNICAL COMMITTEES.

       (a) Composition.--Section 1261(c) of the Food Security Act 
     of 1985 (16 U.S.C. 3861(c))--
       (1) in paragraph (7), by striking ``and'' at the end;
       (2) in paragraph (8), by striking the period at the end and 
     inserting a semicolon; and
       (3) by adding at the end the following:
       ``(9) agricultural producers with demonstrable conservation 
     expertise;
       ``(10) nonprofit organizations with demonstrable 
     conservation expertise;
       ``(11) persons knowledgeable about conservation techniques; 
     and
       ``(12) agribusiness.''.
       (b) Responsibilities.--Section 1262 of the Food Security 
     Act of 1985 (16 U.S.C. 3862) is amended--
       (1) in subsection (a), by adding at the end the following: 
     ``Each State technical committee shall provide public notice 
     of, and permit public attendance at meetings considering, 
     issues of concern related to carrying out this title.'';
       (2) in subsection (b)(1), by adding at the end the 
     following: ``Each State technical committee shall establish 
     criteria and guidelines for evaluating petitions by 
     agricultural producers regarding new conservation practices 
     and systems not already described in field office technical 
     guides.''; and
       (3) in subsection (c)--
       (A) in paragraph (7), by striking ``and'' at the end;
       (B) by redesignating paragraph (8) as paragraph (9); and
       (C) by inserting after paragraph (7) the following:
       ``(8) establishing criteria and priorities for State 
     initiatives under the environmental quality incentives 
     program under chapter 4 of subtitle D; and''.

     SEC. 343. PUBLIC NOTICE AND COMMENT FOR REVISIONS TO CERTAIN 
                   STATE TECHNICAL GUIDES.

       After the date of enactment of this Act, the Secretary of 
     Agriculture shall provide for public notice and comment under 
     section 553 of title 5, United States Code, with regard to 
     any future revisions to those provisions of the Natural 
     Resources Conservation Service State technical guides that 
     are used to carry out subtitles A, B, and C of title XII of 
     the Food Security Act of 1985 (16 U.S.C. 3801 et seq.).

[[Page H2749]]

     Subtitle F--National Natural Resources Conservation Foundation

     SEC. 351. SHORT TITLE.

       This subtitle may be cited as the ``National Natural 
     Resources Conservation Foundation Act''.

     SEC. 352. DEFINITIONS.

       In this subtitle (unless the context otherwise requires):
       (1) Board.--The term ``Board'' means the Board of Trustees 
     established under section 354.
       (2) Department.--The term ``Department'' means the 
     Department of Agriculture.
       (3) Foundation.--The term ``Foundation'' means the National 
     Natural Resources Conservation Foundation established by 
     section 353(a).
       (4) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.

     SEC. 353. NATIONAL NATURAL RESOURCES CONSERVATION FOUNDATION.

       (a) Establishment.--A National Natural Resources 
     Conservation Foundation is established as a charitable and 
     nonprofit corporation for charitable, scientific, and 
     educational purposes specified in subsection (b). The 
     Foundation is not an agency or instrumentality of the United 
     States.
       (b) Duties.--The Foundation shall--
       (1) promote innovative solutions to the problems associated 
     with the conservation of natural resources on private lands, 
     particularly with respect to agriculture and soil and water 
     conservation;
       (2) promote voluntary partnerships between government and 
     private interests in the conservation of natural resources;
       (3) conduct research and undertake educational activities, 
     conduct and support demonstration projects, and make grants 
     to State and local agencies and nonprofit organizations;
       (4) provide such other leadership and support as may be 
     necessary to address conservation challenges, such as the 
     prevention of excessive soil erosion, the enhancement of soil 
     and water quality, and the protection of wetlands, wildlife 
     habitat, and strategically important farmland subject to 
     urban conversion and fragmentation;
       (5) encourage, accept, and administer private gifts of 
     money and real and personal property for the benefit of, or 
     in connection with, the conservation and related activities 
     and services of the Department, particularly the Natural 
     Resources Conservation Service;
       (6) undertake, conduct, and encourage educational, 
     technical, and other assistance, and other activities, that 
     support the conservation and related programs administered by 
     the Department (other than activities carried out on National 
     Forest System lands), particularly the Natural Resources 
     Conservation Service, except that the Foundation may not 
     enforce or administer a regulation of the Department; and
       (7) raise private funds to promote the purposes of the 
     Foundation.
       (c) Limitations and Conflicts of Interest.--
       (1) Political activities.--The Foundation shall not 
     participate or intervene in a political campaign on behalf of 
     any candidate for public office.
       (2) Conflicts of interest.--No director, officer, or 
     employee of the Foundation shall participate, directly or 
     indirectly, in the consideration or determination of any 
     question before the Foundation affecting--
       (A) the financial interests of the director, officer, or 
     employee; or
       (B) the interests of any corporation, partnership, entity, 
     organization, or other person in which the director, officer, 
     or employee--
       (i) is an officer, director, or trustee; or
       (ii) has any direct or indirect financial interest.
       (3) Legislation or government action or policy.--No funds 
     of the Foundation may be used in any manner for the purpose 
     of influencing legislation or government action or policy.
       (4) Litigation.--No funds of the Foundation may be used to 
     bring or join an action against the United States.

     SEC. 354. COMPOSITION AND OPERATION.

       (a) Composition.--The Foundation shall be administered by a 
     Board of Trustees that shall consist of 9 voting members, 
     each of whom shall be a United States citizen and not a 
     Federal officer. The Board shall be composed of--
       (1) individuals with expertise in agricultural conservation 
     policy matters;
       (2) a representative of private sector organizations with a 
     demonstrable interest in natural resources conservation;
       (3) a representative of statewide conservation 
     organizations;
       (4) a representative of soil and water conservation 
     districts;
       (5) a representative of organizations outside the Federal 
     Government that are dedicated to natural resources 
     conservation education; and
       (6) a farmer or rancher.
       (b) Nongovernmental Employees.--Service as a member of the 
     Board shall not constitute employment by, or the holding of, 
     an office of the United States for the purposes of any 
     Federal law.
       (c) Membership.--
       (1) Initial members.--The Secretary shall appoint 9 persons 
     who meet the criteria established under subsection (a) as the 
     initial members of the Board and designate 1 of the members 
     as the initial chairperson for a 2-year term.
       (2) Terms of office.--
       (A) In general.--A member of the Board shall serve for a 
     term of 3 years, except that the members appointed to the 
     initial Board shall serve, proportionately, for terms of 1, 
     2, and 3 years, as determined by the Secretary.
       (B) Limitation on terms.--No individual may serve more than 
     2 consecutive 3-year terms as a member of the Board.
       (3) Subsequent members.--The initial members of the Board 
     shall adopt procedures in the constitution of the Foundation 
     for the nomination and selection of subsequent members of the 
     Board. The procedures shall require that each member, at a 
     minimum, meets the criteria established under subsection (a) 
     and shall provide for the selection of an individual, who is 
     not a Federal officer or a member of the Board.
       (d) Chairperson.--After the appointment of an initial 
     chairperson under subsection (c)(1), each succeeding 
     chairperson of the Board shall be elected by the members of 
     the Board for a 2-year term.
       (e) Vacancies.--A vacancy on the Board shall be filled by 
     the Board not later than 60 days after the occurrence of the 
     vacancy.
       (f) Compensation.--A member of the Board shall receive no 
     compensation from the Foundation for the service of the 
     member on the Board.
       (g) Travel Expenses.--While away from the home or regular 
     place of business of a member of the Board in the performance 
     of services for the Board, the member shall be allowed travel 
     expenses paid by the Foundation, including per diem in lieu 
     of subsistence, at the same rate as a person employed 
     intermittently in the Government service is allowed under 
     section 5703 of title 5, United States Code.

     SEC. 355. OFFICERS AND EMPLOYEES.

       (a) In General.--The Board may--
       (1) appoint, hire, and discharge the officers and employees 
     of the Foundation, other than appoint the initial Executive 
     Director of the Foundation;
       (2) adopt a constitution and bylaws for the Foundation that 
     are consistent with the purposes of this subtitle; and
       (3) undertake any other activities that may be necessary to 
     carry out this subtitle.
       (b) Officers and Employees.--
       (1) Appointment and hiring.--An officer or employee of the 
     Foundation--
       (A) shall not, by virtue of the appointment or employment 
     of the officer or employee, be considered a Federal employee 
     for any purpose, including the provisions of title 5, United 
     States Code, governing appointments in the competitive 
     service, except that such an individual may participate in 
     the Federal employee retirement system as if the individual 
     were a Federal employee; and
       (B) may not be paid by the Foundation a salary in excess of 
     $125,000 per year.
       (2) Executive director.--
       (A) Initial director.--The Secretary shall appoint an 
     individual to serve as the initial Executive Director of the 
     Foundation who shall serve, at the direction of the Board, as 
     the chief operating officer of the Foundation.
       (B) Subsequent directors.--The Board shall appoint each 
     subsequent Executive Director of the Foundation who shall 
     serve, at the direction of the Board, as the chief operating 
     officer of the Foundation.
       (C) Qualifications.--The Executive Director shall be 
     knowledgeable and experienced in matters relating to natural 
     resources conservation.

     SEC. 356. CORPORATE POWERS AND OBLIGATIONS OF THE FOUNDATION.

       (a) In General.--The Foundation--
       (1) may conduct business throughout the United States and 
     the territories and possessions of the United States; and
       (2) shall at all times maintain a designated agent who is 
     authorized to accept service of process for the Foundation, 
     so that the serving of notice to, or service of process on, 
     the agent, or mailed to the business address of the agent, 
     shall be considered as service on or notice to the 
     Foundation.
       (b) Seal.--The Foundation shall have an official seal 
     selected by the Board that shall be judicially noticed.
       (c) Powers.--To carry out the purposes of the Foundation 
     under section 353(b), the Foundation shall have, in addition 
     to the powers otherwise provided under this subtitle, the 
     usual powers of a corporation, including the power--
       (1) to accept, receive, solicit, hold, administer, and use 
     any gift, devise, or bequest, either absolutely or in trust, 
     of real or personal property or any income from, or other 
     interest in, the gift, devise, or bequest;
       (2) to acquire by purchase or exchange any real or personal 
     property or interest in property, except that funds provided 
     under section 360 may not be used to purchase an interest in 
     real property;
       (3) unless otherwise required by instrument of transfer, to 
     sell, donate, lease, invest, reinvest, retain, or otherwise 
     dispose of any property or income from property;
       (4) to borrow money from private sources and issue bonds, 
     debentures, or other debt instruments, subject to section 
     359, except that the aggregate amount of the borrowing and 
     debt instruments outstanding at any time may not exceed 
     $1,000,000;
       (5) to sue and be sued, and complain and defend itself, in 
     any court of competent jurisdiction, except that a member of 
     the Board shall not be personally liable for an action in the 
     performance of services for the Board, except for gross 
     negligence;
       (6) to enter into a contract or other agreement with an 
     agency of State or local government, educational institution, 
     or other private organization or person and to make such 
     payments as may be necessary to carry out the functions of 
     the Foundation; and
       (7) to do any and all acts that are necessary to carry out 
     the purposes of the Foundation.
       (d) Interests in Property.--
       (1) Interests in real property.--The Foundation may 
     acquire, hold, and dispose of lands, waters, or other 
     interests in real property by donation, gift, devise, 
     purchase, or exchange. An interest in real property shall be 
     treated, among other things, as including an easement or 
     other right for the preservation, conservation, protection, 
     or enhancement of agricultural, natural, scenic, historic, 
     scientific, educational, inspirational, or recreational 
     resources.

[[Page H2750]]

       (2) Gifts.--A gift, devise, or bequest may be accepted by 
     the Foundation even though the gift, devise, or bequest is 
     encumbered, restricted, or subject to a beneficial interest 
     of a private person if any current or future interest in the 
     gift, devise, or bequest is for the benefit of the 
     Foundation.

     SEC. 357. ADMINISTRATIVE SERVICES AND SUPPORT.

       For each of fiscal years 1996 through 1998, the Secretary 
     may provide, without reimbursement, personnel, facilities, 
     and other administrative services of the Department to the 
     Foundation.

     SEC. 358. AUDITS AND PETITION OF ATTORNEY GENERAL FOR 
                   EQUITABLE RELIEF.

       (a) Audits.--
       (1) In general.--The accounts of the Foundation shall be 
     audited in accordance with Public Law 88-504 (36 U.S.C. 1101 
     et seq.), including an audit of lobbying and litigation 
     activities carried out by the Foundation.
       (2) Conforming amendment.--The first section of Public Law 
     88-504 (36 U.S.C. 1101) is amended by adding at the end the 
     following:
       ``(77) The National Natural Resources Conservation 
     Foundation.''.
       (b) Relief With Respect to Certain Foundation Acts or 
     Failure To Act.--The Attorney General may petition in the 
     United States District Court for the District of Columbia for 
     such equitable relief as may be necessary or appropriate, if 
     the Foundation--
       (1) engages in, or threatens to engage in, any act, 
     practice, or policy that is inconsistent with this subtitle; 
     or
       (2) refuses, fails, neglects, or threatens to refuse, fail, 
     or neglect, to discharge the obligations of the Foundation 
     under this subtitle.

     SEC. 359. RELEASE FROM LIABILITY.

       (a) In General.--The United States shall not be liable for 
     any debt, default, act, or omission of the Foundation. The 
     full faith and credit of the United States shall not extend 
     to the Foundation.
       (b) Statement.--An obligation issued by the Foundation, and 
     a document offering an obligation, shall include a prominent 
     statement that the obligation is not directly or indirectly 
     guaranteed, in whole or in part, by the United States (or an 
     agency or instrumentality of the United States).

     SEC. 360. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated to the Department 
     to be made available to the Foundation $1,000,000 for each of 
     fiscal years 1997 through 1999 to initially establish and 
     carry out activities of the Foundation.
                          Subtitle G--Forestry

     SEC. 371. OFFICE OF INTERNATIONAL FORESTRY.

       Section 2405 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 6704) is amended by adding at the 
     end the following:
       ``(d) Authorization of Appropriations.--There are 
     authorized to be appropriated for each of fiscal years 1996 
     through 2002 such sums as are necessary to carry out this 
     section.''.

     SEC. 372. COOPERATIVE WORK FOR PROTECTION, MANAGEMENT, AND 
                   IMPROVEMENT OF NATIONAL FOREST SYSTEM.

       The penultimate paragraph of the matter under the heading 
     ``FOREST SERVICE.'' of the first section of the Act of June 
     30, 1914 (38 Stat. 430, chapter 131; 16 U.S.C. 498), is 
     amended--
       (1) by inserting ``, management,'' after ``the 
     protection'';
       (2) by striking ``national forests,'' and inserting 
     ``National Forest System,'';
       (3) by inserting ``management,'' after ``protection,'' both 
     places it appears; and
       (4) by adding at the end the following: ``Payment for work 
     undertaken pursuant to this paragraph may be made from any 
     appropriation of the Forest Service that is available for 
     similar work if a written agreement so provides and 
     reimbursement will be provided by a cooperator in the same 
     fiscal year as the expenditure by the Forest Service. A 
     reimbursement received from a cooperator that covers the 
     proportionate share of the cooperator of the cost of the work 
     shall be deposited to the credit of the appropriation of the 
     Forest Service from which the payment was initially made or, 
     if the appropriation is no longer available, to the credit of 
     an appropriation of the Forest Service that is available for 
     similar work. The Secretary of Agriculture shall establish 
     written rules that establish criteria to be used to determine 
     whether the acceptance of contributions of money under this 
     paragraph would adversely affect the ability of an officer or 
     employee of the Department of Agriculture to carry out a duty 
     or program of the officer or employee in a fair and objective 
     manner or would compromise, or appear to compromise, the 
     integrity of the program, officer, or employee. The Secretary 
     of Agriculture shall establish written rules that protect the 
     interests of the Forest Service in cooperative work 
     agreements.''.

     SEC. 373. FORESTRY INCENTIVES PROGRAM.

       Section 4 of the Cooperative Forestry Assistance Act of 
     1978 (16 U.S.C. 2103) is amended--
       (1) in subsection (j), by striking ``annually'' and 
     inserting ``for each of fiscal years 1996 through 2002''; and
       (2) by striking subsection (k).

     SEC. 374. OPTIONAL STATE GRANTS FOR FOREST LEGACY PROGRAM.

       Section 7 of the Cooperative Forestry Assistance Act of 
     1978 (16 U.S.C. 2103c) is amended--
       (1) by redesignating subsection (l) as subsection (m); and
       (2) by inserting after subsection (k) the following:
       ``(l) Optional State Grants.--
       ``(1) In general.--The Secretary shall, at the request of a 
     participating State, provide a grant to the State to carry 
     out the Forest Legacy Program in the State.
       ``(2) Administration.--If a State elects to receive a grant 
     under this subsection--
       ``(A) the Secretary shall use a portion of the funds made 
     available under subsection (m), as determined by the 
     Secretary, to provide a grant to the State; and
       ``(B) the State shall use the grant to carry out the Forest 
     Legacy Program in the State, including the acquisition by the 
     State of lands and interests in lands.''.
           Subtitle H--Miscellaneous Conservation Provisions

     SEC. 381. CONSERVATION ACTIVITIES OF COMMODITY CREDIT 
                   CORPORATION.

       (a) In General.--Section 5 of the Commodity Credit 
     Corporation Charter Act (15 U.S.C. 714c) is amended--
       (1) by redesignating subsection (g) as subsection (h); and
       (2) by inserting after subsection (f) the following:
       ``(g) Carry out conservation or environmental programs 
     authorized by law.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall become effective on January 1, 1997.

     SEC. 382. FLOODPLAIN EASEMENTS.

       Section 403 of the Agricultural Credit Act of 1978 (16 
     U.S.C. 2203) is amended by inserting ``, including the 
     purchase of floodplain easements,'' after ``emergency 
     measures''.

     SEC. 383. RESOURCE CONSERVATION AND DEVELOPMENT PROGRAM.

       Section 1538 of the Agriculture and Food Act of 1981 (16 
     U.S.C. 3461) is amended by striking ``1991 through 1995'' and 
     inserting ``1996 through 2002''.

     SEC. 384. REPEAL OF REPORT REQUIREMENT.

       Section 1342 of title 44, United States Code, is repealed.

     SEC. 385. FLOOD RISK REDUCTION.

       (a) In General.--During fiscal years 1996 through 2002, the 
     Secretary of Agriculture (referred to in this section as the 
     ``Secretary'') may enter into a contract with a producer on a 
     farm who has contract acreage under the Agricultural Market 
     Transition Act that is frequently flooded.
       (b) Duties of Producers.--Under the terms of the contract, 
     with respect to acres that are subject to the contract, the 
     producer must agree to--
       (1) the termination of any contract acreage and production 
     flexibility contract under the Agricultural Market Transition 
     Act;
       (2) forgo loans for contract commodities, oilseeds, and 
     extra long staple cotton;
       (3) not apply for crop insurance issued or reinsured by the 
     Secretary;
       (4) comply with applicable highly erodible land and 
     wetlands conservation compliance requirements established 
     under title XII of the Food Security Act of 1985 (16 U.S.C. 
     3801 et seq.);
       (5) not apply for any conservation program payments from 
     the Secretary;
       (6) not apply for disaster program benefits provided by the 
     Secretary; and
       (7) refund the payments, with interest, issued under the 
     flood risk reduction contract to the Secretary, if the 
     producer violates the terms of the contract or if the 
     producer transfers the property to another person who 
     violates the contract.
       (c) Duties of the Secretary.--In return for a contract 
     entered into by a producer under this section, the Secretary 
     shall pay the producer an amount that is not more than 95 
     percent of projected contract payments under the Agricultural 
     Market Transition Act that the Secretary estimates the 
     producer would otherwise have received during the period 
     beginning at the time the contract is entered into under this 
     section and ending September 30, 2002.
       (d) Commodity Credit Corporation.--The Secretary shall 
     carry out the program authorized by this section (other than 
     subsection (e)) through the Commodity Credit Corporation.
       (e) Additional Payments.--
       (1) In general.--Subject to the availability of advanced 
     appropriations, the Secretary may make payments to a producer 
     described in subsection (a), in addition to the payments 
     provided under subsection (c), to offset other estimated 
     Federal Government outlays on frequently flooded land.
       (2) Authorization of appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     paragraph (1).
       (f) Limitation on Payments.--Amounts made available for 
     production flexibility contracts under section 113 shall be 
     reduced by an amount that is equal to the contract payments 
     that producers forgo under subsection (b)(1) of this section.

     SEC. 386. CONSERVATION OF PRIVATE GRAZING LAND.

       (a) Findings.--Congress finds that--
       (1) private grazing land constitutes nearly \1/2\ of the 
     non-Federal land of the United States and is basic to the 
     environmental, social, and economic stability of rural 
     communities;
       (2) private grazing land contains a complex set of 
     interactions among soil, water, air, plants, and animals;
       (3) grazing land constitutes the single largest watershed 
     cover type in the United States and contributes significantly 
     to the quality and quantity of water available for all of the 
     many uses of the land;
       (4) private grazing land constitutes the most extensive 
     wildlife habitat in the United States;
       (5) private grazing land can provide opportunities for 
     improved nutrient management from land application of animal 
     manures and other by-product nutrient resources;
       (6) owners and managers of private grazing land need to 
     continue to recognize conservation problems when the problems 
     arise and receive sound technical assistance to improve or 
     conserve grazing land resources to meet ecological and 
     economic demands;

[[Page H2751]]

       (7) new science and technology must continually be made 
     available in a practical manner so owners and managers of 
     private grazing land may make informed decisions concerning 
     vital grazing land resources;
       (8) agencies of the Department with private grazing land 
     responsibilities are the agencies that have the expertise and 
     experience to provide technical assistance, education, and 
     research to owners and managers of private grazing land for 
     the long-term productivity and ecological health of grazing 
     land;
       (9) although competing demands on private grazing land 
     resources are greater than ever before, assistance to private 
     owners and managers of private grazing land is currently 
     limited and does not meet the demand and basic need for 
     adequately sustaining or enhancing the private grazing land 
     resources; and
       (10) private grazing land can be enhanced to provide many 
     benefits to all citizens of the United States through 
     voluntary cooperation among owners and managers of the land, 
     local conservation districts, and the agencies of the 
     Department responsible for providing assistance to owners and 
     managers of land and to conservation districts.
       (b) Purpose.--It is the purpose of this section to 
     authorize the Secretary to provide a coordinated technical, 
     educational, and related assistance program to conserve and 
     enhance private grazing land resources and provide related 
     benefits to all citizens of the United States by--
       (1) establishing a coordinated and cooperative Federal, 
     State, and local grazing conservation program for management 
     of private grazing land;
       (2) strengthening technical, educational, and related 
     assistance programs that provide assistance to owners and 
     managers of private grazing land;
       (3) conserving and improving wildlife habitat on private 
     grazing land;
       (4) conserving and improving fish habitat and aquatic 
     systems through grazing land conservation treatment;
       (5) protecting and improving water quality;
       (6) improving the dependability and consistency of water 
     supplies;
       (7) identifying and managing weed, noxious weed, and brush 
     encroachment problems on private grazing land; and
       (8) integrating conservation planning and management 
     decisions by owners and managers of private grazing land, on 
     a voluntary basis.
       (c) Definitions.--In this section:
       (1) Department.--The term ``Department'' means the 
     Department of Agriculture.
       (2) Private grazing land.--The term ``private grazing 
     land'' means private, State-owned, tribally-owned, and any 
     other non-federally owned rangeland, pastureland, grazed 
     forest land, and hay land.
       (3) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (d) Private Grazing Land Conservation Assistance.--
       (1) Assistance to grazing landowners and others.--Subject 
     to the availability of appropriations for this section, the 
     Secretary shall establish a voluntary program to provide 
     technical, educational, and related assistance to owners and 
     managers of private grazing land and public agencies, through 
     local conservation districts, to enable the landowners, 
     managers, and public agencies to voluntarily carry out 
     activities that are consistent with this section, including--
       (A) maintaining and improving private grazing land and the 
     multiple values and uses that depend on private grazing land;
       (B) implementing grazing land management technologies;
       (C) managing resources on private grazing land, including--
       (i) planning, managing, and treating private grazing land 
     resources;
       (ii) ensuring the long-term sustainability of private 
     grazing land resources;
       (iii) harvesting, processing, and marketing private grazing 
     land resources; and
       (iv) identifying and managing weed, noxious weed, and brush 
     encroachment problems;
       (D) protecting and improving the quality and quantity of 
     water yields from private grazing land;
       (E) maintaining and improving wildlife and fish habitat on 
     private grazing land;
       (F) enhancing recreational opportunities on private grazing 
     land;
       (G) maintaining and improving the aesthetic character of 
     private grazing lands; and
       (H) identifying the opportunities and encouraging the 
     diversification of private grazing land enterprises.
       (2) Program elements.--
       (A) Funding.--If funding is provided to carry out this 
     section, it shall be provided through a specific line-item in 
     the annual appropriations for the Natural Resources 
     Conservation Service.
       (B) Technical assistance and education.--Personnel of the 
     Department trained in pasture and range management shall be 
     made available under the program to deliver and coordinate 
     technical assistance and education to owners and managers of 
     private grazing land, at the request of the owners and 
     managers.
       (e) Grazing Technical Assistance Self-Help.--
       (1) Findings.--Congress finds that--
       (A) there is a severe lack of technical assistance for 
     farmers and ranchers who graze livestock;
       (B) Federal budgetary constraints preclude any significant 
     expansion, and may force a reduction of, current levels of 
     technical support; and
       (C) farmers and ranchers have a history of cooperatively 
     working together to address common needs in the promotion of 
     their products and in the drainage of wet areas through 
     drainage districts.
       (2) Establishment of grazing demonstration.--In accordance 
     with paragraph (3), the Secretary may establish 2 grazing 
     management demonstration districts at the recommendation of 
     the grazing lands conservation initiative steering committee.
       (3) Procedure.--
       (A) Proposal.--Within a reasonable time after the 
     submission of a request of an organization of farmers or 
     ranchers engaged in grazing, the Secretary shall propose that 
     a grazing management district be established.
       (B) Funding.--The terms and conditions of the funding and 
     operation of the grazing management district shall be 
     proposed by the producers.
       (C) Approval.--The Secretary shall approve the proposal if 
     the Secretary determines that the proposal--
       (i) is reasonable;
       (ii) will promote sound grazing practices; and
       (iii) contains provisions similar to the provisions 
     contained in the beef promotion and research order issued 
     under section 4 of the Beef Research and Information Act (7 
     U.S.C. 2903) in effect on the date of enactment of this Act.
       (D) Area included.--The area proposed to be included in a 
     grazing management district shall be determined by the 
     Secretary on the basis of a petition by farmers or ranchers.
       (E) Authorization.--The Secretary may use authority under 
     the Agricultural Adjustment Act (7 U.S.C. 601 et seq.), 
     reenacted with amendments by the Agricultural Marketing 
     Agreement Act of 1937, to operate, on a demonstration basis, 
     a grazing management district.
       (F) Activities.--The activities of a grazing management 
     district shall be scientifically sound activities, as 
     determined by the Secretary in consultation with a technical 
     advisory committee composed of ranchers, farmers, and 
     technical experts.
       (f) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section--
       (1) $20,000,000 for fiscal year 1996;
       (2) $40,000,000 for fiscal year 1997; and
       (3) $60,000,000 for fiscal year 1998 and each subsequent 
     fiscal year.

     SEC. 387. WILDLIFE HABITAT INCENTIVES PROGRAM.

       (a) In General.--The Secretary of Agriculture, in 
     consultation with the State technical committees established 
     under section 1261 of the Food Security Act of 1985 (16 
     U.S.C. 3861), shall establish a program under the Natural 
     Resources Conservation Service to be known as the ``Wildlife 
     Habitat Incentive Program''.
       (b) Cost-Share Payments.--Under the program, the Secretary 
     shall make cost-share payments to landowners to develop 
     upland wildlife, wetland wildlife, threatened and endangered 
     species, fish, and other types of wildlife habitat approved 
     by the Secretary.
       (c) Funding.--To carry out this section, a total of 
     $50,000,000 shall be made available for fiscal years 1996 
     through 2002 from funds made available to carry out 
     subchapter B of chapter 1 of subtitle D of title XII of the 
     Food Security Act of 1985 (16 U.S.C. 3831 et seq.).

     SEC. 388. FARMLAND PROTECTION PROGRAM.

       (a) In General.--The Secretary of Agriculture shall 
     establish and carry out a farmland protection program under 
     which the Secretary shall purchase conservation easements or 
     other interests in not less than 170,000, nor more than 
     340,000, acres of land with prime, unique, or other 
     productive soil that is subject to a pending offer from a 
     State or local government for the purpose of protecting 
     topsoil by limiting nonagricultural uses of the land.
       (b) Conservation Plan.--Any highly erodible cropland for 
     which a conservation easement or other interest is purchased 
     under this section shall be subject to the requirements of a 
     conservation plan that requires, at the option of the 
     Secretary, the conversion of the cropland to less intensive 
     uses.
       (c) Funding.--The Secretary shall use not more than 
     $35,000,000 of the funds of the Commodity Credit Corporation 
     to carry out this section.

     SEC. 389. INTERIM MORATORIUM ON BYPASS FLOWS.

       (a) Moratorium.--There shall be an 18-month moratorium on 
     any Forest Service decision to require bypass flows or any 
     other relinquishment of the unimpaired use of a decreed water 
     right as a condition of renewal or reissuance of a land use 
     authorization permit.
       (b) Limitations.--Subsection (a) shall not affect--
       (1) obligations or authority of the Secretary of 
     Agriculture to protect public health and safety; and
       (2) obligations or authority under the Endangered Species 
     Act of 1973 (16 U.S.C. 1531 et seq.), or applicable State 
     law.
       (c) Rules of Construction.--
       (1) Existing non-federal water rights.--Nothing in this 
     section prevents or inhibits the exercise of the use and 
     operation of existing non-Federal water rights on or above 
     the National Forest land that require land use authorization 
     permits from the Forest Service to access water supply 
     facilities.
       (2) Renewal or reissuance of expiring land use 
     authorization for decreed water rights.--Nothing in this 
     section prevents or inhibits the renewal or reissuance of 
     expiring land use authorizations for decreed water rights. 
     The Forest Service may extend, as needed, any expiring land 
     use authorization for such time as is necessary to 
     incorporate the results of the study authorized by subsection 
     (d).
       (d) Study of Water Rights Across Federal Lands.--
       (1) Establishment.--Not later than 60 days after the date 
     of enactment of this Act, there shall be established a Water 
     Rights Task Force to study the subjects described in 
     paragraph (3).
       (2) Membership.--The Task Force shall be composed of 7 
     members appointed as follows:

[[Page H2752]]

       (A) 1 member shall be appointed by the Secretary of 
     Agriculture.
       (B) 2 members shall be appointed by the Speaker of the 
     House of Representatives and 1 member shall be appointed by 
     the Minority Leader of the House of Representatives.
       (C) 2 members shall be appointed by the Majority Leader of 
     the Senate and 1 member shall be appointed by the Minority 
     Leader of the Senate.
       (3) Subjects to be studied.--The Task Force shall study and 
     make recommendations on--
       (A) whether Federal water rights should be acquired for 
     environmental protection on National Forest land;
       (B) measures necessary to protect the free exercise of non-
     Federal water rights requiring easements and permits from the 
     Forest Service;
       (C) the protection of minimum instream flows for 
     environmental and watershed management purposes on National 
     Forest land through purchases or exchanges from willing 
     sellers in accordance with State law;
       (D) the effects of any of the recommendations made under 
     this paragraph on existing State laws, regulations, and 
     customs of water usage; and
       (E) measures that would be useful in avoiding or resolving 
     conflicts between the Forest Service's responsibilities for 
     natural resource and environmental protection, the public 
     interest, and the property rights and interests of water 
     holders with special use permits for water facilities, 
     including the study of the Federal acquisition of water 
     rights, dispute resolution, mitigation, and compensation.
       (4) Final report.--As soon as practicable, but not later 
     than 1 year, after the date of enactment of this Act, the 
     Task Force shall provide the final report of the Task Force 
     to--
       (A) the Secretary of Agriculture;
       (B) the Speaker of the House of Representatives;
       (C) the President pro tempore of the Senate;
       (D) the Chairman of the Committee on Agriculture of the 
     House of Representatives;
       (E) the Chairman of the Committee on Agriculture, 
     Nutrition, and Forestry of the Senate;
       (F) the Chairman of the Committee on Resources of the House 
     of Representatives; and
       (G) the Chairman of the Committee on Energy and Natural 
     Resources of the Senate.
       (5) Authorization of funds.--The Secretary of Agriculture 
     shall use funds made available for salaries and 
     administrative expenses of the Department of Agriculture to 
     carry out this subsection.

     SEC. 390. EVERGLADES ECOSYSTEM RESTORATION.

       (a) In General.--On July 1, 1996, out of any funds in the 
     Treasury not otherwise appropriated, the Secretary of the 
     Treasury shall provide $200,000,000 to the Secretary of the 
     Interior to carry out this section.
       (b) Entitlement.--The Secretary of the Interior (referred 
     to in this section as the ``Secretary'')--
       (1) shall be entitled to receive the funds made available 
     under subsection (a);
       (2) shall accept the funds; and
       (3) shall use the funds to--
       (A) conduct restoration activities in the Everglades 
     ecosystem in South Florida, which shall include the 
     acquisition of real property and interests in real property 
     located within the Everglades ecosystem; and
       (B) fund resource protection and resource maintenance 
     activities in the Everglades ecosystem.
       (c) Savings Provision.--Nothing in this subsection 
     precludes the Secretary from transferring funds to the Army 
     Corps of Engineers, the State of Florida, or the South 
     Florida Water Management District to carry out subsection 
     (b)(3).
       (d) Deadline.--The Secretary shall use the funds made 
     available under subsection (a) for restoration activities 
     referred to in subsection (b)(3) not later than December 31, 
     1999.
       (e) Report to Congress.--For each of calendar years 1996 
     through 1999, the Secretary shall submit an annual report to 
     Congress describing all activities carried out under 
     subsection (b)(3).
       (f) Separate and Additional Everglades Restoration 
     Account.--
       (1) Establishment.--There is established in the Treasury a 
     special account (to be known as the ``Everglades Restoration 
     Account''), which shall consist of such funds as may be 
     deposited in the account under paragraph (2). The account 
     shall be separate, and in addition to, funds deposited in the 
     Treasury under subsection (a).
       (2) Source of funds for account.--
       (A) Proceeds from surplus property.--
       (i) In general.--Subject to subparagraph (B), the 
     Administrator shall deposit in the special account all funds 
     received by the Administrator, on or after the date of 
     enactment of this Act, from the disposal pursuant to the 
     Federal Property and Administrative Services Act of 1949 (40 
     U.S.C. 471 et seq.) of surplus real property located in the 
     State of Florida.
       (ii) Availability and disposition of federal land.--

       (I) Identification.--Any Federal real property located in 
     the State of Florida (excluding lands under the 
     administrative jurisdiction of the Secretary that are set 
     aside for conservation purposes) shall be identified for 
     disposal or exchange under this subsection and shall be 
     presumed available for purposes of this subsection unless the 
     head of the agency controlling the property determines that 
     there is a compelling program need for any property 
     identified by the Secretary.
       (II) Availability.--Property identified by the Secretary 
     for which there is no demonstrated compelling program need 
     shall, not later than 90 days after a request by the 
     Secretary, be reported to the Administrator and shall be made 
     available to the Administrator who shall consider the 
     property to be surplus property for purposes of the Federal 
     Property and Administrative Services Act of 1949 (40 U.S.C 
     471 et. seq.).
       (III) Prioritization of disposition.--The Administrator may 
     prioritize the disposition of property made available under 
     this subparagraph to permit the property to be sold as 
     quickly as practicable in a manner that is consistent with 
     the best interests of the Federal Government.

       (B) Limit on total amount of deposits.--The total amount of 
     funds deposited in the special account under subparagraph (A) 
     shall not exceed $100,000,000.
       (C) Effect on closure of military installations.--Nothing 
     in this section alters the disposition of any proceeds 
     arising from the disposal of real property pursuant to a base 
     closure law.
       (3) Use of special account.--Funds in the special account 
     shall be available to the Secretary until expended under this 
     paragraph. The Secretary shall use funds in the special 
     account to assist in the restoration of the Everglades 
     ecosystem in South Florida through--
       (A) subject to paragraph (4), the acquisition of real 
     property and interests in real property located within the 
     Everglades ecosystem; and
       (B) the funding of resource protection and resource 
     maintenance activities in the Everglades ecosystem.
       (4) State contribution.--The Secretary may not expend any 
     funds from the special account to acquire a parcel of real 
     property, or an interest in a parcel of real property, under 
     paragraph (3)(A) unless the Secretary obtains, or has 
     previously obtained, a contribution from the State of Florida 
     in an amount equal to not less than 50 percent of the 
     appraised value of the parcel or interest to be acquired, as 
     determined by the Secretary.
       (5) Definitions.--In this subsection:
       (A) Administrator.--The term ``Administrator'' means the 
     Administrator of General Services.
       (B) Base closure law.--The term ``base closure law'' means 
     each of the following:
       (i) The Defense Base Closure and Realignment Act of 1990 
     (part A of title XXIX of Public Law 101-510; 10 U.S.C. 2687 
     note).
       (ii) Title II of the Defense Authorization Amendments and 
     Base Closure and Realignment Act (Public Law 100-526; 10 
     U.S.C. 2687 note).
       (iii) Section 2687 of title 10, United States Code.
       (iv) Any other similar law enacted after the date of 
     enactment of this Act.
       (C) Everglades ecosystem.--The term ``Everglades 
     ecosystem'' means the Florida Everglades Restoration area 
     that extends from the Kissimmee River basin to Florida Bay.
       (D) Excess property.--The term ``excess property'' has the 
     meaning provided in section 3 of the Federal Property and 
     Administrative Services Act of 1949 (40 U.S.C. 472).
       (E) Executive agency.--The term ``executive agency'' has 
     the meaning provided in section 3 of the Federal Property and 
     Administrative Services Act of 1949 (40 U.S.C. 472).
       (F) Special account.--The term ``special account'' means 
     the Everglades Restoration Account established under 
     paragraph (1).
       (G) Surplus property.--The term ``surplus property'' has 
     the meaning provided in section 3 of the Federal Property and 
     Administrative Services Act of 1949 (40 U.S.C. 472).
       (g) Report To Determine the Feasibility of Additional Land 
     Acquisition and Restoration Activities.--
       (1) In general.--The Secretary shall conduct an 
     investigation to determine what, if any, unreserved and 
     unappropriated Federal lands (or mineral interests in any 
     such lands) under the administrative jurisdiction of the 
     Secretary are suitable for disposal or exchange for the 
     purpose of conducting restoration activities in the 
     Everglades region.
       (2) Conservation lands.--No lands under the administrative 
     jurisdiction of the Secretary that are set aside for 
     conservation purposes shall be identified for disposal or 
     exchange under this subsection.
       (3) Florida.--In carrying out this subsection, the 
     Secretary shall, to the maximum extent practicable, determine 
     which lands and mineral interests located within the State of 
     Florida are suitable for disposal or exchange before making 
     the determination for eligible lands or interests in other 
     States.
       (4) Public access.--In carrying out this subsection, the 
     Secretary shall consider that in disposing of lands, the 
     Secretary shall retain such interest in the lands as may be 
     necessary to ensure that the general public is not precluded 
     from reasonable access to the lands for purposes of fishing, 
     hunting, or other recreational uses.
       (5) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall submit a report to 
     the Committee on Resources of the House of Representatives 
     and the Committee on Energy and Natural Resources of the 
     Senate describing the results of the investigation conducted 
     under this subsection. The report shall describe the specific 
     parcels identified under this subsection, establish the 
     priorities for disposal or exchange among the parcels, and 
     estimate the values of the parcels.

     SEC. 391. AGRICULTURAL AIR QUALITY RESEARCH OVERSIGHT.

       (a) Findings.--Congress finds that--
       (1) various studies have alleged that agriculture is a 
     source of PM-10 emissions;
       (2) many of these studies have often been based on 
     erroneous data;
       (3) Federal research activities are currently being 
     conducted by the Department of Agriculture to determine the 
     true extent to which agricultural activities contribute to 
     air pollution and to determine cost-effective ways in which 
     the agricultural industry can reduce any pollution that 
     exists; and

[[Page H2753]]

       (4) any Federal policy recommendations that may be issued 
     by any Federal agency to address air pollution problems 
     related to agriculture or any other industrial activity 
     should be based on sound scientific findings that are subject 
     to adequate peer review and should take into account economic 
     feasibility.
       (b) Purpose.--The purpose of this section is to encourage 
     the Secretary of Agriculture to continue to strengthen vital 
     research efforts related to agricultural air quality.
       (c) Oversight Coordination.--
       (1) Intergovernmental cooperation.--The Secretary shall, to 
     the maximum extent practicable with respect to the Department 
     of Agriculture and other Federal departments and agencies, 
     ensure intergovernmental cooperation in research activities 
     related to agricultural air quality and avoid duplication of 
     the activities.
       (2) Correct data.--The Secretary shall, to the maximum 
     extent practicable, ensure that the results of any research 
     related to agricultural air quality conducted by Federal 
     agencies not report erroneous data with respect to 
     agricultural air quality.
       (d) Task Force.--
       (1) Establishment.--The Chief of the National Resources 
     Conservation Service shall establish a task force to address 
     agricultural air quality issues.
       (2) Composition.--The task force shall be comprised of 
     employees of the Department of Agriculture, industry 
     representatives, and other experts in the fields of 
     agriculture and air quality.
       (3) Duties.--The task force shall advise the Secretary with 
     respect to the role of the Secretary for providing oversight 
     and coordination related to agricultural air quality.
                     TITLE IV--NUTRITION ASSISTANCE

     SEC. 401. FOOD STAMP PROGRAM.

       (a) Disqualification of a Store or Concern.--Section 
     12(b)(3)(B) of the Food Stamp Act of 1977 (7 U.S.C. 
     2021(b)(3)(B)) is amended--
       (1) by striking the second parenthetical; and
       (2) by striking ``; or'' and inserting the following: ``, 
     including evidence that--
       ``(i) the ownership of the store or food concern was not 
     aware of, did not approve of, did not benefit from, and was 
     not involved in the conduct of the violation; and
       ``(ii)(I) the management of the store or food concern was 
     not aware of, did not approve of, did not benefit from, and 
     was not involved in the conduct of the violation; or
       ``(II) the management was aware of, approved of, benefited 
     from, or was involved in the conduct of no more than 1 
     previous violation by the store or food concern; or''.
       (b) Employment and Training.--Section 16(h)(1) of the Food 
     Stamp Act of 1977 (7 U.S.C. 2025(h)(1)) is amended by 
     striking ``1995'' each place it appears and inserting 
     ``2002''.
       (c) Authorization of Pilot Projects.--The last sentence of 
     section 17(b)(1)(A) of the Food Stamp Act of 1977 (7 U.S.C. 
     2026(b)(1)(A)) is amended by striking ``1995'' and inserting 
     ``2002''.
       (d) Outreach Demonstration Projects.--The first sentence of 
     section 17(j)(1)(A) of the Food Stamp Act of 1977 (7 U.S.C. 
     2026(j)(1)(A)) is amended by striking ``1995'' and inserting 
     ``2002''.
       (e) Authorization for Appropriations.--The first sentence 
     of section 18(a)(1) of the Food Stamp Act of 1977 (7 U.S.C. 
     2027(a)(1)) is amended by striking ``1995'' and inserting 
     ``1997''.
       (f) Reauthorization of Puerto Rico Nutrition Assistance 
     Program.--The first sentence of section 19(a)(1)(A) of the 
     Food Stamp Act of 1977 (7 U.S.C. 2028(a)(1)(A)) is amended by 
     striking ``$974,000,000'' and all that follows through 
     ``fiscal year 1995'' and inserting ``$1,143,000,000 for 
     fiscal year 1996, $1,174,000,000 for fiscal year 1997, 
     $1,204,000,000 for fiscal year 1998, $1,236,000,000 for 
     fiscal year 1999, $1,268,000,000 for fiscal year 2000, 
     $1,301,000,000 for fiscal year 2001, and $1,335,000,000 for 
     fiscal year 2002''.
       (g) American Samoa.--The Food Stamp Act of 1977 (7 U.S.C. 
     2011 et seq.) is amended by adding at the end the following:

     ``SEC. 24. TERRITORY OF AMERICAN SAMOA.

       ``Effective October 1, 1995, from amounts made available to 
     carry out this Act, the Secretary shall pay to the Territory 
     of American Samoa not more than $5,300,000 for each of fiscal 
     years 1996 through 2002 to finance 100 percent of the 
     expenditures for the fiscal year for a nutrition assistance 
     program extended under section 601(c) of Public Law 96-597 
     (48 U.S.C. 1469d(c)).''.
       (h) Assistance for Community Food Projects.--The Food Stamp 
     Act of 1977 (7 U.S.C. 2011 et seq.) (as amended by subsection 
     (g)) is amended by adding at the end the following:

     ``SEC. 25. ASSISTANCE FOR COMMUNITY FOOD PROJECTS.

       ``(a) Definition of Community Food Projects.--In this 
     section, the term `community food project' means a community-
     based project that requires a 1-time infusion of Federal 
     assistance to become self-sustaining and that is designed 
     to--
       ``(1) meet the food needs of low-income people;
       ``(2) increase the self-reliance of communities in 
     providing for their own food needs; and
       ``(3) promote comprehensive responses to local food, farm, 
     and nutrition issues.
       ``(b) Authority To Provide Assistance.--
       ``(1) In general.--From amounts made available to carry out 
     this Act, the Secretary may make grants to assist eligible 
     private nonprofit entities to establish and carry out 
     community food projects.
       ``(2) Limitation on grants.--The total amount of funds 
     provided as grants under this section may not exceed--
       ``(A) $1,000,000 for fiscal year 1996; and
       ``(B) $2,500,000 for each of fiscal years 1997 through 
     2002.
       ``(c) Eligible Entities.--To be eligible for a grant under 
     subsection (b), a private nonprofit entity must--
       ``(1) have experience in the area of--
       ``(A) community food work, particularly concerning small 
     and medium-sized farms, including the provision of food to 
     people in low-income communities and the development of new 
     markets in low-income communities for agricultural producers; 
     or
       ``(B) job training and business development activities for 
     food-related activities in low-income communities;
       ``(2) demonstrate competency to implement a project, 
     provide fiscal accountability, collect data, and prepare 
     reports and other necessary documentation; and
       ``(3) demonstrate a willingness to share information with 
     researchers, practitioners, and other interested parties.
       ``(d) Preference for Certain Projects.--In selecting 
     community food projects to receive assistance under 
     subsection (b), the Secretary shall give a preference to 
     projects designed to--
       ``(1) develop linkages between 2 or more sectors of the 
     food system;
       ``(2) support the development of entrepreneurial projects;
       ``(3) develop innovative linkages between the for-profit 
     and nonprofit food sectors; or
       ``(4) encourage long-term planning activities and multi-
     system, interagency approaches.
       ``(e) Matching Funds Requirements.--
       ``(1) Requirements.--The Federal share of the cost of 
     establishing or carrying out a community food project that 
     receives assistance under subsection (b) may not exceed 50 
     percent of the cost of the project during the term of the 
     grant.
       ``(2) Calculation.--In providing for the non-Federal share 
     of the cost of carrying out a community food project, the 
     entity receiving the grant shall provide for the share 
     through a payment in cash or in kind, fairly evaluated, 
     including facilities, equipment, or services.
       ``(3) Sources.--An entity may provide for the non-Federal 
     share through State government, local government, or private 
     sources.
       ``(f) Term of Grant.--
       ``(1) Single grant.--A community food project may be 
     supported by only a single grant under subsection (b).
       ``(2) Term.--The term of a grant under subsection (b) may 
     not exceed 3 years.
       ``(g) Technical Assistance and Related Information.--
       ``(1) Technical assistance.--In carrying out this section, 
     the Secretary may provide technical assistance regarding 
     community food projects, processes, and development to an 
     entity seeking the assistance.
       ``(2) Sharing Information.--
       ``(A) In general.--The Secretary may provide for the 
     sharing of information concerning community food projects and 
     issues among and between government, private for-profit and 
     nonprofit groups, and the public through publications, 
     conferences, and other appropriate forums.
       ``(B) Other interested parties.--The Secretary may share 
     information concerning community food projects with 
     researchers, practitioners, and other interested parties.
       ``(h) Evaluation.--
       ``(1) In general.--The Secretary shall provide for the 
     evaluation of the success of community food projects 
     supported using funds under this section.
       ``(2) Report.--Not later than January 30, 2002, the 
     Secretary shall submit a report to Congress regarding the 
     results of the evaluation.''.

     SEC. 402. COMMODITY DISTRIBUTION PROGRAM; COMMODITY 
                   SUPPLEMENTAL FOOD PROGRAM.

       (a) Reauthorization.--The first sentence of section 4(a) of 
     the Agriculture and Consumer Protection Act of 1973 (Public 
     Law 93-86; 7 U.S.C. 612c note) is amended by striking 
     ``1995'' and inserting ``2002''.
       (b) Funding.--Section 5 of the Agriculture and Consumer 
     Protection Act of 1973 (Public Law 93-86; 7 U.S.C. 612c note) 
     is amended--
       (1) in subsection (a)(2), by striking ``1995'' and 
     inserting ``2002'';
       (2) in subsection (d)(2), by striking ``1995'' and 
     inserting ``2002''; and
       (3) by adding at the end the following:
       ``(l) Carried-Over Funds.--Not more than 20 percent of any 
     commodity supplemental food program food funds carried over 
     under this section shall be available for administrative 
     expenses of the program.''.

     SEC. 403. EMERGENCY FOOD ASSISTANCE PROGRAM.

       (a) Reauthorization.--The first sentence of section 
     204(a)(1) of the Emergency Food Assistance Act of 1983 
     (Public Law 98-8; 7 U.S.C. 612c note) is amended by striking 
     ``1995'' and inserting ``2002''.
       (b) Program Termination.--Section 212 of the Emergency Food 
     Assistance Act of 1983 (Public Law 98-8; 7 U.S.C. 612c note) 
     is amended by striking ``1995'' and inserting ``2002''.
       (c) Required Purchases of Commodities.--Section 214 of the 
     Emergency Food Assistance Act of 1983 (Public Law 98-8; 7 
     U.S.C. 612c note) is amended--
       (1) in the first sentence of subsection (a), by striking 
     ``1995'' and inserting ``2002''; and
       (2) in subsection (e), by striking ``1995'' each place it 
     appears and inserting ``2002''.

     SEC. 404. SOUP KITCHEN AND FOOD BANK PROGRAM.

       Section 110 of the Hunger Prevention Act of 1988 (Public 
     Law 100-435; 7 U.S.C. 612c note) is amended--
       (1) in the first sentence of subsection (a), by striking 
     ``1995'' and inserting ``2002''; and
       (2) in subsection (c)(2)--
       (A) in the paragraph heading, by striking ``1992 through 
     1995'' and inserting ``Subsequent''; and

[[Page H2754]]

       (B) by striking ``1995'' each place it appears and 
     inserting ``2002''.

     SEC. 405. NATIONAL COMMODITY PROCESSING.

       The first sentence of section 1114(a)(2)(A) of the 
     Agriculture and Food Act of 1981 (7 U.S.C. 1431e(2)(A)) is 
     amended by striking ``1995'' and inserting ``2002''.
                    TITLE V--AGRICULTURAL PROMOTION
             Subtitle A--Commodity Promotion and Evaluation

     SEC. 501. COMMODITY PROMOTION AND EVALUATION.

       (a) Commodity Promotion Law Defined.--In this section, the 
     term ``commodity promotion law'' means a Federal law that 
     provides for the establishment and operation of a promotion 
     program regarding an agricultural commodity that includes a 
     combination of promotion, research, industry information, or 
     consumer information activities, is funded by mandatory 
     assessments on producers or processors, and is designed to 
     maintain or expand markets and uses for the commodity (as 
     determined by the Secretary). The term includes--
       (1) the marketing promotion provisions under section 
     8c(6)(I) of the Agricultural Adjustment Act (7 U.S.C. 
     608c(6)(I)), reenacted with amendments by the Agricultural 
     Marketing Agreement Act of 1937;
       (2) Public Law 89-502 (7 U.S.C. 2101 et seq.);
       (3) title III of Public Law 91-670 (7 U.S.C. 2611 et seq.);
       (4) Public Law 93-428 (7 U.S.C. 2701 et seq.);
       (5) Public Law 94-294 (7 U.S.C. 2901 et seq.);
       (6) subtitle B of title I of Public Law 98-180 (7 U.S.C. 
     4501 et seq.);
       (7) Public Law 98-590 (7 U.S.C. 4601 et seq.);
       (8) subtitle B of title XVI of Public Law 99-198 (7 U.S.C. 
     4801 et seq.);
       (9) subtitle C of title XVI of Public Law 99-198 (7 U.S.C. 
     4901 et seq.);
       (10) subtitle B of title XIX of Public Law 101-624 (7 
     U.S.C. 6101 et seq.);
       (11) subtitle E of title XIX of Public Law 101-624 (7 
     U.S.C. 6301 et seq.);
       (12) subtitle H of title XIX of Public Law 101-624 (7 
     U.S.C. 6401 et seq.);
       (13) Public Law 103-190 (7 U.S.C. 6801 et seq.);
       (14) Public Law 103-407 (7 U.S.C. 7101 et seq.);
       (15) subtitle B;
       (16) subtitle C;
       (17) subtitle D; or
       (18) subtitle E.
       (b) Findings.--Congress finds the following:
       (1) It is in the national public interest and vital to the 
     welfare of the agricultural economy of the United States to 
     maintain and expand existing markets and develop new markets 
     and uses for agricultural commodities through industry-
     funded, Government-supervised, generic commodity promotion 
     programs established under commodity promotion laws.
       (2) These generic commodity promotion programs, funded by 
     the agricultural producers or processors who most directly 
     reap the benefits of the programs and supervised by the 
     Secretary of Agriculture, provide a unique opportunity for 
     producers and processors to inform consumers about their 
     products.
       (3) The central congressional purpose underlying each 
     commodity promotion law has always been to maintain and 
     expand markets for the agricultural commodity covered by the 
     law, rather than to maintain or expand the share of those 
     markets held by any individual producer or processor.
       (4) The commodity promotion laws were neither designed nor 
     intended to prohibit or restrict, and the promotion programs 
     established and funded pursuant to these laws do not prohibit 
     or restrict, individual advertising or promotion of the 
     covered commodities by any producer, processor, or group of 
     producers or processors.
       (5) It has never been the intent of Congress for the 
     generic commodity promotion programs established and funded 
     by the commodity promotion laws to replace the individual 
     advertising and promotion efforts of producers or processors.
       (6) An individual producer's or processor's own advertising 
     initiatives are typically designed to increase the share of 
     the market held by that producer or processor rather than to 
     increase or expand the overall size of the market.
       (7) In contrast, a generic commodity promotion program is 
     intended and designed to maintain or increase the overall 
     demand for the agricultural commodity covered by the program 
     and increase the size of the market for that commodity, often 
     by utilizing promotion methods and techniques that individual 
     producers and processors typically are unable, or have no 
     incentive, to employ.
       (8) The commodity promotion laws establish promotion 
     programs that operate as ``self-help'' mechanisms for 
     producers and processors to fund generic promotions for 
     covered commodities which, under the required supervision and 
     oversight of the Secretary of Agriculture--
       (A) further specific national governmental goals, as 
     established by Congress; and
       (B) produce nonideological and commercial communication the 
     purpose of which is to further the governmental policy and 
     objective of maintaining and expanding the markets for the 
     covered commodities.
       (9) While some commodity promotion laws grant a producer or 
     processor the option of crediting individual advertising 
     conducted by the producer or processor for all or a portion 
     of the producer's or processor's marketing promotion 
     assessments, all promotion programs established under the 
     commodity promotion laws, both those programs that permit 
     credit for individual advertising and those programs that do 
     not contain such provisions, are very narrowly tailored to 
     fulfill the congressional purposes of the commodity promotion 
     laws without impairing or infringing the legal or 
     constitutional rights of any individual producer or 
     processor.
       (10) These generic commodity promotion programs are of 
     particular benefit to small producers who often lack the 
     resources or market power to advertise on their own and who 
     are otherwise often unable to benefit from the economies of 
     scale available in promotion and advertising.
       (11) Periodic independent evaluation of the effectiveness 
     of these generic commodity promotion programs will assist 
     Congress and the Secretary of Agriculture in ensuring that 
     the objectives of the programs are met.
       (c) Independent Evaluation of Promotion Program 
     Effectiveness.--Except as otherwise provided by law, each 
     commodity board established under the supervision and 
     oversight of the Secretary of Agriculture pursuant to a 
     commodity promotion law shall, not less often than every 5 
     years, authorize and fund, from funds otherwise available to 
     the board, an independent evaluation of the effectiveness of 
     the generic commodity promotion programs and other programs 
     conducted by the board pursuant to a commodity promotion law. 
     The board shall submit to the Secretary, and make available 
     to the public, the results of each periodic independent 
     evaluation conducted under this subsection.
       (d) Administrative Costs.--The Secretary shall annually 
     provide to the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate information on administrative 
     expenses on programs established under commodity promotion 
     laws.
Subtitle B--Issuance of Orders for Promotion, Research, and Information 
             Activities Regarding Agricultural Commodities

     SEC. 511. SHORT TITLE.

       This subtitle may be cited as the ``Commodity Promotion, 
     Research, and Information Act of 1996''.

     SEC. 512. FINDINGS AND PURPOSE.

       (a) Findings.--Congress finds the following:
       (1) The production of agricultural commodities plays a 
     significant role in the economy of the United States. 
     Thousands of producers in the United States are involved in 
     the production of agricultural commodities, and such 
     commodities are consumed by millions of people throughout the 
     United States and foreign countries.
       (2) Agricultural commodities must be of high quality, 
     readily available, handled properly, and marketed efficiently 
     to ensure that consumers have an adequate supply.
       (3) The maintenance and expansion of existing markets and 
     the development of new markets for agricultural commodities 
     through generic commodity promotion, research, and 
     information programs are vital to the welfare of persons 
     engaged in the production, marketing, and consumption of such 
     commodities, as well as to the general economy of the United 
     States.
       (4) Generic promotion, research, and information activities 
     for agricultural commodities play a unique role in advancing 
     the demand for such commodities, since such activities 
     increase the total market for a product to the benefit of 
     consumers and all producers. These generic activities 
     complement branded advertising initiatives, which are aimed 
     at increasing the market share of individual competitors, and 
     are of particular benefit to small producers who lack the 
     resources or market power to advertise on their own. These 
     generic activities do not impede the branded advertising 
     efforts of individual firms, but instead increase general 
     market demand for an agricultural commodity using methods 
     that individual companies do not have the incentive to 
     employ.
       (5) Generic promotion, research, and information activities 
     for agricultural commodities, paid by the producers and 
     others in the industry who reap the benefits of such 
     activities, provide a unique opportunity for producers to 
     inform consumers about a particular agricultural commodity.
       (6) It is important to ensure that generic promotion, 
     research, and information activities for agricultural 
     commodities be carried out in an effective and coordinated 
     manner designed to strengthen the position of the commodities 
     in the marketplace and to maintain and expand their markets 
     and uses. Independent evaluation of the effectiveness of the 
     generic promotion activities of these programs will assist 
     the Secretary of Agriculture and Congress in ensuring that 
     these objectives are met.
       (7) The cooperative development, financing, and 
     implementation of a coordinated national program of research, 
     promotion, and information regarding agricultural commodities 
     are necessary to maintain and expand existing markets and to 
     develop new markets for these commodities.
       (8) Agricultural commodities move in interstate and foreign 
     commerce, and agricultural commodities and their products 
     that do not move in such channels of commerce directly burden 
     or affect interstate commerce in agricultural commodities and 
     their products.
       (9) Commodity promotion programs have the ability to 
     provide significant conservation benefits to producers and 
     the public.
       (b) Purpose.--The purpose of this subtitle is to authorize 
     the establishment, through the exercise by the Secretary of 
     Agriculture of the authority provided in this subtitle, of an 
     orderly program for developing, financing, and carrying out 
     an effective, continuous, and coordinated program of generic 
     promotion, research, and information regarding agricultural 
     commodities designed to--
       (1) strengthen the position of agricultural commodity 
     industries in the marketplace;
       (2) maintain and expand existing domestic and foreign 
     markets and uses for agricultural commodities;
       (3) develop new markets and uses for agricultural 
     commodities; or
       (4) assist producers in meeting their conservation 
     objectives.

[[Page H2755]]

       (c) Rule of Construction.--Nothing in this subtitle 
     provides for the control of production or otherwise limits 
     the right of any person to produce, handle, or import an 
     agricultural commodity.

     SEC. 513. DEFINITIONS.

       In this subtitle (unless the context otherwise requires):
       (1) Agricultural commodity.--The term ``agricultural 
     commodity'' means--
       (A) agricultural, horticultural, viticultural, and dairy 
     products;
       (B) livestock and the products of livestock;
       (C) the products of poultry and bee raising;
       (D) the products of forestry;
       (E) other commodities raised or produced on farms, as 
     determined appropriate by the Secretary; and
       (F) products processed or manufactured from products 
     specified in the preceding subparagraphs, as determined 
     appropriate by the Secretary.
       (2) Board.--The term ``board'' means a board established 
     under an order issued under section 514.
       (3) Conflict of interest.--The term ``conflict of 
     interest'' means a situation in which a member or employee of 
     a board has a direct or indirect financial interest in a 
     person that performs a service for, or enters into a contract 
     with, a board for anything of economic value.
       (4) Department.--The term ``Department'' means the 
     Department of Agriculture.
       (5) First handler.--The term ``first handler'' means the 
     first person who buys or takes possession of an agricultural 
     commodity from a producer for marketing. If a producer 
     markets the agricultural commodity directly to consumers, the 
     producer shall be considered to be the first handler with 
     respect to the agricultural commodity produced by the 
     producer.
       (6) Importer.--The term ``importer'' means any person who 
     imports an agricultural commodity from outside the United 
     States for sale in the United States as a principal or as an 
     agent, broker, or consignee of any person.
       (7) Information.--The term ``information'' means 
     information and programs that are designed to increase--
       (A) efficiency in processing; and
       (B) the development of new markets, marketing strategies, 
     increased marketing efficiency, and activities to enhance the 
     image of agricultural commodities on a national or 
     international basis.
       (8) Market.--The term ``market'' means to sell or to 
     otherwise dispose of an agricultural commodity in interstate, 
     foreign, or intrastate commerce.
       (9) Order.--The term ``order'' means an order issued by the 
     Secretary under section 514 that provides for a program of 
     generic promotion, research, and information regarding 
     agricultural commodities designed to--
       (A) strengthen the position of agricultural commodity 
     industries in the marketplace;
       (B) maintain and expand existing domestic and foreign 
     markets and uses for agricultural commodities;
       (C) develop new markets and uses for agricultural 
     commodities; or
       (D) assist producers in meeting their conservation 
     objectives.
       (10) Person.--The term ``person'' means any individual, 
     group of individuals, partnership, corporation, association, 
     cooperative, or any other legal entity.
       (11) Producer.--The term ``producer'' means any person who 
     is engaged in the production and sale of an agricultural 
     commodity in the United States and who owns, or shares the 
     ownership and risk of loss of, the agricultural commodity.
       (12) Promotion.--The term ``promotion'' means any action 
     taken by a board under an order, including paid advertising, 
     to present a favorable image of an agricultural commodity to 
     the public to improve the competitive position of the 
     agricultural commodity in the marketplace and to stimulate 
     sales of the agricultural commodity.
       (13) Research.--The term ``research'' means any type of 
     test, study, or analysis designed to advance the image, 
     desirability, use, marketability, production, product 
     development, or quality of an agricultural commodity.
       (14) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (15) State.--The term ``State'' means any of the States, 
     the District of Columbia, the Commonwealth of Puerto Rico, or 
     any territory or possession of the United States.
       (16) Suspend.--The term ``suspend'' means to issue a rule 
     under section 553 of title 5, United States Code, to 
     temporarily prevent the operation of an order during a 
     particular period of time specified in the rule.
       (17) Terminate.--The term ``terminate'' means to issue a 
     rule under section 553 of title 5, United States Code, to 
     cancel permanently the operation of an order beginning on a 
     date certain specified in the rule.
       (18) United states.--The term ``United States'' means 
     collectively the 50 States, the District of Columbia, the 
     Commonwealth of Puerto Rico and the territories and 
     possessions of the United States.

     SEC. 514. ISSUANCE OF ORDERS.

       (a) Issuance Authorized.--
       (1) In general.--To effectuate the purpose of this 
     subtitle, the Secretary may issue, and amend from time to 
     time, orders applicable to--
       (A) the producers of an agricultural commodity;
       (B) the first handlers of the agricultural commodity and 
     other persons in the marketing chain as appropriate; and
       (C) the importers of the agricultural commodity, if imports 
     of the agricultural commodity are subject to assessment under 
     section 516(f).
       (2) National scope.--Each order issued under this section 
     shall be national in scope.
       (b) Procedure for Issuance.--
       (1) Development or receipt of proposed order.--A proposed 
     order with respect to an agricultural commodity may be--
       (A) prepared by the Secretary at any time; or
       (B) submitted to the Secretary by--
       (i) an association of producers of the agricultural 
     commodity; or
       (ii) any other person that may be affected by the issuance 
     of an order with respect to the agricultural commodity.
       (2) Consideration of proposed order.--If the Secretary 
     determines that a proposed order is consistent with and will 
     effectuate the purpose of this subtitle, the Secretary shall 
     publish the proposed order in the Federal Register and give 
     due notice and opportunity for public comment on the proposed 
     order.
       (3) Existence of other orders.--In deciding whether a 
     proposal for an order is consistent with and will effectuate 
     the purpose of this subtitle, the Secretary may consider the 
     existence of other Federal promotion, research, and 
     information programs or orders issued or developed pursuant 
     to any other law.
       (4) Preparation of final order.--After notice and 
     opportunity for public comment under paragraph (2) regarding 
     a proposed order, the Secretary shall take into consideration 
     the comments received in preparing a final order. The 
     Secretary shall ensure that the final order is in conformity 
     with the terms, conditions, and requirements of this 
     subtitle.
       (c) Issuance and Effective Date.--If the Secretary 
     determines that the final order developed with respect to an 
     agricultural commodity is consistent with and will effectuate 
     the purpose of this subtitle, the Secretary shall issue the 
     final order. Except in the case of an order for which an 
     initial referendum is conducted under section 518(a), the 
     final order shall be issued and become effective not later 
     than 270 days after the date of publication of the proposed 
     order that was the basis for the final order.
       (d) Amendments.--From time to time the Secretary may amend 
     any order, consistent with the requirements of section 523.

     SEC. 515. REQUIRED TERMS IN ORDERS.

       (a) In General.--Each order shall contain the terms and 
     conditions specified in this section.
       (b) Board.--
       (1) Establishment.--Each order shall establish a board to 
     carry out a program of generic promotion, research, and 
     information regarding the agricultural commodity covered by 
     the order and intended to effectuate the purpose of this 
     subtitle.
       (2) Board membership.--
       (A) Number of members.--Each board shall consist of the 
     number of members considered by the Secretary, in 
     consultation with the agricultural commodity industry 
     involved, to be appropriate to administer the order. In 
     addition to members, the Secretary may also provide for 
     alternates on the board.
       (B) Appointment.--The Secretary shall appoint the members 
     and any alternates of a board from among producers of the 
     agricultural commodity and first handlers and others in the 
     marketing chain as appropriate. If imports of the 
     agricultural commodity covered by an order are subject to 
     assessment under section 516(f), the Secretary shall also 
     appoint importers as members of the board and as alternates 
     if alternates are included on the board. The Secretary may 
     appoint 1 or more members of the general public to each 
     board.
       (C) Nominations.--The Secretary may make appointments from 
     nominations made pursuant to the method set forth in the 
     order.
       (D) Geographical representation.--To ensure fair and 
     equitable representation of the agricultural commodity 
     industry covered by an order, the composition of each board 
     shall reflect the geographical distribution of the production 
     of the agricultural commodity involved in the United States 
     and the quantity or value of the agricultural commodity 
     imported into the United States.
       (3) Reapportionment of board membership.--In accordance 
     with rules issued by the Secretary, at least once in each 5-
     year period, but not more frequently than once in each 3-year 
     period, each board shall--
       (A) review the geographical distribution in the United 
     States of the production of the agricultural commodity 
     covered by the order involved and the quantity or value of 
     the agricultural commodity imported into the United States; 
     and
       (B) if warranted, recommend to the Secretary the 
     reapportionment of the board membership to reflect changes in 
     the geographical distribution of the production of the 
     agricultural commodity and the quantity or value of the 
     imported agricultural commodity.
       (4) Notice.--
       (A) Vacancies.--Each order shall provide for notice of 
     board vacancies to the agricultural commodity industry 
     involved.
       (B) Meetings.--Each board shall provide the Secretary with 
     prior notice of meetings of the board to permit the 
     Secretary, or a designated representative of the Secretary, 
     to attend the meetings.
       (5) Term of office.--
       (A) In general.--The members and any alternates of a board 
     shall each serve for a term of 3 years, except that the 
     members and any alternates initially appointed to a board 
     shall serve for terms of not more than 2, 3, and 4 years, as 
     specified by the order.
       (B) Limitation on consecutive terms.--A member or alternate 
     may serve not more than 2 consecutive terms.
       (C) Continuation of term.--Notwithstanding subparagraph 
     (B), each member or alternate shall continue to serve until a 
     successor is appointed by the Secretary.

[[Page H2756]]

       (D) Vacancies.--A vacancy arising before the expiration of 
     a term of office of an incumbent member or alternate of a 
     board shall be filled in a manner provided for in the order.
       (6) Compensation.--
       (A) In general.--Members and any alternates of a board 
     shall serve without compensation.
       (B) Travel expenses.--If approved by a board, members or 
     alternates shall be reimbursed for reasonable travel 
     expenses, which may include a per diem allowance or actual 
     subsistence incurred while away from their homes or regular 
     places of business in the performance of services for the 
     board.
       (c) Powers and Duties of a Board.--Each order shall specify 
     the powers and duties of the board established under the 
     order, which shall include the power and duty--
       (1) to administer the order in accordance with its terms 
     and conditions and to collect assessments;
       (2) to develop and recommend to the Secretary for approval 
     such bylaws as may be necessary for the functioning of the 
     board and such rules as may be necessary to administer the 
     order, including activities authorized to be carried out 
     under the order;
       (3) to meet, organize, and select from among the members of 
     the board a chairperson, other officers, and committees and 
     subcommittees, as the board determines to be appropriate;
       (4) to employ persons, other than the members, as the board 
     considers necessary to assist the board in carrying out its 
     duties, and to determine the compensation and specify the 
     duties of the persons;
       (5) subject to subsection (e), to develop and carry out 
     generic promotion, research, and information activities 
     relating to the agricultural commodity covered by the order;
       (6) to prepare and submit for the approval of the 
     Secretary, before the beginning of each fiscal year, rates of 
     assessment under section 517 and an annual budget of the 
     anticipated expenses to be incurred in the administration of 
     the order, including the probable cost of each promotion, 
     research, and information activity proposed to be developed 
     or carried out by the board;
       (7) to borrow funds necessary for the startup expenses of 
     the order;
       (8) subject to subsection (f), to enter into contracts or 
     agreements to develop and carry out generic promotion, 
     research, and information activities relating to the 
     agricultural commodity covered by the order;
       (9) to pay the cost of the activities with assessments 
     collected under section 517, earnings from invested 
     assessments, and other funds;
       (10) to keep records that accurately reflect the actions 
     and transactions of the board, to keep and report minutes of 
     each meeting of the board to the Secretary, and to furnish 
     the Secretary with any information or records the Secretary 
     requests;
       (11) to receive, investigate, and report to the Secretary 
     complaints of violations of the order; and
       (12) to recommend to the Secretary such amendments to the 
     order as the board considers appropriate.
       (d) Prohibited Activities.--A board may not engage in, and 
     shall prohibit the employees and agents of the board from 
     engaging in--
       (1) any action that would be a conflict of interest;
       (2) using funds collected by the board under the order, any 
     action undertaken for the purpose of influencing any 
     legislation or governmental action or policy other than 
     recommending to the Secretary amendments to the order; and
       (3) any advertising, including promotion, research, and 
     information activities authorized to be carried out under the 
     order, that may be false or misleading or disparaging to 
     another agricultural commodity.
       (e) Activities and Budgets.--
       (1) Activities.--Each order shall require the board 
     established under the order to submit to the Secretary for 
     approval plans and projects for promotion, research, or 
     information relating to the agricultural commodity covered by 
     the order.
       (2) Budgets.--
       (A) Submission to secretary.--Each order shall require the 
     board established under the order to submit to the Secretary 
     for approval a budget of its anticipated annual expenses and 
     disbursements to be paid to administer the order. The budget 
     shall be submitted before the beginning of a fiscal year and 
     as frequently as may be necessary after the beginning of the 
     fiscal year.
       (B) Reimbursement of secretary.--Each order shall require 
     that the Secretary be reimbursed for all expenses incurred by 
     the Secretary in the implementation, administration, and 
     supervision of the order, including all referenda costs 
     incurred in connection with the order.
       (3) Incurring expenses.--A board may incur the expenses 
     described in paragraph (2) and other expenses for the 
     administration, maintenance, and functioning of the board as 
     authorized by the Secretary.
       (4) Payment of expenses.--Expenses incurred under paragraph 
     (3) shall be paid by a board using assessments collected 
     under section 517, earnings obtained from assessments, and 
     other income of the board. Any funds borrowed by the board 
     shall be expended only for startup costs and capital outlays.
       (5) Limitation on spending.--For fiscal years beginning 3 
     or more years after the date of the establishment of a board, 
     the board may not expend for administration (except for 
     reimbursements to the Secretary required under paragraph 
     (2)(B)), maintenance, and functioning of the board in a 
     fiscal year an amount that exceeds 15 percent of the 
     assessment and other income received by the board for the 
     fiscal year.
       (f) Contracts and Agreements.--
       (1) In general.--Each order shall provide that, with the 
     approval of the Secretary, the board established under the 
     order may--
       (A) enter into contracts and agreements to carry out 
     generic promotion, research, and information activities 
     relating to the agricultural commodity covered by the order, 
     including contracts and agreements with producer associations 
     or other entities as considered appropriate by the Secretary; 
     and
       (B) pay the cost of approved generic promotion, research, 
     and information activities using assessments collected under 
     section 517, earnings obtained from assessments, and other 
     income of the board.
       (2) Requirements.--Each contract or agreement shall provide 
     that any person who enters into the contract or agreement 
     with the board shall--
       (A) develop and submit to the board a proposed activity 
     together with a budget that specifies the cost to be incurred 
     to carry out the activity;
       (B) keep accurate records of all of its transactions 
     relating to the contract or agreement;
       (C) account for funds received and expended in connection 
     with the contract or agreement;
       (D) make periodic reports to the board of activities 
     conducted under the contract or agreement; and
       (E) make such other reports as the board or the Secretary 
     considers relevant.
       (g) Records of Board.--
       (1) In general.--Each order shall require the board 
     established under the order--
       (A) to maintain such records as the Secretary may require 
     and to make the records available to the Secretary for 
     inspection and audit;
       (B) to collect and submit to the Secretary, at any time the 
     Secretary may specify, any information the Secretary may 
     request; and
       (C) to account for the receipt and disbursement of all 
     funds in the possession, or under the control, of the board.
       (2) Audits.--Each order shall require the board established 
     under the order to have--
       (A) its records audited by an independent auditor at the 
     end of each fiscal year; and
       (B) a report of the audit submitted directly to the 
     Secretary.
       (h) Periodic Evaluation.--In accordance with section 
     501(c), each order shall require the board established under 
     the order to provide for the independent evaluation of all 
     generic promotion, research, and information activities 
     undertaken under the order.
       (i) Books and Records of Persons Covered by Order.--
       (1) In general.--Each order shall require that producers, 
     first handlers and other persons in the marketing chain as 
     appropriate, and importers covered by the order shall--
       (A) maintain records sufficient to ensure compliance with 
     the order and regulations;
       (B) submit to the board established under the order any 
     information required by the board to carry out its 
     responsibilities under the order; and
       (C) make the records described in subparagraph (A) 
     available, during normal business hours, for inspection by 
     employees or agents of the board or the Department, including 
     any records necessary to verify information required under 
     subparagraph (B).
       (2) Time requirement.--Any record required to be maintained 
     under paragraph (1) shall be maintained for such time period 
     as the Secretary may prescribe.
       (3) Other information.--The Secretary may use, and may 
     authorize the board to use under this subtitle, information 
     regarding persons subject to an order that is collected by 
     the Department under any other law.
       (4) Confidentiality of information.--
       (A) In general.--Except as otherwise provided in this 
     subtitle, all information obtained under paragraph (1) or as 
     part of a referendum under section 518 shall be kept 
     confidential by all officers, employees, and agents of the 
     Department and of the board.
       (B) Disclosure.--Information referred to in subparagraph 
     (A) may be disclosed only if--
       (i) the Secretary considers the information relevant; and
       (ii) the information is revealed in a judicial proceeding 
     or administrative hearing brought at the direction or on the 
     request of the Secretary or to which the Secretary or any 
     officer of the Department is a party.
       (C) Other exceptions.--This paragraph shall not prohibit--
       (i) the issuance of general statements based on reports or 
     on information relating to a number of persons subject to an 
     order if the statements do not identify the information 
     furnished by any person; or
       (ii) the publication, by direction of the Secretary, of the 
     name of any person violating any order and a statement of the 
     particular provisions of the order violated by the person.
       (D) Penalty.--Any person who willfully violates this 
     subsection shall be subject, on conviction, to a fine of not 
     more than $1,000 or to imprisonment for not more than 1 year, 
     or both.
       (5) Withholding information.--This subsection shall not 
     authorize the withholding of information from Congress.

     SEC. 516. PERMISSIVE TERMS IN ORDERS.

       (a) Exemptions.--An order issued under this subtitle may 
     contain--
       (1) authority for the Secretary to exempt from the order 
     any de minimis quantity of an agricultural commodity 
     otherwise covered by the order; and
       (2) authority for the board established under the order to 
     require satisfactory safeguards against improper use of the 
     exemption.
       (b) Different Payment and Reporting Schedules.--An order 
     issued under this subtitle may contain authority for the 
     board established under the order to designate different 
     payment

[[Page H2757]]

     and reporting schedules to recognize differences in 
     agricultural commodity industry marketing practices and 
     procedures used in different production and importing areas.
       (c) Activities.--An order issued under this subtitle may 
     contain authority to develop and carry out research, 
     promotion, and information activities designed to expand, 
     improve, or make more efficient the marketing or use of the 
     agricultural commodity covered by the order in domestic and 
     foreign markets. Section 515(e) shall apply with respect to 
     activities authorized under this subsection.
       (d) Reserve Funds.--An order issued under this subtitle may 
     contain authority to reserve funds from assessments collected 
     under section 517 to permit an effective and continuous 
     coordinated program of research, promotion, and information 
     in years when the yield from assessments may be reduced, 
     except that the amount of funds reserved may not exceed the 
     greatest aggregate amount of the anticipated disbursements 
     specified in budgets approved under section 515(e) by the 
     Secretary for any 2 fiscal years.
       (e) Credits.--
       (1) Generic activities.--An order issued under this 
     subtitle may contain authority to provide credits of 
     assessments for those individuals who contribute to other 
     similar generic research, promotion, and information programs 
     at the State, regional, or local level.
       (2) Branded activities.--
       (A) In general.--The Secretary may permit a farmer 
     cooperative that engages in branded activities relating to 
     the marketing of the products of members of the cooperative 
     to receive an annual credit for the activities and related 
     expenditures in the form of a deduction of the total cost of 
     the activities and related expenditures from the amount of 
     any assessment that would otherwise be required to be paid by 
     the producer members of the cooperative under an order issued 
     under this subtitle.
       (B) Election by cooperative.--A farmer cooperative may 
     elect to voluntarily waive the application of subparagraph 
     (A) to the cooperative.
       (f) Assessment of Imports.--An order issued under this 
     subtitle may contain authority for the board established 
     under the order to assess under section 517 an imported 
     agricultural commodity, or products of such an agricultural 
     commodity, at a rate comparable to the rate determined by the 
     appropriate board for the domestic agricultural commodity 
     covered by the order.
       (g) Other Authority.--An order issued under this subtitle 
     may contain authority to take any other action that--
       (1) is not inconsistent with the purpose of this subtitle, 
     any term or condition specified in section 515, or any rule 
     issued to carry out this subtitle; and
       (2) is necessary to administer the order.

     SEC. 517. ASSESSMENTS.

       (a) Assessments Authorized.--While an order issued under 
     this subtitle is in effect with respect to an agricultural 
     commodity, assessments shall be--
       (1) paid by first handlers with respect to the agricultural 
     commodity produced and marketed in the United States; and
       (2) paid by importers with respect to the agricultural 
     commodity imported into the United States, if the imported 
     agricultural commodity is covered by the order pursuant to 
     section 516(f).
       (b) Collection.--Assessments required under an order shall 
     be remitted to the board established under the order at the 
     time and in the manner prescribed by the order.
       (c) Limitation on Assessments.--Not more than 1 assessment 
     may be levied on a first handler or importer under subsection 
     (a) with respect to any agricultural commodity.
       (d) Assessment Rates.--The board shall recommend to the 
     Secretary 1 or more rates of assessment to be levied under 
     subsection (a). If approved by the Secretary, the rates shall 
     take effect. An order may provide that an assessment rate may 
     not be increased unless approved by a referendum conducted 
     pursuant to section 518.
       (e) Late-Payment and Interest Charges.--
       (1) In general.--Late-payment and interest charges may be 
     levied on each person subject to an order who fails to remit 
     an assessment in accordance with subsection (b).
       (2) Rate.--The rate for the charges shall be specified by 
     the Secretary.
       (f) Investment of Assessments.--Pending disbursement of 
     assessments under a budget approved by the Secretary, a board 
     may invest assessments collected under this section in--
       (1) obligations of the United States or any agency of the 
     United States;
       (2) general obligations of any State or any political 
     subdivision of a State;
       (3) interest-bearing accounts or certificates of deposit of 
     financial institutions that are members of the Federal 
     Reserve System; or
       (4) obligations fully guaranteed as to principal and 
     interest by the United States.
       (g) Refund of Assessments From Escrow Account.--
       (1) Escrow account.--During the period beginning on the 
     effective date of an order and ending on the date the 
     Secretary announces the results of a referendum that is 
     conducted under section 518(b)(1) with respect to the order, 
     the board established under the order shall--
       (A) establish and maintain an escrow account of the kind 
     described in subsection (f)(3) to be used to refund 
     assessments; and
       (B) deposit funds in the account in accordance with 
     paragraph (2).
       (2) Amount to be deposited.--The board shall deposit in the 
     account an amount equal to 10 percent of the assessments 
     collected during the period referred to in paragraph (1).
       (3) Right to receive refund.--Subject to paragraphs (4), 
     (5), and (6), persons subject to an order shall be eligible 
     to demand a refund of assessments collected during the period 
     referred to in paragraph (1) if--
       (A) the assessments were remitted on behalf of the person; 
     and
       (B) the order is not approved in the referendum.
       (4) Form of demand.--The demand for a refund shall be made 
     at such time and in such form as specified by the order.
       (5) Payment of refund.--A person entitled to a refund shall 
     be paid promptly after the board receives satisfactory proof 
     that the assessment for which the refund is demanded was paid 
     on behalf of the person who makes the demand.
       (6) Proration.--If the funds in the escrow account required 
     by paragraph (1) are insufficient to pay the amount of all 
     refunds that persons subject to an order otherwise would have 
     a right to receive under this subsection, the board shall 
     prorate the amount of the funds among all the persons.
       (7) Closing of escrow account.--If the order is approved in 
     a referendum conducted under section 518(b)(1)--
       (A) the escrow account shall be closed; and
       (B) the funds shall be available to the board for 
     disbursement as authorized in the order.

     SEC. 518. REFERENDA.

       (a) Initial Referendum.--
       (1) Optional referendum.--For the purpose of ascertaining 
     whether the persons to be covered by an order favor the order 
     going into effect, the order may provide for the Secretary to 
     conduct an initial referendum among persons to be subject to 
     an assessment under section 517 who, during a representative 
     period determined by the Secretary, engaged in--
       (A) the production or handling of the agricultural 
     commodity covered by the order; or
       (B) the importation of the agricultural commodity.
       (2) Procedure.--The results of the referendum shall be 
     determined in accordance with subsection (e). The Secretary 
     may require that the agricultural commodity industry involved 
     post a bond or other collateral to cover the cost of the 
     referendum.
       (b) Required Referenda.--
       (1) In general.--For the purpose of ascertaining whether 
     the persons covered by an order favor the continuation, 
     suspension, or termination of the order, the Secretary shall 
     conduct a referendum among persons subject to assessments 
     under section 517 who, during a representative period 
     determined by the Secretary, have engaged in--
       (A) the production or handling of the agricultural 
     commodity covered by the order; or
       (B) the importation of the agricultural commodity.
       (2) Time for referendum.--The referendum shall be conducted 
     not later than 3 years after assessments first begin under 
     the order.
       (3) Exception.--This subsection shall not apply if an 
     initial referendum was conducted under subsection (a).
       (c) Subsequent Referenda.--The Secretary shall conduct a 
     subsequent referendum--
       (1) not later than 7 years after assessments first begin 
     under the order;
       (2) at the request of the board established under the 
     order; or
       (3) at the request of 10 percent or more of the number of 
     persons eligible to vote under subsection (b)(1);
     to determine if the persons favor the continuation, 
     suspension or termination of the order.
       (d) Other Referenda.--The Secretary may conduct a 
     referendum at any time to determine whether the continuation, 
     suspension, or termination of the order or a provision of the 
     order is favored by persons eligible to vote under subsection 
     (b)(1).
       (e) Approval of Order.--An order may provide for its 
     approval in a referendum--
       (1) by a majority of those persons voting;
       (2) by persons voting for approval who represent a majority 
     of the volume of the agricultural commodity; or
       (3) by a majority of those persons voting for approval who 
     also represent a majority of the volume of the agricultural 
     commodity.
       (f) Costs of Referenda.--The board established under an 
     order with respect to which a referendum is conducted under 
     this section shall reimburse the Secretary for any expenses 
     incurred by the Secretary to conduct the referendum.
       (g) Manner of Conducting Referenda.--
       (1) In general.--A referendum conducted under this section 
     shall be conducted in the manner determined by the Secretary 
     to be appropriate.
       (2) Advance registration.--If the Secretary determines that 
     an advance registration of eligible voters in a referendum is 
     necessary before the voting period in order to facilitate the 
     conduct of the referendum, the Secretary may institute the 
     advance registration procedures by mail, or in person through 
     the use of national and local offices of the Department.
       (3) Voting.--Eligible voters may vote by mail ballot in the 
     referendum or in person if so prescribed by the Secretary.
       (4) Notice.--Not later than 30 days before a referendum is 
     conducted under this section with respect to an order, the 
     Secretary shall notify the agricultural commodity industry 
     involved, in such manner as determined by the Secretary, of 
     the period during which voting in the referendum will occur. 
     The notice shall explain any registration and voting 
     procedures established under this subsection.

     SEC. 519. PETITION AND REVIEW OF ORDERS.

       (a) Petition.--
       (1) In general.--A person subject to an order issued under 
     this subtitle may file with the Secretary a petition--
       (A) stating that the order, any provision of the order, or 
     any obligation imposed in connection with the order, is not 
     established in accordance with law; and

[[Page H2758]]

       (B) requesting a modification of the order or an exemption 
     from the order.
       (2) Hearing.--The Secretary shall give the petitioner an 
     opportunity for a hearing on the petition, in accordance with 
     regulations issued by the Secretary.
       (3) Ruling.--After the hearing, the Secretary shall make a 
     ruling on the petition. The ruling shall be final, subject to 
     review as set forth in subsection (b).
       (4) Limitation on petition.--Any petition filed under this 
     subsection challenging an order, any provision of the order, 
     or any obligation imposed in connection with the order, shall 
     be filed within 2 years after the effective date of the 
     order, provision, or obligation subject to challenge in the 
     petition.
       (b) Review.--
       (1) Commencement of action.--The district court of the 
     United States for any district in which a person who is a 
     petitioner under subsection (a) resides or carries on 
     business shall have jurisdiction to review the final ruling 
     on the petition of the person, if a complaint for that 
     purpose is filed not later than 20 days after the date of the 
     entry of the final ruling by the Secretary under subsection 
     (a)(3).
       (2) Process.--Service of process in a proceeding may be 
     made on the Secretary by delivering a copy of the complaint 
     to the Secretary.
       (3) Remands.--If the court determines that the ruling is 
     not in accordance with law, the court shall remand the matter 
     to the Secretary with directions--
       (A) to make such ruling as the court determines to be in 
     accordance with law; or
       (B) to take such further action as, in the opinion of the 
     court, the law requires.
       (c) Effect on Enforcement Proceedings.--The pendency of a 
     petition filed under subsection (a) or an action commenced 
     under subsection (b) shall not operate as a stay of any 
     action authorized by section 520 to be taken to enforce this 
     subtitle, including any rule, order, or penalty in effect 
     under this subtitle.

     SEC. 520. ENFORCEMENT.

       (a) Jurisdiction.--The district courts of the United States 
     shall have jurisdiction specifically to enforce, and to 
     prevent and restrain a person from violating, an order or 
     regulation issued under this subtitle.
       (b) Referral to Attorney General.--A civil action 
     authorized to be brought under this section shall be referred 
     to the Attorney General for appropriate action, except that 
     the Secretary shall not be required to refer to the Attorney 
     General a violation of this subtitle if the Secretary 
     believes that the administration and enforcement of this 
     subtitle would be adequately served by providing a suitable 
     written notice or warning to the person who committed the 
     violation or by an administrative action under this section.
       (c) Civil Penalties and Orders.--
       (1) Civil penalties.--A person who willfully violates an 
     order or regulation issued by the Secretary under this Act 
     may be assessed by the Secretary a civil penalty of not less 
     than $1,000 and not more than $10,000 for each violation.
       (2) Separate offense.--Each violation and each day during 
     which there is a failure to comply with an order or 
     regulation issued by the Secretary shall be considered to be 
     a separate offense.
       (3) Cease-and-desist orders.--In addition to, or in lieu 
     of, a civil penalty, the Secretary may issue an order 
     requiring a person to cease and desist from violating the 
     order or regulation.
       (4) Notice and hearing.--No order assessing a penalty or 
     cease-and-desist order may be issued by the Secretary under 
     this subsection unless the Secretary provides notice and an 
     opportunity for a hearing on the record with respect to the 
     violation.
       (5) Finality.--An order assessing a penalty or a cease-and-
     desist order issued under this subsection by the Secretary 
     shall be final and conclusive unless the person against whom 
     the order is issued files an appeal from the order with the 
     United States court of appeals, as provided in subsection 
     (d).
       (d) Review by Court of Appeals.--
       (1) In general.--A person against whom an order is issued 
     under subsection (c) may obtain review of the order by--
       (A) filing, not later than 30 days after the person 
     receives notice of the order, a notice of appeal in--
       (i) the United States court of appeals for the circuit in 
     which the person resides or carries on business; or
       (ii) the United States Court of Appeals for the District of 
     Columbia Circuit; and
       (B) simultaneously sending a copy of the notice of appeal 
     by certified mail to the Secretary.
       (2) Record.--The Secretary shall file with the court a 
     certified copy of the record on which the Secretary has 
     determined that the person has committed a violation.
       (3) Standard of review.--A finding of the Secretary under 
     this section shall be set aside only if the finding is found 
     to be unsupported by substantial evidence on the record.
       (e) Failure To Obey Cease-and-Desist Orders.--A person who 
     fails to obey a valid cease-and-desist order issued by the 
     Secretary under this section, after an opportunity for a 
     hearing, shall be subject to a civil penalty assessed by the 
     Secretary of not less than $1,000 and not more than $10,000 
     for each offense. Each day during which the failure continues 
     shall be considered to be a separate violation of the cease-
     and-desist order.
       (f) Failure To Pay Penalties.--If a person fails to pay a 
     civil penalty imposed under this section by the Secretary, 
     the Secretary shall refer the matter to the Attorney General 
     for recovery of the amount assessed in the district court of 
     the United States for any district in which the person 
     resides or carries on business. In the action, the validity 
     and appropriateness of the order imposing the civil penalty 
     shall not be subject to review.
       (g) Additional Remedies.--The remedies provided in this 
     section shall be in addition to, and not exclusive of, other 
     remedies that may be available.

     SEC. 521. INVESTIGATIONS AND POWER TO SUBPOENA.

       (a) Investigations.--The Secretary may make such 
     investigations as the Secretary considers necessary--
       (1) for the effective administration of this subtitle; or
       (2) to determine whether any person subject to this 
     subtitle has engaged, or is about engage, in any action that 
     constitutes or will constitute a violation of this subtitle 
     or any order or regulation issued under this subtitle.
       (b) Subpoenas, Oaths, and Affirmations.--For the purpose of 
     any investigation under subsection (a), the Secretary may 
     administer oaths and affirmations, subpoena witnesses, compel 
     the attendance of witnesses, take evidence, and require the 
     production of any records or documents that are relevant to 
     the inquiry. The attendance of witnesses and the production 
     of records or documents may be required from any place in the 
     United States.
       (c) Aid of Courts.--In the case of contumacy by, or refusal 
     to obey a subpoena issued to, any person, the Secretary may 
     invoke the aid of any court of the United States within the 
     jurisdiction of which the investigation or proceeding is 
     carried on, or where the person resides or carries on 
     business, in order to require the attendance and testimony of 
     the person or the production of records or documents. The 
     court may issue an order requiring the person to appear 
     before the Secretary to produce records or documents or to 
     give testimony regarding the matter under investigation.
       (d) Contempt.--Any failure to obey the order of the court 
     may be punished by the court as a contempt of the court.
       (e) Process.--Process in any case under this section may be 
     served in the judicial district in which the person resides 
     or carries on business or wherever the person may be found.

     SEC. 522. SUSPENSION OR TERMINATION.

       (a) Mandatory Suspension or Termination.--The Secretary 
     shall suspend or terminate an order or a provision of an 
     order if the Secretary finds that an order or a provision of 
     an order obstructs or does not tend to effectuate the purpose 
     of this subtitle, or if the Secretary determines that the 
     order or a provision of an order is not favored by persons 
     voting in a referendum conducted under section 518.
       (b) Implementation of Suspension or Termination.--If, as a 
     result of a referendum conducted under section 518, the 
     Secretary determines that an order is not approved, the 
     Secretary shall--
       (1) not later than 180 days after making the determination, 
     suspend or terminate, as the case may be, collection of 
     assessments under the order; and
       (2) as soon as practicable, suspend or terminate, as the 
     case may be, activities under the order in an orderly manner.

     SEC. 523. AMENDMENTS TO ORDERS.

       The provisions of this subtitle applicable to an order 
     shall be applicable to any amendment to an order, except that 
     section 518 shall not apply to an amendment.

     SEC. 524. EFFECT ON OTHER LAWS.

       This subtitle shall not affect or preempt any other Federal 
     or State law authorizing promotion or research relating to an 
     agricultural commodity.

     SEC. 525. REGULATIONS.

       The Secretary may issue such regulations as may be 
     necessary to carry out this subtitle and the power vested in 
     the Secretary under this subtitle.

     SEC. 526. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--There are authorized to be appropriated 
     such sums as may be necessary to carry out this subtitle.
       (b) Limitation on Expenditures for Administrative 
     Expenses.--Funds appropriated to carry out this subtitle may 
     not be expended for the payment of expenses incurred by a 
     board to administer an order.
                    Subtitle C--Canola and Rapeseed

     SEC. 531. SHORT TITLE.

       This subtitle may be cited as the ``Canola and Rapeseed 
     Research, Promotion, and Consumer Information Act''.

     SEC. 532. FINDINGS AND DECLARATION OF POLICY.

       (a) Findings.--Congress finds that--
       (1) canola and rapeseed products are an important and 
     nutritious part of the human diet;
       (2) the production of canola and rapeseed products plays a 
     significant role in the economy of the United States in 
     that--
       (A) canola and rapeseed products are produced by thousands 
     of canola and rapeseed producers and processed by numerous 
     processing entities; and
       (B) canola and rapeseed products produced in the United 
     States are consumed by people throughout the United States 
     and foreign countries;
       (3) canola, rapeseed, and canola and rapeseed products 
     should be readily available and marketed efficiently to 
     ensure that consumers have an adequate supply of canola and 
     rapeseed products at a reasonable price;
       (4) the maintenance and expansion of existing markets and 
     development of new markets for canola, rapeseed, and canola 
     and rapeseed products are vital to the welfare of canola and 
     rapeseed producers and processors and those persons concerned 
     with marketing canola, rapeseed, and canola and rapeseed 
     products, as well as to the general economy of the United 
     States, and are necessary to ensure the ready availability 
     and efficient marketing of canola, rapeseed, and canola and 
     rapeseed products;

[[Page H2759]]

       (5) there exist established State and national 
     organizations conducting canola and rapeseed research, 
     promotion, and consumer education programs that are valuable 
     to the efforts of promoting the consumption of canola, 
     rapeseed, and canola and rapeseed products;
       (6) the cooperative development, financing, and 
     implementation of a coordinated national program of canola 
     and rapeseed research, promotion, consumer information, and 
     industry information is necessary to maintain and expand 
     existing markets and develop new markets for canola, 
     rapeseed, and canola and rapeseed products; and
       (7) canola, rapeseed, and canola and rapeseed products move 
     in interstate and foreign commerce, and canola, rapeseed, and 
     canola and rapeseed products that do not move in interstate 
     or foreign commerce directly burden or affect interstate 
     commerce in canola, rapeseed, and canola and rapeseed 
     products.
       (b) Policy.--It is the policy of this subtitle to establish 
     an orderly procedure for developing, financing through 
     assessments on domestically produced canola and rapeseed, and 
     implementing a program of research, promotion, consumer 
     information, and industry information designed to strengthen 
     the position in the marketplace of the canola and rapeseed 
     industry, to maintain and expand existing domestic and 
     foreign markets and uses for canola, rapeseed, and canola and 
     rapeseed products, and to develop new markets and uses for 
     canola, rapeseed, and canola and rapeseed products.
       (c) Construction.--Nothing in this subtitle provides for 
     the control of production or otherwise limits the right of 
     individual producers to produce canola, rapeseed, or canola 
     or rapeseed products.

     SEC. 533. DEFINITIONS.

       In this subtitle (unless the context otherwise requires):
       (1) Board.--The term ``Board'' means the National Canola 
     and Rapeseed Board established under section 535(b).
       (2) Canola; rapeseed.--The terms ``canola'' and 
     ``rapeseed'' mean any brassica plant grown in the United 
     States for the production of an oilseed, the oil of which is 
     used for a food or nonfood use.
       (3) Canola or rapeseed product.--The term ``canola or 
     rapeseed product'' means a product produced, in whole or in 
     part, from canola or rapeseed.
       (4) Commerce.--The term ``commerce'' includes interstate, 
     foreign, and intrastate commerce.
       (5) Conflict of interest.--The term ``conflict of 
     interest'' means a situation in which a member of the Board 
     has a direct or indirect financial interest in a corporation, 
     partnership, sole proprietorship, joint venture, or other 
     business entity dealing directly or indirectly with the 
     Board.
       (6) Consumer information.--The term ``consumer 
     information'' means information that will assist consumers 
     and other persons in making evaluations and decisions 
     regarding the purchase, preparation, and use of canola, 
     rapeseed, or canola or rapeseed products.
       (7) Department.--The term ``Department'' means the 
     Department of Agriculture.
       (8) First purchaser.--The term ``first purchaser'' means--
       (A) except as provided in subparagraph (B), a person who 
     buys or otherwise acquires canola, rapeseed, or canola or 
     rapeseed products produced by a producer; or
       (B) the Commodity Credit Corporation, in a case in which 
     canola or rapeseed is forfeited to the Commodity Credit 
     Corporation as collateral for a loan issued under a price 
     support loan program administered by the Commodity Credit 
     Corporation.
       (9) Industry information.--The term ``industry 
     information'' means information or a program that will lead 
     to the development of new markets, new marketing strategies, 
     or increased efficiency for the canola and rapeseed industry, 
     or an activity to enhance the image of the canola or rapeseed 
     industry.
       (10) Industry member.--The term ``industry member'' means a 
     member of the canola and rapeseed industry who represents--
       (A) manufacturers of canola or rapeseed products; or
       (B) persons who commercially buy or sell canola or 
     rapeseed.
       (11) Marketing.--The term ``marketing'' means the sale or 
     other disposition of canola, rapeseed, or canola or rapeseed 
     products in a channel of commerce.
       (12) Order.--The term ``order'' means an order issued under 
     section 534.
       (13) Person.--The term ``person'' means an individual, 
     partnership, corporation, association, cooperative, or any 
     other legal entity.
       (14) Producer.--The term ``producer'' means a person 
     engaged in the growing of canola or rapeseed in the United 
     States who owns, or who shares the ownership and risk of loss 
     of, the canola or rapeseed.
       (15) Promotion.--The term ``promotion'' means an action, 
     including paid advertising, technical assistance, or a trade 
     servicing activity, to enhance the image or desirability of 
     canola, rapeseed, or canola or rapeseed products in domestic 
     and foreign markets, or an activity designed to communicate 
     to consumers, processors, wholesalers, retailers, government 
     officials, or other persons information relating to the 
     positive attributes of canola, rapeseed, or canola or 
     rapeseed products or the benefits of use or distribution of 
     canola, rapeseed, or canola or rapeseed products.
       (16) Research.--The term ``research'' means any type of 
     test, study, or analysis to advance the image, desirability, 
     marketability, production, product development, quality, or 
     functional or nutritional value of canola, rapeseed, or 
     canola or rapeseed products, including research activity 
     designed to identify and analyze barriers to export sales of 
     canola or rapeseed produced in the United States.
       (17) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (18)  State.--The term ``State'' means any of the 50 
     States, the District of Columbia and the Commonwealth of 
     Puerto Rico.
       (19)  United states.--The term ``United States'' means 
     collectively the 50 States, the District of Columbia, and the 
     Commonwealth of Puerto Rico.

     SEC. 534. ISSUANCE AND AMENDMENT OF ORDERS.

       (a) In General.--Subject to subsection (b), the Secretary 
     shall issue 1 or more orders under this subtitle applicable 
     to producers and first purchasers of canola, rapeseed, or 
     canola or rapeseed products. The order shall be national in 
     scope. Not more than 1 order shall be in effect under this 
     subtitle at any 1 time.
       (b) Procedure.--
       (1) Proposal or request for issuance.--The Secretary may 
     propose the issuance of an order under this subtitle, or an 
     association of canola and rapeseed producers or any other 
     person that would be affected by an order issued pursuant to 
     this subtitle may request the issuance of, and submit a 
     proposal for, an order.
       (2) Notice and comment concerning proposed order.--Not 
     later than 60 days after the receipt of a request and 
     proposal for an order pursuant to paragraph (1), or whenever 
     the Secretary determines to propose an order, the Secretary 
     shall publish a proposed order and give due notice and 
     opportunity for public comment on the proposed order.
       (3) Issuance of order.--After notice and opportunity for 
     public comment are given as provided in paragraph (2), the 
     Secretary shall issue an order, taking into consideration the 
     comments received and including in the order provisions 
     necessary to ensure that the order is in conformity with the 
     requirements of this subtitle. The order shall be issued and 
     become effective not later than 180 days following 
     publication of the proposed order.
       (c) Amendments.--The Secretary may amend an order issued 
     under this section.

     SEC. 535. REQUIRED TERMS IN ORDERS.

       (a) In General.--An order issued under this subtitle shall 
     contain the terms and conditions specified in this section.
       (b) Establishment and Membership of the National Canola and 
     Rapeseed Board.--
       (1) In general.--The order shall provide for the 
     establishment of, and appointment of members to, a National 
     Canola and Rapeseed Board to administer the order.
       (2) Service to entire industry.--The Board shall carry out 
     programs and projects that will provide maximum benefit to 
     the canola and rapeseed industry in all parts of the United 
     States and only promote canola, rapeseed, or canola or 
     rapeseed products.
       (3) Board membership.--The Board shall consist of 15 
     members, including--
       (A) 11 members who are producers, including--
       (i) 1 member from each of the 6 geographic regions 
     comprised of States where canola or rapeseed is produced, as 
     determined by the Secretary; and
       (ii) 5 members from the geographic regions referred to in 
     clause (i), allocated according to the production in each 
     region; and
       (B) 4 members who are industry members, including at 
     least--
       (i) 1 member who represents manufacturers of canola or 
     rapeseed end products; and
       (ii) 1 member who represents persons who commercially buy 
     or sell canola or rapeseed.
       (4) Limitation on state residence.--There shall be no more 
     than 4 producer members of the Board from any 1 State.
       (5) Modifying board membership.--In accordance with 
     regulations approved by the Secretary, at least once each 3 
     years and not more than once each 2 years, the Board shall 
     review the geographic distribution of canola and rapeseed 
     production throughout the United States and, if warranted, 
     recommend to the Secretary that the Secretary--
       (A) reapportion regions in order to reflect the geographic 
     distribution of canola and rapeseed production; and
       (B) reapportion the seats on the Board to reflect the 
     production in each region.
       (6) Certification of organizations.--
       (A) In general.--For the purposes of section 536, the 
     eligibility of any State organization to represent producers 
     shall be certified by the Secretary.
       (B) Criteria.--The Secretary shall certify any State 
     organization that the Secretary determines has a history of 
     stability and permanency and meets at least 1 of the 
     following criteria:
       (i) Majority representation.--The total paid membership of 
     the organization--

       (I) is comprised of at least a majority of canola or 
     rapeseed producers; or
       (II) represents at least a majority of the canola or 
     rapeseed producers in the State.

       (ii) Substantial number of producers represented.--The 
     organization represents a substantial number of producers 
     that produce a substantial quantity of canola or rapeseed in 
     the State.
       (iii) Purpose.--The organization is a general farm or 
     agricultural organization that has as a stated objective the 
     promotion and development of the United States canola or 
     rapeseed industry and the economic welfare of United States 
     canola or rapeseed producers.
       (C) Report.--The Secretary shall make a certification under 
     this paragraph on the basis of a factual report submitted by 
     the State organization.
       (7) Terms of office.--
       (A) In general.--A member of the Board shall serve for a 
     term of 3 years, except that the members appointed to the 
     initial Board shall serve,

[[Page H2760]]

     proportionately, for terms of 1, 2, and 3 years, as 
     determined by the Secretary.
       (B) Limitation on terms.--No individual may serve more than 
     2 consecutive 3-year terms as a member.
       (C) Termination of terms.--Notwithstanding subparagraph 
     (B), each member shall continue to serve until a successor is 
     appointed by the Secretary.
       (8) Compensation.--A member of the Board shall serve 
     without compensation, but shall be reimbursed for necessary 
     and reasonable expenses incurred in the performance of duties 
     for and approved by the Board.
       (c) Powers and Duties of the Board.--The order shall define 
     the powers and duties of the Board, which shall include the 
     power and duty--
       (1) to administer the order in accordance with the terms 
     and conditions of the order;
       (2) to issue regulations to effectuate the terms and 
     conditions of the order;
       (3) to meet, organize, and select from among members of the 
     Board a chairperson, other officers, and committees and 
     subcommittees, as the Board determines appropriate;
       (4) to establish working committees of persons other than 
     Board members;
       (5) to employ such persons, other than Board members, as 
     the Board considers necessary, and to determine the 
     compensation and define the duties of the persons;
       (6) to prepare and submit for the approval of the 
     Secretary, when appropriate or necessary, a recommended rate 
     of assessment under section 536, and a fiscal period budget 
     of the anticipated expenses in the administration of the 
     order, including the probable costs of all programs and 
     projects;
       (7) to develop programs and projects, subject to subsection 
     (d);
       (8) to enter into contracts or agreements, subject to 
     subsection (e), to develop and carry out programs or projects 
     of research, promotion, industry information, and consumer 
     information;
       (9) to carry out research, promotion, industry information, 
     and consumer information projects, and to pay the costs of 
     the projects with assessments collected under section 536;
       (10) to keep minutes, books, and records that reflect the 
     actions and transactions of the Board, and promptly report 
     minutes of each Board meeting to the Secretary;
       (11) to appoint and convene, from time to time, working 
     committees comprised of producers, industry members, and the 
     public to assist in the development of research, promotion, 
     industry information, and consumer information programs for 
     canola, rapeseed, and canola and rapeseed products;
       (12) to invest, pending disbursement under a program or 
     project, funds collected through assessments authorized under 
     section 536, or funds earned from investments, only in--
       (A) obligations of the United States or an agency of the 
     United States;
       (B) general obligations of a State or a political 
     subdivision of a State;
       (C) an interest-bearing account or certificate of deposit 
     of a bank that is a member of the Federal Reserve System; or
       (D) obligations fully guaranteed as to principal and 
     interest by the United States;
       (13) to receive, investigate, and report to the Secretary 
     complaints of violations of the order;
       (14) to furnish the Secretary with such information as the 
     Secretary may request;
       (15) to recommend to the Secretary amendments to the order;
       (16) to develop and recommend to the Secretary for approval 
     such regulations as may be necessary for the development and 
     execution of programs or projects, or as may otherwise be 
     necessary, to carry out the order; and
       (17) to provide the Secretary with advance notice of 
     meetings.
       (d) Programs and Budgets.--
       (1) Submission to secretary.--The order shall provide that 
     the Board shall submit to the Secretary for approval any 
     program or project of research, promotion, consumer 
     information, or industry information. No program or project 
     shall be implemented prior to approval by the Secretary.
       (2) Budgets.--The order shall require the Board, prior to 
     the beginning of each fiscal year, or as may be necessary 
     after the beginning of a fiscal year, to submit to the 
     Secretary for approval budgets of anticipated expenses and 
     disbursements in the implementation of the order, including 
     projected costs of research, promotion, consumer information, 
     and industry information programs and projects.
       (3) Incurring expenses.--The Board may incur such expenses 
     for programs or projects of research, promotion, consumer 
     information, or industry information, and other expenses for 
     the administration, maintenance, and functioning of the Board 
     as may be authorized by the Secretary, including any 
     implementation, administrative, and referendum costs incurred 
     by the Department.
       (4) Paying expenses.--The funds to cover the expenses 
     referred to in paragraph (3) shall be paid by the Board from 
     assessments collected under section 536 or funds borrowed 
     pursuant to paragraph (5).
       (5) Authority to borrow.--To meet the expenses referred to 
     in paragraph (3), the Board shall have the authority to 
     borrow funds, as approved by the Secretary, for capital 
     outlays and startup costs.
       (e) Contracts and Agreements.--
       (1) In general.--To ensure efficient use of funds, the 
     order shall provide that the Board may enter into a contract 
     or agreement for the implementation and carrying out of a 
     program or project of canola, rapeseed, or canola or rapeseed 
     products research, promotion, consumer information, or 
     industry information, including a contract with a producer 
     organization, and for the payment of the costs with funds 
     received by the Board under the order.
       (2) Requirements.--A contract or agreement under paragraph 
     (1) shall provide that--
       (A) the contracting party shall develop and submit to the 
     Board a program or project together with a budget that shall 
     show the estimated costs to be incurred for the program or 
     project;
       (B) the program or project shall become effective on the 
     approval of the Secretary; and
       (C) the contracting party shall keep accurate records of 
     all transactions, account for funds received and expended, 
     make periodic reports to the Board of activities conducted, 
     and make such other reports as the Board or the Secretary may 
     require.
       (3) Producer organizations.--The order shall provide that 
     the Board may contract with a producer organization for any 
     services required in addition to the services described in 
     paragraph (1). The contract shall include provisions 
     comparable to the provisions required by paragraph (2).
       (f) Books and Records of the Board.--
       (1) In general.--The order shall require the Board to--
       (A) maintain such books and records (which shall be 
     available to the Secretary for inspection and audit) as the 
     Secretary may prescribe;
       (B) prepare and submit to the Secretary, from time to time, 
     such reports as the Secretary may prescribe; and
       (C) account for the receipt and disbursement of all funds 
     entrusted to the Board.
       (2) Audits.--The Board shall cause the books and records of 
     the Board to be audited by an independent auditor at the end 
     of each fiscal year, and a report of the audit to be 
     submitted to the Secretary.
       (g) Prohibition.--
       (1) In general.--Subject to paragraph (2), the Board shall 
     not engage in any action to, nor shall any funds received by 
     the Board under this subtitle be used to--
       (A) influence legislation or governmental action;
       (B) engage in an action that would be a conflict of 
     interest;
       (C) engage in advertising that is false or misleading; or
       (D) engage in promotion that would disparage other 
     commodities.
       (2) Action permitted.--Paragraph (1) does not preclude--
       (A) the development and recommendation of amendments to the 
     order;
       (B) the communication to appropriate government officials 
     of information relating to the conduct, implementation, or 
     results of promotion, research, consumer information, or 
     industry information activities under the order; or
       (C) any action designed to market canola or rapeseed 
     products directly to a foreign government or political 
     subdivision of a foreign government.
       (h) Books and Records.--
       (1) In general.--The order shall require that each 
     producer, first purchaser, or industry member shall--
       (A) maintain and submit to the Board any reports considered 
     necessary by the Secretary to ensure compliance with this 
     subtitle; and
       (B) make available during normal business hours, for 
     inspection by employees of the Board or Secretary, such books 
     and records as are necessary to carry out this subtitle, 
     including such records as are necessary to verify any 
     required reports.
       (2) Confidentiality.--
       (A) In general.--Except as otherwise provided in this 
     subtitle, all information obtained from books, records, or 
     reports required to be maintained under paragraph (1) shall 
     be kept confidential, and shall not be disclosed to the 
     public by any person.
       (B) Disclosure.--Information referred to in subparagraph 
     (A) may be disclosed to the public if--
       (i) the Secretary considers the information relevant;
       (ii) the information is revealed in a suit or 
     administrative hearing brought at the direction or on the 
     request of the Secretary or to which the Secretary or any 
     officer of the Department is a party; and
       (iii) the information relates to this subtitle.
       (C) Misconduct.--A knowing disclosure of confidential 
     information in violation of subparagraph (A) by an officer or 
     employee of the Board or Department, except as required by 
     other law or allowed under subparagraph (B) or (D), shall be 
     considered a violation of this subtitle.
       (D) General statements.--Nothing in this paragraph 
     prohibits--
       (i) the issuance of general statements based on the reports 
     of a number of persons subject to an order or statistical 
     data collected from the reports, if the statements do not 
     identify the information furnished by any person; or
       (ii) the publication, by direction of the Secretary, of the 
     name of a person violating the order, together with a 
     statement of the particular provisions of the order violated 
     by the person.
       (3) Availability of information for law enforcement.--
     Information obtained under this subtitle may be made 
     available to another agency of the Federal Government for a 
     civil or criminal law enforcement activity if the activity is 
     authorized by law and if the head of the agency has made a 
     written request to the Secretary specifying the particular 
     information desired and the law enforcement activity for 
     which the information is sought.
       (4) Penalty.--Any person knowingly violating this 
     subsection, on conviction, shall be subject to a fine of not 
     more than $1,000 or to imprisonment for not more than 1 year, 
     or both, and if an officer or employee of the Board or the 
     Department, shall be removed from office or terminated from 
     employment, as applicable.
       (5) Withholding of information.--Nothing in this subtitle 
     authorizes the withholding of information from Congress.

[[Page H2761]]

       (i) Use of Assessments.--The order shall provide that the 
     assessments collected under section 536 shall be used for 
     payment of the expenses in implementing and administering 
     this subtitle, with provision for a reasonable reserve, and 
     to cover administrative costs incurred by the Secretary in 
     implementing and administering this subtitle.
       (j) Other Terms and Conditions.--The order shall contain 
     such other terms and conditions, not inconsistent with this 
     subtitle, as are determined necessary by the Secretary to 
     effectuate this subtitle.

     SEC. 536. ASSESSMENTS.

       (a) In General.--
       (1) First purchasers.--During the effective period of an 
     order issued pursuant to this subtitle, assessments shall 
     be--
       (A) levied on all canola or rapeseed produced in the United 
     States and marketed; and
       (B) deducted from the payment made to a producer for all 
     canola or rapeseed sold to a first purchaser.
       (2) Direct processing.--The order shall provide that any 
     person processing canola or rapeseed of that person's own 
     production and marketing the canola or rapeseed, or canola or 
     rapeseed products, shall remit to the Board or a State 
     organization certified to represent producers under section 
     535(b)(6), in the manner prescribed by the order, an 
     assessment established at a rate equivalent to the rate 
     provided for under subsection (d).
       (b) Limitation on Assessments.--No more than 1 assessment 
     may be assessed under subsection (a) on any canola or 
     rapeseed produced (as remitted by a first purchaser).
       (c) Remitting of Assessments.--
       (1) In general.--Assessments required under subsection (a) 
     shall be remitted to the Board by a first purchaser. The 
     Board shall use State organizations certified to represent 
     producers under section 535(b)(6) to collect the assessments. 
     If an appropriate certified State organization does not exist 
     to collect an assessment, the assessment shall be collected 
     by the Board. There shall be only 1 certified State 
     organization in each State.
       (2) Times to remit assessment.--Each first purchaser shall 
     remit the assessment to the Board as provided for in the 
     order.
       (d) Assessment Rate.--
       (1) Initial rate.--The initial assessment rate shall be 4 
     cents per hundredweight of canola or rapeseed produced and 
     marketed.
       (2) Increase.--The assessment rate may be increased on 
     recommendation by the Board to a rate not exceeding 10 cents 
     per hundredweight of canola or rapeseed produced and marketed 
     in a State, unless--
       (A) after the initial referendum is held under section 
     537(a), the Board recommends an increase above 10 cents per 
     hundredweight; and
       (B) the increase is approved in a referendum under section 
     537(b).
       (3) Credit.--A producer who demonstrates to the Board that 
     the producer is participating in a program of a State 
     organization certified to represent producers under section 
     535(b)(6) shall receive credit, in determining the assessment 
     due from the producer, for contributions to the program of up 
     to 2 cents per hundredweight of canola or rapeseed marketed.
       (e) Late Payment Charge.--
       (1) In general.--There shall be a late payment charge 
     imposed on any person who fails to remit, on or before the 
     date provided for in the order, to the Board the total amount 
     for which the person is liable.
       (2) Amount of charge.--The amount of the late payment 
     charge imposed under paragraph (1) shall be prescribed by the 
     Board with the approval of the Secretary.
       (f) Refund of Assessments From Escrow Account.--
       (1) Establishment of escrow account.--During the period 
     beginning on the date on which an order is first issued under 
     section 534(b)(3) and ending on the date on which a 
     referendum is conducted under section 537(a), the Board 
     shall--
       (A) establish and maintain an escrow account to be used for 
     assessment refunds; and
       (B) place funds in the account in accordance with paragraph 
     (2).
       (2) Placement of funds in account.--The Board shall place 
     in the account, from assessments collected during the period 
     referred to in paragraph (1), an amount equal to the product 
     obtained by multiplying the total amount of assessments 
     collected during the period by 10 percent.
       (3) Right to receive refund.--The Board shall refund to a 
     producer the assessments paid by or on behalf of the producer 
     if--
       (A) the producer is required to pay the assessment;
       (B) the producer does not support the program established 
     under this subtitle; and
       (C) the producer demands the refund prior to the conduct of 
     the referendum under section 537(a).
       (4) Form of demand.--The demand shall be made in accordance 
     with such regulations, in such form, and within such time 
     period as prescribed by the Board.
       (5) Making of refund.--The refund shall be made on 
     submission of proof satisfactory to the Board that the 
     producer paid the assessment for which the refund is 
     demanded.
       (6) Proration.--If--
       (A) the amount in the escrow account required by paragraph 
     (1) is not sufficient to refund the total amount of 
     assessments demanded by eligible producers; and
       (B) the order is not approved pursuant to the referendum 
     conducted under section 537(a);
     the Board shall prorate the amount of the refunds among all 
     eligible producers who demand a refund.
       (7) Program approved.--If the plan is approved pursuant to 
     the referendum conducted under section 537(a), all funds in 
     the escrow account shall be returned to the Board for use by 
     the Board in accordance with this subtitle.

     SEC. 537. REFERENDA.

       (a) Initial Referendum.--
       (1) Requirement.--During the period ending 30 months after 
     the date on which an order is first issued under section 
     534(b)(3), the Secretary shall conduct a referendum among 
     producers who, during a representative period as determined 
     by the Secretary, have been engaged in the production of 
     canola or rapeseed for the purpose of ascertaining whether 
     the order then in effect shall be continued.
       (2) Advance notice.--The Secretary shall, to the extent 
     practicable, provide broad public notice in advance of any 
     referendum. The notice shall be provided, without advertising 
     expenses, by means of newspapers, county newsletters, the 
     electronic media, and press releases, through the use of 
     notices posted in State and county Cooperative State 
     Research, Education, and Extension Service offices and county 
     Consolidated Farm Service Agency offices, and by other 
     appropriate means specified in the order. The notice shall 
     contain information on when the referendum will be held, 
     registration and voting requirements, rules regarding 
     absentee voting, and other pertinent information.
       (3) Approval of order.--The order shall be continued only 
     if the Secretary determines that the order has been approved 
     by not less than a majority of the producers voting in the 
     referendum.
       (4) Disapproval of order.--If continuation of the order is 
     not approved by a majority of the producers voting in the 
     referendum, the Secretary shall terminate collection of 
     assessments under the order within 180 days after the 
     referendum and shall terminate the order in an orderly manner 
     as soon as practicable.
       (b) Additional Referenda.--
       (1) In general.--
       (A) Requirement.--After the initial referendum on an order, 
     the Secretary shall conduct additional referenda, as 
     described in subparagraph (C), if requested by a 
     representative group of producers, as described in 
     subparagraph (B).
       (B) Representative group of producers.--An additional 
     referendum on an order shall be conducted if requested by 10 
     percent or more of the producers who, during a representative 
     period as determined by the Secretary, have been engaged in 
     the production of canola or rapeseed.
       (C) Eligible producers.--Each additional referendum shall 
     be conducted among all producers who, during a representative 
     period as determined by the Secretary, have been engaged in 
     the production of canola or rapeseed to determine whether the 
     producers favor the termination or suspension of the order.
       (2) Disapproval of order.--If the Secretary determines, in 
     a referendum conducted under paragraph (1), that suspension 
     or termination of the order is favored by a majority of the 
     producers voting in the referendum, the Secretary shall 
     suspend or terminate, as appropriate, collection of 
     assessments under the order within 180 days after the 
     determination, and shall suspend or terminate the order, as 
     appropriate, in an orderly manner as soon as practicable 
     after the determination.
       (3) Opportunity to request additional referenda.--
       (A) In general.--Beginning on the date that is 5 years 
     after the conduct of a referendum under this subtitle, and 
     every 5 years thereafter, the Secretary shall provide canola 
     and rapeseed producers an opportunity to request an 
     additional referendum.
       (B) Method of making request.--
       (i) In-person requests.--To carry out subparagraph (A), the 
     Secretary shall establish a procedure under which a producer 
     may make a request for a reconfirmation referendum in person 
     at a county Cooperative State Research, Education, and 
     Extension Service office or a county Consolidated Farm 
     Service Agency office during a period established by the 
     Secretary, or as provided in clause (ii).
       (ii) Mail-in requests.--In lieu of making a request in 
     person, a producer may make a request by mail. To facilitate 
     the submission of requests by mail, the Secretary may make 
     mail-in request forms available to producers.
       (C) Notifications.--The Secretary shall publish a notice in 
     the Federal Register, and the Board shall provide written 
     notification to producers, not later than 60 days prior to 
     the end of the period established under subparagraph (B)(i) 
     for an in-person request, of the opportunity of producers to 
     request an additional referendum. The notification shall 
     explain the right of producers to an additional referendum, 
     the procedure for a referendum, the purpose of a referendum, 
     and the date and method by which producers may act to request 
     an additional referendum under this paragraph. The Secretary 
     shall take such other action as the Secretary determines is 
     necessary to ensure that producers are made aware of the 
     opportunity to request an additional referendum.
       (D) Action by secretary.--As soon as practicable following 
     the submission of a request for an additional referendum, the 
     Secretary shall determine whether a sufficient number of 
     producers have requested the referendum, and take such steps 
     as are necessary to conduct the referendum, as required under 
     paragraph (1).
       (E) Time limit.--An additional referendum requested under 
     the procedures provided in this paragraph shall be conducted 
     not later than 1 year after the Secretary determines that a 
     representative group of producers, as described in paragraph 
     (1)(B), have requested the conduct of the referendum.
       (c) Procedures.--
       (1) Reimbursement of secretary.--The Secretary shall be 
     reimbursed from assessments collected by the Board for any 
     expenses incurred

[[Page H2762]]

     by the Secretary in connection with the conduct of an 
     activity required under this section.
       (2) Date.--Each referendum shall be conducted for a 
     reasonable period of time not to exceed 3 days, established 
     by the Secretary, under a procedure under which producers 
     intending to vote in the referendum shall certify that the 
     producers were engaged in the production of canola, rapeseed, 
     or canola or rapeseed products during the representative 
     period and, at the same time, shall be provided an 
     opportunity to vote in the referendum.
       (3) Place.--Referenda under this section shall be conducted 
     at locations determined by the Secretary. On request, 
     absentee mail ballots shall be furnished by the Secretary in 
     a manner prescribed by the Secretary.

     SEC. 538. PETITION AND REVIEW.

       (a) Petition.--
       (1) In general.--A person subject to an order issued under 
     this subtitle may file with the Secretary a petition--
       (A) stating that the order, a provision of the order, or an 
     obligation imposed in connection with the order is not 
     established in accordance with law; and
       (B) requesting a modification of the order or an exemption 
     from the order.
       (2) Hearings.--The petitioner shall be given the 
     opportunity for a hearing on a petition filed under paragraph 
     (1), in accordance with regulations issued by the Secretary.
       (3) Ruling.--After a hearing under paragraph (2), the 
     Secretary shall issue a ruling on the petition that is the 
     subject of the hearing, which shall be final if the ruling is 
     in accordance with applicable law.
       (4) Limitation on petition.--Any petition filed under this 
     subtitle challenging an order, or any obligation imposed in 
     connection with an order, shall be filed not later than 2 
     years after the effective date of the order or imposition of 
     the obligation.
       (b) Review.--
       (1) Commencement of action.--The district court of the 
     United States for any district in which the person who is a 
     petitioner under subsection (a) resides or carries on 
     business shall have jurisdiction to review a ruling on the 
     petition, if a complaint is filed by the person not later 
     than 20 days after the date of the entry of a ruling by the 
     Secretary under subsection (a)(3).
       (2) Process.--Service of process in a proceeding under 
     paragraph (1) shall be conducted in accordance with the 
     Federal Rules of Civil Procedure.
       (3) Remands.--If the court determines, under paragraph (1), 
     that a ruling issued under subsection (a)(3) is not in 
     accordance with applicable law, the court shall remand the 
     matter to the Secretary with directions either--
       (A) to make such ruling as the court shall determine to be 
     in accordance with law; or
       (B) to take such further proceedings as, in the opinion of 
     the court, the law requires.
       (4) Enforcement.--The pendency of proceedings instituted 
     under subsection (a) shall not impede, hinder, or delay the 
     Attorney General or the Secretary from taking any action 
     under section 539.

     SEC. 539. ENFORCEMENT.

       (a) Jurisdiction.--The district courts of the United States 
     are vested with jurisdiction specifically to enforce, and to 
     prevent and restrain any person from violating, an order or 
     regulation made or issued under this subtitle.
       (b) Referral to Attorney General.--A civil action 
     authorized to be commenced under this section shall be 
     referred to the Attorney General for appropriate action, 
     except that the Secretary shall not be required to refer to 
     the Attorney General a violation of this subtitle if the 
     Secretary believes that the administration and enforcement of 
     this subtitle would be adequately served by providing a 
     suitable written notice or warning to the person committing 
     the violation or by administrative action under subsection 
     (c).
       (c) Civil Penalties and Orders.--
       (1) Civil penalties.--
       (A) In general.--Any person who willfully violates any 
     provision of an order or regulation issued by the Secretary 
     under this subtitle, or who fails or refuses to pay, collect, 
     or remit an assessment or fee required of the person under an 
     order or regulation, may be assessed--
       (i) a civil penalty by the Secretary of not more than 
     $1,000 for each violation; and
       (ii) in the case of a willful failure to pay, collect, or 
     remit an assessment as required by an order or regulation, an 
     additional penalty equal to the amount of the assessment.
       (B) Separate offense.--Each violation under subparagraph 
     (A) shall be a separate offense.
       (2) Cease-and-desist orders.--In addition to, or in lieu 
     of, a civil penalty under paragraph (1), the Secretary may 
     issue an order requiring a person to cease and desist from 
     continuing a violation.
       (3) Notice and hearing.--No penalty shall be assessed, or 
     cease-and-desist order issued, by the Secretary under this 
     subsection unless the person against whom the penalty is 
     assessed or the cease-and-desist order is issued is given 
     notice and opportunity for a hearing before the Secretary 
     with respect to the violation.
       (4) Finality.--The order of the Secretary assessing a 
     penalty or imposing a cease-and-desist order under this 
     subsection shall be final and conclusive unless the affected 
     person files an appeal of the order in the appropriate 
     district court of the United States in accordance with 
     subsection (d).
       (d) Review by District Court.--
       (1) Commencement of action.--Any person who has been 
     determined to be in violation of this subtitle, or against 
     whom a civil penalty has been assessed or a cease-and-desist 
     order issued under subsection (c), may obtain review of the 
     penalty or cease-and-desist order by--
       (A) filing, within the 30-day period beginning on the date 
     the penalty is assessed or cease-and-desist order issued, a 
     notice of appeal in--
       (i) the district court of the United States for the 
     district in which the person resides or carries on business; 
     or
       (ii) the United States District Court for the District of 
     Columbia; and
       (B) simultaneously sending a copy of the notice by 
     certified mail to the Secretary.
       (2) Record.--The Secretary shall file promptly, in the 
     appropriate court referred to in paragraph (1), a certified 
     copy of the record on which the Secretary determined that the 
     person committed the violation.
       (3) Standard of review.--A finding of the Secretary under 
     this section shall be set aside only if the finding is found 
     to be unsupported by substantial evidence.
       (e) Failure To Obey Cease-and-Desist Orders.--Any person 
     who fails to obey a cease-and-desist order issued under this 
     section after the cease-and-desist order has become final and 
     unappealable, or after the appropriate United States district 
     court has entered a final judgment in favor of the Secretary, 
     shall be subject to a civil penalty assessed by the 
     Secretary, after opportunity for a hearing and for judicial 
     review under the procedures specified in subsections (c) and 
     (d), of not more than $5,000 for each offense. Each day 
     during which the failure continues shall be considered as a 
     separate violation of the cease-and-desist order.
       (f) Failure To Pay Penalties.--If a person fails to pay an 
     assessment of a civil penalty under this section after the 
     assessment has become a final and unappealable order, or 
     after the appropriate United States district court has 
     entered final judgment in favor of the Secretary, the 
     Secretary shall refer the matter to the Attorney General for 
     recovery of the amount assessed in the district court of the 
     United States for any district in which the person resides or 
     carries on business. In an action for recovery, the validity 
     and appropriateness of the final order imposing the civil 
     penalty shall not be subject to review.
       (g) Additional Remedies.--The remedies provided in this 
     subtitle shall be in addition to, and not exclusive of, other 
     remedies that may be available.

     SEC. 540. INVESTIGATIONS AND POWER TO SUBPOENA.

       (a) Investigations.--The Secretary may make such 
     investigations as the Secretary considers necessary--
       (1) for the effective administration of this subtitle; and
       (2) to determine whether any person has engaged or is 
     engaging in an act that constitutes a violation of this 
     subtitle, or an order, rule, or regulation issued under this 
     subtitle.
       (b) Subpoenas, Oaths, and Affirmations.--
       (1) In general.--For the purpose of an investigation under 
     subsection (a), the Secretary may administer oaths and 
     affirmations, subpoena witnesses, take evidence, and issue 
     subpoenas to require the production of any records that are 
     relevant to the inquiry. The attendance of witnesses and the 
     production of records may be required from any place in the 
     United States.
       (2) Administrative hearings.--For the purpose of an 
     administrative hearing held under section 538 or 539, the 
     presiding officer is authorized to administer oaths and 
     affirmations, subpoena and compel the attendance of 
     witnesses, take evidence, and require the production of any 
     records that are relevant to the inquiry. The attendance of 
     witnesses and the production of records may be required from 
     any place in the United States.
       (c) Aid of Courts.--In the case of contumacy by, or refusal 
     to obey a subpoena issued to, any person, the Secretary may 
     invoke the aid of any court of the United States within the 
     jurisdiction of which the investigation or proceeding is 
     carried on, or where the person resides or carries on 
     business, in order to enforce a subpoena issued by the 
     Secretary under subsection (b). The court may issue an order 
     requiring the person to comply with the subpoena.
       (d) Contempt.--A failure to obey an order of the court 
     under this section may be punished by the court as contempt 
     of the court.
       (e) Process.--Process may be served on a person in the 
     judicial district in which the person resides or carries on 
     business or wherever the person may be found.
       (f) Hearing Site.--The site of a hearing held under section 
     538 or 539 shall be in the judicial district where the person 
     affected by the hearing resides or has a principal place of 
     business.

     SEC. 541. SUSPENSION OR TERMINATION.

       The Secretary shall, whenever the Secretary finds that an 
     order or a provision of an order obstructs or does not tend 
     to effectuate the declared policy of this subtitle, suspend 
     or terminate the operation of the order or provision. The 
     suspension or termination of an order shall not be considered 
     an order within the meaning of this subtitle.

     SEC. 542. REGULATIONS.

       The Secretary may issue such regulations as are necessary 
     to carry out this subtitle.

     SEC. 543. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--There are authorized to be appropriated 
     for each fiscal year such sums as are necessary to carry out 
     this subtitle.
       (b) Administrative Expenses.--Funds appropriated under 
     subsection (a) shall not be available for payment of the 
     expenses or expenditures of the Board in administering a 
     provision of an order issued under this subtitle.
                         Subtitle D--Kiwifruit

     SEC. 551. SHORT TITLE.

       This subtitle may be cited as the ``National Kiwifruit 
     Research, Promotion, and Consumer Information Act''.

     SEC. 552. FINDINGS AND PURPOSES.

       (a) Findings.--Congress finds that--
       (1) domestically produced kiwifruit are grown by many 
     individual producers;
       (2) virtually all domestically produced kiwifruit are grown 
     in the State of California,

[[Page H2763]]

     although there is potential for production in many other 
     areas of the United States;
       (3) kiwifruit move in interstate and foreign commerce, and 
     kiwifruit that do not move in channels of commerce directly 
     burden or affect interstate commerce;
       (4) in recent years, large quantities of kiwifruit have 
     been imported into the United States;
       (5) the maintenance and expansion of existing domestic and 
     foreign markets for kiwifruit, and the development of 
     additional and improved markets for kiwifruit, are vital to 
     the welfare of kiwifruit producers and other persons 
     concerned with producing, marketing, and processing 
     kiwifruit;
       (6) a coordinated program of research, promotion, and 
     consumer information regarding kiwifruit is necessary for the 
     maintenance and development of the markets; and
       (7) kiwifruit producers, handlers, and importers are unable 
     to implement and finance such a program without cooperative 
     action.
       (b) Purposes.--The purposes of this subtitle are--
       (1) to authorize the establishment of an orderly procedure 
     for the development and financing (through an assessment) of 
     an effective and coordinated program of research, promotion, 
     and consumer information regarding kiwifruit;
       (2) to use the program to strengthen the position of the 
     kiwifruit industry in domestic and foreign markets and 
     maintain, develop, and expand markets for kiwifruit; and
       (3) to treat domestically produced kiwifruit and imported 
     kiwifruit equitably.

     SEC. 553. DEFINITIONS.

       In this subtitle (unless the context otherwise requires):
       (1) Board.--The term ``Board'' means the National Kiwifruit 
     Board established under section 555.
       (2) Consumer information.--The term ``consumer 
     information'' means any action taken to provide information 
     to, and broaden the understanding of, the general public 
     regarding the consumption, use, nutritional attributes, and 
     care of kiwifruit.
       (3) Exporter.--The term ``exporter'' means any person from 
     outside the United States who exports kiwifruit into the 
     United States.
       (4) Handler.--The term ``handler'' means any person, 
     excluding a common carrier, engaged in the business of buying 
     and selling, packing, marketing, or distributing kiwifruit as 
     specified in the order.
       (5) Importer.--The term ``importer'' means any person who 
     imports kiwifruit into the United States.
       (6) Kiwifruit.--The term ``kiwifruit'' means all varieties 
     of fresh kiwifruit grown in or imported into the United 
     States.
       (7) Marketing.--The term ``marketing'' means the sale or 
     other disposition of kiwifruit into interstate, foreign, or 
     intrastate commerce by buying, marketing, distribution, or 
     otherwise placing kiwifruit into commerce.
       (8) Order.--The term ``order'' means a kiwifruit research, 
     promotion, and consumer information order issued by the 
     Secretary under section 554.
       (9) Person.--The term ``person'' means any individual, 
     group of individuals, partnership, corporation, association, 
     cooperative, or other legal entity.
       (10) Processing.--The term ``processing'' means canning, 
     fermenting, distilling, extracting, preserving, grinding, 
     crushing, or in any manner changing the form of kiwifruit for 
     the purpose of preparing the kiwifruit for market or 
     marketing the kiwifruit.
       (11) Producer.--The term ``producer'' means any person who 
     grows kiwifruit in the United States for sale in commerce.
       (12) Promotion.--The term ``promotion'' means any action 
     taken under this subtitle (including paid advertising) to 
     present a favorable image of kiwifruit to the general public 
     for the purpose of improving the competitive position of 
     kiwifruit and stimulating the sale of kiwifruit.
       (13) Research.--The term ``research'' means any type of 
     research relating to the use, nutritional value, and 
     marketing of kiwifruit conducted for the purpose of advancing 
     the image, desirability, marketability, or quality of 
     kiwifruit.
       (14) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (15) United states.--The term ``United States'' means the 
     50 States of the United States, the District of Columbia, and 
     the Commonwealth of Puerto Rico.

     SEC. 554. ISSUANCE OF ORDERS.

       (a) Issuance.--To effectuate the purposes of this subtitle 
     specified in section 552(b), the Secretary shall issue an 
     order applicable to producers, handlers, and importers of 
     kiwifruit. Any such order shall be national in scope. Not 
     more than 1 order shall be in effect under this subtitle at 
     any 1 time.
       (b) Procedure.--
       (1) Proposal for issuance of order.--Any person that will 
     be affected by this subtitle may request the issuance of, and 
     submit a proposal for, an order under this subtitle.
       (2) Proposed order.--Not later than 90 days after the 
     receipt of a request and proposal for an order, the Secretary 
     shall publish a proposed order and give due notice and 
     opportunity for public comment on the proposed order.
       (3) Issuance of order.--After notice and opportunity for 
     public comment are provided under paragraph (2), the 
     Secretary shall issue an order, taking into consideration the 
     comments received and including in the order provisions 
     necessary to ensure that the order is in conformity with this 
     subtitle.
       (c) Amendments.--The Secretary may amend any order issued 
     under this section. The provisions of this subtitle 
     applicable to an order shall be applicable to an amendment to 
     an order.

     SEC. 555. NATIONAL KIWIFRUIT BOARD.

       (a) Membership.--An order issued by the Secretary under 
     section 554 shall provide for the establishment of a National 
     Kiwifruit Board that consists of the following 11 members:
       (1) 6 members who are producers (or representatives of 
     producers) and who are not exempt from an assessment under 
     section 556(b).
       (2) 4 members who are importers (or representatives of 
     importers) and who are not exempt from an assessment under 
     section 556(b) or are exporters (or representatives of 
     exporters).
       (3) 1 member appointed from the general public.
       (b) Adjustment of Membership.--
       (1) In general.--Subject to the 11-member limit and to 
     paragraph (2), the Secretary may adjust membership on the 
     Board to accommodate changes in production and import levels 
     of kiwifruit.
       (2) Number of producer members.--Producers shall comprise 
     not less than 51 percent of the membership of the Board.
       (c) Appointment and Nomination.--
       (1) Appointment.--The Secretary shall appoint the members 
     of the Board from nominations submitted in accordance with 
     this subsection.
       (2) Producers.--The members referred to in subsection 
     (a)(1) shall be appointed from individuals nominated by 
     producers.
       (3) Importers and exporters.--The members referred to in 
     subsection (a)(2) shall be appointed from individuals 
     nominated by importers or exporters.
       (4) Public representative.--The public representative shall 
     be appointed from nominations submitted by other members of 
     the Board.
       (5) Failure to nominate.--If producers, importers, and 
     exporters fail to nominate individuals for appointment, the 
     Secretary may appoint members and alternates on a basis 
     provided for in the order. If the Board fails to nominate a 
     public representative, the member may be appointed by the 
     Secretary without a nomination.
       (d) Alternates.--The Secretary shall appoint an alternate 
     for each member of the Board. An alternate shall--
       (1) be appointed in the same manner as the member for whom 
     the individual is an alternate; and
       (2) serve on the Board if the member is absent from a 
     meeting or is disqualified under subsection (f).
       (e) Terms.--A member of the Board shall be appointed for a 
     term of 3 years. No member may serve more than 2 consecutive 
     3-year terms, except that of the members first appointed--
       (1) 5 members shall be appointed for a term of 2 years; and
       (2) 6 members shall be appointed for a term of 3 years.
       (f) Disqualification.--If a member or alternate of the 
     Board who was appointed as a producer, importer, exporter, or 
     public representative member ceases to belong to the group 
     for which the member was appointed, the member or alternate 
     shall be disqualified from serving on the Board.
       (g) Compensation.--A member or alternate of the Board shall 
     serve without pay.
       (h) General Powers and Duties.--The Board shall--
       (1) administer an order issued by the Secretary under 
     section 554, and an amendment to the order, in accordance 
     with the order and amendment and this subtitle;
       (2) prescribe rules and regulations to carry out the order;
       (3) meet, organize, and select from among members of the 
     Board a chairperson, other officers, and committees and 
     subcommittees, as the Board determines appropriate;
       (4) receive, investigate, and report to the Secretary 
     accounts of violations of the order;
       (5) make recommendations to the Secretary with respect to 
     an amendment that should be made to the order; and
       (6) employ or contract with a manager and staff to assist 
     in administering the order, except that, to reduce 
     administrative costs and increase efficiency, the Board shall 
     seek, to the extent practicable, to employ or contract with 
     personnel who are already associated with organizations 
     involved in promoting kiwifruit that are chartered by a 
     State, the District of Columbia, or the Commonwealth of 
     Puerto Rico.

     SEC. 556. REQUIRED TERMS IN ORDER.

       (a) Budgets and Plans.--
       (1) In general.--An order issued under section 554 shall 
     provide for periodic budgets and plans in accordance with 
     this subsection.
       (2) Budgets.--The Board shall prepare and submit to the 
     Secretary a budget prior to the beginning of the fiscal year 
     of the anticipated expenses and disbursements of the Board in 
     the administration of the order, including probable costs of 
     research, promotion, and consumer information. A budget shall 
     become effective on a \2/3\-vote of a quorum of the Board and 
     approval by the Secretary.
       (3) Plans.--Each budget shall include a plan for research, 
     promotion, and consumer information regarding kiwifruit. A 
     plan under this paragraph shall become effective on approval 
     by the Secretary. The Board may enter into contracts and 
     agreements, on approval by the Secretary, for--
       (A) the development and carrying out of the plan; and
       (B) the payment of the cost of the plan, with funds 
     collected pursuant to this subtitle.
       (b) Assessments.--
       (1) In general.--The order shall provide for the imposition 
     and collection of assessments with regard to the production 
     and importation of kiwifruit in accordance with this 
     subsection.
       (2) Rate.--The assessment rate shall be the rate that is 
     recommended by a \2/3\-vote of a

[[Page H2764]]

     quorum of the Board and approved by the Secretary, except 
     that the rate shall not exceed $0.10 per 7-pound tray of 
     kiwifruit or an equivalent rate.
       (3) Collection by first handlers.--Except as provided in 
     paragraph (5), the first handler of kiwifruit shall--
       (A) be responsible for the collection from the producer, 
     and payment to the Board, of assessments required under this 
     subsection; and
       (B) maintain a separate record of the kiwifruit of each 
     producer whose kiwifruit are so handled, including the 
     kiwifruit owned by the handler.
       (4) Importers.--The assessment on imported kiwifruit shall 
     be paid by the importer to the United States Customs Service 
     at the time of entry into the United States and shall be 
     remitted to the Board.
       (5) Exemption from assessment.--The following persons or 
     activities are exempt from an assessment under this 
     subsection:
       (A) A producer who produces less than 500 pounds of 
     kiwifruit per year.
       (B) An importer who imports less than 10,000 pounds of 
     kiwifruit per year.
       (C) A sale of kiwifruit made directly from the producer to 
     a consumer for a purpose other than resale.
       (D) The production or importation of kiwifruit for 
     processing.
       (6) Claim of exemption.--To claim an exemption under 
     paragraph (5) for a particular year, a person shall--
       (A) submit an application to the Board stating the basis 
     for the exemption and certifying that the quantity of 
     kiwifruit produced, imported, or sold by the person will not 
     exceed any poundage limitation required for the exemption in 
     the year; or
       (B) be on a list of approved processors developed by the 
     Board.
       (c) Use of Assessments.--
       (1) Authorized uses.--The order shall provide that funds 
     paid to the Board as assessments under subsection (b) may be 
     used by the Board--
       (A) to pay for research, promotion, and consumer 
     information described in the budget of the Board under 
     subsection (a) and for other expenses incurred by the Board 
     in the administration of an order;
       (B) to pay such other expenses for the administration, 
     maintenance, and functioning of the Board (including any 
     enforcement efforts for the collection of assessments) as may 
     be authorized by the Secretary, including interest and 
     penalties for late payments; and
       (C) to fund a reserve established under section 557(d).
       (2) Required uses.--The order shall provide that funds paid 
     to the Board as assessments under subsection (b) shall be 
     used by the Board--
       (A) to pay the expenses incurred by the Secretary, 
     including salaries and expenses of Federal Government 
     employees, in implementing and administering the order; and
       (B) to reimburse the Secretary for any expenses incurred by 
     the Secretary in conducting referenda under this subtitle.
       (3) Limitation on use of assessments.--Except for the first 
     year of operation of the Board, expenses for the 
     administration, maintenance, and functioning of the Board may 
     not exceed 30 percent of the budget for a year.
       (d) False Claims.--The order shall provide that any 
     promotion funded with assessments collected under subsection 
     (b) may not make--
       (1) any false claims on behalf of kiwifruit; and
       (2) any false statements with respect to the attributes or 
     use of any product that competes with kiwifruit for sale in 
     commerce.
       (e) Prohibition on Use of Funds.--The order shall provide 
     that funds collected by the Board under this subtitle through 
     assessments may not, in any manner, be used for the purpose 
     of influencing legislation or governmental policy or action, 
     except for making recommendations to the Secretary as 
     provided for under this subtitle.
       (f) Books, Records, and Reports.--
       (1) Board.--The order shall require the Board--
       (A) to maintain books and records with respect to the 
     receipt and disbursement of funds received by the Board;
       (B) to submit to the Secretary from time to time such 
     reports as the Secretary may require for appropriate 
     accounting; and
       (C) to submit to the Secretary at the end of each fiscal 
     year a complete audit report by an independent auditor 
     regarding the activities of the Board during the fiscal year.
       (2) Others.--To make information and data available to the 
     Board and the Secretary that is appropriate or necessary for 
     the effectuation, administration, or enforcement of this 
     subtitle (or any order or regulation issued under this 
     subtitle), the order shall require handlers and importers who 
     are responsible for the collection, payment, or remittance of 
     assessments under subsection (b)--
       (A) to maintain and make available for inspection by the 
     employees and agents of the Board and the Secretary such 
     books and records as may be required by the order; and
       (B) to file, at the times and in the manner and content 
     prescribed by the order, reports regarding the collection, 
     payment, or remittance of the assessments.
       (g) Confidentiality.--
       (1) In general.--The order shall require that all 
     information obtained pursuant to subsection (f)(2) be kept 
     confidential by all officers, employees, and agents of the 
     Department of Agriculture and of the Board. Only such 
     information as the Secretary considers relevant shall be 
     disclosed to the public and only in a suit or administrative 
     hearing, brought at the request of the Secretary or to which 
     the Secretary or any officer of the United States is a party, 
     involving the order with respect to which the information was 
     furnished or acquired.
       (2) Limitations.--Nothing in this subsection prohibits--
       (A) the issuance of general statements based on the reports 
     of a number of handlers and importers subject to an order, if 
     the statements do not identify the information furnished by 
     any person; or
       (B) the publication, by direction of the Secretary, of the 
     name of any person violating an order issued under section 
     554(a), together with a statement of the particular 
     provisions of the order violated by the person.
       (3) Penalty.--Any person who willfully violates this 
     subsection, on conviction, shall be subject to a fine of not 
     more than $1,000 or to imprisonment for not more than 1 year, 
     or both, and, if the person is a member, officer, or agent of 
     the board or an employee of the Department of Agriculture, 
     shall be removed from office.
       (h) Withholding of Information.--Nothing in this subtitle 
     authorizes the withholding of information from Congress.

     SEC. 557. PERMISSIVE TERMS IN ORDER.

       (a) Permissive Terms.--On the recommendation of the Board 
     and with the approval of the Secretary, an order issued under 
     section 554 may include the terms and conditions specified in 
     this section and such additional terms and conditions as the 
     Secretary considers necessary to effectuate the other 
     provisions of the order and are incidental to, and not 
     inconsistent with, this subtitle.
       (b) Alternative Payment and Reporting Schedules.--The order 
     may authorize the Board to designate different handler 
     payment and reporting schedules to recognize differences in 
     marketing practices and procedures.
       (c) Working Groups.--The order may authorize the Board to 
     convene working groups drawn from producers, handlers, 
     importers, exporters, or the general public and utilize the 
     expertise of the groups to assist in the development of 
     research and marketing programs for kiwifruit.
       (d) Reserve Funds.--The order may authorize the Board to 
     accumulate reserve funds from assessments collected pursuant 
     to section 556(b) to permit an effective and continuous 
     coordinated program of research, promotion, and consumer 
     information in years in which production and assessment 
     income may be reduced, except that any reserve fund may not 
     exceed the amount budgeted for operation of this subtitle for 
     1 year.
       (e) Promotion Activities Outside United States.--The order 
     may authorize the Board to use, with the approval of the 
     Secretary, funds collected under section 556(b) and funds 
     from other sources for the development and expansion of sales 
     in foreign markets of kiwifruit produced in the United 
     States.

     SEC. 558. PETITION AND REVIEW.

       (a) Petition.--
       (1) In general.--A person subject to an order may file with 
     the Secretary a petition--
       (A) stating that the order, a provision of the order, or an 
     obligation imposed in connection with the order is not in 
     accordance with law; and
       (B) requesting a modification of the order or an exemption 
     from the order.
       (2) Hearings.--A person submitting a petition under 
     paragraph (1) shall be given an opportunity for a hearing on 
     the petition, in accordance with regulations issued by the 
     Secretary.
       (3) Ruling.--After the hearing, the Secretary shall issue a 
     ruling on the petition which shall be final if the petition 
     is in accordance with law.
       (4) Limitation on petition.--Any petition filed under this 
     subtitle challenging an order, or any obligation imposed in 
     connection with an order, shall be filed not later than 2 
     years after the effective date of the order or imposition of 
     the obligation.
       (b) Review.--
       (1) Commencement of action.--The district court of the 
     United States for any district in which the person who is a 
     petitioner under subsection (a) resides or carries on 
     business is vested with jurisdiction to review the ruling on 
     the petition of the person, if a complaint for that purpose 
     is filed not later than 20 days after the date of the entry 
     of a ruling by the Secretary under subsection (a).
       (2) Process.--Service of process in the proceedings shall 
     be conducted in accordance with the Federal Rules of Civil 
     Procedure.
       (3) Remands.--If the court determines that the ruling is 
     not in accordance with law, the court shall remand the matter 
     to the Secretary with directions--
       (A) to make such ruling as the court shall determine to be 
     in accordance with law; or
       (B) to take such further action as, in the opinion of the 
     court, the law requires.
       (4) Enforcement.--The pendency of a proceeding instituted 
     pursuant to subsection (a) shall not impede, hinder, or delay 
     the Attorney General or the Secretary from obtaining relief 
     pursuant to section 559.

     SEC. 559. ENFORCEMENT.

       (a) Jurisdiction.--A district court of the United States 
     shall have jurisdiction specifically to enforce, and to 
     prevent and restrain any person from violating, any order or 
     regulation made or issued by the Secretary under this 
     subtitle.
       (b) Referral to Attorney General.--A civil action 
     authorized to be brought under this section shall be referred 
     to the Attorney General for appropriate action, except that 
     the Secretary is not required to refer to the Attorney 
     General a violation of this subtitle, or any order or 
     regulation issued under this subtitle, if the Secretary 
     believes that the administration and enforcement of this 
     subtitle would be adequately served by administrative action 
     under subsection (c) or suitable written notice or warning to 
     the person committing the violation.

[[Page H2765]]

       (c) Civil Penalties and Orders.--
       (1) Civil penalties.--Any person who willfully violates any 
     provision of any order or regulation issued by the Secretary 
     under this subtitle, or who fails or refuses to pay, collect, 
     or remit any assessment or fee duly required of the person 
     under the order or regulation, may be assessed a civil 
     penalty by the Secretary of not less than $500 nor more than 
     $5,000 for each such violation. Each violation shall be a 
     separate offense.
       (2) Cease-and-desist orders.--In addition to or in lieu of 
     the civil penalty, the Secretary may issue an order requiring 
     the person to cease and desist from continuing the violation.
       (3) Notice and hearing.--No order assessing a civil penalty 
     or cease-and-desist order may be issued by the Secretary 
     under this subsection unless the Secretary gives the person 
     against whom the order is issued notice and opportunity for a 
     hearing on the record before the Secretary with respect to 
     the violation.
       (4) Finality.--The order of the Secretary assessing a 
     penalty or imposing a cease-and-desist order shall be final 
     and conclusive unless the person against whom the order is 
     issued files an appeal of the order in the appropriate 
     district court of the United States, in accordance with 
     subsection (d).
       (d) Review by United States District Court.--
       (1) Commencement of action.--Any person against whom a 
     violation is found and a civil penalty assessed or cease-and-
     desist order issued under subsection (c) may obtain review of 
     the penalty or cease-and-desist order in the district court 
     of the United States for the district in which the person 
     resides or carries on business, or the United States District 
     Court for the District of Columbia, by--
       (A) filing a notice of appeal in the court not later than 
     30 days after the date on which the penalty is assessed or 
     cease-and-desist order issued; and
       (B) simultaneously sending a copy of the notice by 
     certified mail to the Secretary.
       (2) Record.--The Secretary shall promptly file in the court 
     a certified copy of the record on which the Secretary found 
     that the person committed the violation.
       (3) Standard of review.--A finding of the Secretary shall 
     be set aside only if the finding is found to be unsupported 
     by substantial evidence.
       (e) Failure To Obey Cease-and-Desist Orders.--Any person 
     who fails to obey a cease-and-desist order issued by the 
     Secretary after the cease-and-desist order has become final 
     and unappealable, or after the appropriate United States 
     district court has entered a final judgment in favor of the 
     Secretary, shall be subject to a civil penalty assessed by 
     the Secretary, after opportunity for a hearing and for 
     judicial review under the procedures specified in 
     subsections (c) and (d), of not more than $500 for each 
     offense. Each day during which the failure continues shall 
     be considered a separate violation of the cease-and-desist 
     order.
       (f) Failure To Pay Penalties.--If a person fails to pay an 
     assessment of a civil penalty after the assessment has become 
     a final and unappealable order issued by the Secretary, or 
     after the appropriate United States district court has 
     entered final judgment in favor of the Secretary, the 
     Secretary shall refer the matter to the Attorney General for 
     recovery of the amount assessed in the district court of the 
     United States for any district in which the person resides or 
     carries on business. In an action for recovery, the validity 
     and appropriateness of the final order imposing the civil 
     penalty shall not be subject to review.

     SEC. 560. INVESTIGATIONS AND POWER TO SUBPOENA.

       (a) In General.--The Secretary may make such investigations 
     as the Secretary considers necessary--
       (1) for the effective carrying out of the responsibilities 
     of the Secretary under this subtitle; or
       (2) to determine whether a person subject to this subtitle 
     has engaged or is engaging in any act that constitutes a 
     violation of this subtitle, or any order, rule, or regulation 
     issued under this subtitle.
       (b) Power to Subpoena.--
       (1) Investigations.--For the purpose of an investigation 
     made under subsection (a), the Secretary may administer oaths 
     and affirmations and may issue subpoenas to require the 
     production of any records that are relevant to the inquiry. 
     The production of any such records may be required from any 
     place in the United States.
       (2) Administrative hearings.--For the purpose of an 
     administrative hearing held under section 558 or 559, the 
     presiding officer is authorized to administer oaths and 
     affirmations, subpoena witnesses, compel the attendance of 
     witnesses, take evidence, and require the production of any 
     records that are relevant to the inquiry. The attendance of 
     witnesses and the production of any such records may be 
     required from any place in the United States.
       (c) Aid of Courts.--In the case of contumacy by, or refusal 
     to obey a subpoena to, any person, the Secretary may invoke 
     the aid of any court of the United States within the 
     jurisdiction of which the investigation or proceeding is 
     carried on, or where the person resides or carries on 
     business, to enforce a subpoena issued by the Secretary under 
     subsection (b). The court may issue an order requiring the 
     person to comply with the subpoena.
       (d) Contempt.--Any failure to obey the order of the court 
     may be punished by the court as a contempt of the court.
       (e) Process.--Process in any such case may be served in the 
     judicial district in which the person resides or carries on 
     business or wherever the person may be found.
       (f) Hearing Site.--The site of any hearing held under 
     section 558 or 559 shall be in the judicial district where 
     the person affected by the hearing resides or has a principal 
     place of business.

     SEC. 561. REFERENDA.

       (a) Initial Referendum.--
       (1) Referendum required.--During the 60-day period 
     immediately preceding the proposed effective date of an order 
     issued under section 554, the Secretary shall conduct a 
     referendum among kiwifruit producers and importers who will 
     be subject to assessments under the order, to ascertain 
     whether producers and importers approve the implementation of 
     the order.
       (2) Approval of order.--The order shall become effective, 
     as provided in section 554, if the Secretary determines 
     that--
       (A) the order has been approved by a majority of the 
     producers and importers voting in the referendum; and
       (B) the producers and importers favoring approval produce 
     and import more than 50 percent of the total volume of 
     kiwifruit produced and imported by persons voting in the 
     referendum.
       (b) Subsequent Referenda.--The Secretary may periodically 
     conduct a referendum to determine if kiwifruit producers and 
     importers favor the continuation, termination, or suspension 
     of any order issued under section 554 that is in effect at 
     the time of the referendum.
       (c) Required Referenda.--The Secretary shall hold a 
     referendum under subsection (b)--
       (1) at the end of the 6-year period beginning on the 
     effective date of the order and at the end of each subsequent 
     6-year period;
       (2) at the request of the Board; or
       (3) if not less than 30 percent of the kiwifruit producers 
     and importers subject to assessments under the order submit a 
     petition requesting the referendum.
       (d) Vote.--On completion of a referendum under subsection 
     (b), the Secretary shall suspend or terminate the order that 
     was subject to the referendum at the end of the marketing 
     year if--
       (1) the suspension or termination of the order is favored 
     by not less than a majority of the producers and importers 
     voting in the referendum; and
       (2) the producers and importers produce and import more 
     than 50 percent of the total volume of kiwifruit produced and 
     imported by persons voting in the referendum.
       (e) Confidentiality.--The ballots and other information or 
     reports that reveal, or tend to reveal, the vote of any 
     person under this subtitle and the voting list shall be held 
     strictly confidential and shall not be disclosed.

     SEC. 562. SUSPENSION OR TERMINATION.

       (a) In General.--If the Secretary finds that an order 
     issued under section 554, or a provision of the order, 
     obstructs or does not tend to effectuate the purposes of this 
     subtitle, the Secretary shall suspend or terminate the 
     operation of the order or provision.
       (b) Limitation.--The suspension or termination of any 
     order, or any provision of an order, shall not be considered 
     an order under this subtitle.

     SEC. 563. REGULATIONS.

       The Secretary may issue such regulations as are necessary 
     to carry out this subtitle.

     SEC. 564. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated for each fiscal 
     year such sums as are necessary to carry out this subtitle.
                          Subtitle E--Popcorn

     SEC. 571. SHORT TITLE.

       This subtitle may be cited as the ``Popcorn Promotion, 
     Research, and Consumer Information Act''.

     SEC. 572. FINDINGS AND DECLARATION OF POLICY.

       (a) Findings.--Congress finds that--
       (1) popcorn is an important food that is a valuable part of 
     the human diet;
       (2) the production and processing of popcorn plays a 
     significant role in the economy of the United States in that 
     popcorn is processed by several popcorn processors, 
     distributed through wholesale and retail outlets, and 
     consumed by millions of people throughout the United States 
     and foreign countries;
       (3) popcorn must be of high quality, readily available, 
     handled properly, and marketed efficiently to ensure that the 
     benefits of popcorn are available to the people of the United 
     States;
       (4) the maintenance and expansion of existing markets and 
     uses and the development of new markets and uses for popcorn 
     are vital to the welfare of processors and persons concerned 
     with marketing, using, and producing popcorn for the market, 
     as well as to the agricultural economy of the United States;
       (5) the cooperative development, financing, and 
     implementation of a coordinated program of popcorn promotion, 
     research, consumer information, and industry information is 
     necessary to maintain and expand markets for popcorn; and
       (6) popcorn moves in interstate and foreign commerce, and 
     popcorn that does not move in those channels of commerce 
     directly burdens or affects interstate commerce in popcorn.
       (b) Policy.--It is the policy of Congress that it is in the 
     public interest to authorize the establishment, through the 
     exercise of the powers provided in this subtitle, of an 
     orderly procedure for developing, financing (through adequate 
     assessments on unpopped popcorn processed domestically), and 
     carrying out an effective, continuous, and coordinated 
     program of promotion, research, consumer information, and 
     industry information designed to--
       (1) strengthen the position of the popcorn industry in the 
     marketplace; and
       (2) maintain and expand domestic and foreign markets and 
     uses for popcorn.
       (c) Purposes.--The purposes of this subtitle are to--
       (1) maintain and expand the markets for all popcorn 
     products in a manner that--

[[Page H2766]]

       (A) is not designed to maintain or expand any individual 
     share of a producer or processor of the market;
       (B) does not compete with or replace individual advertising 
     or promotion efforts designed to promote individual brand 
     name or trade name popcorn products; and
       (C) authorizes and funds programs that result in government 
     speech promoting government objectives; and
       (2) establish a nationally coordinated program for popcorn 
     promotion, research, consumer information, and industry 
     information.
       (d) Statutory Construction.--This subtitle treats 
     processors equitably. Nothing in this subtitle--
       (1) provides for the imposition of a trade barrier to the 
     entry into the United States of imported popcorn for the 
     domestic market; or
       (2) provides for the control of production or otherwise 
     limits the right of any individual processor to produce 
     popcorn.

     SEC. 573. DEFINITIONS.

       In this subtitle (unless the context otherwise requires):
       (1) Board.--The term ``Board'' means the Popcorn Board 
     established under section 575(b).
       (2) Commerce.--The term ``commerce'' means interstate, 
     foreign, or intrastate commerce.
       (3) Consumer information.--The term ``consumer 
     information'' means information and programs that will assist 
     consumers and other persons in making evaluations and 
     decisions regarding the purchase, preparation, and use of 
     popcorn.
       (4) Department.--The term ``Department'' means the 
     Department of Agriculture.
       (5) Industry information.--The term ``industry 
     information'' means information or a program that will lead 
     to the development of--
       (A) new markets, new marketing strategies, or increased 
     efficiency for the popcorn industry; or
       (B) activities to enhance the image of the popcorn 
     industry.
       (6) Marketing.--The term ``marketing'' means the sale or 
     other disposition of unpopped popcorn for human consumption 
     in a channel of commerce, but does not include a sale or 
     disposition to or between processors.
       (7) Order.--The term ``order'' means an order issued under 
     section 574.
       (8) Person.--The term ``person'' means an individual, group 
     of individuals, partnership, corporation, association, or 
     cooperative, or any other legal entity.
       (9) Popcorn.--The term ``popcorn'' means unpopped popcorn 
     (Zea Mays L) that is--
       (A) commercially grown;
       (B) processed in the United States by shelling, cleaning, 
     or drying; and
       (C) introduced into a channel of commerce.
       (10) Process.--The term ``process'' means to shell, clean, 
     dry, and prepare popcorn for the market, but does not include 
     packaging popcorn for the market without also engaging in 
     another activity described in this paragraph.
       (11) Processor.--The term ``processor'' means a person 
     engaged in the preparation of unpopped popcorn for the market 
     who owns or shares the ownership and risk of loss of the 
     popcorn and who processes and distributes over 4,000,000 
     pounds of popcorn in the market per year.
       (12) Promotion.--The term ``promotion'' means an action, 
     including paid advertising, to enhance the image or 
     desirability of popcorn.
       (13) Research.--The term ``research'' means any type of 
     study to advance the image, desirability, marketability, 
     production, product development, quality, or nutritional 
     value of popcorn.
       (14) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (15) State.--The term ``State'' means each of the 50 States 
     and the District of Columbia.
       (16) United states.--The term ``United States'' means all 
     of the States.

     SEC. 574. ISSUANCE OF ORDERS.

       (a) In General.--To effectuate the policy described in 
     section 572(b), the Secretary, subject to subsection (b), 
     shall issue 1 or more orders applicable to processors. An 
     order shall be applicable to all popcorn production and 
     marketing areas in the United States. Not more than 1 order 
     shall be in effect under this subtitle at any 1 time.
       (b) Procedure.--
       (1) Proposal or request for issuance.--The Secretary may 
     propose the issuance of an order, or an association of 
     processors or any other person that would be affected by an 
     order may request the issuance of, and submit a proposal for, 
     an order.
       (2) Notice and comment concerning proposed order.--Not 
     later than 60 days after the receipt of a request and 
     proposal for an order under paragraph (1), or at such time as 
     the Secretary determines to propose an order, the Secretary 
     shall publish a proposed order and give due notice and 
     opportunity for public comment on the proposed order.
       (3) Issuance of order.--After notice and opportunity for 
     public comment under paragraph (2), the Secretary shall issue 
     an order, taking into consideration the comments received and 
     including in the order such provisions as are necessary to 
     ensure that the order conforms to this subtitle. The order 
     shall be issued and become effective not later than 150 days 
     after the date of publication of the proposed order.
       (c) Amendments.--The Secretary, as appropriate, may amend 
     an order. The provisions of this subtitle applicable to an 
     order shall be applicable to any amendment to an order, 
     except that an amendment to an order may not require a 
     referendum to become effective.

     SEC. 575. REQUIRED TERMS IN ORDERS.

       (a) In General.--An order shall contain the terms and 
     conditions specified in this section.
       (b) Establishment and Membership of Popcorn Board.--
       (1) In general.--The order shall provide for the 
     establishment of, and appointment of members to, a Popcorn 
     Board that shall consist of not fewer than 4 members and not 
     more than 9 members.
       (2) Nominations.--The members of the Board shall be 
     processors appointed by the Secretary from nominations 
     submitted by processors in a manner authorized by the 
     Secretary, subject to paragraph (3). Not more than 1 member 
     may be appointed to the Board from nominations submitted by 
     any 1 processor.
       (3) Geographical diversity.--In making appointments, the 
     Secretary shall take into account, to the extent practicable, 
     the geographical distribution of popcorn production 
     throughout the United States.
       (4) Terms.--The term of appointment of each member of the 
     Board shall be 3 years, except that the members appointed to 
     the initial Board shall serve, proportionately, for terms of 
     2, 3, and 4 years, as determined by the Secretary.
       (5) Compensation and expenses.--A member of the Board shall 
     serve without compensation, but shall be reimbursed for the 
     expenses of the member incurred in the performance of duties 
     for the Board.
       (c) Powers and Duties of Board.--The order shall define the 
     powers and duties of the Board, which shall include the power 
     and duty--
       (1) to administer the order in accordance with the terms 
     and provisions of the order;
       (2) to issue regulations to effectuate the terms and 
     provisions of the order;
       (3) to appoint members of the Board to serve on an 
     executive committee;
       (4) to propose, receive, evaluate, and approve budgets, 
     plans, and projects of promotion, research, consumer 
     information, and industry information, and to contract with 
     appropriate persons to implement the plans or projects;
       (5) to accept and receive voluntary contributions, gifts, 
     and market promotion or similar funds;
       (6) to invest, pending disbursement under a plan or 
     project, funds collected through assessments authorized under 
     subsection (f), only in--
       (A) obligations of the United States or an agency of the 
     United States;
       (B) general obligations of a State or a political 
     subdivision of a State;
       (C) an interest-bearing account or certificate of deposit 
     of a bank that is a member of the Federal Reserve System; or
       (D) obligations fully guaranteed as to principal and 
     interest by the United States;
       (7) to receive, investigate, and report to the Secretary 
     complaints of violations of the order; and
       (8) to recommend to the Secretary amendments to the order.
       (d) Plans and Budgets.--
       (1) In general.--The order shall provide that the Board 
     shall submit to the Secretary for approval any plan or 
     project of promotion, research, consumer information, or 
     industry information.
       (2) Budgets.--The order shall require the Board to submit 
     to the Secretary for approval budgets on a fiscal year basis 
     of the anticipated expenses and disbursements of the Board in 
     the implementation of the order, including projected costs of 
     plans and projects of promotion, research, consumer 
     information, and industry information.
       (e) Contracts and Agreements.--
       (1) In general.--The order shall provide that the Board may 
     enter into contracts or agreements for the implementation and 
     carrying out of plans or projects of promotion, research, 
     consumer information, or industry information, including 
     contracts with a processor organization, and for the payment 
     of the cost of the plans or projects with funds collected by 
     the Board under the order.
       (2) Requirements.--A contract or agreement under paragraph 
     (1) shall provide that--
       (A) the contracting party shall develop and submit to the 
     Board a plan or project, together with a budget that shows 
     the estimated costs to be incurred for the plan or project;
       (B) the plan or project shall become effective on the 
     approval of the Secretary; and
       (C) the contracting party shall keep accurate records of 
     each transaction of the party, account for funds received and 
     expended, make periodic reports to the Board of activities 
     conducted, and make such other reports as the Board or the 
     Secretary may require.
       (3) Processor organizations.--The order shall provide that 
     the Board may contract with processor organizations for any 
     services required in addition to the services described in 
     paragraph (1). The contract shall include provisions 
     comparable to the provisions required by paragraph (2).
       (f) Assessments.--
       (1) Processors.--The order shall provide that each 
     processor marketing popcorn in the United States or for 
     export shall, in the manner prescribed in the order, pay 
     assessments and remit the assessments to the Board.
       (2) Direct marketers.--A processor that markets popcorn 
     produced by the processor directly to consumers shall pay and 
     remit the assessments on the popcorn directly to the Board in 
     the manner prescribed in the order.
       (3) Rate.--
       (A) In general.--The rate of assessment prescribed in the 
     order shall be a rate established by the Board but not more 
     than $.08 per hundredweight of popcorn.
       (B) Adjustment of rate.--The order shall provide that the 
     Board, with the approval of the Secretary, may raise or lower 
     the rate of assessment annually up to a maximum of $.08 per 
     hundredweight of popcorn.
       (4) Use of assessments.--
       (A) In general.--Subject to subparagraphs (B) and (C) and 
     subsection (c)(5), the order shall provide that the 
     assessments collected shall be used by the Board--

[[Page H2767]]

       (i) to pay expenses incurred in implementing and 
     administering the order, with provision for a reasonable 
     reserve; and
       (ii) to cover such administrative costs as are incurred by 
     the Secretary, except that the administrative costs incurred 
     by the Secretary (other than any legal expenses incurred to 
     defend and enforce the order) that may be reimbursed by the 
     Board may not exceed 15 percent of the projected annual 
     revenues of the Board.
       (B) Expenditures based on source of assessments.--In 
     implementing plans and projects of promotion, research, 
     consumer information, and industry information, the Board 
     shall expend funds on--
       (i) plans and projects for popcorn marketed in the United 
     States or Canada in proportion to the amount of assessments 
     collected on domestically marketed popcorn; and
       (ii) plans and projects for exported popcorn in proportion 
     to the amount of assessments collected on exported popcorn.
       (C) Notification.--If the administrative costs incurred by 
     the Secretary that are reimbursed by the Board exceed 10 
     percent of the projected annual revenues of the Board, the 
     Secretary shall notify as soon as practicable the Committee 
     on Agriculture of the House of Representatives and the 
     Committee on Agriculture, Nutrition, and Forestry of the 
     Senate.
       (g) Prohibition on Use of Funds.--The order shall prohibit 
     any funds collected by the Board under the order from being 
     used to influence government action or policy, other than the 
     use of funds by the Board for the development and 
     recommendation to the Secretary of amendments to the order.
       (h) Books and Records of the Board.--The order shall 
     require the Board to--
       (1) maintain such books and records (which shall be 
     available to the Secretary for inspection and audit) as the 
     Secretary may prescribe;
       (2) prepare and submit to the Secretary, from time to time, 
     such reports as the Secretary may prescribe; and
       (3) account for the receipt and disbursement of all funds 
     entrusted to the Board.
       (i) Books and Records of Processors.--
       (1) Maintenance and reporting of information.--The order 
     shall require that each processor of popcorn for the market 
     shall--
       (A) maintain, and make available for inspection, such books 
     and records as are required by the order; and
       (B) file reports at such time, in such manner, and having 
     such content as is prescribed in the order.
       (2) Use of information.--The Secretary shall authorize the 
     use of information regarding processors that may be 
     accumulated under a law or regulation other than this 
     subtitle or a regulation issued under this subtitle. The 
     information shall be made available to the Secretary as 
     appropriate for the administration or enforcement of this 
     subtitle, the order, or any regulation issued under this 
     subtitle.
       (3) Confidentiality.--
       (A) In general.--Subject to subparagraphs (B), (C), and 
     (D), all information obtained by the Secretary under 
     paragraphs (1) and (2) shall be kept confidential by all 
     officers, employees, and agents of the Board and the 
     Department.
       (B) Disclosure by secretary.--Information referred to in 
     subparagraph (A) may be disclosed if--
       (i) the Secretary considers the information relevant;
       (ii) the information is revealed in a suit or 
     administrative hearing brought at the request of the 
     Secretary, or to which the Secretary or any officer of the 
     United States is a party; and
       (iii) the information relates to the order.
       (C) Disclosure to other agency of federal government.--
       (i) In general.--No information obtained under the 
     authority of this subtitle may be made available to another 
     agency or officer of the Federal Government for any purpose 
     other than the implementation of this subtitle and any 
     investigatory or enforcement activity necessary for the 
     implementation of this subtitle.
       (ii) Penalty.--A person who knowingly violates this 
     subparagraph shall, on conviction, be subject to a fine of 
     not more than $1,000 or to imprisonment for not more than 1 
     year, or both, and if an officer, employee, or agent of the 
     Board or the Department, shall be removed from office or 
     terminated from employment, as applicable.
       (D) General statements.--Nothing in this paragraph 
     prohibits--
       (i) the issuance of general statements based on the reports 
     of a number of persons subject to an order or statistical 
     data collected from the reports, if the statements do not 
     identify the information provided by any person; or
       (ii) the publication, by direction of the Secretary, of the 
     name of a person violating the order, together with a 
     statement of the particular provisions of the order violated 
     by the person.
       (j) Other Terms and Conditions.--The order shall contain 
     such other terms and conditions, consistent with this 
     subtitle, as are necessary to effectuate this subtitle, 
     including regulations relating to the assessment of late 
     payment charges.

     SEC. 576. REFERENDA.

       (a) Initial Referendum.--
       (1) In general.--Within the 60-day period immediately 
     preceding the effective date of an order, as provided in 
     section 574(b)(3), the Secretary shall conduct a referendum 
     among processors who, during a representative period as 
     determined by the Secretary, have been engaged in processing, 
     for the purpose of ascertaining whether the order shall go 
     into effect.
       (2) Approval of order.--The order shall become effective, 
     as provided in section 574(b), only if the Secretary 
     determines that the order has been approved by not less than 
     a majority of the processors voting in the referendum and if 
     the majority processed more than 50 percent of the popcorn 
     certified as having been processed, during the representative 
     period, by the processors voting.
       (b) Additional Referenda.--
       (1) In general.--Not earlier than 3 years after the 
     effective date of an order approved under subsection (a), on 
     the request of the Board or a representative group of 
     processors, as described in paragraph (2), the Secretary may 
     conduct additional referenda to determine whether processors 
     favor the suspension or termination of the order.
       (2) Representative group of processors.--An additional 
     referendum on an order shall be conducted if the referendum 
     is requested by 30 percent or more of the number of 
     processors who, during a representative period as determined 
     by the Secretary, have been engaged in processing.
       (3) Disapproval of order.--If the Secretary determines, in 
     a referendum conducted under paragraph (1), that suspension 
     or termination of the order is favored by at least \2/3\ of 
     the processors voting in the referendum, the Secretary 
     shall--
       (A) suspend or terminate, as appropriate, collection of 
     assessments under the order not later than 180 days after the 
     date of determination; and
       (B) suspend or terminate the order, as appropriate, in an 
     orderly manner as soon as practicable after the date of 
     determination.
       (c) Costs of Referendum.--The Secretary shall be reimbursed 
     from assessments collected by the Board for any expenses 
     incurred by the Secretary in connection with the conduct of 
     any referendum under this section.
       (d) Method of Conducting Referendum.--Subject to this 
     section, a referendum conducted under this section shall be 
     conducted in such manner as is determined by the Secretary.
       (e) Confidentiality of Ballots and Other Information.--
       (1) In general.--The ballots and other information or 
     reports that reveal or tend to reveal the vote of any 
     processor, or any business operation of a processor, shall be 
     considered to be strictly confidential and shall not be 
     disclosed.
       (2) Penalty for violations.--An officer or employee of the 
     Department who knowingly violates paragraph (1) shall be 
     subject to the penalties described in section 
     575(i)(3)(C)(ii).

     SEC. 577. PETITION AND REVIEW.

       (a) Petition.--
       (1) In general.--A person subject to an order may file with 
     the Secretary a petition--
       (A) stating that the order, a provision of the order, or an 
     obligation imposed in connection with the order is not 
     established in accordance with law; and
       (B) requesting a modification of the order or obligation or 
     an exemption from the order or obligation.
       (2) Statute of limitations.--A petition under paragraph (1) 
     concerning an obligation may be filed not later than 2 years 
     after the date of imposition of the obligation.
       (3) Hearings.--The petitioner shall be given the 
     opportunity for a hearing on a petition filed under paragraph 
     (1), in accordance with regulations issued by the Secretary.
       (4) Ruling.--After a hearing under paragraph (3), the 
     Secretary shall issue a ruling on the petition that is the 
     subject of the hearing, which shall be final if the ruling is 
     in accordance with applicable law.
       (b) Review.--
       (1) Commencement of action.--The district court of the 
     United States for any district in which a person who is a 
     petitioner under subsection (a) resides or carries on 
     business shall have jurisdiction to review a ruling on the 
     petition, if the person files a complaint not later than 20 
     days after the date of issuance of the ruling under 
     subsection (a)(4).
       (2) Process.--Service of process in a proceeding under 
     paragraph (1) may be made on the Secretary by delivering a 
     copy of the complaint to the Secretary.
       (3) Remands.--If the court determines, under paragraph (1), 
     that a ruling issued under subsection (a)(4) is not in 
     accordance with applicable law, the court shall remand the 
     matter to the Secretary with directions--
       (A) to make such ruling as the court shall determine to be 
     in accordance with law; or
       (B) to take such further proceedings as, in the opinion of 
     the court, the law requires.
       (c) Enforcement.--The pendency of proceedings instituted 
     under subsection (a) may not impede, hinder, or delay the 
     Secretary or the Attorney General from taking action under 
     section 578.

     SEC. 578. ENFORCEMENT.

       (a) In General.--The Secretary may issue an enforcement 
     order to restrain or prevent any person from violating an 
     order or regulation issued under this subtitle and may assess 
     a civil penalty of not more than $1,000 for each violation of 
     the enforcement order, after an opportunity for an 
     administrative hearing, if the Secretary determines that the 
     administration and enforcement of the order and this subtitle 
     would be adequately served by such a procedure.
       (b) Jurisdiction.--The district courts of the United States 
     are vested with jurisdiction specifically to enforce, and to 
     prevent and restrain any person from violating, an order or 
     regulation issued under this subtitle.
       (c) Referral to Attorney General.--A civil action 
     authorized to be brought under this section shall be referred 
     to the Attorney General for appropriate action.

     SEC. 579. INVESTIGATIONS AND POWER TO SUBPOENA.

       (a) Investigations.--The Secretary may make such 
     investigations as the Secretary considers necessary--
       (1) for the effective administration of this subtitle; and

[[Page H2768]]

       (2) to determine whether any person subject to this 
     subtitle has engaged, or is about to engage, in an act that 
     constitutes or will constitute a violation of this subtitle 
     or of an order or regulation issued under this subtitle.
       (b) Oaths, Affirmations, and Subpoenas.--For the purpose of 
     an investigation under subsection (a), the Secretary may 
     administer oaths and affirmations, subpoena witnesses, compel 
     the attendance of witnesses, take evidence, and require the 
     production of any records that are relevant to the inquiry. 
     The attendance of witnesses and the production of records may 
     be required from any place in the United States.
       (c) Aid of Courts.--
       (1) Request.--In the case of contumacy by, or refusal to 
     obey a subpoena issued to, any person, the Secretary may 
     request the aid of any court of the United States within the 
     jurisdiction of which the investigation or proceeding is 
     carried on, or where the person resides or carries on 
     business, in requiring the attendance and testimony of the 
     person and the production of records.
       (2) Enforcement order of the court.--The court may issue an 
     enforcement order requiring the person to appear before the 
     Secretary to produce records or to give testimony concerning 
     the matter under investigation.
       (3) Contempt.--A failure to obey an enforcement order of 
     the court under paragraph (2) may be punished by the court as 
     a contempt of the court.
       (4) Process.--Process in a case under this subsection may 
     be served in the judicial district in which the person 
     resides or carries on business or wherever the person may be 
     found.

     SEC. 580. RELATION TO OTHER PROGRAMS.

       Nothing in this subtitle preempts or supersedes any other 
     program relating to popcorn promotion organized and operated 
     under the laws of the United States or any State.

     SEC. 581. REGULATIONS.

       The Secretary may issue such regulations as are necessary 
     to carry out this subtitle.

     SEC. 582. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated such sums as are 
     necessary to carry out this subtitle. Amounts made available 
     under this section or otherwise made available to the 
     Department, and amounts made available under any other 
     marketing or promotion order, may not be used to pay any 
     administrative expense of the Board.
                       Subtitle F--Miscellaneous

     SEC. 591. MAINTENANCE OF RECORDS FOR HONEY PROMOTION PROGRAM.

       Section 9(f) of the Honey Research, Promotion, and Consumer 
     Information Act (7 U.S.C. 4608(f)) is amended by inserting 
     ``producers,'' after ``importers,''.
                            TITLE VI--CREDIT
                    Subtitle A--Farm Ownership Loans

     SEC. 601. LIMITATION ON DIRECT FARM OWNERSHIP LOANS.

       Section 302 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1922) is amended by striking subsection (b) and 
     inserting the following:
       ``(b) Direct Loans.--
       ``(1) In general.--Subject to paragraph (3), the Secretary 
     may make a direct loan under this subtitle only to a farmer 
     or rancher who has operated a farm or ranch for not less than 
     3 years and--
       ``(A) is a qualified beginning farmer or rancher;
       ``(B) has not received a previous direct farm ownership 
     loan made under this subtitle; or
       ``(C) has not received a direct farm ownership loan under 
     this subtitle more than 10 years before the date the new loan 
     would be made.
       ``(2) Youth loans.--The operation of an enterprise by a 
     youth under section 311(b) shall not be considered the 
     operation of a farm or ranch for purposes of paragraph (1).
       ``(3) Transition rule.--
       ``(A) In general.--Subject to subparagraphs (B) and (C), 
     the Secretary may make a direct loan under this subtitle to a 
     farmer or rancher who has a direct loan outstanding under 
     this subtitle on the date of enactment of this paragraph.
       ``(B) Less than 5 years.--If, as of the date of enactment 
     of this paragraph, a farmer or rancher has had a direct loan 
     outstanding under this subtitle for less than 5 years, the 
     Secretary shall not make a loan to the farmer or rancher 
     under subparagraph (A) after the date that is 10 years after 
     the date of enactment of this paragraph.
       ``(C) 5 years or more.--If, as of the date of enactment of 
     this paragraph, a farmer or rancher has had a direct loan 
     outstanding under this subtitle for 5 years or more, the 
     Secretary shall not make a loan to the farmer or rancher 
     under subparagraph (A) after the date that is 5 years after 
     the date of enactment of this paragraph.''.

     SEC. 602. PURPOSES OF LOANS.

       (a) In General.--Section 303 of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 1923) is amended to read as 
     follows:

     ``SEC. 303. PURPOSES OF LOANS.

       ``(a) Allowed Purposes.--
       ``(1) Direct loans.--A farmer or rancher may use a direct 
     loan made under this subtitle only for--
       ``(A) acquiring or enlarging a farm or ranch;
       ``(B) making capital improvements to a farm or ranch;
       ``(C) paying loan closing costs related to acquiring, 
     enlarging, or improving a farm or ranch; or
       ``(D) paying for activities to promote soil and water 
     conservation and protection described in section 304 on a 
     farm or ranch.
       ``(2) Guaranteed loans.--A farmer or rancher may use a loan 
     guaranteed under this subtitle only for--
       ``(A) acquiring or enlarging a farm or ranch;
       ``(B) making capital improvements to a farm or ranch;
       ``(C) paying loan closing costs related to acquiring, 
     enlarging, or improving a farm or ranch;
       ``(D) paying for activities to promote soil and water 
     conservation and protection described in section 304 on a 
     farm or ranch; or
       ``(E) refinancing indebtedness.
       ``(b) Preferences.--In making or guaranteeing a loan under 
     this subtitle for purchase of a farm or ranch, the Secretary 
     shall give preference to a person who--
       ``(1) has a dependent family;
       ``(2) to the extent practicable, is able to make an initial 
     down payment on the farm or ranch; or
       ``(3) is an owner of livestock or farm or ranch equipment 
     that is necessary to successfully carry out farming or 
     ranching operations.
       ``(c) Hazard Insurance Requirement.--
       ``(1) In general.--After the Secretary makes the 
     determination required by paragraph (2), the Secretary may 
     not make a loan to a farmer or rancher under this subtitle 
     unless the farmer or rancher has, or agrees to obtain, hazard 
     insurance on any real property to be acquired or improved 
     with the loan.
       ``(2) Determination.--Not later than 180 days after the 
     date of enactment of this subsection, the Secretary shall 
     determine the appropriate level of insurance to be required 
     under paragraph (1).''.
       (b) Transitional Provision.--Section 303(c)(1) of the 
     Consolidated Farm and Rural Development Act shall not apply 
     until the Secretary of Agriculture makes the determination 
     required by section 303(c)(2) of the Act.

     SEC. 603. SOIL AND WATER CONSERVATION AND PROTECTION.

       Section 304 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1924) is amended--
       (1) by striking subsections (b) and (c);
       (2) by striking ``Sec. 304. (a)(1) Loans'' and inserting 
     the following:

     ``SEC. 304. SOIL AND WATER CONSERVATION AND PROTECTION.

       ``(a) In General.--Loans'';
       (3) by striking ``(2) In making or insuring'' and inserting 
     the following:
       ``(b) Priority.--In making or guaranteeing'';
       (4) by striking ``(3) The Secretary'' and inserting the 
     following:
       ``(c) Loan Maximum.--The Secretary'';
       (5) by redesignating subparagraphs (A) through (F) of 
     subsection (a) (as amended by paragraph (2)) as paragraphs 
     (1) through (6), respectively; and
       (6) by redesignating subparagraphs (A) and (B) of 
     subsection (c) (as amended by paragraph (4)) as paragraphs 
     (1) and (2), respectively.

     SEC. 604. INTEREST RATE REQUIREMENTS.

       Section 307(a)(3) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1927(a)(3)) is amended--
       (1) in subparagraph (B), by inserting ``subparagraph (D) 
     and in'' after ``Except as provided in''; and
       (2) by adding at the end the following:
       ``(D) Joint financing arrangement.--If a direct farm 
     ownership loan is made under this subtitle as part of a joint 
     financing arrangement and the amount of the direct farm 
     ownership loan does not exceed 50 percent of the total 
     principal amount financed under the arrangement, the interest 
     rate on the direct farm ownership loan shall be at least 4 
     percent annually.''.

     SEC. 605. INSURANCE OF LOANS.

       Section 308 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1928) is amended to read as follows:

     ``SEC. 308. FULL FAITH AND CREDIT.

       ``(a) In General.--A contract of insurance or guarantee 
     executed by the Secretary under this title shall be an 
     obligation supported by the full faith and credit of the 
     United States.
       ``(b) Contestability.--A contract of insurance or guarantee 
     executed by the Secretary under this title shall be 
     incontestable except for fraud or misrepresentation that the 
     lender or any holder--
       ``(1) has actual knowledge of at the time the contract or 
     guarantee is executed; or
       ``(2) participates in or condones.''.

     SEC. 606. LOANS GUARANTEED.

       Section 309(h) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1929(h)) is amended by adding at 
     the end the following:
       ``(4) Maximum guarantee of 90 percent.--Except as provided 
     in paragraphs (5) and (6), a loan guarantee under this title 
     shall be for not more than 90 percent of the principal and 
     interest due on the loan.
       ``(5) Refinanced loans guaranteed at 95 percent.--The 
     Secretary shall guarantee 95 percent of--
       ``(A) in the case of a loan that solely refinances a direct 
     loan made under this title, the principal and interest due on 
     the loan on the date of the refinancing; or
       ``(B) in the case of a loan that is used for multiple 
     purposes, the portion of the loan that refinances the 
     principal and interest due on a direct loan made under this 
     title that is outstanding on the date the loan is guaranteed.
       ``(6) Beginning farmer loans guaranteed up to 95 percent.--
     The Secretary may guarantee not more than 95 percent of--
       ``(A) a farm ownership loan for acquiring a farm or ranch 
     to a borrower who is participating in the down payment loan 
     program under section 310E; or
       ``(B) an operating loan to a borrower who is participating 
     in the down payment loan program under section 310E that is 
     made during the period that the borrower has a direct loan 
     outstanding under this subtitle for acquiring a farm or 
     ranch.''.
                      Subtitle B--Operating Loans

     SEC. 611. LIMITATION ON DIRECT OPERATING LOANS.

       (a) In General.--Section 311 of the Consolidated Farm and 
     Rural Development Act (7

[[Page H2769]]

     U.S.C. 1941) is amended by striking subsection (c) and 
     inserting the following:
       ``(c) Direct Loans.--
       ``(1) In general.--Subject to paragraph (3), the Secretary 
     may make a direct loan under this subtitle only to a farmer 
     or rancher who--
       ``(A) is a qualified beginning farmer or rancher who has 
     not operated a farm or ranch, or who has operated a farm or 
     ranch for not more than 5 years;
       ``(B) has not received a previous direct operating loan 
     made under this subtitle; or
       ``(C) has received a previous direct operating loan made 
     under this subtitle during 6 or fewer years.
       ``(2) Youth loans.--In this subsection, the term `direct 
     operating loan' shall not include a loan made to a youth 
     under subsection (b).
       ``(3) Transition rule.--If, as of the date of enactment of 
     this paragraph, a farmer or rancher has received a direct 
     operating loan under this subtitle during each of 4 or more 
     previous years, the borrower shall be eligible to receive a 
     direct operating loan under this subtitle during 3 additional 
     years after the date of enactment of this paragraph.''.
       (b) Youth Enterprises Not Farming or Ranching.--Section 
     311(b) of the Consolidated Farm and Rural Development Act (7 
     U.S.C. 1941(b)) is amended by adding at the end the 
     following:
       ``(4) Youth enterprises not farming or ranching.--The 
     operation of an enterprise by a youth under this subsection 
     shall not be considered the operation of a farm or ranch 
     under this title.''.

     SEC. 612. PURPOSES OF OPERATING LOANS.

       (a) In General.--Section 312 of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 1942) is amended to read as 
     follows:

     ``SEC. 312. PURPOSES OF LOANS.

       ``(a) In General.--A direct loan may be made under this 
     subtitle only for--
       ``(1) paying the costs incident to reorganizing a farm or 
     ranch for more profitable operation;
       ``(2) purchasing livestock, poultry, or farm or ranch 
     equipment;
       ``(3) purchasing feed, seed, fertilizer, insecticide, or 
     farm or ranch supplies, or to meet other essential farm or 
     ranch operating expenses, including cash rent;
       ``(4) financing land or water development, use, or 
     conservation;
       ``(5) paying loan closing costs;
       ``(6) assisting a farmer or rancher in changing the 
     equipment, facilities, or methods of operation of a farm or 
     ranch to comply with a standard promulgated under section 6 
     of the Occupational Safety and Health Act of 1970 (29 U.S.C. 
     655) or a standard adopted by a State under a plan approved 
     under section 18 of the Act (29 U.S.C. 667), if the Secretary 
     determines that without assistance under this paragraph the 
     farmer or rancher is likely to suffer substantial economic 
     injury in complying with the standard;
       ``(7) training a limited-resource borrower receiving a loan 
     under section 310D in maintaining records of farming and 
     ranching operations;
       ``(8) training a borrower under section 359;
       ``(9) refinancing the indebtedness of a borrower, if the 
     borrower--
       ``(A) has refinanced a loan under this subtitle not more 
     than 4 times previously; and
       ``(B)(i) is a direct loan borrower under this title at the 
     time of the refinancing and has suffered a qualifying loss 
     because of a natural disaster declared by the Secretary under 
     this title or a major disaster or emergency designated by the 
     President under the Robert T. Stafford Disaster Relief and 
     Emergency Assistance Act (42 U.S.C. 5121 et seq.); or
       ``(ii) is refinancing a debt obtained from a creditor other 
     than the Secretary; or
       ``(10) providing other farm, ranch, or home needs, 
     including family subsistence.
       ``(b) Guaranteed Loans.--A loan may be guaranteed under 
     this subtitle only for--
       ``(1) paying the costs incident to reorganizing a farm or 
     ranch for more profitable operation;
       ``(2) purchasing livestock, poultry, or farm or ranch 
     equipment;
       ``(3) purchasing feed, seed, fertilizer, insecticide, or 
     farm or ranch supplies, or to meet other essential farm or 
     ranch operating expenses, including cash rent;
       ``(4) financing land or water development, use, or 
     conservation;
       ``(5) refinancing indebtedness;
       ``(6) paying loan closing costs;
       ``(7) assisting a farmer or rancher in changing the 
     equipment, facilities, or methods of operation of a farm or 
     ranch to comply with a standard promulgated under section 6 
     of the Occupational Safety and Health Act of 1970 (29 U.S.C. 
     655) or a standard adopted by a State under a plan approved 
     under section 18 of the Act (29 U.S.C. 667), if the Secretary 
     determines that without assistance under this paragraph the 
     farmer or rancher is likely to suffer substantial economic 
     injury due to compliance with the standard;
       ``(8) training a borrower under section 359; or
       ``(9) providing other farm, ranch, or home needs, including 
     family subsistence.
       ``(c) Hazard Insurance Requirement.--
       ``(1) In general.--After the Secretary makes the 
     determination required by paragraph (2), the Secretary may 
     not make a loan to a farmer or rancher under this subtitle 
     unless the farmer or rancher has, or agrees to obtain, hazard 
     insurance on the property to be acquired with the loan.
       ``(2) Determination.--Not later than 180 days after the 
     date of enactment of this paragraph, the Secretary shall 
     determine the appropriate level of insurance to be required 
     by paragraph (1).
       ``(d) Private Reserve.--
       ``(1) In general.--Notwithstanding any other provision of 
     this title, the Secretary may reserve a portion of any loan 
     made under this subtitle to be placed in an unsupervised bank 
     account that may be used at the discretion of the borrower 
     for the basic family needs of the borrower and the immediate 
     family of the borrower.
       ``(2) Limit on size of the reserve.--The size of the 
     reserve shall not exceed the least of--
       ``(A) 10 percent of the loan;
       ``(B) $5,000; or
       ``(C) the amount needed to provide for the basic family 
     needs of the borrower and the borrower's immediate family for 
     3 calendar months.''.
       (b) Transitional Provision.--Section 312(c)(1) of the 
     Consolidated Farm and Rural Development Act shall not apply 
     until the Secretary of Agriculture makes the determination 
     required by section 312(c)(2) of the Act.

     SEC. 613. PARTICIPATION IN LOANS.

       Section 315 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1945) is repealed.

     SEC. 614. LINE-OF-CREDIT LOANS.

       Section 316 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1946) is amended by adding at the end the 
     following:
       ``(c) Line-of-Credit Loans.--
       ``(1) In general.--A loan made or guaranteed by the 
     Secretary under this subtitle may be in the form of a line-
     of-credit loan.
       ``(2) Term.--A line-of-credit loan under paragraph (1) 
     shall terminate not later than 5 years after the date that 
     the loan is made or guaranteed.
       ``(3) Eligibility.--For purposes of determining eligibility 
     for a farm operating loan under this subtitle, each year 
     during which a farmer or rancher takes an advance or draws on 
     a line-of-credit loan the farmer or rancher shall be 
     considered to have received an operating loan for 1 year.
       ``(4) Termination of delinquent loans.--If a borrower does 
     not pay an installment on a line-of-credit loan on schedule, 
     the borrower may not take an advance or draw on the line-of-
     credit, unless the Secretary determines that--
       ``(A) the borrower's failure to pay on schedule was due to 
     unusual conditions that the borrower could not control; and
       ``(B) the borrower will reduce the line-of-credit balance 
     to the scheduled level at the end of--
       ``(i) the production cycle; or
       ``(ii) the marketing of the borrower's agricultural 
     products.
       ``(5) Agricultural commodities.--A line-of-credit loan may 
     be used to finance the production or marketing of an 
     agricultural commodity that--
       ``(A) is eligible for a price support program of the 
     Department of Agriculture; or
       ``(B) was eligible for a price support program of the 
     Department of Agriculture on the day before the date of 
     enactment of the Federal Agriculture Improvement and Reform 
     Act of 1996.''.

     SEC. 615. INSURANCE OF OPERATING LOANS.

       Section 317 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1947) is repealed.

     SEC. 616. SPECIAL ASSISTANCE FOR BEGINNING FARMERS AND 
                   RANCHERS.

       (a) In General.--Section 318 of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 1948) is repealed.
       (b) Conforming Amendment.--Section 310F of the Consolidated 
     Farm and Rural Development Act (7 U.S.C. 1936) is repealed.

     SEC. 617. LIMITATION ON PERIOD FOR WHICH BORROWERS ARE 
                   ELIGIBLE FOR GUARANTEED ASSISTANCE.

       Section 319 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1949) is amended by striking subsection (b) and 
     inserting the following:
       ``(b) Limitation on Period Borrowers Are Eligible for 
     Guaranteed Assistance.--
       ``(1) General rule.--Subject to paragraph (2), the 
     Secretary shall not guarantee a loan under this subtitle for 
     a borrower for any year after the 15th year that a loan is 
     made to, or a guarantee is provided with respect to, the 
     borrower under this subtitle.
       ``(2) Transition rule.--If, as of October 28, 1992, a 
     farmer or rancher has received a direct or guaranteed 
     operating loan under this subtitle during each of 10 or more 
     previous years, the borrower shall be eligible to receive a 
     guaranteed operating loan under this subtitle during 5 
     additional years after October 28, 1992.''.
                      Subtitle C--Emergency Loans

     SEC. 621. HAZARD INSURANCE REQUIREMENT.

       (a) In General.--Section 321 of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 1961) is amended by striking 
     subsection (b) and inserting the following:
       ``(b) Hazard Insurance Requirement.--
       ``(1) In general.--After the Secretary makes the 
     determination required by paragraph (2), the Secretary may 
     not make a loan to a farmer or rancher under this subtitle to 
     cover a property loss unless the farmer or rancher had hazard 
     insurance that insured the property at the time of the loss.
       ``(2) Determination.--Not later than 180 days after the 
     date of enactment of this paragraph, the Secretary shall 
     determine the appropriate level of insurance to be required 
     under paragraph (1).''.
       (b) Transitional Provision.--Section 321(b)(1) of the 
     Consolidated Farm and Rural Development Act shall not apply 
     until the Secretary of Agriculture makes the determination 
     required by section 321(b)(2) of the Act.

     SEC. 622. NARROWING OF AUTHORITY TO WAIVE APPLICATION OF THE 
                   CREDIT ELSEWHERE TEST.

       The second proviso of section 322(b) of the Consolidated 
     Farm and Rural Development Act (7 U.S.C. 1962(b)) is amended 
     by striking ``$300,000 or less'' and inserting ``$100,000 or 
     less''.

[[Page H2770]]

     SEC. 623. LINKING OF EMERGENCY LOANS FOR CROP OR LIVESTOCK 
                   CHANGES TO NATURAL DISASTERS.

       Section 323 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1963) is amended by inserting ``that are 
     necessitated by a natural disaster, major disaster, or 
     emergency and that are'' after ``livestock changes''.

     SEC. 624. MAXIMUM EMERGENCY LOAN INDEBTEDNESS.

       Section 324 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1964) is amended by striking ``Sec. 324. (a) No 
     loan'' and all that follows through the end of subsection (a) 
     and inserting the following:

     ``SEC. 324. TERMS OF LOANS.

       ``(a) Maximum Amount of Loan.--The Secretary may not make a 
     loan under this subtitle to a borrower who has suffered a 
     loss in an amount that--
       ``(1) exceeds the actual loss caused by a disaster; or
       ``(2) would cause the total indebtedness of the borrower 
     under this subtitle to exceed $500,000.''.

     SEC. 625. ESTABLISHMENT OF DATE FOR EMERGENCY LOAN ASSET 
                   VALUATION.

       The last sentence of section 324(d) of the Consolidated 
     Farm and Rural Development Act (7 U.S.C. 1964(d)) is amended 
     by striking ``value the assets'' and all that follows through 
     the period and inserting ``establish the value of the assets 
     as of the day before the occurrence of the natural disaster, 
     major disaster, or emergency that is the basis for a request 
     for assistance under this subtitle or the Robert T. Stafford 
     Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 
     et seq.).''.

     SEC. 626. INSURANCE OF EMERGENCY LOANS.

       Section 328 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1968) is repealed.
                 Subtitle D--Administrative Provisions

     SEC. 631. TEMPORARY AUTHORITY TO ENTER INTO CONTRACTS.

       Section 331 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1981) is amended by adding at the end the 
     following:
       ``(d) Temporary Authority To Enter Into Contracts.--
       ``(1) Definitions.--In this subsection:
       ``(A) Eligible financial institution.--The term `eligible 
     financial institution' means a financial institution with 
     substantial experience in farm, ranch, or aquaculture lending 
     that is regulated by the Comptroller of the Currency, the 
     Farm Credit Administration, or a similar regulatory body.
       ``(B) Pilot project.--The term `pilot project' includes 
     services related to borrower loan documentation, financial 
     information, credit history, and appraisals of real estate 
     and chattel.
       ``(2) Authority.--The Secretary may enter into a contract 
     with an eligible financial institution for servicing a farmer 
     program loan under this title, including 1 or more pilot 
     projects.
       ``(3) Report.--Not later than September 30, 1997, and 
     September 30 of each year thereafter, the Secretary shall 
     report to Congress on--
       ``(A) the Secretary's experience in using contracts under 
     paragraph (2); and
       ``(B) recommendations for legislation related to this 
     subsection, if any.
       ``(4) Savings clause.--Nothing in this subsection shall 
     limit the authority of the Secretary or an eligible financial 
     institution to contract for any services under this Act or 
     any other law.
       ``(5) Sunset provision.--This subsection shall be effective 
     until September 30, 2002.''.

     SEC. 632. USE OF COLLECTION AGENCIES.

       Section 331 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1981) (as amended by section 631) is amended by 
     adding at the end the following:
       ``(e) Private Collection Agency.--The Secretary may use a 
     private collection agency to collect a claim or obligation 
     described in subsection (b)(5).''.

     SEC. 633. NOTICE OF LOAN SERVICE PROGRAMS.

       Section 331D(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1981d(a)) is amended by striking 
     ``180 days delinquent in'' and inserting ``90 days past due 
     on''.

     SEC. 634. CLARIFICATION OF WRITTEN STATEMENT REQUIRED OF 
                   BORROWERS.

       Section 333(1)(B) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1983(1)(B)) is amended by striking 
     ``a written statement showing the applicant's net worth'' and 
     inserting ``an appropriate written financial statement''.

     SEC. 635. ANNUAL REVIEW OF THE CREDIT HISTORY, BUSINESS 
                   OPERATION, AND CONTINUED ELIGIBILITY OF A 
                   BORROWER.

       (a) In General.--Section 333 of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 1983) is amended--
       (1) by redesignating paragraphs (2), (3), and (4) as 
     paragraphs (3), (4), and (5), respectively; and
       (2) by inserting after paragraph (1) the following:
       ``(2) except with respect to a loan under section 306, 
     310B, or 314, the county or area committee established under 
     section 8(b)(5)(B) of the Soil Conservation and Domestic 
     Allotment Act (16 U.S.C. 590h(b)(5)(B)) to certify in 
     writing--
       ``(A) that an annual review of the credit history and 
     business operation of the borrower has been conducted; and
       ``(B) that a review of the continued eligibility of the 
     borrower for the loan has been conducted;''.
       (b) Conforming Amendment.--The third sentence of section 
     310B(a) of the Consolidated Farm and Rural Development Act (7 
     U.S.C. 1932(a)) is amended by striking ``(3) of'' and 
     inserting ``(4) of''.

     SEC. 636. EXTENSION OF VETERANS PREFERENCE.

       Section 333 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1983) (as amended by section 635(a)) is amended 
     by striking paragraph (5) and inserting the following:
       ``(5) the application of a person who is a veteran of any 
     war, as defined in section 101(12) of title 38, United States 
     Code, for a loan under subtitle A or B to be given preference 
     over a similar application from a person who is not a veteran 
     of any war, if the applications are on file in a county or 
     area office at the same time.''.

     SEC. 637. VERIFICATION OF THE CREDIT ELSEWHERE TEST.

       Section 333A(f)(4) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1983a(f)(4)) is amended--
       (1) by striking ``(4) With'' and all that follows through 
     ``seasoned'' and inserting the following:
       ``(4) Verification.--
       ``(A) In general.--The Secretary shall provide a prospectus 
     of a seasoned''; and
       (2) by striking ``If the Secretary'' and inserting the 
     following:
       ``(B) Notification.--The Secretary shall notify each 
     borrower of a loan that a prospectus has been provided to a 
     lender under subparagraph (A).
       ``(C) Credit extended.--If the Secretary''.

     SEC. 638. SALE OF PROPERTY.

       Section 335 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1985) is amended--
       (1) in subsection (b), by striking ``subsection (e)'' and 
     inserting ``subsections (c) and (e)'';
       (2) by striking subsection (c) and inserting the following:
       ``(c) Sale of Property.--
       ``(1) In general.--Subject to this subsection and 
     subsection (e)(1)(A), the Secretary shall offer to sell real 
     property that is acquired by the Secretary under this title 
     using the following order and method of sale:
       ``(A) Advertisement.--Not later than 15 days after 
     acquiring real property, the Secretary shall publicly 
     advertise the property for sale.
       ``(B) Beginning farmer or rancher.--
       ``(i) In general.--Not later than 75 days after acquiring 
     real property, the Secretary shall offer to sell the property 
     to a qualified beginning farmer or rancher at current market 
     value based on a current appraisal.
       ``(ii) Random selection.--If more than 1 qualified 
     beginning farmer or rancher offers to purchase the property, 
     the Secretary shall select between the qualified applicants 
     on a random basis.
       ``(iii) Appeal of random selection.--A random selection or 
     denial by the Secretary of a beginning farmer or rancher for 
     farm inventory property under this subparagraph shall be 
     final and not administratively appealable.
       ``(C) Public sale.--If no acceptable offer is received from 
     a qualified beginning farmer or rancher under subparagraph 
     (B) not later than 75 days after acquiring the real property, 
     the Secretary shall, not later than 30 days after the 75-day 
     period, sell the property after public notice at a public 
     sale, and, if no acceptable bid is received, by negotiated 
     sale, at the best price obtainable.
       ``(2) Transitional rules.--
       ``(A) Previous lease.--In the case of real property 
     acquired prior to the date of enactment of this subparagraph 
     that the Secretary leased prior to the date of enactment of 
     this subparagraph, not later than 60 days after the lease 
     expires, the Secretary shall offer to sell the property in 
     accordance with paragraph (1).
       ``(B) Previously in inventory.--In the case of real 
     property acquired prior to the date of enactment of this 
     subparagraph that the Secretary has not leased, not later 
     than 60 days after the date of enactment of this 
     subparagraph, the Secretary shall offer to sell the property 
     in accordance with paragraph (1).
       ``(3) Interest.--
       ``(A) In general.--Subject to subparagraph (B), any 
     conveyance of real property under this subsection shall 
     include all of the interest of the United States in the 
     property, including mineral rights.
       ``(B) Conservation.--The Secretary may for conservation 
     purposes grant or sell an easement, restriction, development 
     right, or similar legal right to real property to a State, a 
     political subdivision of a State, or a private nonprofit 
     organization separately from the underlying fee or other 
     rights to the property owned by the United States.
       ``(4) Other law.--The Federal Property and Administrative 
     Services Act of 1949 (40 U.S.C. 471 et seq.) shall not apply 
     to any exercise of authority under this title.
       ``(5) Lease of property.--
       ``(A) In general.--Subject to subparagraph (B), the 
     Secretary may not lease any real property acquired under this 
     title.
       ``(B) Exception.--
       ``(i) Beginning farmer or rancher.--The Secretary may lease 
     or contract to sell to a beginning farmer or rancher a farm 
     or ranch acquired by the Secretary under this title if the 
     beginning farmer or rancher qualifies for a credit sale or 
     direct farm ownership loan under subtitle A but credit sale 
     authority for loans or direct farm ownership loan funds, 
     respectively, are not available.
       ``(ii) Term.--The term of a lease or contract to sell to a 
     beginning farmer or rancher under clause (i) shall be until 
     the earlier of--

       ``(I) the date that is 18 months after the date of the 
     lease or sale; or
       ``(II) the date that direct farm ownership loan funds or 
     credit sale authority for loans becomes available to the 
     beginning farmer or rancher.

       ``(iii) Income-producing capability.--In determining the 
     rental rate on real property leased under this subparagraph, 
     the Secretary shall

[[Page H2771]]

     consider the income-producing capability of the property 
     during the term that the property is leased.
       ``(6) Expedited determination.--
       ``(A) In general.--On the request of an applicant, not 
     later than 30 days after denial of the applicant's 
     application, the appropriate State director shall provide an 
     expedited review and determination of whether the applicant 
     is a beginning farmer or rancher for the purpose of acquiring 
     farm inventory property.
       ``(B) Appeal.--The determination of a State Director under 
     subparagraph (A) shall be final and not administratively 
     appealable.
       ``(C) Effects of determinations.--
       ``(i) In general.--The Secretary shall maintain statistical 
     data on the number and results of determinations made under 
     subparagraph (A) and the effect of the determinations on--

       ``(I) selling farm inventory property to beginning farmers 
     and ranchers; and
       ``(II) disposing of real property in inventory.

       ``(ii) Notification.--The Secretary shall notify the 
     Committee on Agriculture of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate if the Secretary determines that the review process 
     under subparagraph (A) is adversely affecting the selling of 
     farm inventory property to beginning farmers or ranchers or 
     the disposing of real property in inventory.''; and
       (3) in subsection (e)--
       (A) in paragraph (1)--
       (i) by striking subparagraphs (A) through (C);
       (ii) by redesignating subparagraphs (D) through (G) as 
     subparagraphs (A) through (D), respectively;
       (iii) in subparagraph (A) (as redesignated by clause 
     (ii))--

       (I) in clause (i)--

       (aa) in the matter preceding subclause (I), by striking 
     ``(G)'' and inserting ``(D)'';
       (bb) by striking subclause (I) and inserting the following:
       ``(I) the Secretary acquires property under this title that 
     is located within an Indian reservation; and'';
       (cc) in subclause (II), by striking ``, and'' at the end 
     and inserting a semicolon; and
       (dd) by striking subclause (III); and

       (II) in clause (iii), by striking ``The Secretary shall'' 
     and all that follows through ``of subparagraph (A),'' and 
     inserting ``Not later than 90 days after acquiring the 
     property, the Secretary shall''; and

       (iv) in subparagraph (D) (as redesignated by clause (ii))--

       (I) in clause (i), by striking ``(D)'' in the matter 
     following subclause (IV) and inserting ``(A)'';
       (II) in clause (iii)(I), by striking ``subparagraphs 
     (C)(i), (C)(ii), and (D)'' and inserting ``subparagraph 
     (A)''; and
       (III) by striking clause (v) and inserting the following:

       ``(v) Foreclosure procedures.--

       ``(I) Notice to borrower.--If an Indian borrower-owner does 
     not voluntarily convey to the Secretary real property 
     described in clause (i), not less than 30 days before a 
     foreclosure sale of the property, the Secretary shall provide 
     the Indian borrower-owner with the option of--

       ``(aa) requiring the Secretary to assign the loan and 
     security instruments to the Secretary of the Interior, if the 
     Secretary of the Interior agrees to an assignment releasing 
     the Secretary of Agriculture from all further responsibility 
     for collection of any amounts with regard to the loan secured 
     by the real property; or
       ``(bb) requiring the Secretary to assign the loan and 
     security instruments to the tribe having jurisdiction over 
     the reservation in which the real property is located, if the 
     tribe agrees to the assignment.

       ``(II) Notice to tribe.--If an Indian borrower-owner does 
     not voluntarily convey to the Secretary real property 
     described in clause (i), not less than 30 days before a 
     foreclosure sale of the property, the Secretary shall provide 
     written notice to the Indian tribe that has jurisdiction over 
     the reservation in which the real property is located of--

       ``(aa) the sale;
       ``(bb) the fair market value of the property; and
       ``(cc) the requirements of this subparagraph.

       ``(III) Assumed loans.--If an Indian tribe assumes a loan 
     under subclause (I)--

       ``(aa) the Secretary shall not foreclose the loan because 
     of any default that occurred prior to the date of the 
     assumption;
       ``(bb) the loan shall be for the lesser of the outstanding 
     principal and interest of the loan or the fair market value 
     of the property; and
       ``(cc) the loan shall be treated as though the loan was 
     made under Public Law 91-229 (25 U.S.C. 488 et seq.).'';
       (B) by striking paragraph (3);
       (C) in paragraph (4)--
       (i) by striking subparagraph (B);
       (ii) in subparagraph (A)--

       (I) in clause (i), by striking ``(i)''; and
       (II) by redesignating clause (ii) as subparagraph (B); and

       (iii) in subparagraph (B) (as redesignated by clause 
     (ii)(II)), by striking ``clause (i)'' and inserting 
     ``subparagraph (A)'';
       (D) by striking paragraphs (5), (6), and (9); and
       (E) by redesignating paragraphs (4), (7), (8), and (10) as 
     paragraphs (3), (4), (5), and (6), respectively.

     SEC. 639. EASEMENTS ON INVENTORIED PROPERTY.

       Section 335(g) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1985(g)) is amended--
       (1) in paragraph (1)--
       (A) by striking ``(g)(1) Subject to paragraphs (2) through 
     (5)'' and inserting the following:
       ``(g) Easements on Inventoried Property.--
       ``(1) In general.--Subject to paragraph (2)''; and
       (B) by striking ``, as determined'' and all that follows 
     through ``3801 et seq.)'';
       (2) by striking paragraph (2) and inserting the following:
       ``(2) Limitation.--The Secretary shall not establish a 
     wetland conservation easement on an inventoried property 
     that--
       ``(A) was cropland on the date the property entered the 
     inventory of the Secretary; or
       ``(B) was used for farming at any time during the period 
     beginning on the date 5 years before the property entered the 
     inventory of the Secretary and ending on the date the 
     property entered the inventory of the Secretary.'';
       (3) by striking paragraphs (3), (4), (5), and (8);
       (4) by striking ``(6) The Secretary'' and inserting the 
     following:
       ``(3) Notification.--The Secretary''; and
       (5) by striking ``(7) The appraised'' and inserting the 
     following:
       ``(4) Appraised value.--The appraised''.

     SEC. 640. DEFINITIONS.

       Section 343(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1991(a)) is amended--
       (1) in paragraph (11)--
       (A) in the text preceding subparagraph (A), by striking 
     ``applicant--'' and inserting ``applicant, regardless of 
     whether the applicant is participating in a program under 
     section 310E--''; and
       (B) in subparagraph (F)--
       (i) by striking ``15 percent'' and inserting ``25 
     percent''; and
       (ii) by inserting before the semicolon at the end the 
     following: ``, except that this subparagraph shall not apply 
     to a loan made or guaranteed under subtitle B''; and
       (2) by adding at the end the following:
       ``(12) Debt forgiveness.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the term `debt forgiveness' means reducing or terminating a 
     farmer program loan made or guaranteed under this title, in a 
     manner that results in a loss to the Secretary, through--
       ``(i) writing down or writing off a loan under section 353;
       ``(ii) compromising, adjusting, reducing, or charging-off a 
     debt or claim under section 331;
       ``(iii) paying a loss on a guaranteed loan under section 
     357; or
       ``(iv) discharging a debt as a result of bankruptcy.
       ``(B) Loan restructuring.--The term `debt forgiveness' does 
     not include consolidation, rescheduling, reamortization, or 
     deferral.''.

     SEC. 641. AUTHORIZATION FOR LOANS.

       Section 346 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1994) is amended--
       (1) in the second sentence of subsection (a), by striking 
     ``with or without'' and all that follows through 
     ``administration''; and
       (2) by striking subsection (b) and inserting the following:
       ``(b) Authorization for Loans.--
       ``(1) In general.--The Secretary may make or guarantee 
     loans under subtitles A and B from the Agricultural Credit 
     Insurance Fund provided for in section 309 in not more than 
     the following amounts:
       ``(A) Fiscal year 1996.--For fiscal year 1996, 
     $3,085,000,000, of which--
       ``(i) $585,000,000 shall be for direct loans, of which--

       ``(I) $85,000,000 shall be for farm ownership loans under 
     subtitle A; and
       ``(II) $500,000,000 shall be for operating loans under 
     subtitle B; and

       ``(ii) $2,500,000,000 shall be for guaranteed loans, of 
     which--

       ``(I) $600,000,000 shall be for guarantees of farm 
     ownership loans under subtitle A; and
       ``(II) $1,900,000,000 shall be for guarantees of operating 
     loans under subtitle B.

       ``(B) Fiscal year 1997.--For fiscal year 1997, 
     $3,165,000,000, of which--
       ``(i) $585,000,000 shall be for direct loans, of which--

       ``(I) $85,000,000 shall be for farm ownership loans under 
     subtitle A; and
       ``(II) $500,000,000 shall be for operating loans under 
     subtitle B; and

       ``(ii) $2,580,000,000 shall be for guaranteed loans, of 
     which--

       ``(I) $630,000,000 shall be for guarantees of farm 
     ownership loans under subtitle A; and
       ``(II) $1,950,000,000 shall be for guarantees of operating 
     loans under subtitle B.

       ``(C) Fiscal year 1998.--For fiscal year 1998, 
     $3,245,000,000, of which--
       ``(i) $585,000,000 shall be for direct loans, of which--

       ``(I) $85,000,000 shall be for farm ownership loans under 
     subtitle A; and
       ``(II) $500,000,000 shall be for operating loans under 
     subtitle B; and

       ``(ii) $2,660,000,000 shall be for guaranteed loans, of 
     which--

       ``(I) $660,000,000 shall be for guarantees of farm 
     ownership loans under subtitle A; and
       ``(II) $2,000,000,000 shall be for guarantees of operating 
     loans under subtitle B.

       ``(D) Fiscal year 1999.--For fiscal year 1999, 
     $3,325,000,000, of which--
       ``(i) $585,000,000 shall be for direct loans, of which--

       ``(I) $85,000,000 shall be for farm ownership loans under 
     subtitle A; and
       ``(II) $500,000,000 shall be for operating loans under 
     subtitle B; and

       ``(ii) $2,740,000,000 shall be for guaranteed loans, of 
     which--

       ``(I) $690,000,000 shall be for guarantees of farm 
     ownership loans under subtitle A; and
       ``(II) $2,050,000,000 shall be for guarantees of operating 
     loans under subtitle B.

       ``(E) Fiscal year 2000.--For fiscal year 2000, 
     $3,435,000,000, of which--

[[Page H2772]]

       ``(i) $585,000,000 shall be for direct loans, of which--

       ``(I) $85,000,000 shall be for farm ownership loans under 
     subtitle A; and
       ``(II) $500,000,000 shall be for operating loans under 
     subtitle B; and

       ``(ii) $2,850,000,000 shall be for guaranteed loans, of 
     which--

       ``(I) $750,000,000 shall be for guarantees of farm 
     ownership loans under subtitle A; and
       ``(II) $2,100,000,000 shall be for guarantees of operating 
     loans under subtitle B.

       ``(F) Fiscal year 2001.--For fiscal year 2001, 
     $3,435,000,000, of which--
       ``(i) $585,000,000 shall be for direct loans, of which--

       ``(I) $85,000,000 shall be for farm ownership loans under 
     subtitle A; and
       ``(II) $500,000,000 shall be for operating loans under 
     subtitle B; and

       ``(ii) $2,850,000,000 shall be for guaranteed loans, of 
     which--

       ``(I) $750,000,000 shall be for guarantees of farm 
     ownership loans under subtitle A; and
       ``(II) $2,100,000,000 shall be for guarantees of operating 
     loans under subtitle B.

       ``(G) Fiscal year 2002.--For fiscal year 2002, 
     $3,435,000,000, of which--
       ``(i) $585,000,000 shall be for direct loans, of which--

       ``(I) $85,000,000 shall be for farm ownership loans under 
     subtitle A; and
       ``(II) $500,000,000 shall be for operating loans under 
     subtitle B; and

       ``(ii) $2,850,000,000 shall be for guaranteed loans, of 
     which--

       ``(I) $750,000,000 shall be for guarantees of farm 
     ownership loans under subtitle A; and
       ``(II) $2,100,000,000 shall be for guarantees of operating 
     loans under subtitle B.

       ``(2) Beginning farmers and ranchers.--
       ``(A) Direct loans.--
       ``(i) Farm ownership loans.--

       ``(I) In general.--Of the amounts made available under 
     paragraph (1) for direct farm ownership loans, the Secretary 
     shall reserve 70 percent for qualified beginning farmers and 
     ranchers.
       ``(II) Down payment loans.--Of the amounts reserved for a 
     fiscal year under subclause (I), the Secretary shall reserve 
     60 percent for the down payment loan program under section 
     310E until April 1 of the fiscal year.

       ``(ii) Operating loans.--Of the amounts made available 
     under paragraph (1) for direct operating loans, the Secretary 
     shall reserve for qualified beginning farmers and ranchers--

       ``(I) for each of fiscal years 1996 through 1998, 25 
     percent;
       ``(II) for fiscal year 1999, 30 percent; and
       ``(III) for each of fiscal years 2000 through 2002, 35 
     percent.

       ``(iii) Funds reserved until september 1.--Except as 
     provided in clause (i)(II), funds reserved for qualified 
     beginning farmers or ranchers under this subparagraph for a 
     fiscal year shall be reserved only until September 1 of the 
     fiscal year.
       ``(B) Guaranteed loans.--
       ``(i) Farm ownership loans.--Of the amounts made available 
     under paragraph (1) for guarantees of farm ownership loans, 
     the Secretary shall reserve 25 percent for qualified 
     beginning farmers and ranchers.
       ``(ii) Operating loans.--Of the amounts made available 
     under paragraph (1) for guarantees of operating loans, the 
     Secretary shall reserve 40 percent for qualified beginning 
     farmers and ranchers.
       ``(iii) Funds reserved until april 1.--Funds reserved for 
     qualified beginning farmers or ranchers under this 
     subparagraph for a fiscal year shall be reserved only until 
     April 1 of the fiscal year.
       ``(C) Reserved funds for all qualified beginning farmers 
     and ranchers.--If a qualified beginning farmer or rancher 
     meets the eligibility criteria for receiving a direct or 
     guaranteed loan under section 302, 310E, or 311, the 
     Secretary shall make or guarantee the loan if sufficient 
     funds reserved under this paragraph are available to make or 
     guarantee the loan.
       ``(3) Transfer for down payment loans.--
       ``(A) In general.--Notwithstanding subsection (a), subject 
     to subparagraph (B)--
       ``(i) beginning on August 1 of each fiscal year, the 
     Secretary shall use available unsubsidized guaranteed farm 
     operating loan funds to provide direct farm ownership loans 
     approved by the Secretary to qualified beginning farmers and 
     ranchers under the down payment loan program established 
     under section 310E, if sufficient direct farm ownership loan 
     funds are not otherwise available; and
       ``(ii) beginning on September 1 of each fiscal year, the 
     Secretary shall use available unsubsidized guaranteed farm 
     operating loan funds to provide direct farm ownership loans 
     approved by the Secretary to qualified beginning farmers and 
     ranchers, if sufficient direct farm ownership loan funds are 
     not otherwise available.
       ``(B) Limitation.--The Secretary shall limit the transfer 
     of funds under subparagraph (A) so that all guaranteed farm 
     operating loans that have been approved, or will be approved, 
     by the Secretary during the fiscal year will be made to the 
     extent of available amounts.
       ``(4) Transfer for credit sales of farm inventory 
     property.--
       ``(A) In general.--Notwithstanding subsection (a), subject 
     to subparagraphs (B) and (C), beginning on September 1 of 
     each fiscal year, the Secretary may use available funds made 
     available under subtitle C for the fiscal year to fund the 
     credit sale of farm real estate in the inventory of the 
     Secretary.
       ``(B) Supplemental appropriations.--The transfer authority 
     provided under subparagraph (A) shall not apply to any funds 
     made available to the Secretary for any fiscal year under an 
     Act making supplemental appropriations.
       ``(C) Limitation.--The Secretary shall limit the transfer 
     of funds under subparagraph (A) so that all emergency 
     disaster loans that have been approved, or will be approved, 
     by the Secretary during the fiscal year will be made to the 
     extent of available amounts.''.

     SEC. 642. CONTRACTS ON LOAN SECURITY PROPERTIES.

       Section 349 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1997) is amended--
       (1) by striking subsection (b) and inserting the following:
       ``(b) Contracts on Loan Security Properties.--Subject to 
     subsection (c), the Secretary may enter into a contract 
     related to real property for conservation, recreation, or 
     wildlife purposes.'';
       (2) in subsection (c)--
       (A) by striking ``(c) Such easement'' and all that follows 
     through ``if--'' and inserting the following:
       ``(c) Limitations.--The Secretary may enter into a contract 
     under subsection (b) if--'';
       (B) in paragraph (2), by adding ``and'' at the end;
       (C) in paragraph (3)--
       (i) by striking subparagraph (B);
       (ii) by striking ``(3)(A)(i)'' and inserting ``(3)(A)'';
       (iii) by striking ``Farmers Home Administration'' and 
     inserting ``Secretary'';
       (iv) by striking ``(ii) such easement'' and inserting ``(B) 
     such contract''; and
       (v) by striking ``; or'' and inserting a period; and
       (D) by striking paragraph (4);
       (3) in subsection (d), by striking ``easement'' each place 
     it appears and inserting ``contract'';
       (4) in subsection (e)--
       (A) in paragraph (1)--
       (i) in the matter preceding subparagraph (A), by striking 
     ``purchase any such easement from the borrower--'' and 
     inserting ``reduce or forgive the outstanding debt of a 
     borrower--'';
       (ii) by striking ``easement'' each place it appears and 
     inserting ``contract''; and
       (iii) by striking ``Farmers Home Administration'' each 
     place it appears and inserting ``Secretary''; and
       (B) in paragraph (2)(A), by striking ``easement is 
     acquired'' and inserting ``contract is entered into'';
       (5) in subsection (f)--
       (A) in paragraph (1), by striking ``acquire easements'' and 
     inserting ``enter into contracts''; and
       (B) in paragraphs (2) and (3), by striking ``easements'' 
     each place it appears and inserting ``contracts''; and
       (6) in subsection (g), by striking ``an easement acquired'' 
     and inserting ``a contract entered into''.

     SEC. 643. LIST OF CERTIFIED LENDERS AND INVENTORY PROPERTY 
                   DEMONSTRATION PROJECT.

       (a) In General.--Section 351 of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 1999) is amended--
       (1) in subsection (f)--
       (A) by striking ``Each Farmers Home Administration county 
     supervisor'' and inserting ``The Secretary'';
       (B) by striking ``approved lenders'' and inserting 
     ``lenders''; and
       (C) by striking ``the Farmers Home Administration''; and
       (2) by striking subsection (h).
       (b) Technical Amendment.--Section 1320 of the Food Security 
     Act of 1985 (Public Law 99-198; 7 U.S.C. 1999 note) is 
     amended by striking ``Effective only'' and all that follows 
     through ``1995, the'' and inserting ``The''.

     SEC. 644. HOMESTEAD PROPERTY.

       Section 352(c) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 2000(c)) is amended--
       (1) in paragraph (1)(A), by striking ``90'' each place it 
     appears and inserting ``30''; and
       (2) in paragraph (6)--
       (A) in the first sentence, by striking ``Within 30'' and 
     all that follows through ``title,'' and insert ``Not later 
     than the date of acquisition of the property securing a loan 
     made under this title (or, in the case of real property in 
     inventory on the date of enactment of the Federal Agriculture 
     Improvement and Reform Act of 1996, not later than 5 days 
     after the date of enactment of the Act),''; and
       (B) by striking the second sentence.

     SEC. 645. RESTRUCTURING.

       Section 353 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 2001) is amended--
       (1) in subsection (c)--
       (A) in paragraph (3), by striking subparagraph (C) and 
     inserting the following:
       ``(C) Cash flow margin.--For the purpose of assessing under 
     subparagraph (A) the ability of a borrower to meet debt 
     obligations and continue farming operations, the Secretary 
     shall assume that the borrower needs up to 110 percent of the 
     amount indicated for payment of farm operating expenses, debt 
     service obligations, and family living expenses.''; and
       (B) by striking paragraph (6) and inserting the following:
       ``(6) Termination of loan obligations.--The obligations of 
     a borrower to the Secretary under a loan shall terminate if--
       ``(A) the borrower satisfies the requirements of paragraphs 
     (1) and (2) of subsection (b);
       ``(B) the value of the restructured loan is less than the 
     recovery value; and
       ``(C) not later than 90 days after receipt of the 
     notification described in paragraph (4)(B), the borrower pays 
     (or obtains third-party financing to pay) the Secretary an 
     amount equal to the current market value.'';
       (2) by striking subsection (k); and
       (3) by redesignating subsections (l) through (p) as 
     subsections (k) through (o), respectively.

[[Page H2773]]

     SEC. 646. TRANSFER OF INVENTORY LAND FOR CONSERVATION 
                   PURPOSES.

       Section 354 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 2002) is amended--
       (1) in the matter preceding paragraph (1), by striking 
     ``The Secretary, without reimbursement,'' and inserting the 
     following:
       ``(a) In General.--Subject to subsection (b), the 
     Secretary'';
       (2) by striking paragraph (2) and inserting the following:
       ``(2) that is eligible to be disposed of in accordance with 
     section 335; and''; and
       (3) by adding at the end the following:
       ``(b) Conditions.--The Secretary may not transfer any 
     property or interest in property under subsection (a) 
     unless--
       ``(1) at least 2 public notices are given of the transfer;
       ``(2) if requested, at least 1 public meeting is held prior 
     to the transfer; and
       ``(3) the Governor and at least 1 elected county official 
     of the State and county where the property is located are 
     consulted prior to the transfer.''.

     SEC. 647. IMPLEMENTATION OF TARGET PARTICIPATION RATES.

       Section 355 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 2003) is amended by adding at the end the 
     following:
       ``(f) Implementation Consistent With Supreme Court 
     Holding.--Not later than 180 days after the date of enactment 
     of this subsection, the Secretary shall ensure that the 
     implementation of this section is consistent with the holding 
     of the Supreme Court in Adarand Constructors, Inc. v. 
     Federico Pena, Secretary of Transportation, 115 S. Ct. 2097 
     (1995).''.

     SEC. 648. DELINQUENT BORROWERS.

       (a) Payment of Interest as a Condition of Loan Servicing 
     for Borrowers.--The Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1921 et seq.) is amended by adding at the end 
     the following:

     ``SEC. 372. PAYMENT OF INTEREST AS A CONDITION OF LOAN 
                   SERVICING FOR BORROWERS.

       ``The Secretary may not reschedule or reamortize a loan for 
     a borrower under this title who has not requested 
     consideration under section 331D(e) unless the borrower pays 
     a portion, as determined by the Secretary, of the interest 
     due on the loan.''.
       (b) Loan and Loan Servicing Limitations.--The Consolidated 
     Farm and Rural Development Act (7 U.S.C. 1921 et seq.) (as 
     amended by subsection (a)) is amended by adding at the end 
     the following:

     ``SEC. 373. LOAN AND LOAN SERVICING LIMITATIONS.

       ``(a) Delinquent Borrowers Prohibited From Obtaining Direct 
     Operating Loans.--The Secretary may not make a direct 
     operating loan under subtitle B to a borrower who is 
     delinquent on any loan made or guaranteed under this title.
       ``(b) Loans Prohibited for Borrowers That Have Received 
     Debt Forgiveness.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     Secretary may not make or guarantee a loan under this title 
     to a borrower who received debt forgiveness on a loan made or 
     guaranteed under this title.
       ``(2) Exception.--The Secretary may make a direct or 
     guaranteed farm operating loan for paying annual farm or 
     ranch operating expenses of a borrower who was restructured 
     with a write-down under section 353.
       ``(c) No More Than 1 Debt Forgiveness For A Borrower On A 
     Direct Loan.--The Secretary may not provide to a borrower 
     debt forgiveness on a direct loan made under this title if 
     the borrower has received debt forgiveness on another direct 
     loan made under this title.''.

     SEC. 649. SHORT FORM CERTIFICATION OF FARM PROGRAM BORROWER 
                   COMPLIANCE.

       The Consolidated Farm and Rural Development Act (7 U.S.C. 
     1921 et seq.) (as amended by section 648) is amended by 
     adding at the end the following:

     ``SEC. 374. SHORT FORM CERTIFICATION OF FARM PROGRAM BORROWER 
                   COMPLIANCE.

       ``The Secretary shall develop and utilize a consolidated 
     short form for farm program borrowers to use in certifying 
     compliance with any applicable provision of law (including a 
     regulation) that serves as an eligibility prerequisite for a 
     loan made under this title.''.

     SEC. 650. CREDIT STUDY.

       (a) In General.--The Secretary of Agriculture shall conduct 
     a study and report to the Committee on Agriculture of the 
     House of Representatives and the Committee on Agriculture, 
     Nutrition, and Forestry of the Senate on the demand for and 
     availability of credit in rural areas for agriculture, 
     housing, and rural development.
       (b) Purpose.--The purpose of the study shall be to ensure 
     that Congress has current and comprehensive information to 
     consider as Congress deliberates on rural credit needs and 
     the availability of credit to satisfy the needs of rural 
     areas of the United States.
       (c) Items in Study.--In conducting the study, the Secretary 
     shall base the study on the most current available data and 
     analyze--
       (1) rural demand for credit from the Farm Credit System, 
     the ability of the Farm Credit System to meet the demand, and 
     the extent to which the Farm Credit System provides loans to 
     satisfy the demand;
       (2) rural demand for credit from the United States banking 
     system, the ability of banks to meet the demand, and the 
     extent to which banks provide loans to satisfy the demand;
       (3) rural demand for credit from the Secretary, the ability 
     of the Secretary to meet the demand, and the extent to which 
     the Secretary provides loans to satisfy the demand;
       (4) rural demand for credit from other Federal agencies, 
     the ability of the agencies to meet the demand, and the 
     extent to which the agencies provide loans to satisfy the 
     demand;
       (5) what measure or measures exist to gauge the overall 
     demand for rural credit, the extent to which rural demand for 
     credit is satisfied, and what the measures have demonstrated;
       (6) a comparison of the interest rates and terms charged by 
     the Farm Credit System Farm Credit Banks, production credit 
     associations, and banks for cooperatives with the rates and 
     terms charged by the banks of the United States for credit of 
     comparable risk and maturity;
       (7) the advantages and disadvantages of the modernization 
     and expansion proposals of the Farm Credit System on the Farm 
     Credit System, the United States banking system, rural users 
     of credit, local rural communities, and the Federal 
     Government, including--
       (A) any added risk to the safety and soundness of the Farm 
     Credit System that may result from approval of a proposal; 
     and
       (B) any positive or adverse impacts on competition between 
     the Farm Credit System and the banks of the United States in 
     providing credit to rural users;
       (8) the nature and extent of the unsatisfied rural credit 
     need that the Farm Credit System proposals are supposed to 
     address and what aspects of the present Farm Credit System 
     prevent the Farm Credit System from meeting the need;
       (9) the advantages and disadvantages of the proposal by 
     commercial bankers to allow banks access to the Farm Credit 
     System as a funding source on the Farm Credit System, the 
     United States banking system, rural users of credit, local 
     rural communities, and the Federal Government, including--
       (A) any added risk to the safety and soundness of the Farm 
     Credit System that may result from approval of the proposal; 
     and
       (B) any positive or adverse impacts on competition between 
     the Farm Credit System and the banks of the United States in 
     providing credit to rural users; and
       (10) problems that commercial banks have in obtaining 
     capital for lending in rural areas, how access to Farm Credit 
     System funds would improve the availability of capital in 
     rural areas in ways that cannot be achieved in the system in 
     existence on the date of enactment of this Act, and the 
     possible effects on the viability of the Farm Credit System 
     of granting banks access to Farm Credit System funds.
       (d) Interagency Task Force.--In completing the study, the 
     Secretary shall use, among other things, data and information 
     obtained by the interagency task force on rural credit.
                     Subtitle E--General Provisions

     SEC. 661. CONFORMING AMENDMENTS.

       (a) Section 307(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1927(a)) is amended--
       (1) in paragraph (4), by striking ``304(b), 306(a)(1), and 
     310B'' and inserting ``306(a)(1) and 310B''; and
       (2) in paragraph (6)(B)--
       (A) by striking clauses (i), (ii), (iv), and (vii);
       (B) in clause (v), by adding ``and'' at the end;
       (C) in clause (vi), by striking ``, and'' at the end and 
     inserting a period; and
       (D) by redesignating clauses (iii), (v), and (vi) as 
     clauses (i), (ii), and (iii), respectively.
       (b) The second sentence of section 309(g)(1) of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 
     1929(g)(1)) is amended by striking ``section 308,''.
       (c) Section 309A of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1929a) is amended--
       (1) in the second sentence of subsection (a), by striking 
     ``304(b), 306(a)(1), 306(a)(14), 310B, and 312(b)'' and 
     inserting ``306(a)(1), 306(a)(14), and 310B''; and
       (2) in the first sentence of subsection (b), by striking 
     ``and section 308''.
       (d) Section 310B(d) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1932(d)) is amended--
       (1) by striking ``sections 304(b), 310B, and 312(b)'' each 
     place it appears in paragraphs (2), (3), and (4) and 
     inserting ``this section''; and
       (2) in paragraph (6), by striking ``this section, section 
     304, or section 312'' and inserting ``this section''.
       (e) The first sentence of section 310D(a) of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 
     1934(a)) is amended by striking ``paragraphs (1) through (5) 
     of section 303(a), or subparagraphs (A) through (E) of 
     section 304(a)(1)'' and inserting ``section 303(a), or 
     paragraphs (1) through (5) of section 304(a)''.
       (f) Section 311(b)(1) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1941(b)(1)) is amended by striking 
     ``and for the purposes specified in section 312''.
       (g) Section 316(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1946(a)) is amended by striking 
     paragraph (3).
       (h) Section 343 of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1991) is amended--
       (1) in subsection (a)(10), by striking ``recreation loan 
     (RL) under section 304,''; and
       (2) in subsection (b)--
       (A) in the matter preceding paragraph (1), by striking 
     ``351(h),''; and
       (B) by striking paragraph (4) and inserting the following:
       ``(4) Preservation loan service program.--The term 
     ``preservation loan service program'' means homestead 
     retention as authorized under section 352.''.
       (i) The first sentence of section 344 of the Consolidated 
     Farm and Rural Development Act (7 U.S.C. 1992) is amended by 
     striking ``304(b), 306(a)(1), 310B, 312(b), or 312(c)'' and 
     inserting ``306(a)(1), 310B, or 312(c)''.
       (j) Section 353(l) of the Consolidated Farm and Rural 
     Development Act (as redesignated by section 645(3)) is 
     amended by striking ``and subparagraphs (A)(i) and (C)(i) of 
     section 335(e)(1),''.

[[Page H2774]]

     SEC. 662. ELECTRONIC FILING OF EFFECTIVE FINANCING STATEMENTS 
                   UNDER THE CLEAR TITLE PROVISIONS OF THE FOOD 
                   SECURITY ACT OF 1985.

       Section 1324(c)(4) of the Food Security Act of 1985 (7 
     U.S.C. 1631(c)(4)) is amended--
       (1) in subparagraph (A), by striking ``thereof'' and 
     inserting ``of the statement, or, in the case of a State 
     which (under the applicable State law provisions of the 
     Uniform Commercial Code) allows the electronic filing of 
     financing statements without the signature of the debtor, is 
     an electronically reproduced copy of the statement''; and
       (2) in each of subparagraphs (B) and (C), by inserting 
     ``other than in the case of an electronically reproduced copy 
     of the statement,'' before ``is''.

     SEC. 663. EFFECTIVE DATE.

       (a) In General.--Except as provided in subsection (b), the 
     amendments made by this title shall become effective on the 
     date of enactment of this Act.
       (b) Delayed Effective Dates.--The amendments made by 
     sections 601, 606, 611, 612, 622, 623, 625, 633, 640(1), 642, 
     645(1), 648(a), and 649 shall become effective 90 days after 
     the date of enactment of this Act.
       (c) Transition Provision.--The amendments made by sections 
     638 and 644 shall not apply with respect to a complete 
     application to acquire inventory property submitted prior to 
     the date of enactment of this Act.
       (d) Regulations.--Notwithstanding any other provision of 
     law, regulations to implement the amendments made by this 
     title shall be published as interim final rules with request 
     for comments and may be made effective immediately on 
     publication.
                      TITLE VII--RURAL DEVELOPMENT
  Subtitle A--Amendments to the Food, Agriculture, Conservation, and 
                           Trade Act of 1990

                     CHAPTER 1--GENERAL PROVISIONS

     SEC. 701. RURAL INVESTMENT PARTNERSHIPS.

       Subtitle B of title XXIII of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 2007 et seq.) 
     is repealed.

     SEC. 702. WATER AND WASTE FACILITY FINANCING.

       Section 2322 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 1926-1) is repealed.

     SEC. 703. RURAL WASTEWATER CIRCUIT RIDER PROGRAM.

       Section 2324 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (Public Law 101-624; 7 U.S.C. 1926 note) is 
     repealed.

     SEC. 704. TELEMEDICINE AND DISTANCE LEARNING SERVICES IN 
                   RURAL AREAS.

       Chapter 1 of subtitle D of title XXIII of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     950aaa et seq.) is amended to read as follows:

``CHAPTER 1--TELEMEDICINE AND DISTANCE LEARNING SERVICES IN RURAL AREAS

     ``SEC. 2331. PURPOSE.

       ``The purpose of this chapter is to encourage and improve 
     telemedicine services and distance learning services in rural 
     areas through the use of telecommunications, computer 
     networks, and related advanced technologies by students, 
     teachers, medical professionals, and rural residents.

     ``SEC. 2332. DEFINITIONS.

       ``In this chapter:
       ``(1) Construct.--The term `construct' means to construct, 
     acquire, install, improve, or extend a facility or system.
       ``(2) Cost of money loan.--The term `cost of money loan' 
     means a loan made under this chapter bearing interest at a 
     rate equal to the then current cost to the Federal Government 
     of loans of similar maturity.
       ``(3) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture.

     ``SEC. 2333. TELEMEDICINE AND DISTANCE LEARNING SERVICES IN 
                   RURAL AREAS.

       ``(a) Services to Rural Areas.--The Secretary may provide 
     financial assistance for the purpose of financing the 
     construction of facilities and systems to provide 
     telemedicine services and distance learning services in rural 
     areas.
       ``(b) Financial Assistance.--
       ``(1) In general.--Financial assistance shall consist of 
     grants or cost of money loans, or both.
       ``(2) Form.--The Secretary shall determine the portion of 
     the financial assistance provided to a recipient that 
     consists of grants and the portion that consists of cost of 
     money loans so as to result in the maximum feasible repayment 
     to the Federal Government of the financial assistance, based 
     on the ability to repay of the recipient and full utilization 
     of funds made available to carry out this chapter.
       ``(c) Recipients.--
       ``(1) In general.--The Secretary may provide financial 
     assistance under this chapter to--
       ``(A) entities using telemedicine services or distance 
     learning services; and
       ``(B) entities providing or proposing to provide 
     telemedicine service or distance learning service to other 
     persons at rates calculated to ensure that the benefit of the 
     financial assistance is passed through to the other persons.
       ``(2) Electric or telecommunications borrowers.--
       ``(A) Loans to borrowers.--Subject to subparagraph (B), the 
     Secretary may provide a cost of money loan under this chapter 
     to a borrower of an electric or telecommunications loan under 
     the Rural Electrification Act of 1936 (7 U.S.C. 901 et seq.). 
     A borrower receiving a cost of money loan under this 
     paragraph shall--
       ``(i) make the funds provided available to entities that 
     qualify under paragraph (1) for projects satisfying the 
     requirements of this chapter;
       ``(ii) use the funds provided to acquire, install, improve, 
     or extend a system referred to in subsection (a); or
       ``(iii) use the funds provided to install, improve, or 
     extend a facility referred to in subsection (a).
       ``(B) Limitations.--A borrower of an electric or 
     telecommunications loan under the Rural Electrification Act 
     of 1936 shall--
       ``(i) make a system or facility funded under subparagraph 
     (A) available to entities that qualify under paragraph (1); 
     and
       ``(ii) neither retain from the proceeds of a loan provided 
     under subparagraph (A), nor assess a qualifying entity under 
     paragraph (1), any amount except as may be required to pay 
     the actual costs incurred in administering the loan or making 
     the system or facility available.
       ``(3) Appeal.--If the Secretary rejects the application of 
     a borrower who applies for a cost of money loan or grant 
     under this section, the borrower may appeal the decision to 
     the Secretary not later than 10 days after the borrower is 
     notified of the rejection.
       ``(4) Assistance to provide or improve services.--Financial 
     assistance may be provided under this chapter for a facility 
     regardless of the location of the facility if the Secretary 
     determines that the assistance is necessary to provide or 
     improve telemedicine services or distance learning services 
     in a rural area.
       ``(d) Priority.--The Secretary shall establish procedures 
     to prioritize financial assistance under this chapter 
     considering--
       ``(1) the need for the assistance in the affected rural 
     area;
       ``(2) the financial need of the applicant;
       ``(3) the population sparsity of the affected rural area;
       ``(4) the local involvement in the project serving the 
     affected rural area;
       ``(5) geographic diversity among the recipients of 
     financial assistance;
       ``(6) the utilization of the telecommunications facilities 
     of any telecommunications provider serving the affected rural 
     area;
       ``(7) the portion of total project financing provided by 
     the applicant from the funds of the applicant;
       ``(8) the portion of project financing provided by the 
     applicant with funds obtained from non-Federal sources;
       ``(9) the joint utilization of facilities financed by other 
     financial assistance;
       ``(10) the coordination of the proposed project with 
     regional projects or networks;
       ``(11) service to the greatest practical number of persons 
     within the general geographic area covered by the financial 
     assistance;
       ``(12) conformity with the State strategic plan as prepared 
     under section 381D of the Consolidated Farm and Rural 
     Development Act; and
       ``(13) other factors determined appropriate by the 
     Secretary.
       ``(e) Maximum Amount of Assistance to Individual 
     Recipients.--The Secretary may establish the maximum amount 
     of financial assistance to be made available to an individual 
     recipient for each fiscal year under this chapter, by 
     publishing notice of the maximum amount in the Federal 
     Register not more than 45 days after funds are made available 
     for the fiscal year to carry out this chapter.
       ``(f) Use of Funds.--Financial assistance provided under 
     this chapter shall be used for--
       ``(1) the development and acquisition of instructional 
     programming;
       ``(2) the development and acquisition, through lease or 
     purchase, of computer hardware and software, audio and visual 
     equipment, computer network components, telecommunications 
     terminal equipment, telecommunications transmission 
     facilities, data terminal equipment, or interactive video 
     equipment, or other facilities that would further 
     telemedicine services or distance learning services;
       ``(3) providing technical assistance and instruction for 
     the development or use of the programming, equipment, or 
     facilities referred to in paragraphs (1) and (2); or
       ``(4) other uses that are consistent with this chapter, as 
     determined by the Secretary.
       ``(g) Salaries and Expenses.--Notwithstanding subsection 
     (f), financial assistance provided under this chapter shall 
     not be used for paying salaries or administrative expenses.
       ``(h) Expediting Coordinated Telephone Loans.--
       ``(1) In general.--The Secretary may establish and carry 
     out procedures to ensure that expedited consideration and 
     determination is given to applications for loans and advances 
     of funds submitted by local exchange carriers under this 
     chapter and the Rural Electrification Act of 1936 (7 U.S.C. 
     901 et seq.) to enable the exchange carriers to provide 
     advanced telecommunications services in rural areas in 
     conjunction with any other projects carried out under this 
     chapter.
       ``(2) Deadline imposed on secretary.--Not later than 45 
     days after the receipt of a completed application for an 
     expedited telephone loan under paragraph (1), the Secretary 
     shall notify the applicant in writing of the decision of the 
     Secretary regarding the application.
       ``(i) Notification of Local Exchange Carrier.--
       ``(1) Applicants.--Each applicant for a grant for a 
     telemedicine or distance learning project established under 
     this chapter shall notify the appropriate local telephone 
     exchange carrier regarding the application filed with the 
     Secretary for the grant.
       ``(2) Secretary.--The Secretary shall--
       ``(A) publish notice of applications received for grants 
     under this chapter for telemedicine or distance learning 
     projects; and
       ``(B) make the applications available for inspection.

     ``SEC. 2334. ADMINISTRATION.

       ``(a) Nonduplication.--The Secretary shall ensure that 
     facilities constructed using financial

[[Page H2775]]

     assistance provided under this chapter do not duplicate 
     adequate established telemedicine services or distance 
     learning services.
       ``(b) Loan Maturity.--The maturities of cost of money loans 
     shall be determined by the Secretary, based on the useful 
     life of the facility being financed, except that the loan 
     shall not be for a period of more than 10 years.
       ``(c) Loan Security and Feasibility.--The Secretary shall 
     make a cost of money loan only if the Secretary determines 
     that the security for the loan is reasonably adequate and 
     that the loan will be repaid within the period of the loan.
       ``(d) Encouraging Consortia.--The Secretary shall encourage 
     the development of consortia to provide telemedicine services 
     or distance learning services through telecommunications in 
     rural areas served by a telecommunications provider.
       ``(e) Coordination With Other Agencies.--The Secretary 
     shall coordinate, to the extent practicable, with other 
     Federal and State agencies with similar grant or loan 
     programs to pool resources for funding meritorious proposals 
     in rural areas.
       ``(f) Informational Efforts.--The Secretary shall establish 
     and implement procedures to carry out informational efforts 
     to advise potential end users located in rural areas of each 
     State about the program authorized by this chapter.

     ``SEC. 2335. REGULATIONS.

       ``Not later than 180 days after the date of enactment of 
     the Federal Agriculture Improvement and Reform Act of 1996, 
     the Secretary shall issue regulations to carry out this 
     chapter.

     ``SEC. 2335A. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated to carry out this 
     chapter $100,000,000 for each of fiscal years 1996 through 
     2002.''.

     SEC. 705. LIMITATION ON AUTHORIZATION OF APPROPRIATIONS FOR 
                   RURAL TECHNOLOGY GRANTS.

       Section 2347 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (Public Law 101-624; 104 Stat. 4034) is 
     amended--
       (1) by striking ``(a) In General.--''; and
       (2) by striking subsection (b).

     SEC. 706. DEMONSTRATION PROJECTS.

       Section 2348 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 2662a) is repealed.

     SEC. 707. MONITORING THE ECONOMIC PROGRESS OF RURAL AMERICA.

       Section 2382 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (Public Law 101-624; 13 U.S.C. 141 note) is 
     repealed.

     SEC. 708. ANALYSIS BY OFFICE OF TECHNOLOGY ASSESSMENT.

       Section 2385 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (Public Law 101-624; 7 U.S.C. 950aaa-4 
     note) is repealed.

     SEC. 709. RURAL HEALTH INFRASTRUCTURE IMPROVEMENT.

       Section 2391 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (Public Law 101-624; 7 U.S.C. 2662 note) is 
     repealed.

     SEC. 710. CENSUS OF AGRICULTURE.

       Section 2392 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (Public Law 101-624; 104 Stat. 4057) is 
     repealed.

     SEC. 711. STUDY OF THE TRANSPORTATION OF FERTILIZER AND 
                   AGRICULTURAL CHEMICALS TO FARMERS.

       Section 2517 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (Public Law 101-624; 104 Stat. 4077) is 
     repealed.

   CHAPTER 2--ALTERNATIVE AGRICULTURAL RESEARCH AND COMMERCIALIZATION

     SEC. 721. DEFINITIONS.

       Section 1657(c) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5901(c)) is amended--
       (1) by striking paragraphs (3) and (4);
       (2) by redesignating paragraph (5) as paragraph (3);
       (3) by redesignating paragraphs (6) through (12) as 
     paragraphs (7) through (13), respectively; and
       (4) by inserting after paragraph (3) (as redesignated by 
     paragraph (2)) the following:
       ``(4) Corporate board.--The term `Corporate Board' means 
     the Board of Directors of the Corporation described in 
     section 1659.
       ``(5) Corporation.--The term `Corporation' means the 
     Alternative Agricultural Research and Commercialization 
     Corporation established under section 1658.
       ``(6) Executive director.--The term `Executive Director' 
     means the Executive Director of the Corporation appointed 
     under section 1659(e).''.

     SEC. 722. ALTERNATIVE AGRICULTURAL RESEARCH AND 
                   COMMERCIALIZATION CORPORATION.

       (a) In General.--Section 1658 of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 5902) is 
     amended to read as follows:

     ``SEC. 1658. ALTERNATIVE AGRICULTURAL RESEARCH AND 
                   COMMERCIALIZATION CORPORATION.

       ``(a) Establishment.--To carry out this subtitle, there is 
     created a body corporate to be known as the Alternative 
     Agricultural Research and Commercialization Corporation, 
     which shall be an agency of the United States, within the 
     Department of Agriculture, subject to the general supervision 
     and direction of the Secretary, except as specifically 
     provided for in this subtitle.
       ``(b) Purpose.--The purpose of the Corporation is to--
       ``(1) expedite the development and market penetration of 
     industrial, nonfood, nonfeed products from agricultural and 
     forestry materials; and
       ``(2) assist the private sector in bridging the gap between 
     the results of research into nonfood, nonfeed products and 
     the commercialization of the research.
       ``(c) Place of Incorporation.--The Corporation shall be 
     incorporated in the District of Columbia.
       ``(d) Central Office.--The Secretary shall provide 
     facilities for the principal office of the Corporation within 
     the Washington, D.C., metropolitan area.
       ``(e) Wholly-Owned Government Corporation.--The Corporation 
     shall be considered a wholly-owned government corporation in 
     accordance with chapter 91 of title 31, United States Code.
       ``(f) General Powers.--In addition to any other powers 
     granted to the Corporation under this subtitle, the 
     Corporation--
       ``(1) shall have succession in its corporate name;
       ``(2) may adopt, alter, and rescind any bylaw and adopt and 
     alter a corporate seal, which shall be judicially noticed;
       ``(3) may enter into any agreement or contract with a 
     person or private or governmental agency, except that the 
     Corporation shall not provide any financial assistance unless 
     specifically authorized by this subtitle;
       ``(4) may lease, purchase, accept a gift or donation of, or 
     otherwise acquire, use, own, hold, improve, or otherwise deal 
     in or with, and sell, convey, mortgage, pledge, lease, 
     exchange, or otherwise dispose of, any property or interest 
     in property, as the Corporation considers necessary in the 
     transaction of the business of the Corporation, except that 
     this paragraph shall not provide authority for carrying out a 
     program of real estate investment;
       ``(5) may sue and be sued in the corporate name of the 
     Corporation, except that--
       ``(A) no attachment, injunction, garnishment, or similar 
     process shall be issued against the Corporation or property 
     of the Corporation; and
       ``(B) exclusive original jurisdiction shall reside in the 
     district courts of the United States, but the Corporation may 
     intervene in any court in any suit, action, or proceeding in 
     which the Corporation has an interest;
       ``(6) may independently retain legal representation;
       ``(7) may provide for and designate such committees, and 
     the functions of the committees, as the Corporate Board 
     considers necessary or desirable,
       ``(8) may indemnify the Executive Director and other 
     officers of the Corporation, as the Corporate Board considers 
     necessary and desirable, except that the Executive Director 
     and officers shall not be indemnified for an act outside the 
     scope of employment;
       ``(9) may, with the consent of any board, commission, 
     independent establishment, or executive department of the 
     Federal Government, including any field service, use 
     information, services, facilities, officials, and employees 
     in carrying out this subtitle, and pay for the use, which 
     payments shall be transferred to the applicable appropriation 
     account that incurred the expense;
       ``(10) may obtain the services and fix the compensation of 
     any consultant and otherwise procure temporary and 
     intermittent services under section 3109(b) of title 5, 
     United States Code;
       ``(11) may use the United States mails on the same terms 
     and conditions as the Executive agencies of the Federal 
     Government;
       ``(12) shall have the rights, privileges, and immunities of 
     the United States with respect to the right to priority of 
     payment with respect to debts due from bankrupt, insolvent, 
     or deceased creditors;
       ``(13) may collect or compromise any obligations assigned 
     to or held by the Corporation, including any legal or 
     equitable rights accruing to the Corporation;
       ``(14) shall determine the character of, and necessity for, 
     obligations and expenditures of the Corporation and the 
     manner in which the obligations and expenditures shall be 
     incurred, allowed, and paid, subject to provisions of law 
     specifically applicable to Government corporations;
       ``(15) may make final and conclusive settlement and 
     adjustment of any claim by or against the Corporation or a 
     fiscal officer of the Corporation;
       ``(16) may sell assets, loans, and equity interests 
     acquired in connection with the financing of projects funded 
     by the Corporation; and
       ``(17) may exercise all other lawful powers necessarily or 
     reasonably related to the establishment of the Corporation to 
     carry out this subtitle and the powers, purposes, functions, 
     duties, and authorized activities of the Corporation.
       ``(g) Specific Powers.--To carry out this subtitle, the 
     Corporation may--
       ``(1) make grants to, and enter into cooperative agreements 
     and contracts with, eligible applicants for research, 
     development, and demonstration projects in accordance with 
     section 1660;
       ``(2) make loans and interest subsidy payments and invest 
     venture capital in accordance with section 1661;
       ``(3) collect and disseminate information concerning State, 
     regional, and local commercialization projects;
       ``(4) search for new nonfood, nonfeed products that may be 
     produced from agricultural commodities and for processes to 
     produce the products;
       ``(5) administer, maintain, and dispense funds from the 
     Fund to facilitate the conduct of activities under this 
     subtitle; and
       ``(6) engage in other activities incident to carrying out 
     the functions of the Corporation.''.
       (b) Wholly-Owned Government Corporation.--Section 9101(3) 
     of title 31, United States Code, is amended--
       (1) by redesignating subparagraph (N) (relating to the 
     Uranium Enrichment Corporation) as subparagraph (O); and

[[Page H2776]]

       (2) by adding at the end the following:
       ``(Q) the Alternative Agricultural Research and 
     Commercialization Corporation.''.
       (c) Conforming Amendment.--Section 211(b)(5) of the 
     Department of Agriculture Reorganization Act of 1994 (7 
     U.S.C. 6911(b)(5)) is amended by striking ``Alternative 
     Agricultural Research and Commercialization Board'' and 
     inserting ``Corporate Board of the Alternative 
     Agricultural Research and Commercialization Corporation''.

     SEC. 723. BOARD OF DIRECTORS, EMPLOYEES, AND FACILITIES.

       (a) In General.--Section 1659 of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 5903) is 
     amended to read as follows:

     ``SEC. 1659. BOARD OF DIRECTORS, EMPLOYEES, AND FACILITIES.

       ``(a) In General.--The powers of the Corporation shall be 
     vested in a Corporate Board.
       ``(b) Members of the Corporate Board.--The Corporate Board 
     shall consist of 11 members as follows:
       ``(1) The Under Secretary of Agriculture for Rural 
     Development.
       ``(2) The Under Secretary of Agriculture for Research, 
     Education, and Economics.
       ``(3) 5 members appointed by the Secretary, of whom--
       ``(A) at least 1 member shall be a representative of the 
     leading scientific disciplines relevant to the activities of 
     the Corporation;
       ``(B) at least 1 member shall be a producer or processor of 
     agricultural commodities;
       ``(C) at least 1 member shall be a person who is privately 
     engaged in the commercialization of new nonfood, nonfeed 
     products from agricultural commodities; and
       ``(D) at least 1 member shall have expertise in financial 
     management.

     A different member shall be appointed pursuant to each 
     subparagraph of this paragraph.
       ``(4) 2 members appointed by the Secretary who--
       ``(A) have expertise in areas of applied research relating 
     to the development or commercialization of new nonfood, 
     nonfeed products; and
       ``(B) shall be appointed from a group of at least 4 
     individuals nominated by the Director of the National Science 
     Foundation if the nominations are made not later than 60 days 
     after the date a vacancy occurs.
       ``(5) 2 members appointed by the Secretary who--
       ``(A) have expertise in financial and managerial matters; 
     and
       ``(B) shall be appointed from a group of at least 4 
     individuals nominated by the Secretary of Commerce if the 
     nominations are made not later than 60 days after the date a 
     vacancy occurs.
       ``(c) Responsibilities of the Corporate Board.--
       ``(1) In general.--The Corporate Board shall--
       ``(A) be responsible for the general supervision of the 
     Corporation and Regional Centers established under section 
     1663;
       ``(B) determine (in consultation with Regional Centers) 
     high priority commercialization areas to receive assistance 
     under section 1663;
       ``(C) review any grant, contract, or cooperative agreement 
     to be made or entered into by the Corporation under section 
     1660 and any financial assistance to be provided under 
     section 1661;
       ``(D) make the final decision, by majority vote, on whether 
     and how to provide assistance to an applicant; and
       ``(E) develop and establish a budget plan and a long-term 
     operating plan to carry out this subtitle.
       ``(2) Authority of the secretary.--
       ``(A) In general.--The Secretary shall vacate and remand to 
     the Corporate Board for reconsideration any decision made 
     pursuant to paragraph (1)(D) if the Secretary determines that 
     there has been a violation of subsection (j), or any conflict 
     of interest provisions of the bylaws of the Corporate Board, 
     with respect to the decision.
       ``(B) Reasons.--In the case of any violation and referral 
     of a funding decision to the Corporate Board, the Secretary 
     shall inform the Corporate Board of the reasons for any 
     remand pursuant to subparagraph (A).
       ``(d) Chairperson.--The members of the Corporate Board 
     shall select a Chairperson from among the members of the 
     Corporate Board. The term of office of the Chairperson shall 
     be 2 years. The members referred to in paragraphs (1) and (2) 
     of subsection (b) may not serve as Chairperson.
       ``(e) Executive Director.--
       ``(1) Appointment.--The Corporate Board shall appoint an 
     Executive Director, subject to the approval of the Secretary.
       ``(2) Duties.--The Executive Director shall be the chief 
     executive officer of the Corporation, with such power and 
     authority as may be conferred by the Corporate Board.
       ``(3) Compensation.--The Executive Director shall receive 
     basic pay at the rate provided for level IV of the Executive 
     Schedule under section 5315 of title 5, United States Code.
       ``(f) Officers.--The Corporate Board shall establish the 
     offices and appoint the officers of the Corporation, 
     including a Secretary, and define the duties of the officers 
     in a manner consistent with this subtitle.
       ``(g) Meetings.--The Corporate Board shall meet at least 3 
     times each fiscal year at the call of the Chairperson or at 
     the request of the Executive Director. The location of the 
     meetings shall be subject to approval of the Executive 
     Director. A quorum of the Corporate Board shall consist of a 
     majority of the members. The decisions of the Corporate Board 
     shall be made by majority vote.
       ``(h) Term; Vacancies.--
       ``(1) In general.--The term of office of a member of the 
     Corporate Board shall be 4 years, except that the members 
     initially appointed shall be appointed to serve staggered 
     terms. A member appointed to fill a vacancy for an unexpired 
     term may be appointed only for the remainder of the term. A 
     vacancy on the Corporate Board shall be filled in the same 
     manner as the original appointment. The Secretary may remove 
     a member of the Corporate Board only for cause.
       ``(2) Transition measure.--The Secretary may appoint to the 
     Corporate Board an individual who, on the day before the date 
     of enactment of the Federal Agriculture Improvement and 
     Reform Act of 1996, was serving on the former Alternative 
     Agricultural Research and Commercialization Board, for a term 
     that does not exceed the term for which the individual was 
     appointed to the former Board.
       ``(i) Compensation.--A member of the Corporate Board who is 
     an officer or employee of the United States shall not receive 
     any additional compensation by reason of service on the 
     Corporate Board. Any other member shall receive, for each day 
     (including travel time) the member is engaged in the 
     performance of the functions of the Corporate Board, 
     compensation at a rate not to exceed the daily equivalent of 
     the annual rate in effect for Level IV of the Executive 
     Schedule. A member of the Corporate Board shall be reimbursed 
     for travel, subsistence, and other necessary expenses 
     incurred by the member in the performance of the duties of 
     the member.
       ``(j) Conflict of Interest; Financial Disclosure.--
       ``(1) Conflict of interest.--Except as provided in 
     paragraph (3), no member of the Corporate Board shall vote on 
     any matter respecting any application, contract, claim, or 
     other particular matter pending before the Corporation, in 
     which, to the knowledge of the member, the member, spouse, or 
     child of the member, partner, or organization in which the 
     member is serving as officer, director, trustee, partner, or 
     employee, or any person or organization with whom the member 
     is negotiating or has any arrangement concerning prospective 
     employment, has a financial interest.
       ``(2) Violations.--Violation of paragraph (1) by a member 
     of the Corporate Board shall be cause for removal of the 
     member, but shall not impair or otherwise affect the validity 
     of any otherwise lawful action by the Corporation in which 
     the member participated.
       ``(3) Exceptions.--The prohibitions contained in paragraph 
     (1) shall not apply if a member of the Corporate Board 
     advises the Corporate Board of the nature of the particular 
     matter in which the member proposes to participate, and if 
     the member makes a full disclosure of the financial interest, 
     prior to any participation, and the Corporate Board 
     determines, by majority vote, that the financial interest is 
     too remote or too inconsequential to affect the integrity of 
     the member's services to the Corporation in that matter. The 
     member involved shall not vote on the determination.
       ``(4) Financial disclosure.--A Board member shall be 
     subject to the financial disclosure requirements set forth in 
     subchapter B of chapter XVI of title 5, Code of Federal 
     Regulations (or any corresponding or similar regulation or 
     ruling), applicable to a special Government employee (as 
     defined in section 202(a) of title 18, United States Code).
       ``(k) Delegation of Authority.--
       ``(1) In general.--The Corporate Board may, by resolution, 
     delegate to the Chairperson, the Executive Director, or any 
     other officer or employee any function, power, or duty 
     assigned to the Corporation under this subtitle, other than a 
     function, power, or duty expressly vested in the Corporate 
     Board by subsections (c) through (n).
       ``(2) Prohibition on delegation.--Notwithstanding any other 
     law, the Secretary and any other officer or employee of the 
     United States shall not make any delegation to the Corporate 
     Board, the Chairperson, the Executive Director, or the 
     Corporation of any power, function, or authority not 
     expressly authorized by this subtitle, unless the delegation 
     is made pursuant to an authority in law that expressly makes 
     reference to this section.
       ``(3) Reorganization act.--Notwithstanding any other law, 
     the President (through authorities provided under chapter 9 
     of title 5, United States Code) may not authorize the 
     transfer to the Corporation of any power, function, or 
     authority in addition to powers, functions, and authorities 
     provided by law.
       ``(l) Bylaws.--Notwithstanding section 1658(f)(2), the 
     Corporate Board shall adopt, and may from time to time amend, 
     any bylaw that is necessary for the proper management and 
     functioning of the Corporation. The Corporate Board shall not 
     adopt any bylaw that has not been reviewed and approved by 
     the Secretary.
       ``(m) Organization.--The Corporate Board shall provide a 
     system of organization to fix responsibility and promote 
     efficiency.
       ``(n) Personnel and Facilities of Corporation.--
       ``(1) Appointment and compensation of personnel.--The 
     Corporation may select and appoint officers, attorneys, 
     employees, and agents, who shall be vested with such powers 
     and duties as the Corporation may determine.
       ``(2) Use of facilities and services of the department of 
     agriculture.--Notwithstanding any other provision of law, to 
     perform the responsibilities of the Corporation under this 
     subtitle, the Corporation may partially or jointly utilize 
     the facilities of and the services of employees of the 
     Department of Agriculture, without cost to the Corporation.
       ``(3) Government employment laws.--An officer or employee 
     of the Corporation shall be subject to all laws of the United 
     States relating to governmental employment.''.

[[Page H2777]]

       (b) Conforming Amendment.--Section 5315 of title 5, United 
     States Code, is amended by adding at the end the following:
       ``Executive Director of the Alternative Agricultural 
     Research and Commercialization Corporation.''.

     SEC. 724. RESEARCH AND DEVELOPMENT GRANTS, CONTRACTS, AND 
                   AGREEMENTS.

       Section 1660 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5904) is amended--
       (1) by striking ``Center'' each place it appears and 
     inserting ``Corporation'';
       (2) in subsection (c), by striking ``Board'' and inserting 
     ``Corporate Board''; and
       (3) in subsection (f), by striking ``non-Center'' and 
     inserting ``non-Corporation''.

     SEC. 725. COMMERCIALIZATION ASSISTANCE.

       Section 1661 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5905) is amended--
       (1) by striking ``Center'' each place it appears and 
     inserting ``Corporation'';
       (2) by striking ``Board'' each place it appears and 
     inserting ``Corporate Board'';
       (3) by striking subsection (c);
       (4) by redesignating subsections (d), (e), and (f) as 
     subsections (c), (d), and (e), respectively; and
       (5) in subsection (c) (as so redesignated)--
       (A) in the subsection heading of paragraph (1), by striking 
     ``director'' and inserting ``executive director''; and
       (B) by striking ``Director'' each place it appears and 
     inserting ``Executive Director''.

     SEC. 726. GENERAL RULES REGARDING THE PROVISION OF 
                   ASSISTANCE.

       Section 1662 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5906) is amended--
       (1) by striking ``Center'' each place it appears (except in 
     subsection (b)) and inserting ``Corporation'';
       (2) by striking ``Board'' each place it appears and 
     inserting ``Corporate Board''; and
       (3) in subsection (b)--
       (A) in the second sentence, by striking ``Board, a Regional 
     Center, or the Advisory Council'' and inserting ``Board or a 
     Regional Center''; and
       (B) by striking the third sentence.

     SEC. 727. REGIONAL CENTERS.

       Section 1663 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5907) is amended--
       (1) by striking ``Board'' each place it appears and 
     inserting ``Corporate Board'';
       (2) in subsection (e)(8), by striking ``Center'' and 
     inserting ``Corporation''; and
       (3) in subsection (f)--
       (A) in paragraph (2), by striking ``in consultation with 
     the Advisory Council appointed under section 1661(c)''; and
       (B) by striking paragraphs (3) and (4) and inserting the 
     following:
       ``(3) Recommendation.--The Regional Director, based on the 
     comments of the reviewers, shall make and submit a 
     recommendation to the Board, which shall not be binding on 
     the Board.''.

     SEC. 728. ALTERNATIVE AGRICULTURAL RESEARCH AND 
                   COMMERCIALIZATION REVOLVING FUND.

       Section 1664 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5908) is amended to read as 
     follows:

     ``SEC. 1664. ALTERNATIVE AGRICULTURAL RESEARCH AND 
                   COMMERCIALIZATION REVOLVING FUND.

       ``(a) Establishment.--There is established in the Treasury 
     of the United States a revolving fund to be known as the 
     Alternative Agricultural Research and Commercialization 
     Revolving Fund. The Fund shall be available to the 
     Corporation, without fiscal year limitation, to carry out 
     this subtitle.
       ``(b) Contents of Fund.--There shall be deposited in the 
     Fund--
       ``(1) such amounts as may be appropriated or transferred to 
     support programs and activities of the Corporation;
       ``(2) payments received from any source for products, 
     services, or property furnished in connection with the 
     activities of the Corporation;
       ``(3) fees and royalties collected by the Corporation from 
     licensing or other arrangements relating to commercialization 
     of products developed through projects funded in whole or 
     part by grants, contracts, or cooperative agreements executed 
     by the Corporation;
       ``(4) proceeds from the sale of assets, loans, and equity 
     interests made in furtherance of the purposes of the 
     Corporation;
       ``(5) donations or contributions accepted by the 
     Corporation to support authorized programs and activities; 
     and
       ``(6) any other funds acquired by the Corporation.
       ``(c) Funding Allocations.--Funding of projects and 
     activities under this subtitle shall be subject to the 
     following restrictions:
       ``(1) Of the total amount of funds made available for a 
     fiscal year under this subtitle--
       ``(A) not more than the lesser of 15 percent or $3,000,000 
     may be set aside to be used for authorized administrative 
     expenses of the Corporation;
       ``(B) not more than 1 percent may be set aside to be used 
     for generic studies and specific reviews of individual 
     proposals for financial assistance; and
       ``(C) except as provided in subsection (e), not less than 
     84 percent shall be set aside to be awarded to qualified 
     applicants who file project applications with, or respond to 
     requests for proposals from, the Corporation under sections 
     1660 and 1661.
       ``(2) Any funds remaining uncommitted at the end of a 
     fiscal year shall be credited to the Fund and added to the 
     total program funds available to the Corporation for the next 
     fiscal year.
       ``(d) Authorized Administrative Expenses.--For the purposes 
     of this section, authorized administrative expenses shall 
     include all ordinary and necessary expenses, including all 
     compensation for personnel and consultants, expenses for 
     computer usage, or space needs of the Corporation and similar 
     expenses. Funds authorized for administrative expenses shall 
     not be available for the acquisition of real property.
       ``(e) Project Monitoring.--The Corporate Board may 
     establish, in the bylaws of the Corporate Board, that a 
     percentage (which shall not exceed 1 percent) of the funds 
     provided under subsection (c) for any commercialization 
     project shall be expended to ensure that project funds are 
     being utilized in accordance with the project agreement.
       ``(f) Termination of the Fund.--On expiration of the 
     authority provided by this subtitle, all assets (after 
     payment of all outstanding obligations) of the Fund shall 
     revert to the general fund of the Treasury.
       ``(g) Authorization of Appropriations; Capitalization.--
       ``(1) Authorization of appropriation.--There are authorized 
     to be appropriated to the Fund $75,000,000 for each of fiscal 
     years 1996 through 2002.
       ``(2) Capitalization.--The Executive Director may pay in as 
     capital of the Corporation, out of dollar receipts made 
     available through annual appropriations, $75,000,000 for each 
     of fiscal years 1996 through 2002. On the payment of an 
     amount of capital by the Executive Director, the Corporation 
     shall issue an equivalent amount of capital stock to the 
     Secretary of the Treasury.
       ``(3) Transfer.--All obligations, assets, and related 
     rights and responsibilities of the former Alternative 
     Agricultural Research and Commercialization Center 
     established under former section 1658 of this Act (as in 
     effect on the day before the date of enactment of the Federal 
     Agriculture Improvement and Reform Act of 1996) are 
     transferred to the Corporation.''.

     SEC. 729. PROCUREMENT PREFERENCES FOR PRODUCTS RECEIVING 
                   CORPORATION ASSISTANCE.

       Subtitle G of title XVI of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 5901 et seq.) 
     is amended by adding at the end the following:

     ``SEC. 1665. PROCUREMENT OF ALTERNATIVE AGRICULTURAL RESEARCH 
                   AND COMMERCIALIZATION PRODUCTS.

       ``(a) Definition of Executive Agency.--In this section, the 
     term `executive agency' has the meaning provided the term in 
     section 4(1) of the Office of Federal Procurement Policy Act 
     (41 U.S.C. 403(1)).
       ``(b) Procurement.--To further the achievement of the 
     purposes specified in section 1657(b), an executive agency 
     may, for any procurement involving the acquisition of 
     property, establish set-asides and preferences for property 
     that has been commercialized with assistance provided under 
     this subtitle.
       ``(c) Set-Asides.--Procurements solely for property may be 
     set-aside exclusively for products developed with 
     commercialization assistance provided under section 1661.
       ``(d) Preferences.--Preferences for property developed with 
     assistance provided under this subtitle in procurements 
     involving the acquisition of property may be--
       ``(1) a price preference, if the procurement is solely for 
     property, of not greater than a percentage to be determined 
     within the sole discretion of the head of the procuring 
     agency; or
       ``(2) a technical evaluation preference included as an 
     award factor or subfactor as determined within the sole 
     discretion of the head of the procuring agency.
       ``(e) Notice.--Each competitive solicitation or invitation 
     for bids selected by an executive agency for a set-aside or 
     preference under this section shall contain a provision 
     notifying offerors where a list of products eligible for the 
     set aside or preference may be obtained.
       ``(f) Eligibility.--Offerors shall receive the set aside or 
     preference required under this section if, in the case of 
     products developed with financial assistance under--
       ``(1) section 1660, less than 10 years have elapsed since 
     the expiration of the grant, cooperative agreement, or 
     contract;
       ``(2) paragraph (1) or (2) of section 1661(a), less than 5 
     years have elapsed since the date the loan was made or 
     insured;
       ``(3) section 1661(a)(3), less than 5 years have elapsed 
     since the date of sale of any remaining government equity 
     interest in the company; or
       ``(4) section 1661(a)(4), less than 5 years have elapsed 
     since the date of the final payment on the repayable 
     grant.''.

     SEC. 730. BUSINESS PLAN AND FEASIBILITY STUDY AND REPORT.

       (a) Business Plan.--Not later than 180 days after the date 
     of enactment of this Act, the Alternative Agricultural 
     Research and Commercialization Corporation established by 
     section 1658 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 shall--
       (1) develop a 5-year business plan pursuant to section 
     1659(c)(1)(E) of the Act; and
       (2) submit the plan to the Secretary of Agriculture, the 
     Committee on Agriculture of the House of Representatives, and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate.
       (b) Feasibility Study and Report.--
       (1) Study.--The Secretary of Agriculture shall conduct a 
     study of, and prepare a report on, the continued feasibility 
     of the Alternative Agricultural Research and 
     Commercialization Corporation. In conducting the study, the 
     Secretary shall examine options for privatizing the 
     Corporation and converting the Corporation to a Government-
     sponsored enterprise.
       (2) Report.--Not later than December 31, 2001, the 
     Secretary shall transmit the report required by paragraph (1) 
     to the Committee on Agriculture of the House of 
     Representatives and

[[Page H2778]]

     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate.
 Subtitle B--Amendments to the Consolidated Farm and Rural Development 
                                  Act

                     CHAPTER 1--GENERAL PROVISIONS

     SEC. 741. WATER AND WASTE FACILITY LOANS AND GRANTS.

       (a) In General.--Section 306(a) of the Consolidated Farm 
     and Rural Development Act (7 U.S.C. 1926(a)) is amended--
       (1) in the first sentence of paragraph (2), by striking 
     ``$500,000,000'' and inserting ``$590,000,000'';
       (2) by striking paragraph (7) and inserting the following:
       ``(7) Definition of rural and rural areas.--For the purpose 
     of water and waste disposal grants and direct and guaranteed 
     loans provided under paragraphs (1) and (2), the terms 
     `rural' and `rural area' mean a city, town, or unincorporated 
     area that has a population of no more than 10,000 
     inhabitants.'';
       (3) by striking paragraphs (9), (10), and (11) and 
     inserting the following:
       ``(9) Conformity with state drinking water standards.--No 
     Federal funds shall be made available under this section for 
     a water system unless the Secretary determines that the water 
     system will make significant progress toward meeting the 
     standards established under title XIV of the Public Health 
     Service Act (commonly known as the `Safe Drinking Water Act') 
     (42 U.S.C. 300f et seq.).
       ``(10) Conformity with federal and state water pollution 
     control standards.--No Federal funds shall be made available 
     under this section for a water treatment discharge or waste 
     disposal system unless the Secretary determines that the 
     effluent from the system conforms with applicable Federal and 
     State water pollution control standards.
       ``(11) Rural business opportunity grants.--
       ``(A) In general.--The Secretary may make grants, not to 
     exceed $1,500,000 annually, to public bodies, private 
     nonprofit community development corporations or entities, or 
     such other agencies as the Secretary may select to enable the 
     recipients--
       ``(i) to identify and analyze business opportunities, 
     including opportunities in export markets, that will use 
     local rural economic and human resources;
       ``(ii) to identify, train, and provide technical assistance 
     to existing or prospective rural entrepreneurs and managers;
       ``(iii) to establish business support centers and otherwise 
     assist in the creation of new rural businesses, the 
     development of methods of financing local businesses, and the 
     enhancement of the capacity of local individuals and entities 
     to engage in sound economic activities;
       ``(iv) to conduct regional, community, and local economic 
     development planning and coordination, and leadership 
     development; and
       ``(v) to establish centers for training, technology, and 
     trade that will provide training to rural businesses in the 
     utilization of interactive communications technologies to 
     develop international trade opportunities and markets.
       ``(B) Criteria.--In awarding the grants, the Secretary 
     shall consider, among other criteria to be established by the 
     Secretary--
       ``(i) the extent to which the applicant provides 
     development services in the rural service area of the 
     applicant; and
       ``(ii) the capability of the applicant to accomplish the 
     activities described in the relevant clauses of subparagraph 
     (A).
       ``(C) Coordination.--The Secretary shall ensure, to the 
     maximum extent practicable, that assistance provided under 
     this paragraph is coordinated with and delivered in 
     cooperation with similar services or assistance provided to 
     rural residents by the Cooperative State Research, Education, 
     and Extension Service or other Federal agencies.
       ``(D) Authorization of appropriations.--There are 
     authorized to be appropriated to carry out this paragraph 
     $7,500,000 for each of fiscal years 1996 through 2002.'';
       (4) by striking paragraphs (14) and (15);
       (5) by redesignating paragraphs (16) through (20) as 
     paragraphs (14) through (18), respectively; and
       (6) in paragraph (14) (as so redesignated)--
       (A) by striking ``(14)(A) The'' and inserting the 
     following:
       ``(14) Rural water and wastewater technical assistance and 
     training programs.--
       ``(A) In general.--The'';
       (B) in subparagraph (A)--
       (i) by striking ``(i) identify'' and inserting the 
     following:
       ``(i) identify'';
       (ii) by striking ``(ii) prepare'' and inserting the 
     following:
       ``(ii) prepare''; and
       (iii) by striking ``(iii) improve'' and inserting the 
     following:
       ``(iii) improve'';
       (C) in subparagraph (B), by striking ``(B) In'' and 
     inserting the following:
       ``(B) Selection priority.--In''; and
       (D) in subparagraph (C)--
       (i) by striking ``(C) Not'' and inserting the following:
       ``(C) Funding.--Not''; and
       (ii) by striking ``2 per centum of any funds provided in 
     Appropriations Acts'' and inserting ``3 percent of any funds 
     appropriated''.
       (b) Conforming Amendment.--The second sentence of section 
     309A(a) of the Consolidated Farm and Rural Development Act (7 
     U.S.C. 1929a(a)) (as amended by section 661(c)(1)) is amended 
     by striking ``, 306(a)(14),''.

     SEC. 742. EMERGENCY COMMUNITY WATER ASSISTANCE GRANT PROGRAM 
                   FOR SMALL COMMUNITIES.

       Section 306A of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1926a) is amended--
       (1) in subsection (e)--
       (A) in paragraph (1)(A), by striking ``15,000'' and 
     inserting ``10,000''; and
       (B) in paragraph (2), by striking ``5,000'' and inserting 
     ``3,000''; and
       (2) by striking subsection (i) and inserting the following:
       ``(i) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section 
     $35,000,000 for each of fiscal years 1996 through 2002.''.

     SEC. 743. EMERGENCY COMMUNITY WATER ASSISTANCE GRANT PROGRAM 
                   FOR SMALLEST COMMUNITIES.

       Section 306B of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1926b) is repealed.

     SEC. 744. AGRICULTURAL CREDIT INSURANCE FUND.

       Section 309(f) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1929(f)) is amended--
       (1) by striking paragraph (1); and
       (2) by redesignating paragraphs (2) through (6) as 
     paragraphs (1) through (5), respectively.

     SEC. 745. RURAL DEVELOPMENT INSURANCE FUND.

       Section 309A(g) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1929a(g)) is amended--
       (1) by striking paragraph (1); and
       (2) by redesignating paragraphs (2) through (8) as 
     paragraphs (1) through (7), respectively.

     SEC. 746. INSURED WATERSHED AND RESOURCE CONSERVATION AND 
                   DEVELOPMENT LOANS.

       Section 310A of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1931) is repealed.

     SEC. 747. RURAL INDUSTRIALIZATION ASSISTANCE.

       (a) In General.--Section 310B of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 1932) is amended--
       (1) in the first sentence of subsection (a)--
       (A) by striking ``and'' at the end of clause (2); and
       (B) by inserting before the period the following: ``, and 
     (4) to facilitate economic opportunity for industries 
     undergoing adjustment from terminated Federal agricultural 
     price and income support programs or increased competition 
     from foreign trade'';
       (2) in subsection (b), by striking ``(b)(1)'' and all that 
     follows through ``(2) The'' and inserting the following:
       ``(b) Solid Waste Management Grants.--The'';
       (3) in subsection (c)--
       (A) by striking ``(c)(1) The'' and inserting the following:
       ``(c) Rural Business Enterprise Grants.--
       ``(1) In general.--The'';
       (B) in paragraph (1), by inserting ``(including nonprofit 
     entities)'' after ``private business enterprises'';
       (C) in paragraph (2)--
       (i) by striking ``(2) The'' and inserting the following:
       ``(2) Passenger transportation services or facilities.--
     The''; and
       (ii) by striking ``make grants'' and inserting ``award 
     grants on a competitive basis''; and
       (D) by adding at the end the following:
       ``(3) Grants to aid industries in adjusting to terminated 
     federal agricultural programs or increased foreign 
     competition.--The Secretary may make grants under this 
     section to facilitate economic opportunity for industries 
     undergoing adjustment from terminated Federal agricultural 
     price and income support programs or increased competition 
     from foreign trade.'';
       (4) by striking subsection (e) and inserting the following:
       ``(e) Rural Cooperative Development Grants.--
       ``(1) Definitions.--In this subsection:
       ``(A) Nonprofit institution.--The term `nonprofit 
     institution' means any organization or institution, including 
     an accredited institution of higher education, no part of the 
     net earnings of which inures, or may lawfully inure, to the 
     benefit of any private shareholder or individual.
       ``(B) United states.--The term `United States' means the 
     several States, the District of Columbia, the Commonwealth of 
     Puerto Rico, the Virgin Islands, Guam, American Samoa, and 
     the other territories and possessions of the United States.
       ``(2) Grants.--The Secretary shall make grants under this 
     subsection to nonprofit institutions for the purpose of 
     enabling the institutions to establish and operate centers 
     for rural cooperative development.
       ``(3) Goals.--The goals of a center funded under this 
     subsection shall be to facilitate the creation of jobs in 
     rural areas through the development of new rural 
     cooperatives, value added processing, and rural businesses.
       ``(4) Application.--Any nonprofit institution seeking a 
     grant under paragraph (2) shall submit to the Secretary an 
     application containing a plan for the establishment and 
     operation by the institution of a center or centers for 
     cooperative development. The Secretary may approve the 
     application if the plan contains the following:
       ``(A) A provision that substantiates that the center will 
     effectively serve rural areas in the United States.
       ``(B) A provision that the primary objective of the center 
     will be to improve the economic condition of rural areas 
     through cooperative development.
       ``(C) A description of the activities that the center will 
     carry out to accomplish the objective. The activities may 
     include the following:
       ``(i) Programs for applied research and feasibility studies 
     that may be useful to individuals, cooperatives, small 
     businesses, and other similar entities in rural areas served 
     by the center.

[[Page H2779]]

       ``(ii) Programs for the collection, interpretation, and 
     dissemination of information that may be useful to 
     individuals, cooperatives, small businesses, and other 
     similar entities in rural areas served by the center.
       ``(iii) Programs providing training and instruction for 
     individuals, cooperatives, small businesses, and other 
     similar entities in rural areas served by the center.
       ``(iv) Programs providing loans and grants to individuals, 
     cooperatives, small businesses, and other similar entities in 
     rural areas served by the center.
       ``(v) Programs providing technical assistance, research 
     services, and advisory services to individuals, cooperatives, 
     small businesses, and other similar entities in rural areas 
     served by the center.
       ``(vi) Programs providing for the coordination of services 
     and sharing of information among the center.
       ``(D) A description of the contributions that the 
     activities are likely to make to the improvement of the 
     economic conditions of the rural areas for which the center 
     will provide services.
       ``(E) Provisions that the center, in carrying out the 
     activities, will seek, where appropriate, the advice, 
     participation, expertise, and assistance of representatives 
     of business, industry, educational institutions, the Federal 
     Government, and State and local governments.
       ``(F) Provisions that the center will take all practicable 
     steps to develop continuing sources of financial support for 
     the center, particularly from sources in the private sector.
       ``(G) Provisions for--
       ``(i) monitoring and evaluating the activities by the 
     nonprofit institution operating the center; and
       ``(ii) accounting for money received by the institution 
     under this section.
       ``(5) Awarding grants.--Grants made under paragraph (2) 
     shall be made on a competitive basis. In making grants under 
     paragraph (2), the Secretary shall give preference to grant 
     applications providing for the establishment of centers for 
     rural cooperative development that--
       ``(A) demonstrate a proven track record in administering a 
     nationally coordinated, regionally or State-wide operated 
     project;
       ``(B) demonstrate previous expertise in providing technical 
     assistance in rural areas;
       ``(C) demonstrate the ability to assist in the retention of 
     businesses, facilitate the establishment of cooperatives and 
     new cooperative approaches, and generate employment 
     opportunities that will improve the economic conditions of 
     rural areas;
       ``(D) demonstrate the ability to create horizontal linkages 
     among businesses within and among various sectors in rural 
     areas of the United States and vertical linkages to domestic 
     and international markets;
       ``(E) commit to providing technical assistance and other 
     services to underserved and economically distressed areas in 
     rural areas of the United States; and
       ``(F) commit to providing greater than a 25 percent 
     matching contribution with private funds and in-kind 
     contributions.
       ``(6) 1-year grants; authority to approve grant for 1 
     additional year without application.--The Secretary shall 
     make grants under this subsection for a period of 1 year. The 
     Secretary shall evaluate programs receiving assistance under 
     this subsection. If the Secretary determines it to be in the 
     best interest of the program, the Secretary may award an 
     additional grant to the program for the immediately 
     succeeding year without application for the grant.
       ``(7) Technical assistance to prevent excessive 
     unemployment or underemployment.--In carrying out this 
     subsection, the Secretary may provide technical assistance to 
     alleviate or prevent conditions of excessive unemployment, 
     underemployment, outmigration, or low employment growth in 
     economically distressed rural areas that the Secretary 
     determines have a substantial need for the assistance. The 
     assistance may include planning and feasibility studies, 
     management and operational assistance, and studies evaluating 
     the need for development potential of projects that increase 
     employment and improve economic growth in the areas.
       ``(8) Grants to defray administrative costs.--The Secretary 
     may make grants to defray not to exceed 75 percent of the 
     costs incurred by organizations and public bodies to carry 
     out projects for which grants or loans are made under this 
     subsection. For purposes of determining the non-Federal share 
     of the costs, the Secretary shall consider contributions in 
     cash and in kind, fairly evaluated, including premises, 
     equipment, and services.
       ``(9) Authorization of appropriations.--There are 
     authorized to be appropriated to carry out this subsection 
     $50,000,000 for each of fiscal years 1996 through 2002.'';
       (5) by striking subsections (f), (g), (h), and (i);
       (6) by redesignating subsection (j) as subsection (f); and
       (7) by adding at the end the following:
       ``(g) Loan Guarantees for the Purchase of Cooperative 
     Stock.--
       ``(1) Definition of farmer.--In this subsection, the term 
     `farmer' means any farmer that the Secretary determines is a 
     family farmer.
       ``(2) Loan guarantees.--The Secretary may guarantee loans 
     under this section to individual farmers for the purpose of 
     purchasing start-up capital stock of a farmer cooperative 
     established for the purpose of processing an agricultural 
     commodity.
       ``(3) Eligibility.--To be eligible for a loan guarantee 
     under this subsection, a farmer must produce the agricultural 
     commodity that will be processed by the cooperative.''.
       (b) Conforming Amendments.--
       (1) Clause (iii) of section 307(a)(6)(B) of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 
     1927(a)(6)(B)) (as redesignated by section 661(a)(2)) is 
     amended by striking ``subsections (d) and (e) of section 
     310B'' and inserting ``section 310B(d)''.
       (2) Section 232(c)(2) of the Department of Agriculture 
     Reorganization Act of 1994 (7 U.S.C. 6942(c)(2)) is amended--
       (A) by striking ``310B(b)(2)'' and inserting ``310B(b)''; 
     and
       (B) by striking ``1932(b)(2)'' and inserting ``1932(b)''.
       (3) Section 233(b) of the Department of Agriculture 
     Reorganization Act of 1994 (7 U.S.C. 6943(b)) is amended--
       (A) by striking paragraph (2); and
       (B) by redesignating paragraph (3) as paragraph (2).

     SEC. 748. ADMINISTRATION.

       Section 331(b)(4) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1981(b)(4)) is amended--
       (1) by inserting after ``claims'' the following: 
     ``(including debts and claims arising from loan 
     guarantees)'';
       (2) by striking ``Farmers Home Administration or'' and 
     inserting ``Consolidated Farm Service Agency, Rural Utilities 
     Service, Rural Housing Service, Rural Business-Cooperative 
     Service, or a successor agency, or''; and
       (3) by inserting after ``activities under the Housing Act 
     of 1949.'' the following: ``In the case of a security 
     instrument entered into under the Rural Electrification Act 
     of 1936 (7 U.S.C. 901 et seq.), the Secretary shall notify 
     the Attorney General of the intent of the Secretary to 
     exercise the authority of the Secretary under this 
     paragraph.''.

     SEC. 749. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--Section 338 of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 1988) is amended--
       (1) by striking subsections (b), (c), (d), and (e); and
       (2) by redesignating subsection (f) as subsection (b).
       (b) Conforming Amendments.--
       (1) The first sentence of section 309(g)(1) of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 
     1929(g)(1)) is amended by inserting after ``section 338(c)'' 
     the following: ``(before the amendment made by section 
     749(a)(1) of the Federal Agriculture Improvement and Reform 
     Act of 1996)''.
       (2) Section 343(b) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1991(b)) is amended by striking 
     ``338(f),'' and inserting ``338(b),''.

     SEC. 750. TESTIMONY BEFORE CONGRESSIONAL COMMITTEES.

       Section 345 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1993) is repealed.

     SEC. 751. PROHIBITION ON USE OF LOANS FOR CERTAIN PURPOSES.

       Section 363 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 2006e) is amended by adding at the end the 
     following: ``This section shall not apply to a loan made or 
     guaranteed under this title for a utility line.''.

     SEC. 752. RURAL DEVELOPMENT CERTIFIED LENDERS PROGRAM.

       The Consolidated Farm and Rural Development Act is amended 
     by inserting after section 363 (7 U.S.C. 2006e) the 
     following:

     ``SEC. 364. RURAL DEVELOPMENT CERTIFIED LENDERS PROGRAM.

       ``(a) Certified Lenders Program.--
       ``(1) In general.--The Secretary may establish a program 
     under which the Secretary may guarantee a loan for any rural 
     development program that is made by a lender certified by the 
     Secretary.
       ``(2) Certification requirements.--The Secretary may 
     certify a lender if the lender meets such criteria as the 
     Secretary may prescribe in regulations, including the ability 
     of the lender to properly make, service, and liquidate the 
     guaranteed loans of the lender.
       ``(3) Condition of certification.--As a condition of 
     certification, the Secretary may require the lender to 
     undertake to service the guaranteed loan using standards that 
     are not less stringent than generally accepted banking 
     standards concerning loan servicing that are used by prudent 
     commercial or cooperative lenders.
       ``(4) Guarantee.--Notwithstanding any other provision of 
     law, the Secretary may guarantee not more than 80 percent of 
     a loan made by a certified lender described in paragraph (1), 
     if the borrower of the loan meets the eligibility 
     requirements and such other criteria for the loan guarantee 
     that are established by the Secretary.
       ``(5) Certifications.--With respect to loans to be 
     guaranteed, the Secretary may permit a certified lender to 
     make appropriate certifications (as provided in regulations 
     issued by the Secretary)--
       ``(A) relating to issues such as creditworthiness, 
     repayment ability, adequacy of collateral, and feasibility of 
     the operation; and
       ``(B) that the borrower is in compliance with all 
     requirements of law, including regulations issued by the 
     Secretary.
       ``(6) Relationship to other requirements.--This subsection 
     shall not affect the responsibility of the Secretary to 
     determine eligibility, review financial information, and 
     otherwise assess an application.
       ``(b) Preferred Certified Lenders Program.--
       ``(1) In general.--The Secretary may establish a preferred 
     certified lenders program for lenders who establish their--
       ``(A) knowledge of, and experience under, the program 
     established under subsection (a);
       ``(B) knowledge of the regulations concerning the 
     particular guaranteed loan program; and
       ``(C) proficiency related to the certified lender program 
     requirements.
       ``(2) Additional lending institutions.--The Secretary may 
     certify any lending institution as

[[Page H2780]]

     a preferred certified lender if the institution meets such 
     additional criteria as the Secretary may prescribe by 
     regulation.
       ``(3) Revocation of designation.--The designation of a 
     lender as a preferred certified lender shall be revoked if 
     the Secretary determines that the lender is not adhering to 
     the rules and regulations applicable to the program or if the 
     loss experiences of the preferred certified lender are 
     greater than other preferred certified lenders, except that 
     the suspension or revocation shall not affect any outstanding 
     guarantee.
       ``(4) Condition of certification.--As a condition of the 
     preferred certification, the Secretary shall require the 
     lender to undertake to service the loan guaranteed by the 
     Secretary under this subsection using generally accepted 
     banking standards concerning loan servicing employed by 
     prudent commercial or cooperative lenders. The Secretary 
     shall, at least annually, monitor the performance of each 
     preferred certified lender to ensure that the conditions of 
     the certification are being met.
       ``(5) Effect of preferred lender certification.--
     Notwithstanding any other provision of law, the Secretary 
     may--
       ``(A) guarantee not more than 80 percent of any approved 
     loan made by a preferred certified lender as described in 
     this subsection, if the borrower meets the eligibility 
     requirements and such other criteria as may be applicable to 
     loans guaranteed by the Secretary; and
       ``(B) permit preferred certified lenders to make all 
     decisions, with respect to loans to be guaranteed by the 
     Secretary under this subsection relating to creditworthiness, 
     the closing, monitoring, collection, and liquidation of 
     loans, and to accept appropriate certifications, as provided 
     in regulations issued by the Secretary, that the borrower is 
     in compliance with all requirements of law and regulations 
     issued by the Secretary.''.

     SEC. 753. SYSTEM FOR DELIVERY OF CERTAIN RURAL DEVELOPMENT 
                   PROGRAMS.

       (a) In General.--Section 365 of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 2008) is repealed.
       (b) Conforming Amendments.--
       (1) Section 2375 of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (7 U.S.C. 6613) is amended--
       (A) in subsection (e), by striking ``, as defined in 
     section 365(b)(2) of the Consolidated Farm and Rural 
     Development Act,''; and
       (B) by adding at the end the following:
       ``(g) Definition of Designated Rural Development Program.--
     In this section, the term `designated rural development 
     program' means a program carried out under section 304(b), 
     306(a), or 310B(e) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1924(b), 1926(a), and 1932(e)) for 
     which funds are available at any time during the fiscal 
     year.''.
       (2) Paragraph (2) of section 233(b) of the Department of 
     Agriculture Reorganization Act of 1994 (7 U.S.C. 6943(b)) (as 
     redesignated by section 747(b)(3)(B)) is amended by striking 
     ``sections 365 through 369 of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 2008-2008d)'' and inserting 
     ``section 369 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 2008d)''.

     SEC. 754. STATE RURAL ECONOMIC DEVELOPMENT REVIEW PANEL.

       Section 366 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 2008a) is repealed.

     SEC. 755. LIMITED TRANSFER AUTHORITY OF LOAN AMOUNTS.

       Section 367 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 2008b) is repealed.

     SEC. 756. ALLOCATION AND TRANSFER OF LOAN GUARANTEE 
                   AUTHORITY.

       Section 368 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 2008c) is repealed.

     SEC. 757. WATER SYSTEMS FOR RURAL AND NATIVE VILLAGES IN 
                   ALASKA.

       The Consolidated Farm and Rural Development Act is amended 
     by inserting after section 306C (7 U.S.C. 1926c) the 
     following:

     ``SEC. 306D. WATER SYSTEMS FOR RURAL AND NATIVE VILLAGES IN 
                   ALASKA.

       ``(a) In General.--The Secretary may make grants to the 
     State of Alaska for the benefit of rural or Native villages 
     in Alaska to provide for the development and construction of 
     water and wastewater systems to improve the health and 
     sanitation conditions in those villages.
       ``(b) Matching Funds.--To be eligible to receive a grant 
     under subsection (a), the State of Alaska shall provide equal 
     matching funds from non-Federal sources.
       ``(c) Consultation With the State of Alaska.--The Secretary 
     shall consult with the State of Alaska on a method of 
     prioritizing the allocation of grants under subsection (a) 
     according to the needs of, and relative health and sanitation 
     conditions in, each village.
       ``(d) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section 
     $15,000,000 for each of fiscal years 1996 through 2002.''.

     SEC. 758. APPLICATION REQUIREMENTS RELATING TO WATER AND 
                   WASTE DISPOSAL LOAN AND GRANT PROGRAMS.

       Section 306(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 926(a)) is amended by inserting 
     after paragraph (4) the following:
       ``(5) Application requirements.--Not earlier than 60 days 
     before a preliminary application is filed for a loan under 
     paragraph (1) or a grant under paragraph (2) for a water or 
     waste disposal purpose, a notice of the intent of the 
     applicant to apply for the loan or grant shall be published 
     in a general circulation newspaper. The selection of 
     engineers for a project design shall be done by a request for 
     proposals by the applicant.''.

     SEC. 759. NATIONAL SHEEP INDUSTRY IMPROVEMENT CENTER.

       The Consolidated Farm and Rural Development Act (as amended 
     by section 649) is amended by adding at the end the 
     following:

     ``SEC. 375. NATIONAL SHEEP INDUSTRY IMPROVEMENT CENTER.

       ``(a) Definitions.--In this section:
       ``(1) Board.--The term `Board' means the Board of Directors 
     established under subsection (f).
       ``(2) Center.--The term `Center' means the National Sheep 
     Industry Improvement Center established under subsection (b).
       ``(3) Eligible entity.--The term `eligible entity' means an 
     entity that promotes the betterment of the United States 
     sheep or goat industries and that is--
       ``(A) a public, private, or cooperative organization;
       ``(B) an association, including a corporation not operated 
     for profit;
       ``(C) a federally recognized Indian Tribe; or
       ``(D) a public or quasi-public agency.
       ``(4) Fund.--The term `Fund' means the National Sheep 
     Industry Improvement Center Revolving Fund established under 
     subsection (e).
       ``(b) Establishment of Center.--The Secretary shall 
     establish a National Sheep Industry Improvement Center.
       ``(c) Purposes.--The purposes of the Center shall be to--
       ``(1) promote strategic development activities and 
     collaborative efforts by private and State entities to 
     maximize the impact of Federal assistance to strengthen and 
     enhance production and marketing of sheep or goat products in 
     the United States;
       ``(2) optimize the use of available human capital and 
     resources within the sheep or goat industries;
       ``(3) provide assistance to meet the needs of the sheep or 
     goat industry for infrastructure development, business 
     development, production, resource development, and market and 
     environmental research;
       ``(4) advance activities that empower and build the 
     capacity of the United States sheep or goat industry to 
     design unique responses to the special needs of the sheep or 
     goat industries on both a regional and national basis; and
       ``(5) adopt flexible and innovative approaches to solving 
     the long-term needs of the United States sheep or goat 
     industry.
       ``(d) Strategic Plan.--
       ``(1) In general.--The Center shall submit to the Secretary 
     an annual strategic plan for the delivery of financial 
     assistance provided by the Center.
       ``(2) Requirements.--A strategic plan shall identify--
       ``(A) goals, methods, and a benchmark for measuring the 
     success of carrying out the plan and how the plan relates to 
     the national and regional goals of the Center;
       ``(B) the amount and sources of Federal and non-Federal 
     funds that are available for carrying out the plan;
       ``(C) funding priorities;
       ``(D) selection criteria for funding; and
       ``(E) a method of distributing funding.
       ``(e) Revolving Fund.--
       ``(1) Establishment.--There is established in the Treasury 
     the National Sheep Industry Improvement Center Revolving 
     Fund. The Fund shall be available to the Center, without 
     fiscal year limitation, to carry out the authorized programs 
     and activities of the Center under this section.
       ``(2) Contents of fund.--There shall be deposited in the 
     Fund--
       ``(A) such amounts as may be appropriated, transferred, or 
     otherwise made available to support programs and activities 
     of the Center;
       ``(B) payments received from any source for products, 
     services, or property furnished in connection with the 
     activities of the Center;
       ``(C) fees and royalties collected by the Center from 
     licensing or other arrangements relating to commercialization 
     of products developed through projects funded, in whole or 
     part, by grants, contracts, or cooperative agreements 
     executed by the Center;
       ``(D) proceeds from the sale of assets, loans, and equity 
     interests made in furtherance of the purposes of the Center;
       ``(E) donations or contributions accepted by the Center to 
     support authorized programs and activities; and
       ``(F) any other funds acquired by the Center.
       ``(3) Use of fund.--
       ``(A) In general.--The Center may use amounts in the Fund 
     to make grants and loans to eligible entities in accordance 
     with a strategic plan submitted under subsection (d).
       ``(B) Continued existence.--The Center shall manage the 
     Fund in a manner that ensures that sufficient amounts are 
     available in the Fund to carry out subsection (c).
       ``(C) Diverse area.--The Center shall, to the maximum 
     extent practicable, use the Fund to serve broad geographic 
     areas and regions of diverse production.
       ``(D) Variety of loans and grants.--The Center shall, to 
     the maximum extent practicable, use the Fund to provide a 
     variety of grants and intermediate- and long-term loans.
       ``(E) Administration.--The Center may not use more than 3 
     percent of the amounts in the Fund for a fiscal year for the 
     administration of the Center.
       ``(F) Influencing legislation.--None of the amounts in the 
     Fund may be used to influence legislation.
       ``(G) Accounting.--To be eligible to receive amounts from 
     the Fund, an entity must agree to account for the amounts 
     using generally accepted accounting principles.
       ``(H) Uses of fund.--The Center may use amounts in the Fund 
     to--

[[Page H2781]]

       ``(i) participate with Federal and State agencies in 
     financing activities that are in accordance with a strategic 
     plan submitted under subsection (d), including participation 
     with several States in a regional effort;
       ``(ii) participate with other public and private funding 
     sources in financing activities that are in accordance with 
     the strategic plan, including participation in a regional 
     effort;
       ``(iii) provide security for, or make principal or interest 
     payments on, revenue or general obligation bonds issued by a 
     State, if the proceeds from the sale of the bonds are 
     deposited in the Fund;
       ``(iv) accrue interest;
       ``(v) guarantee or purchase insurance for local obligations 
     to improve credit market access or reduce interest rates for 
     a project that is in accordance with the strategic plan; or
       ``(vi) sell assets, loans, and equity interests acquired in 
     connection with the financing of projects funded by the 
     Center.
       ``(4) Loans.--
       ``(A) Rate.--A loan from the Fund may be made at an 
     interest rate that is below the market rate or may be 
     interest free.
       ``(B) Term.--The term of a loan may not exceed the shorter 
     of--
       ``(i) the useful life of the activity financed; or
       ``(ii) 40 years.
       ``(C) Source of repayment.--The Center may not make a loan 
     from the Fund unless the recipient establishes an assured 
     source of repayment.
       ``(D) Proceeds.--All payments of principal and interest on 
     a loan made from the Fund shall be deposited into the Fund.
       ``(5) Maintenance of effort.--The Center shall use the Fund 
     only to supplement and not to supplant Federal, State, and 
     private funds expended for rural development.
       ``(6) Funding.--
       ``(A) Deposit of funds.--All Federal and non-Federal 
     amounts received by the Center to carry out this section 
     shall be deposited in the Fund.
       ``(B) Mandatory funds.--Out of any moneys in the Treasury 
     not otherwise appropriated, the Secretary of the Treasury 
     shall provide to the Center not to exceed $20,000,000 to 
     carry out this section.
       ``(C) Additional funds.--In addition to any funds provided 
     under subparagraph (B), there is authorized to be 
     appropriated $30,000,000 to carry out this section.
       ``(D) Privatization.--No additional Federal funds shall be 
     used to carry out this section beginning on the earlier of--
       ``(i) the date that is 10 years after the date of enactment 
     of this section; or
       ``(ii) the day after a total of $50,000,000 has been made 
     available under subparagraphs (B) and (C) to carry out this 
     section.
       ``(f) Board of Directors.--
       ``(1) In general.--The management of the Center shall be 
     vested in a Board of Directors.
       ``(2) Powers.--The Board shall--
       ``(A) be responsible for the general supervision of the 
     Center;
       ``(B) review any grant, loan, contract, or cooperative 
     agreement to be made or entered into by the Center and any 
     financial assistance provided to the Center;
       ``(C) make the final decision, by majority vote, on whether 
     and how to provide assistance to an applicant; and
       ``(D) develop and establish a budget plan and a long-term 
     operating plan to carry out the goals of the Center.
       ``(3) Composition.--The Board shall be composed of--
       ``(A) 7 voting members, of whom--
       ``(i) 4 members shall be active producers of sheep or goats 
     in the United States;
       ``(ii) 2 members shall have expertise in finance and 
     management; and
       ``(iii) 1 member shall have expertise in lamb, wool, goat, 
     or goat product marketing; and
       ``(B) 2 nonvoting members, of whom--
       ``(i) 1 member shall be the Under Secretary of Agriculture 
     for Rural Development; and
       ``(ii) 1 member shall be the Under Secretary of Agriculture 
     for Research, Education, and Economics.
       ``(4) Nomination.--
       ``(A) Nominating body.--The Secretary shall appoint the 
     voting members of the Board from nominations submitted by 
     organizations described in subparagraph (B).
       ``(B) National organizations.--A national organization is 
     described in this subparagraph if the organization--
       ``(i) consists primarily of active sheep or goat producers 
     in the United States; and
       ``(ii) has as the primary interest of the organization the 
     production of sheep or goats in the United States.
       ``(5) Term of office.--
       ``(A) In general.--Subject to subparagraph (B), the term of 
     office of a voting member of the Board shall be 3 years.
       ``(B) Staggered initial terms.--The initial voting members 
     of the Board (other than the chairperson of the initially 
     established Board) shall serve for staggered terms of 1, 2, 
     and 3 years, as determined by the Secretary.
       ``(C) Reelection.--A voting member may be reelected for not 
     more than 1 additional term.
       ``(6) Vacancy.--
       ``(A) In general.--A vacancy on the Board shall be filled 
     in the same manner as the original Board.
       ``(B) Reelection.--A member elected to fill a vacancy for 
     an unexpired term may be reelected for 1 full term.
       ``(7) Chairperson.--
       ``(A) In general.--The Board shall select a chairperson 
     from among the voting members of the Board.
       ``(B) Term.--The term of office of the chairperson shall be 
     2 years.
       ``(8) Annual meeting.--
       ``(A) In general.--The Board shall meet not less than once 
     each fiscal year at the call of the chairperson or at the 
     request of the executive director appointed under subsection 
     (g)(1).
       ``(B) Location.--The location of a meeting of the Board 
     shall be established by the Board.
       ``(9) Voting.--
       ``(A) Quorum.--A quorum of the Board shall consist of a 
     majority of the voting members.
       ``(B) Majority vote.--A decision of the Board shall be made 
     by a majority of the voting members of the Board.
       ``(10) Conflicts of interest.--
       ``(A) In general.--Except as provided in subparagraph (D), 
     a member of the Board shall not vote on any matter respecting 
     any application, contract, claim, or other particular matter 
     pending before the Board in which, to the knowledge of the 
     member, an interest is held by--
       ``(i) the member;
       ``(ii) any spouse of the member;
       ``(iii) any child of the member;
       ``(iv) any partner of the member;
       ``(v) any organization in which the member is serving as an 
     officer, director, trustee, partner, or employee; or
       ``(vi) any person with whom the member is negotiating or 
     has any arrangement concerning prospective employment or with 
     whom the member has a financial interest.
       ``(B) Removal.--Any action by a member of the Board that 
     violates subparagraph (A) shall be cause for removal from the 
     Board.
       ``(C) Validity of action.--An action by a member of the 
     Board that violates subparagraph (A) shall not impair or 
     otherwise affect the validity of any otherwise lawful action 
     by the Board.
       ``(D) Disclosure.--
       ``(i) In general.--If a member of the Board makes a full 
     disclosure of an interest and, prior to any participation by 
     the member, the Board determines, by majority vote, that the 
     interest is too remote or too inconsequential to affect the 
     integrity of any participation by the member, the member may 
     participate in the matter relating to the interest, except as 
     provided in subparagraph (E)(iii).
       ``(ii) Vote.--A member that discloses an interest under 
     clause (i) shall not vote on a determination of whether the 
     member may participate in the matter relating to the 
     interest.
       ``(E) Remands.--
       ``(i) In general.--The Secretary may vacate and remand to 
     the Board for reconsideration any decision made pursuant to 
     subsection (e)(3)(H) if the Secretary determines that there 
     has been a violation of this paragraph or any conflict of 
     interest provision of the bylaws of the Board with respect to 
     the decision.
       ``(ii) Reasons.--In the case of any violation and remand of 
     a funding decision to the Board under clause (i), the 
     Secretary shall inform the Board of the reasons for the 
     remand.
       ``(iii) Conflicted members not to vote on remanded 
     decisions.--If a decision with respect to a matter is 
     remanded to the Board by reason of a conflict of interest 
     faced by a Board member, the member may not participate in 
     any subsequent decision with respect to the matter.
       ``(11) Compensation.--
       ``(A) In general.--A member of the Board shall not receive 
     any compensation by reason of service on the Board.
       ``(B) Expenses.--A member of the Board shall be reimbursed 
     for travel, subsistence, and other necessary expenses 
     incurred by the member in the performance of a duty of the 
     member.
       ``(12) Bylaws.--The Board shall adopt, and may from time to 
     time amend, any bylaw that is necessary for the proper 
     management and functioning of the Center.
       ``(13) Public hearings.--Not later than 1 year after the 
     date of enactment of this section, the Board shall hold 
     public hearings on policy objectives of the program 
     established under this section.
       ``(14) Organizational system.--The Board shall provide a 
     system of organization to fix responsibility and promote 
     efficiency in carrying out the functions of the Board.
       ``(15) Use of department of agriculture.--The Board may, 
     with the consent of the Secretary, utilize the facilities of 
     and the services of employees of the Department of 
     Agriculture, without cost to the Center.
       ``(g) Officers and Employees.--
       ``(1) Executive director.--
       ``(A) In general.--The Board shall appoint an executive 
     director to be the chief executive officer of the Center.
       ``(B) Tenure.--The executive director shall serve at the 
     pleasure of the Board.
       ``(C) Compensation.--Compensation for the executive 
     director shall be established by the Board.
       ``(2) Other officers and employees.--The Board may select 
     and appoint officers, attorneys, employees, and agents who 
     shall be vested with such powers and duties as the Board may 
     determine.
       ``(3) Delegation.--The Board may, by resolution, delegate 
     to the chairperson, the executive director, or any other 
     officer or employee any function, power, or duty of the Board 
     other than voting on a grant, loan, contract, agreement, 
     budget, or annual strategic plan.
       ``(h) Consultation.--To carry out this section, the Board 
     may consult with--
       ``(1) State departments of agriculture;
       ``(2) Federal departments and agencies;
       ``(3) nonprofit development corporations;
       ``(4) colleges and universities;
       ``(5) banking and other credit-related agencies;
       ``(6) agriculture and agribusiness organizations; and
       ``(7) regional planning and development organizations.
       ``(i) Oversight.--
       ``(1) In general.--The Secretary shall review and monitor 
     compliance by the Board and the Center with this section.

[[Page H2782]]

       ``(2) Sanctions.--If, following notice and opportunity for 
     a hearing, the Secretary finds that the Board or the Center 
     is not in compliance with this section, the Secretary may--
       ``(A) cease making deposits to the Fund;
       ``(B) suspend the authority of the Center to withdraw funds 
     from the Fund; or
       ``(C) impose other appropriate sanctions, including 
     recoupment of money improperly expended for purposes 
     prohibited or not authorized by this Act and disqualification 
     from receipt of financial assistance under this section.
       ``(3) Rescission of sanctions.--The Secretary shall rescind 
     sanctions imposed under paragraph (2) on a finding by the 
     Secretary that there is no longer any failure by the Board or 
     the Center to comply with this section or that the 
     noncompliance will be promptly corrected.''.

     SEC. 759A. COOPERATIVE AGREEMENTS.

       Section 607(b) of the Rural Development Act of 1972 (7 
     U.S.C. 2204b(b)) is amended by striking paragraph (4) and 
     inserting the following:
       ``(4) Cooperative agreements.--
       ``(A) In general.--Notwithstanding chapter 63 of title 31, 
     United States Code, the Secretary may enter into cooperative 
     agreements with other Federal agencies, State and local 
     governments, and any other organization or individual to 
     improve the coordination and effectiveness of Federal 
     programs, services, and actions affecting rural areas, 
     including the establishment and financing of interagency 
     groups, if the Secretary determines that the objectives of 
     the agreement will serve the mutual interest of the parties 
     in rural development activities.
       ``(B) Cooperators.--Each cooperator, including each Federal 
     agency, to the extent that funds are otherwise available, may 
     participate in any cooperative agreement or working group 
     established pursuant to this paragraph by contributing funds 
     or other resources to the Secretary to carry out the 
     agreement or functions of the group.''.

     SEC. 759B. ELIGIBILITY FOR GRANTS TO BROADCASTING SYSTEMS.

       Section 310B(f) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1932(f)) (as redesignated by 
     section 747(a)(6))) is amended by striking ``Systems.--The'' 
     and inserting ``Systems.--
       ``(1) Definition of statewide.--In this subsection, the 
     term `statewide' means having a coverage area of not less 
     than 90 percent of the population of a State and not less 
     than 80 percent of the rural land area of the State (as 
     determined by the Secretary).
       ``(2) Grants.--The''.

             CHAPTER 2--RURAL COMMUNITY ADVANCEMENT PROGRAM

     SEC. 761. RURAL COMMUNITY ADVANCEMENT PROGRAM.

       The Consolidated Farm and Rural Development Act (7 U.S.C. 
     1921 et seq.) is amended by adding at the end the following:
           ``Subtitle E--Rural Community Advancement Program

     ``SEC. 381A. DEFINITIONS.

       ``In this subtitle:
       ``(1) Rural and rural area.--The terms `rural' and `rural 
     area' mean, subject to section 306(a)(7), a city, town, or 
     unincorporated area that has a population of 50,000 
     inhabitants or less, other than an urbanized area immediately 
     adjacent to a city, town, or unincorporated area that has a 
     population in excess of 50,000 inhabitants.
       ``(2) State.--The term `State' means each of the 50 States, 
     the District of Columbia, the Commonwealth of Puerto Rico, 
     Guam, the Virgin Islands of the United States, American 
     Samoa, the Commonwealth of the Northern Mariana Islands, the 
     Trust Territory of the Pacific Islands, and the Federated 
     States of Micronesia.
       ``(3) State director.--The term `State director' means, 
     with respect to a State, the Director of the Rural Economic 
     and Community Development State Office.

     ``SEC. 381B. ESTABLISHMENT.

       ``The Secretary shall establish a rural community 
     advancement program to provide grants, loans, loan 
     guarantees, and other assistance to meet the rural 
     development needs of local communities in States and 
     federally recognized Indian tribes.

     ``SEC. 381C. NATIONAL OBJECTIVES.

       ``The national objectives of the program established under 
     this subtitle shall be to--
       ``(1) promote strategic development activities and 
     collaborative efforts by State and local communities, and 
     federally recognized Indian tribes, to maximize the impact of 
     Federal assistance;
       ``(2) optimize the use of resources;
       ``(3) provide assistance in a manner that reflects the 
     complexity of rural needs, including the needs for business 
     development, health care, education, infrastructure, cultural 
     resources, the environment, and housing;
       ``(4) advance activities that empower, and build the 
     capacity of, State and local communities to design unique 
     responses to the special needs of the State and local 
     communities, and federally recognized Indian tribes, for 
     rural development assistance; and
       ``(5) adopt flexible and innovative approaches to solving 
     rural development problems.

     ``SEC. 381D. STRATEGIC PLANS.

       ``(a) In General.--The Secretary shall direct each of the 
     Directors of Rural Economic and Community Development State 
     Offices to prepare a strategic plan--
       ``(1) for each State for the delivery of assistance under 
     this subtitle in the State; and
       ``(2) for each federally recognized Indian tribe for the 
     delivery of assistance under this subtitle to the Indian 
     tribe.
       ``(b) Assistance.--
       ``(1) In general.--Financial assistance for rural 
     development provided under this subtitle for a State or a 
     federally recognized Indian tribe shall be used only for 
     orderly community development that is consistent with the 
     strategic plan of the State or Indian tribe.
       ``(2) Rural area.--Assistance under this subtitle may only 
     be provided in a rural area.
       ``(3) Small communities.--In carrying out this subtitle in 
     a State, the Secretary shall give priority to communities 
     with the smallest populations and lowest per capita income.
       ``(c) Review.--The Secretary shall review the strategic 
     plan of each State and federally recognized Indian tribe not 
     later than 60 days after receiving the plan, and at least 
     once every 5 years thereafter.
       ``(d) Contents.--A strategic plan of a State or federally 
     recognized Indian tribe under this section shall be a plan 
     that--
       ``(1) coordinates economic, human, and community 
     development plans and related activities proposed for an 
     affected area;
       ``(2) provides that the State or federally recognized 
     Indian tribe, as appropriate, and an affected community 
     (including local institutions and organizations that have 
     contributed to the planning process) shall act as full 
     partners in the process of developing and implementing the 
     plan;
       ``(3) identifies goals, methods, and benchmarks for 
     measuring the success of carrying out the plan and how the 
     plan relates to local or regional ecosystems;
       ``(4) in the case of a State, provides for the involvement, 
     in the preparation of the plan, of State, local, private, and 
     public persons, State rural development councils, federally 
     recognized Indian tribes in the State, and community-based 
     organizations;
       ``(5) identifies the amount and source of Federal and non-
     Federal resources that are available for carrying out the 
     plan; and
       ``(6) includes such other information as may be required by 
     the Secretary.

     ``SEC. 381E. RURAL DEVELOPMENT TRUST FUND.

       ``(a) Establishment.--There is established in the Treasury 
     of the United States a trust fund which shall be known as the 
     Rural Development Trust Fund (in this subtitle referred to as 
     the `Trust Fund').
       ``(b) Accounts.--There are established in the Trust Fund 
     the following accounts:
       ``(1) The rural community facilities account.
       ``(2) The rural utilities account.
       ``(3) The rural business and cooperative development 
     account.
       ``(4) The national reserve account.
       ``(5) The federally recognized Indian tribe account.
       ``(c) Deposits Into Accounts.--Notwithstanding any other 
     provision of law, each fiscal year--
       ``(1) all amounts made available to carry out the 
     authorities described in subsection (d)(1) for the fiscal 
     year shall be deposited into the rural community facilities 
     account of the Trust Fund;
       ``(2) all amounts made available to carry out the 
     authorities described in subsection (d)(2) for the fiscal 
     year shall be deposited into the rural utilities account of 
     the Trust Fund; and
       ``(3) all amounts made available to carry out the 
     authorities described in subsection (d)(3) for the fiscal 
     year shall be deposited into the rural business and 
     cooperative development account of the Trust Fund.
       ``(d) Function Categories.--The function categories 
     described in this subsection are the following:
       ``(1) Rural community facilities.--The rural community 
     development category consists of all amounts made available 
     for--
       ``(A) community facility direct and guaranteed loans under 
     section 306(a)(1); or
       ``(B) community facility grants under section 306(a)(19).
       ``(2) Rural utilities.--The rural utilities category 
     consists of all amounts made available for--
       ``(A) water or waste disposal grants or direct or 
     guaranteed loans under paragraph (1) or (2) of section 
     306(a);
       ``(B) rural water or wastewater technical assistance and 
     training grants under section 306(a)(14);
       ``(C) emergency community water assistance grants under 
     section 306A; or
       ``(D) solid waste management grants under section 310B(b).
       ``(3) Rural business and cooperative development.--The 
     rural business and cooperative development category consists 
     of all amounts made available for--
       ``(A) rural business opportunity grants under section 
     306(a)(11)(A);
       ``(B) business and industry guaranteed loans under section 
     310B(a)(1); or
       ``(C) rural business enterprise grants or rural educational 
     network grants under section 310B(c).
       ``(e) National Reserve Account.--
       ``(1) Transfers into account.--
       ``(A) Initial transfer.--Each fiscal year, the Secretary 
     shall transfer to the national reserve account of the Trust 
     Fund from each account specified in subsection (c) not more 
     than the applicable percentage of the amount deposited in 
     each such account for the fiscal year under subsection (c).
       ``(B) Repooling of unobligated funds allocated among the 
     states.--Not earlier than July 15 of each fiscal year, the 
     Secretary shall transfer to the national reserve account from 
     each account specified in subsection (c) any amount in the 
     account that is allocated for any State, and has not been 
     obligated by the State director or obligated for specific 
     approved projects in the State.
       ``(2) Use.--The Secretary may use amounts in the national 
     reserve account of the Trust Fund, pursuant to any authority 
     described in subsection (d)--
       ``(A) in the case of a fiscal year other than fiscal year 
     2001 or 2002--
       ``(i) to meet situations of exceptional need;
       ``(ii) to meet emergency situations; or

[[Page H2783]]

       ``(iii) to provide funds to entities whose applications for 
     funds provided under this subtitle have been approved and who 
     have not received funds sufficient to meet the needs of the 
     projects described in the applications; or
       ``(B) in the case of fiscal years 2001 and 2002--
       ``(i) to meet situations of exceptional need; or
       ``(ii) to meet emergency situations.
       ``(3) Applicable percentage defined.--In paragraph (1), the 
     term `applicable percentage' means, with respect to a fiscal 
     year--
       ``(A) 15 percent for fiscal year 1997;
       ``(B) 12.5 percent for fiscal year 1998;
       ``(C) 10 percent for fiscal year 1999;
       ``(D) 7.5 percent for fiscal year 2000;
       ``(E) 5 percent for fiscal year 2001; and
       ``(F) 5 percent for fiscal year 2002.
       ``(f) Federally Recognized Indian Tribe Account.--
       ``(1) Transfers into account.--Each fiscal year, the 
     Secretary shall transfer to the federally recognized Indian 
     tribe account of the Trust Fund 3 percent of the amount 
     deposited into the Trust Fund for the fiscal year under 
     subsection (d).
       ``(2) Use of funds.--The Secretary shall make available to 
     federally recognized Indian tribes the amounts in the 
     federally recognized Indian tribe account for use pursuant to 
     any authority described in subsection (d).
       ``(g) Allocation Among States.--The Secretary shall 
     allocate the amounts in each account specified in subsection 
     (c) among the States in a fair, reasonable, and appropriate 
     manner that takes into consideration rural population, levels 
     of income, unemployment, and other relevant factors, as 
     determined by the Secretary.
       ``(h) Availability of Funds Allocated for States.--The 
     Secretary shall make available to each State the total amount 
     allocated for the State under subsection (g) of this section 
     that remains after applying section 381G.

     ``SEC. 381F. TRANSFERS OF FUNDS.

       ``(a) General Authority.--Subject to subsection (b) of this 
     section, the State Director of any State may, during any 
     fiscal year, transfer from each account specified in section 
     381E(c) a total of not more than 25 percent of the amount in 
     the account that is allocated for the State for the fiscal 
     year to any other account in which amounts are allocated for 
     the State for the fiscal year.
       ``(b) Limitation.--Except as provided in subsection (c) of 
     this section, a transfer otherwise authorized by subsection 
     (a) of this section to be made during a fiscal year may not 
     be made to the extent that the sum of the amount to be 
     transferred and all amounts so transferred by State directors 
     under subsection (a) of this section during the fiscal year 
     exceeds 10 percent of the total amount made available to 
     carry out the authorities described in section 381E(d) for 
     the fiscal year.
       ``(c) Exceptions.--Subsections (a) and (b) shall not apply 
     to a transfer of funds by a State director if the State 
     director certifies to the Secretary that--
       ``(1) there is an approved application for a project in the 
     function category to which the funds are to be transferred 
     but funds are not available for the project in the function 
     category; and
       ``(2)(A) there is no such approved application in the 
     function category from which the funds are to be transferred; 
     or
       ``(B) the community that would benefit from the project has 
     a smaller population and a lesser per capita income than any 
     community that would benefit from a project in the function 
     category from which the funds are to be transferred.

     ``SEC. 381G. GRANTS TO STATES.

       ``(a) Simple Grants.--
       ``(1) Mandatory grant.--The Secretary shall make a grant to 
     any eligible State for any fiscal year for which the State 
     requests a grant under this section in an amount equal to 5 
     percent of the total amount allocated for the State under 
     section 381E(g)
       ``(2) Permissive grant.--Before July 15 of each fiscal 
     year, the Secretary may make a grant to any State to defray 
     the cost of any subsidy associated with a guarantee provided 
     by an eligible public entity of the State under section 381H 
     in an amount that does not exceed 5 percent of the total 
     amount allocated for the State under section 381E(g).
       ``(3) Source of funds.--The Secretary shall make grants to 
     a State under paragraphs (1) and (2) from amounts allocated 
     for the State in the accounts specified in section 381E(c), 
     by reducing each such allocated amount by the same 
     percentage.
       ``(b) Matching Grants.--
       ``(1) In general.--Subject to paragraph (2), the Secretary 
     shall make a grant to any eligible State for any fiscal year 
     for which the State requests a grant under this section in an 
     amount equal to 5 percent of the amount allocated for the 
     State for the fiscal year under section 381E(h).
       ``(2) Eligibility.--A State shall be eligible for a grant 
     under paragraph (1) if the State makes commitments to the 
     Secretary to--
       ``(A) expend from non-Federal sources in accordance with 
     subsection (c) an amount that is not less than 200 percent of 
     the amount of the grant; and
       ``(B) maintain the amounts paid to the State under this 
     subsection and the amount referred to in subparagraph (A) in 
     an account separate from all other State funds until expended 
     in accordance with subsection (c).
       ``(3) Source of funds.--If the Secretary makes a grant 
     under paragraph (1) before July 15 of the fiscal year, the 
     grant shall be made from amounts allocated for the State in 
     the accounts specified in section 381E(c) for the fiscal 
     year, by reducing each allocated amount by the same 
     percentage.
       ``(c) Use of Funds.--A State to which funds are provided 
     under this section shall use the funds in rural areas for any 
     activity authorized under the authorities described in 
     section 381E(d) in accordance with the State strategic plan 
     referred to in section 381D.
       ``(d) Maintenance of Effort.--The State shall provide 
     assurances to the Secretary that funds provided to the State 
     under this section will be used only to supplement, not to 
     supplant, the amount of Federal, State, and local funds 
     otherwise expended for rural development assistance in the 
     State.
       ``(e) Appeals.--The Secretary shall provide to a State an 
     opportunity to appeal any action taken with respect to the 
     State under this section.
       ``(f) Administrative Costs.--Federal funds shall not be 
     used for any administrative costs incurred by a State in 
     carrying out this subtitle.
       ``(g) Expenditure of Funds by State.--
       ``(1) In general.--Payments to a State from a grant under 
     this section for a fiscal year shall be obligated by the 
     State in the fiscal year or in the succeeding fiscal year. A 
     State shall obligate funds under this section to provide 
     assistance to rural areas.
       ``(2) Failure to obligate.--If a State fails to obligate 
     payments in accordance with paragraph (1), the Secretary 
     shall make an equal reduction in the amount of payments 
     provided to the State under this section for the immediately 
     succeeding fiscal year.
       ``(3) Noncompliance.--
       ``(A) Review.--The Secretary shall review and monitor State 
     compliance with this section.
       ``(B) Penalty.--If the Secretary finds that there has been 
     misuse of grant funds provided under this section, or 
     noncompliance with any of the terms and conditions of a 
     grant, after reasonable notice and opportunity for a 
     hearing--
       ``(i) the Secretary shall notify the State of the finding; 
     and
       ``(ii) no further payments to the State shall be made with 
     respect to the programs funded under this section until the 
     Secretary is satisfied that there is no longer any failure to 
     comply or that the noncompliance will be promptly corrected.
       ``(C) Other sanctions.--In the case of a finding of 
     noncompliance made pursuant to subparagraph (B), the 
     Secretary may, in addition to, or in lieu of, imposing the 
     sanctions described in subparagraph (B), impose other 
     appropriate sanctions, including recoupment of money 
     improperly expended for purposes prohibited or not authorized 
     by this section and disqualification from the receipt of 
     financial assistance under this section.
       ``(h) No Entitlement to Contract, Grant, or Assistance.--
     Nothing in this subtitle--
       ``(1) entitles any person to assistance or a contract or 
     grant; or
       ``(2) limits the right of a State to impose additional 
     limitations or conditions on assistance or a contract or 
     grant under this section.

     ``SEC. 381H. GUARANTEE AND COMMITMENT TO GUARANTEE LOANS.

       ``(a) Definition of Eligible Public Entity.--In this 
     section, the term `eligible public entity' means any unit of 
     general local government.
       ``(b) Guarantee and Commitment.--The Secretary, on such 
     terms and conditions as the Secretary may prescribe, may 
     guarantee and make commitments to guarantee notes or other 
     obligations issued by eligible public entities, or by public 
     agencies designated by the eligible public entities, for the 
     purposes of financing rural development activities authorized 
     and funded under section 381G.
       ``(c) Limitation.--The Secretary may not make a guarantee 
     or commitment to guarantee with respect to a note or other 
     obligation if the total amount of outstanding notes or 
     obligations guaranteed under this section (excluding any 
     amount repaid under the contract entered into under 
     subsection (e)(1)(A)) for issuers in the State would exceed 
     an amount equal to 5 times the sum of the total amount of 
     grants made to the State under section 381G.
       ``(d) Payment of Principal, Interest, and Costs.--
     Notwithstanding any other provision of this subtitle, a State 
     to which a grant is made under section 381G may use the grant 
     (including program income derived from the grant) to pay 
     principal and interest due (including such servicing, 
     underwriting, or other costs as may be specified in 
     regulations of the Secretary) on any note or other obligation 
     guaranteed under this section.
       ``(e) Repayment Contract; Security.--
       ``(1) In general.--To ensure the repayment of notes or 
     other obligations and charges incurred under this section and 
     as a condition for receiving the guarantees, the Secretary 
     shall require the issuer to--
       ``(A) enter into a contract, in a form acceptable to the 
     Secretary, for repayment of notes or other obligations 
     guaranteed under this section;
       ``(B) pledge any grant for which the issuer may become 
     eligible under this subtitle; and
       ``(C) furnish, at the discretion of the Secretary, such 
     other security as may be considered appropriate by the 
     Secretary in making the guarantees.
       ``(2) Security.--To assist in ensuring the repayment of 
     notes or other obligations and charges incurred under this 
     section, a State shall pledge any grant for which the State 
     may become eligible under this subtitle as security for notes 
     or other obligations and charges issued under this section by 
     any eligible public entity in the State.
       ``(f) Pledged Grants for Repayments.--Notwithstanding any 
     other provision of this subtitle, the Secretary may apply 
     grants pledged pursuant to paragraphs (1)(B) and (2) of 
     subsection (e) to any repayments due the United States as a 
     result of the guarantees.
       ``(g) Outstanding Obligations.--The total amount of 
     outstanding obligations guaranteed on a cumulative basis by 
     the Secretary pursuant to subsection (b) shall not at any 
     time exceed

[[Page H2784]]

     such amount as may be authorized to be appropriated for such 
     purpose for any fiscal year.
       ``(h) Purchase of Guaranteed Obligations by Federal 
     Financing Bank.--Notes or other obligations guaranteed under 
     this section may not be purchased by the Federal Financing 
     Bank.
       ``(i) Full Faith and Credit.--The full faith and credit of 
     the United States is pledged to the payment of all guarantees 
     made under this section. Any such guarantee made by the 
     Secretary shall be conclusive evidence of the eligibility of 
     the obligations for the guarantee with respect to principal 
     and interest. The validity of the guarantee shall be 
     incontestable in the hands of a holder of the guaranteed 
     obligations.

     ``SEC. 381I. LOCAL INVOLVEMENT.

       ``An application for assistance under this subtitle shall 
     include evidence of significant community support for the 
     project for which the assistance is requested. In the case of 
     assistance for a community facilities or infrastructure 
     project, the evidence shall be in the form of a certification 
     of support for the project from each affected general purpose 
     local government.

     ``SEC. 381J. INTERSTATE COLLABORATION.

       ``The Secretary shall permit the establishment of voluntary 
     pooling arrangements among States, and regional fund-sharing 
     agreements, to carry out projects receiving assistance under 
     this subtitle.

     ``SEC. 381K. ANNUAL REPORT.

       ``(a) In General.--The Secretary, in collaboration with 
     State, local, public, and private entities, State rural 
     development councils, and community-based organizations, 
     shall prepare an annual report that contains evaluations, 
     assessments, and performance outcomes concerning the rural 
     community advancement programs carried out under this 
     subtitle.
       ``(b) Submission.--Not later than March 1 of each year, the 
     Secretary shall--
       ``(1) submit the report required by subsection (a) to 
     Congress and the chief executives of the States participating 
     in the program established under this subtitle; and
       ``(2) make the report available to State and local 
     participants.

     ``SEC. 381L. RURAL DEVELOPMENT INTERAGENCY WORKING GROUP.

       ``(a) In General.--The Secretary shall provide leadership 
     within the Executive branch for, and assume responsibility 
     for, establishing an interagency working group chaired by the 
     Secretary.
       ``(b) Duties.--The working group shall establish policy 
     for, coordinate, make recommendations with respect to, and 
     evaluate the performance of, all Federal rural development 
     efforts.

     ``SEC. 381M. DUTIES OF RURAL ECONOMIC AND COMMUNITY 
                   DEVELOPMENT STATE OFFICES.

       ``In carrying out this subtitle, the Director of a Rural 
     Economic and Community Development State Office shall--
       ``(1) to the maximum extent practicable, ensure that the 
     State strategic plan referred to in section 381D is 
     implemented;
       ``(2) coordinate community development objectives within 
     the State;
       ``(3) establish links between local, State, and field 
     office program administrators of the Department of 
     Agriculture;
       ``(4) ensure that recipient communities comply with 
     applicable Federal and State laws and requirements; and
       ``(5) integrate State development programs with assistance 
     under this subtitle.

     ``SEC. 381N. ELECTRONIC TRANSFER.

       ``The Secretary shall transfer funds in accordance with 
     this subtitle through electronic transfer as soon as 
     practicable after the date of enactment of this subtitle.

     ``SEC. 381O. RURAL VENTURE CAPITAL DEMONSTRATION PROGRAM.

       ``(a) In General.--The Secretary may designate for each 
     fiscal year up to 10 community development venture capital 
     organizations to demonstrate the utility of guarantees to 
     attract increased private investment in rural private 
     business enterprises.
       ``(b) Rural Business Investment Pool.--
       ``(1) Establishment.--To be eligible to participate in the 
     demonstration program, an organization referred to in 
     subsection (a) shall establish a rural business private 
     investment pool (referred to in this subsection as a `pool') 
     for the purpose of making equity investments in rural private 
     business enterprises.
       ``(2) Guarantee.--From amounts in the national reserve 
     account of the Trust Fund, the Secretary shall guarantee the 
     funds in a pool against loss, except that the guarantee shall 
     not exceed an amount equal to 30 percent of the total funds 
     in the pool.
       ``(3) Amount.--The Secretary shall issue guarantees 
     covering not more than $15,000,000 of contingent liabilities 
     for each of fiscal years 1996 through 2002.
       ``(4) Term.--The term of a guarantee provided under this 
     subsection shall not exceed 10 years.
       ``(5) Submission of plan.--To be eligible to participate in 
     the demonstration program, an organization referred to in 
     subsection (a) shall submit a plan that describes--
       ``(A) potential sources and uses of the pool to be 
     established by the organization;
       ``(B) the utility of the guarantee authority in attracting 
     capital for the pool; and
       ``(C) on selection, mechanisms for notifying State, local, 
     and private nonprofit business development organizations and 
     businesses of the existence of the pool.
       ``(6) Competition.--
       ``(A) In general.--The Secretary shall conduct a 
     competition for the designation and establishment of pools.
       ``(B) Priority.--In conducting the competition, the 
     Secretary shall give priority to organizations that--
       ``(i) have a demonstrated record of performance, or have a 
     board and executive director with experience, in venture 
     capital, small business equity investment, or community 
     development finance;
       ``(ii) propose to serve low-income communities;
       ``(iii) propose to maintain an average investment of not 
     more than $500,000 from the pool of the organization;
       ``(iv) invest funds statewide or in a multicounty region; 
     and
       ``(v) propose to target job opportunities resulting from 
     the investments primarily to economically disadvantaged 
     individuals, as determined by the Secretary.
       ``(C) Geographic diversity.--To the extent practicable, the 
     Secretary shall designate organizations in diverse geographic 
     areas.''.

     SEC. 762. SIMPLIFIED, UNIFORM APPLICATION FOR ASSISTANCE FROM 
                   ALL FEDERAL RURAL DEVELOPMENT PROGRAMS.

       Not later than 1 year after the date of enactment of this 
     Act, the Secretary of Agriculture shall develop a 
     streamlined, simplified, and uniform application which shall 
     be used in applying for assistance under all of the 
     following:
       (1) Sections 304(b), 306, 306A, 306C, 306D, 310B, and 375 
     and subtitle E of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1924(b), 1926, 1926a, 1926c, 1926d, and 1932).
       (2) Subtitle G of title XVI and sections 2281, 2333, and 
     2381 of the Food, Agriculture, Conservation, and Trade Act of 
     1990 (7 U.S.C. 5901-5908, 5177a, 950aaa-2, and 3125b).
       (3) Subtitle C of title IX of the Food, Agriculture, 
     Conservation, and Trade Act Amendments of 1991 (Public Law 
     102-237: 7 U.S.C. 5930 note).
       (4) Section 1323(b) of the Food Security Act of 1985 
     (Public Law 99-198; 7 U.S.C. 1932 note).
       (5) Title V and section 603(c) of the Rural Development Act 
     of 1972 (7 U.S.C. 26661-2669 and 2204a(c)).
       (6) Sections 5 and 311 and title IV of the Rural 
     Electrification Act of 1936 (7 U.S.C. 905, 940a, and 941-
     950b).

     SEC. 763. COMMUNITY FACILITIES GRANT PROGRAM.

       Section 306(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1926(a)) (as amended by section 
     741(a)(5)) is amended by adding at the end the following:
       ``(19) Community facilities grant program.--
       ``(A) In general.--The Secretary may make grants, in a 
     total amount not to exceed $10,000,000 for any fiscal year, 
     to associations, units of general local government, nonprofit 
     corporations, and federally recognized Indian tribes to 
     provide the Federal share of the cost of developing specific 
     essential community facilities in rural areas.
       ``(B) Federal share.--
       ``(i) In general.--Except as provided in clauses (ii) and 
     (iii), the Secretary shall, by regulation, establish the 
     amount of the Federal share of the cost of the facility under 
     this paragraph.
       ``(ii) Maximum amount.--The amount of a grant provided 
     under this paragraph for a facility shall not exceed 75 
     percent of the cost of developing the facility.
       ``(iii) Graduated scale.--The Secretary shall provide for a 
     graduated scale for the amount of the Federal share provided 
     under this paragraph, with higher Federal shares for 
     facilities in communities that have lower community 
     population and income levels, as determined by the 
     Secretary.''.
    Subtitle C--Amendments to the Rural Electrification Act of 1936

     SEC. 771. PURPOSES; INVESTIGATIONS AND REPORTS.

       Section 2 of the Rural Electrification Act of 1936 (7 
     U.S.C. 902) is amended--
       (1) by striking ``Sec. 2. (a) The Secretary of Agriculture 
     is'' and inserting the following:

     ``SEC. 2. GENERAL AUTHORITY OF THE SECRETARY OF AGRICULTURE.

       ``(a) Loans.--The Secretary of Agriculture (referred to in 
     this Act as the `Secretary') is'';
       (2) in subsection (a)--
       (A) by striking ``and the furnishing'' the first place it 
     appears and all that follows through ``central station 
     service''; and
       (B) by striking ``systems; to make'' and all that follows 
     and inserting ``systems.''; and
       (3) by striking subsection (b) and inserting the following:
       ``(b) Investigations and Reports.--The Secretary may make, 
     or cause to be made, studies, investigations, and reports 
     regarding matters, including financial, technological, and 
     regulatory matters, affecting the condition and progress of 
     electric, telecommunications, and economic development in 
     rural areas, and publish and disseminate information with 
     respect to the matters.''.

     SEC. 772. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--Section 3 of the Rural Electrification Act 
     of 1936 (7 U.S.C. 903) is amended to read as follows:

     ``SEC. 3. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated such sums as are 
     necessary to carry out this Act.''.
       (b) Conforming Amendments.--
       (1) Section 301(a) of the Rural Electrification Act of 1936 
     (7 U.S.C. 931(a)) is amended--
       (A) by striking ``(a)'' the first place the term appears; 
     and
       (B) in paragraph (3), by striking ``notwithstanding section 
     3(a) of title I,''.
       (2) Section 302(b)(2) of the Rural Electrification Act of 
     1936 (7 U.S.C. 932(b)(2)) is amended by striking ``pursuant 
     to section 3(a) of this Act''.
       (3) The last sentence of section 406(a) of the Rural 
     Electrification Act of 1936 (7 U.S.C. 946(a)) is amended by 
     striking ``pursuant to section 3(a) of this Act''.

     SEC. 773. LOANS FOR ELECTRICAL PLANTS AND TRANSMISSION LINES.

       Section 4 of the Rural Electrification Act of 1936 (7 
     U.S.C. 904) is amended--

[[Page H2785]]

       (1) in the first sentence--
       (A) by striking ``for the furnishing of'' and all that 
     follows through ``central station service and''; and
       (B) by striking ``the provisions of sections 3(d) and 3(e) 
     but without regard to the 25 per centum limitation therein 
     contained,'' and inserting ``section 3,'';
       (2) in the second sentence, by striking ``: Provided 
     further, That all'' and all that follows through ``loan: And 
     provided further, That'' and inserting ``, except that''; and
       (3) in the third sentence, by striking ``and section 5''.

     SEC. 774. LOANS FOR ELECTRICAL AND PLUMBING EQUIPMENT.

       (a) In General.--Section 5 of the Rural Electrification Act 
     of 1936 (7 U.S.C. 905) is repealed.
       (b) Conforming Amendments.--Section 12(a) of the Rural 
     Electrification Act of 1936 (7 U.S.C. 912(a)) is amended--
       (1) by striking ``: Provided, however, That'' and inserting 
     ``, except that,''; and
       (2) by striking ``, and with respect to any loan made under 
     section 5,'' and all that follows through ``section 3''.

     SEC. 775. TESTIMONY ON BUDGET REQUESTS.

       Section 6 of the Rural Electrification Act of 1936 (7 
     U.S.C. 906) is amended by striking the second sentence.

     SEC. 776. TRANSFER OF FUNCTIONS OF ADMINISTRATION CREATED BY 
                   EXECUTIVE ORDER.

       Section 8 of the Rural Electrification Act of 1936 (7 
     U.S.C. 908) is repealed.

     SEC. 777. ANNUAL REPORT.

       Section 10 of the Rural Electrification Act of 1936 (7 
     U.S.C. 910) is repealed.

     SEC. 778. PROHIBITION ON RESTRICTING WATER AND WASTE FACILITY 
                   SERVICES TO ELECTRIC CUSTOMERS.

       The Rural Electrification Act of 1936 is amended by 
     inserting after section 16 (7 U.S.C. 916) the following:

     ``SEC. 17. PROHIBITION ON RESTRICTING WATER AND WASTE 
                   FACILITY SERVICES TO ELECTRIC CUSTOMERS.

       ``(a) Prohibition.--Assistance under any rural development 
     program administered by the Secretary or any agency of the 
     Department of Agriculture shall not be conditioned on any 
     requirement that the recipient of the assistance accept or 
     receive electric service from any particular utility, 
     supplier, or cooperative.
       ``(b) Ensuring Compliance.--The Secretary shall establish, 
     by regulation, adequate safeguards to ensure that assistance 
     under any rural development program is not subject to such a 
     condition. The safeguards shall include periodic 
     certifications and audits, and appropriate measures and 
     sanctions against any person violating, or attempting to 
     violate subsection (a).
       ``(c) Definition of Rural Development Programs.--In this 
     section, the term `rural development program' means the 
     following:
       ``(1) Sections 304(b), 306, 306A, 306C, 306D, 310B, and 375 
     and subtitle E of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1924(b), 1926, 1926a, 1926c, 1926d, and 1932).
       ``(2) Subtitle G of title XVI and sections 2281, 2333, and 
     2381 of the Food, Agriculture, Conservation, and Trade Act of 
     1990 (7 U.S.C. 5901-5908, 5177a, 950aaa-2, and 3125b).
       ``(3) Subtitle C of title IX of the Food, Agriculture, 
     Conservation, and Trade Act Amendments of 1991 (Public Law 
     102-237: 7 U.S.C. 5930 note).
       ``(4) Section 1323(b) of the Food Security Act of 1985 
     (Public Law 99-198; 7 U.S.C. 1932 note).
       ``(5) Title V and section 603(c) of the Rural Development 
     Act of 1972 (7 U.S.C. 26661-2669 and 2204a(c)).
       ``(6) Sections 5 and 311 and title IV of this Act (7 U.S.C. 
     905, 940a, and 941-950b).
       ``(d) Regulations.--Not later than 60 days after the date 
     of enactment of the Federal Agriculture Improvement and 
     Reform Act of 1996, the Secretary shall issue final 
     regulations to ensure compliance with subsection (a).''

     SEC. 779. TELEPHONE LOAN TERMS AND CONDITIONS.

       Section 309 of the Rural Electrification Act of 1936 (7 
     U.S.C. 939) is amended--
       (1) in subsection (a), by striking ``(a) In General.--''; 
     and
       (2) by striking subsection (b).

     SEC. 780. PRIVATIZATION PROGRAM.

       Section 311 of the Rural Electrification Act of 1936 (7 
     U.S.C. 940a) is repealed.

     SEC. 781. RURAL BUSINESS INCUBATOR FUND.

       (a) In General.--Section 502 of the Rural Electrification 
     Act of 1936 (7 U.S.C. 950aa-1) is repealed.
       (b) Conforming Amendments.--Section 501 of the Rural 
     Electrification Act of 1936 (7 U.S.C. 950aa) is amended--
       (1) in paragraph (5), by inserting ``and'' at the end;
       (2) in paragraph (6), by striking ``; and'' at the end and 
     inserting a period; and
       (3) by striking paragraph (7).
         Subtitle D--Miscellaneous Rural Development Provisions

     SEC. 791. INTEREST RATE FORMULA.

       (a) Bankhead-Jones Farm Tenant Act.--Section 32(e) of the 
     Bankhead-Jones Farm Tenant Act (7 U.S.C. 1011) is amended by 
     striking the fifth sentence and inserting the following: ``A 
     loan under this subsection shall be made under a contract 
     that provides, under such terms and conditions as the 
     Secretary considers appropriate, for the repayment of the 
     loan in not more than 30 years, with interest at a rate not 
     to exceed the current market yield for outstanding municipal 
     obligations with remaining periods to maturity comparable to 
     the average maturity for the loan, adjusted to the nearest 
     \1/8\ of 1 percent.''.
       (b) Watershed Protection and Flood Prevention Act.--Section 
     8 of the Watershed Protection and Flood Prevention Act (16 
     U.S.C. 1006a) is amended by striking the second sentence and 
     inserting the following: ``A loan or advance under this 
     section shall be made under a contract or agreement that 
     provides, under such terms and conditions as the Secretary 
     considers appropriate, for the repayment of the loan or 
     advance in not more than 50 years from the date when the 
     principal benefits of the works of improvement first become 
     available, with interest at a rate not to exceed the current 
     market yield for outstanding municipal obligations with 
     remaining periods to maturity comparable to the average 
     maturity for the loan, adjusted to the nearest \1/8\ of 1 
     percent.''.

     SEC. 792. GRANTS FOR FINANCIALLY STRESSED FARMERS, DISLOCATED 
                   FARMERS, AND RURAL FAMILIES.

       (a) In General.--Section 502 of the Rural Development Act 
     of 1972 (7 U.S.C. 2662) is amended by striking subsection 
     (f).
       (b) Conforming Amendments.--
       (1) Section 2389 of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (Public Law 101-624; 7 U.S.C. 2662 
     note) is amended by striking subsection (d).
       (2) Section 503(c) of the Rural Development Act of 1972 (7 
     U.S.C. 2663(c)) is amended--
       (A) in paragraph (1)--
       (i) by striking ``(1)'';
       (ii) by striking ``section 502(e)'' and all that follows 
     through ``shall be distributed'' and inserting ``subsections 
     (e), (h), and (i) of section 502 shall be distributed''; and
       (iii) by striking ``objectives of'' and all that follows 
     through ``title'' and inserting ``objectives of subsections 
     (e), (h), and (i) of section 502''; and
       (B) by striking paragraph (2).

     SEC. 793. FUND FOR RURAL AMERICA.

       (a) In General.--There is established in the Treasury of 
     the United States an account to be known as the Fund for 
     Rural America (referred to in this section as the 
     ``Account'') to provide funds for activities described in 
     subsection (c).
       (b) Funding.--
       (1) In general.--On January 1, 1997, October 1, 1998, and 
     October 1, 1999, out of any funds in the Treasury not 
     otherwise appropriated, the Secretary of the Treasury shall 
     transfer $100,000,000 to the Account.
       (2) Entitlement.-- The Secretary of Agriculture (referred 
     to in this section as the ``Secretary'')--
       (A) shall be entitled to receive the funds transferred to 
     the Account under paragraph (1);
       (B) shall accept the funds; and
       (C) shall use the funds to carry out this section.
       (3) Purposes.--Subject to subsection (d), of the amounts 
     transferred to the Account for a fiscal year, the Secretary 
     shall make available--
       (A) for activities described in subsection (c)(1), not less 
     than \1/3\ and not more than \2/3\ of the funds in the 
     Account; and
       (B) for activities described in subsection (c)(2), all 
     funds in the Account not made available by the Secretary for 
     activities described in subsection (c)(1).
       (c) Activities.--
       (1) Rural development.--
       (A) In general.--The Secretary may use the funds in the 
     Account for a rural development activity--
       (i) authorized under the Housing Act of 1949 for--

       (I) direct loans to low-income borrowers under section 502 
     (42 U.S.C. 1472);
       (II) loans for financial assistance for housing for 
     domestic farm laborers under section 514 (42 U.S.C. 1484);
       (III) financial assistance for housing for domestic farm 
     laborers under section 516 (42 U.S.C. 1486);
       (IV) payments for elderly who are not now receiving rental 
     assistance under section 521 (42 U.S.C. 1490a);
       (V) grants and contracts for mutual and self-help housing 
     under section 523(b)(1)(A) (42 U.S.C. 1490c(b)(1)(A)); or
       (VI) grants for rural housing preservation under section 
     533 (42 U.S.C. 1490m); or

       (ii) conducted under any rural development program, 
     including a program authorized under--

       (I) the Consolidated Farm and Rural Development Act (7 
     U.S.C. 1921 et seq.);
       (II) subtitle G of title XVI and title XXIII of the Food, 
     Agriculture, Conservation, and Trade Act of 1990;
       (III) title V of the Rural Development Act of 1971 (7 
     U.S.C. 2661 et seq.); or

       (IV) section 1323(b) of the Food Security Act of 1985 
     (Public Law 99-198; 7 U.S.C. 1932 note).

       (B) Limitation on programs funded.--The Secretary may not 
     expend funds made available to carry out activities described 
     in subparagraph (A) for any activity that did not receive 
     appropriations for fiscal year 1995. Funds expended under 
     this section for any program purpose shall be spent in 
     accordance with and subject to the applicable program 
     limitations, restrictions, and priorities found in the 
     underlying program authority and this Act.
       (C) Limitation on housing assistance.--Not more than 20 
     percent of the funds made available to carry out activities 
     described in subparagraph (A) shall be made available to 
     carry out activities described in subparagraph (A)(i).
       (D) Disclosure of allocation.--For any fiscal year, the 
     Secretary shall not disclose the allocation of funds under 
     this section for any activity described in subparagraph (A) 
     until the date that is 1 day after the date of enactment of 
     legislation authorizing appropriations for the Department of 
     Agriculture for any period in the fiscal year.
       (2) Research.--
       (A) In general.--The Secretary may use the funds in the 
     Account for research, extension, and education grants to--

[[Page H2786]]

       (i) increase international competitiveness, efficiency, and 
     farm profitability;
       (ii) reduce economic and health risks;
       (iii) conserve and enhance natural resources;
       (iv) develop new crops, new crop uses, and new agricultural 
     applications of biotechnology;
       (v) enhance animal agricultural resources;
       (vi) preserve plant and animal germplasm;
       (vii) increase economic opportunities in farming and rural 
     communities; and
       (viii) expand locally-owned value-added processing.
       (B) Eligible grantee.--The Secretary may make a grant under 
     this paragraph to--
       (i) a Federal research agency;
       (ii) a national laboratory;
       (iii) a college or university or a research foundation 
     maintained by a college or university; or
       (iv) a private research organization with an established 
     and demonstrated capacity to perform research or technology 
     transfer.
       (C) Use of grant.--
       (i) In general.--A grant made under this paragraph may be 
     used by a grantee for 1 or more of the following uses:

       (I) Outcome-oriented research at the discovery end of the 
     spectrum to provide breakthrough results.
       (II) Exploratory and advanced development and technology 
     with well-identified outcomes.
       (III) A national, regional, or multi-State program oriented 
     primarily toward extension programs and education programs 
     demonstrating and supporting the competitiveness of United 
     States agriculture.

       (ii) Smaller institutions.--Of the amounts made available 
     for activities described in this paragraph, not less than 15 
     percent shall be awarded to colleges, universities, or 
     research foundations eligible for a grant under subparagraph 
     (B)(iii) that rank in the lowest \1/3\ of such colleges, 
     universities, and foundations on the basis of Federal 
     research funds received under a provision of law other than 
     this section.
       (D) Administration.--
       (i) Priority.--In administering this paragraph, the 
     Secretary shall--

       (I) establish criteria for allocating grants based on the 
     priorities in subparagraph (A) and in consultation with the 
     National Agricultural Research, Extension, Education, and 
     Economics Advisory Board established under section 1408 of 
     the National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 (7 U.S.C. 3123);
       (II) seek and accept proposals for grants;
       (III) determine the relevance and merit of proposals 
     through a system of peer review and review by the National 
     Agricultural Research, Extension, Education, and Economics 
     Advisory Board; and
       (IV) award grants on the basis of merit, quality, and 
     relevance to advancing the purposes of federally supported 
     agricultural research, extension, and education provided in 
     section 1402 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3101).

       (ii) Competitive basis.--A grant under this paragraph shall 
     be awarded on a competitive basis.
       (iii) Terms.--A grant under this paragraph shall have a 
     term that does not exceed 5 years.
       (iv) Matching funds.--As a condition of making a grant 
     under this paragraph, the Secretary shall require the funding 
     of the grant with equal matching funds from a non-Federal 
     source if the grant is--

       (I) for applied research that is commodity-specific; and
       (II) not of national scope.

       (v) Delegation.--The Secretary shall administer this 
     section through the Cooperative State Research, Education, 
     and Extension Service of the Department of Agriculture.
       (vi) Availability of funds.--Funds shall be available for 
     obligation under this paragraph for a 2-year period.
       (vii) Administrative costs.--The Secretary may use not more 
     than 4 percent of the funds made available for activities 
     described in this paragraph for administrative costs incurred 
     by the Secretary in carrying out this paragraph.
       (viii) Buildings.--Funds made available for activities 
     described in this paragraph shall not be used for the 
     construction of a new building or the acquisition, expansion, 
     remodeling, or alteration of an existing building (including 
     site grading and improvement and architect fees).
       (d) Limitations.--Amounts in the Account may not be used 
     for an activity described in subsection (c) for a fiscal year 
     if the program funding level for the fiscal year for the 
     activity is less than 90 percent of the amount appropriated 
     for the activity for fiscal year 1996, adjusted for 
     inflation.

     SEC. 794. UNDER SECRETARY OF AGRICULTURE FOR RURAL ECONOMIC 
                   AND COMMUNITY DEVELOPMENT RENAMED THE UNDER 
                   SECRETARY OF AGRICULTURE FOR RURAL DEVELOPMENT.

       (a) In General.--Section 231 of the Department of 
     Agriculture Reorganization Act of 1994 (7 U.S.C. 6941) is 
     amended--
       (1) in the section heading, by striking ``ECONOMIC AND 
     COMMUNITY''; and
       (2) by striking ``Economic and Community'' each place such 
     term appears in subsections (a), (b), and (c).
       (b) Conforming Amendment.--Section 5314 of title 5, United 
     States Code, is amended by striking ``Economic and 
     Community''.
             TITLE VIII--RESEARCH, EXTENSION, AND EDUCATION
  Subtitle A--Modification and Extension of Activities Under 1977 Act

     SEC. 801. PURPOSES OF AGRICULTURAL RESEARCH, EXTENSION, AND 
                   EDUCATION.

       Section 1402 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3101) is 
     amended to read as follows:

     ``SEC. 1402. PURPOSES OF AGRICULTURAL RESEARCH, EXTENSION, 
                   AND EDUCATION.

       ``The purposes of federally supported agricultural 
     research, extension, and education are to--
       ``(1) enhance the competitiveness of the United States 
     agriculture and food industry in an increasingly competitive 
     world environment;
       ``(2) increase the long-term productivity of the United 
     States agriculture and food industry while maintaining and 
     enhancing the natural resource base on which rural America 
     and the United States agricultural economy depend;
       ``(3) develop new uses and new products for agricultural 
     commodities, such as alternative fuels, and develop new 
     crops;
       ``(4) support agricultural research and extension to 
     promote economic opportunity in rural communities and to meet 
     the increasing demand for information and technology transfer 
     throughout the United States agriculture industry;
       ``(5) improve risk management in the United States 
     agriculture industry;
       ``(6) improve the safe production and processing of, and 
     adding of value to, United States food and fiber resources 
     using methods that maintain the balance between yield and 
     environmental soundness;
       ``(7) support higher education in agriculture to give the 
     next generation of Americans the knowledge, technology, and 
     applications necessary to enhance the competitiveness of 
     United States agriculture; and
       ``(8) maintain an adequate, nutritious, and safe supply of 
     food to meet human nutritional needs and requirements.''.

     SEC. 802. NATIONAL AGRICULTURAL RESEARCH, EXTENSION, 
                   EDUCATION, AND ECONOMICS ADVISORY BOARD.

       (a) In General.--Section 1408 of the National Agricultural 
     Research, Extension, and Teaching Policy Act of 1977 (7 
     U.S.C. 3123) is amended to read as follows:

     ``SEC. 1408. NATIONAL AGRICULTURAL RESEARCH, EXTENSION, 
                   EDUCATION, AND ECONOMICS ADVISORY BOARD.

       ``(a) Establishment.--The Secretary shall establish within 
     the Department of Agriculture a board to be known as the 
     `National Agricultural Research, Extension, Education, and 
     Economics Advisory Board'.
       ``(b) Membership.--
       ``(1) In general.--The Advisory Board shall consist of 30 
     members, appointed by the Secretary.
       ``(2) Selection of members.--The Secretary shall appoint 
     members of the Advisory Board from nominations submitted by 
     organizations, associations, societies, councils, 
     federations, groups, and companies fitting the criteria 
     specified in paragraph (3).
       ``(3) Membership categories.--The Advisory Board shall 
     consist of members from each of the following categories:
       ``(A) 1 member representing a national farm organization.
       ``(B) 1 member representing farm cooperatives.
       ``(C) 1 member actively engaged in the production of a food 
     animal commodity.
       ``(D) 1 member actively engaged in the production of a 
     plant commodity.
       ``(E) 1 member representing a national animal commodity 
     organization.
       ``(F) 1 member representing a national crop commodity 
     organization.
       ``(G) 1 member representing a national aquaculture 
     association.
       ``(H) 1 member representing a national food animal science 
     society.
       ``(I) 1 member representing a national crop, soil, 
     agronomy, horticulture, or weed science society.
       ``(J) 1 member representing a national food science 
     organization.
       ``(K) 1 member representing a national human health 
     association.
       ``(L) 1 member representing a national nutritional science 
     society.
       ``(M) 1 member representing the land-grant colleges and 
     universities eligible to receive funds under the Act of July 
     2, 1862 (7 U.S.C. 301 et seq.).
       ``(N) 1 member representing the land-grant colleges and 
     universities eligible to receive funds under the Act of 
     August 30, 1890 (7 U.S.C. 321 et seq.), including Tuskegee 
     University.
       ``(O) 1 member representing the 1994 Institutions (as 
     defined in section 532 of the Equity in Educational Land-
     Grant Status Act of 1994 (Public Law 103-382; 7 U.S.C. 301 
     note)).
       ``(P) 1 member representing Hispanic-serving institutions.
       ``(Q) 1 member representing the American Colleges of 
     Veterinary Medicine.
       ``(R) 1 member representing that portion of the scientific 
     community not closely associated with agriculture.
       ``(S) 1 member engaged in the transportation of food and 
     agricultural products to domestic and foreign markets.
       ``(T) 1 member representing food retailing and marketing 
     interests.
       ``(U) 1 member representing food and fiber processors.
       ``(V) 1 member actively engaged in rural economic 
     development.
       ``(W) 1 member representing a national consumer interest 
     group.
       ``(X) 1 member representing a national forestry group.
       ``(Y) 1 member representing a national conservation or 
     natural resource group.
       ``(Z) 1 member representing private sector organizations 
     involved in international development.
       ``(AA) 1 member representing an agency within the 
     Department of Agriculture that lacks research capabilities.
       ``(BB) 1 member representing a research agency of the 
     Federal Government (other than the Department of 
     Agriculture).

[[Page H2787]]

       ``(CC) 1 member representing a national social science 
     association.
       ``(DD) 1 member representing national organizations 
     directly concerned with agricultural research, education, and 
     extension.
       ``(4) Ex officio members.--The Secretary, the Under 
     Secretary of Agriculture for Research, Education, and 
     Economics, the Administrator of the Agricultural Research 
     Service, the Administrator of the Cooperative State Research, 
     Education, and Extension Service, the Administrator of the 
     Economic Research Service, and the Administrator of the 
     National Agricultural Statistics Service shall serve as ex 
     officio members of the Advisory Board.
       ``(5) Officers.--At the first meeting of the Advisory Board 
     each year, the members shall elect from among the members of 
     the Advisory Board a chairperson, vice chairperson, and 7 
     additional members to serve on the executive committee 
     established under paragraph (6).
       ``(6) Executive committee.--The Advisory Board shall 
     establish an executive committee charged with the 
     responsibility of working with the Secretary and officers and 
     employees of the Department of Agriculture to summarize and 
     disseminate the recommendations of the Advisory Board.
       ``(c) Duties.--The Advisory Board shall--
       ``(1) review and provide consultation to the Secretary and 
     land-grant colleges and universities on long-term and short-
     term national policies and priorities, as set forth in 
     section 1402, relating to agricultural research, extension, 
     education, and economics;
       ``(2) evaluate the results and effectiveness of 
     agricultural research, extension, education, and economics 
     with respect to the policies and priorities;
       ``(3) review and make recommendations to the Under 
     Secretary of Agriculture for Research, Education, and 
     Economics on the research, extension, education, and 
     economics portion of the draft strategic plan required under 
     section 306 of title 5, United States Code; and
       ``(4) review the mechanisms of the Department of 
     Agriculture for technology assessment (which should be 
     conducted by qualified professionals) for the purposes of--
       ``(A) performance measurement and evaluation of the 
     implementation by the Secretary of the strategic plan 
     required under section 306 of title 5, United States Code;
       ``(B) implementation of the national research policies and 
     priorities set forth in section 1402; and
       ``(C) the development of mechanisms for the assessment of 
     emerging public and private agricultural research and 
     technology transfer initiatives.
       ``(d) Consultation.--In carrying out this section, the 
     Advisory Board shall solicit opinions and recommendations 
     from persons who will benefit from and use federally funded 
     agricultural research, extension, education, and economics.
       ``(e) Appointment.--A member of the Advisory Board shall be 
     appointed by the Secretary for a term of up to 3 years. The 
     members of the Advisory Board shall be appointed to serve 
     staggered terms.
       ``(f) Federal Advisory Committee Act.--The Advisory Board 
     shall be deemed to have filed a charter for the purpose of 
     section 9(c) of the Federal Advisory Committee Act (5 U.S.C. 
     App.).
       ``(g) Termination.--The Advisory Board shall remain in 
     existence until September 30, 2002.''.
       (b) Conforming Amendments.--
       (1) Section 1404(1) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103(1)) 
     is amended by striking ``National Agricultural Research and 
     Extension Users Advisory Board'' and inserting ``National 
     Agricultural Research, Extension, Education, and Economics 
     Advisory Board''.
       (2) Section 1410(2) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3125(2)) 
     is amended by striking ``the recommendations of the Advisory 
     Board developed under section 1408(g),'' and inserting ``any 
     recommendations of the Advisory Board''.
       (3) The last sentence of section 4(a) of the Renewable 
     Resources Extension Act of 1978 (16 U.S.C. 1673(a)) is 
     amended by striking ``National Agricultural Research and 
     Extension Users Advisory Board'' and inserting ``National 
     Agricultural Research, Extension, Education, and Economics 
     Advisory Board''.

     SEC. 803. FEDERAL ADVISORY COMMITTEE ACT EXEMPTION FOR 
                   FEDERAL-STATE COOPERATIVE PROGRAMS.

       Section 1409A of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3124a) 
     is amended by adding at the end the following:
       ``(e) Applicability of Federal Advisory Committee Act.--
       ``(1) Public meetings.--All meetings of any entity 
     described in paragraph (3) shall be publicly announced in 
     advance and shall be open to the public. Detailed minutes of 
     meetings and other appropriate records of the activities of 
     such an entity shall be kept and made available to the public 
     on request.
       ``(2) Exemption.--The Federal Advisory Committee Act (5 
     U.S.C. App.) and title XVIII of this Act shall not apply to 
     any entity described in paragraph (3).
       ``(3) Entities described.--This subsection shall apply to 
     any committee, board, commission, panel, or task force, or 
     similar entity that--
       ``(A) is created for the purpose of cooperative efforts in 
     agricultural research, extension, or teaching; and
       ``(B) consists entirely of--
       ``(i) full-time Federal employees; and
       ``(ii) one or more individuals who are employed by, or are 
     officials of--

       ``(I) a State cooperative institution or State cooperative 
     agency; or
       ``(II) a public college or university or other 
     postsecondary institution.''.

     SEC. 804. COORDINATION AND PLANNING OF AGRICULTURAL RESEARCH, 
                   EXTENSION, AND EDUCATION.

       The National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 is amended by inserting after section 1413 
     (7 U.S.C. 3128) the following:

     ``SEC. 1413A. ACCOUNTABILITY.

       ``(a) Review of Information Technology Systems.--The 
     Secretary shall conduct a comprehensive review of state-of-
     the-art information technology systems that are available for 
     use in developing the system required by subsection (b).
       ``(b) Monitoring and Evaluation System.--The Secretary 
     shall develop and carry out a system to monitor and evaluate 
     agricultural research and extension activities conducted or 
     supported by the Department of Agriculture that will enable 
     the Secretary to measure the impact and effectiveness of 
     research, extension, and education programs according to 
     priorities, goals, and mandates established by law. In 
     developing the system, the Secretary shall incorporate 
     information transfer technologies to optimize public access 
     to research information.
       ``(c) Consistency With Other Requirements.--The Secretary 
     shall develop and implement the system in a manner consistent 
     with the Government Performance and Results Act of 1993 
     (Public Law 103-62; 107 Stat. 285) and amendments made by the 
     Act.
       ``(d) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this section.

     ``SEC. 1413B. FEDERAL ADVISORY COMMITTEE ACT EXEMPTION FOR 
                   COMPETITIVE RESEARCH, EXTENSION, AND EDUCATION 
                   PROGRAMS.

       ``The Federal Advisory Committee Act (5 U.S.C. App.) and 
     title XVIII of this Act shall not apply to any committee, 
     board, commission, panel, or task force, or similar entity, 
     created solely for the purpose of reviewing applications or 
     proposals requesting funding under any competitive research, 
     extension, or education program carried out by the 
     Secretary.''.

     SEC. 805. GRANTS AND FELLOWSHIPS FOR FOOD AND AGRICULTURAL 
                   SCIENCES EDUCATION.

       (a) Purpose of Grants.--Section 1417(b) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3152(b)) is amended by striking paragraph (4) 
     and inserting the following:
       ``(4) to design and implement food and agricultural 
     programs to build teaching and research capacity at colleges 
     and universities having significant minority enrollments;''.
       (b) Research Foundations.--Section 1417(c) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3152(c)) is amended by adding at the end the 
     following:
       ``(3) Research foundations.--An eligible college or 
     university under subsection (b) includes a research 
     foundation maintained by the college or university.''.
       (c) Extension of Program.--Section 1417(i) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3152(i)) is amended by striking ``1995'' and 
     inserting ``1997''.
       (d) Secondary Education and 2-Year Postsecondary Education 
     Teaching Programs.--Section 1417 of the National Agricultural 
     Research, Extension, and Teaching Policy Act of 1977 (7 
     U.S.C. 3152) is amended--
       (1) by redesignating subsections (h) and (i) as subsections 
     (i) and (j), respectively; and
       (2) by inserting after subsection (g) the following:
       ``(h) Secondary Education and 2-Year Postsecondary 
     Education Teaching Programs.--
       ``(1) Definitions.--In this subsection:
       ``(A) Institution of higher education.--The term 
     `institution of higher education' has the meaning given the 
     term in section 1201(a) of the Higher Education Act of 1965 
     (20 U.S.C. 1141(a)).
       ``(B) Secondary school.--The term `secondary school' has 
     the meaning given the term in section 14101(25) of the 
     Elementary and Secondary Education Act of 1965 (20 U.S.C. 
     8801(25)).
       ``(2) Agriscience and agribusiness education.--The 
     Secretary shall--
       ``(A) promote and strengthen secondary education and 2-year 
     postsecondary education in agriscience and agribusiness in 
     order to help ensure the existence in the United States of a 
     qualified workforce to serve the food and agricultural 
     sciences system; and
       ``(B) promote complementary and synergistic linkages among 
     secondary, 2-year postsecondary, and higher education 
     programs in the food and agricultural sciences in order to 
     promote excellence in education and encourage more young 
     Americans to pursue and complete a baccalaureate or higher 
     degree in the food and agricultural sciences.
       ``(3) Grants.--The Secretary may make competitive or 
     noncompetitive grants, for grant periods not to exceed 5 
     years, to public secondary schools, and institutions of 
     higher education that award an associate's degree, that the 
     Secretary determines have made a commitment to teaching 
     agriscience and agribusiness--
       ``(A) to enhance curricula in agricultural education;
       ``(B) to increase faculty teaching competencies;
       ``(C) to interest young people in pursuing higher education 
     in order to prepare for scientific and professional careers 
     in the food and agricultural sciences;
       ``(D) to promote the incorporation of agriscience and 
     agribusiness subject matter into other instructional 
     programs, particularly classes in science, business, and 
     consumer education;

[[Page H2788]]

       ``(E) to facilitate joint initiatives by the grant 
     recipient with other secondary schools, institutions of 
     higher education that award an associate's degree, and 
     institutions of higher education that award a bachelor's 
     degree to maximize the development and use of resources, such 
     as faculty, facilities, and equipment, to improve agriscience 
     and agribusiness education; and
       ``(F) to support other initiatives designed to meet local, 
     State, regional, or national needs related to promoting 
     excellence in agriscience and agribusiness education.''.

     SEC. 806. GRANTS FOR RESEARCH ON THE PRODUCTION AND MARKETING 
                   OF ALCOHOLS AND INDUSTRIAL HYDROCARBONS FROM 
                   AGRICULTURAL COMMODITIES AND FOREST PRODUCTS.

       Section 1419(d) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3154(d)) 
     is amended by striking ``1995'' and inserting ``1997''.

     SEC. 807. POLICY RESEARCH CENTERS.

       The National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 is amended by inserting after section 1419 
     (7 U.S.C. 3154) the following:

     ``SEC. 1419A. POLICY RESEARCH CENTERS.

       ``(a) In General.--Consistent with this section, the 
     Secretary may make grants, competitive grants, and special 
     research grants to, and enter into cooperative agreements and 
     other contracting instruments with, policy research centers 
     described in subsection (b) to conduct research and education 
     programs that are objective, operationally independent, and 
     external to the Federal Government and that concern the 
     effect of public policies on--
       ``(1) the farm and agricultural sectors;
       ``(2) the environment;
       ``(3) rural families, households, and economies; and
       ``(4) consumers, food, and nutrition.
       ``(b) Eligible Recipients.--State agricultural experiment 
     stations, colleges and universities, other research 
     institutions and organizations, private organizations, 
     corporations, and individuals shall be eligible to apply for 
     funding under subsection (a).
       ``(c) Activities.--Under this section, funding may be 
     provided for disciplinary and interdisciplinary research and 
     education concerning policy research activities consistent 
     with this section, including activities that--
       ``(1) quantify the implications of public policies and 
     regulations;
       ``(2) develop theoretical and research methods;
       ``(3) collect and analyze data for policymakers, analysts, 
     and individuals; and
       ``(4) develop programs to train analysts.
       ``(d) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this section for fiscal years 1996 and 1997.''.

     SEC. 808. HUMAN NUTRITION INTERVENTION AND HEALTH PROMOTION 
                   RESEARCH PROGRAM.

       The National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 is amended by striking section 1424 (7 
     U.S.C. 3174) and inserting the following:

     ``SEC. 1424. HUMAN NUTRITION INTERVENTION AND HEALTH 
                   PROMOTION RESEARCH PROGRAM.

       ``(a) Authority of Secretary.--The Secretary may establish, 
     and award grants for projects for, a multi-year research 
     initiative on human nutrition intervention and health 
     promotion.
       ``(b) Emphasis of Initiative.--In administering human 
     nutrition research projects under this section, the Secretary 
     shall give specific emphasis to--
       ``(1) coordinated longitudinal research assessments of 
     nutritional status; and
       ``(2) the implementation of unified, innovative 
     intervention strategies,
     to identify and solve problems of nutritional inadequacy and 
     contribute to the maintenance of health, well-being, 
     performance, and productivity of individuals, thereby 
     reducing the need of the individuals to use the health care 
     system and social programs of the United States.
       ``(c) Administration of Funds.--The Administrator of the 
     Agricultural Research Service shall administer funds made 
     available to carry out this section to ensure a coordinated 
     approach to health and nutrition research efforts.
       ``(d) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this section for fiscal years 1996 and 1997.

     ``SEC. 1424A. PILOT RESEARCH PROGRAM TO COMBINE MEDICAL AND 
                   AGRICULTURAL RESEARCH.

       ``(a) Findings.--Congress finds the following:
       ``(1) Although medical researchers in recent years have 
     demonstrated that there are several naturally occurring 
     compounds in many vegetables and fruits that can aid in the 
     prevention of certain forms of cancer, coronary heart 
     disease, stroke, and atherosclerosis, there has been almost 
     no research conducted to enhance these compounds in food 
     plants by modern breeding and molecular genetic methods.
       ``(2) By linking the appropriate medical and agricultural 
     research scientists in a highly-focused, targeted research 
     program, it should be possible to develop new varieties of 
     vegetables and fruits that would provide greater prevention 
     of diet-related diseases that are a major cause of death in 
     the United States.
       ``(b) Pilot Research Program.--The Secretary shall conduct, 
     through the Cooperative State Research, Education, and 
     Extension Service, a pilot research program to link major 
     cancer and heart and other circulatory disease research 
     efforts with agricultural research efforts to identify 
     compounds in vegetables and fruits that prevent these 
     diseases. Using information derived from such combined 
     research efforts, the Secretary shall assist in the 
     development of new varieties of vegetables and fruits having 
     enhanced therapeutic properties for disease prevention.
       ``(c) Agreements.--The Secretary shall carry out the pilot 
     program through agreements entered into with land-grant 
     colleges or universities, other universities, State 
     agricultural experiment stations, the State cooperative 
     extension services, nonprofit organizations with demonstrable 
     expertise, or Federal or State governmental entities. The 
     Secretary shall enter into the agreements on a competitive 
     basis.
       ``(d) Authorization of Appropriations.--There are 
     authorized to be appropriated $10,000,000 for fiscal year 
     1997 to carry out the pilot program.''.

     SEC. 809. FOOD AND NUTRITION EDUCATION PROGRAM.

       Section 1425(c)(3) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
     3175(c)(3)) is amended by striking ``$63,000,000'' and all 
     that follows through ``fiscal year 1995'' and inserting ``, 
     $83,000,000 for each of fiscal years 1996 and 1997''.

     SEC. 810. PURPOSES AND FINDINGS RELATING TO ANIMAL HEALTH AND 
                   DISEASE RESEARCH.

       Section 1429 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3191) is 
     amended to read as follows:

     ``SEC. 1429. PURPOSES AND FINDINGS RELATING TO ANIMAL HEALTH 
                   AND DISEASE RESEARCH.

       ``(a) Purposes.--The purposes of this subtitle are to--
       ``(1) promote the general welfare through the improved 
     health and productivity of domestic livestock, poultry, 
     aquatic animals, and other income-producing animals that are 
     essential to the food supply of the United States and the 
     welfare of producers and consumers of animal products;
       ``(2) improve the health of horses;
       ``(3) facilitate the effective treatment of, and, to the 
     extent possible, prevent animal and poultry diseases in both 
     domesticated and wild animals that, if not controlled, would 
     be disastrous to the United States livestock and poultry 
     industries and endanger the food supply of the United States;
       ``(4) improve methods for the control of organisms and 
     residues in food products of animal origin that could 
     endanger the human food supply;
       ``(5) improve the housing and management of animals to 
     improve the well-being of livestock production species;
       ``(6) minimize livestock and poultry losses due to 
     transportation and handling;
       ``(7) protect human health through control of animal 
     diseases transmissible to humans;
       ``(8) improve methods of controlling the births of 
     predators and other animals; and
       ``(9) otherwise promote the general welfare through 
     expanded programs of research and extension to improve animal 
     health.
       ``(b) Findings.--Congress finds that--
       ``(1) the total animal health and disease research and 
     extension efforts of State colleges and universities and of 
     the Federal Government would be more effective if there were 
     close coordination between the efforts; and
       ``(2) colleges and universities having accredited schools 
     or colleges of veterinary medicine and State agricultural 
     experiment stations that conduct animal health and disease 
     research are especially vital in training research workers in 
     animal health and related disciplines.''.

     SEC. 811. ANIMAL HEALTH AND DISEASE CONTINUING RESEARCH.

       Section 1433 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3195) is 
     amended--
       (1) in the first sentence of subsection (a), by striking 
     ``1995'' and inserting ``1997'';
       (2) in subsection (b)(2)--
       (A) by striking ``domestic livestock and poultry'' each 
     place it appears and inserting ``domestic livestock, poultry, 
     and commercial aquaculture species''; and
       (B) in the second sentence, by striking ``horses, and 
     poultry'' and inserting ``horses, poultry, and commercial 
     aquaculture species'';
       (3) in subsection (d), by striking ``domestic livestock and 
     poultry'' and inserting ``domestic livestock, poultry, and 
     commercial aquaculture species''; and
       (4) in subsection (f), by striking ``domestic livestock and 
     poultry'' and inserting ``domestic livestock, poultry, and 
     commercial aquaculture species''.

     SEC. 812. ANIMAL HEALTH AND DISEASE NATIONAL OR REGIONAL 
                   RESEARCH.

       Section 1434 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3196) is 
     amended--
       (1) in subsection (a)--
       (A) by inserting ``or national or regional problems 
     relating to pre-harvest, on-farm food safety, or animal well-
     being,'' after ``problems,''; and
       (B) by striking ``1995'' and inserting ``1997'';
       (2) in subsection (b), by striking ``eligible 
     institutions'' and inserting ``State agricultural experiment 
     stations, colleges and universities, other research 
     institutions and organizations, Federal agencies, private 
     organizations or corporations, and individuals'';
       (3) in subsection (c)--
       (A) in the first sentence, by inserting ``, food safety, 
     and animal well-being'' after ``animal health and disease''; 
     and
       (B) in the fourth sentence--
       (i) by redesignating paragraphs (2) and (3) as paragraphs 
     (4) and (5), respectively; and
       (ii) by inserting after paragraph (1) the following:
       ``(2) any food safety problem that has a significant pre-
     harvest (on-farm) component and is recognized as posing a 
     significant health hazard to the consuming public;
       ``(3) issues of animal well-being related to production 
     methods that will improve the housing

[[Page H2789]]

     and management of animals to improve the well-being of 
     livestock production species;'';
       (4) in the first sentence of subsection (d), by striking 
     ``to eligible institutions''; and
       (5) by adding at the end the following:
       ``(f) Applicability of Federal Advisory Committee Act.--The 
     Federal Advisory Committee Act (5 U.S.C. App.) and title 
     XVIII of this Act shall not apply to a panel or board created 
     solely for the purpose of reviewing applications or proposals 
     submitted under this subtitle.''.

     SEC. 813. GRANT PROGRAM TO UPGRADE AGRICULTURAL AND FOOD 
                   SCIENCES FACILITIES AT 1890 LAND-GRANT 
                   COLLEGES.

       Section 1447(b) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
     3222b(b)) is amended by striking ``$8,000,000 for each of the 
     fiscal years 1991 through 1995'' and inserting ``, 
     $15,000,000 for each of fiscal years 1996 and 1997''.

     SEC. 814. NATIONAL RESEARCH AND TRAINING CENTENNIAL CENTERS.

       Section 1448 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3222c) 
     is amended--
       (1) in subsection (a)(1), by inserting ``, or fiscal years 
     1996 and 1997,'' after ``1995''; and
       (2) in subsection (f), by striking ``1995'' and inserting 
     ``1997''.

     SEC. 815. PROGRAMS FOR HISPANIC-SERVING INSTITUTIONS.

       (a) In General.--The National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 is amended by 
     inserting after section 1448 (7 U.S.C. 3222c) the following:
        ``Subtitle H--Programs for Hispanic-Serving Institutions

     ``SEC. 1455. EDUCATION GRANTS PROGRAMS FOR HISPANIC-SERVING 
                   INSTITUTIONS.

       ``(a) Grant Authority.--The Secretary may make competitive 
     grants (or grants without regard to any requirement for 
     competition) to Hispanic-serving institutions for the purpose 
     of promoting and strengthening the ability of Hispanic-
     serving institutions to carry out education, applied 
     research, and related community development programs.
       ``(b) Use of Grant Funds.--Grants made under this section 
     shall be used--
       ``(1) to support the activities of consortia of Hispanic-
     serving institutions to enhance educational equity for 
     underrepresented students;
       ``(2) to strengthen institutional educational capacities, 
     including libraries, curriculum, faculty, scientific 
     instrumentation, instruction delivery systems, and student 
     recruitment and retention, in order to respond to identified 
     State, regional, national, or international educational needs 
     in the food and agricultural sciences;
       ``(3) to attract and support undergraduate and graduate 
     students from underrepresented groups in order to prepare 
     them for careers related to the food, agricultural, and 
     natural resource systems of the United States, beginning with 
     the mentoring of students at the high school level and 
     continuing with the provision of financial support for 
     students through their attainment of a doctoral degree; and
       ``(4) to facilitate cooperative initiatives between 2 or 
     more Hispanic-serving institutions, or between Hispanic-
     serving institutions and units of State government or the 
     private sector, to maximize the development and use of 
     resources, such as faculty, facilities, and equipment, to 
     improve food and agricultural sciences teaching programs.
       ``(c) Authorization of Appropriations.--There are 
     authorized to be appropriated to make grants under this 
     section $20,000,000 for fiscal year 1997.''.
       (b) Hispanic-Serving Institution Defined.--Paragraph (9) of 
     section 1404 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103) is 
     amended to read as follows:
       ``(9) the term `Hispanic-serving institution' has the 
     meaning given the term by section 316(b)(1) of the Higher 
     Education Act of 1965 (20 U.S.C. 1059c(b)(1));''.

     SEC. 816. INTERNATIONAL AGRICULTURAL RESEARCH AND EXTENSION.

       Section 1458(a)(8) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
     3291(a)(8)) is amended--
       (1) by striking ``establish'' and inserting ``continue''; 
     and
       (2) by striking ``to be''.

     SEC. 817. AUTHORIZATION OF APPROPRIATIONS FOR AGRICULTURAL 
                   RESEARCH PROGRAMS.

       Section 1463 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3311) is 
     amended by striking ``1995'' both places it appears and 
     inserting ``1997''.

     SEC. 818. AUTHORIZATION OF APPROPRIATIONS FOR EXTENSION 
                   EDUCATION.

       Section 1464 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3312) is 
     amended by striking ``fiscal year 1995'' and inserting ``each 
     of fiscal years 1995 through 1997''.

     SEC. 819. SUPPLEMENTAL AND ALTERNATIVE CROPS RESEARCH.

       (a) Extension of Program.--Section 1473D(a) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3319d(a)) is amended by striking ``1995'' and 
     inserting ``1997''.
       (b) Elimination of Pilot Nature of Program.--Section 1473D 
     of the National Agricultural Research, Extension, and 
     Teaching Policy Act of 1977 (7 U.S.C. 3319d) is amended--
       (1) in subsection (a), by striking ``and pilot'';
       (2) in subsection (c)(2)(B), by striking ``at pilot sites'' 
     and all that follows through ``the area'';
       (3) in subsection (c)(2)(C), by striking ``from pilot 
     sites'';
       (4) in subsection (c)(2)(D)--
       (A) by striking ``near such pilot sites''; and
       (B) by striking ``successful pilot program'' and inserting 
     ``successful program''; and
       (5) in paragraph (3), by striking ``pilot''.
       (c) Additional Authority.--Section 1473D(c)(3) of the 
     National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 (7 U.S.C. 3319d(c)(3)) is amended--
       (1) in subparagraph (C), by striking ``and'' at the end;
       (2) in subparagraph (D), by striking the period at the end 
     and inserting a semicolon; and
       (3) by adding at the end the following:
       ``(E) to conduct fundamental and applied research related 
     to the development of new commercial products derived from 
     natural plant material for industrial, medical, and 
     agricultural applications; and
       ``(F) to participate with colleges and universities, other 
     Federal agencies, and private sector entities in conducting 
     research described in subparagraph (E).''

     SEC. 820. AQUACULTURE ASSISTANCE PROGRAMS.

       (a) Definition.--Section 1404(3) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3103(3)) is amended by inserting ``ornamental 
     fish,'' after ``reptile,''.
       (b) Reports.--Section 1475 of the National Agricultural 
     Research, Extension, and Teaching Policy Act of 1977 (7 
     U.S.C. 3322) is amended--
       (1) by striking subsection (e); and
       (2) by redesignating subsections (f) and (g) as subsections 
     (e) and (f), respectively.
       (c) Authorization of Appropriations for Aquaculture 
     Research Facilities.--Section 1476(b) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3323(b)) is amended by striking ``1995'' and 
     inserting ``1997''.
       (d) Authorization of Appropriations for Research and 
     Extension.--Section 1477 of the National Agricultural 
     Research, Extension, and Teaching Policy Act of 1977 (7 
     U.S.C. 3324) is amended by striking ``1995'' and inserting 
     ``1997''.

     SEC. 821. AUTHORIZATION OF APPROPRIATIONS FOR RANGELAND 
                   RESEARCH.

       Section 1483(a) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3336(a)) 
     is amended by striking ``1995'' and inserting ``1997''.
  Subtitle B--Modification and Extension of Activities Under 1990 Act

     SEC. 831. WATER QUALITY RESEARCH, EDUCATION, AND 
                   COORDINATION.

       Section 1481(d) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5501(d)) is amended by striking 
     ``1995'' and inserting ``1997''.

     SEC. 832. NATIONAL GENETICS RESOURCES PROGRAM.

       (a) Functions.--Section 1632(d) of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 5841(d)) is 
     amended by striking paragraph (4) and inserting the 
     following:
       ``(4) unless otherwise prohibited by law, have the right to 
     make available on request, without charge and without regard 
     to the country from which the request originates, the genetic 
     material that the program assembles;''.
       (b) Authorization of Appropriations.--Section 1635(b) of 
     the Food, Agriculture, Conservation, and Trade Act of 1990 (7 
     U.S.C. 5844(b)) is amended by striking ``1995'' and inserting 
     ``1997''.

     SEC. 833. NATIONAL AGRICULTURAL WEATHER INFORMATION SYSTEM.

       Section 1641(c) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5855(c)) is amended by striking 
     ``1995'' and inserting ``1997''.

     SEC. 834. LIVESTOCK PRODUCT SAFETY AND INSPECTION PROGRAM.

       Section 1670(e) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5923(e)) is amended by striking 
     ``1995'' and inserting ``1997''.

     SEC. 835. PLANT GENOME MAPPING PROGRAM.

       Section 1671(g) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5924(g)) is amended by inserting 
     ``for fiscal years 1996 and 1997'' after ``appropriated''.

     SEC. 836. CERTAIN SPECIALIZED RESEARCH PROGRAMS.

       Subsections (d)(4), (e)(4), and (i) of section 1672 of the 
     Food, Agriculture, Conservation, and Trade Act of 1990 (7 
     U.S.C. 5925) are each amended by striking ``1995'' and 
     inserting ``1997''.

     SEC. 837. AGRICULTURAL TELECOMMUNICATIONS PROGRAM.

       Section 1673(h) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5926(h)) is amended by striking 
     ``1995'' and inserting ``1997''.

     SEC. 838. NATIONAL CENTERS FOR AGRICULTURAL PRODUCT QUALITY 
                   RESEARCH.

       (a) Purposes of National Centers.--Section 1675(a) of the 
     Food, Agriculture, Conservation, and Trade Act of 1990 (7 
     U.S.C. 5928(a)) is amended--
       (1) by redesignating paragraphs (5) and (6) as paragraphs 
     (6) and (7), respectively; and
       (2) by inserting after paragraph (4) the following:
       ``(5) enhance agricultural competitiveness through product 
     quality research and technology implementation;''.
       (b) Regional Basis of Centers.--Section 1675(b) of the 
     Food, Agriculture, Conservation, and Trade Act of 1990 (7 
     U.S.C. 5928(b)) is amended by striking paragraph (1) and 
     inserting the following:
       ``(1) Regional basis.--The centers shall be regionally 
     based units that conduct a broad spectrum of research, 
     development, and education

[[Page H2790]]

     programs to enhance the competitiveness, quality, safety and 
     wholesomeness of agricultural products.''.
       (c) Program Plan and Review.--Section 1675(d) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5928(b)) is amended--
       (1) in paragraph (1), by striking the second sentence; and
       (2) in paragraph (2), by striking ``, but not less'' and 
     all that follows through ``the Secretary''.
       (d) Authorization of Appropriations.--Section 1675(g)(1) of 
     the Food, Agriculture, Conservation, and Trade Act of 1990 (7 
     U.S.C. 5928(g)(1)) is amended by striking ``1995'' and 
     inserting ``1997''.

     SEC. 839. RED MEAT SAFETY RESEARCH CENTER.

       Section 1676 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5929) is amended to read as 
     follows:

     ``SEC. 1676. RED MEAT SAFETY RESEARCH CENTER.

       ``(a) Establishment of Center.--The Secretary of 
     Agriculture shall award a grant, on a competitive basis, to a 
     research facility described in subsection (b) to establish a 
     red meat safety research center.
       ``(b) Eligible Research Facility Described.--A research 
     facility eligible for a grant under subsection (a) is a 
     research facility that--
       ``(1) is part of a land-grant college or university, or 
     other federally supported agricultural research facility, 
     located in close proximity to a livestock slaughter and 
     processing facility; and
       ``(2) is staffed by professionals with a wide diversity of 
     scientific expertise covering all aspects of meat science.
       ``(c) Research Conducted.--The red meat safety research 
     center established under subsection (a) shall carry out 
     research related to general food safety, including--
       ``(1) the development of intervention strategies that 
     reduce microbiological contamination of carcass surfaces;
       ``(2) research regarding microbiological mapping of carcass 
     surfaces; and
       ``(3) the development of model hazard analysis and critical 
     control point plans.
       ``(d) Administration of Funds.--The Secretary of 
     Agriculture shall administer funds appropriated to carry out 
     this section.
       ``(e) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as are necessary for 
     fiscal year 1997 to carry out this section.''.

     SEC. 840. INDIAN RESERVATION EXTENSION AGENT PROGRAM.

       Section 1677 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5930) is amended--
       (1) by redesignating subsection (f) as subsection (g); and
       (2) by inserting after subsection (e) the following:
       ``(f) Reduced Regulatory Burden.--On a determination by the 
     Secretary of Agriculture that a program carried out under 
     this section has been satisfactorily administered for not 
     less than 2 years, the Secretary shall implement a reduced 
     reapplication process for the continued operation of the 
     program in order to reduce regulatory burdens on 
     participating university and tribal entities.''.

     SEC. 841. ASSISTIVE TECHNOLOGY PROGRAM FOR FARMERS WITH 
                   DISABILITIES.

       Section 1680 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5933) is amended--
       (1) in subsection (a)(6)(B), by striking ``1996'' and 
     inserting ``1997''; and
       (2) in subsection (b)(2), by striking ``1996'' and 
     inserting ``1997''.

     SEC. 842. NATIONAL RURAL INFORMATION CENTER CLEARINGHOUSE.

       Section 2381(e) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 3125b(e)) is amended by striking 
     ``1995'' and inserting ``1997''.

     SEC. 843. GLOBAL CLIMATE CHANGE.

       Section 2412 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 6710) is amended by striking 
     ``1996'' and inserting ``1997''.
        Subtitle C--Repeal of Certain Activities and Authorities

     SEC. 851. SUBCOMMITTEE ON FOOD, AGRICULTURAL, AND FORESTRY 
                   RESEARCH.

       Section 401(h) of the National Science and Technology 
     Policy, Organization, and Priorities Act of 1976 (42 U.S.C. 
     6651(h)) is amended by striking the second through fifth 
     sentences.

     SEC. 852. JOINT COUNCIL ON FOOD AND AGRICULTURAL SCIENCES.

       (a) Repeal.--Section 1407 of the National Agricultural 
     Research, Extension, and Teaching Policy Act of 1977 (7 
     U.S.C. 3122) is repealed.
       (b) Conforming Amendments.--
       (1) Section 1405 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3121) is 
     amended--
       (A) in paragraph (5), by striking ``Joint Council, Advisory 
     Board,'' and inserting ``Advisory Board''; and
       (B) in paragraph (11), by striking ``the Joint Council,''.
       (2) Section 1410(2) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3125(2)) 
     is amended by striking ``the recommendations of the Joint 
     Council developed under section 1407(f),''.
       (3) Section 1412 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3127) is 
     amended--
       (A) in the section heading, by striking ``THE JOINT 
     COUNCIL, ADVISORY BOARD,'' and inserting ``ADVISORY BOARD'';
       (B) in subsection (a)--
       (i) by striking ``Joint Council, the Advisory Board,'' and 
     inserting ``Advisory Board'';
       (ii) by striking ``the cochairpersons of the Joint Council 
     and'' each place it appears; and
       (iii) in paragraph (2), by striking ``one shall serve as 
     the executive secretary to the Joint Council, one shall serve 
     as the executive secretary to the Advisory Board,'' and 
     inserting ``one shall serve as the executive secretary to the 
     Advisory Board''; and
       (C) in subsections (b) and (c), by striking ``Joint 
     Council, Advisory Board,'' each place it appears and 
     inserting ``Advisory Board''.
       (4) Section 1413 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3128) is 
     amended--
       (A) in subsection (a), by striking ``Joint Council, the 
     Advisory Board,'' and inserting ``Advisory Board''; and
       (B) in subsection (b), by striking ``Joint Council, 
     Advisory Board,'' and inserting ``Advisory Board''.
       (5) Section 1434(c) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3196(c)) 
     is amended--
       (A) in the second sentence, by striking ``Joint Council, 
     the Advisory Board,'' and inserting ``Advisory Board''; and
       (B) in the fourth sentence, by striking ``the Joint 
     Council,''.

     SEC. 853. AGRICULTURAL SCIENCE AND TECHNOLOGY REVIEW BOARD.

       (a) Repeal.--Section 1408A of the National Agricultural 
     Research, Extension, and Teaching Policy Act of 1977 (7 
     U.S.C. 3123a) is repealed.
       (b) Conforming Amendments.--
       (1) Section 1404 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103) is 
     amended--
       (A) in paragraph (16)(F), by adding ``and'' at the end;
       (B) in paragraph (17), by striking ``; and'' at the end and 
     inserting a period; and
       (C) by striking paragraph (18).
       (2) Section 1405(12) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
     3121(12)) is amended by striking ``, after coordination with 
     the Technology Board,''.
       (3) Section 1410(2) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3125(2)) 
     (as amended by section 802(b)(2)) is amended by striking 
     ``and the recommendations of the Technology Board developed 
     under section 1408A(d)''.
       (4) Section 1412 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3127) 
     (as amended by section 852(b)(3)) is amended--
       (A) in the section heading, by striking ``AND TECHNOLOGY 
     BOARD'';
       (B) in subsection (a)--
       (i) by striking ``and the Technology Board'' each place it 
     appears; and
       (ii) in paragraph (2), by striking ``and one shall serve as 
     the executive secretary to the Technology Board''; and
       (C) in subsections (b) and (c), by striking ``and 
     Technology Board'' each place it appears.
       (5) Section 1413 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3128) 
     (as amended by section 852(b)(4)) is amended--
       (A) in subsection (a), by striking ``or the Technology 
     Board''; and
       (B) in subsection (b), by striking ``and the Technology 
     Board''.

     SEC. 854. ANIMAL HEALTH SCIENCE RESEARCH ADVISORY BOARD.

       Section 1432 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3194) is 
     repealed.

     SEC. 855. RESIDENT INSTRUCTION PROGRAM AT 1890 LAND-GRANT 
                   COLLEGES.

       Section 1446 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3222a) 
     is repealed.

     SEC. 856. GRANTS TO STATES FOR INTERNATIONAL TRADE 
                   DEVELOPMENT CENTERS.

       Section 1458A of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3292) is 
     repealed.

     SEC. 857. RANGELAND RESEARCH.

       (a) Reports.--Section 1481 of the National Agricultural 
     Research, Extension, and Teaching Policy Act of 1977 (7 
     U.S.C. 3334) is repealed.
       (b) Advisory Board.--Section 1482 of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3335) is repealed.

     SEC. 858. COMPOSTING RESEARCH AND EXTENSION PROGRAM.

       Section 1456 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 3130) is repealed.

     SEC. 859. EDUCATION PROGRAM REGARDING HANDLING OF 
                   AGRICULTURAL CHEMICALS AND AGRICULTURAL 
                   CHEMICAL CONTAINERS.

       (a) Repeal.--Section 1499A of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 3125c) is 
     repealed.
       (b) Conforming Amendment.--Section 1499(b) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5506(b)) is amended by striking ``and section 1499A''.

     SEC. 860. PROGRAM ADMINISTRATION REGARDING SUSTAINABLE 
                   AGRICULTURE RESEARCH AND EDUCATION.

       (a) Reporting Requirement.--Section 1622 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5812) is amended by striking subsection (b).
       (b) Advisory Council.--Section 1622 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5812) is amended--
       (1) in subsection (a)--
       (A) by striking paragraph (2);
       (B) in paragraph (3), by striking ``subsection (e)'' and 
     inserting ``subsection (b)''; and
       (C) by redesignating paragraphs (3) and (4) as paragraphs 
     (2) and (3), respectively;

[[Page H2791]]

       (2) by striking subsections (c) and (d);
       (3) by redesignating subsection (e) as subsection (b); and
       (4) in subsection (b)(2) (as so redesignated)--
       (A) by striking subparagraph (A); and
       (B) by redesignating subparagraphs (B) through (F) as 
     subparagraphs (A) through (E), respectively.
       (c) Conforming Amendments.--
       (1) Section 1619(b) of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (7 U.S.C. 5801(b)) is amended--
       (A) by striking paragraph (7); and
       (B) by redesignating paragraphs (8), (9), and (10) as 
     paragraphs (7), (8), and (9), respectively.
       (2) Section 1621(c) of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (7 U.S.C. 5811(c)) is amended--
       (A) in paragraph (1)--
       (i) by striking subparagraph (A); and
       (ii) by redesignating subparagraphs (B) through (E) as 
     subparagraphs (A) through (D), respectively; and
       (B) in paragraph (2)--
       (i) by striking subparagraph (A); and
       (ii) by redesignating subparagraphs (B) through (F) as 
     subparagraphs (A) through (E), respectively.
       (3) Section 1628(b) of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (7 U.S.C. 5831(b)) is amended by 
     striking ``Advisory Council, the Soil Conservation Service,'' 
     and inserting ``Natural Resources Conservation Service''.

     SEC. 861. RESEARCH REGARDING PRODUCTION, PREPARATION, 
                   PROCESSING, HANDLING, AND STORAGE OF 
                   AGRICULTURAL PRODUCTS.

       Subtitle E of title XVI of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 5871 et seq.) 
     is repealed.

     SEC. 862. PLANT AND ANIMAL PEST AND DISEASE CONTROL PROGRAM.

       (a) Repeal.--Subtitle F of title XVI of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5881 et seq.) is repealed.
       (b) Conforming Amendments.--
       (1) Section 28(b)(2)(A) of the Federal Insecticide, 
     Fungicide, and Rodenticide Act (7 U.S.C. 136w-3(b)(2)(A)) is 
     amended by striking ``and the information required by section 
     1651 of the Food, Agriculture, Conservation, and Trade Act of 
     1990''.
       (2) Section 1627(a)(3) of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 5821(a)(3)) is 
     amended by striking ``and section 1650''.
       (3) Section 1628 of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (7 U.S.C. 5831) is amended by striking 
     ``section 1650,'' each place it appears in subsections (a) 
     and (d).
       (4) Section 1629 of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (7 U.S.C. 5832) is amended by striking 
     ``section 1650,'' each place it appears in subsections (f) 
     and (g)(11).

     SEC. 863. CERTAIN SPECIALIZED RESEARCH PROGRAMS.

       Section 1672 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5925) is amended--
       (1) by striking subsections (a), (f), (g), (h), and (j); 
     and
       (2) by redesignating subsections (i) and (k) as subsections 
     (f) and (g), respectively.

     SEC. 864. COMMISSION ON AGRICULTURAL RESEARCH FACILITIES.

       Section 1674 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5927) is repealed.

     SEC. 865. SPECIAL GRANT TO STUDY CONSTRAINTS ON AGRICULTURAL 
                   TRADE.

       Section 1678 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5931) is repealed.

     SEC. 866. PILOT PROJECT TO COORDINATE FOOD AND NUTRITION 
                   EDUCATION PROGRAMS.

       Section 1679 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5932) is repealed.

     SEC. 867. DEMONSTRATION AREAS FOR RURAL ECONOMIC DEVELOPMENT.

       Section 2348 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 2662a) is repealed.

     SEC. 868. TECHNICAL ADVISORY COMMITTEE REGARDING GLOBAL 
                   CLIMATE CHANGE.

       Section 2404 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 6703) is repealed.

     SEC. 869. COMMITTEE OF NINE UNDER HATCH ACT OF 1887.

       Section 3(c)3 of the Act of March 2, 1887 (commonly known 
     as the ``Hatch Act of 1887''; 7 U.S.C. 361c(c)3) is amended 
     by striking ``, and shall be used'' and all that follows 
     through ``by this paragraph''.

     SEC. 870. COTTON CROP REPORTS.

       The Act of May 3, 1924 (43 Stat. 115, chapter 149; 7 U.S.C. 
     475), is repealed.

     SEC. 871. RURAL ECONOMIC AND BUSINESS DEVELOPMENT AND 
                   ADDITIONAL RESEARCH GRANTS UNDER TITLE V OF 
                   RURAL DEVELOPMENT ACT OF 1972.

       Section 502 of the Rural Development Act of 1972 (7 U.S.C. 
     2662) is amended by striking subsections (g) and (j).

     SEC. 872. HUMAN NUTRITION RESEARCH.

       Section 1452 of the National Agricultural Research, 
     Extension, and Teaching Policy Act Amendments of 1985 (Public 
     Law 99-198; 7 U.S.C. 3173 note) is repealed.

     SEC. 873. GRANTS TO UPGRADE 1890 LAND-GRANT COLLEGE EXTENSION 
                   FACILITIES.

       Section 1416 of the National Agricultural Research, 
     Extension, and Teaching Policy Act Amendments of 1981 (7 
     U.S.C. 3224) is repealed.

     SEC. 874. INDIAN SUBSISTENCE FARMING DEMONSTRATION GRANT 
                   PROGRAM.

       Subtitle C of title IX of the Food, Agriculture, 
     Conservation, and Trade Act Amendments of 1991 (Public Law 
     102-237; 7 U.S.C. 5930 note) is repealed.
             Subtitle D--Miscellaneous Research Provisions

     SEC. 881. CRITICAL AGRICULTURAL MATERIALS RESEARCH.

       (a) Reports.--Section 4 of the Critical Agricultural 
     Materials Act (7 U.S.C. 178b) is amended--
       (1) by striking subsection (g); and
       (2) by redesignating subsection (h) as subsection (g).
       (b) Authorization of Appropriations.--Section 16(a) of the 
     Critical Agricultural Materials Act (7 U.S.C. 178n(a)) is 
     amended by striking ``1995'' and inserting ``1997''.

     SEC. 882. MEMORANDUM OF AGREEMENT REGARDING 1994 
                   INSTITUTIONS.

       Section 533 of the Equity in Educational Land-Grant Status 
     Act of 1994 (Public Law 103-382; 7 U.S.C. 301 note) is 
     amended by adding at the end the following:
       ``(d) Memorandum of Agreement.--Not later than January 6, 
     1997, the Secretary shall develop and implement a formal 
     memorandum of agreement with the 1994 Institutions to 
     establish programs to ensure that tribally controlled 
     colleges and Native American communities equitably 
     participate in Department of Agriculture employment, 
     programs, services, and resources.''.

     SEC. 883. SMITH-LEVER ACT FUNDING FOR 1890 LAND-GRANT 
                   COLLEGES, INCLUDING TUSKEGEE UNIVERSITY.

       (a) Eligibility for Funds.--Section 3(d) of the Act of May 
     8, 1914 (commonly known as the ``Smith-Lever Act''; 7 U.S.C. 
     343(d)), is amended by adding at the end the following: ``A 
     college or university eligible to receive funds under the Act 
     of August 30, 1890 (7 U.S.C. 321 et seq.), including Tuskegee 
     University, may apply for and receive directly from the 
     Secretary of Agriculture--
       ``(1) amounts made available under this subsection after 
     September 30, 1995, to carry out programs or initiatives for 
     which no funds were made available under this subsection for 
     fiscal year 1995, or any previous fiscal year, as determined 
     by the Secretary; and
       ``(2) amounts made available after September 30, 1995, to 
     carry out programs or initiatives funded under this 
     subsection prior to that date that are in excess of the 
     highest amount made available for the programs or initiatives 
     under this subsection for fiscal year 1995, or any previous 
     fiscal year, as determined by the Secretary.''.
       (b) Conforming Amendment.--The third sentence of section 
     1444(a) of the National Agricultural Research, Extension, and 
     Teaching Policy Act of 1977 (7 U.S.C. 3221(a)) is amended by 
     inserting before the period at the end the following: ``, 
     except that for the purpose of this calculation, the total 
     appropriations shall not include amounts made available after 
     September 30, 1995, under section 3(d) of that Act (7 U.S.C. 
     343(d)), to carry out programs or initiatives for which no 
     funds were made available under section 3(d) of that Act for 
     fiscal year 1995, or any previous fiscal year, as determined 
     by the Secretary, and shall not include amounts made 
     available after September 30, 1995, to carry out programs or 
     initiatives funded under section 3(d) of that Act prior to 
     that date that are in excess of the highest amount made 
     available for the programs or initiatives for fiscal year 
     1995, or any previous fiscal year, as determined by the 
     Secretary''.

     SEC. 884. AGRICULTURAL RESEARCH FACILITIES.

       (a) Research Facilities.--The Research Facilities Act (7 
     U.S.C. 390 et seq.) is amended to read as follows:

     ``SECTION 1. SHORT TITLE.

       ``This Act may be cited as the `Research Facilities Act'.

     ``SEC. 2. DEFINITIONS.

       ``In this Act:
       ``(1) Agricultural research facility.--The term 
     `agricultural research facility' means a proposed facility 
     for research in food and agricultural sciences for which 
     Federal funds are requested by a college, university, or 
     nonprofit institution to assist in the construction, 
     alteration, acquisition, modernization, renovation, or 
     remodeling of the facility.
       ``(2) Congressional agriculture committees.--The term 
     `congressional agriculture committees' means the Committee on 
     Appropriations and the Committee on Agriculture of the House 
     of Representatives and the Committee on Appropriations and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate.
       ``(3) Food and agricultural sciences.--The term `food and 
     agricultural sciences' means--
       ``(A) agriculture, including soil and water conservation 
     and use, the use of organic materials to improve soil tilth 
     and fertility, plant and animal production and protection, 
     and plant and animal health;
       ``(B) the processing, distribution, marketing, and 
     utilization of food and agricultural products;
       ``(C) forestry, including range management, production of 
     forest and range products, multiple use of forests and 
     rangelands, and urban forestry;
       ``(D) aquaculture (as defined in section 1404(3) of the 
     National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 (7 U.S.C. 3103(3));
       ``(E) human nutrition;
       ``(F) production inputs, such as energy, to improve 
     productivity; and
       ``(G) germ plasm collection and preservation.
       ``(4) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture.
       ``(5) Task force.--The term `task force' means the 
     Strategic Planning Task Force established under section 4.

     ``SEC. 3. REVIEW PROCESS.

       ``(a) Submission to Secretary.--Each proposal for an 
     agricultural research facility shall

[[Page H2792]]

     be submitted to the Secretary for review. The Secretary shall 
     review the proposals in the order in which the proposals are 
     received.
       ``(b) Application Process.--In consultation with the 
     congressional agriculture committees, the Secretary shall 
     establish an application process for the submission of 
     proposals for agricultural research facilities.
       ``(c) Criteria for Approval.--
       ``(1) Determination by secretary.--With respect to each 
     proposal for an agricultural research facility submitted 
     under subsection (a), the Secretary shall determine whether 
     the proposal meets the criteria set forth in paragraph (2).
       ``(2) Criteria.--A proposal for an agricultural research 
     facility shall meet the following criteria:
       ``(A) Non-federal share.--The proposal shall certify the 
     availability of at least a 50 percent non-Federal share of 
     the cost of the facility. The non-Federal share shall be paid 
     in cash and may include funding from private sources or from 
     units of State or local government.
       ``(B) Nonduplication of facilities.--The proposal shall 
     demonstrate how the agricultural research facility would be 
     complementary to, and not duplicative of, facilities of 
     colleges, universities, and nonprofit institutions, and 
     facilities of the Agricultural Research Service, within the 
     State and region.
       ``(C) National research priorities.--The proposal shall 
     demonstrate how the agricultural research facility would 
     serve--
       ``(i) 1 or more of the national research policies and 
     priorities set forth in section 1402 of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3101); and
       ``(ii) regional needs.
       ``(D) Long-term support.--The proposal shall demonstrate 
     that the recipient college, university, or nonprofit 
     institution has the ability and commitment to support the 
     long-term, ongoing operating costs of--
       ``(i) the agricultural research facility after the facility 
     is completed; and
       ``(ii) each program to be based at the facility.
       ``(d) Evaluation of Proposals.--Not later than 90 days 
     after receiving a proposal under subsection (a), the 
     Secretary shall--
       ``(1) evaluate and assess the merits of the proposal, 
     including the extent to which the proposal meets the criteria 
     set forth in subsection (c); and
       ``(2) report to the congressional agriculture committees on 
     the results of the evaluation and assessment.

     ``SEC. 4. TASK FORCE ON 10-YEAR STRATEGIC PLAN FOR 
                   AGRICULTURAL RESEARCH FACILITIES.

       ``(a) Establishment.--Not later than 6 months after the 
     date of enactment of the Federal Agriculture Improvement and 
     Reform Act of 1996, the Secretary shall establish a task 
     force, to be known as the `Strategic Planning Task Force'. 
     The task force shall be comprised of 15 members.
       ``(b) Composition.--The Secretary shall select the members 
     of the task force from a list of individuals recommended by 
     the Advisory Board established under section 1408 of the 
     National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 (7 U.S.C. 3123). In submitting the list to 
     the Secretary, the board may recommend for selection 
     individuals (including members of the Advisory Board) who 
     have expertise in facilities development, modernization, 
     construction, consolidation, and closure.
       ``(c) Duties.--The task force shall review all currently 
     operating agricultural research facilities constructed in 
     whole or in part with Federal funds, and all planned 
     agricultural research facilities proposed to be constructed 
     with Federal funds, pursuant to criteria established by the 
     Secretary, to ensure that a comprehensive research capacity 
     is maintained.
       ``(d) 10-Year Strategic Plan.--Not later than 2 years after 
     the task force is established, the task force shall prepare 
     and submit to the Secretary and the congressional agriculture 
     committees a 10-year strategic plan, reflecting both national 
     and regional perspectives, for development, modernization, 
     construction, consolidation, and closure of Federal 
     agricultural research facilities and agricultural research 
     facilities proposed to be constructed with Federal funds.
       ``(e) Applicability of Federal Advisory Committee Act.--
       ``(1) Public meetings.--All meetings of the task force 
     shall be publicly announced in advance and shall be open to 
     the public. Detailed minutes of meetings and other 
     appropriate records of the activities of the task force shall 
     be kept and made available to the public on request.
       ``(2) Exemption.--The Federal Advisory Committee Act (5 
     U.S.C. App.) and title XVIII of the Food and Agriculture Act 
     of 1977 (7 U.S.C. 2281 et seq.) shall not apply to the task 
     force.
       ``(f) Definition of Agricultural Research Facility.--
     Notwithstanding section 2(1), in this section the term 
     `agricultural research facility' means a facility for 
     research in food and agricultural sciences.

     ``SEC. 5. APPLICABILITY OF FEDERAL ADVISORY COMMITTEE ACT.

       ``The Federal Advisory Committee Act (5 U.S.C. App.) and 
     title XVIII of the Food and Agriculture Act of 1977 (7 U.S.C. 
     2281 et seq.) shall not apply to a panel or board created 
     solely for the purpose of reviewing applications or proposals 
     submitted under this Act.

     ``SEC. 6. AUTHORIZATION OF APPROPRIATIONS.

       ``(a) In General.--Subject to subsection (b), there are 
     authorized to be appropriated such sums as are necessary for 
     fiscal years 1996 and 1997 for the study, plan, design, 
     structure, and related costs of agricultural research 
     facilities under this Act.
       ``(b) Allowable Administrative Costs.--Not more than 3 
     percent of the funds made available for any project for an 
     agricultural research facility shall be available for 
     administration of the project.''.
       (b) Application of Amendment.--The amendment made by 
     subsection (a), other than section 4 of the Research 
     Facilities Act (as amended by subsection (a)), shall not 
     apply to any project for an agricultural research facility 
     for which funds have been made available for a feasibility 
     study or for any phase of the project prior to October 1, 
     1995.
       (c) Authorization of Appropriations for Federal 
     Facilities.--Section 1431 of the National Agricultural 
     Research, Extension, and Teaching Policy Act Amendments of 
     1985 (Public Law 99-198; 99 Stat. 1556) is amended--
       (1) in subsection (a)--
       (A) by striking ``(a)''; and
       (B) by striking ``1995'' and inserting ``1997''; and
       (2) by striking subsection (b).
       (d) Conforming Amendment.--Section 1463(a) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3311(a)) is amended by striking ``1416,''.

     SEC. 885. NATIONAL COMPETITIVE RESEARCH INITIATIVE.

       (a) Authorization of Appropriations for Competitive 
     Grants.--Subsection (b)(10) of the Competitive, Special, and 
     Facilities Research Grant Act (7 U.S.C. 450i(b)(10)) is 
     amended--
       (1) by striking ``fiscal year 1995'' and inserting ``each 
     of fiscal years 1995 through 1997''; and
       (2) in subparagraph (B), by striking ``20 percent'' and 
     inserting ``40 percent''.
       (b) Availability of Funds.--Subsection (b) of the 
     Competitive, Special, and Facilities Research Grant Act (7 
     U.S.C. 450i(b)) is amended by adding at the end the 
     following:
       ``(11) Availability of Funds.--Funds made available under 
     paragraph (10) shall be available for obligation for a 2-year 
     period beginning on October 1 of the fiscal year for which 
     the funds are made available.''.

     SEC. 886. RURAL DEVELOPMENT RESEARCH AND EDUCATION.

       Section 502(a) of the Rural Development Act of 1972 (7 
     U.S.C. 2662(a)) is amended by inserting after the first 
     sentence the following: ``The rural development extension 
     programs shall also promote coordinated and integrated rural 
     community initiatives that advance and empower capacity 
     building through leadership development, entrepreneurship, 
     business development and management training, and strategic 
     planning to increase jobs, income, and quality of life in 
     rural communities.''.

     SEC. 887. DAIRY GOAT RESEARCH PROGRAM.

       Section 1432(b)(5) of the National Agricultural Research, 
     Extension, and Teaching Policy Act Amendments of 1981 (Public 
     Law 97-98; 7 U.S.C. 3222 note) is amended by striking 
     ``1995'' and inserting ``1997''.

     SEC. 888. COMPETITIVE GRANTS FOR RESEARCH TO ERADICATE AND 
                   CONTROL BROWN CITRUS APHID AND CITRUS TRISTEZA 
                   VIRUS.

       Section 1672 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5925) (as amended by section 863) 
     is amended by inserting before subsection (b) the following:
       ``(a) Brown Citrus Aphid and Citrus Tristeza Virus.--
       ``(1) Research grants authorized.--The Secretary of 
     Agriculture may make competitive grants available to support 
     research for the purpose of--
       ``(A) developing methods to eradicate the brown citrus 
     aphid and the citrus tristeza virus from citrus crops grown 
     in the United States; or
       ``(B) adapting citrus crops grown in the United States to 
     the brown citrus aphid and the citrus tristeza virus.
       ``(2) Method of providing grants.--Grants authorized under 
     this subsection shall be made in the same manner, and shall 
     be subject to the same conditions, as provided for 
     competitive grants under the Competitive, Special, and 
     Facilities Research Grant Act (7 U.S.C. 450i).
       ``(3) Authorization of appropriations.--There are 
     authorized to be appropriated to carry out this subsection 
     $3,000,000 for fiscal year 1997.''.

     SEC. 889. STUTTGART NATIONAL AQUACULTURE RESEARCH CENTER.

       (a) Transfer of Functions to Secretary of Agriculture.--
       (1) Purpose.--The first section of Public Law 85-342 (16 
     U.S.C. 778) is amended--
       (A) by striking ``Secretary of the Interior'' and all that 
     follows through ``directed to'' and inserting ``Secretary of 
     Agriculture shall'';
       (B) by striking ``an experiment station or stations'' and 
     inserting ``1 or more centers''; and
       (C) in paragraph (5), by striking ``Department of 
     Agriculture'' and inserting ``Secretary of the Interior''.
       (2) Authority.--Section 2 of Public Law 85-342 (16 U.S.C. 
     778a) is amended by striking ``, the Secretary'' and all that 
     follows through ``authorized'' and inserting ``, the 
     Secretary of Agriculture is authorized''.
       (3) Assistance.--Section 3 of Public Law 85-342 (16 U.S.C. 
     778b) is amended--
       (A) by striking ``Secretary of the Interior'' and inserting 
     ``Secretary of Agriculture''; and
       (B) by striking ``Department of Agriculture'' and inserting 
     ``Secretary of the Interior''.
       (b) Transfer of Fish Farming Experimental Laboratory to 
     Department of Agriculture.--
       (1) Designation of stuttgart national aquaculture research 
     center.--
       (A) In general.--The Fish Farming Experimental Laboratory 
     in Stuttgart, Arkansas (including the facilities in Kelso, 
     Arkansas), shall be known and designated as the ``Stuttgart 
     National Aquaculture Research Center''.
       (B) References.--Any reference in a law, map, regulation, 
     document, paper, or other record of the United States to the 
     laboratory referred to in subparagraph (A) shall be deemed to

[[Page H2793]]

     be a reference to the ``Stuttgart National Aquaculture 
     Research Center''.
       (2) Transfer of laboratory to department of agriculture.--
     Subject to section 1531 of title 31, United States Code, not 
     later than 90 days after the date of enactment of this Act, 
     there are transferred to the Department of Agriculture--
       (A) the personnel employed in connection with the 
     laboratory referred to in paragraph (1)(A);
       (B) the assets, liabilities, contracts, and real and 
     personal property of the laboratory;
       (C) the records of the laboratory; and
       (D) the unexpended balance of appropriations, 
     authorizations, allocations, and other funds employed in 
     connection with, held in connection with, arising from, 
     available to, or to be made available in connection with the 
     laboratory.
       (3) Nonduplication of facilities.--The research center 
     referred to in paragraph (1)(A) shall be complementary to, 
     and not duplicative of, facilities of colleges, universities, 
     and nonprofit institutions, and facilities of the 
     Agricultural Research Service, within the State and region, 
     as determined by the Administrator of the Service.

     SEC. 890. EXPANSION OF AUTHORITIES RELATED TO NATIONAL 
                   ARBORETUM.

       (a) Solicitation of Gifts, Benefits, and Devises.--The 
     first sentence of section 5 of the Act of March 4, 1927 (20 
     U.S.C. 195), is amended by inserting ``solicit,'' after 
     ``authorized to''.
       (b) Concessions, Fees, and Voluntary Services.--The Act of 
     March 4, 1927 (20 U.S.C. 191 et seq.), is amended by adding 
     at the end the following:

     ``SEC. 6. CONCESSIONS, FEES, AND VOLUNTARY SERVICES.

       ``(a) In General.--Notwithstanding the Federal Property and 
     Administrative Services Act of 1949 (40 U.S.C. 471 et seq.) 
     and section 321 of the Act of June 30, 1932 (40 U.S.C. 303b), 
     the Secretary of Agriculture, in furtherance of the mission 
     of the National Arboretum, may--
       ``(1) negotiate agreements granting concessions at the 
     National Arboretum to nonprofit scientific or educational 
     organizations the interests of which are complementary to the 
     mission of the National Arboretum, except that the net 
     proceeds of the organizations from the concessions shall be 
     used exclusively for research and educational work for the 
     benefit of the National Arboretum;
       ``(2) provide by concession, on such terms as the Secretary 
     of Agriculture considers appropriate and necessary, for 
     commercial services for food, drink, and nursery sales, if an 
     agreement for a permanent concession under this paragraph is 
     negotiated with a qualified person submitting a proposal 
     after due consideration of all proposals received after the 
     Secretary of Agriculture provides reasonable public notice of 
     the intent of the Secretary to enter into such an agreement;
       ``(3) dispose of excess property, including excess plants 
     and fish, in a manner designed to maximize revenue from any 
     sale of the property, including by way of public auction, 
     except that this paragraph shall not apply to the free 
     dissemination of new varieties of seeds and germ plasm in 
     accordance with section 520 of the Revised Statutes (commonly 
     known as the `Department of Agriculture Organic Act of 1862') 
     (7 U.S.C. 2201);
       ``(4) charge such fees as the Secretary of Agriculture 
     considers reasonable for temporary use by individuals or 
     groups of National Arboretum facilities and grounds for any 
     purpose consistent with the mission of the National 
     Arboretum;
       ``(5) charge such fees as the Secretary of Agriculture 
     considers reasonable for the use of the National Arboretum 
     for commercial photography or cinematography;
       ``(6) publish, in print and electronically and without 
     regard to laws relating to printing by the Federal 
     Government, informational brochures, books, and other 
     publications concerning the National Arboretum or the 
     collections of the Arboretum; and
       ``(7) license use of the National Arboretum name and logo 
     for public service or commercial uses.
       ``(b) Use of Funds.--Any funds received or collected by the 
     Secretary of Agriculture as a result of activities described 
     in subsection (a) shall be retained in a special fund in the 
     Treasury for the use and benefit of the National Arboretum as 
     the Secretary of Agriculture considers appropriate.
       ``(c) Acceptance of Voluntary Services.--The Secretary of 
     Agriculture may accept the voluntary services of 
     organizations described in subsection (a)(1), and the 
     voluntary services of individuals (including employees of the 
     National Arboretum), for the benefit of the National 
     Arboretum.''.

     SEC. 891. TRANSFER OF AQUACULTURAL RESEARCH CENTER.

       (a) Transfer of Fish Culture Laboratory to Department of 
     Agriculture.--
       (1) Designation of claude harris national aquacultural 
     research center.--
       (A) In general.--The Southeastern Fish Culture Laboratory 
     in Marion, Alabama, shall be known and designated as the 
     ``Claude Harris National Aquacultural Research Center''.
       (B) References.--Any reference in a law, map, regulation, 
     document, paper, or other record of the United States to the 
     laboratory referred to in subparagraph (A) shall be deemed to 
     be a reference to the ``Claude Harris National Aquacultural 
     Research Center''.
       (2) Transfer of laboratory to department of agriculture.--
     Subject to section 1531 of title 31, United States Code, not 
     later than 90 days after the date of enactment of this Act, 
     the Secretary of the Interior may transfer, in whole or in 
     part, to the Department of Agriculture, with the consent of 
     the Secretary of Agriculture--
       (A) the personnel employed in connection with the 
     laboratory referred to in paragraph (1);
       (B) the assets, liabilities, contracts, and real and 
     personal property of the laboratory;
       (C) the records of the laboratory; and
       (D) the unexpended balance of appropriations, 
     authorizations, allocations, and other funds employed in 
     connection with, held in connection with, arising from, 
     available to, or to be made available in connection with the 
     laboratory.
       (b) Nonduplication of Facilities.--The research center 
     designated by subsection (a) shall be complementary to, and 
     not duplicative of, facilities of colleges, universities, and 
     nonprofit institutions, and facilities of the Agricultural 
     Research Service, within the State and region, as determined 
     by the Secretary of Agriculture.

     SEC. 892. USE OF REMOTE SENSING DATA AND OTHER DATA TO 
                   ANTICIPATE POTENTIAL FOOD, FEED, AND FIBER 
                   SHORTAGES OR EXCESSES AND TO PROVIDE TIMELY 
                   INFORMATION TO ASSIST FARMERS WITH PLANTING 
                   DECISIONS.

       (a) Findings.--Congress finds that--
       (1) remote sensing data can be useful to predict impending 
     famine problems and forest infestations in time to allow 
     remedial action;
       (2) remote sensing data can inform the agricultural 
     community as to the condition of crops and the land that 
     sustains those crops; and
       (3) remote sensing data and other data can be valuable, 
     when received on a timely basis, in determining the need for 
     additional plantings of a particular crop or a substitute 
     crop.
       (b) Information Development.--The Secretary of Agriculture 
     and the Administrator of the National Aeronautics and Space 
     Administration, maximizing private funding and involvement, 
     shall provide farmers and other interested persons with 
     timely information, through remote sensing, on crop 
     conditions, fertilization and irrigation needs, pest 
     infiltration, soil conditions, projected food, feed, and 
     fiber production, and any other information available through 
     remote sensing.
       (c) Coordination.--The Secretary of Agriculture and the 
     Administrator of the National Aeronautics and Space 
     Administration shall jointly develop a proposal to provide 
     farmers and other prospective users with supply and demand 
     information for food and fibers.
       (d) Sunset.--The authorities provided by this section shall 
     expire 5 years after the date of enactment of this Act.

     SEC. 893. SENSE OF SENATE REGARDING METHYL BROMIDE 
                   ALTERNATIVE RESEARCH AND EXTENSION ACTIVITIES.

       It is the sense of the Senate that--
       (1) the Department of Agriculture should continue to make 
     methyl bromide alternative research and extension activities 
     a high priority of the Department; and
       (2) the Department of Agriculture, the Environmental 
     Protection Agency, producer and processor organizations, 
     environmental organizations, and State agencies should 
     continue their dialogue on the risks and benefits of 
     extending the 2001 phaseout deadline.
         Subtitle E--Research Authority After Fiscal Year 1997

     SEC. 897. AUTHORIZATION OF APPROPRIATIONS.

       Subject to section 898, there are authorized to be 
     appropriated for fiscal years 1998 through 2002 such sums as 
     are necessary to carry out the agricultural research, 
     extension, and education activities and initiatives of the 
     Department of Agriculture.

     SEC. 898. ACTIVITIES SUBJECT TO AVAILABILITY OF 
                   APPROPRIATIONS.

       During each of fiscal years 1998 through 2002, the 
     Secretary of Agriculture shall conduct only those 
     agricultural research, extension, and education activities 
     and initiatives of the Department of Agriculture for which 
     funds are specifically provided for the fiscal year in an 
     appropriation Act.
                        TITLE IX--MISCELLANEOUS
     Subtitle A--Commercial Transportation of Equine for Slaughter

     SEC. 901. FINDINGS.

       Because of the unique and special needs of equine being 
     transported to slaughter, Congress finds that it is 
     appropriate for the Secretary of Agriculture to issue 
     guidelines for the regulation of the commercial 
     transportation of equine for slaughter by persons regularly 
     engaged in that activity within the United States.

     SEC. 902. DEFINITIONS.

       In this subtitle:
       (1) Commercial transportation.--The term ``commercial 
     transportation'' means the regular operation for profit of a 
     transport business that uses trucks, tractors, trailers, or 
     semitrailers, or any combination thereof, propelled or drawn 
     by mechanical power on any highway or public road.
       (2) Equine for slaughter.--The term ``equine for 
     slaughter'' means any member of the Equidae family being 
     transferred to a slaughter facility, including an assembly 
     point, feedlot, or stockyard.
       (3) Person.--The term ``person''--
       (A) means any individual, partnership, corporation, or 
     cooperative association that regularly engages in the 
     commercial transportation of equine for slaughter; but
       (B) does not include any individual or other entity 
     referred to in subparagraph (A) that occasionally transports 
     equine for slaughter incidental to the principal activity of 
     the individual or other entity in production agriculture.

     SEC. 903. REGULATION OF COMMERCIAL TRANSPORTATION OF EQUINE 
                   FOR SLAUGHTER.

       (a) In General.--Subject to the availability of 
     appropriations, the Secretary of Agriculture may issue 
     guidelines for the regulation of the commercial 
     transportation of equine for slaughter by persons regularly 
     engaged in that activity within the United States.
       (b) Issues for Review.--In carrying out this section, the 
     Secretary of Agriculture shall review the food, water, and 
     rest provided to

[[Page H2794]]

     equine for slaughter in transit, the segregation of stallions 
     from other equine during transit, and such other issues as 
     the Secretary considers appropriate.
       (c) Additional Authority.--In carrying out this section, 
     the Secretary of Agriculture may--
       (1) require any person to maintain such records and reports 
     as the Secretary considers necessary;
       (2) conduct such investigations and inspections as the 
     Secretary considers necessary; and
       (3) establish and enforce appropriate and effective civil 
     penalties.

     SEC. 904. LIMITATION OF AUTHORITY TO EQUINE FOR SLAUGHTER.

       Nothing in this subtitle authorizes the Secretary of 
     Agriculture to regulate the routine or regular 
     transportation, to slaughter or elsewhere, of--
       (1) livestock other than equine; or
       (2) poultry.

     SEC. 905. EFFECTIVE DATE.

       This subtitle shall become effective on the first day of 
     the first month that begins 30 days or more after the date of 
     enactment of this Act.
                     Subtitle B--General Provisions

     SEC. 911. INTERSTATE QUARANTINE.

       The fourth sentence of section 8 of the Act of August 20, 
     1912 (7 U.S.C. 161), is amended by inserting after 
     ``Provided, That'' the following: ``if the Secretary of 
     Agriculture determines under this section that it is 
     necessary to quarantine a State entirely comprised of 
     islands, the Secretary of Agriculture, in implementing the 
     restrictions authorized under this section, shall give 
     consideration to enhancing passenger movement and commerce on 
     and between islands in the State: Provided further, That''.

     SEC. 912. COTTON CLASSIFICATION SERVICES.

       (a) Extension of Authorization.--The first sentence of 
     section 3a of the Act of March 3, 1927 (commonly known as the 
     ``Cotton Statistics and Estimates Act'') (7 U.S.C. 473a), is 
     amended by striking ``1996'' and inserting ``2002''.
       (b) Cotton Classing Office Locations.--Section 4 of the Act 
     of March 3, 1927 (commonly known as the ``Cotton Statistics 
     and Estimates Act'') (7 U.S.C. 474), is amended by adding at 
     the end the following: ``The Secretary of Agriculture shall 
     maintain until at least January 1, 1999, all cotton classing 
     office locations in the State of Missouri that existed on 
     January 1, 1996.''.

     SEC. 913. PLANT VARIETY PROTECTION FOR CERTAIN TUBER 
                   PROPAGATED PLANT VARIETIES.

       (a) In General.--Section 42(a)(1)(B)(i) of the Plant 
     Variety Protection Act (7 U.S.C. 2402(a)(1)(B)(i)) is amended 
     by inserting after ``filing'' the following: ``, except that 
     in the case of a tuber propagated plant variety the Secretary 
     may waive the 4-year limitation for a period ending 1 year 
     after the date of enactment of the Federal Agriculture 
     Improvement and Reform Act of 1996''.
       (b) Term of Protection.--Section 83(b) of the Plant Variety 
     Protection Act (7 U.S.C. 2483(b)) is amended--
       (1) by striking ``(b) The term'' and inserting the 
     following:
       ``(b) Term.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     term'';
       (2) in the second sentence, by striking ``If the 
     certificate'' and inserting the following:
       ``(2) Exceptions.--If the certificate''; and
       (3) in paragraph (2) (as so designated), by striking 
     ``except that, in the case'' and inserting the following: 
     ``except that--
       ``(A) in the case of a tuber propagated plant variety 
     subject to a waiver granted under section 42(a)(1)(B)(i), the 
     term of the plant variety protection shall expire 20 years 
     after the date of the original grant of the plant breeder's 
     rights to the variety outside the United States; and
       ``(B) in the case''.

     SEC. 914. SWINE HEALTH PROTECTION.

       (a) Termination of State Primary Enforcement 
     Responsibility.--Section 10 of the Swine Health Protection 
     Act (7 U.S.C. 3809) is amended--
       (1) by redesignating subsection (c) as subsection (d); and
       (2) by inserting after subsection (b) the following:
       ``(c) Request of State Official.--
       ``(1) In general.--On request of the Governor or other 
     appropriate official of a State, the Secretary may terminate, 
     effective as soon as the Secretary determines is practicable, 
     the primary enforcement responsibility of a State under 
     subsection (a). In terminating the primary enforcement 
     responsibility under this subsection, the Secretary shall 
     work with the appropriate State official to determine the 
     level of support to be provided to the Secretary by the State 
     under this Act.
       ``(2) Reassumption.--Nothing in this subsection shall 
     prevent a State from reassuming primary enforcement 
     responsibility if the Secretary determines that the State 
     meets the requirements of subsection (a).''.
       (b) Advisory Committee.--The Swine Health Protection Act is 
     amended--
       (1) by striking section 11 (7 U.S.C. 3810); and
       (2) by redesignating sections 12, 13, and 14 (7 U.S.C. 
     3811, 3812, and 3813) as sections 11, 12, and 13, 
     respectively.

     SEC. 915. DESIGNATION OF MOUNT PLEASANT NATIONAL SCENIC AREA.

       Sections 1, 2, and 3(a)(1) of the George Washington 
     National Forest Mount Pleasant Scenic Area Act (Public Law 
     103-314; 16 U.S.C. 545 note) are each amended by striking 
     ``George Washington National Forest Mount Pleasant Scenic 
     Area'' and inserting ``Mount Pleasant National Scenic Area''.

     SEC. 916. PSEUDORABIES ERADICATION PROGRAM.

       Section 2506(d) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (21 U.S.C. 114i(d)) is amended by striking 
     ``1995'' and inserting ``2002''.

     SEC. 917. COLLECTION AND USE OF AGRICULTURAL QUARANTINE AND 
                   INSPECTION FEES.

       Section 2509 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (21 U.S.C. 136a) is amended by striking 
     subsection (a) and inserting the following:
       ``(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 is 
     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 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 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 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. 918. MEAT AND POULTRY INSPECTION.

       (a) Establishment of Safe Meat and Poultry Inspection 
     Panel.--
       (1) In general.--The Federal Meat Inspection Act is 
     amended--
       (A) by redesignating section 410 (21 U.S.C. 680) as section 
     411; and
       (B) by inserting after section 409 (21 U.S.C. 679) the 
     following:

     ``SEC. 410. SAFE MEAT AND POULTRY INSPECTION PANEL.

       ``(a) Establishment.--There is established in the 
     Department of Agriculture a permanent advisory panel to be 
     known as the `Safe Meat and Poultry Inspection Panel' 
     (referred to in this section as the `panel').
       ``(b) Duties.--
       ``(1) Review and evaluation.--The panel shall review and 
     evaluate, as the panel considers necessary, the adequacy, 
     necessity, safety, cost-effectiveness, and scientific merit 
     of--
       ``(A) inspection procedures of, and work rules and worker 
     relations involving Federal employees employed in, plants 
     inspected under this Act;
       ``(B) informal petitions or proposals for changes in 
     inspection procedures, processes, and techniques of plants 
     inspected under this Act;
       ``(C) formal changes in meat inspection regulations 
     promulgated under this Act, whether in notice, proposed, or 
     final form; and

[[Page H2795]]

       ``(D) such other matters as may be referred to the panel by 
     the Secretary regarding the quality or effectiveness of a 
     safe and cost-effective meat inspection system under this 
     Act.
       ``(2) Reports.--
       ``(A) In general.--The panel shall submit to the Secretary 
     a report on the results of each review and evaluation carried 
     out under paragraph (1), including such recommendations as 
     the panel considers appropriate.
       ``(B) Reports on formal changes.--In the case of a report 
     concerning a formal change in meat inspection regulations, 
     the report shall be made within the time limits prescribed 
     for formal comments on such changes.
       ``(C) Publication in federal register.--Each report of the 
     panel to the Secretary shall be published in the Federal 
     Register.
       ``(c) Secretarial Response.--Not later than 90 days after 
     the publication of a panel report under subsection (b)(2)(C), 
     the Secretary shall publish in the Federal Register any 
     response required of the Secretary to the report.
       ``(d) Composition of Panel.--The panel shall be composed of 
     7 members, not fewer than 5 of whom shall be from the food 
     science, meat science, or poultry science profession, 
     appointed to staggered terms not to exceed 3 years by the 
     Secretary from nominations received from the National 
     Institutes of Health and the Federation of American Societies 
     of Food Animal Science and based on the professional 
     qualifications of the nominees.
       ``(e) Nominations.--
       ``(1) Initial panel.--In constituting the initial panel, 
     the Secretary shall solicit 6 nominees from the National 
     Institutes of Health and 6 nominees from the Federation of 
     American Societies of Food Animal Science for membership on 
     the panel.
       ``(2) Vacancies.--Any subsequent vacancy on the panel shall 
     be filled by the Secretary after soliciting 2 nominees from 
     the National Institutes of Health and 2 nominees from the 
     Federation of American Societies of Food Animal Science.
       ``(3) Requirements for nominees.--
       ``(A) In general.--Each nominee provided under paragraph 
     (1) or (2) shall have a background in public health issues 
     and a scientific expertise in food, meat, or poultry science 
     or in veterinary science.
       ``(B) Submission of information.--The Secretary may require 
     nominees to submit such information as the Secretary 
     considers necessary prior to completing the selection 
     process.
       ``(4) Additional nominees.--If any list of nominees 
     provided under paragraph (1) or (2) is unsatisfactory to the 
     Secretary, the Secretary may request the nominating entities 
     to submit an additional list of nominees.
       ``(f) Travel Expenses.--While away from the home or regular 
     place of business of a member of the panel in the performance 
     of services for the panel, the member shall be allowed travel 
     expenses, including per diem in lieu of subsistence, at the 
     same rate as a person employed intermittently in the 
     Government service would be allowed under section 5703 of 
     title 5, United States Code.
       ``(g) Conflicts of Interest.--The Secretary shall 
     promulgate regulations regarding conflicts of interest with 
     respect to the members of the panel.
       ``(h) Exemption.--The Federal Advisory Committee Act (5 
     U.S.C. App.) and title XVIII of the Food and Agriculture Act 
     of 1977 (7 U.S.C. 2281 et seq.) shall not apply to the panel.
       ``(i) Funding.--From funds available to the Secretary to 
     carry out this Act and the Poultry Products Inspection Act 
     (21 U.S.C. 451 et seq.), the Secretary shall allocate such 
     sums as may be necessary to carry out this section.''.
       (2) Cross reference in poultry products inspection act.--
     The Poultry Products Inspection Act (21 U.S.C. 451 et seq.) 
     is amended by adding at the end the following:

     ``SEC. 30. SAFE MEAT AND POULTRY INSPECTION PANEL.

       ``(a) Review and Evaluation.--The advisory panel known as 
     the `Safe Meat and Poultry Inspection Panel' established by 
     section 410 of the Federal Meat Inspection Act shall review 
     and evaluate, as the panel considers necessary, the adequacy, 
     necessity, safety, cost-effectiveness, and scientific merit 
     of--
       ``(1) inspection procedures of, and work rules and worker 
     relations involving Federal employees employed in, plants 
     inspected under this Act;
       ``(2) informal petitions or proposals for changes in 
     inspection procedures, processes, and techniques of plants 
     inspected under this Act;
       ``(3) formal changes in poultry inspection regulations 
     promulgated under this Act, whether in notice, proposed, or 
     final form; and
       ``(4) such other matters as may be referred to the panel by 
     the Secretary regarding the quality or effectiveness of a 
     safe and cost-effective poultry inspection system under this 
     Act.
       ``(b) Reports.--
       ``(1) In general.--The Safe Meat and Poultry Inspection 
     Panel shall submit to the Secretary a report on the results 
     of each review and evaluation carried out under paragraph 
     (1), including such recommendations as the panel considers 
     appropriate.
       ``(2) Reports on formal changes.--In the case of a report 
     concerning a formal change in poultry inspection regulations, 
     the report shall be made within the time limits prescribed 
     for formal comments on such changes.''.
       (b) Interstate Shipment of State-Inspected Meat and 
     Poultry.--Not later than 90 days after the date of enactment 
     of this Act, the Secretary of Agriculture shall submit to 
     Congress recommendations concerning the steps necessary to 
     achieve interstate shipment of--
       (1) meat inspected under a State meat inspection program 
     developed and administered under section 301 of the Federal 
     Meat Inspection Act (21 U.S.C. 661); and
       (2) poultry inspected under a State poultry product 
     inspection program developed and administered under section 5 
     of the Poultry Products Inspection Act (21 U.S.C. 454).

     SEC. 919. REIMBURSABLE AGREEMENTS.

       (a) In General.--The Secretary of Agriculture (referred to 
     in this section as the ``Secretary'') may enter into 
     reimbursable fee agreements with persons for preclearance at 
     locations outside the United States of plants, plant 
     products, animals, and articles for movement into the United 
     States.
       (b) Overtime, Night, and Holiday Work.--Notwithstanding any 
     other provision of law, the Secretary may pay an employee of 
     the Department of Agriculture performing services relating to 
     imports into and exports from the United States for overtime, 
     night, and holiday work performed by the employee at a rate 
     of pay established by the Secretary.
       (c) Reimbursement.--
       (1) In general.--The Secretary may require persons for whom 
     preclearance services are performed to reimburse the 
     Secretary for any amounts paid by the Secretary for 
     performance of the services.
       (2) Crediting of funds.--All funds collected under 
     paragraph (1) shall be credited to the account that incurs 
     the costs and shall remain available until expended without 
     fiscal year limitation.
       (3) Late payment penalty.--
       (A) In general.--On failure of a person to reimburse the 
     Secretary for the costs of performance of preclearance 
     services--
       (i) the Secretary may assess a late payment penalty; and
       (ii) the overdue funds shall accrue interest in accordance 
     with section 3717 of title 31, United States Code.
       (B) Crediting of funds.--Any late payment penalty and any 
     accrued interest collected under this paragraph shall be 
     credited to the account that incurs the costs and shall 
     remain available until expended without fiscal year 
     limitation.

     SEC. 920. OVERSEAS TORT CLAIMS.

       (a) In General.--The Secretary of Agriculture may pay a 
     tort claim in the manner authorized by section 2672 of title 
     28, United States Code, if the claim arises outside the 
     United States in connection with activities of individuals 
     who are performing services for the Secretary.
       (b) Period for Presentation of Claim.--A claim may not be 
     allowed under this section unless the claim is presented in 
     writing to the Secretary of Agriculture within 2 years after 
     the date on which the claim accrues.
       (c) Finality.--Notwithstanding any other provision of law, 
     an award or denial of a claim by the Secretary of Agriculture 
     under this section is final.

     SEC. 921. OPERATION OF GRADUATE SCHOOL OF DEPARTMENT OF 
                   AGRICULTURE AS NONAPPROPRIATED FUND 
                   INSTRUMENTALITY.

       (a) Definitions.--In this section:
       (1) Graduate school.--The term ``Graduate School'' means 
     the Graduate School of the Department of Agriculture.
       (2) Board.--The term ``Board'' means the General 
     Administration Board of the Graduate School.
       (3) Director.--The term ``Director'' means the Director of 
     the Graduate School.
       (4) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (b) Operation as Nonappropriated Fund Instrumentality.--On 
     and after the date of enactment of this Act, the Graduate 
     School of the Department of Agriculture shall continue to 
     operate as a nonappropriated fund instrumentality of the 
     United States under the jurisdiction of the Department of 
     Agriculture.
       (c) Activities of Graduate School.--Under the general 
     supervision of the Secretary, the Graduate School shall 
     develop, administer, and provide educational, training, and 
     professional development activities, including educational 
     activities for Federal agencies, Federal employees, nonprofit 
     organizations, other entities, and members of the general 
     public.
       (d) Fees and Donations.--
       (1) Collection of fees.--The Graduate School may charge and 
     retain fair and reasonable fees for the activities provided 
     by the Graduate School. The amount of the fees shall be based 
     on the cost of the activities to the Graduate School.
       (2) Acceptance of donations.--
       (A) Acceptance and use authorized.--The Graduate School may 
     accept, use, hold, dispose, and administer gifts, bequests, 
     and devises of money, securities, and other real or personal 
     property made for the benefit of, or in connection with, the 
     Graduate School.
       (B) Exception.--The Graduate School shall not accept a 
     donation from a person that is actively engaged in a 
     procurement activity with the Graduate School or has an 
     interest that may be substantially affected by the 
     performance or nonperformance of an official duty of a member 
     of the Board or an employee of the Graduate School.
       (3) Not federal funds.--Fees collected under paragraph (1) 
     and amounts received under paragraph (2) shall not be 
     considered to be Federal funds and shall not be required to 
     be deposited in the Treasury of the United States.
       (e) General Administration Board and Director.--
       (1) Appointment as governing board.--The Secretary shall 
     appoint a General Administration Board to serve as a 
     governing board for the Graduate School and to supervise and 
     direct the activities of the Graduate School. The Board shall 
     be subject to regulation by the Secretary.
       (2) Duties of board.--The Board shall--
       (A) formulate broad policies in accordance with which the 
     Graduate School shall be administered;

[[Page H2796]]

       (B) take all steps necessary to ensure that the highest 
     possible educational standards are maintained by the Graduate 
     School;
       (C) exercise general supervision over the administration of 
     the Graduate School; and
       (D) establish such bylaws, rules, and procedures as may be 
     necessary for the fulfillment of the duties described in 
     subparagraphs (A), (B), and (C).
       (3) Appointment of director and other officers.--The Board 
     shall select a Director and such other officers as the Board 
     considers necessary to administer the Graduate School. The 
     Director and other officers shall serve on such terms and 
     perform such duties as the Board may prescribe.
       (4) Duties of director.--The Director shall be responsible, 
     subject to the supervision and direction of the Board, for 
     carrying out the functions of the Graduate School.
       (5) Borrowing and investment authority.--The Board may 
     authorize the Director--
       (A) to borrow money on the credit of the Graduate School; 
     and
       (B) to invest funds held in excess of the current operating 
     requirements of the Graduate School for purposes of 
     maintaining a reasonable reserve.
       (6) Liability.--The Director and the members of the Board 
     shall not be held personally liable for any loss or damage 
     that may accrue to the funds of the Graduate School as the 
     result of any act or exercise of discretion performed in 
     carrying out their duties under this section.
       (f) Employees.--Employees of the Graduate School are 
     employees of a nonappropriated fund instrumentality and shall 
     not be considered to be Federal employees.
       (g) Not a Federal Agency.--The Graduate School shall not be 
     considered to be a Federal agency for purposes of--
       (1) the Federal Advisory Committee Act (5 U.S.C. App.);
       (2) section 552 or 552a of title 5, United States Code; or
       (3) chapter 171 of title 28, United States Code;
       (h) Acquisition and Disposal of Property.--In order to 
     carry out the activities of the Graduate School, the Graduate 
     School may--
       (1) acquire real property in the District of Columbia and 
     in other places by lease, purchase, or otherwise;
       (2) maintain, enlarge, or remodel any such property;
       (3) have sole control of any such property; and
       (4) dispose of real and personal property without regard to 
     the Federal Property and Administrative Services Act of 1949 
     (40 U.S.C. 471 et seq.).
       (i) Contract Authority.--The Graduate School may enter into 
     contracts without regard to the Federal Property and 
     Administrative Services Act of 1949 (40 U.S.C. 471 et seq.) 
     or any other law that prescribes procedures for the 
     procurement of property or services by an executive agency.
       (j) Use of Department Facilities and Resources.--The 
     Graduate School may use the facilities and resources of the 
     Department of Agriculture, on the condition that any costs 
     incurred by the Department that are attributable solely to 
     Graduate School operations and all costs incurred by the 
     Graduate School arising out of such operations shall be paid 
     using funds of the Graduate School. Federal funds may not be 
     used to pay the costs.

     SEC. 922. STUDENT INTERNSHIP PROGRAMS.

       (a) Student Intern Subsistence Program.--
       (1) Definition of student intern.--In this subsection, the 
     term ``student intern'' means a person who--
       (A) is employed by the Department of Agriculture (referred 
     to in this section as the ``Department'') to assist 
     scientific, professional, administrative, or technical 
     employees of the Department; and
       (B) is a student in good standing at an institution of 
     higher education (as defined in section 1201 of the Higher 
     Education Act of 1965 (20 U.S.C. 1141)) pursuing a course of 
     study related to the field in which the person is employed by 
     the Department.
       (2) Payment of certain expenses by the secretary.--The 
     Secretary of Agriculture (referred to in this section as the 
     ``Secretary'') may, out of user fee funds or funds 
     appropriated to any agency of the Department, pay for lodging 
     expenses, subsistence expenses, and transportation expenses 
     of a student intern at the agency (including expenses of 
     transportation to and from the student intern's residence at 
     or near the institution of higher education attended by the 
     student intern and the official duty station at which the 
     student intern is employed).
       (b) Cooperation With Associations of Colleges and 
     Universities.--
       (1) Authority to cooperate.--Notwithstanding chapter 63 of 
     title 31, United States Code, the Secretary may enter into 
     cooperative agreements on an annual basis with 1 or more 
     associations of institutions of higher education (as defined 
     in section 1201 of the Higher Education Act of 1965 (20 
     U.S.C. 1141)) for the purpose of providing for Department 
     participation in internship programs for graduate and 
     undergraduate students who are selected by the associations 
     from students attending member institutions of the 
     associations and other institutions of higher education.
       (2) Internship program.--An internship program supported 
     under this subsection (referred to in this subsection as an 
     ``internship program'') shall provide work assignments for 
     students within the Department and such other activities as 
     the association that enters into the cooperative agreement 
     under paragraph (1) with respect to the internship program 
     (referred to in this subsection as the ``cooperating 
     association'') and the Secretary shall determine. The nature 
     of Department participation in an internship program shall be 
     developed jointly by the Secretary and the cooperating 
     association.
       (3) Program coordination.--The cooperating association 
     shall coordinate an internship program, including--
       (A) the recruitment of students;
       (B) arrangements for travel of the students to Washington, 
     District of Columbia, and to agency field locations;
       (C) the provision of housing for students, if required; and
       (D) all activities for the students that take place outside 
     the Department work assignments of the students.
       (4) Number and selection of students.--
       (A) Number.--A cooperative agreement entered into under 
     paragraph (1) shall specify the number of students that the 
     Department will host each year and a list of work assignments 
     to be provided for the students.
       (B) Selection.--The cooperating association shall provide 
     the Department with a pool of student candidates meeting the 
     requirements for each work assignment identified by the 
     Secretary. Final selection of the students for Department 
     internship positions shall be made by the Secretary.
       (5) Cost reimbursement.--From such amounts as the Secretary 
     determines are available each fiscal year for internship 
     programs, and subject to such regulations as the Secretary 
     may issue, the Secretary may reimburse a cooperating 
     association for the Department share of all direct and 
     indirect costs of an internship program, including student 
     stipends, transportation costs to the internship site, and 
     other costs of an internship program.
       (6) Lead agency.--The Secretary may designate a lead agency 
     within the Department to carry out this subsection.
       (7) Interagency agreements.--Agencies and offices within 
     the Department other than the lead agency--
       (A) may enter into interagency agreements with the lead 
     agency to provide work assignments for students participating 
     in an internship program; and
       (B) shall reimburse the lead agency for the direct and 
     indirect costs of each student assigned to the agency under 
     an internship program.
       (8) Federal employee status.--A student who participates in 
     an internship program shall not be considered a Federal 
     employee, except for purposes of chapter 81 of title 5, and 
     chapter 171 of title 28, United States Code.

     SEC. 923. CONVEYANCE OF EXCESS FEDERAL PERSONAL PROPERTY.

       Notwithstanding any other provision of law, the Secretary 
     of Agriculture may--
       (1) convey title to excess Federal personal property owned 
     by the Department of Agriculture, with or without monetary 
     compensation and for such purposes as are determined by the 
     Secretary, to--
       (A) any of the 1994 Institutions (as defined in section 532 
     of the Equity in Educational Land-Grant Status Act of 1994 
     (Public Law 103-382; 7 U.S.C. 301 note));
       (B) any Hispanic-serving institution (as defined in section 
     316(b) of the Higher Education Act of 1965 (20 U.S.C. 
     1059c(b))); and
       (C) any college or university eligible to receive funds 
     under the Act of August 30, 1890 (7 U.S.C. 321 et seq.), 
     including Tuskegee University; and
       (2) acquire from, exchange with, or dispose of personal 
     property to other Federal departments and agencies without 
     monetary compensation in furtherance of the purposes of this 
     section.

     SEC. 924. CONVEYANCE OF LAND TO WHITE OAK CEMETERY.

       (a) In General.--
       (1) Release of interest.--After execution of the agreement 
     described in subsection (b), the Secretary of Agriculture 
     shall release the condition stated in the deed on the land 
     described in subsection (c) that the land be used for public 
     purposes, and that if the land is not so used, that the land 
     revert to the United States. The release shall be on the 
     condition that the land be used exclusively for cemetery 
     purposes, and that if the land is not so used, that the land 
     revert to the United States.
       (2) Bankhead-jones farm tenant act.--Section 32(c) of the 
     Bankhead-Jones Farm Tenant Act (7 U.S.C. 1011(c)) shall not 
     apply to the release under paragraph (1).
       (b) Agreement.--The Secretary of Agriculture shall make the 
     release under subsection (a) on execution by the Board of 
     Trustees of the University of Arkansas, in consideration of 
     the release, of an agreement, satisfactory to the Secretary 
     of Agriculture, that--
       (1) the Board of Trustees will not sell, lease, exchange, 
     or otherwise dispose of the land described in subsection (c) 
     except to the White Oak Cemetery Association of Washington 
     County, Arkansas, or a successor organization, for exclusive 
     use for an expansion of the cemetery maintained by the 
     Association or successor organization; and
       (2) the proceeds of such a disposition of the land will be 
     deposited and held in an account open to inspection by the 
     Secretary of Agriculture, and used, if withdrawn from the 
     account, for public purposes.
       (c) Land Description.--The land described in this 
     subsection is the land conveyed to the Board of Trustees of 
     the University of Arkansas, with certain other land, by deed 
     dated November 18, 1953, comprising approximately 2.2 acres 
     located within property of the University of Arkansas in 
     Washington County, Arkansas, commonly known as the ``Savor 
     property'' and described as follows:
       The part of Section 20, Township 17 north, range 31 west, 
     beginning at the north corner of the White Oak Cemetery and 
     the University of Arkansas Agricultural Experiment Station 
     farm at Washington County road #874, running west 
     approximately 330 feet, thence south approximately 135 feet, 
     thence southeast approximately

[[Page H2797]]

     384 feet, thence north approximately 330 feet to the point of 
     beginning.

     SEC. 925. SALE OF LAND BY THE UNIVERSITY OF ARKANSAS.

       The Act of March 2, 1887 (commonly known as the ``Hatch Act 
     of 1887'') (7 U.S.C. 361a et seq.) shall not apply to the 
     sale by the University of Arkansas of the approximately 
     103.52 acres of land in Washington County, Arkansas, owned by 
     the University and commonly known as the ``Walker Tract'', if 
     the sale is made on the condition that all of the proceeds of 
     the sale are used for agricultural research facilities and 
     programs of the University of Arkansas.

     SEC. 926. DESIGNATION OF DALE BUMPERS SMALL FARMS RESEARCH 
                   CENTER.

       (a) In General.--The small farms research facility of the 
     Agricultural Research Service located near Booneville, 
     Arkansas, shall be known and designated as the ``Dale Bumpers 
     Small Farms Research Center''.
       (b) References.--Any reference in a law, map, regulation, 
     document, paper, or other record of the United States to the 
     research facility referred to in subsection (a) shall be 
     deemed to be a reference to the ``Dale Bumpers Small Farms 
     Research Center''.

     SEC. 927. DEPARTMENT OF AGRICULTURE WASHINGTON AREA STRATEGIC 
                   SPACE PLAN.

       The Secretary of Agriculture may obligate not more than 
     $5,000,000, from funds appropriated for agriculture buildings 
     and facilities and rental payments, for the improvement of 
     State and local roads relating to the construction of an 
     office complex at the Beltsville Agriculture Research Center, 
     Maryland, as part of the implementation of the Department of 
     Agriculture Washington Area Strategic Space Plan.

     SEC. 928. SEVERABILITY.

       If any provision of this Act or the application thereof to 
     any person or circumstance is held invalid, the invalidity 
     shall not affect other provisions or applications of this Act 
     that can be given effect without regard to the invalid 
     provision or application, and to this end the provisions of 
     this Act are severable.

       And the Senate agree to the same.
     Pat Roberts,
     Bill Emerson,
     Steve Gunderson,
     Thomas W. Ewing,
     Bill Barrett,
     Wayne Allard,
     John Boehner,
     Richard Pombo,
     E de la Garza,
     Charlie Rose,
     Charlie Stenholm,
     Gary Condit,
                                Managers on the Part of the House.

     Richard G. Lugar,
     Bob Dole,
     Jesse Helms,
     Thad Cochran,
     Mitch McConnell,
     Larry E. Craig,
     Patrick Leahy,
     Howell Heflin,
                               Managers on the Part of the Senate.

       JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE

        The Managers on the part of the House and the Senate at 
     the conference on the disagreeing votes of the two Houses on 
     the amendment of the Senate to the bill (H.R. 2854) to modify 
     the operation of certain agricultural programs, submit the 
     following joint statement to the House and the Senate in 
     explanation of the effect of the action agreed upon by the 
     managers and recommended in the accompanying conference 
     report:
        The Senate amendment struck out all of the House bill 
     after the enacting clause and inserted a substitute text.
        The House recedes from its disagreement to the amendment 
     of the Senate with an amendment which is a substitute for the 
     House bill and the Senate amendment. The differences between 
     the House bill, the Senate amendment, and the substitute 
     agreed to in conference are noted below, except for clerical 
     corrections, conforming changes made necessary by agreements 
     reached by the conferees, and minor drafting and clarifying 
     changes.

            Title I--Agricultural Market Transition Program

     (1) Short title
        The House bill names title 1 the ``Agriculture Market 
     Transition Program.'' (Section 1)
        The Senate amendment names the bill the ``Agriculture, 
     Reform and Improvement Act'' and title 1 ``The Agriculture 
     Market Transition Act.'' (Section 101)
        The Conference substitute adopts the Senate provision with 
     an amendment naming the bill the Federal Agriculture 
     Improvement and Reform Act (Section 1) and title I the 
     Agriculture Market Transition Act. (Section 101)


                  subtitle a--purpose and definitions

     (2) Purpose
        The House bill states that it is the purpose of this title 
     to authorize the use of binding production flexibility 
     contracts between the United States and producers; to make 
     nonrecourse marketing assistance loans; to improve the 
     operation of the peanut and sugar programs and; to terminate 
     price support authority under the Agriculture Act of 1949. 
     (Section 101)
        The Senate amendment has no comparable provision.
        The Conference substitute adopts the House provision with 
     an amendment deleting the reference to the Agriculture Act of 
     1949 and adding a reference to the establishment of the 
     Commission on 21st Century Production Agriculture. (Section 
     101)
     (3) Definitions
        The House bill, in Section 102 contains definitions of 
     terms used throughout Title I. ``Contract commodity'' 
     includes wheat, corn, grain sorghum, barley, oats, upland 
     cotton, and rice; ``contract acreage'' means one or more crop 
     acreage bases established under title V of the Agricultural 
     Act of 1949 that would have been in effect for the 1996 crop; 
     and ``loan commodity'' means each contract commodity, plus 
     extra long staple cotton and oilseeds.
        The Senate amendment, in Section 102, achieves the same 
     purpose but for technical differences.
        The Conference substitute adopts the House provision with 
     technical amendments. (Section 102)


              subtitle b--production flexibility contracts

     (4) Offers and terms
        The House bill, in Section 103(a), in paragraph (1), 
     authorizes the Secretary to enter into 7-year production 
     flexibility contracts between 1996 and 2002 with eligible 
     owners and operators on a farm containing eligible farmland. 
     In exchange for annual payments under the contract, the owner 
     or operator must agree to comply with the applicable 
     conservation plan for the farm, the wetland protection 
     requirements of title XII of the Food Security Act of 1985, 
     and the planting flexibility requirements of subsection (j). 
     The land under a contract must be maintained in an 
     agricultural or related activity; conversion to a non-
     agricultural commercial or industrial use.
        The Senate amendment, in Section 103, is similar but does 
     not restrict land subject to a contract to an agricultural 
     use.
        The Conference substitute adopts the House provision with 
     technical amendments removing references to the 
     ``conservation plan'' and instead requiring compliance with 
     highly erodible land and wetlands restrictions from the Food 
     Security Act of 1985. (Section 111(a))
     (5) Eligible owners and operators described
        The House bill, in Section 103(a), in paragraph (2), 
     describes eligible owners and operators, that include:
       (A) an owner who assumes all risk of producing a crop;
       (B) an owner who shares in the risk of producing a crop;
       (C) an operator with a share-rent lease regardless of the 
     length of such lease if the owner also enters into the 
     contract;
       (D) an operator with a cash rent lease that expires on or 
     after September 30, 2002, in which case the consent of the 
     owner is not required;
       (E) an operator with a cash rent lease that expires before 
     September 30, 2002, and the owner consents to the contract;
       (F) an owner with a cash rent lease, but only if the 
     operator declines to enter into a contract, in which case 
     payments under the contract will not begin until the fiscal 
     year following the year in which the lease expires; and
       (G) an owner or operator regardless of whether the owner or 
     operator purchased catastrophic risk protection for a fall-
     planted 1996 crop.
       The Senate amendment, in Section 103(a)(2), is identical 
     but for technical differences.
       The Conference substitute adopts the House provision with 
     technical amendments that replaced references to ``operator'' 
     with ``producers'' and that further clarify contract 
     eligibility.
       The Managers do not intend that there be any substantial 
     change in the existing landlord-tenant policy at USDA, which 
     has functioned successfully for several decades. State law on 
     tenancy should continue to govern the relationship between 
     landlords and tenants. Cash-rent landlords are allowed to be 
     signatories of the contract, and if the producer does not 
     enroll all the eligible cropland of a farm into a contract, 
     the consent of the owner is required. However, this is to 
     facilitate orderly transfer and any potential succession 
     situation relating to the contract and creates no additional 
     liability or obligation for the cash-rent landlord. The 
     purchase of catastrophic risk protection for 1996 crops is 
     not a factor for determining contract eligibility. (Section 
     111(b))
     (6) Tenants and sharecroppers
       The House bill, in Section 103(a), in paragraph(3), 
     instructs the Secretary to provide adequate safeguards to 
     protect the interests of tenants and sharecroppers.
       The Senate amendment is identical but for technical 
     differences.
       The Conference substitute adopts the House provision with 
     technical amendments. (Section 111(c))
     (7) Eligible cropland described
       The House bill, in Section 103(c) describes eligible 
     farmland, which is land that contains a crop acreage base, at 
     least of a portion of which was enrolled in the acreage 
     reduction programs authorized for a crop of rice, upland 
     cotton, feed grains, or wheat and which has served as the 
     basis for deficiency payments in at least one of the 1991 
     through 1995 crop years. With respect to contracts for 
     acreage enrolled in the CRP, such acreage must have crop 
     acreage base attributable to it.
       The Senate amendment, in Section 103 is similar but also 
     provides authority for the Secretary to establish a fair and 
     equitable crop acreage base for beginning farmers.

[[Page H2798]]

       The Conference substitute adopts the House provision. The 
     Managers note that producers who have certified planted 
     acreage under the 1990 farm bill shall be eligible to 
     participate in the market transition program. (Section 
     111(d)).
       The Managers recognize that USDA has been establishing crop 
     acreage bases (CAB) and program payment yields for each 
     contract commodity that participated in the Acreage Reduction 
     Programs and also any contract commodity that was reported to 
     the county FSA offices as planted, or was reported as 
     conserving use acres, or zero acreage planting protection 
     either to maintain or build CAB's. These CAB's and yields 
     were established in accordance with provisions of Title V of 
     the Agricultural Act of 1949. The Managers intend that these 
     CAB's become known as ``contract acreage'' and any farm 
     having contract acreage for at least one crop would be 
     eligible to enroll to receive benefits under a Production 
     Flexibility Contract. It is the intent of the Managers that 
     any farm for which a 1996 CAB would have been established 
     under Title V of the Agricultural Act of 1949 would be 
     eligible to enter into a Production Flexibility Contract. A 
     one-time sign-up period would allow producers to decide 
     whether to enroll all or a portion of the contract acreage 
     for each crop. Except for CRP contracts that expire after the 
     fiscal year 1996 sign-up period, producers should not have a 
     later opportunity to participate in the program. The Managers 
     also adopted an amendment allowing an owner or producer to 
     enroll all or a portion of the eligible cropland of a farm 
     and to subsequently reduce the size of the contract acreage. 
     (Section 111(e) and(f))
     (8) Elements of contracting
       The House bill, in Section 103(b), in paragraph (1), 
     provides that the deadline for entering into a contract is 
     April 15, 1996, except that owners and operators on farms 
     which contain acreage enrolled in the Conservation Reserve 
     Program (``CRP'') may enter into a contract upon the 
     expiration of the CRP contract.
       The Senate amendment is identical
       The Conference substitute adopts the House provision with a 
     technical amendment directing the Secretary to commence sign-
     up, to the maximum extent practicable, no later than 45 days 
     after enactment and shall end sign-up not later than August 
     1, 1996. (Section 112(a))
       It is the intent of the Managers that lands subject to a 
     CRP contract that expires or is voluntarily terminated after 
     August 1, 1996, and that has an eligible farm program base 
     history, should be eligible to enter into an Agriculture 
     Market Transition contract after that date. A producer who 
     voluntarily terminates a CRP contract should have the option 
     to receive either a prorated CRP payment or a contract 
     payment.
     (9) Duration of contract
       The House bill, in Section 103(b), in paragraph (2), 
     provides that the contracts shall begin with the 1996 crop 
     year and extend through the 2002 crop year.
       The Senate amendment is identical.
       The Conference substitute adopts the Senate provision with 
     an amendment allowing a contract to be terminated earlier by 
     a producer or owner. (Section 112(b))
     (10) Estimation of contract payments
       The House bill, in Section 103(b), in paragraph (3), 
     provides that, at the time a contract is signed, the 
     Secretary shall estimate the anticipated payments that will 
     be made under the contract for at least the first fiscal 
     year.
       The Senate amendment is identical.
       The Conference substitute adopts the House provision. 
     (Section 112(c))
     (11) Time For payment; in general
       The House bill, in Section 103(d) establishes the payment 
     dates under the contracts as September 30 of each of the 
     fiscal years 1996 through 2002.
       The Senate amendment is identical.
       The Conference substitute adopts the Senate provision. 
     (Section 112(d))
     (12) Advance payments
       The House bill provides that an owner or operator may opt 
     to receive half of each annual payment on December 15 of each 
     year. For the 1996 fiscal year, an owner or operator may 
     elect to receive half of the payment not later than June 15.
       The Senate amendment is identical.
       The Conference substitute adopts the House provision with 
     an amendment allowing a producer, in fiscal year 1996, to opt 
     to receive a 50 percent advance payment 30 days after the 
     contract is entered into and approved. For the remaining 
     fiscal years, a producer can opt to receive a 50 percent 
     advance payment on December 15 or January 15. The date of 
     this election can be modified in subsequent fiscal years at 
     the option of the producer. (Section 112(d))
     (13) Fiscal year amounts
       The House bill, in Section 103(e), in paragraph (1), 
     establishes spending limits of:
       (A) $5,570,000,000 for FY 1996;
       (B) $5,385,000,000 for FY 1997;
       (C) $5,800,000,000 for FY 1998;
       (D) $5,603,000,000 for FY 1999;
       (E) $5,130,000,000 for FY 2000;
       (F) $4,130,000,000 for FY 2001; and
       (G) $4,008,000,000 for FY 2002.
       The Senate amendment is identical.
       The Conference substitute adopts the Senate provision. 
     (Section 113(a))
       The Managers intend that USDA, to the maximum extent 
     practicable, expend the amounts specified by this section in 
     each fiscal year. Final payment rates for each crop should be 
     calculated based on the amount of all contract production 
     enrolled by all producers for that crop for the fiscal year. 
     Any unexpended amounts in a fiscal year should be added to 
     the amount available for contract payments in the next 
     succeeding fiscal year as specified under section 113(a), 
     except unexpended funds attributable to the application of 
     the payment limitation provisions.
     (14) Allocation (commodity)
       The House bill, in Section 103(e), in paragraph (2), 
     allocates the yearly amounts among the contract commodities 
     as follows:
       (A) wheat, 26.26 percent;
       (B) corn, 46.22 percent;
       (C) grain sorghum, 5.11 percent;
       (D) barley, 2.16 percent;
       (E) oats, 0.15 percent;
       (F) upland cotton, 11.63 percent; and
       (G) rice, 8.47 percent.
       The Senate amendment is identical.
       The Conference substitute adopts the Senate provision. 
     (Section 112(b))
     (15) Adjustment
       The House bill, in Section 103(e), in paragraph (3), 
     directs the Secretary to adjust the amounts allocated in 
     paragraph (2), if necessary, by:
       (A) adding producer repayments of deficiency payments 
     received during that fiscal year under section 114(a)(2) of 
     the Agricultural Act of 1949;
       (B) adding contract payments withheld at the request of 
     producers, during the preceding fiscal year as an offset 
     against repayments of deficiency payments otherwise required 
     under section 114(a)(2) of the Agricultural Act of 1949; and
       (C) adding contract payments which are refunded during the 
     preceding fiscal year under section 103(h) for the commodity; 
     and
       (D) subtracting payments required under sections 103B, 
     105B, and 107B of the Agricultural Act of 1949 for the 199 
     and 1995 crop years.
       The Senate amendment, in Section 103(e), in paragraph (3), 
     directs the Secretary to adjust the amounts allocated in 
     paragraph (2), if necessary, by:
       (A) subtracting payments (final deficiency payments) 
     required under sections 103B, 105B, and 107B of the 
     Agricultural Act of 1949 for the 1994 and 1995 crop years;
       (B) adding any required producer repayments of deficiency 
     payments received during that fiscal year under section 
     114(a)(2) of the Agricultural Act of 1949;
       (C) adding contract payments withheld at the request of 
     producers, during the preceding fiscal year as an offset 
     against repayments of deficiency payments otherwise required 
     under section 114(a)(2) of the Agricultural Act of 1949; and
       (D) adding contract payments which are refunded during the 
     preceding fiscal year under section 103(h) for the commodity.
       The Conference substitute adopts the House provision with 
     an amendment directing the Secretary to adjust the amounts 
     allocated for each contract commodity under subsection (b) in 
     a particular fiscal year by:
       (1) adding all repayment of deficiency payments required 
     under section 114(a)(2) of the Agriculture Act of 1949;
       (2) adding all contract payment refunds received the 
     previous year under section 116; and
       (3) subtracting payments made during that fiscal year under 
     sections 103B, 105B, or 107B of the Agricultural Act of 1949 
     for the 1994 and 1995 crop years. (Section 113(c))
     (16) Additional rice allocation
       The House bill, in Section 103(e), in paragraph (4), 
     requires the Secretary to determine the amount necessary to 
     make the remaining payments under section 101B of the 
     Agriculture Act of 1949 for the 1994 and 1995 crops of rice. 
     The Secretary is directed to subtract this amount, in equal 
     installments, from the amount in paragraph (2)(G) available 
     for rice.
       The Senate amendment, in Section 103(e), in paragraph (3), 
     directs the Secretary to increase the amount available for 
     rice in paragraphs (1), (2) and (3), by $17,000,000 for each 
     of fiscal years 1997 through 2002.
       The Conference substitute adopts the Senate provision with 
     an amendment reducing the amount to $8,500,000 for each of 
     fiscal years 1997 through 2002. (Section 113(d))
       The Managers adopted an amendment to ensure that the total 
     amounts available for contract payments shall be reduced by 
     the total amount of payments foregone due to payment 
     limitations, and that the portion of a contract payment that 
     is attributed to repayment of advance deficiency payments for 
     the 1994 and 1995 crop years does not apply to the payment 
     limitation for subsequent years. However, such payment should 
     not exceed $50,000. (Section 113 (e) and (f))
     (17) Determination of contract payments
       The House bill, in Section 103(f) provides the method for 
     determining payments under a particular contract:
     Paragraph (1) establishes the process for determining the 
     payment quantity of a contract commodity, which is the 
     product of 85 percent of the contract acreage and the farm 
     program payment yield for the commodity.
        The Senate amendment contains an identical provision.
        The Conference substitute adopts the House provision. 
     (Section 114 (a))
     (18) Annual Payment quantity of contract commodities
       The House bill, in Paragraph (2) provides that the payment 
     quantity of each contract

[[Page H2799]]

     commodity covered by all contracts for each fiscal year shall 
     equal the sum of all the payment quantities under paragraph 
     (1).
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the Senate provision. 
     (Section 114(b))
     (19) Annual payment rate
       The House bill, in Paragraph (3) provides that the annual 
     payment rate for a contract commodity shall be the amount 
     made available under 103(e) for the commodity divided by the 
     total payment quantity under paragraph (2).
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision. 
     (Section 114(c))
     (20) Annual payment amount
       The House bill, in Paragraph (4) provides that the payment 
     amount to be paid under a contract shall be equal to the 
     product of the payment quantity determined under paragraph 
     (1) and the payment rate determined under paragraph (3).
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that the annual payment amount is the sum of 
     payments for all contract commodities and that contract 
     payments shall be reduced by an amount equal to any required 
     repayment of advance deficiency payments under section 
     114(a)(2) of the Agriculture Act of 1949.
       The Managers adopted an amendment to direct the Secretary 
     to collect repayments as soon as contract payments are 
     determined. (Section 114(d) and (e))
     (21) Assignment of contract payments
       The House bill, in Paragraph (5) provides that the 
     provisions of section 8(g) of the Soil Conservation and 
     Domestic Allotment Act relating to assignment of payments 
     shall apply to contract payments, and requires that the 
     owner, operator, or assignee to notify the Secretary of such 
     assignment.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision with a 
     technical amendment. (Section 114(f))
     (22) Sharing of contract payments
       The House bill, in Paragraph (6) directs the Secretary to 
     allow for the sharing of payments among owners and operators 
     in a fair and equitable manner.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the Senate provision with 
     a technical amendment.
       The Managers intend that the Production Flexibility 
     Contracts ensure a fixed payment based on section 113 and 114 
     for seven years. The contracts are farm specific and apply to 
     that farm for the seven-year term of the contract. However, 
     it is the intent of the Managers that the division of 
     payments and the producers on a contract could change each 
     year to reflect the producers on the farm for that year. 
     Changes in producers on a farm could result from changes in 
     rental agreements, ownership, or other changes to a farming 
     operation. The purpose of this program is to transition 
     producers who have been earning deficiency payments from 
     government-driven planting decisions to market-driven 
     planting decisions. The Managers intend that USDA administer 
     this program to generally ensure consistency with current 
     regulations relating to the division of payments and fair 
     treatment of tenants and landowners. Past payment history on 
     a farm should also be considered when determining eligible 
     producers and payment divisions. Owners who follow State 
     tenancy laws and timely notify tenants should have the 
     ability to change renters and rental arrangements and change 
     Production Flexibility Contracts to reflect those changes. 
     (Section 114(g))
     (23) Payment limitation, applicability
       The House bill, in Section 103(g) provides that the total 
     amount of payments under a contract during any fiscal year 
     may not exceed the payment limitation established under 
     sections 1001 through 1001C of the Food Security Act of 1985.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision. 
     (Section 115)
     (24) Payment limitation
       The House bill, in Section 105(a) amends section 1001 of 
     the Food Security Act of 1985 to provide that the total 
     amount of contract payments to a person under section 103 of 
     this Act may not exceed $40,000 during any fiscal year, and 
     that the total amount of marketing loan gains or loan 
     deficiency payments to a person under section 104 of this Act 
     may not exceed $75,000.
       Section 105(b) makes necessary conforming changes to the 
     Food Security Act of 1985 and the Agricultural Reconciliation 
     Act of 1987.
       The Senate amendment, in Section 105, contains a similar 
     provision but for technical differences.
       The Conference substitute adopts the House provision with a 
     technical amendment. (Section 115(b))
     (25) Violations of contract
       The House bill, in Section 103(h), in paragraph (1), 
     authorizes the Secretary to terminate a contract if an owner 
     or operator violates the farm's conservation compliance plan, 
     wetland protection requirements, planting flexibility 
     provisions, or agricultural use restrictions. Upon 
     termination, the owner or operator forfeits future payments 
     and must refund payments received during the period of the 
     violation, with interest as determined by the Secretary.
       Section 103(h), in paragraph (2), provides that, if the 
     Secretary determines that the nature of the violation does 
     not warrant termination of the contract as provided in 
     paragraph (1), the Secretary may--
       (A) require a partial refund with interest; or
       (B) adjust future contract payments.
       The Senate amendment, in Section 103(h), contains an 
     identical provision but for technical differences.
       The Conference substitute adopts the House provision. 
     (Section 116)
     (26) Foreclosure (effect of violation)
       The House bill, in Section 103(h), in paragraph (3), 
     prohibits the Secretary from requiring repayments from an 
     owner or operator if farmland which is subject to the 
     contract is foreclosed upon and the Secretary determines that 
     forgiving such repayments is appropriate in order to provide 
     fair and equitable treatment. This authority does not void 
     the responsibilities of such owner or operator if the owner 
     or operator continues or resumes control or operation of the 
     property subject to the contract, and in effect reinstate the 
     contract.
       Section 103(h), in paragraph (4), provides that a 
     determination by the Secretary under this subsection shall be 
     considered as an adverse decision for purposes of 
     administrative review.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the Senate provision. 
     (Section 116(c))
     (27) Transfer of interest in lands subject to contract
       The House bill, in Section 103(i), in paragraph (1), 
     provides for transfers of land subject to a contract. The 
     Secretary is to carry out this paragraph in such a manner to 
     ensure that the reconstitution of a farm in association with 
     a transfer results in no additional outlays. Upon a transfer, 
     a contract is automatically terminated unless the transferee 
     agrees to assume all obligations under the contract. A 
     transferee may request modifications to a contract before 
     assuming it, if the modifications are consistent with the 
     objectives of this section as determined by the Secretary.
       Section 103(i), in paragraph (2), authorizes the Secretary 
     to issue regulations regarding contract payments in instances 
     in which an owner or operator dies, becomes incompetent, or 
     is otherwise unable to receive a contract payment.
       The Senate amendment contains a similar provision.
       The Conference substitute adopts the House provision with a 
     technical amendment. (Section 117)
     (28) Planting flexibility; permitted crops
       The House bill, in Section 103(j), in paragraph (1) 
     provides that, subject to the restrictions in paragraph 
     (2)(A), any commodity or crop may be planted on contract 
     acreage.
       The Senate amendment, in Section 103(j), contains a similar 
     provision.
       The Conference substitute adopts the Senate provision. 
     (Section 118)
     (29) Haying and grazing
       In the House bill, Subparagraph (A) allows unlimited haying 
     and grazing on 15% of contract acreage, and unlimited haying 
     and grazing of contract acreage planted to a contract 
     commodity during the crop year.
       Subparagraph (A) also provides that haying and grazing of 
     contract acreage shall be permitted, except during the 5-
     month period designated by the State Committee established 
     under section 8(b) of the Soil Conservation and Domestic 
     Allotment Act between April 1 and October 31st of each year. 
     The Secretary may permit unlimited haying and grazing on 
     eligible farmland in cases of a natural disaster.
        The Senate amendment contains a similar provision but for 
     technical differences.
       The Conference substitute adopts the House provision with 
     an amendment to strike the provision. It is the intent of the 
     Managers that the haying and grazing of any commodity or crop 
     should be allowed on contract acreage without restriction, 
     and without a reduction in contract payments.
     (30) Alfalfa
       The House bill, in subparagraph (B) provides that the 
     planting and harvesting of alfalfa on contract acreage shall 
     be unlimited, except that the quantity of acreage eligible 
     for a contract payment shall be reduced proportionately for 
     each acre beyond 15 percent on which alfalfa is planted and 
     harvested.
       The Senate amendment contains a similar provision but for 
     technical differences.
       The Conference substitute adopts the Senate provision with 
     an amendment to strike the provision.
     (31) Fruits and vegetables
       In the House bill, Paragraph (2) prohibits the planting of 
     fruits and vegetables on contract acreage, except in any 
     region with a history of double cropping, as determined by 
     the Secretary. This restriction does not apply to contract 
     commodities, lentils, mung beans, and dry peas.
       The Senate amendment, contains a similar provision except 
     that the planting of fruits and vegetables is allowed only on 
     a farm with a history of double cropping.
       The Conference substitute adopts the House provision with 
     an amendment:
       Subparagraph (A): the double-cropping of fruits or 
     vegetables in association with a

[[Page H2800]]

     contract commodity on contract acres is allowed in any region 
     with a history of such practice, as determined by the 
     Secretary, regardless of the planting history of an 
     individual farm;
       Subparagraph (B): a fruit or vegetable can be grown without 
     limitation on any farm with a history of fruit or vegetable 
     production on contract acres, except that a contract payment 
     shall be reduced by one acre for each contract acre planted 
     to a fruit or vegetable in that year; and,
       Subparagraph (C): a producer with a history of production 
     of a specific fruit or vegetable, as determined by the 
     Secretary, is allowed to rent or lease contract acres to grow 
     that fruit or vegetable, on any farm, without respect to the 
     planting history of the individual farm. The number of acres 
     so leased or rented cannot exceed the average acres rented or 
     leased by that producer in crop years 1991-1995. Years of no 
     production are not included in the average, and for each 
     contract acre so rented or leased, the contract payment shall 
     be reduced by one acre. (Section 118)
       The Managers intend for the Secretary to administer the 
     exceptions to the fruits and vegetable planting prohibitions 
     as three distinctly separate situations. With respect to 
     subparagraphs (A), (B), and (C), any perceived limitation in 
     one subparagraph should not limit flexibility in any other 
     subparagraph. (Section 118)


Subtitle C--Nonrecourse Marketing Assistance Loans and Loan Deficiency 
                                Payments

     (32) Nonrecourse marketing assistance loans and loan 
         deficiency payments
       The House bill, in Section 104(a), in paragraph (1), 
     directs the Secretary to make nonrecourse marketing 
     assistance loans available to eligible producers of loan 
     commodities for each of the 1996 through 2002 crops of such 
     commodities under terms and conditions prescribed by the 
     Secretary at rates established under section 104(b).
       Section 104(a), in paragraph (2), provides that the amount 
     of production eligible for a marketing assistance loan 
     includes all production of a loan commodity produced by a 
     producer who has entered into a contract, and any production 
     of extra long staple cotton or oilseeds.
       Section 104(a), in paragraph (3), establishes recourse 
     loans for high moisture feed grains. Eligibility shall be 
     limited to the product of the harvested acreage of high 
     moisture feed grains and the lower of the payment yield or 
     actual yield on a field.
       Section 104(b), in paragraph (1), provides that the loan 
     rate for wheat is not less than 85 percent of the 5-year 
     Olympic average, with a maximum of $2.58 per bushel, and the 
     Secretary has authority to further decrease the loan rate in 
     a particular year based on stocks-to-use ratios.
       Section 104(b), in paragraph (2), provides that the loan 
     rate for corn is not less than 85 percent of the 5-year 
     Olympic average, with a maximum of $1.89 per bushel, and the 
     Secretary has authority to further reduce the loan rate in a 
     particular year based on stocks-to-use ratios. Loan rates for 
     other feed grains are to be set at rates which are fair and 
     reasonable in relation to the rate for corn.
       Section 104(b), in paragraph (3), provides that the loan 
     rate for upland cotton shall be not less than the smaller of:
       (i) 85 percent of the average U.S. spot market price during 
     the preceding 5 marketing years, excluding the highest and 
     lowest-price years, or
       (ii) 90 percent of the average price of the 5 lowest priced 
     growths quoted for Northern Europe during a specified period, 
     adjusted downward to account for differences between the 
     Northern Europe and U.S. spot market prices.
       However, in any case, the loan rate shall not be less than 
     $0.50 per pound nor more than $0.5192 per pound.
       Section 104(b), in paragraph (4), provides that the loan 
     rate for extra long staple cotton shall be not less than 85 
     percent of the 5-year Olympic average, with a maximum of 
     $0.7965 per pound.
       Section 104(b), in paragraph (5), provides that the loan 
     rate for rice shall be $6.50 per hundredweight.
       Section 104(c) provides that the term of a loan shall be 
     nine months, except that a loan for upland or extra long 
     staple cotton shall be ten months, starting on the first day 
     of the first month after the month in which the loan is made. 
     The Secretary may not extend loans.
       The Senate amendment contains an identical provision, but 
     did not establish non-recourse loans for high-moisture 
     feedgrains.
       The Conference substitute adopts the House position with a 
     technical amendment to the reference period used to establish 
     cotton loan levels. The Managers intend that no change in 
     cotton loan rates shall result from this technical change. 
     The Managers adopted a technical amendment limiting upland 
     cotton loans to a ten month period and specifying that only 
     contract commodities produced on a contract farm are eligible 
     for a marketing or non-recourse loan. The Managers adopted an 
     amendment directing the Secretary to carry out this subtitle 
     in a manner to ensure that no additional outlays result from 
     the reconstitution of farms. (Section 131, 132 and 133)
       The Managers also agreed to establish a recourse loan 
     program for high-moisture feedgrains and seed cotton. 
     (Section 137)
       The Managers understand that the Secretary currently has 
     authority to make a recourse loan available to producer on 
     seed cotton (cotton which has been harvested but not ginned). 
     This provision simply extends current law. The regulations 
     governing the recourse seed cotton loan establish very strict 
     repayment requirements. Since the loan must be repaid in a 
     timely manner and repayment virtually always, with the 
     exception of cotton harvested in the early production areas 
     of the Lower Rio Grande Valley, occurs in the same fiscal 
     year there should be minimal if any cost associated with 
     extending this authority.
     (33) Oilseeds
       The House bill, in Section 104(b), in paragraph (6), 
     provides that the loan rate for oilseeds: soybeans are $4.92 
     per bushel, sunflower seed, canola, rapeseed, safflower, 
     mustard seed, and flaxseed are $0.087 per pound; and other 
     oilseeds are set a level that is fair and reasonable in 
     relation to the loan rate available for soybeans (not to 
     exceed other oilseeds).
       The Senate amendment, in Section 104(b), in paragraph (6), 
     provides that the loan rate for oilseeds shall be not less 
     than 85 percent of the 5-year Olympic average market price. 
     The soybean minimum loan is $4.92 per bushel and the maximum 
     is $5.26 per bushel; the minimum loan for sunflower seed, 
     canola, rapeseed, safflower, mustard seed, and flaxseed is 
     $0.087 per pound and the maximum is $0.93 per pound; and 
     other oilseeds are set a level that is fair and reasonable in 
     relation to the loan rate available for soybeans (not to 
     exceed other oilseeds).
       The Conference substitute adopts the Senate provision. 
     (Section 132 (f))
     (34) Repayment of loans
       The House bill, in Section 104(d) establishes repayment 
     provisions for loan commodities at the lesser of:
       (A) the loan rate; or
       (B) the prevailing world market price (adjusted to U.S. 
     quality and location).
       Paragraph (2) sets additional repayment rates for wheat, 
     feedgrains and oilseeds at the level that will:
       (A) minimize potential loan forfeitures;
       (B) minimize the accumulation of stocks of the commodities 
     by the Federal Government;
       (C) minimize the cost incurred by the Federal Government in 
     storing the commodities; and
       (D) allow the commodities produced in the United States to 
     be marketed freely and competitively, both domestically and 
     internationally.
       Paragraph (3) sets the repayment rate for extra long staple 
     cotton at the loan rate plus interest.
       Paragraph (4) instructs the Secretary to prescribe by 
     regulation a formula to determine the prevailing world market 
     price and a mechanism to periodically announce the prevailing 
     world market price.
       Paragraph (5) provides upland cotton prevailing world 
     market price adjustment authority based on the Northern 
     Europe price differential, with further adjustment authority 
     based on the U.S. export share, current cotton exports and 
     sales, and other data determined by the Secretary to be 
     relevant. Such adjustments may not exceed the difference 
     between the average U.S. price and the Northern Europe price.
       Section 104(e) directs the Secretary to make loan 
     deficiency payments to producers who forego obtaining a loan 
     under subsection (a) in an amount equal to the difference 
     between the loan rate for a commodity and the level at which 
     it may be repaid. However, there is no authority for loan 
     deficiency payments for extra long staple cotton.
       Section 104(f) provides special marketing loan provisions 
     for upland cotton.
       Paragraph (1) extends the first handler marketing 
     certificate provisions through July 31, 2003, under which 
     certificates (which may be redeemed for CCC-owned 
     commodities) or cash payments must be made available to first 
     handlers of cotton whenever the prevailing market price 
     (adjusted for U.S. quality and location) is below the current 
     loan repayment rate. The values of the certificates (or the 
     amount of the payment) is based on the difference between the 
     adjusted world price and the loan repayment level.
       The Senate amendment contains a similar provision but for 
     technical differences.
       The Conference substitute adopts the House position with an 
     amendment directing the Secretary to set the repayment rate 
     for wheat, feedgrains and oilseeds at the lesser of the loan 
     rate plus interest or the rate that the Secretary determines 
     will minimize forfeitures, accumulation of stocks, cost to 
     the government and that will allow the commodity to marketed 
     freely and competitively, both domestically and 
     internationally. The repayment rate for cotton and rice shall 
     be the lesser of the loan rate pus interest or the prevailing 
     world market price and the repayment rate for extra-long 
     staple cotton shall be the loan rate plus interest. (Sections 
     134 and 135)
       To continue to achieve the objectives of minimizing 
     forfeitures, the accumulation of stocks, and government costs 
     while promoting competitive marketing in domestic and 
     international markets, the Managers expect the Secretary to 
     extend the provisions of current regulations governing entry 
     into the marketing assistance loan and establishment of the 
     repayment rate for the marketing assistance loan. The 
     Managers recognize that the regulations vary by commodity and 
     expect the Secretary to continue to establish regulations 
     which reflect differences in normal commercial practices for 
     the affected

[[Page H2801]]

     commodity. In particular, the Managers expect the Secretary 
     to continue to establish the prevailing world price for 
     upland cotton in the same manner utilized for the 1991 
     through 1995 crops.
     (35) Step 2
       The House bill, in Paragraph (1) extends the cotton user 
     marketing certificate provisions (commonly known as ``Step 
     2'' provisions), which requires the Secretary to make 
     payments, either in cash or marketing certificates, to 
     domestic users and exporters for documented purchases 
     whenever (i) the weekly U.S. Northern Europe price exceeds 
     the Northern Europe price by more than 1.25 cents per pound 
     for a consecutive four-week period; and (ii) the adjusted 
     world market price does not exceed 130 percent of the loan 
     rate. However, no payments will be issued if, for the 
     preceding consecutive 10-week period, the weekly U.S. 
     Northern Europe price, adjusted for the value of any 
     certificates or payments issued, exceeds the Northern Europe 
     price by more than 1.25 cents per pound. The value of the 
     certificates (or the amount of the payments) is the 
     difference between the two prices, minus 1.25 cents, per 
     pound. Payments under this paragraph may not exceed 
     $701,000,000 between fiscal years 1996 through 2002.
       Paragraph (2) extends special import quota provisions 
     (commonly known as ``Step 3'') which requires that a special 
     import quota be opened if, for a consecutive 10-week period, 
     the U.S. Northern Europe price, adjusted for the value of any 
     payments issued under Step 2, exceeds the Northern Europe 
     price by more than 1.25 cents per pound. The amount of the 
     quota is equal to 1 week's domestic mill consumption. 
     Importers have 90 days to purchase and 180 days to enter the 
     cotton into the U.S. after the quota is announced, and quota 
     periods can overlap.
       Section 104(g) extends the limited global import quota 
     provisions, which direct the President to carry out an upland 
     cotton import quota program whenever the Secretary determines 
     and announces that the average price in designated U.S. spot 
     markets for a month, as determined by the Secretary, exceeded 
     130 percent of such average price for the last 36 months. The 
     quantity of this import quota is equal to 21 days of domestic 
     mill consumption, but this quota cannot overlap with any 
     quota announced under section 104(f).
       The Senate amendment is identical but for technical 
     differences.
       The Conference substitute adopts the Senate provision with 
     technical amendments. (Section 136)
       The Managers are aware that while the cotton marketing 
     certificates have contributed to the goal of maintaining the 
     competitive position of U.S. cotton in domestic and 
     international markets, there has been concern about the 
     adverse implications associated with the so-called 
     ``bunching'' of export sales registrations. The Managers 
     expect and urge the Secretary to issue a regulation which 
     will eliminate, to the extent practicable, the so-called 
     ``bunching'' of export sales registrations without 
     significantly disrupting the normal marketing process for 
     upland cotton in domestic and export markets.
       The Managers intend that Secretary should carefully 
     consider issuing regulations such that if the spending 
     limitation on cotton marketing certificates is reached the 
     special import quota provided in paragraph (3) would be 
     established following a consecutive four-week period in which 
     the Friday through Thursday average price quotation for the 
     lowest-priced United States growth, as quoted for Middling 
     (M) one and three-thirty seconds inch cotton, delivered 
     C.I.F. Northern Europe exceeds the Northern Europe price by 
     more than 1.25 cents per pound.


                     Subtitle D--Other Commodities

                            Chapter 1--Dairy

     (36) Milk price support program; recourse loan program for 
         commercial processors of dairy products
       The House bill reauthorizes the milk price support program 
     for five years with several major changes. It requires the 
     Secretary of Agriculture to support the price of milk through 
     the purchase of butter, nonfat dry milk, and cheese in the 48 
     contiguous States from the date of enactment through December 
     31, 2000. (Section 201(a))
       The House bill requires that milk containing 3.67 percent 
     butterfat is supported at $10.15 per hundredweight during 
     calendar year 1996; $10.05 during 1997; $9.95 during 1998; 
     $9.85 during 1999; and $9.75 during 2000. (Section 201(b))
       The House bill continues the current law requirement that 
     dairy product purchase prices (butter, cheese, and nonfat dry 
     milk) announced by the Secretary of Agriculture be the same 
     for all persons offering to sell product to the Secretary. 
     Purchase prices must be sufficient to enable plants of 
     average efficiency to pay producers on average a price that 
     is not less than the rate of support for milk in effect under 
     Section 201(b). (Section 201(c))
       The House bill allows the Secretary of Agriculture to 
     allocate the rate of support between the purchase prices for 
     nonfat dry milk and butter in a manner that will minimize 
     Commodity Credit Corporation expenditures or achieve other 
     objectives as the Secretary considers appropriate. The 
     Secretary is required to notify the House Committee on 
     Agriculture and the Senate Committee on Agriculture, 
     Nutrition and Forestry of the allocation within ten days 
     after it is announced, but the Secretary may not make such 
     adjustments more than twice each calendar year. (Section 
     201(d))
       The House bill requires the Secretary of Agriculture to 
     refund assessments on milk marketings which occurred prior to 
     enactment under Section 204(h)(2) of the Agricultural Act of 
     1949 during calendar year 1995 or 1996, if the producer 
     provides evidence that the producer did not increase 
     marketings in 1995 or 1996 compared to 1994 or 1995, 
     respectively. This subsection shall not apply for a 
     particular calendar year if a producer has already received a 
     refund under Section 204(h) of the Agricultural Act of 1949 
     for the same fiscal year before the date of enactment of this 
     Act. Refunds under this section shall not be considered as 
     price support or payment for purposes of producer violations 
     of conservation compliance or wetlands conservation. (Section 
     201(e))
       The House bill authorizes the Secretary to carry out this 
     program through the Commodity Credit Corporation. (Section 
     201(f))
       The House bill also terminates authority for the price 
     support program on December 31, 2000, notwithstanding Section 
     257 of the Balanced Budget and Emergency Deficit Control Act 
     of 1985. (Section 201(g))
       The Senate amendment retains the current law milk price 
     support program without change. The price support program is 
     authorized through the end of calendar year 1996. Section 
     201(c) of the Agricultural Act of 1949, which requires the 
     Secretary to support the price of milk at not less than 75 
     percent of parity, is applicable thereafter.
        The Conference substitute adopts the House position with 
     two amendments. The first amendment continues a milk price 
     support program through December 31, 1999 at a price support 
     level of $10.35/cwt in 1996, $10.20/cwt in 1997, $10.05/cwt 
     in 1998, and $9.90/cwt in 1999 and exempts the Secretary's 
     actions with respect to changing the allocation for the 
     purchase prices of butter and nonfat dry milk from informal 
     rulemaking procedures. It is also the managers' intent that 
     among the `other objectives' the Secretary should pursue when 
     adjusting the support price between butter and nonfat dry 
     milk is the maximization of exports of butter and nonfat dry 
     milk. (Section 141)
        The second amendment provides for a recourse loan program 
     for butter, nonfat dry milk, and cheese on January 1, 2000 at 
     the 1999 price support level of $9.90/cwt. The Congressional 
     Budget Office estimates that the recourse loan program will 
     cost approximately $10 million in each of fiscal years 2000-
     2002 thereby maintaining a baseline for dairy program 
     expenditures during these fiscal years. It is the intent of 
     the managers that a budget baseline be maintained for dairy 
     commodity program outlays in addition to the Dairy Export 
     Incentive Program (DEIP) outlays. (Section 142)
     (37) Consolidation and reform of Federal milk marketing 
         orders
       The House bill requires the Secretary to amend federal milk 
     marketing orders by consolidating the number of federal 
     orders to between 10 and 14 and to provide for multiple 
     basing points in the pricing of milk (Section 202(a)).
       The House bill requires the required consolidation of milk 
     marketing orders to be announced not later than December 31, 
     1998, and implemented not later than December 31, 2000. The 
     Secretary is also required to use informal rulemaking when 
     consolidating orders (Section 202(b)).
        The House bill precludes the Secretary from the use of any 
     funds to administer more than 14 federal milk marketing 
     orders beginning January 1, 2001 (Section 202(c)).
       The House bill requires the Secretary to submit to Congress 
     a report that reviews the federal milk marketing order 
     system, in light of the reforms required by subsection (a), 
     and provide recommendations for further improvements and 
     reforms to the federal milk marketing order system. The 
     report must be submitted not later than January 1, 1998. 
     (Section 202(d))
        The Senate amendment retains current law.
        The Conference substitute adopts the House provision with 
     the following amendments. It requires that the Secretary 
     consolidate the number federal milk marketing orders to not 
     less than 10 and not more than 14 orders. In the process of 
     consolidating orders, the Secretary is authorized to use 
     multiple basing points and utilization rates in pricing fluid 
     milk and to use uniform multiple component pricing when 
     developing a new basic formula price(s) for manufacturing 
     milk. There is no limitation on the number of issues the 
     Secretary may consider when consolidating orders. The 
     Conference substitute requires the Secretary to propose 
     consolidation and pricing reform of milk marketing orders 
     within two years of enactment of this Act, and to implement 
     consolidation and pricing reform within 3 years of enactment 
     of this Act. The Secretary is authorized to use informal 
     rulemaking to address order consolidation and pricing reform, 
     and any issues peripheral to the consolidation process.
        The Conference substitute also provides that Section 131 
     of the Food Security Act of 1985 shall not be considered to 
     affect the consolidation and pricing reform that will occur 
     under this Act. The mere fact that the minimum price for 
     Class I (fluid) milk in an order consolidated under this 
     section is the same or substantially similar to a minimum 
     Class I milk price for a predecessor order(s) listed in the 
     table from Section 131 of the Food Security Act of 1985 shall 
     neither raise a presumption, nor be conclusive, on the issue 
     of

[[Page H2802]]

     whether the Secretary considered, or made the basis of his 
     decision, the table in Section 131 of the Food Security Act 
     of 1985.
        The Conference substitute further provides that the 
     Federal milk marketing orders shall, upon the petition and 
     approval by California dairy producers, cover the State of 
     California, in which case that order shall have the right to 
     re-blend and distribute order receipts to recognize quota 
     value. The Managers do not intend in any way to amend, or 
     create an exception for California from the requirements of, 
     federal law (for federal milk marketing orders) regarding 
     producer-handlers.
        The Substitute provides that if USDA does not complete 
     consolidation of orders by the end of three years after 
     enactment of this Act, the Department of Agriculture loses 
     authority to assess producers and handlers for market order 
     services and order administration until such consolidation is 
     completed. However, the length of time during which any 
     injunction is applicable against the Department with respect 
     to the consolidation shall be added to the time in which the 
     Department has to complete the consolidation under Subsection 
     (a) paragraph (1). (Section 143)
     (38) Effect on fluid milk standards in the State of 
         California
        The House bill provides that nothing in this Act or any 
     other provision of law shall preempt, prohibit, or otherwise 
     limit the authority of the State of California from 
     establishing or continuing any law, regulation, or 
     requirement regarding (1) the percentage of milk solids or 
     solids not fat in fluid milk products sold at retail or 
     marketed in the State of California; or (2) the labeling of 
     such fluid milk products with regard to milk solids or solids 
     not fat. (Section 204)
        The Senate amendment has no provision.
        The Conference substitute adopts the House provision. The 
     conference-adopted bill provides the State of California an 
     exemption from the preemption provisions of any Federal law 
     respecting standards of identity and labeling for fluid milk.
        The State of California has had a system for requiring 
     fortified fluid milk since the early 1960's. These fluid milk 
     standards were adopted by the State legislature and any 
     revision of these standards must be approved by the state 
     legislature. These standards apply to all fluid milk sold at 
     retail or marketed in the State of California.
        The Managers intend for the State of California to be able 
     to fully enforce and apply its fluid milk standards and their 
     attendant labeling requirements to all fluid milk sold at 
     retail or marketed in the State of California. For purposes 
     of this section, the managers intend ``fluid milk'' means 
     milk in final packaged form for beverage use. (Section 144)
     (39) Milk manufacturing marketing adjustment
        The House bill repeals Section 102 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990, which 
     forbids any State from allowing a manufacturing allowance 
     greater than the amount allowed under federal law. (Section 
     205)
       The Senate amendment retains current law.
       The Conference substitute adopts the House provision with 
     an amendment that repeals Section 102 and sets interim 
     ceilings for state make allowances of $1.80 for cheese and 
     $1.65 for butter/powder through December 31, 1999. (Section 
     145)
     (40) Promotion; Northeast Interstate Dairy Compact
       The House bill states that an additional purpose of the 
     fluid milk promotion program is to promote and expand markets 
     for fluid milk, and not to restrict or otherwise discourage 
     individual promotion or advertising of fluid milk products. 
     (Section 206(a))
       The House bill states that the purpose stated in section 
     206(a) is Congressional policy (Section 206(b)).
       The House bill expands the activities considered to be 
     research under the Act. (Section 206(c))
       The House bill alters the minimum percentage adoption 
     requirements in any referendum making changes in or 
     terminating the fluid milk promotion order to reflect only 
     those processors actually voting in the referendum. (Section 
     206(d))
       The House bill reauthorizes the fluid milk promotion 
     program through calendar 2002. (Section 206(e))
       The Senate amendment has no provision.
       The Conference substitute adopts the House provision with 
     two amendments. The first amendment makes technical changes 
     in the Fluid Milk Promotion Program. (Section 146)
       The second amendment provides Congressional consent to the 
     Northeast Interstate Dairy Compact as specified in Section 
     1(b) of Senate Joint Resolution 28 of the 104th Congress 
     subject to certain conditions. The Secretary is authorized to 
     grant the New England region the authority to implement the 
     compact, based upon a finding of a compelling public interest 
     in the region. Such authority shall terminate concurrently 
     with the Administration's implementation of the dairy pricing 
     and Federal milk marketing order reform established under 
     section 143 of this Act. (Section 147)
     (41) Dairy export incentive program
       The House bill extends authority for the Dairy Export 
     Incentive Program (DEIP) from December 31, 2001 to December 
     31, 2002. (Section 203(a))
       The House bill gives the Secretary sole discretion to 
     accept or reject bids under such criteria as the Secretary 
     deems appropriate. (Section 203(b))
       The House bill requires the Secretary to maximize the 
     volume of dairy product exports under DEIP consistent with 
     the obligations of the United States as a member of the World 
     Trade Organization (minus the volume sold under Section 1163 
     of the Food Security Act of 1985 during that year), except to 
     the extent that such an export volume exceeds the value 
     limitations on DEIP set forth in Subsection (f). It also 
     authorizes DEIP exports anywhere in the world, except to a 
     destination in a country to which exports from the United 
     States are restricted by law. (Section 203(c))
       The House bill authorizes the Secretary to increase bonus 
     payments by an amount required to assist in the development 
     of world markets. (Section 203(d))
       The House bill requires Commodity Credit Corporation 
     funding for DEIP at the maximum amount consistent with 
     obligations of the United States as a member of the World 
     Trade Organization (minus the amount expended under Section 
     1163 of the Food Security Act of 1985 during that year). 
     However, DEIP funding may not exceed the dairy product export 
     volume limitations specified in Section 203(c). (Section 
     203(e))
       The Senate amendment retains current law for the Dairy 
     Export Incentive Program.
       The Conference substitute adopts the House provision. The 
     Managers intend that only that portion of sales under Section 
     1163 which are subsidized sales should impact, and therefore 
     decrease, the maximum volume and value limitations noted in 
     this section.
       By affording the Secretary of Agriculture the sole 
     discretion to make decisions concerning sales under the DEIP, 
     it is the intent of the Managers to put to rest any 
     interagency disputes over the program. It is the Managers' 
     understanding that the DEIP will use only about 50,000 to 
     60,000 tons of the total nonfat dry milk tonnage of the 
     103,000 tons authorized under the Uruguay Round agreement 
     during this year. It is also the Managers' understanding that 
     during the second through fifth years of implementation of 
     the Uruguay Round agreement, that the United States will be 
     allowed to carry over from year to year unused DEIP tonnage 
     under the cumulation rules set out in Article 9, section 2(b) 
     of the WTO Agreement on Agriculture. The Managers recognize 
     that there is a strong desire upon the part of many that the 
     dairy title have a strong export orientation.
       The Managers instruct the Department along with the Office 
     of the U.S. Trade Representative to carry over all unused 
     DEIP tonnage in the first and all subsequent years of the 
     Uruguay Round agreement in accordance with WTO cumulation 
     rules. (Section 148)
     (42) Authority to assist in establishment and maintenance of 
         one or more export trading companies
       The House bill requires the Secretary to provide the dairy 
     industry assistance to establish and maintain an export 
     trading company or companies. (Section 492)
       The Senate amendment has no comparable provision.
       The Conference substitute adopts the House provision with a 
     technical amendment. (Section 149)
     (43) Standby authority to indicate entity best suited to 
         provide international market development and export 
         services
       The House bill directs the Secretary to indicate which 
     entity or entities are best suited to facilitate the 
     international market development for U.S. dairy products. 
     (Section 493)
       The Senate amendment has no comparable provision.
       The Conference substitute adopts the House provision with a 
     technical amendment. (Section 150)
     (44) Study and report regarding potential impact of Uruguay 
         Round on prices, income and government purchases
       The House bill directs the Secretary to determine the 
     impact on milk prices of additional imports of cheese as a 
     result of the Uruguay Round Agricultural Agreement. (Section 
     494)
       The Senate amendment has no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment that any limitation imposed by Congress 
     regarding studies or reports shall not apply with respect to 
     this section. (Section 151)
     (45) Promotion of United States dairy products in 
         international markets through dairy promotion program
       The House bill requires that no less than 10 percent of the 
     funds available for the Dairy Promotion Program shall be 
     available for development of international markets. (Section 
     495)
       The Senate amendment has no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment that makes expenditures on international market 
     development discretionary. (Section 152)
     (46) Quota Peanuts
       The House bill, in Section 106(a) provides nonrecourse 
     loans to quota peanut producers at $610 per ton, and directs 
     the Secretary to reduce the loan rate by 5 percent to any 
     producer in the current marketing year who had

[[Page H2803]]

     an offer from a handler to purchase quota peanuts at quota 
     support rate or higher but opted to place their peanuts under 
     loan instead.
       The Senate amendment is identical except that it contains 
     no provision directing the Secretary to reduce the loan rate 
     by 5 percent.
       The Conference substitute adopts the House provision, with 
     an amendment in lieu of the 5 percent loan reduction 
     provision, providing that an individual producer who markets 
     his quota peanut crop, meeting quality requirements for 
     domestic edible use, through the marketing association loan 
     for two consecutive marketing years at a time when the 
     Secretary determines a handler provided the producer with a 
     written offer, upon delivery, for at least quota support 
     price, shall become ineligible for quota price support for 
     the next marketing year. The Secretary shall establish the 
     means by which any decision regarding ineligibility for quota 
     price support may be appealed. (Section 155(a))
     (47) Additional peanuts
       The House bill, in Section 106(b) provides nonrecourse 
     loans to producers of additional peanuts at such rates as the 
     Secretary finds appropriate.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision with a 
     technical amendment. (155(b))
     (48) Area marketing Associations
       The House bill, in Section 106(c) directs the Secretary to 
     make price support loans available through area marketing 
     associations via warehouse storage loans, where appropriate, 
     and provides that administrative costs by an area marketing 
     association shall be included in such loans. The Secretary is 
     directed to require area marketing associations to establish 
     and maintain pools for quota peanuts, with separate pools for 
     New Mexico Valencia peanuts, and that net gains from each 
     pool shall be distributed only to producers in the pool.
       The Senate amendment contains a similar provision except 
     that only peanuts physically produced in New Mexico may 
     participate in the New Mexico pool. A New Mexico resident may 
     enter an amount of Valencia peanuts into the New Mexico pool 
     that does not exceed the out-of-state quantity entered in 
     1995.
       The Conference substitute adopts the Senate position with 
     amendment that allows producers who participated in the New 
     Mexico pool with Valencia peanuts grown in Texas during the 
     1990 through 1995 crop years to continue to participate in 
     that pool. However, the quantity of Valencia peanuts grown 
     outside of New Mexico that can be placed in the New Mexico 
     pool is limited to the 1990 through 1995 average of Texas 
     grown Valencia peanuts that a producer placed in the pool. 
     The quantity of Texas produced Valencia peanuts allowed to 
     enter the New Mexico pools, as provided in this subsection, 
     is not transferable. (Section 155(c))
     (49) Losses
       The House bill, in Section 106(d) provides that losses in 
     quota pools shall be covered using the following sources in 
     the following order of priority:
       (1) gains on transfers of peanuts from additional loan 
     pools;
       (2) individual producer gains from domestic and export 
     edible use sales of additional peanuts from additional pools;
       (3) gains from the sale of additional peanuts in an area 
     pursuant to Section 358e (g)(1)(A) of the Agricultural 
     Adjustment Act of 1938 (7 U.S.C. 1359a(g)(1)(A));
       (4) marketing assessment funds collected from growers under 
     subsection (g) (except funds attributable to handlers) with 
     any unused assessment funds being transferred to the 
     Treasury;
       (5) gains or profits from quota pools in other production 
     areas (not including separate type pools established for 
     Valencia peanuts produced in New Mexico); and
       (6) an increase in the marketing assessment for such quota 
     pool.
       The Senate amendment contains a similar provision except 
     that in (3) any profits from additional peanuts sold for 
     domestic edible use shall be used to offset quota losses in 
     that area. In (6), the Senate amendment would assess all 
     quota peanuts in the production area.
       The Conference substitute adopts the Senate provision to 
     use profits from additional peanuts sold for domestic edible 
     use with an amendment that loan redemption profits from farms 
     with one acre or less are exempt. Assessments are to be 
     increased on all quota peanuts, by production area, including 
     those commercially marketed. The Managers intend that the 
     Secretary shall review and consider the marketability of the 
     various types of peanuts prior to announcing differentials 
     for the 1997 and subsequent peanut crops, and to make 
     appropriate adjustments. The sheller budget deficit 
     assessment funds shall be used to offset losses after 
     national cross compliance. (Section 155(d))
     (50) Disapproval of quotas
       The House bill, in Section 106(e) provides that the 
     Secretary may not make loans available for quota peanuts for 
     any crop of quota peanuts for which producers have 
     disapproved the poundage quota.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision. 
     (Section 155(e))
     (51) Quality improvement
       The House bill, in Section 106(f) directs the Secretary to 
     continue to promote quality improvement of peanuts.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision. 
     (Section 155(f))
     (52) Marketing assessment
       The House bill, in Section 106(g) provides that first 
     handlers (initial purchasers of peanuts) and producers pay a 
     marketing assessment to CCC on all peanuts sold equal to 1.2 
     percent of the national average loan rate. Producers shall 
     pay .60 percent in 1996 and .65 percent in 1997 through 2002 
     and first handlers shall pay .55 percent.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision. 
     (Section 155(g))
     (53) Crops
       The House bill, in Section 106(h) provides that subsections 
     (a) through (f) are applicable to the 1996 through 2002 crops 
     of peanuts.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision. 
     (Section 155(h))
     (54) Poundage quotas
       The House bill, in Section 106(i), in paragraph (1), amends 
     the peanut quota provisions contained in part VI of subtitle 
     B of title III of the Agricultural Adjustment Act of 1938 
     (the ``1938 Act'') by extending such provisions through the 
     2002 marketing year.
       Section 106(i), in paragraph (2), amends section 358-
     1(b)(1) of the Act (7 U.S.C. 1358-1(b)(1)) to provide that 
     effective beginning January 1, 1997 the Secretary shall no 
     longer establish farm poundage quota for farms owned or 
     controlled by municipalities, airport authorities, schools, 
     colleges, refuges, and other public entities (not including 
     universities for research purposes); or for farms for which 
     the quota holder is not a producer and resides in another 
     State.
       Section 106(i), in paragraph (3), amends section 358-
     1(a)(1) of the 1938 Act by eliminating the 1,350,000 ton 
     minimum national poundage quota.
       Section 106(i), in paragraph (4), amends section 358-
     1(b)(2) of the 1938 Act by deleting the current subparagraph 
     (B) relating to allocation of increased quota in Texas and 
     inserting a new subparagraph (B) authorizing temporary 
     increases in quota based on seed use. Amended section 358-
     1(b)(2), in subparagraph (B), provides that, for the 1996 
     through 2002 marketing years, a temporary quota allocation 
     for the marketing year only in which the crop is planted, 
     equal to the number of pounds of seed peanuts planted for the 
     farm that shall be made to the producers for the 1996 through 
     2002 marketing years, in addition to the normal farm poundage 
     quota established under section 358-1. Subparagraph (B) also 
     provides that there is no change in the requirement regarding 
     the use of quota and additional peanuts established by 
     section 359a(b) of the 1938 Act. Also, subsection (a)(1) of 
     such section no longer includes ``seed'' in the estimate of 
     domestic edible use by the Secretary.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision with a 
     technical amendment ``to change the effective date of quota 
     eligibility effective beginning with the 1998 crop.'' 
     (Section 155(i))
     (55) Spring and fall transfers of quota
       Section 106(i), in paragraph (5), amends section 358b(a)(1) 
     of the 1938 Act relating to farm poundage quota transfer. 
     Amended section 358b(a)(1) allows farm poundage quota to be 
     sold or leased, either before or after the normal planting 
     season, to any other owner or operator of a farm in the same 
     State. Current provisions requiring 90 percent of a farm's 
     basic quota to be planted or considered planted before a fall 
     (or after the normal planting season) transfer is allowed are 
     maintained.
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment allowing a maximum of 40 percent transfer of 
     quota across county lines, but within a state. Cumulative 
     unexpired transfers outside of a county may not exceed 15 
     percent for the 1996 crop, 25 percent for the 1997 crop, 30 
     percent for the 1998 crop, 35 percent for the 1999 crop and 
     40 percent for the 2000 and subsequent crops. The Conference 
     substitute also allows full lease and sale in fall or spring 
     for counties with less than 100,000 lbs. (50 tons) of quota, 
     and allows unrestricted fall leasing of peanut quota across 
     county lines within a state. (Section 155(i))
     (56) Undermarketings
       Section 106(i), in paragraph (6), eliminates 
     undermarketings by deleting paragraphs (8) and (9) of section 
     358-1(b) of the 1938 Act, with necessary conforming changes 
     to other sections.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision with a 
     technical amendment. (155(i))
     (57) Disaster transfer
       Section 106(i), in paragraph (7), adds a new paragraph (8) 
     to amended section 358-1(b) of the 1938 Act which authorizes 
     the transfer of additional peanuts to a quota loan pool in

[[Page H2804]]

     cases in which quota poundage was not harvested and marketed 
     because of drought, flood, or any other natural disaster, 
     except that the such peanuts shall be supported at 70 percent 
     of the quota support rate, and such transfers shall not 
     exceed 25 percent of the total farm quota pounds.
       The Senate amendment contains a similar provision that such 
     peanuts shall be supported at not more than 70 percent of the 
     quota support rate.
       The Conference substitute adopts the House provision. 
     (Section 155(i))
     (58) Sugar program; sugar cane
       The House bill, in Section 107(a) sets the loan rate for 
     domestically grown sugarcane at 18 cents per pound for raw 
     cane sugar.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision. 
     (Section 156(a))
     (59) Sugar beets
       Section 107(b) sets the loan rate for domestically grown 
     sugar beets at 22.9 cents per pound for refined beet sugar.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the Senate provision. 
     (Section 156(b))
     (60) Reduction in loan rates
       The House bill, in Section 107(c) requires the Secretary to 
     reduce the loan rate specified in subsections (a) and (b) if 
     the Secretary determines that negotiated reductions in export 
     subsidies provided for sugar of the European Union and other 
     major sugar exporting countries in the aggregate exceed the 
     commitments made as part of the Agreement on Agriculture. It 
     also provides that the Secretary shall not reduce the loan 
     rate under subsections (a) and (b) below a rate that provides 
     domestic sugar an equal measure of support to that provided 
     by the European Union and other sugar exporting countries 
     based on the provisions of Agreement on Agriculture, section 
     101(d)(2) of the Uruguay Round Agreements Act.
       The Senate amendment contains no similar provision.
       The Conference substitute adopts the House provision. 
     (Section 156(c))
     (61) Term of loan; loan type; processor assurances
       Section 107(d) provides that loan terms are the earlier of 
     9 months, or the end of a fiscal year, with supplemental loan 
     authority (up to a total on nine months) for loans maturing 
     at the end of a fiscal year.
       The House bill, in Section 107(e) provides for the 
     Secretary to carry out the section through the use of 
     recourse loans for sugar. However, it also provides that 
     during any fiscal year in which the tariff rate quota (TRQ) 
     for imports of sugar into the U.S. is set, or increased to, a 
     level that exceeds 1,500,000 short tons raw value, the 
     Secretary is directed to carry out this section by making 
     nonrecourse loans (previously made recourse loans are to be 
     modified by the Secretary into nonrecourse loans). If the 
     Secretary is required to make nonrecourse loans (or modify 
     recourse loans) under this subsection during a fiscal year, 
     the Secretary is to obtain from processors adequate 
     assurances that such processors will provide appropriate 
     minimum payments to producers as set by the Secretary.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the Senate provision with 
     technical amendments. (Section 156(d) and (e))
     (62) Marketing assessment
       The House bill, in Section 107(f) requires first processors 
     of raw cane sugar to remit to CCC nonrefundable marketing 
     assessment for each pound of raw cane sugar equal to 1.1 
     percent of the loan rate for fiscal year 1996 (1.375 percent 
     for 1997 through 2003) while first processors of sugar beets 
     are to remit to CCC a marketing assessment of 1.1794 percent 
     for fiscal year 1996 (1.47425 percent for 1997 through 2003), 
     on all marketings. Assessments are to be collected on a 
     monthly basis, except that any inventory which has not been 
     marketed by September 30 of a fiscal year shall be assessed 
     at that point, except that the latter sugar shall not be 
     assessed later when it is marketed. Any person who fails to 
     remit the assessment is liable for a penalty based on the 
     quantity of the sugar involved in the violation times the 
     applicable loan rate at the time of violation.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision with 
     technical amendments. (Section 155(f))
     (63) Forfeiture penalty
       The House bill, in Section 107(g) provides for an 
     additional penalty (1 cent per pound on cane sugar, pro rata 
     on beet sugar) to be assessed on the forfeiture of any sugar 
     pledged as collateral for a loan.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the Senate provision with 
     technical amendments. (Section 155(g))
     (64) Information reporting
       The House bill, in Section 107(h) requires processors and 
     refiners to report such information to the Secretary as is 
     required in order to administer the program. A penalty 
     applies for failure to report, and the Secretary is required 
     to make monthly reports on pertinent sugar production, 
     imports, distribution, and stock levels.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the Senate provision with 
     technical amendments. (Section 155(h))
     (65) Crops
       The House bill in Section 107(j) states that this 
     subsection shall be effective only for the 1996 through 2002 
     crops of sugar beets and sugarcane.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the House provision with a 
     technical amendment. (Section 155(i))
     (66) Marketing allotments
       The House bill, in Section 107(i) repeals marketing 
     allotments for sugar, contained in Part VII of subtitle B of 
     title III of the 1938 Act.
       The Senate amendment, in Section 109(1) suspends marketing 
     allotment authority.
       The Conference substitute adopts the Senate provision with 
     an amendment to strike the provision.


                       Subtitle E--Administration

      (67) Administration
       The House bill, in Section 108 directs the Secretary to use 
     CCC to carry out this title, and prohibits the Secretary from 
     using any CCC funds for the salaries or expenses of any 
     officer or employee of USDA. It also provides authority to 
     issue necessary regulations, and provides that determinations 
     made by the Secretary under this title are final.
       The Senate amendment is similar but prohibits the use of 
     CCC funds for salaries and expenses of any officer or 
     employee.
       The Conference adopts an amendment to the CCC Charter Act 
     that specifies: (1) CCC no longer has inherent authority to 
     purchase personal property; (2) for fiscal year 1996, CCC 
     spending for equipment or services relating to automated data 
     processing, information technologies, or related items 
     (including telecommunications equipment and computer hardware 
     or software) be limited to not more than $170 million; (3) 
     for fiscal years 1997 through 2002, CCC spending on such 
     items be limited to not more than $275 million; (4) starting 
     in fiscal year 1997, the use of reimbursable agreements with 
     other Federal or State agencies, including agreements for 
     automated data processing or information resource management 
     activities, be limited to an aggregate amount not to exceed 
     the total amount of reimbursable agreements in fiscal year 
     1995; and (5) after date of enactment, CCC submit to Congress 
     on a quarterly basis an itemized report of all expenditures 
     of over $10,000.


                         Reporting Requirements

       After date of enactment, the Managers expect the Assistant 
     Secretary for Administration, or the USDA Chief Information 
     Officer (if one has been placed in that position pursuant to 
     the Information Technology Reform Act of 1996) to provide the 
     House Committee on Agriculture and the Senate Committee on 
     Agriculture, Nutrition and Forestry with quarterly reports on 
     the expenditure of CCC funds under the Charter Act including 
     all expenditures under reimbursable agreements, for 
     administrative, automated data processing, information 
     technology, and telecommunication products, including 
     contracts with vendors for such products or support services. 
     The Managers expect the reports to itemize expenditures in 
     excess of $10,000, including any expenditures for similar 
     products or services that, when aggregated, exceed $10,000. 
     The first quarterly reports should also itemize all 
     expenditures for fiscal year 1996, and each subsequent report 
     should include aggregated expenditures for each category of 
     product or service from the previous report. The Managers 
     direct the Secretary to ensure that all reports are audited 
     by the USDA Chief Financial Officer pursuant to the Financial 
     Managers Integrity Act, the Government Performance and 
     Results Act, and according to CFO Standards and Conventions.


                        Reimbursable Agreements

       The Managers expect the Secretary to incorporate funding 
     for reimbursable agreements within the annual budget proposal 
     beginning in fiscal year 1997. The Secretary should use every 
     means at his disposal to establish line items for 
     reimbursable agreements in future budgets. (Section 161)
     (68) Adjustment of loans
       The House bill, in Section 104(h) provides general 
     authority for the Secretary to use the Commodity Credit 
     Corporation (``CCC'') and other means available to carry out 
     the loans authorized by this section, and directs the 
     Secretary to get adequate processor assurances that producers 
     will get loan program benefits whenever a loan program 
     includes payments to processors.
       Section 104(i) gives the Secretary general authority to 
     make appropriate adjustments in loan levels based on grade, 
     type, quality, location, and other factors.
       Section 104(j) provides that, in general, a producer is not 
     personally liable for any deficiency arising from the sale of 
     collateral securing a nonrecourse loan. However, exceptions 
     are provided for quality or quantity deficiencies, failure to 
     properly care or maintain collateral, or a failure to deliver 
     a commodity. This section also provides that any security 
     interest obtained by CCC in sugarcane or sugarbeets as a 
     result of a security agreement by a processor shall be 
     superior to all common law and statutory liens in favor of 
     producers.

[[Page H2805]]

       Section 104(k) provides authority for CCC to sell any 
     inventory commodities at any price that the Secretary 
     determines will maximize returns to CCC, except that this 
     authority does not apply to sales:
       (A) for new or byproduct uses;
       (B) of peanuts or oilseeds (if used for oil);
       (C) for seed if the sale will not impair a loan program;
       (D) of deteriorated-quality commodities that are in danger 
     of spoiling;
       (E) for the purpose of establishing a claim arising out of 
     a fraudulent or other wrongful act pursuant to a contract;
       (F) for export; or
       (G) for other than a primary use.
     The Secretary is also authorized to make CCC-owned 
     commodities available in any Presidential disaster area.
       The Senate amendment contains a similar provision but for 
     technical differences.
       The Conference substitute adopts the House position.
       The Managers agreed to include an amendment that allows the 
     Secretary to establish county loan rates so that the lowest 
     county rate is 95 percent of the national average loan rate. 
     This shall be done only if such action results in no 
     additional outlays. (Section 162, 164, and 165)
       The Managers are concerned that the procedures used by USDA 
     to establish county wheat and feed grain loan rates and 
     posted-county-prices (PCP) may be outdated. The Managers 
     expect USDA to evaluate whether improvements are warranted 
     and to implement such changes before establishing 1997-crop 
     county loan rates.
     (69) Commodity Credit Corporation interest rate
       The House bill, in Section 403 provides that the interest 
     rate charged by CCC on loans for agricultural commodities 
     shall be 100 basis points greater than the rate established 
     by the formula in effect on October 1, 1995.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the Senate provision. 
     (Section 163)


      Subtitle F--Suspension of Permanent Price Support Authority

     (70) Suspension and repeal of permanent authorities
       The House bill, in Section 109 repeals the Agricultural Act 
     of 1949 (certain necessary sections are transferred to the 
     1938 Act), and makes required conforming amendments.
       The Senate amendment, in Paragraph (1) of Section 109(a) 
     suspends the following provisions of the Agricultural 
     Adjustment Act of 1938 for crop years 1996 through 2002:
       (A) acreage allotments for corn, marketing quotas for 
     wheat, marketing quotas for cotton and marketing quotas for 
     rice;
       (B) marketing quotas for peanuts;
       (C) sale, lease and transfer of peanut acreage allotments;
       (D) marketing penalties for peanuts;
       (E) marketing quotas for sugar and crystalline fructose;
       (F) publication and review of peanut quotas;
       (G) preservation of unused cotton allotments;
       (H) wheat marketing allocation; and
       (I) omitted cotton marketing certificates.
       Paragraph (1) of Section 109(b) suspends the following 
     provisions of the Agricultural Act of 1949 for crop years 
     1996 through 2002:
       (A) parity price support for basic agriculture commodities;
       (B) parity price support for cotton;
       (C) parity price support for corn;
       (D) parity price support for wheat;
       (E) Farmer Owned Reserve;
       (F) Agriculture commodities utilization program;
       (G) commodity certificates;
       (H) parity price support for nonbasic agriculture 
     commodities;
       (I) price support provisions not consistent with the 
     Agriculture Market Transition Program;
       (J) acreage base and yield system; and
       (K) Emergency Livestock Feed Assistance Act of 1988.
       Paragraph (2) of Section 109(b) repeals the following 
     provisions of the Agricultural Act of 1949:
       (A) loans, payments and acreage reduction programs;
       (B) peanut price support;
       (C) supplemental set-aside authority;
       (D) deficiency and land diversion payments;
       (E) oilseed loans and payments, sugar price support and 
     honey price support; and
       (F) advance announcement of price support levels.
       Section 109(c) suspends certain quota provisions for wheat 
     and corn.
       The Conference substitute adopts the Senate provision with 
     technical amendments and an amendment that dairy price 
     support under the 1938 Agriculture Adjustment Act shall be 
     suspended through December 31, 2002. The Managers intend for 
     USDA to provide for an orderly termination of the Emergency 
     Livestock Feed Program so that livestock producers within a 
     county are treated consistently. For a period not to exceed 
     thirty days after enactment of this bill, USDA should accept 
     livestock producers' applications for assistance under this 
     program in counties where producers have already been 
     approved for 1996 Livestock Feed Program assistance prior to 
     the date of enactment. (Section 171)
     (71) Effect of amendments
       The House bill, in Section 110 provides that the amendments 
     made by this Act shall not affect the authority of the 
     Secretary to carry out the 1991 through 1995 production 
     adjustment programs in effect before this Act.
       The Senate amendment contains an identical provision.
       The Conference substitute adopts the Senate provision. 
     (Section 172)
       The Managers intend that the Secretary shall seek to reduce 
     paperwork and regulatory burdens of producers. Therefore, the 
     Managers intend that in conducting year-end reviews the 
     Secretary shall take into consideration information and 
     recommendations provided by state and local Farm Service 
     Agency Committees in order to reduce the number of 
     unnecessary year-end reviews.


     Subtitle G--Commission on 21st Century Production Agriculture

     (72) Commission on 21st century production agriculture
       The House bill, in title VI, establishes a commission to be 
     known as the ``Commission on 21st Century Production 
     Agriculture.''
       Section 502--Composition
       Subsection (a). Membership and appointment.
       Subsection (a) of this section requires that the Commission 
     be composed of eleven members: three members appointed by the 
     President; four members appointed by the Chairman of the 
     Committee on Agriculture of the House of Representatives (in 
     consultation with the ranking minority member); and four 
     members appointed by the Chairman of the Committee on 
     Agriculture, Nutrition, and Forestry of the Senate (in 
     consultation with the ranking minority member).
       Subsection (b). Qualifications.
       Subsection (b) establishes the qualifications required of 
     the persons appointed to the Commission. At least one member 
     appointed by each the President, the Chairman of Committee on 
     Agriculture of the House of Representatives, and the Chairman 
     of the Committee on Agriculture, Nutrition, and Forestry of 
     the Senate shall be an individual who is primarily involved 
     in production agriculture. All other members appointed to the 
     Commission must have knowledge and experience in agriculture 
     production, marketing, finance, or trade.
       Subsection (c). Term of members; vacancies.
       Subsection (c) requires that the appointment to the 
     Commission be for the life of the Commission. It also directs 
     that a vacancy on the Commission shall not affect the 
     Commission's power and shall be filled in the same manner as 
     the original appointment.
       Subsection (d). Time for appointment; first meeting.
       Subsection (d) requires that the members of the Commission 
     be appointed no later than October 1, 1997 and that the 
     Commission convene its first meeting 30 days after six 
     members of the Commission have been appointed.
       Subsection (e). Chairman.
       Subsection (e) requires that the chairman of the Commission 
     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.
       Section 503--Comprehensive review of past and future of 
           production agriculture
       Subsection (a). Initial review.
       Subsection (a) of this section requires the Commission to 
     conduct a comprehensive review of changes in the condition of 
     production agriculture in the United States subsequent to the 
     date of enactment of this Act and the extent to which such 
     changes are the result of the changes made by this Act. This 
     review shall include: (1) the assessment of the initial 
     success of market transition contracts in supporting the 
     economic viability of farming in the United States; (2) the 
     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 farm land values and agricultural producer 
     incomes; (4) an assessment of the regulatory relief for 
     agricultural producers that has been enacted and implemented, 
     including the application of cost/benefit principles in the 
     issuance of agricultural regulations; (5) an assessment of 
     the tax relief for agricultural producers that 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; 
     and (7) the assessment of the likely effect of the sale, 
     lease, or transfer of farm poundage quota for peanuts across 
     State lines.
       Subsection (b). Subsequent review.
       Subsection (b) requires the Commission to 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. This review 
     shall include: (1) an assessment of changes in the condition 
     of production agriculture in the United States since the 
     initial review under subsection (a); (2) an identification of 
     the appropriate future relationship of the Federal Government 
     with production agriculture after 2002; and

[[Page H2806]]

     (3) an assessment of the manpower and infrastructure 
     requirements of the Department of Agriculture necessary to 
     support the future relationship of the Federal Government 
     with production agriculture.
       Subsection (c). Recommendations.
       Subsection (c) requires that the Commission develop 
     specific recommendations for legislation to achieve the 
     appropriate future relationship of the Federal Government 
     with production agriculture identified under subsection 
     (a)(2).
       Section 504--Reports.
       Subsection (a). Report on initial review.
       Subsection (a) of this section requires that by June 1, 
     1998, the Commission submit a report containing the results 
     of the initial review to the President, the Committee on 
     Agriculture of the House of Representatives, and the 
     Committee on Agriculture, Nutrition, and Forestry of the 
     Senate.
       Subsection (b). Report on subsequent review.
       Subsection (b) requires that not later than January 1, 
     2001, the Commission submit a report containing the results 
     of the subsequent review conducted under section 1503(b) to 
     the President, the Committee on Agriculture of the House of 
     Representatives, and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate.
       Section 506--Powers
       Subsection (a). Hearings.
       Subsection (a) of this section authorizes the Commission to 
     conduct hearings, take testimony, receive evidence, and act 
     in a manner the Commission considers appropriate to carry out 
     the purposes of this Act.
       Subsection (b). Assistance from other agencies.
       Subsection (b) authorizes the Commission to secure directly 
     from any department or agency of the Federal Government any 
     information necessary to carry out its duties under this 
     title. The head of such department or agency shall furnish 
     information requested by the chairman of the Commission, to 
     the extent permitted by law.
       Subsection (c). Mail.
       Subsection (c) authorizes the Commission to use the United 
     States mails in the same manner and under the same conditions 
     as the departments and agencies of the Federal Government.
       Subsection (d). Assistance from Secretary.
       Subsection (d) requires that the Secretary of Agriculture 
     shall provide appropriate office space and reasonable 
     administrative and support services available to the 
     Commission.
       Section 506--Commission procedures
       Subsection (a). Meetings.
       Subsection (a) of this section requires that the Commission 
     meet on a regular basis. The frequency of such meeting shall 
     be determined by the chairman or a majority of its members. 
     Additionally, the Commission must meet upon the call of the 
     chairman or a majority of the members.
       Subsection (b). Quorum.
       Subsection (b) provides that a majority of the members of 
     the Commission must be present to produce a quorum for 
     transacting the business of the Commission.
       Section 507--Personnel matters
       Subsection (a). Compensation.
       Subsection (a) of this section provides that members of the 
     Commission serve without compensation, but are allowed travel 
     expenses when engaged in the performance of Commission 
     duties, including a per diem in lieu of subsistence, as 
     authorized by section 5703 of title 5, United States Code.
       Subsection (b). Staff.
       Subsection (b) provides that the Commission shall appoint a 
     staff director. The staff director's basic rate of pay shall 
     not exceed that rate provided for under section 5376 of title 
     5, United States Code. The Commission may appoint such 
     professional and clerical personnel as may be reasonable and 
     necessary to enable the Commission to carry out its duties 
     without regard to the provisions governing appointments in 
     the competitive service, title 5, United States Code, and 
     provisions relating to the number, classification, and 
     General Schedule rates in chapter 51 and subchapter III of 
     chapter 53 of title 5 or any other provision of law. No 
     employee appointed by the Commission (other than the staff 
     director) may be compensated at a rate exceeding the maximum 
     rate applicable to level 15 of the General Schedule.
       Subsection (c). Detailed personnel.
       Subsection (c) authorizes the head of any department or 
     agency of the Federal Government to detail, without 
     reimbursement, any personnel of such department or agency to 
     the Commission to assist the Commission in carrying out its 
     duties. The detail of any such personnel may not result in 
     the interruption or loss of civil service status or privilege 
     of such personnel.
       Section 508--Termination of Commission
       This section provides that the Commission shall terminate 
     upon the issuance of its final report required by section 
     1504.
       The Senate amendment contains no similar provision.
       The Conference substitute adopts the House provision with 
     an amendment directing the Commission to make an assessment 
     of economic risk to producers. (Subtitle G)


             Subtitle H--Miscellaneous Commodity Provisions

     (73) Options Pilot Program
       The House bill extends the Options Pilot Program Act of 
     1990 through crop year 2002. (Section 506)
       The Senate amendment establishes an Options Pilot Program 
     and Risk Management Education program. The purpose is to 
     authorize the Secretary to conduct research through pilot 
     programs for one or more program commodities to ascertain 
     whether futures and options contracts can provide producers 
     with reasonable protection from the financial risks of 
     fluctuations in price, yield, and income inherent in the 
     production and marketing of agricultural commodities; and 
     provide education in the management of the financial risks 
     inherent in the production and marketing of agricultural 
     commodities. (Subtitle B)
       The Conference substitute adopts the Senate amendment with 
     an amendment requiring consultation with the CFTC in risk 
     management education. The Managers intend that the Options 
     Pilot Program should be administered by the Office of Risk 
     Management. (Section 191 and 192)
     (74) Single delivery of catastrophic crop insurance
       The House bill, amends section 508(b)(4) of the Federal 
     Crop Insurance Act to provide that the Secretary may only 
     continue to offer catastrophic risk protection through local 
     USDA offices if the Secretary determines that the number of 
     approved insurance providers operating in a State (or a 
     portion of a State) is insufficient to adequately provide 
     catastrophic risk protection coverage to producers. If 
     coverage availability in a State is adequate, only approved 
     insurance providers may provide coverage. (Section 501(a))
       The Senate amendment contains an identical provision. 
     (Section 502(a))
       The Conference substitute adopts the House provision with 
     an amendment requiring USDA to phase in single delivery of 
     catastrophic coverage unless the Secretary determines that 
     the number of private insurers in a State is insufficient. 
     The Secretary must announce the results of such 
     determinations within 90 days following enactment of this 
     section for 1997 crops. The Secretary shall announce the 
     determinations for subsequent crop years by each April 30 of 
     the year previous to the year in which the crop is produced, 
     or at such other times during the year as the Secretary finds 
     practicable in consultation with the affected insurance 
     industry, for those states or areas of states where 
     catastrophic coverage remains available through local offices 
     of the Department.
       In considering the number of approved insurance providers 
     operating in a State (or portion thereof) the Secretary may 
     consider only those private agents who are actively providing 
     catastrophic coverage and are reasonably accessible to 
     producers. The Secretary shall also consider agents who are 
     going to begin offering catastrophic coverage in the crop 
     year in response to this legislation.
       In making such determinations, the Secretary may also 
     consider the willingness of reinsured companies to accept the 
     responsibility for providing and servicing catastrophic 
     coverage on an increased scale in an economical manner 
     without added levels of subsidy or federal government, and to 
     assure that agents will be made available in a convenient 
     manner to all producers who desire service. (Section 193(a))
     (75) Ending mandatory purchase of catastrophic crop insurance
       The House bill provides that, effective with spring-planted 
     1996 crops, catastrophic coverage is not required for federal 
     farm program benefits if producers sign a written waiver with 
     the Secretary that waives any eligibility for emergency crop 
     loss assistance. (Section 501(a))
       The Senate amendment contains an identical provision. 
     (Section 502(a))
        The Conference substitute adopts the House provision with 
     an amendment. The amendment authorizes the Secretary to have 
     discretion to apply the provision for a written waiver to all 
     other 1996 crops. The amendment also provides that, for the 
     1996 crop year only, producers shall be able to obtain 
     catastrophic risk protection insurance for any spring planted 
     crop, and limited or additional coverage for malting barley 
     under the Malting Barley Price and Quality Endorsement, for a 
     period of at least two but less than four weeks after the 
     date of enactment of this Act. Waivers: A waiver under this 
     provision may be provided by the producer at any time up 
     until the time that the producer applies for the respective 
     farm program, or other benefit, or the acreage reporting 
     date. The Secretary may permit that waivers may be generic in 
     nature, so that a producer can sign a single waiver applying 
     to all crops which he or she produces and for which Federal 
     crop insurance has not been obtained or may not be obtained 
     in the future. A waiver under this provision shall not waive 
     a farmer's eligibility to receive an emergency loan. (Section 
     193(a))
     (76) Transfer
       The House bill transfers all catastrophic policies written 
     by USDA to private insurance companies for the performance of 
     all sales, service, and loss adjustment functions to the 
     extent that the Secretary determines that catastrophic risk 
     protection by approved insurance providers is sufficiently 
     available in a State. Any fees in connection with such 
     policies that are not yet collected at time of transfer shall 
     be payable to the private insurance providers. (Section 
     501(a))
        The Senate amendment contains a similar transfer 
     provision. (Section 502(a))
        The Conference substitute adopts the House provision with 
     an amendment delaying transfers of all catastrophic policies

[[Page H2807]]

      written by USDA to private insurance companies until the 
     1997 crop year. The transfer process for 1997 crops with 
     sales closing dates before January 1, 1997 shall begin at the 
     time of the Secretary's announcement under subsection (a) and 
     be completed by a sales closing date for the crop and county. 
     The transfer process for all subsequent policies including 
     crop years after 1997 shall begin at a date that permits the 
     process to be completed not later than 30 days prior to the 
     applicable sales closing date. After 1997, the transfer must 
     be completed not later than 45 days prior to the sales 
     closing date.
       This provision requires that, beginning with crop year 
     1997, in those States (or portions thereof) where the 
     Secretary has determined not to continue to provide 
     catastrophic coverage through local offices of the Farm 
     Service Agency, the Secretary is expected to transfer all 
     existing catastrophic policies written by USDA offices to 
     private insurance providers. This transfer is expected to 
     occur in an orderly manner under procedures determined by the 
     Secretary and developed in consultation with private 
     insurance providers. These procedures should be designed to 
     assure fairness among insurance providers and will take into 
     consideration the needs and preferences of affected 
     producers. (Section 193(a))
     (77) Seed crops
       The House bill amends section 519(a)(2)(B) of the Federal 
     Crop Insurance Act to specify that seed crops are eligible 
     for coverage under the Noninsured Assistance Program. 
     (Section 501(b))
       The Senate amendment, contains an identical provision. 
     (Section 502(b))
       The Conference substitute adopts the Senate amendment 
     (Section 193(b)).
     (78) Aquaculture
       The Senate amendment amends section 508(a)(6) of the 
     Federal Crop Insurance Act to extend crop insurance coverage 
     to aquaculture. (Section 502(d))
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to include ornamental fish as aquaculture in the 
     Noninsured Assistance Program (Section 193(c))
     (79) Pilot projects on insect infestation or disease and 
         feasibility for nursery crops
       The Senate amendment requires the Secretary of Agriculture 
     to develop and administer a two year pilot project for crop 
     insurance coverage that indemnifies crop losses due to insect 
     infestation or disease. The Secretary is required to 
     administer the pilot project so that it is actuarially sound 
     and results in no net cost to the U.S. Treasury. The Senate 
     amendment also requires a limited pilot program on the 
     feasibility of insuring nursery crops within two years of 
     enactment. (Section 502(c) and 502(d))
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate amendment. The 
     Managers agree to inclusion of Senate provisions directing 
     the Secretary to develop and administer pilot projects: (1) 
     for crop insurance coverage that indemnifies crop losses due 
     to natural disasters such as insect infestation or disease 
     and (2) on the feasibility of insuring nursery crops. The 
     conferees intend that to the maximum extent practicable the 
     pilot projects be operated to cover diverse geographic areas 
     so that the full impact of such coverage can be adequately 
     evaluated. (Section 193(d) and 193(e))
     (80) Planting requirement
       The Senate amendment amends section 508(j) of the Federal 
     Crop Insurance Act to require the Corporation to consider 
     marketing windows in determining whether it is feasible to 
     require planting during a crop year. (Section 502 (e))
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate amendment 
     (Section 193(f)) and 3 amendments. The first amendment 
     provides mandatory funding in fiscal year 1997 for the sales 
     commissions of crop insurance agents (Section 193(g)). The 
     second amendment transfers mandatory funding for the 
     Noninsured Assistance Program (NAP) from the Federal Crop 
     Insurance Corporation Fund to the Commodity Credit 
     Corporation (Section 193(g)). The third amendment changes the 
     Noninsured Assistance Program (NAP) by providing the 
     Commodity Credit Corporation with more flexibility in 
     determining the requirements for producers to provide records 
     of crop acreage, yields, and production (Section 193(h)).
     (81) Section 504. Establishment of Office of Risk Management
       The House provision amends Department of Agriculture 
     Reorganization Act of 1994 by establishing an independent 
     Office of Risk Management (ORM). This office shall have 
     jurisdiction over FCIC, and any pilot or other program 
     involving revenue insurance, risk management savings accounts 
     or use of future markets to manage risk. The salaries and 
     expense account of the FSA shall be available to fund 
     operation of this office in fiscal year 1996. (Section 504)
       The Senate contains no comparable provision.
       The Conference substitute adopts the House provision 
     (Section 194).
     (82) Revenue insurance
       The Senate amendment amends section 508(h) of the Federal 
     Crop Insurance Act to establish a revenue insurance pilot 
     program in a limited number of counties for producers of 
     corn, wheat, or soybeans for the 1997-2000 crop years. 
     Revenue insurance policies are to be offered through 
     reinsurance arrangements with private insurance companies in 
     a manner that is actuarially sound with premiums and 
     administrative fees to be paid by insured producers. The 
     minimum level of revenue coverage must be an alternative to 
     catastrophic crop insurance. (Section 503)
       The House bill requires the Secretary to establish a 
     business interruption insurance program. Under this program, 
     the producer of a contract commodity could obtain revenue 
     insurance. (Section 505)
       The Conference substitute adopts the Senate provision with 
     2 amendments. The first amendment allows the revenue 
     insurance pilot program to be established for feedgrains, 
     wheat, soybeans, or such other commodities as determined by 
     the Secretary (Section 195). The second amendment moves 
     Noninsured Assistance Program(NAP) out of the Federal Crop 
     Insurance Act. The Managers intend that the NAP continue to 
     be administered by USDA's Farm Service Agency. Because many 
     NAP crops will over time be covered by the insurance program, 
     it is expected that the Under Secretary for Farm and Foreign 
     Agricultural Services, who will have supervision over both 
     ORM and FSA, should assure that coordination exists between 
     these two agencies in the administration of the NAP. The 
     Managers intend that the Secretary in administering the NAP 
     through the FSA will coordinate, to the maximum extent 
     practicable, various terms and conditions used in 
     administering both the NAP and the Federal Crop Insurance 
     Program. The Managers expect, to the extent practicable, that 
     the Department will build upon information obtained from the 
     NAP in extending coverage to non-insured crops. (Section 196)

                      Title II--Agricultural Trade


Subtitle A--Amendments to Agricultural Trade Development and Assistance 
                    Act of 1954 and Related Statutes

     (1) Food aid to developing countries
       The House bill relocates a Sense of Congress resolution on 
     the importance of food aid from section 411 of the Uruguay 
     Round Agreements Act to section 3 of the Agricultural Trade 
     Development and Assistance Act of 1954 (P.L. 480) to replace 
     an obsolete sense of Congress. (Section 411)
       The Senate amendment has a similar provision with a 
     technical difference. (Section 201)
       The Conference substitute adopts the House provision. 
     (Section 201)
     (2) Trade and development assistance
       The House bill amends section 101 of P.L. 480 to authorize 
     the Secretary to enter into Title I concessional credit 
     agreements with private entities as well as foreign 
     governments. Such private entities may be U.S.-based or 
     indigenous non-profit or for-profit concerns. (Section 412)
       The Senate amendment is identical. (Section 202)
       The Conference substitute adopts the Senate amendment. 
     (Section 202)
     (3) Agreements regarding eligible countries and private 
         entities
       The House bill amends section 102 of P.L. 480 by deleting 
     subsection (a), which defines developing countries in terms 
     of foreign exchange earnings, and reordering the priorities 
     for providing food assistance to increase the emphasis on 
     market development.
       The House bill provides that Section 102 of P.L. 480 is 
     amended to allow agricultural trade organizations (ATOs) to 
     carry out market development plans in connection with Title I 
     agreements. The Secretary is directed to give priority to 
     those agreements with developing countries and agricultural 
     trade organizations that include a market and economic 
     development component. (Section 413)
       The Senate amendment contains a similar provision, except 
     for a technical difference in section 102(c)(2). (Section 
     203)
       The Conference substitute adopts the House provision with 
     an amendment that gives the Secretary the discretion to 
     reimburse agricultural trade organizations for administrative 
     expenses incurred in carrying out market development plans 
     under Title I. (Section 203)
     (4) Terms and Conditions of Sales
       The House bill amends Section 103 of P.L. 480:
       (1) to include references to private entities;
       (2) to allow for a repayment period with respect to Title I 
     agreements of less than ten years in Title I agreements; and
       (3) to reduce to five years the maximum ``grace'' period 
     during which the Secretary is allowed to defer repayments. 
     (Section 414)
       The Senate amendment is identical. (Section 103)
       The Conference substitute adopts the Senate amendment. 
     (Section 204)
       (5) Use of local currency payment
       The House bill amends Section 104 of P.L. 480 to include 
     private entities as eligible to use local currencies. 
     (Section 415)
       The Senate amendment is identical. (Section 104)
       The Conference substitute adopts the House provision. 
     (Section 205)
     (6) Value-added foods
       The Senate amendment repeals an unused provision that 
     allows for a partial waiver of repayment under title 
     I(section 105 of P.L. 480). (Section 206)
       The House bill has no comparable provision.

[[Page H2808]]

       The Conference substitute adopts the Senate amendment. 
     (Section 206)
     (7) Eligible organizations
       The House bill amends Section 202(b) of P.L. 480 to 
     prohibit the Administrator of the Agency for International 
     Development (AID) from denying a request for commodities 
     under Title II by PVOs or other eligible organizations to 
     carry out a program merely because AID does not maintain a 
     mission in the country in which the program will be carried 
     out.
       The House bill also amends Section 202(e) of P.L. 480:
       (1) by increasing from $13.5 million to $28 million the 
     portion of Title II appropriations that may be used to pay 
     transportation, distribution and other costs of eligible 
     organizations;
       (2) by making intergovernmental organizations (e.g., the 
     World Food Program) eligible for such funds.
       The Senate amendment is similar except that it requires 
     private voluntary organizations and cooperatives to submit 
     requests for funds. (Section 207)
       The Conference adopts the Senate amendment with a technical 
     change requiring that eligible organizations submit requests 
     for funds. (Section 207)
     (8) Generation and use of foreign currencies
       The House bill amends Section 203 of P.L. 480 to allow 
     local-currency proceeds from Title II commodity sales to be 
     used in a country different from the one in which the 
     commodities were sold, as long as it is in the same 
     geographic region where sales in the targeted country would 
     be impracticable. The section also increases from ten percent 
     to fifteen percent the minimum amount of non-emergency Title 
     II commodities that the Administrator must allow to be sold 
     for local currencies. (Section 417)
       The Senate amendment is identical. (Section 208)
       The Conference substitute adopts the House provision. 
     (Section 208)
     (9) General levels of assistance under P.L. 480
       The House bill amends Section 204(a) of P.L. 480 to extend 
     through 2002 the 1995 minimum tonnage levels for both overall 
     assistance and non-emergency assistance under Title II. The 
     House bill also provides that AID is prohibited from waiving 
     the non-emergency minimum tonnage requirement before the 
     beginning of a fiscal year. (Section 418)
       The Senate amendment is identical. (Section 209)
       The Conference substitute adopts the House provision with 
     an amendment requiring that at least 50 percent of bagged 
     commodities programmed under Title II be bagged in the U.S. 
     (Section 209)
     (10) Food aid consultative group
       The House bill amends section 205 of P.L. 480 to extend an 
     existing consultative group on food aid through 2002; to 
     require that the group meet at least twice per year; and to 
     require that an agricultural producer be a member of the 
     group. Agricultural trade organizations are also made 
     eligible for participation. (Section 419)
       The Senate amendment is identical. (Section 210)
       The Conference substitute adopts the Senate amendment. 
     (Section 210)
     (11) Support of nongovernmental organizations
       The House bill amends Section 306(b) of P.L. 480 to allow 
     the ten percent of local currency proceeds set aside for use 
     in the recipient country for rural development, education and 
     other purposes to be used for the same purposes by 
     nongovernmental organizations that are not indigenous. A 
     conforming amendment is made in the definition of 
     nongovernmental organization in Section 402(6) of P.L. 480. 
     (Section 420)
       The Senate amendment is identical. (Section 211)
       The Conference substitute adopts the House provision. 
     (Section 211)
     (12) Commodity determinations
       The House bill amends Section 401 of P.L. 480 to simplify 
     the process by which the Secretary determines which 
     commodities are eligible for P.L. 480 (the docket authority), 
     while retaining the same basic standards for commodity 
     eligibility as at present. The formal requirements for a 
     determination of commodity availability are eliminated. 
     (Section 421)
       The Senate amendment is identical. (Section 212)
       The Conference substitute adopts the Senate amendment. 
     (Section 212)
     (13) General provisions
       The House bill amends Section 403 of P.L. 480 to delete 
     requirements for the U.S. to consult with several specific 
     international organizations. (Section 422)
       The Senate amendment is identical. (Section 213)
       The Conference substitute adopts the House provision. 
     (Section 213)
     (14) Agreements
       The House bill amends Section 404 of P.L. 480 to make 
     several conforming changes and to clarify that an existing 
     authority for multi-year agreements under Titles I and III is 
     discretionary, but mandatory for Title II. (Section 423)
       The Senate amendment is identical. (Section 214)
       The Conference substitute adopts the Senate amendment. 
     (Section 214)
     (15) Use of Commodity Credit Corporation
       The Senate amendment amends Section 406 of P.L. 480 to make 
     technical changes to administrative provisions of P.L. 480 
     and to make conforming changes. (Section 215)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 215)
     (16) Administrative provisions
       The House bill makes technical changes to Section 407 of 
     P.L. 480. The Secretary and the Administrator are also given 
     discretion in setting the terms for freight contracts under 
     Title I and Titles II and III, respectively, as under current 
     practice. Additional conforming changes are made and two 
     required annual reports are combined. (Section 424)
       The Senate amendment is identical. (Section 216)
       The Conference substitute adopts the House provision with a 
     grammatical correction. (Section 216)
     (17) Expiration date
       The House bill amends Section 408 of P.L. 480 to extend 
     authority to enter into agreements for P.L. 480 programs 
     through 2002. (Section 425)
       The Senate amendment is identical. (Section 217)
       The Conference substitute adopts the Senate amendment. 
     (Section 217)
     (18) Regulations
       The House bill repeals Section 409 of P.L. 480, which 
     required regulations to be issued following enactment of the 
     1990 farm bill. (Section 426)
       The Senate amendment is identical. (Section 218)
       The Conference substitute adopts the House provision. 
     (Section 218)
     (19) Independent evaluation of programs
       The House bill repeals Section 410 of P.L. 480, which 
     required General Accounting Office evaluations of P.L. 480 
     that have been completed. (Section 427)
       The Senate amendment is identical. (Section 219)
       The Conference substitute adopts the Senate amendment. 
     (Section 219)
     (20) Authorization of appropriations
       The House bill deletes Section 412(b) of P.L. 480 and 
     eliminates a requirement that each of Titles I and III funds 
     be at least forty percent of the combined funding for Titles 
     I and III. Subsection (c) is amended to allow up to fifteen 
     percent of the funds available in any fiscal year for any 
     title of P.L. 480 to be used for any other title and to allow 
     unlimited transfers of funds from Title III to Title II. The 
     House bill provides that all of Title I transfer authority 
     must be exhausted before use of the waiver authority is 
     allowed. (Section 428)
       The Senate amendment is similar. (Section 220)
       The Conference substitute adopts the Senate provision with 
     an amendment that limits transfers from P.L. 480 Title III 
     funding to fifty percent. The Managers intend that USAID will 
     not routinely waive Title II non-emergency minimum tonnage 
     levels, but will operate this waiver authority only in 
     exceptional circumstances. The responsible Congressional 
     committees should be consulted prior to USAID exercising 
     waiver authority. (Section 220)
     (21) Coordination of foreign assistance programs
       The House bill amends Section 413 of P.L. 480 to clarify 
     that a requirement for coordination with U.S. development 
     assistance policies applies only to Title III. (Section 429)
       The Senate amendment is identical. (Section 413)
       The Conference substitute adopts the House provision. 
     (Section 221)
     (22) Micronutrient Fortification Pilot Program
       The Senate amendment requires the establishment of a pilot 
     program by the end of 1997 to fortify grains made available 
     under P.L. 480 with micronutrients such as Vitamin A or iron. 
     The purpose of the pilot program is to assist developing 
     countries in correcting micronutrient deficiencies and to 
     encourage development of technologies for fortification of 
     grains and other commodities. The Secretary is directed to 
     select not more than 5 developing countries to participate in 
     the program. The authority for the pilot program expires in 
     2002. (Section 222)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment providing that the program be carried out if 
     practical technology exists and it is cost effective. 
     (Section 222)
     (23) Use of certain local currency
       The House bill adds a new section to Title IV of P.L. 480 
     to expressly permit the Secretary to use local currency 
     proceeds collected under agreements entered into prior to the 
     Food, Agriculture Conservation Act of 1990 consistent with 
     the law as in effect at the time the agreements were entered 
     into. (Section 430)
       The Senate amendment is identical. (Section 416)
       The Conference substitute adopts the House provision. 
     (Section 223)
     (24) Farmer-to-Farmer Program
       The House bill amends Section 501 of P.L. 480 to increase 
     the minimum percentage of the P.L. 480 funding available for 
     the Farmer-to-Farmer program from .2 percent to .4 percent 
     and extends Farmer-to-Farmer to emerging markets. The 
     authorization for the program is extended through fiscal year 
     2002. (Section 431)

[[Page H2809]]

       The Senate amendment allows for the travel of foreign 
     farmers and other professionals to the United States. 
     (Section 224)
       The Conference substitute adopts the House provision with 
     an amendment allowing for the use of local currencies 
     generated through P.L. 480, Section 416 and Food for Progress 
     to meet the costs of the Farmer-to-Farmer program. (Section 
     224)
     (25) Food Security Commodity Reserve
       The House bill amends title III of the Agricultural Act of 
     1980 by:
       (1) converting the Food Security Wheat Reserve to the Food 
     Security Commodity Reserve;
       (2) changing the short title to ``Food Security Commodity 
     Reserve Act of 1996'';
       (3) making corn, sorghum, and rice eligible commodities for 
     the reserve;
       (4) establishing a four million metric ton cap on the 
     reserve;
       (5) making the reserve consist of: (a) wheat in the reserve 
     as of the date of enactment of the Act; (b) wheat, rice, 
     corn, and sorghum acquired through the exchange of an 
     equivalent value of wheat in the reserve for those 
     commodities;
       (6) providing that the reserve may be replenished through 
     purchases or by designation of commodities owned by the 
     Commodity Credit Corporation
       (7) providing for the release of up to 500,000 metric tons 
     per year if the Secretary determines that inadequate amounts 
     of commodities are available for emergency assistance under 
     Title II of P.L. 480 (plus, any commodities that could have 
     been released but were not released in prior fiscal years);
       (8) providing that the authority to replenish the reserve 
     expires at the end of fiscal year 2002. (Section 432)
       The Senate amendment is similar to the House bill on the 
     establishment and replenishment of the reserve. The Senate 
     amendment provides that the Secretary may release eligible 
     commodities from the reserve for emergency food assistance to 
     developing countries when quantities of eligible commodities 
     are so limited that eligible commodities cannot be made 
     available for disposition. Additionally up to one million 
     metric tons may be released annually from the reserve for 
     urgent humanitarian relief under Title II of P.L. 480, if the 
     Secretary certifies than funds made available to carry out 
     P.L. 480 are not reduced from the prior year. The term 
     ``cannot be made available under the normal means'' does not 
     require the waiver of the sub-minimum requirements under 
     Title II of P.L. 480 before the commodities can be released 
     from the reserve in any fiscal year.
       The Conference substitute adopts the Senate provision with 
     an amendment providing that in order to meet unanticipated 
     need for emergency assistance under section 202(a) of P.L. 
     480, the Secretary may release up to 500,000 metric tons of 
     commodities and up to 500,000 metric tons of eligible 
     commodities that could have been released but were not 
     released in prior fiscal years.
       Although the conference report contains the language from 
     the Senate bill permitting release of commodities from the 
     reserve in the case of limited domestic supply, the primary 
     purpose of the reserve is to supply commodities for urgent 
     humanitarian needs in addition to assistance made available 
     under Titles I, II and III of P.L. 480. The intent is for the 
     commodities in the reserve to be available when the 475,000 
     metric tons of commodities in the Title II unallocated 
     reserve is not adequate to meet emergency needs and in the 
     case of limited domestic supply of commodities. (Section 225)
     (26) Protein byproducts derived from alcohol fuel production
       The Senate amendment repeals an obsolete provision (section 
     1208 of the Agriculture and Food Act of 1981) requiring an 
     investigation and report on the use of protein byproducts in 
     aid programs. (Section 226)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 226)
     (27) Food for Progress Program
       The House bill amends The Food for Progress Act of 1985:
       (1) to eliminate an obsolete provision exempting 
     commodities furnished to the former Soviet Union from the 
     annual tonnage limitation during 1993;
       (2) to make intergovernmental organizations eligible for 
     the program;
       (3) to allow the Commodity Credit Corporation to make sales 
     on credit terms under this program to countries other than 
     the former Soviet Union;
       (4) to extend authority for the Food for Progress program 
     through fiscal year 2002;
       (5) to make multi-year agreements discretionary rather than 
     mandatory;
       (6) to permit technical assistance to be provided to 
     agricultural trade organizations, private voluntary 
     organizations, and intergovernmental organizations for 
     monetization programs; and
       (7) to make several conforming amendments. (Section 433)
        The Senate amendment is identical. (Section 226)
       The Conference substitute adopts the Senate amendment. 
     (Section 227)
     (28) Use of foreign currency proceeds from export sales 
         financing
       The Senate amendment repeals an obsolete provision (section 
     402 of the Mutual Security Act of 1954) dealing with 
     appropriations during 1961. (Section 228)
       The House bill has no comparable provision.
       The Conference adopts the Senate amendment. (Section 228)
     (29) Stimulation of foreign production
       The Senate amendment repeals an unused provision of law 
     (section 7 of the Act of December 30, 1947) providing 
     authority to stimulate foreign production through donations 
     and similar actions. (Section 229)
       The House has no similar provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 229)


      Subtitle B--Amendments to the Agricultural Trade Act of 1978

     (30) Agricultural export promotion strategy
       The House bill amends Section 103 of the Agricultural Trade 
     Act of 1978 as follows:
       Subsection (a) requires the Secretary to develop a strategy 
     for implementing agricultural export programs.
       Subsection (b) states that the strategy shall encourage the 
     maintenance, development, and expansion of export markets, 
     and places emphasis on high-value and value-added products.
       Subsection (c) establishes the following goals: (1) 
     increasing to $60 billion annual agricultural exports by 
     2002; (2) raising U.S. world market share in 2002 
     significantly above the 1993-95 share; (3) increasing the 
     U.S. share of world high-value agricultural trade to twenty 
     percent; (4) increasing U.S. agricultural exports at a faster 
     rate than the rate of growth in world agricultural trade; (5) 
     increasing U.S. exports of high-value products at a faster 
     rate than the rate of growth in world exports; and (6) 
     ensuring the implementation of Uruguay Round obligations that 
     offer increased market opportunities for U.S. agriculture.
       Subsection (d) requires the Secretary to identify priority 
     markets with respect to the export strategy and to identify 
     the overseas offices of the Foreign Agricultural Service that 
     provide assistance in those markets.
       Subsection (e) requires a report to Congress by December 
     31, 2001 assessing progress in meeting the goals established.
       Subsection (f) prohibits the Secretary from carrying out 
     export promotion programs under the Agricultural Trade Act of 
     1978 if the Secretary determines that three or more of the 
     preceding goals are not met.
       The Secretary is required to promote exports under 
     authorities of the CCC Charter Act if the other authority is 
     ended.
       The prior requirement for the Long-term Agricultural Trade 
     Strategy Report is repealed. (Section 451)
       The Senate amendment is identical. (Section 241)
       The Conference substitute adopts the House provision with 
     an amendment revising the strategy's goals and striking the 
     sunset of export program authority if goals are unmet, while 
     adding a Sense of Congress resolution calling on the House 
     and Senate agriculture committees to conduct a thorough 
     review of export promotion and food aid programs not later 
     than 1998. (Section 241)
     (31) Implementation of commitments under Uruguay Round 
         agreements
       The House bill amends the Agricultural Trade Act of 1978 to 
     require the Secretary to monitor other countries' compliance 
     with the Uruguay Round Agreements. If the Secretary 
     determines an instance of non-compliance will significantly 
     constrain U.S. exports, the Secretary is directed to 
     recommend to the U.S. Trade Representative any appropriate 
     action under U.S. laws and to notify relevant Congressional 
     committees of the recommendation. (Section 271)
       The Senate amendment is identical. (Section 271)
       The Conference substitute adopts the Senate provision by 
     amending the Agricultural Trade Act of 1978 and adds a 
     provision to require the Secretary to evaluate compliance, 
     monitor, take action and report on violations of sanitary and 
     phytosanitary commitments. The managers intend that nothing 
     in this section diminishes or alters the responsibilities of 
     the Secretary of Agriculture under current law to assist 
     exporters of U.S. agriculture products in the event of 
     sanitary or phytosanitary disputes or to fulfill the 
     responsibilities assigned to the Secretary regarding sanitary 
     and phytosanitary measures. (Section 242)

                          (32) Export credits

       The House bill amends Section 202 of the Agricultural Trade 
     Act of 1978:
       (1) to authorize credit guarantees under GSM-102 in 
     connection with a sale to a buyer in a foreign country 
     (supplier credits) on terms of not more than 180 days;
       (2) to list criteria that may be used by the Secretary in 
     deciding whether a country is creditworthy for GSM-103 
     intermediate credit guarantees;
       (3) to allow credit guarantees to be used where the bank 
     issuing the underlying letter of credit is located in a 
     country other than the importing country;
       (4) to require that minimum amounts of credit guarantees be 
     available for processed and high-value products: 25% in 1996 
     and 1997, 30% in 1998 and 1999, and 35% thereafter, except 
     that the minimum requirements are not applicable if they 
     would compel a reduction in total commodity sales under the 
     programs;
       (5) to extend current cumulative funding levels for GSM-102 
     and GSM-103 but allow flexibility in how much is made 
     available for each program; and

[[Page H2810]]

       (6) to allow credit guarantees for high-value products with 
     at least 90% U.S. content by weight, allowing for spices and 
     other components that are sometimes of foreign origin. 
     (Section 452)
       The Senate amendment is identical. (Section 242)
       The Conference substitute adopts the Senate provision with 
     an amendment on origination fees for the facilities financing 
     program, technical changes in definitions and technical 
     modifications to the criteria for determinations under 
     intermediate export credit guarantees. (Section 243)
     (33) Market Promotion Program
       The House bill authorizes the Market Promotion Program 
     expenditures at $100 million during fiscal years 1996-2002. 
     (Section 401)
       The Senate amendment authorizes the Market Promotion 
     Program expenditures at $70 million per year during FY 1996-
     2002 and targets the program exclusively toward small 
     businesses, farmer owned cooperatives and agricultural 
     groups. (Section 243)
       The Conference substitute adopts the Senate provision with 
     an amendment providing for annual funding of $90 million, 
     adopting reform language patterned after the 1996 
     appropriation act, and changing the name to the Market Access 
     Program.
       The amendment to the Market Access Program provides that 
     funds may not be provided to foreign for-profit corporations 
     not including U.S. subsidiaries, to fund their own campaigns 
     to promote their foreign-produced products. The restriction 
     on providing Market Access Program assistance under this 
     section is not intended to prevent Market Access Program 
     participants from carrying out normal business activities 
     (including contracting for services) with respect to the 
     conduct of overseas promotional activities for U.S. 
     agricultural commodities and products of those commodities or 
     from directly conducting promotional campaigns for U.S. 
     agricultural commodities and products of those commodities. 
     (Section 244)
     (34) Export Enhancement Program
       The House bill caps Export Enhancement Program expenditures 
     at $350 million in each of 1996 and 1997; $500 million in 
     1998; $550 million in 1999; $579 million in 2000 and $478 
     million for each of 2001 and 2002. The House bill also 
     requires priority funding from the Export Enhancement Program 
     for wheat flour exports, consistent with the obligations 
     required by the Uruguay Round agreement on agriculture, and 
     in amounts sufficient to maintain the share of the world 
     wheat flour market achieved by the U.S. during the 1986 to 
     1990 period. (Section 402)
       The Senate amendment is identical on funding and 
     authorization of the program, but does not contain a 
     provision on priority funding for wheat flour. (Section 244)
       The Conference substitute adopts the House provision with 
     an amendment to reduce funding for the Export Enhancement 
     Program to $250 million in 1997 and by providing the 
     Secretary with authority to make available not more than $100 
     million annually for the sale of intermediate products, so 
     that the volume of export sales under this section is 
     consistent with the volume of sales of intermediate 
     agriculture products achieved by the United States in the 
     1986 to 1990 period.
       This section was made discretionary due to budgetary 
     concerns arising from the provision in the House bill 
     requiring Export Enhancement Program priority funding for 
     wheat flour. Nevertheless, the Managers remain concerned that 
     the Administration has not utilized its existing Export 
     Enhancement Program assistance authorities appropriately. The 
     Export Enhancement Program has not been used in fiscal year 
     1996 to export wheat flour similar to previous years, 
     although the U.S. share of the world flour market has 
     declined. The most recent wheat flour exports under the 
     Export Enhancement Program were last made in August 1995. The 
     Managers encourage the Administration to resume exporting 
     customary quantities of flour through the Export Enhancement 
     Program as soon as possible. Intermediate products are 
     principally semi-processed products in the intermediate stage 
     of the food chain such as wheat flour and vegetable oil.
       The Managers note that because of the current tight U.S. 
     supplies of milling quality durum wheat and the importance of 
     maintaining adequate supplies of durum available to the U.S. 
     milling and pasta manufacturing industries, the Secretary is 
     expected to continue to consider the stocks-to-use ratio 
     before approving federal export subsidies for No. 1 and No. 2 
     Hard Amber Durum wheat. (Section 245)
     (35) Export program and food assistance transfer authority
       The House bill allows funds for export subsidy programs 
     that cannot be fully or effectively utilized to be used for 
     other agricultural export or food assistance programs. 
     (Section . . .)
       The Senate amendment has no comparable provision.
       The Conference substitute adopts the Senate amendment which 
     deletes the House provision.
     (36) Arrival certification
       The House bill amends Section 401 of the Agricultural Trade 
     Act of 1978 to eliminate an unnecessary requirement for the 
     Secretary to obtain certification from the exporter that 
     there were no corrupt payments or similar practices. Such 
     practices are already illegal under other laws. (Section 453)
       The Senate amendment is identical. (Section 245)
       The Conference substitute adopts the Senate amendment. 
     (Section 246)
     (37) Compliance
       The Senate provision amends Section 402 of the Agricultural 
     Trade Act of 1978 to eliminate an existing authority for USDA 
     to demand private firms' records that are unrelated to 
     federal export program transactions. USDA's ability to 
     examine program-related records is maintained. (Section 246)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 247)
     (38) Regulations
       The House bill repeals an obsolete requirement (section 404 
     of the Agricultural Trade Act of 1978) for the issuance of 
     regulations. (Section 455)
       The Senate amendment is identical. (Section 247)
       The Conference substitute adopts the House provision. 
     (Section 248)
     (39) Trade Compensation and Assistance Program
       The Senate amendment requires that if a unilateral export 
     embargo is imposed on any country in the future, and if no 
     other country joins the U.S. sanctions within six months, the 
     Secretary must increase Commodity Credit Corporation funding 
     for food assistance and export promotion programs by an 
     amount equal to ninety percent of the most recent three 
     years' average agricultural exports to the embargoed country. 
     The expanded assistance would be provided for the shorter of 
     two years or the duration of the embargo. (Section 248)
       The House bill has no similar provision.
       The Conference substitute adopts the Senate amendment with 
     an amendment to extend the length of embargo protection to 
     three years. The amendment allows for either increased 
     funding for food assistance and export promotion programs or 
     direct payments to farmers in an amount equal to embargo 
     caused price declines. The amendment also states that 
     compensation will not be provided if a country with an 
     ``agricultural economic interest'' joins the U.S. sanctions 
     within ninety days, and makes an exception to the application 
     of this section in case of war or armed hostilities. If the 
     Secretary determines that increased funding for export or 
     food assistance programs will provide the greatest 
     compensatory benefit in cases of agricultural export 
     embargoes, the Managers expect the Secretary to target such 
     relief so that farmers affected by the embargo will receive 
     relief.
       The Managers intend that for purposes of this section, 
     ``agricultural products'' shall have the same meaning as for 
     purposes of the GSM-102 export credit guarantee program and 
     similar authorities. (Section 249)
     (40) Foreign Agricultural Service
       The House bill amends Section 503 of the Agricultural Trade 
     Act of 1978 to change the basic mission areas of the Foreign 
     Agricultural Service to reflect the 1993 merger of FAS with 
     the Office of International Cooperation and Development. 
     (Section 456)
       The Senate amendment is identical. (Section 249)
       The Conference substitute adopts the Senate amendment. 
     (Section 250)
     (41) Reports
       The House bill amends Section 603 of the Agricultural Trade 
     Act of 1978 to state that the requirement for quarterly 
     reports on U.S. export assistance is subject to existing 
     authority for the Secretary to set priorities in deciding 
     which reports to prepare. (Section 457)
       The Senate amendment is identical. (Section 250)
       The Conference substitute adopts the House provision. 
     (Section 251)
     (42) Foreign Market Development Cooperator Program
       The House bill authorizes the Foreign Market Development 
     (FMD) cooperator program through 2002, provided that 
     appropriated funds be used to assist in the carrying out of 
     approved market development plans by the cooperators. 
     (Section 489)
       The Senate amendment is identical. (Section 273)
       The Conference substitute adopts the Senate amendment. The 
     Conferees note that these provisions add to the more 
     generally expressed authority for the Foreign Market 
     Development cooperator program currently found in the 
     Agricultural Act of 1954 and related provisions of law, and 
     more importantly spell out that the Foreign Market 
     Development cooperator program is to be carried out by the 
     U.S. Department of Agriculture, in cooperation with eligible 
     trade organizations, through multi-year contracts or 
     agreements under which cost-share assistance is provided to 
     such organizations. (Section 252)


                       Subtitle C--Miscellaneous

     (43) Reporting requirements relating to tobacco
       The House bill repeals an existing reporting requirement 
     for tobacco exports (Section 214 of the Tobacco Adjustment 
     Act of 1983). (Section 471)
       The Senate amendment is identical. (Section 251)
       The Conference substitute adopts the Senate amendment. 
     (Section 262)
     (44) Triggered export enhancement
       The House bill repeals obsolete provisions for marketing 
     loans and other export and

[[Page H2811]]

     farm program provisions that were conditioned on failure to 
     achieve a Uruguay Round agreement by specified dates. The 
     provisions expired with the 1995 crops. (Section 472)
       The Senate amendment is identical. (Section 252)
       The Conference substitute adopts the House provision. 
     (Section 263)
     (45) Disposition of commodities to prevent waste
       The House bill amends Section 416 of the Agricultural Act 
     of 1949:
       (1) to allow Commodity Credit Corporation funds to be used 
     to cover administrative expenses of section 416(b) overseas 
     donation programs;
       (2) to allow more flexibility in the length of time within 
     which monetized proceeds must be expended;
       (3) to eliminate a requirement for the Agency for 
     International Development to respond to a proposal by a 
     nonprofit or voluntary agency or cooperative within certain 
     deadlines;
       (4) to eliminate obsolete requirements for the minimum 
     amount of commodities to be made available in 1988, 1989, and 
     1990;
       (5) to eliminate redundant statement of authority for the 
     Secretary to dispose of surplus commodities under 416(b) 
     through title I of P.L. 480 or export bonus or promotion 
     programs; and
       (6) to eliminate an obsolete provision concerning the 
     Philippines. (Section 473)
       The Senate amendment is identical. (Section 253)
       The Conference substitute adopts the House provision with 
     an amendment striking the authority to use CCC funds for 
     administrative expenses but allowing private voluntary 
     organizations and intergovernmental organizations to use 
     monetized local currencies for administrative expenses. 
     (Section 264)
     (46) Direct sales of dairy products
       The Senate amendment repeals an unused provision for direct 
     export sales of CCC-owned dairy products (Section 106 of the 
     Food and Agriculture Act of 1981). Authority remains for such 
     sales under the CCC Charter Act. (Section 254)
       The House bill has no similar provision.
       The Conference substitute adopts the House provision which 
     deletes the Senate amendment.
     (47) Export sales of dairy products
       The Senate amendment repeals unused provisions similar to 
     those repealed by Section 304 above (section 1163 of the Food 
     Security Act of 1985). (Section 255)
       The House bill has no similar provision.
       The Conference substitute adopts the House provision which 
     deletes the Senate amendment.
     (48) Debt-for-health-and-protection swap
       The House bill repeals authority for ``debt-for-health-and-
     protection swaps'' that has never been funded by 
     appropriations (section 1517 of the Food, Agriculture, 
     Conservation, and Trade Act of 1990). (Section 474)
       The Senate amendment is identical. (Section 257)
       The Conference substitute adopts the House provision. 
     (Section 265)
     (49) Policy on expansion of international markets
       The House bill repeals an outdated statement of the sense 
     of Congress concerning several trade policy issues that were 
     current at the time of the 1981 farm bill (Section 1207 of 
     the Food Act of 1981). (Section 475)
       The Senate amendment is identical. (Section 257)
       The Conference substitute adopts the House provision. 
     (Section 266)
     (50) Policy on maintenance and development of export markets
       The House bill amends an existing statement of U.S. 
     agricultural trade policies (Section 1121 of the Food 
     Security Act of 1985). The agricultural trade policy of the 
     United States is declared: (1) to be the premier world 
     supplier of agricultural products, (2) to support free and 
     fair trade, (3) to negotiate further reductions in trade 
     barriers, including sanitary and phytosanitary barriers, and 
     (4) to aggressively counter unfair foreign trade practices. 
     (Section 476)
       The Senate amendment is identical. (Section 258)
       The Conference substitute adopts the House provision. The 
     Managers intend for the terms ``agriculture'' and ``food and 
     fiber'' to include, but not be limited to, fiber and fiber 
     products, and perennial turfgrass sod.(Section 267)
       The Managers also accepted an amendment establishing an 
     agricultural export excellence award to be named the Edward 
     R. Madigan United States Agricultural Export Excellence 
     Award. The purpose of the award is to identify and reward 
     efforts to develop and expand markets for United States 
     agriculture exports throughout the development of new 
     products and through the use of innovative marketing 
     techniques. The categories for which awards are given are (1) 
     development of new products or services; (2) development of 
     new markets for agriculture; and (3) creative marketing of 
     products or services in agriculture export markets.
       This section sets forth qualification criteria; establishes 
     a selection board to make recommendations to the Secretary; 
     and authorizes the Secretary to seek and accept gifts from 
     public and private sources to carry out the award program 
     established under this section.
       The award is named in honor of the late Edward R. Madigan, 
     the former Secretary of Agriculture and Member of Congress 
     who served on the Committee on Agriculture, in recognition of 
     his service to United States agriculture and the promotion of 
     U.S. agricultural export trade. The Managers believe that the 
     award is a fitting tribute to the memory and legacy of a man 
     whose dedication to the future of U.S. agriculture continues 
     to inspire. (Section 261)
     (51) Policy on trade liberalization
       The House bill repeals a statement of the sense of Congress 
     from the 1985 farm bill that called for a new round of GATT 
     negotiations (Section 1122 of the Food Security Act of 1985). 
     (Section 477)
       The Senate amendment is identical. (Section 259)
       The Conference substitute adopts the Senate amendment. The 
     Managers note the importance of strong participation in 
     international agricultural organizations particularly with 
     regard to monitoring use of sanitary and phytosanitary 
     barriers and technical barriers to trade. (Section 268)
     (52) Agricultural trade negotiations
       The House bill amends Section 1123 of the Food Security Act 
     of 1985 to establish goals for future agricultural trade 
     negotiations, including further reductions in trade barriers, 
     limitations on foreign production supports and the 
     elimination of export subsidies, and disciplines on export 
     monopolies. (Section 478)
       The Senate amendment is identical but for a technical 
     difference. (Section 260)
       The Conference substitute adopts the House provision. 
     (Section 269)
     (53) Policy on unfair trade practices
       The House bill repeals a resolution from the 1985 farm bill 
     that dealt with several U.S.-European disputes of the time 
     (Section 1164 of the Food Security Act of 1985). (Section 
     479)
       The Senate amendment is identical. (Section 261)
       The Conference substitute adopts the Senate amendment. 
     (Section 270)
     (54) Agricultural aid and trade missions
       The House bill repeals a requirement for ``aid and trade 
     missions'' which were concluded several years ago. (Section 
     480)
       The Senate amendment is identical. (Section 262)
       The Conference substitute adopts the House provision. 
     (Section 271)
     (55) Annual reports by agricultural attaches
       The House bill deletes a requirement for reporting by 
     agricultural attaches on fruits, vegetables, legumes, 
     popcorn, and ducks (Section 108(b)(1)(B)). (Section 481)
       The Senate amendment is identical. (Section 263)
       The Conference substitute adopts the Senate amendment. 
     (Section 272)
     (56) World livestock market price information
       The House bill repeals a requirement for the development of 
     international livestock price information that duplicates 
     existing reporting by the Foreign Agricultural Service 
     (Section 1545 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990). (Section 482)
       The Senate amendment is identical. (Section 264)
       The Conference substitute adopts the House provision. 
     (Section 273)
     (57) Orderly liquidation of stocks
       The House bill repeals an obsolete provision requiring the 
     liquidation of stocks held by the Commodity Credit 
     Corporation (Sections 201 and 207 of the Agricultural Act of 
     1956). (Section 483)
       The Senate amendment is identical. (Section 265)
       The Conference substitute adopts the Senate amendment. 
     (Section 274)
     (58) Sales of extra-long staple cotton
       The House bill repeals an obsolete provision concerning the 
     sale of stocks of extra-long staple cotton owned by the 
     Commodity Credit Corporation in 1956 (Section 202 of the 
     Agricultural Act of 1956). (Section 484)
       The Senate bill is identical. (Section 266)
       The Conference substitute adopts the House provision. 
     (Section 275)
     (59) Regulations
       The House bill eliminates an obsolete provision requiring 
     the issuance of regulations (Section 707(d) of P.L. 102-511) 
     for a direct credit sales program for the Former Soviet 
     Union. (Section 485)
       The Senate amendment is identical. (Section 267)
       The Conference substitute adopts the Senate amendment. 
     (Section 276)
     (60) Emerging markets
       The House bill amends Section 1542 of the Food, 
     Agriculture, Conservation and Trade Act of 1990 in Subsection 
     (a) by:
       (1) revising an existing program of technical assistance 
     for emerging democracies, by re-targeting it to ``emerging 
     markets;''
       (2) amending subsection (f) to define ``emerging market'' 
     as a country that the Secretary determines is taking steps 
     toward a market-oriented economy and that has the potential 
     to provide a viable and significant market for U.S. 
     agricultural commodities;
       (3) amending subsection (a) to extend the program through 
     2002 and during 1996-2002, requiring CCC to make available at 
     least $1 billion for credit guarantees to emerging markets;
       (4) amending subsection (d) to add identification of trade 
     barriers to the list of activities that technical experts 
     should undertake

[[Page H2812]]

     under the program, to give the Secretary more discretion in 
     the use of experts from the United States, to clarify that 
     funds that may be used to assist in the establishment of 
     extension services, to delete a requirement for an annual 
     report to Congress, to increase from $10 million to $20 
     million the amount of CCC funds available for the program, to 
     provide for faculty exchanges, and to eliminate unused 
     authority for the establishment of an agricultural fellowship 
     program for students from countries that are parties to the 
     North American Free Trade Agreement; and
       (5) amending subsection (e) to state that a requirement for 
     a report on foreign debt burdens is subject to a limitation 
     of the number of reports required from the Department of 
     Agriculture.
       The bill also amends Section 1543 of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 in Subsection (b), which 
     establishes the Cochran Fellowship Program by adding emerging 
     markets to the list of types of countries that are eligible 
     for the program. (Section 486)
       The Senate amendment is identical except for a technical 
     difference. (Section 268)
       The Conference substitute adopts the House with an 
     amendment striking the $10 million annual increase in 
     funding.
       The Managers find that without a stable food supply, 
     emerging markets are subject to economic instability. 
     Further, the development of agriculture infrastructure and 
     technologies, and agricultural training are critical needs in 
     emerging markets to further growth in the agricultural 
     sector.
       The Managers believe that the President may, where 
     appropriate, utilize existing authorities to transfer 
     agricultural technologies to, and conduct agricultural 
     training for farmers and other agricultural professionals. In 
     using these authorities, the President may consider 
     applications by land-grant colleges that have a demonstrated 
     ability to perform an educational program in emerging 
     democracies. The Managers are further aware of an ongoing 
     attempt to achieve these goals in Latvia, Estonia, and 
     Lithuania by the University of Wisconsin-River Falls, and 
     believe that this institution should be considered for such 
     programs.
       The International Cooperation and Development (ICD) program 
     area has a strong, positive role to play in the achievement 
     of the Foreign Agriculture Service mission. Its contribution 
     is illustrated in its work together with the Emerging 
     Democracies program (renamed emerging markets). The program 
     is ideally suited to design and implement the development, 
     training and technical assistance programs funded by the 
     Emerging Democracies programs. In carrying out these Emerging 
     Democracies programs, ICD draws on and coordinates with the 
     extensive expertise of other U.S. Department of Agriculture 
     agencies, the state and land grant university system, and 
     private agricultural enterprises. This relationship between 
     ICD and others has helped develop a number of outstanding 
     programs that are resulting in many short and long term 
     benefits to the Emerging Democracies Office and the Foreign 
     Agriculture Service.
       The Managers believe that the cooperation of ICD with the 
     Emerging Democracies program should continue, and that the 
     Foreign Agriculture Service and ICD should continue to seek 
     other opportunities to fully draw on the expertise of ICD in 
     achieving the Agency's broadened mission. (Section 277)
     (61) ICD reimbursement for overhead expenses
       The Senate provision amends Section 1542(d) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 and allows 
     the International Cooperation and Development (ICD) program 
     to continue to administer the emerging democracies (now 
     emerging markets) program as it did when it was OICD. Since 
     the ICD merger with the Foreign Agriculture Service, emerging 
     democracy funds cannot be used to pay the salaries of 
     emerging democracy program employees (i.e., Cochran program). 
     The provision allows the Foreign Agriculture Service to 
     transfer not more than $2 million per fiscal year for 
     salaries and expenses for program employees and no funds may 
     be used for the purchase of computers or information 
     technology systems.
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 278)
       The Managers also accepted an amendment requiring the 
     President to continue U.S. membership and participation in 
     the International Cotton Advisory Committee. The Managers 
     have determined that participation in that body by the United 
     States is crucial and should be continued. The President 
     shall ensure that U.S. participation in ICAC is carried out 
     through the Secretary of Agriculture and shall direct the 
     U.S. Department of State to pay the annual dues of the United 
     States to ICAC from its appropriated accounts. The Presidents 
     shall direct the U.S. Department of State to pay the 1996 
     dues in a prompt manner in order to ensure continuity of U.S. 
     participation. (Section 283)
     (62) Labeling of domestic and imported lamb and mutton
       The Senate amendment requires the Secretary, consistent 
     with U.S. international obligations, to establish standards 
     for the labeling of lamb and mutton and be applied equally to 
     domestic and imported product. The standard to be used is 
     based on the break or spool joint method to differentiate 
     lamb from mutton by the degree of calcification of bone to 
     reflect maturity. (Section 876)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment requiring the Secretary to establish standards 
     for the labeling of sheep carcasses, parts of carcasses, 
     meat, and meat food products as `lamb' or `mutton'.
       The Managers intend that consistency between domestic and 
     imported lamb will result. To accomplish this the Secretary 
     is expected to assess the extent to which imported sheepmeat 
     meets the U.S. standard for lamb. Since U.S. and imported 
     lamb maturity determination methods differ, this report 
     should include any recommended changes in lamb labeling 
     regulations. It is expected that this report will include 
     quantitative analysis of the maturity of both domestic and 
     imported sheepmeat in relation to the total amount of 
     sheepmeat sold in the U.S. (Section 279)
     (63) Import assistance for CBI beneficiary countries and the 
         Philippines
       The Senate amendment repeals an obsolete provision for a 
     sugar reexport program for Caribbean countries and the 
     Philippines that was in force only for 1988. (Section 269)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 280)
     (64) Studies, reports, and other provisions
       The Senate amendment repeals requirements from the Food 
     Agriculture, Conservation and Trade Act of 1990 for several 
     reports. (Section 270)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 281)
     (65) Sense of Congress concerning multilateral disciplines on 
         credit guarantees
       The House bill expresses the sense of Congress that, in 
     ongoing negotiations under the auspices of the Organization 
     for Economic Cooperation and Development on credit 
     guarantees, the United States should not agree to changes in 
     U.S. laws authorizing credit guarantees, and should insist on 
     disciplines on the operations of foreign export monopolies. 
     (Section 488)
       The Senate amendment is identical. (Section 272)
       The Conference substitute adopts the House provision with 
     an amendment specifying state trading entities referenced in 
     the resolution. (Section 282)

                        Title III--Conservation

     (1) Definitions
       The Senate amendment defines conservation system as the 
     conservation measures and practices that are approved for 
     application by a producer to a highly erodible field and that 
     provide for cost effective and practical erosion reduction on 
     the field based on local resource conditions and standards 
     contained in the Natural Resources Conservation Service field 
     office technical guide. (Section 301)
       The House bill has no such provision.
       The Conference substitute adopts the Senate position with 
     amendments that: 1) delete the Senate provisions; 2) provide 
     definitions for conservation plans, conservation systems and 
     fields; 3) require the Secretary of Agriculture publish in 
     the Federal Register the current universal soil loss equation 
     and wind erosion equation and publish in the Federal Register 
     any subsequent changes to these equations; 4) require that 
     highly-erodible lands exiting the Conservation Reserve 
     Program not be held to a higher conservation compliance 
     standard than similar cropland in the same area; 5) provide 
     that an individual who violates conservation compliance 
     provisions have a reasonable period, not to exceed one year, 
     to come into compliance; 6) provide for expedited variances 
     for weather, pest, and disease problems and establish a time 
     period for granting those variances; 7) provide for technical 
     requirements in USDA's Field Office Technical Guides with 
     respect to conservation plans and conservation systems; 8) 
     require a measurement of erosion on the field prior to 
     implementation of a conservation system, based on estimated 
     annual erosion rates; 9) provide for residue measurement 
     taking into account residue in the top two inches of soil, 
     technical guidelines for erosion measurement, certification 
     of third party residue measurement, and acceptance and use of 
     residue measurements provided by a producer; 10) provide for 
     a producer's certification of compliance and the Secretary's 
     option for a status review if a producer certifies 
     compliance, and revision or modification of a conservation 
     plan by a producer if the same level of treatment is 
     maintained. The Secretary may not change a producer's 
     conservation plan without concurrence by the producer; 11) 
     provide for technical assistance on all portions of a 
     producer's farm for other conservation objectives outside of 
     the scope of conservation compliance; 12) permit the producer 
     to use practices other than those currently approved if the 
     Secretary determines they have a reasonable likelihood of 
     success; 13) provide for a review, and relief to a producer, 
     by the local county committee if a conservation system would 
     cause undue economic hardship; 14) mandate that an employee 
     of USDA who notices a compliance deficiency on a producer's 
     farm while providing technical assistance on other land 
     inform the producer of the deficiency and actions necessary 
     to come into compliance (The producer must come

[[Page H2813]]

     into compliance within one year); 15) provide that a producer 
     who is violating conservation compliance will not be denied 
     crop insurance benefits, and; 16) make conforming amendments. 
     (Sections 301, 311-316)
       It is the intent of the Managers that the Secretary use the 
     best science available in determining the degree to which the 
     amount of residue in the top two inches of soil is to be 
     considered when estimating average annual soil erosion 
     levels.
       The Managers intend that USDA employees may, at the request 
     of the producer, provide technical assistance on all parts of 
     a producer's operation for soil, water, and related natural 
     resource concerns identified by the producer.
       The Managers intend that the Secretary will establish one 
     standard for conservation systems offered by USDA on all 
     cropland subject to conservation compliance.
       It is not the intent of the Managers that county committees 
     make determinations on the accuracy of a technical 
     determination by NRCS. The scope of the county committees' 
     decision will be whether the technical determination causes 
     undue economic hardship.
       To accomplish NRCS's stated objectives of providing farmers 
     additional conservation alternatives based on local 
     conditions that combine economic and environmental 
     considerations, the Committee urges the Secretary to 
     encourage NRCS to continue and expand, as appropriate, the 
     Wind Erosion Pilot Project, which evaluates the use of 
     primary tillage to create soil roughness conditions for 
     compliance purposes. This includes evaluating the 
     appropriateness of substituting tillage as an alternative to 
     vegetative cover management.
       The Managers expect the Secretary to make it possible for 
     residue measurements to be supplied by producers who self-
     certify. At the same time, the Managers do not intend that 
     the Secretary be required to use producer (or certified third 
     party) supplied residue measurements that the Secretary 
     determines are incorrect or inappropriate for the purpose 
     identified in this paragraph. Rather, it is the intent of the 
     Managers that the Secretary shall use these measurements to 
     the extent the Secretary determines is appropriate.
       The Managers believe that the Secretary should examine and 
     revise, as appropriate, the Department's procedures for 
     providing notice of, and conducting investigations of, 
     possible conservation compliance deficiencies. The Managers 
     understand that existing law requires that, when accepting 
     written allegations of compliance violations, the Secretary 
     must keep the identity of the person filing the allegation 
     confidential if so requested by the person. However, it is 
     critical that the Secretary have the discretion to determine 
     whether to investigate such allegations, recognizing the high 
     degree of sensitivity among farmers and others concerning the 
     propriety of relying on anonymous allegations. The Secretary 
     may initiate or expand any investigation based on such 
     allegations, and should promptly notify the subject of the 
     investigation of the existence and nature of the alleged 
     violation. The Secretary should provide information to the 
     subject of the investigation on the status of the 
     investigation when requested or within 180 days of the 
     initial notification of the investigation. In this notice, 
     the Secretary should also inform the person whether a formal 
     complaint will be issued, when the investigation will be 
     terminated, or whether the investigation will continue or be 
     expanded. In cases where the Secretary determines that a 
     violation has occurred, the subject of the investigation 
     should be notified by registered or certified mail of the 
     violation and be given the appropriate information on the 
     determination and on appeal rights.
       The Managers intend, by using the term ``group of fields'' 
     as part of the definition of a conservation system, that 
     appropriate erosion control conservation practices be applied 
     to highly erodible lands that might constitute a subset of 
     all the land within such a group.
       The Managers expect that the Secretary pay particular 
     attention to areas near weather stations used to establish 
     climatic factors used in making wind erosion predictions. In 
     cases where the Secretary concludes that existing highly-
     erodible land determinations unfairly penalize producers, the 
     Secretary should, to the extent practicable and appropriate, 
     use updated wind erosion data to revise the conservation 
     compliance plan for the affected land of producers who 
     request such relief. The Secretary should caution producers 
     that a voluntary request for a conservation compliance review 
     in an affected county may impact the producer's future 
     eligibility for the Conservation Reserve Program.
     (2) Wetland conservation exemption
       The Senate amendment amends Section 1222(b)(1) of the Food 
     Security Act of 1985 by adding a new exemption from 
     swampbuster penalties for converted wetlands if the extent of 
     the conversion is limited to the reversion to conditions that 
     will be at least equivalent to the wetland functions and 
     values that existed prior to implementation of a voluntary 
     wetland restoration, enhancement, or creation action. 
     (Section 358)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     a technical amendment. (Section 322)
       The Managers intend that the Secretary permit a person to 
     cease to use ``farmed wetlands'' or ``farmed wetlands 
     pasture'' for agricultural purposes, allow them to return to 
     wetland conditions and subsequently bring these lands back 
     into agricultural production after any length of time without 
     violating swampbuster, if: 1) the person first notifies the 
     Secretary of the intent to allow improved wetland conditions 
     to return to the ``farmed wetland'' or ``farmed wetland 
     pasture''; 2) the Secretary documents the specific site 
     conditions prior to the initiation of the wetland 
     improvement; 3) the Secretary approves the subsequent 
     proposed conversion action prior to implementation, and; 4) 
     the subsequent conversion action returns the site to wetland 
     conditions at least equivalent to the functions and values 
     that existed prior to the time the wetland was restored or 
     enhanced. The Managers do not intend for this provision to 
     supersede the wetlands protection authorities and 
     responsibilities of the Environmental Protection Agency or of 
     the Corps of Engineers under Section 404 of the Clean Water 
     Act.
     (3) Abandonment of converted wetlands
       The Senate amendment amends Section 1222 of the Food 
     Security Act of 1985 to require that the Secretary not 
     determine that a prior converted or cropped wetland is 
     abandoned, and therefore that the wetland is subject to 
     swampbuster penalties, on the basis that a producer has not 
     planted an agricultural crop on the prior converted or 
     cropped wetland after the date of enactment of this 
     subsection, so long as any use of the wetland thereafter is 
     limited to agricultural purposes. (Section 364)
       The House bill contains no comparable provisions.
       The Conference substitute adopts the Senate provision with 
     amendments that: 1) provide the Secretary with the discretion 
     to determine which programs a person who violates swampbuster 
     will become ineligible for; 2) assure producers have the 
     right to request a review of, and to appeal, a certified 
     wetland delineation; 3) provide that a certified wetland 
     delineation will remain in effect until the producer requests 
     a new delineation and certification; 4) ensure that wetlands 
     which were certified as prior converted cropland will 
     continue to be considered prior converted wetlands even if 
     wetland characteristics return as a result of lack of 
     maintenance of the land or other circumstances beyond the 
     person's control as long as the prior converted cropland 
     continues to be used for agricultural purposes; 5) require 
     USDA to identify which categories of actions constitute a 
     minimal effect on a regional basis; 6) provide producers who 
     inadvertently convert a wetland greater flexibility to 
     mitigate that loss through restoration, enhancement, or 
     creation of wetlands; 7) allow the Secretary to waive 
     penalties against a producer if the Secretary believes the 
     producer was acting in good faith and did not intentionally 
     violate swampbuster; 8) provide for a pilot program on 
     mitigation banking; 9) repeal the requirement for 
     consultation with the Fish and Wildlife Service; 10) provide 
     that persons affiliated with a person who violates 
     swampbuster will not be penalized if such affiliated persons 
     are not responsible for the violation, and; 11) defines 
     ``agricultural lands'' for purpose of implementing the 
     interagency memorandum of agreement on federal wetland 
     delineations. (Section 321-326)
       The Managers intend that the Secretary should, in 
     determining ineligibility for benefits under swampbuster, 
     take away those program benefits that would not defeat the 
     purposes of encouraging good conservation of our soil and 
     water resources or endanger the ability of a borrower to 
     continue to repay a USDA farm loan. The Managers intend that 
     the amendments to abandonment provisions under swampbuster 
     should not supersede the wetland protection authorities and 
     responsibilities of the Environmental Protection Agency or 
     the Corps of Engineers under Section 404 of the Clean Water 
     Act. The minimal effect amendments are intended by the 
     Managers to assist persons in avoiding a violation of the 
     ineligibility provisions of Section 1221 by identifying types 
     of minor wetland alterations and farming practices that are 
     routinely determined by the Secretary in a given state or 
     region to have minimal impact on wetlands functions and 
     values. The Managers intend, in general, that categorical 
     minimal effects exemptions be developed on a statewide, 
     regional or local basis for categories of specific, normal 
     agricultural practices conducted in specified wetland 
     systems.
       The Managers intend the mitigation banking pilot to 
     determine the usefulness of such mitigation banking in 
     assisting landowners in complying with the mitigation 
     requirements of the Swampbuster provisions. In carrying out 
     such a pilot, the Managers support permitting wetland acres 
     to be entered into the Conservation Reserve Program (CRP) for 
     the purpose of demonstrating the feasibility of agricultural 
     wetlands mitigation. The Managers also support permitting 
     producers to convert the frequently cropped wetlands 
     mitigated under this pilot mitigation banking authority, and 
     to produce an agricultural commodity on the converted acres. 
     To ensure that the mitigation pilot does not diminish wetland 
     resources, the Mangers expect that wetlands that producers 
     may convert under this pilot program should be wetlands which 
     are frequently cropped, and significantly degraded. Further, 
     to offset the loss of wetland functions and values that may 
     result from such conversion, the Committee expects that the 
     Secretary will require producers who are permitted to harvest

[[Page H2814]]

     a crop on a converted wetland mitigated under this pilot 
     program to assign the related CRP payments to a wetland 
     mitigation bank approved by the Secretary.
       The Managers intend the Secretary to determine under what 
     circumstances the Fish and Wildlife Service should be 
     utilized in the implementation of Swampbuster. The Managers 
     intend that the Secretary define ``affiliated person'' so 
     that persons with an insignificant interest will not be 
     considered affiliated.
       For the purposes of the section relating to the Secretary 
     of Agriculture's role under the interagency memorandum of 
     agreement on wetland delineation, ``tree farms'' means farms 
     devoted to the raising of trees designed to be sold whole, 
     such as nurseries, Christmas tree farms and other small tree 
     farms, and does not include large tree farms that are 
     commercially planted, cultivated, and actively managed for 
     the production of wood and wood fiber.
     (4) Environmental Conservation Acreage Reserve Program
       The House bill extends the authorization for ECARP through 
     2002. Protection of wildlife habitat is added as a purpose of 
     ECARP. (Section 304)
       The Senate amendment contains similar provisions including 
     a farmland protection program under which the Secretary is 
     directed to purchase conservation easements or other 
     interests in 170,000 to 340,000 acres of land with prime, 
     unique or other productive soil that is subject to a pending 
     offer from a state or local government to limit non-
     agricultural uses of the land. Funding for the program, from 
     the Commodity Credit Corporation, shall not exceed $35 
     million. (Section 301)
       The Conference substitute adopts the Senate provisions with 
     an amendment to add protection of wildlife habitat as a 
     purpose of ECARP. (Section 331)
       It is the intent of the Managers that the Secretary of 
     Agriculture should, to the fullest extent practicable, 
     recognize the responsibilities and utilize the authorities of 
     state and local governments, including local conservation 
     districts, in achieving the purposes of this section. In 
     particular, Congress intends for the Secretary to acknowledge 
     and maintain the historic role of conservation districts in 
     assessing natural resource priorities, approving site-
     specific conservation plans, and coordinating the delivery of 
     federal conservation programs at the local level.
     (5) Conservation priority areas
       The Senate amendment continues the concept of conservation 
     priority areas within which producers are eligible for 
     enhanced assistance through the Conservation Reserve Program, 
     the Wetlands Reserve Program, and a new Environmental Quality 
     Incentives Program. It adds the Rainwater Basin Region, the 
     Lake Champlain Basin and the Prairie Pothole Region as 
     specific conservation priority areas. (Section 311)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment deleting all mentions of specific regions as 
     conservation priority areas. (Section 331)
       Although the Managers removed the Chesapeake Bay Region, 
     the Great Lakes Region and the Long Island Sound Region from 
     the conservation priority area designation legislation and 
     opted not to include the Rainwater Basin Region, the Lake 
     Champlain Basin and the Prairie Pothole Region, the Managers 
     intend no prejudice against these regions being designated by 
     the Secretary as conservation priority areas in the future.
       In the priority setting process the Managers expect the 
     Secretary to take into consideration any recommendations from 
     State Governors, State agencies, and other Federal 
     Departments or agencies in selecting and designating 
     conservation priority areas.
     (6) Applicability and termination
       The Senate amendment restates current law regarding 
     applicability and termination of conservation priority areas. 
     (Section 311)
       The House bill has no comparable provision
       The Conference substitute adopts the Senate provision. 
     (Section 331)
     (7) Conservation reserve program
       The House bill reauthorizes the CRP through 2002, limits 
     enrollments to 36.4 million acres and provides that CRP funds 
     not spent because of an early contract termination may be 
     spent as rental payments to enroll other eligible land into 
     the CRP. (Section 305)
       The Senate amendment reauthorizes the CRP through 2002, 
     limits enrollments to 36.52 million acres and permits the 
     Secretary to enroll new acreage into the CRP in an amount 
     equal to the acreage covered by those CRP contracts that 
     expire after the date of enactment. (Section 312)
       The Conference substitute adopts the House provisions with 
     an amendment that provides that the Secretary may maintain up 
     to 36.4 million acres in the CRP at any time during the 1986-
     2002 calendar years, including acreage in contracts extended 
     by the Secretary. (Section 332)
       The Managers stress their intent that the 36.4 million acre 
     maximum is a rolling maximum, rather than a program lifetime 
     limit. The Secretary may enroll additional land to replace 
     land leaving the program through early terminations or 
     contract expirations so long as, at any one time, there is 
     not more than 36.4 million acres enrolled.
       The Managers urge the Secretary, when considering the 
     appropriateness of utilizing the Conservation Reserve Program 
     and other voluntary incentive and technical assistance 
     initiatives on an individual farm or ranch, to employ the 
     most cost-effective option or options necessary to address 
     the natural resource challenges posed by the farm or ranch. 
     In many cases, entering entire fields into the CRP will be 
     the most efficacious. However, idling partial fields through 
     the CRP will frequently provide equivalent environmental 
     benefits at a lower cost to the government. Similarly, 
     financial incentives for the employment of land management or 
     structural practices--alone or in combination with land 
     idling--will return substantial environmental dividends 
     economically while allowing agricultural production to 
     continue. By adopting such a balanced approach, the Secretary 
     will maximize the environmental benefits of the various 
     programs per dollar expended.
       It is the intent of the Managers that the Secretary permit 
     flexible widths for vegetative strips beside ditches or 
     waterways, and in sodded waterways and filterstrips, placed 
     in the CRP. The Managers intend for the Secretary, to the 
     extent practicable, to consider local conditions when 
     determining minimum required widths for vegetative strips in 
     the CRP.
       In carrying out the Conservation Reserve Program, the 
     Managers recommend that the Secretary consider allowing 
     biomass production as an acceptable cover crop practice 
     during the period of a contract, provided that no harvesting 
     is allowed until after the contract is completed or 
     terminated.
     (8) Conservation Reserve Program new acreage
       The Senate amendment permits the Secretary to enroll new 
     acreage into the CRP in an amount equal to the acreage 
     covered by those CRP contracts that expire after the date of 
     enactment.
       The House bill contains no comparable provision.
       The Conference substitute adopts the House position, which 
     deletes the Senate amendment.
     (9) Optional contract termination by producers
       The House bill permits persons to unilaterally terminate 
     CRP contracts with reasonable notice to the Secretary, if the 
     contracts were entered into at least 5 years prior to the 
     date of enactment. Filterstrips, waterways, strips adjacent 
     to riparian areas, windbreaks, shelterbelts, land with an 
     erodibility index greater than 15 and other lands of high 
     environmental value are not eligible for early termination. 
     The early termination may become effective 60 days after the 
     person submits notice to the Secretary and the rental payment 
     for the Fiscal Year in which the termination takes place 
     shall be prorated. An owner or operator who opts for a 
     unilateral termination may at a later time be eligible to 
     enroll the land in the CRP. (Section 305)
       The Senate amendment contains no comparable provisions.
       The Conference substitute adopts the House provisions with 
     amendments to include wetlands among those lands the 
     Secretary may determine are not eligible for an early 
     termination and to limit the unilateral termination option to 
     contracts entered into before January 1, 1995. (Section 332)
     (10) Fair market value rental rates
       The House bill provides that rental payments for land 
     entered into the CRP after the date of enactment may not 
     exceed the average fair market rental rate for comparable 
     lands in the county. The provision is not applicable to 
     existing contracts that have been extended. (Section 305)
       The Senate amendment has no comparable provision.
       The Conference substitute adopts the Senate provision, 
     which deletes the House provision. (Section 332)
       The Managers note the provision in the House bill that 
     required rental rates for new enrollments not to exceed the 
     average fair market rental rate for comparable lands in the 
     county in which the CRP lands are located. The Conference 
     substitute did not include this provision. The Managers agree 
     with the Secretary's action for the 13th CRP signup which 
     allowed local review of CRP rental rates prior to the signup 
     period, including authority for limited adjustments. However, 
     the Managers are concerned that in some regions, Farm Service 
     Agency offices did not clearly understand that in areas where 
     share leases predominate, rental rates were to be determined 
     on a cash equivalent basis. Therefore, the Managers expect 
     that, in future CRP enrollments and extensions of CRP 
     contracts, the Secretary will ensure that all county offices 
     are notified that CRP rental rates shall be determined on a 
     cash or cash equivalent basis.
     (11) Enrollments in 1997
       The House bill repeals a requirement in the Fiscal 1996 
     Agricultural Appropriations Act regarding CRP enrollments. 
     (Section 305)
       The Senate amendment contains a similar provision. (Section 
     312)
       The Conference substitute adopts the House provision. 
     (Section 332)
     (12) Wetlands Reserve Program--Enrollment
       The House bill reauthorizes the WRP through 2002 and limits 
     enrollments to no more than 975,000 acres. Total acreage 
     enrolled shall be divided equally between permanent 
     easements, long-term easements (30 years or shorter if 
     required by state law), and cost-share agreements. (Section 
     302)

[[Page H2815]]

       The Senate amendment contains similar provisions with the 
     exception that, beginning October 1, 1996, acreage enrolled 
     shall be divided equally between permanent easements, 30-year 
     easements and restoration cost-share agreements. (Section 
     313)
       The Conference substitute adopts the Senate provisions with 
     an amendment prohibiting the Secretary from entering into any 
     new permanent easements until non-permanent easements are 
     obtained on at least 75,000 acres. (Section 333)
       The Managers do not intend for the restriction on 
     additional permanent easements to prohibit the Secretary from 
     finalizing any agreements that have been entered into with 
     producers through previous WRP signups.
     (13) Eligibility
       The House bill extends the period for eligible lands to be 
     enrolled through 2002. (Section 302)
       The Senate amendment contains similar provisions and a 
     requirement that eligible lands must also maximize wildlife 
     benefits. (Section 313)
       The Conference substitute adopts the Senate provisions. 
     (Section 333)
     (14) Other eligible lands
       The Senate amendment states that other eligible lands must 
     also maximize wildlife benefits. (Section 313)
       The House bill has no similar provision.
       The Conference substitute adopts the Senate provision. 
     (Section 333)
     (15) Easements
       The House bill states that payments may be provided in 
     between 5 and 30 annual installments of equal or unequal size 
     (but may not be in a lump sum). Cost-share payments for 
     permanent easements shall be for 75-100% of eligible costs 
     and those for 30-year easements or cost-share agreements 
     shall be for 50-75% of eligible costs. (Section 302)
       The Senate amendment contains similar provisions and a 
     requirement that restoration plans be made through the local 
     Natural Resources Conservation Service representative in 
     consultation with the State Technical Committee. (Section 
     313)
       The Conference substitute adopts the Senate provisions. 
     (Section 333)
     (16) Cost share and technical assistance
       The House bill states that restoration cost-share 
     agreements may cover 50-75% of eligible costs and specifies 
     that the limitations are not applicable to easements that 
     existed prior to the date of enactment. (Section 302)
       The Senate amendment has similar provisions with the 
     exception of the proviso regarding easements that existed 
     prior to the date of enactment. (Section 313)
       The Conference substitute adopts the Senate provisions. 
     (Section 333)
     (17) Wetlands Reserve Program--Purposes
       The House bill makes no change to the current purpose of 
     the WRP, which is to assist owners of eligible lands in 
     restoring and protecting wetlands.
       The Senate amendment states that the purpose of the WRP is 
     to protect wetlands so as to enhance water quality and 
     provide wildlife benefits while recognizing landowner rights. 
     (Section 313)
       The Conference substitute adopts the House position, which 
     deletes the Senate amendment.
     (18) Environmental Quality Incentives Program--Purpose
       The Senate amendment states that the purpose of the new 
     Environmental Quality Incentives Program is to combine into a 
     single program the functions of the Agricultural Conservation 
     Program, the Great Plains Conservation Program, the Colorado 
     River Basin Salinity Control Program and the Water Quality 
     Incentives Program. (Section 314)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 334)
     (19) Findings
       The Senate amendment states several findings relevant to 
     the establishment of the EQIP program. (Section 314)
       The House bill has no comparable provision.
       The Conference substitute adopts the House position, which 
     deletes the Senate amendment.
     (20) Eligible lands
       The House bill states that land on which EQIP contracts may 
     be entered into includes land used for livestock or 
     agricultural production that the Secretary determines poses a 
     serious threat to soil, water or related resources. (Section 
     301)
       The Senate amendment states that land on which EQIP 
     contracts may be entered into include: agricultural land 
     (including cropland, rangeland, pasture and other land on 
     which crops or livestock are produced) that the Secretary 
     determines poses a serious threat to soil, water or related 
     resources; critical agricultural land as identified in a 
     state plan required under nonpoint source provisions of the 
     Clean Water Act; an area recommended by a state lead agency 
     for protection of soil, water and related resources, and; 
     other land that, if left untreated, could defeat the purposes 
     of EQIP. (Section 314)
       The Conference substitute adopts the Senate provisions with 
     an amendment striking references to critical agricultural 
     land as identified in a state plan required under nonpoint 
     source provisions of the Clean Water Act. (Section 334)
     (21) Definitions--land management practice
       The House bill defines ``land management practice'' as a 
     site-specific nutrient or manure management, integrated pest 
     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. (Section 314)
       The Senate amendment is similar, except that it has no 
     reference to ``site-specific.'' (Section 301)
       The Conference substitute adopts the House provision with a 
     technical amendment. (Section 334)
     (22) Large confined livestock operation
       The Senate amendment defines ``large confined livestock 
     operation'' as an operation that is a confined animal feeding 
     operation and has more than:
       700 mature dairy cattle;
       1,000 beef cattle;
       100,000 laying hens or broilers;
       55,000 turkeys;
       2,500 swine; or
       10,000 sheep or lambs. (Section 314)
       The House bill has no similar provision.
       The Conference substitute adopts the House provision, which 
     deletes the Senate amendment.
     (23) Livestock
       The House bill defines ``livestock'' as mature livestock, 
     dairy cows, beef cattle, laying hens, broilers, turkeys, 
     swine, sheep, lambs and such other animals as determined by 
     the Secretary. (Section 301)
       The Senate amendment has a similar definition with the 
     exception of the term ``mature livestock'' and the provision 
     allowing for a Secretarial determination. (Section 314)
       The Conference substitute adopts the House provisions with 
     amendments striking the word ``mature'' and substituting the 
     word ``cattle'' in place of ``cows.'' (Section 334)
     (24) Producer
       The House bill utilizes the term ``producer'' as a person 
     who is engaged in livestock production, as defined by the 
     Secretary. (Section 301)
       The Senate amendment utilizes the term ``operator.'' 
     (Section 314)
       The Conference substitute adopts the House provision. 
     (Section 334)
     (25) Structural practice
       The House bill defines ``structural practice'' as an animal 
     waste management facility, terrace, grassed waterway, contour 
     grass strip, filterstrip, tailwater pit, or other structural 
     practice that the Secretary determines is needed to protect 
     water, soil, or related resources in the most cost-effective 
     manner, and the capping of abandoned wells. (Section 301)
       The Senate amendment has a similar definition, except that 
     it includes ``permanent wildlife habitat'' and excludes 
     ``tailwater pit'' and ``capping of abandoned wells.'' 
     (Section 314)
       The Conference substitute adopts the House provision with 
     an amendment adding ``permanent wildlife habitat'' and the 
     term ``site-specific.'' (Section 334)
     (26) Establishment and administration of EQIP--Establishment
       The House bill requires that, during the 1996 through 2002 
     fiscal years, the Secretary provide technical assistance, 
     cost-sharing payments, and incentive payments to producers 
     who enter into contracts with the Secretary, through EQIP. 
     (Section 301)
       The Senate amendment contains a similar provision. (Section 
     314)
       The Conference substitute adopts the Senate provision. 
     (Section 334)
     (27) Eligible practices
       The House bill provides that a producer who implements a 
     structural practice shall be eligible for technical 
     assistance, cost-sharing payments, or both. In addition, a 
     producer who performs a land management practice shall be 
     eligible for technical assistance, incentive payments, or 
     both. (Section 301)
       The Senate amendment contains a similar provision except 
     that it also provides for ``education.'' (Section 314)
       The Conference substitute adopts the Senate provision. 
     (Section 334)
     (28) Application and term
       The House bill provides that a contract between a producer 
     and the Secretary under EQIP may apply to 1 or more 
     structural practices or 1 or more land management practices, 
     or both; and 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. (Section 301)
       The Senate amendment contains a similar provision. (Section 
     314)
       The Conference substitute adopts the Senate provision. 
     (Section 334)
     (29) Structural practices
       The House bill requires the Secretary to administer a 
     competitive offer system for producers proposing to receive 
     cost-sharing payments in exchange for the implementation of 1 
     or more structural practices. The competitive offer system 
     shall consist of the submission of a competitive offer by the 
     producer in such manner as the Secretary may prescribe and 
     evaluation of the offer in light of the selection criteria 
     established in section 1238C and the projected cost of the 
     proposal. In addition, if the producer who offers to 
     implement a structural practice is a tenant of the land 
     involved in agricultural production, for the offer to be 
     acceptable, the

[[Page H2816]]

     producer shall obtain the concurrence of the owner of the 
     land with respect to the offer. (Section 301)
       The Senate amendment contains a similar provision with 
     technical differences. (Section 314)
       The Conference substitute adopts the House provision with 
     an amendment requiring the Secretary, to the extent 
     practicable, to provide a process for selecting applications 
     for financial assistance where there are numerous 
     applications for such assistance that present substantially 
     the same level of environmental benefits. The process shall 
     provide for the consideration of a reasonable estimate of the 
     projected cost of the proposal and other factors identified 
     by the Secretary for determining which applications will 
     present the least cost, and the consideration of the 
     priorities established under EQIP and other such factors 
     identified by the Secretary to maximize environmental 
     benefits per dollar expended. (Section 334)
       The Managers intend that, when cost-share assistance is 
     provided, the Secretary encourages open and fair competition 
     by vendors for services and products.
     (30) Land management practices
       The House bill requires the Secretary to establish an 
     application and evaluation process for awarding technical 
     assistance or incentive payments, or both, to a producer in 
     exchange for the performance of 1 or more land management 
     practices by the producer. (Section 301)
       The Senate amendment contains a similar provision. (Section 
     314)
       The Conference substitute adopts the Senate provision with 
     an amendment using the term ``producer'' rather than 
     ``operator.'' (Section 334)
       The Managers urge the Secretary, in carrying out EQIP, to 
     be particularly cognizant of the needs of producers whose 
     lands are exiting the Conservation Reserve Program (CRP). 
     Such consideration will ensure that these lands are eligible 
     to receive EQIP assistance for practices such as conservation 
     tillage in an effort to maximize the conservation and 
     environmental benefits that have accrued under the CRP.
     (31) Cost-sharing, incentive payments, and other payments
       The House bill requires that the Federal share of cost-
     sharing payments to a producer proposing to implement 1 or 
     more structural practices shall not be more than 75 percent 
     of the projected cost of each practice, as determined by the 
     Secretary, taking into consideration any payment received by 
     the producer from a State or local government. A producer 
     shall not be eligible for cost-sharing payments for 
     structural practices on eligible land if the producer 
     receives cost-sharing payments or other benefits for the same 
     land under CRP, WRP or the Environmental Easement Program. 
     The Secretary shall make incentive payments in an amount and 
     at a rate determined by the Secretary to be necessary to 
     encourage a producer to perform 1 or more land management 
     practices. (Section 301)
       The Senate amendment contains similar provisions. (Section 
     314)
       The Conference substitute adopts the Senate provisions with 
     amendments using the term ``producer'' rather than 
     ``operator.'' (Section 334)
     (32) Size limitation
       The Senate amendment states that an operator of a large 
     confined livestock operation shall not be eligible for cost-
     sharing payments to construct an animal waste management 
     facility. (Section 314)
       The House bill contains no similar provision.
       The Conference substitute adopts the Senate provision with 
     an amendment stating that a ``large confined livestock 
     operation'' shall be determined by the Secretary. (Section 
     334)
       The Managers expect that in determining whether an 
     operation is a large confined livestock operation within the 
     meaning of this provision, the Secretary will consider 
     various resource and environmental factors, including 
     regulations promulgated pursuant to the Clean Water Act. The 
     Secretary is expected to specify clearly the factors and 
     considerations involved in developing the requirements for 
     program eligibility and should follow notice and comment 
     procedures. However, the Managers understand that the need to 
     begin implementing the program quickly may initially require 
     the use of interim procedures. In defining large confined 
     livestock operations, the Managers expect the Secretary to 
     take into account needs for maximizing environmental benefits 
     in targeted watersheds affected by animal agriculture, the 
     ability of operations to pay for the cost of animal waste 
     management facilities, the obligations of operations under 
     other environmental authorities, and the particular 
     characteristics of modern livestock operations.
     (33) Technical assistance
       The House bill requires the Secretary to allocate funding 
     under EQIP 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. In addition, the 
     Secretary shall ensure that the process of writing, 
     developing and assisting in the implementation of EQIP plans 
     be open to individuals in agribusiness including but not 
     limited to agricultural producers, representatives from 
     agricultural cooperatives, agricultural input retail dealers 
     and certified crop advisers. The process shall be included in 
     but not limited to programs and plans established under EQIP 
     and any other USDA programs using incentive payments, 
     technical assistance, or cost-share payments. The receipt of 
     technical assistance under EQIP shall not affect the 
     eligibility of the operator to receive technical assistance 
     under other authorities of law available to the Secretary. 
     (Section 301)
       The Senate amendment contains similar provisions. (Section 
     314)
       The Conference substitute adopts the House provisions with 
     an amendment to specify that the provision requiring that 
     non-USDA individuals be allowed to prepare plans for programs 
     other than EQIP applies specifically to USDA conservation 
     programs. (Section 334)
     (34) Modification or termination of contracts
       The House bill permits the Secretary to establish terms of 
     an EQIP contract. (Section 301)
       The Senate amendment permits the Secretary to modify or 
     terminate a contract entered into with an operator if the 
     operator agrees and if the Secretary determines the 
     modification or termination is in the public interest. The 
     Secretary may also terminate a contract if the Secretary 
     determines that the operator violated the contract. (Section 
     314)
       The Conference substitute adopts the Senate provisions with 
     an amendment to use the term ``producer'' rather than 
     ``operator.'' (Section 334)
     (35) Non-federal assistance
       The Senate amendment permits the Secretary to request the 
     services of a state agency dealing with water quality, fish 
     and wildlife, or forestry, or any other governmental or 
     private resource considered appropriate to assist in 
     providing the technical assistance necessary for the 
     development and implementation of a structural practice or 
     land management practice. No person shall be permitted to 
     bring or pursue any claim or action against any official or 
     entity based on or resulting from any technical assistance 
     provided to an operator under EQIP to assist in complying 
     with a federal or state environmental law. (Section 314)
       The House bill contains no similar provision.
       The Conference substitute adopts the Senate provisions with 
     amendments striking the prohibition against claims or action 
     resulting from technical assistance and using the term 
     ``producer'' rather than ``operator.'' (Section 334)
     (36) Evaluation of offers and payments--Regional priorities
       The House bill requires the Secretary, in determining 
     eligibility for land for EQIP, to consider the significance 
     of the water, soil and related natural resource problems and 
     the maximization of environmental benefits per dollar 
     expended. (Section 301)
       The Senate amendment requires the Secretary to provide 
     assistance to operators in a region, watershed or 
     conservation priority area based on the significance of the 
     soil, water and related natural resource problems and the 
     practices that best address the problems. (Section 314)
       The Conference substitute adopts the House provisions. 
     (Section 334)
     (37) Maximization of environmental benefits
       The House bill requires the Secretary, in providing 
     assistance to producers, to consider the significance of the 
     water, soil and related natural resource problems and the 
     maximization of environmental benefits per dollar expended. 
     (Section 301)
       The Senate amendment requires the Secretary to accord a 
     higher priority to assistance and payments that maximize 
     environmental benefits per dollar expended. Prioritization 
     shall be done nationally as well as within specific 
     conservation priority areas, regions or watersheds. The 
     Secretary shall establish criteria for implementation of 
     practices that best achieve relevant conservation goals. 
     (Section 314)
       The Conference substitute adopts the Senate provisions. 
     (Section 334)
     (38) State or local contributions
       The Senate amendment requires the Secretary to accord a 
     higher priority to operators located within areas that state 
     or local governments have provided, or will provide, 
     financial or technical assistance to operators for the same 
     conservation or environmental purposes. (Section 314)
       The House bill has no similar provisions.
       The Conference substitute adopts the Senate provision. 
     (Section 334)
     (39) Priority lands
       The Senate amendment requires the Secretary to accord 
     higher priority to lands on which agricultural production 
     contributes to the potential for failure to meet applicable 
     water quality standards or other federal or state 
     environmental objectives. (Section 314)
       The House bill contains no similar provisions.
       The Conference substitute adopts the House position, which 
     deletes the Senate amendment.
     (40) Duties of operators
       The House bill requires producers to comply with terms 
     required by the Secretary. (Section 301)

[[Page H2817]]

       The Senate amendment stipulates that, to receive assistance 
     under EQIP, operators shall agree: to implement an EQIP plan 
     describing conservation and environmental goals; not to 
     conduct practices that would defeat the purposes of EQIP; to 
     refund any payment and forfeit future payments if in 
     violation of the EQIP contract or upon transferring interest 
     in the land (unless the transferee assumes the obligations of 
     the contract), and; to supply information necessary to 
     determine compliance with the EQIP plan. (Section 314)
       The Conference substitute adopts the Senate provisions with 
     an amendment using the term ``producer'' rather than 
     ``operator''. (Section 334)
     (41) EQIP plan
       The Senate amendment states that an individual EQIP plan 
     shall include (as determined by the Secretary): a description 
     of the farming or ranching operation; a description of the 
     relevant farm or ranch resources related to the conservation 
     and environmental objectives of the plan; a description of 
     the structural or land management practices to be 
     implemented; the timing and sequence for implementing the 
     practices, and; information to enable evaluation of the 
     effectiveness of the plan. (Section 314)
       The House bill contains no similar provisions.
       The Conference substitute adopts the Senate position with 
     an amendment providing general requirements for a plan of 
     operations that shall, to the extent practicable, avoid 
     duplication in the plans required for other similar 
     conservation programs and requirements. (Section 334)
       It is the Managers' intent that the process used to develop 
     EQIP plans be a simplified and flexible approach to assist 
     producers to work toward better resource management. EQIP are 
     not intended to be whole-farm plans.
       The producer should voluntarily submit a conservation plan 
     to the Secretary for approval in order to be eligible for 
     participation in EQIP. The plan may contain an implementation 
     schedule, a description of the structural and management 
     practices, cropping patterns, farm or ranch resources, and 
     other information, as the Secretary determines is necessary, 
     to facilitate the objectives of this provision.
       Producers, on their own initiative, may use any 
     conservation plan developed and required for participation in 
     any other program within the jurisdiction of the Secretary 
     provided the plan is approved by the Secretary for the 
     purpose of EQIP. This is intended to avoid a duplication of 
     planning and to relieve the paperwork burden on producers.
       Since EQIP is a voluntary program, the producers may begin 
     the plan development process, on their own initiative, by 
     analyzing their needs for long-term farm or ranch operations. 
     The producers should assess the areas of their operations 
     that face the most serious problems associated with soil, 
     water and related resources, including grazing lands, 
     wetlands, and wildlife habitat. The producers should identify 
     alternative conservation practices and select the best 
     management practices to meet their needs and the conservation 
     incentives of EQIP. The plan should be designed, to the 
     extent practicable, to help producers comply with local, 
     state, and federal laws.
       In determining the practice or combination of practices 
     appropriate for a particular farm or ranch, the Managers 
     emphasize that the Secretary should use the lowest-cost 
     option or options available. By doing so, the Secretary will 
     be able to assist the greatest number of producers possible 
     and maximize the positive impacts on the environment.
       The legislation does not specifically mention all 
     structural or land management practices that are eligible for 
     funding under EQIP because of the broad gamut of measures 
     that may be appropriate depending on the type of operation, 
     its location and other factors. In addition, it is impossible 
     to predict the evolution of new technologies. Accordingly, 
     the Managers strongly urge the Secretary to make new 
     practices eligible for funding under EQIP as soon as 
     reasonable testing indicates their efficacy. The managers 
     also intend that the term ``site-specific'' refer not only to 
     entire farms or ranches but to discrete locations within an 
     operation.
     (42) Duties of the Secretary
       The Senate amendment requires the Secretary to assist an 
     operator in achieving the goals of an EQIP plan by providing 
     an eligibility assessment of the farming or ranching 
     operation; providing technical assistance in developing and 
     implementing the plan; providing technical assistance, cost-
     sharing payments or incentive payments for practices; 
     providing information, education and training; and by 
     encouraging the operator to obtain assistance from other 
     federal, state, local or private sources. (Section 314)
       The House bill includes no similar provisions.
       The Conference substitute adopts the Senate provisions with 
     an amendment using the term ``producer'' rather than 
     ``operator.'' (Section 334)
     (43) Limitations on payments
       The House bill states that the total amount of cost-sharing 
     and incentive payments paid to a person may not exceed 
     $10,000 for any fiscal year or $50,000 for any multiyear 
     contract, except that the Secretary may exceed the limitation 
     on the annual limit on a case-by-case basis if the Secretary 
     determines that a larger payment is essential. The Secretary 
     shall issue regulations that are consistent with those for 
     receiving market transition payments for the purpose of 
     defining the term `person' and prescribing such rules as the 
     Secretary determines necessary to ensure a fair and 
     reasonable application of the EQIP limitations. (Section 301)
       The Senate amendment contains similar provisions but does 
     not include the exception permitting a waiver of the annual 
     limit. (Section 314)
       The Conference substitute adopts the House provisions with 
     amendments requiring the maximization of environmental 
     benefits per dollar expended and providing for interim 
     administration of EQIP pending promulgation of final 
     regulations, to the extent the existing regulations do not 
     conflict with the provisions of the Conference substitute 
     establishing EQIP, and requiring that payments under an EQIP 
     contract entered into during a fiscal year not be made until 
     the subsequent fiscal year. (Section 334)
     (44) Conservation farm option
       The Senate amendment requires the Secretary to offer 
     eligible owners and operators with contract acreage under 
     Title I who also have entered into a CRP contract the option 
     of entering into a Conservation Farm Option contract for a 
     period of ten years as an alternative to the market 
     transition contract payment. In return, eligible owners and 
     operators shall receive payments that reflect the Secretary's 
     estimate of the payments they would receive over the ten-year 
     period under conservation cost-share programs, the CRP, 
     market transition payments, and loan programs for contract 
     commodities, oilseeds and ELS cotton. CFO contract holders 
     shall agree to forego eligibility to participate in the above 
     programs and comply with a conservation plan consistent with 
     a state plan designed to protect wildlife, improve water 
     quality and reduce soil erosion. (Section 103)
       The House bill contains no similar provisions.
       The Conference substitute adopts the Senate provisions with 
     amendments that reduce estimated outlays under the CFO to 
     $120 million during the seven-year period and delete market 
     transition payments from the payments a producer will receive 
     under a CFO contract. (Section 335)
     (45) Conforming amendments
       The Senate amendment repeals authorizations for the 
     Agricultural Conservation Program, the Great Plains 
     Conservation Program, the Colorado River Basin Salinity 
     Control Program (Section 202(c) of the Colorado River Basin 
     Salinity Control Act), the Rural Environmental Conservation 
     Program, the Agricultural Water Quality Incentives Program, 
     and technical assistance for water resources (Subtitle F of 
     Title XII of the Food Security Act of 1985) are repealed. 
     Various technical amendments are made to reflect the fact 
     that EQIP replaces the functions of many of the repealed 
     programs. (Section 355)
       The House bill contains no comparable provisions.
       The Conference substitute adopts the Senate provisions with 
     an amendment that maintains some provisions of the Colorado 
     River Basin Salinity Control Act. (Section 336)
     (46) Mandatory expenses
       The House bill requires that, for each of fiscal years 1996 
     through 2002, the Secretary shall use the funds of the 
     Commodity Credit Corporation to carry out the Conservation 
     Reserve Program, Wetlands Reserve Program, and the 
     Environmental Quality Incentives Program. (Section 301)
       The Senate amendment contains similar provisions. (Section 
     341)
       The Conference substitute adopts the House provisions. 
     (Section 341)
     (47) EQIP funding
       The House bill requires that, for each of fiscal years 1996 
     through 2002, $200 million of the funds of the Commodity 
     Credit Corporation shall be available for providing technical 
     assistance, cost-sharing payments, and incentive payments. In 
     each year, at least 50% of the EQIP funding shall be targeted 
     to practices relating to livestock production. (Section 301)
       The Senate amendment contains similar provisions with the 
     exception of a proviso that 50% of the EQIP funding shall go 
     for practices relating to livestock production. (Section 314)
        The Conference substitute adopts the Senate provisions 
     with an amendment limiting funding to $130 million in fiscal 
     1996 and $200 million in each of fiscal years 1997-2002. 
     (Section 341)
     (48) Administration--Plans
        The Senate amendment requires the Secretary, to the extent 
     practicable, to avoid duplication in conservation plans 
     required for highly erodible land conservation under subtitle 
     B, CRP, WRP and EQIP. (Section 314)
        The House bill contains no similar provision.
        The Conference substitute adopts the Senate provision. 
     (Section 341)
     (49) Acreage limitation
        The Senate amendment prohibits the Secretary from 
     enrolling more than 25% of the cropland in any county in CRP 
     or WRP. Not more than 10% of the cropland in a county may be 
     subject to an easement acquired under the subchapters. The 
     Secretary may exceed the limitations if the Secretary 
     determines that the action would not adversely

[[Page H2818]]

     affect the local economy of a county and that operators in 
     the county are having difficulties complying with 
     conservation plans implemented under section 1212. The 
     limitations established under this subsection shall not apply 
     to cropland that is subject to an easement under CRP, WRP or 
     the Environmental Easement Program that is used for the 
     establishment of shelterbelts and windbreaks. (Section 314)
        The House bill contains no similar provision.
        The Conference substitute adopts the Senate provision with 
     an amendment deleting the reference to the Environmental 
     Easement Program. (Section 341)
     (50) Tenant protection
        The Senate amendment states that, except for a person who 
     is a tenant on land that is subject to a CRP contract that 
     has been extended by the Secretary, the Secretary shall 
     provide adequate safeguards to protect the interests of 
     tenants and sharecroppers, including provision for sharing, 
     on a fair and equitable basis, in payments under commodity 
     programs (as modified by to highly erodible land and wetland 
     conservation provisions), CRP or WRP. (Section 314)
        The House bill contains no similar provision.
        The Conference substitute adopts the Senate provision. 
     (Section 341)
     (51) Regulations
        The Senate amendment requires that, not later than 90 days 
     after the effective date of this subsection, the Secretary 
     shall issue regulations to implement the changes to CRP and 
     WRP. (Section 314)
        The House bill contains no similar provision.
        The Conference substitute adopts the Senate provision. 
     (Section 341)
     (52) Advance appropriations to CCC
        The Senate amendment permits the Secretary to use the 
     funds of the Commodity Credit Corporation to carry out the 
     Environmental Easement Program, subject to prior 
     appropriations. (Section 314)
        The House bill contains no similar provision.
        The Conference substitute adopts the House position, which 
     deletes the Senate amendment.
     (53) Authority to use outside agencies
        The House bill eliminates authority for the Secretary to 
     use the Fish and Wildlife Service, land grant institutions, 
     county and state committees and other governmental entities 
     in carrying out conservation programs. (Section 303)
        The Senate amendment contains no similar provision.
        The Conference substitute adopts the Senate position, 
     which deletes the provisions of the House bill.
     (54) State Technical Committees
        The Senate amendment amends Section 1261(c) of the Food 
     Security Act of 1985 to add representatives of the following 
     groups to the existing State Technical Committees: 
     agricultural producers, other nonprofit organizations with 
     demonstrable expertise, persons knowledgeable about the 
     economic and environmental impact of conservation techniques 
     and programs, and agribusiness.
        The House bill contains no similar provisions.
        The Conference substitute adopts the Senate position with 
     an amendment that provides for representation on state 
     technical committees of producers, representatives of 
     nonprofit organizations with demonstrable expertise, persons 
     knowledgeable about conservation techniques, and 
     agribusiness, and provides for public notice of, and 
     attendance at, meetings. (Section 342)
     (55) National Natural Resources Conservation Foundation
        The Senate amendment establishes a National Natural 
     Resources Conservation Foundation as a charitable and 
     nonprofit corporation for charitable, scientific, and 
     educational purposes, including:
        (1) promotion of innovative solutions to the problems 
     associated with the conservation of natural resources on 
     private lands, particularly with respect to agriculture and 
     soil and water conservation;
        (2) promotion of voluntary partnerships between government 
     and private interests in the conservation of natural 
     resources;
        (3) to conduct research and undertake educational 
     activities, conduct and support demonstration projects, and 
     make grants to State and local agencies and nonprofit 
     organizations;
        (4) to provide such other leadership and support as may be 
     necessary to address conservation challenges, such as the 
     prevention of excessive soil erosion, enhancement of soil and 
     water quality, and the protection of wetlands, wildlife 
     habitat, and strategically important farmland subject to 
     urban conversion and fragmentation;
       (5) to encourage, accept, and administer private gifts of 
     money and real and personal property for the benefit of, or 
     in connection with, the conservation and related activities 
     and services of the Department, particularly the Natural 
     Resources Conservation Service;
       (6) to undertake, conduct, and encourage educational, 
     technical, and other assistance, and other activities, that 
     support the conservation and related programs administered by 
     the Department (other than activities carried out on National 
     Forest System lands), particularly the Natural Resources 
     Conservation Service, except that the Foundation may not 
     enforce or administer a regulation of the Department; and
       (7) to raise private funds to promote the purposes of the 
     Foundation.
       The amendment authorizes an appropriation to the 
     Department, to be made available to the Foundation, 
     $1,000,000 for each of fiscal years 1997 through 1999 to 
     initially establish and carry out activities of the 
     Foundation. (Sections 331-340)
        The House bill contains no similar provisions.
       The Conference substitute adopts the Senate provisions. 
     (Sections 351-360)
     (56) Forestry
        The Senate amendment amends Section 4 of the Cooperative 
     Forestry Assistance Act of 1978 is amended by striking the 
     provision that terminates the Forestry Incentives Program 
     December 31, 1995. It also amends Section 2405 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 by an 
     authorization for appropriation of such sums as are necessary 
     to carry out the activities of the Office of International 
     Forestry. (Section 352)
        The House bill contains no similar provisions.
        The Conference substitute adopts the Senate provisions 
     with amendments to limit the authorizations for the Forestry 
     Incentives Program and the Office of International Forestry 
     to 2002, to make the authorization for the Office of 
     International Forestry subject to appropriations, and to 
     provide authority for the Secretary to make grants to states 
     under the Forest Legacy Program. (Sections 371, 373, 374)
     (57) Cooperative work for protection, management, and 
         improvement of National Forest System
       The Senate amendment authorizes cooperative work for the 
     protection, management, and improvement of the National 
     Forest System and permits payments for such work to be made 
     from any appropriation of the Forest Service that is 
     available for similar work if reimbursement is made by the 
     cooperator in the same fiscal year. (Section 545)
       The House bill contains no comparable provisions.
       The Conference substitute adopts the Senate provisions. 
     (Section 372)
     (58) CCC Charter Act
       The Senate amendment amends the CCC Charter Act to include 
     conservation functions and programs among the purposes for 
     which the Secretary may utilize the CCC. (Section 355)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provisions with 
     an amendment permitting the use, after January 1, 1997, of 
     CCC funding for conservation and environmental programs 
     authorized by law. (Section 381)
       The Managers stress that this provision is not intended to 
     preclude the Secretary from utilizing the CCC to fund 
     conservation and environmental programs appropriately 
     authorized by law on or before January 1, 1997.
     (59) Floodplain easements
       The Senate amendment amends Section 403 of the Agricultural 
     Credit Act of 1978 to permit the Secretary to purchase 
     floodplain easements. (Section 359)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 382)
     (60) Resource Conservation and Development Program 
         reauthorization
       The Senate amendment reauthorizes the Resource Conservation 
     and Development Program through 2002. (Section 360)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 383)
     (61) Repeal of report requirement
       The Senate amendment rescinds the requirement for the 
     printing of multiple copies of USDA soil surveys. (Section 
     362)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 384)
     (62) Flood risk reduction
       The Senate amendment establishes a flood risk reduction 
     program for fiscal years 1996 through 2002, under which the 
     Secretary may enter into a contract with a producer with 
     contract acreage under title I on a farm with land that is 
     frequently flooded. Under the terms of the contract, with 
     respect to acres that are subject to the contract, the 
     producer must agree to: the termination of any contract 
     acreage; forgo loans for contract commodities, oilseeds and 
     extra long staple cotton; not apply for crop insurance issued 
     or reinsured by the Secretary; comply with applicable 
     wetlands and highly erodible land conservation compliance 
     requirements; not apply for any conservation program payments 
     from the Secretary; not apply for disaster program benefits 
     provided by the Secretary; and refund the payments, with 
     interest, issued under the contract to the Secretary if the 
     producer violates the terms of the contract or if the 
     producer transfers the property to another person who 
     violates the contract. In return, the Secretary shall agree 
     to pay the producer for the 1996 through 2002 crops not more 
     than the projected contract payments under title I, and other 
     savings from appropriated programs. The Secretary shall carry 
     out the program through the CCC. (Section 351)

[[Page H2819]]

       The House bill contains no similar provision.
       The Conference substitute adopts the Senate provisions with 
     a technical amendment. (Section 385)
     (63) Conservation of private grazing land
       The Senate amendment authorizes the Secretary of 
     Agriculture to provide a coordinated technical, educational, 
     and related assistance program to conserve and enhance 
     private grazing land resources. Subject to the availability 
     of appropriations, the Secretary will establish a voluntary 
     program to provide technical, educational, and related 
     assistance to owners and managers of private grazing land and 
     public agencies, through local conservation districts, to 
     enable the landowners, managers, and public agencies to 
     voluntarily carry out activities including: maintaining and 
     improving private grazing land and the multiple values and 
     uses that depend on private grazing land; implementing 
     grazing land management technologies; managing resources on 
     private grazing land, including planning, managing, and 
     treating private grazing land resources, ensuring the long-
     term sustainability of private grazing land resources, 
     harvesting, processing, and marketing private grazing land 
     resources and identifying and managing weed, noxious weed, 
     and brush encroachment problems; protecting and improving the 
     quality and quantity of water yields from private grazing 
     land; maintaining and improving wildlife and fish habitat on 
     private grazing land; enhancing recreational opportunities on 
     private grazing land; maintaining and improving the aesthetic 
     character of private grazing lands; and identifying the 
     opportunities and encouraging the diversification of private 
     grazing land enterprises. There are authorized to be 
     appropriated to carry out this section $20 million for fiscal 
     1996, $40 million for fiscal 1997 and $60 million for fiscal 
     1998 and each subsequent fiscal year. (Section 354)
       The House bill contains no comparable provisions.
       The Conference substitute adopts the Senate provisions with 
     an amendment deleting a specific reference to the Natural 
     Resources Conservation Service in the description of the 
     program. (Section 386)
     (64) Wildlife Habitat Incentives Program
       The Senate amendment authorizes a Wildlife Habitat 
     Incentives Program to promote implementation of various 
     management practices to improve wildlife habitat. The program 
     would receive $10 million in funding annually from the 
     Conservation Reserve Program, with total expenditures of $60 
     million over seven years. (Section 554)
       The House bill contains no comparable provisions.
       The Conference substitute adopts the Senate provisions with 
     an amendment reducing the total funding to $50 million over 
     seven years. (Section 387)
       The Managers intend that the cost-share payments made under 
     WHIP not exceed 75 percent of the total cost to an eligible 
     landowner for developing a wildlife management plan and 
     implementing eligible activities under the plan.
       The Managers intend that the Secretary, in developing a 
     list of approved activities and practices, shall attempt to 
     achieve landowner and public purposes including: 1) upland 
     wildlife management measures; 2) wetland wildlife management 
     measures; 3) threatened and endangered species management 
     measures; 4) fisheries management measures, and; 5) other 
     activities approved by the Secretary.
     (65) Clarification of effect of resource planning on 
         allocation and use of water
       The Senate amendment amends Section 6 of the Forest and 
     Rangeland Renewable Resources Planning Act of 1974 to 
     stipulate that nothing in the section shall limit any right 
     of authority of a state to allocate water flows. The 
     Secretary of Agriculture is prohibited from requiring a 
     restriction of the operation, use, repair or replacement of 
     an existing water supply facility as a condition of the 
     renewal of a right-of-way granted under Section 501 of the 
     Federal Land Policy and Management Act of 1976. (Section 
     557).
       The House bill contains no comparable provisions.
       The Conference substitute adopts the Senate position with 
     an amendment striking the provisions of the Senate amendment 
     and providing for an 18-month moratorium on any Forest 
     Service decision to require bypass flows or any other 
     relinquishment of the unimpaired use of a decreed water right 
     as a condition of renewal or reissuance of a land use permit. 
     The moratorium shall not affect the obligations or the 
     authority of the Secretary to protect public health and 
     safety or to comply with the Endangered Species Act or 
     applicable state law. A task force shall also be appointed to 
     study several issues regarding water rights as they apply to 
     Forest Service activities and report to the Secretary, the 
     Speaker of the House of Representatives and the chairmen of 
     relevant Senate committees within one year. (Section 389)
       The Managers believe that these provisions are required 
     because the Forest Service has recently imposed, or attempted 
     to impose, by-pass flows to achieve the secondary purposes of 
     the National Forests. This contradicts former USDA policy and 
     has raised questions about their statutory authority in this 
     area. Nothing in this section changes current law regarding 
     the allocation of water or rights to the use of water, and 
     the expiration of the moratorium is not intended to be a 
     recognition or grant of authority to the Forest Service for 
     imposition of by-pass flows. Further, the moratorium imposed 
     by this section is not intended to interfere with the ability 
     of the Forest Service to negotiate or comply with 
     requirements of voluntary agreements concerning the use of 
     National Forest lands for water supply facilities. It is also 
     not the intent of this language to interfere with the duties 
     of the Secretary under the Endangered Species Act.
       It is also the intent of the Managers that the Board 
     established in this section will carry out its duties in a 
     professional, non-partisan manner, and that membership on the 
     Board will consist of individuals with expertise in Western 
     water law and public land law.
     (66) Everglades Agricultural Area
       The House bill provides $210 million to the Secretary of 
     the Interior to conduct restoration activities in the 
     Everglades ecosystem, ``which may include acquiring private 
     acreage in the Everglades Agricultural Area including'' the 
     ``Talisman tract'' by December 31, 1999. (Section 507)
       The Senate amendment contains similar provisions except 
     that $200 million is provided to the Secretary of the 
     Interior. (Section 506)
       The Conference substitute adopts the Senate provision with 
     an amendment to provide an additional $100 million, 
     contingent upon land acquisition within the State of Florida. 
     (Section 390)
     (67) Advisory Board on Agricultural Air Quality
       The Senate amendment establishes a board to advise the 
     Secretary of Agriculture on scientific questions relating to 
     airborne particulate matter and gases that may be issues 
     under the Clean Air Act. The board would be comprised of 17 
     members, including the Chief of the Natural Resources 
     Conservation Service, agricultural producers, other 
     representatives of the 6 NRCS regions, and an atmospheric 
     scientist. (Section 551)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provisions with 
     amendments clarifying that interagency oversight coordination 
     required by the Secretary shall be made to the extent 
     practicable. (Section 391)
     (68) Environmental Easement Program
       The Senate amendment reauthorizes the Environmental 
     Easement Program through 2002. (Section 355)
       The House bill contains no comparable provision.
       The Conference substitute adopts the House position, which 
     deletes the Senate amendment.
     (69) Water Bank Program
       The Senate amendment amends Section 1230 of the Food 
     Security Act of 1985 by adding a provision that acreage 
     currently enrolled in the Water Bank Program authorized by 
     the Water Bank Act shall be considered to have been enrolled 
     in the CRP on the date the acreage was enrolled in the Water 
     Bank program. Payments shall continue at the existing water 
     bank rates. (Section 356)
       The House bill contains no comparable provision.
       The Conference substitute adopts the House position, which 
     deletes the Senate amendment.
     (70) Flood water retention pilot projects
       The Senate amendment permits the Secretary to establish 
     pilot projects for 2 years in duration to restore natural 
     water retention areas to control storm water and snow melt 
     runoff within closed drainage systems. Such projects shall 
     provide cost-sharing and technical assistance for the 
     establishment of nonstructural landscape management 
     practices, including agricultural tillage practices and 
     restoration, enhancement, and creation of wetland 
     characteristics. Funding provided by the Secretary shall not 
     exceed $10,000,000 per project and shall be carried out 
     through the CCC. (Section 357)
       The House bill contains no comparable provision.
       The Conference substitute adopts the House position, which 
     deletes the Senate amendment.
     (71) Watershed Protection and Flood Prevention Act amendments
       The Senate amendment amends the Watershed Protection and 
     Flood Prevention Act to include several new priorities for 
     funding, make nonprofit organizations eligible for funding, 
     and authorize the Secretary of Agriculture to accept 
     transfers of funds from other federal departments and 
     agencies to carry out the act. (Section 363)
       The House bill contains no comparable provisions.
       The Conference substitute adopts the House position, which 
     deletes the Senate amendment.
     (72) Fund for dairy producers to pay for nutrient management
       The Senate amendment amends the Agricultural Marketing 
     Agreements Act of 1937 by allowing each milk marketing order 
     to be amended to allow not more than 10 cents per 
     hundredweight to be added to the minimum milk price for the 
     purpose of environmental nutrient management. (Section 501)
       The House bill contains no comparable provision.
       The Conference substitute adopts the House position, which 
     deletes the Senate amendment.

                     Title IV--Nutrition Assistance

     (1) Disqualification of a store or concern from the Food 
         Stamp Program
       The Senate amendment adds new language to the Food Stamp 
     Act to disqualify food

[[Page H2820]]

     stores from participation in the food stamp program if the 
     stores employ a person found, within the last 3 years, to 
     have traded coupons for firearms, ammunition, explosives or 
     drugs or to have trafficked coupons. The Senate amendment 
     also changes existing disqualification laws to require 
     permanent disqualification of a store for a trafficking 
     offense only if the ownership, but not the management, of the 
     store was aware of the disqualifying conduct. (Section 
     401(a))
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments that 1) delete the Senate provision disqualifying 
     a store which has employed a person found, within the last 3 
     years, to have traded coupons for firearms, ammunition, 
     explosives or drugs or to have trafficked coupons, and 2) add 
     a provision permitting a civil money penalty in lieu of 
     disqualification of a store or concern if there has been no 
     more than one prior trafficking violation by store 
     management. (Section 401(a))
     (2) Employment and training in the Food Stamp Program
       The Senate amendment continues the requirement that the 
     Secretary allocate $75 million annually to carry out the 
     employment and training program through fiscal year 2002. 
     (Section 401(b))
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 401(b))
     (3) Authorization of pilot projects in the Food Stamp Program
       The Senate amendment reauthorizes the seven pilot projects, 
     begun in 1981, that pay cash, in lieu of coupons, to 
     households composed entirely of elderly or SSI recipients 
     through fiscal year 2002. (Section 401(c))
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 401(c))
     (4) Outreach demonstration projects in the Food Stamp Program
       The Senate amendment extends the authorization for 
     appropriations through fiscal year 2002 for outreach 
     demonstration projects. (Section 401(d))
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 401(d))
     (5) Authorization for appropriations of the Food Stamp 
         Program
       The Senate amendment extends the authorization for 
     appropriations for the food stamp program through fiscal year 
     2002. (Section 401(e))
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to authorize appropriations for the program 
     through September 30, 1997. (Section 401(e))
     (6) Authorization of Puerto Rico Nutrition Assistance Program
       The Senate amendment requires the payment for the Puerto 
     Rico Nutrition Program block grant of $1.143 billion for 
     FY96, $1.174 billion for FY97, $1.204 billion for FY98, 
     $1.236 billion for FY99, $1.268 billion for FY00, $1.301 
     billion for FY01, $1.335 billion for FY02. (Section 401(f))
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 401(f))
     (7) Funding for American Samoa Nutrition Assistance Program
       The Senate amendment adds a provision to provide that the 
     Secretary may pay to American Samoa not more than $5.3 
     million, each fiscal year, of funds appropriated to carry out 
     the food stamp program to fund a nutrition assistance program 
     through fiscal year 2002. (Section 401(g))
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment requiring the Secretary to fund the American 
     Samoa Nutrition Assistance program at up to $5.3 million 
     annually, beginning October 1, 1995. The amendment also 
     allows the Secretary of Agriculture to provide grants not to 
     exceed $1 million in fiscal year 1996 and $2.5 million in 
     each of fiscal years 1997 to 2002, to establish and carry out 
     community food security projects to better meet the food 
     needs of low-income individuals. (Section 401(g)-(h))
       The Managers note that although the projects must be 
     community-based, applicants with a national or regional scope 
     should be considered for grant awards if they seek to fund 
     appropriate community-based projects in several locations. In 
     addition, applications for projects designed to provide 
     training and technical assistance to entities developing 
     appropriate community food security projects should be 
     considered for grant funding.
       Applicants must be non-profit organizations, but may use 
     all available resources, including those of for-profit 
     entities. Grants are authorized for up to three year periods, 
     acknowledging that new projects or expanding projects may 
     need a planning phase prior to actual implementation of the 
     project.
       Because the projects funded by this grant authority will be 
     community-based and funded substantially by non-federal 
     sources, it is not expected that any one grant should command 
     a significant portion of the total grant authority. The 
     Managers believe there will be many worthy projects applying 
     for grant awards in each of the next 7 years, and expect the 
     Secretary to make many awards each year to the most 
     worthwhile of the grant applicants.
     (8) Commodity Distribution Program; Commodity Supplemental 
         Food Program--Reauthorization
       The Senate amendment amends the Agriculture and Consumer 
     Protection Act of 1973 to authorize the commodity 
     distribution program and the Commodity Supplemental Food 
     Program through fiscal year 2002. (Section 402(a))
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 402(a))
     (9) Commodity Distribution Program; Commodity Supplemental 
         Food Program--Funding
       The Senate amendment authorizes administrative funding for 
     CSFP through fiscal year 2002 and reauthorizes a provision 
     requiring certain amounts of CCC surplus dairy products be 
     transferred to CSFP. (Section 402(b))
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 402(b))
     (10) Commodity Distribution Program; Commodity Supplemental 
         Food Program--Carried-Over Funds
       The Senate amendment requires that 20 percent of any 
     carried over CSFP funds for food be available for program 
     administration. (Up to 20% of the annually appropriated CSFP 
     funds may be used for administration). (Section 402(c))
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 402(c))
     (11) Emergency Food Assistance Program
       The Senate amendment amends the Emergency Food Assistance 
     Act of 1983 to reauthorize the Emergency Food Assistance 
     Program (TEFAP) through fiscal year 2002. (Section 403)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 403)
     (12) Soup Kitchen and Food Bank Program
       The Senate amendment amends the Hunger Prevention Act of 
     1988 to reauthorize the Soup Kitchen and Food Bank Program 
     through fiscal year 2002. (Section 404)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 404)
     (13) National commodity processing
       The Senate amendment amends the Agriculture and Food Act of 
     1981 to reauthorize the National Commodity Processing Program 
     through fiscal year 2002. (Section 405)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 405)
       The Managers declined to adopt a provision that would 
     convert the Model Good Samaritan Food Donation Act (Pub. L. 
     101-610) to federal law, eliminating differences in various 
     state laws and attempting to develop greater opportunity for 
     partnerships between private and non-profit entities involved 
     in feeding programs. While the Managers commend the 
     philanthropic intent of such legislation, the Managers 
     understand possible implications of preempting state laws and 
     acknowledge jurisdictional complications. It was agreed that 
     this subject has ample merit for full Congressional hearings.

                    Title V--Agricultural Promotion


             Subtitle A--Commodity Promotion and Evaluation

       The Senate amendment requires that not more than every 
     three years, or three years after enactment of a program, the 
     Secretary shall require that each industry-funded generic 
     promotion program for agricultural commodities shall provide 
     for an independent evaluation of the effectiveness of the 
     program, which may include an analysis of benefits, costs and 
     the efficacy of promotional and research efforts undertaken 
     by the program and is to be funded from industry assessments 
     and to be made available to the public. The amendment also 
     requires that the Secretary shall provide annually 
     information to the House and Senate Agriculture Committees 
     about the administrative expenses of industry-funded 
     promotion programs. (Section 961)
       The House has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment defining commodity promotion law, containing 
     congressional findings with respect to generic promotion 
     programs, and requiring an independent evaluation of 
     promotion program effectiveness not less than every five 
     years. (Section 501)
       The Managers also accepted an amendment authorizing the 
     Secretary to issue nationwide promotion, research and 
     information orders applicable to agricultural commodity 
     producers, first handlers and others in the marketing chain 
     if appropriate, and importers if assessed under the order. 
     The Secretary is required to publish the proposal for notice 
     and comment, and to issue the proposed order (if agreed to do 
     so) not later than 270 days after publication of the proposed 
     order. Amendments on promotion program evaluations and 
     promotion board funds for conservation purposes were adopted. 
     The

[[Page H2821]]

      Managers also agreed to an amendment requiring the 
     maintenance of records for the Honey Promotion Program by 
     producers. (Section 591)
       In authorizing the establishment of an industry financed 
     generic promotion, research and information program, the 
     Managers adopted provisions to allow the Secretary to grant 
     an annual credit for branded activities to farmer owned 
     cooperatives which engage in such activities. The Managers 
     recognize the important role of farmer-owned cooperatives in 
     carrying-out industry financed generic promotion, research 
     and information activities for and on behalf of their 
     members. The Managers also recognize that in many cases, such 
     cooperative marketing efforts have involved the successful 
     establishment of specific brands for many agricultural 
     products. Further, that producers through their cooperatives 
     have invested and continue to invest significant resources 
     related to market research, promotion and advertising to 
     enhance the sale of the products and improve their income.
       Accordingly, the Managers agree that the Secretary may 
     provide an annual credit for such expenditures which would be 
     deducted from any assessment that would otherwise be required 
     for conducting a generic program authorized under this title. 
     Such contributions and expenditures would be fully documented 
     in order to be eligible for such credit. This would ensure 
     that producers would be able to engage in such cooperative 
     marketing activities without adding to their cost relative to 
     other industry members. (Sections 511-526)


                    Subtitle C--Canola and Rapeseed

       The Senate amendment authorizes the Secretary to issue an 
     order for a canola and rapeseed promotion program upon 
     request of the industry. A Board of fifteen members is 
     established with not more than four producer members of the 
     Board from any one state. The Board may assess producers four 
     cents per hundredweight of canola or rapeseed produced and 
     marketed in a state. In order to achieve industry consensus 
     for a national canola check-off program, states with an 
     existing canola check-off requested and received, a credit of 
     up to two cents per hundredweight. The Secretary shall 
     conduct a referendum among producers during the period ending 
     thirty months after the date the order was issued to 
     determine whether the order was issued to determine whether 
     the order should be continued. (Sections 921-933)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Sections 531-543)


                         Subtitle D--Kiwifruit

       The Senate amendment authorizes the Secretary to issue an 
     order for a kiwifruit promotion program upon request of the 
     industry. The order should be national in scope and not more 
     than one order shall be in effect at any one time. An eleven 
     member kiwifruit board is established composed of six 
     producers, four importers, and one member of the general 
     public. Implementation of the order and rate of assessment is 
     to be set by a two-third vote of a quorum of the Board. The 
     Secretary shall conduct a referendum of kiwifruit producers 
     and importers sixty days prior to effective date of the order 
     and may conduct a periodic referendum at the end of a six-
     year period, at the request of the Board, or if not less than 
     thirty percent of the kiwifruit producers and importers 
     subject to assessment request a referendum. Any change in the 
     order will be determined by a majority vote and will take 
     effect at the end of the marketing year. (Sections 941-954)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment requiring that producers comprise not less than 
     fifty-one percent of the membership of the board. (Sections 
     551-564)


                          Subtitle E--Popcorn

       The Senate amendment authorizes the Secretary to issue an 
     order for a popcorn promotion program upon request of the 
     industry. A Popcorn Board is established that consists of 
     between four and nine members that are selected by the 
     Secretary and have terms of three years. The Board may raise 
     or lower the rate of assessment annually up to a maximum of 
     eight cents per hundredweight of popcorn. These assessments 
     will be used to pay expenses incurred and to cover 
     administrative costs incurred by the Secretary, but may not 
     exceed fifteen percent of the annual revenues of the Board. 
     If the administrative costs incurred by the Secretary exceed 
     ten percent of the annual revenues of the Board, the 
     Secretary will notify the House and Senate Agriculture 
     Committees.
       Sixty days prior to the effective date of the program, the 
     Secretary will conduct a referendum among popcorn processors. 
     The order only becomes effective if approved by a majority of 
     the processors voting, who processed at least fifty-one 
     percent of the popcorn certified. No sooner than three years 
     after the effective date of the order, the Secretary may 
     conduct a referendum on the request of thirty percent or more 
     of the popcorn processors for continuation of the program. 
     (Sections 901-912)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Sections 571-582)

                            Title VI--Credit


                    SUBTITLE A--FARM OWNERSHIP LOANS

     (1) Limitation on direct farm ownership loans
       The Senate amendment provides that U.S. Department of 
     Agriculture (USDA) direct farm ownership loans are available 
     for farmers and ranchers who have operated a farm or ranch 
     for at least 3 years and who--
       are qualified beginning farmers or ranchers with less than 
     10 years farming experience, or
       have not received a previous direct farm ownership loan, or
       have not received a previous direct farm ownership loan 
     more than 10 years before the date that a new direct farm 
     ownership loan would be made.
       The Senate amendment specifies that the time that a 
     borrower has a youth loan under the farm operating loan 
     program does not count toward the number of years of 
     experience for farm ownership loans. A transition rule 
     provides that existing borrowers who have had direct farm 
     ownership loans for less than 5 years can obtain additional 
     direct farm ownership loans for 10 years from the date of 
     enactment of this Title; those existing borrowers who have 
     had direct farm ownership loans for 5 or more years can 
     obtain additional direct farm ownership loans for 5 years 
     from the date of enactment. The Senate amendment also repeals 
     an obsolete provision that farm ownership loans cannot be 
     restricted solely to borrowers who had loans in 1985. 
     (Section 601)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 601)
     (2) Purposes of loans
       The Senate amendment specifies that direct farm ownership 
     loans can be used for (a) buying farm real estate, (b) making 
     capital improvements, (c) paying related loan closing costs, 
     and (d) paying for soil and water conservation and protection 
     on such property. It also specifies that guaranteed farm 
     ownership loans can be used for the same purposes and for 
     refinancing existing debt. The Senate amendment repeals 
     provisions that allowed farm ownership loans to be used for 
     funding recreational uses and facilities and for funding 
     enterprises to supplement farm income. It also repeals the 
     stipulation that farm ownership loans for improvements 
     include non-fossil energy systems.
       The Senate amendment restates preferences in the 
     Consolidated Farm and Rural Development Act, as amended (Con 
     Act).
       The Senate amendment requires that borrowers have, or agree 
     to obtain, hazard insurance on real property acquired or 
     improved with farm ownership loan funds. It also requires the 
     Secretary of Agriculture to determine within 180 days of 
     enactment the appropriate insurance level, including what 
     property should be insured. (Section 602)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that directs that a new farm ownership loan is 
     not to be made after the date that is 180 days after 
     enactment unless the borrower meets the hazard insurance 
     requirement. (Section 602)
       While the bill requires hazard insurance on property 
     acquired by borrowers with USDA farm ownership loan funds, it 
     does not specify the level of insurance that borrowers should 
     obtain. Rather, it is the intent of the Managers that the 
     Secretary of Agriculture should determine the appropriate 
     insurance level and should consider factors such as the 
     nature of the property that is pledged as security for the 
     loan, the value of the security property and the loan amount, 
     the location of a borrower's farming operation, and the costs 
     and availability of hazard insurance. Also, the Secretary 
     should determine what property should be subject to an 
     insurance requirement.
     (3) Soil and water conservation and protection
       The Senate amendment repeals allowing farm ownership loans 
     to be used for funding residents of rural areas to operate 
     small business enterprises and for paying for waste pollution 
     abatement and control projects. (Section 603)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 603)
       The Managers note that while the bill is ending the use of 
     farm ownership loan funds for various nonfarming purposes, 
     such as funding residents of rural areas to operate small 
     business enterprises and for paying for waste pollution 
     abatement and control projects, there are other federal 
     programs available to support such usage, such as those of 
     the Small Business Administration to fund small business 
     activities and USDA's rural development and conservation 
     programs to fund waste pollution projects.
     (4) Interest rate requirements
       The Senate amendment allows a 4 percent interest rate on a 
     direct farm ownership loan that is being made in conjunction 
     with other credit. (Section 604)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that specifies that the interest rate should be 
     not less than 4 percent. (Section 604)
     (5) Insurance of loans
       The Senate amendment clarifies that a loan guaranteed by 
     the Secretary is supported by the full faith and credit of 
     the government. (Section 605)

[[Page H2822]]

       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 605)
     (6) Loan guaranteed
       The Senate amendment states that a loan can be guaranteed 
     for up to 90 percent. It requires a 95-percent guarantee on a 
     loan or that portion of a loan that is for refinancing USDA 
     direct loans. It also allows a 95-percent guarantee on farm 
     ownership loans and farm operating loans made to borrowers 
     who participate in the down payment loan program for 
     beginning farmers and ranchers. (Section 606)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 606)


                      SUBTITLE B--OPERATING LOANS

     (7) Limitation on direct operating loans
       The Senate amendment provides that USDA direct farm 
     operating loans are available for farmers and ranchers who
       are qualified beginning farmers or ranchers with less than 
     5 years farming experience, or
       have not received previous direct farm operating loans, or
       have received a previous direct farm operating loan in 6 or 
     fewer years.
       The Senate amendment specifies that direct farm operating 
     loans are available to borrowers without regard to the number 
     of years they received youth loans. A transition rule 
     provides that existing borrowers who have had direct farm 
     operating loans in 4 or more years can obtain additional 
     direct farm operating loans in 3 additional years. The Senate 
     amendment also repeals the provision that farm operating 
     loans cannot be restricted solely to borrowers who had loans 
     in 1985. (Section 611)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 611)
       It is the intent of the Managers that direct farm operating 
     loans be made available to farmers and ranchers for a maximum 
     of 7 years. These years may be consecutive, nonconsecutive, 
     or a combination of consecutive and nonconsecutive.
     (8) Purposes of operating loans
       The Senate amendment specifies that direct farm operating 
     loans can be made for (a) paying the costs to reorganize the 
     farming or ranching operation; (b) purchasing livestock, 
     poultry, and farm or ranch equipment; (c) paying farm or 
     ranch operating expenses; (d) financing land and water 
     development, use, and conservation; (e) paying loan closing 
     costs; (f) paying to make additions or alterations to comply 
     with occupational safety and health standards; (g) training 
     limited resource borrowers in record keeping; (h) farm 
     management training; (i) refinancing the debt of direct loan 
     borrowers who experience losses caused by a natural disaster 
     or the debt of other borrowers who obtained credit from a 
     source other than the Secretary; and (j) paying family living 
     expenses, and other farm, ranch, or home needs. It also 
     specifies that guaranteed farm operating loans can be used 
     for the same purposes, except for training limited resource 
     borrowers in record keeping, and also for refinancing 
     existing debt.
       The Senate amendment repeals allowing farm operating loans 
     to be used for financing recreational enterprises; financing 
     other enterprises to supplement farm income; paying for 
     developing, constructing, or modifying solar energy systems; 
     funding residents of rural areas to operate small business 
     enterprises; and paying for pollution abatement and control 
     projects.
       The Senate amendment requires that borrowers have, or agree 
     to obtain, hazard insurance on any property acquired with 
     farm operating loan funds. It also requires the Secretary of 
     Agriculture to determine the appropriate insurance level, 
     including what property should be insured. Furthermore, the 
     Senate amendment allows the Secretary discretion in placing 
     funds in a nonsupervised bank account that a borrower can use 
     for farm operating and family living expenses. (Section 612)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments on the hazard insurance requirement to direct that 
     a new farm operating loan is not to be made after the date 
     that is 180 days after enactment unless the borrower meets 
     the hazard insurance requirement and on nonsupervised bank 
     accounts to provide discretion in placing funds in such 
     accounts, restrict the use of loan funds in such accounts for 
     the basic family needs of the borrower and the borrower's 
     immediate family, and to restrict the size of such an account 
     to an amount that is the lesser of 10 percent of the loan, 
     $5,000, or the amount needed to provide for basic family 
     needs for three calendar months. (Section 612)
       As with farm ownership loan funds, the Managers note that 
     while the bill ends the use of farm operating loan funds for 
     various nonfarming purposes, such as funding residents of 
     rural areas to operate small business enterprises and for 
     paying for pollution abatement and control projects, other 
     federal programs are available to support such usage.
       Additionally, while the bill requires hazard insurance on 
     property acquired by borrowers with USDA farm operating loan 
     funds, it does not specifying the level of insurance. It is 
     the intent of the Managers that the Secretary should 
     determine the appropriate insurance level and should consider 
     factors such as the nature of the property that is pledged as 
     security for the loan, the value of the security property and 
     the loan amount, the location of a borrower's farming 
     operation, and the costs and availability of hazard 
     insurance. Also, the Secretary should determine what property 
     should be subject to an insurance requirement.
     (9) Participation in loans
       The Senate amendment repeals the authority to participate 
     in farm operating loans with other lenders. (Section 613)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 613)
     (10) Line-of-credit loans
       The Senate amendment authorizes direct or guaranteed line-
     of-credit operating loans for up to 5 years. It also states 
     that each year in which a borrower takes an advance or draws 
     on the line-of-credit counts as one year of eligibility for 
     farm operating loans. (Section 614)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that specifies that the line-of-credit is to 
     terminate if a borrower does not repay an advance on 
     schedule, unless the Secretary determines that the borrower's 
     failure to pay was due to unusual conditions that the 
     borrower could not control and the borrower will reduce the 
     line-of-credit outstanding balance to the scheduled level at 
     the end of the production cycle, including the marketing of 
     the borrower's agricultural products. The Conference 
     substitute also provides that the line-of-credit loan may be 
     used to finance the production or marketing of an 
     agricultural commodity that is or formerly was eligible for 
     USDA's price and income support programs. (Section 614)
       The line-of-credit authority is being provided as a means 
     to assist farmers and ranchers by allowing operating plans to 
     be established with a set level of funding assured over a set 
     period of years. Thus, the need for borrowers to go through 
     an annual loan application, review, and approval process in 
     multiple years can be avoided. For budget scoring purposes, 
     the Managers intend that the approved amount of a line-of-
     credit loan made under this authority should be treated as 1 
     loan and not as multiple separate loans. The Managers want to 
     emphasize that there is an important point regarding loan 
     eligibility with this provision. Specifically, the maximum 
     number of years a borrower can receive direct farm operating 
     loans is set at 7 in section 611 of this Title. The Managers 
     do not intend for the term of a line-of-credit operating loan 
     to apply to a borrower's 7 years of eligibility. Rather, it 
     is the intent of the Managers that each year that a borrower 
     takes an advance or draws on a line-of-credit loan is to 
     count as 1 year of loan eligibility. For example, if a 5-year 
     line-of-credit direct operating loan is approved and a 
     borrower draws against this line-of-credit in 4 years, then 
     the borrower has used 4 years of direct farm operating loan 
     eligibility. Thus, in this example, the borrower would still 
     be eligible to obtain direct farm operating loans in 3 
     additional years. Furthermore, section 617 of this Title, 
     which is amending section 319 of the Con Act, has limits on 
     the number of years in which a borrower can obtain guaranteed 
     farm operating loans.
       Furthermore, the Managers recognize that unusual 
     circumstances could result in a borrower not repaying an 
     advance or draw on schedule and, as such, do not intend for 
     the line-of-credit to end in the event of those 
     circumstances. For example, a borrower may have a crop that 
     is ready to be harvested but he or she is delayed in 
     harvesting due to wet weather conditions. Also, the borrower 
     may have been able to enter into a contract to sell his or 
     her agricultural products for a higher price if delivery of 
     the products occurs at a date that is after the payment due 
     date. The Managers want to emphasize to the Secretary that 
     this exception authority should be used only in unusual 
     circumstances and should not become the standard mode of 
     operation, and that USDA needs to closely monitor borrowers 
     who are granted an exception to ensure that they meet their 
     debt obligations.
     (11) Insurance of operating loans
       The Senate amendment repeals the authority to insure farm 
     operating loans. (Section 615)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 615)
     (12) Special assistance for beginning farmers and ranchers
       The Senate amendment repeals the special assistance program 
     for beginning farmers and ranchers. (Section 616)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 616)
     (13) Limitation on period for which borrowers are eligible 
         for guaranteed assistance
       The Senate amendment restates the Con Act limitation on 
     receiving guaranteed farm operating loans after 15 years of 
     direct or guaranteed loans. It also modifies the transition 
     rule to provide that borrowers who, as

[[Page H2823]]

     of October 28, 1992, had a direct or guaranteed loan in 10 or 
     more years can obtain guaranteed farm operating loans in 5 
     additional years after October 28, 1992. (Section 617)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 617)


                      SUBTITLE C--EMERGENCY LOANS

     (14) Hazard insurance requirement, credit elsewhere test, and 
         linking emergency loans to natural disasters
       The Senate amendment requires that borrowers needed to have 
     had hazard insurance on the property damaged or destroyed by 
     a natural disaster as a condition for getting USDA emergency 
     disaster loan assistance. It also requires the Secretary of 
     Agriculture to determine the appropriate insurance level 
     including what property should have been insured. (Section 
     621)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments that (1) direct that an emergency loan is not to 
     be made after the date that is 180 days after enactment 
     unless the applicant met the insurance requirement, (2) 
     revise a current provision to allow the Secretary to waive 
     the credit elsewhere test for emergency loans of $100,000 or 
     less, and (3) modify another current provision to 
     specifically tie emergency loans for changes in crop or 
     livestock operations to natural disasters. (Sections 621-623)
       As a measure of protection for the farm loan portfolio, 
     individuals must have had hazard insurance on property 
     damaged or destroyed as a condition for getting emergency 
     disaster loan assistance. The Managers intend that the 
     Secretary determine what property should have had insurance 
     coverage. The Managers expect that property subject to this 
     requirement would include, but not be limited to, farmland, 
     buildings and other structures, equipment, livestock, crops, 
     and other farm items.
     (15) Maximum emergency loan indebtedness and date for 
         emergency loan security valuation
       The Senate amendment establishes a maximum emergency 
     disaster loan indebtedness at $500,000. (Section 622)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that revises a current provision to require 
     assets used as collateral for an emergency loan to be valued 
     as of the day prior to the disaster. (Sections 624 and 625)
     (16) Insurance of emergency loans
       The Senate amendment repeals the authority to insure 
     emergency disaster loans. (Section 623)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 626)


                  SUBTITLE D--ADMINISTRATIVE PROVISIONS

     (17) Temporary authority to enter into contracts and use of 
         collection agencies
       The Senate amendment authorizes the Secretary of 
     Agriculture to use private collection agencies to attempt 
     collections on delinquent accounts when agency officials 
     determine such usage to be appropriate. (Section 631)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that allows the Secretary of Agriculture to 
     contract through September 30, 2002, with an eligible lending 
     institution for the purpose of servicing the farm loan 
     portfolio, including entering into a pilot project or 
     projects for such servicing, and requires the Secretary to 
     report annually to the Congress on the results of such 
     contracting. (Sections 631 and 632)
       The Secretary is being authorized to use private collection 
     agencies to attempt collections on delinquent accounts, when 
     USDA officials determine such usage to be appropriate, 
     because of concerns that the Department is not making the 
     fullest effort to recover on all such accounts. The General 
     Accounting Office (GAO) has reported a series of deficiencies 
     in this area. Also, while the Congress passed a bill in 1994 
     authorizing USDA to use private attorneys to help resolve 
     delinquent accounts, USDA officials have made little use of 
     such attorneys even though the agency continues to have 
     thousands of delinquent borrowers who owe billion of dollars 
     on their delinquent loans.
       Additionally, the Managers understand that the Secretary 
     currently has available and uses discretionary authority to 
     contract for certain loan servicing activities, such as 
     appraisals of farm property. The Managers encourage the 
     Secretary to continue to use the current authority and also 
     to use the new authority that is being provided to contract 
     for additional loan servicing activities. One or more pilot 
     projects involving servicing of the farm loan portfolio may 
     prove of considerable benefit to the Department; in addition 
     to having the farm loan accounts of more than 100,000 
     borrowers to service, USDA also has to process and approve 
     new farm loan applications and to manage and dispose of farm 
     inventory properties.
     (18) Notice of Loan Service Programs, Borrower Statements, 
         Borrower Reviews, Veterans Preference, and Verification 
         of Credit Elsewhere Test
       The Senate amendment reduces the mandated time frame for 
     notifying delinquent borrowers of available loan servicing 
     options to 90 days after a loan payment is due. (Section 632)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments that (1) require statements submitted by borrowers 
     should be appropriate written financial statements; (2) 
     require the appropriate USDA county or area committee to 
     certify in writing that an annual review of the credit 
     history and business operation of a borrower has been 
     performed and that a review has been made of the continued 
     eligibility of the borrower for the loan; (3) extend veterans 
     preference for loans to cover veterans of any war involving 
     the United States; and (4) allow the Secretary of Agriculture 
     to submit to lenders, without borrower approval, a prospectus 
     of a borrower to verify that the borrower cannot receive 
     credit elsewhere and require the Secretary to notify a 
     borrower when a prospectus is provided to lenders. (Sections 
     633-637)
     (19) Sale of property and easements on inventoried properties
       The Senate amendment modifies guidance on disposing of farm 
     inventory properties. It requires the Secretary to offer to 
     sell farm inventory property, except for any located on an 
     Indian reservation, as follows:
       to qualified beginning farmers and ranchers at current 
     market value within 75 days of taking farm property into 
     inventory and
       if an acceptable offer is not received by the 75th day, 
     within 30 days to the highest bidder, and if no acceptable 
     bid is received, by negotiated sale for the best price 
     obtainable.
       The Senate amendment provides that if more than one 
     qualified beginning farmer or rancher offers to purchase a 
     property, the Secretary is required to select between the 
     qualified applicants on a random basis. It stipulates that 
     the results of the Secretary's random selection is not 
     appealable.
       The Senate amendment also provides that farm properties in 
     inventory that are leased are to be offered for sale 
     according to this pattern within 60 days after the current 
     lease expires. Farm properties in inventory that are not 
     leased are to be offered for sale according to this pattern 
     within 60 days of enactment.
       The Senate amendment provides that farm properties are not 
     to be leased. An exception provides that the Secretary may 
     lease or contract to sell a farm property to a beginning 
     farmer or rancher if the person qualifies for a credit sale 
     or a direct farm ownership loan but credit sale authority for 
     loans or direct farm ownership loan funds are not available. 
     In determining the rental rate to be charged to a beginning 
     farmer or rancher, the Senate amendment requires the 
     Secretary to take into consideration the income producing 
     capability of the property during the term that the property 
     is leased.
       The Senate amendment requires the Secretary to provide for 
     an expedited, higher-level review of a local decision that 
     denies an applicant's eligibility as a beginning farmer or 
     rancher for acquiring a farm inventory property if the person 
     requests a review. It stipulates that the results of such a 
     review shall not be appealable by the applicant. The Senate 
     amendment also requires that the Secretary accumulate 
     statistics on the extent of such review requests, including 
     the results of such reviews, and if those reviews adversely 
     impact on selling farm inventory property to beginning 
     farmers and ranchers and disposing of properties from 
     inventory.
       Furthermore, the Senate amendment provides that real 
     property located on an Indian reservation and pledged as 
     security for a farm loan can be transferred to the Department 
     of the Interior or to the tribe that has jurisdiction over 
     the reservation rather than USDA foreclosing and taking the 
     property into inventory if a borrower defaults. (Section 
     633).
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendment that specifies that the transfer of loan security 
     property to Interior or to an Indian tribe applies to 
     property pledged as collateral by an Indian borrower-owner. 
     The Conference substitute also modifies current guidance on 
     the placing of wetland conservation easements on USDA's farm 
     inventory property to prohibit the Secretary of Agriculture 
     from establishing perpetual conservation easements on land 
     that was cropland at the time it entered the inventory or 
     that was used for farming within five years of the date that 
     it entered inventory. (Sections 638 and 639)
       Changes are being made to the real property disposal 
     provisions in the Con Act in order to provide beginning 
     farmers and ranchers with the first opportunity to acquire 
     the properties and to expedite the disposal of farm inventory 
     properties from USDA's inventory, which will in turn reduce 
     the substantial expense that the Department incurs in 
     managing these properties. Also, competitive sales could 
     result in increased revenues, which would offset prior loan 
     losses. While the bill requires the Secretary to expedite the 
     sale of farm inventory property, the Managers recognize that 
     the Secretary may be delayed in offering property for sale if 
     such property has been or is suspected of having been 
     contaminated by a hazardous material as defined in 
     appropriate federal environmental legislation. Such delay in 
     offering farm properties for sale shall be limited to the 
     time absolutely necessary to identify and resolve any 
     contamination issues in accordance with applicable

[[Page H2824]]

     federal law. The Managers also recognize that the Secretary 
     may be delayed in offering farm inventory property for sale 
     in order to determine whether to place an easement on such 
     property or to transfer such property in accordance with 
     section 354 of the Con Act. It is the position of the 
     Managers that such delays should generally be limited to not 
     more than 60 days. Also, if USDA acquires a farm property 
     that has an existing easement for conservation or other 
     purposes, the easement should remain on the property when it 
     is sold.
     (20) Definitions 3
        The Senate amendment changes one part of the definition of 
     a qualified beginning farmer or rancher for farm ownership 
     loan eligibility by increasing to 25 percent the amount of 
     land that a person may own. It also provides that the owned-
     acreage provision does not apply to farm operating loan 
     eligibility.
        The Senate amendment defines ``debt forgiveness'' as 
     reducing or terminating a farm loan in a manner that results 
     in a loss through (a) write-downs or write-offs under the 
     restructuring process, (b) write-offs under the debt 
     settlement process, (c) loss payments on guaranteed loans, 
     and (d) discharges of debt as a result of bankruptcy. 
     (Section 634)
        The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 640)
     (21) Authorization for loans and contracts on loan security 
         properties
        The Senate amendment provides loan authorization levels 
     for the fiscal year 1996-2002 period. It specifies the 
     portion of the direct farm ownership and operating loans that 
     are reserved during each year for qualified beginning farmers 
     and ranchers. It also provides that these funds are reserved 
     until September 1st of each fiscal year.
        The Senate amendment modifies a current provision in the 
     Con Act by reserving a portion of the available guaranteed 
     farm ownership and operating loans during each year for 
     beginning farmers and ranchers. It stipulates that these 
     funds are reserved until April 1st of each fiscal year.
        Additionally, the Senate amendment modifies a current 
     requirement concerning the transfer of unobligated loan funds 
     to provide that available unsubsidized guaranteed operating 
     loan funds shall be transferred on and after August 1 of any 
     fiscal year to the direct farm ownership loan program for 
     funding approved down payment loans. It provides that funds 
     are to be transferred on and after September 1 for funding 
     approved farm ownership loans to beginning farmers and 
     ranchers. Furthermore, the Senate amendment provides that 
     available emergency disaster loan funds may be transferred on 
     and after September 1 to fund the credit sale of farm 
     inventory property. The Senate amendment is specifying that 
     any transfer of funds under this authority is to be limited 
     so that all guaranteed farm operating loans and emergency 
     disaster loans that have been approved, or will be approved, 
     during a fiscal year will be made to the extent of 
     appropriated amounts. (Section 635)
        The House bill has no comparable provision.
        The Conference substitute adopts the Senate provision with 
     an amendment that targets 60 percent of the direct farm 
     ownership loan funds reserved for beginning farmers and 
     ranchers to those who participate in the down payment loan 
     program. The Conference substitute also modifies current 
     guidance covering easements on loan security property to 
     provide that rather than placing easements on such 
     properties, the Secretary is authorized to enter into 
     contracts with borrowers for conservation, recreation, and 
     wildlife purposes. (Sections 641 and 642)
        The bill is targeting USDA's farm loan funds to beginning 
     farmers and ranchers and requiring that if a qualified 
     beginning farmer or rancher applies for direct farm ownership 
     loan funding through the regular or the section 310E down 
     payment loan program, then the Secretary is to fund the 
     person through the program under which the person applies for 
     funding, providing that he or she meets the eligibility 
     criteria and funds are available. Thus, if a qualified 
     beginning farmer or rancher seeks assistance under the down 
     payment program and if funds are available, the Secretary is 
     to fund the person under that program. It is the intent of 
     the Managers that the applicant decide whether or not to 
     participate in the down payment program.
     (22) List of certified lenders and inventory property 
         demonstration project
        The Senate amendment replaces outdated references to the 
     Farmers Home Administration and updates a requirement 
     concerning maintaining a listing of commercial lenders who 
     participate in the guaranteed farm loan program. It also 
     deletes an expired demonstration project covering inventory 
     property of the Farm Credit System.
        The Senate amendment also extends the authority to make 
     guaranteed farm loans at subsidized interest rates under the 
     interest rate reduction program through fiscal year 2002. 
     (Section 636)
        The House bill has no comparable provision.
        The Conference substitute adopts the Senate provision but 
     deletes the interest rate reduction change since the 
     extension of this program was enacted with the passage of 
     P.L. 104-105 on February 10, 1996. (Section 643)
     (23) Homestead property
        The Senate amendment reduces the time period for borrowers 
     to apply for homestead property to within 30 days from 
     acquisition by the Secretary of Agriculture, or to within 30 
     days of enactment for property in inventory. It also changes 
     the time period for notifying borrowers of homestead rights 
     to the date the Secretary acquires the property, or to within 
     5 days of enactment for property in inventory. (Section 637)
        The House bill has no comparable provision.
        The Conference substitute adopts the Senate amendment. 
     (Section 644)
        The Managers want to emphasize that these changes do not 
     preclude former owners from reacquiring homestead property; 
     rather, the changes reduce the time frame for USDA to notify 
     former owners of their homestead rights and for the former 
     owners to apply for the property. These revisions are being 
     made to conform to the changes being made in the disposal of 
     farm inventory properties including the targeting of such 
     properties to beginning farmers and ranchers. The shortened 
     timeframes for notification and for former owners to apply 
     for the homestead portion of the properties will facilitate 
     the disposal of farm properties from inventory. In addition, 
     in advertising real property for sale under section 335 of 
     the Con Act, as revised by this Title, the Managers expect 
     the Secretary to provide notice that a portion of a property 
     may be subject to the homestead preservation rights of the 
     former owner.
     (24) Restructuring
        The Senate amendment revises the restructuring calculation 
     to provide a restructured borrower with a cash flow margin of 
     up to 10 percent. It provides that the obligations of a 
     borrower who does not qualify to be restructured shall 
     terminate if the person makes a payment equal to the current 
     market value of loan security property. It also repeals 
     requiring recapture agreements with borrowers who buy out 
     their debt obligations at current market value and deletes an 
     exception that allows certain borrowers who acted in ``bad 
     faith'' to be eligible to obtain buy-outs.
        The Senate amendment also repeals the provision that calls 
     for the creditworthiness of a borrower whose loan obligations 
     have been restructured to be determined without regard to the 
     restructuring. (Section 638)
        The House bill has no comparable provision.
        The Conference substitute adopts the Senate amendment. 
     (Section 645)
        The mandated restructuring process is being revised to 
     increase the cash flow margin (income to expenses) of 
     restructured borrowers so as to place them in a more 
     financially viable position following the completion of 
     restructuring and, thus, to increase their chances for 
     success. Prior to the 1990 Farm Bill, a borrower qualified 
     for restructuring when projected income met projected 
     expenses. Because many of the borrowers who were restructured 
     were financially weak following the restructuring, with low 
     cash flows and high debt-to-asset ratios, the 1990 Farm Bill 
     provided for additional relief through a 5-percent debt 
     service margin. However, it is now apparent that this 
     adjustment was not sufficient to put restructured borrowers 
     in a financially viable position. This is reflected in the 
     fact that thousands of borrowers have defaulted again after 
     being restructured; some have then had additional 
     restructuring, others bought out at the net recovery value, 
     and others went through debt settlement.
        The guidance on the termination of loan obligations for 
     borrowers who do not qualify for restructuring is also being 
     changed to provide that the person should make a payment to 
     the Secretary that equals the current market value of loan 
     security property and to end the requirement that such 
     borrowers enter into recapture agreements covering any 
     subsequent disposal of property. These changes were proposed 
     by the Administration in its Farm Bill proposals as a way to 
     receive a higher portion of the unpaid debt and to reduce its 
     administrative costs by not having to monitor recapture 
     agreements. In addition, the Managers believe that borrowers 
     who did not act in good faith with the terms and conditions 
     of their loan agreements with USDA should not benefit from 
     USDA's servicing of their delinquent debts. Thus, a ``bad 
     faith'' exception in the Con Act is being ended.
        Furthermore, another current provision that provides that 
     a borrower's future creditworthiness is to be determined 
     without regard to restructuring is being stricken. It is the 
     intent of the Managers that future credit decisions should 
     take into consideration, among things such as cash flow and 
     loan security, a borrower's credit history, including the 
     results of a debt servicing action that causes farm loans to 
     be written down, written off, or discharged through 
     bankruptcy.
     (25) Transfer of inventory land for conservation purposes
        The Senate amendment removes a provision that prohibits 
     the Secretary of Agriculture from requiring reimbursement 
     when transferring real property for conservation purposes to 
     other federal or State agencies. It also provides for public 
     notices and a public meeting prior to a real property 
     transfer, and consultation with state and local officials. 
     (Section 639)
        The House bill has no comparable provision.

[[Page H2825]]

        The Conference substitute adopts the Senate amendment. 
     (Section 646)
        The Managers note that the Secretary is not being required 
     to be reimbursed when transferring properties to other 
     agencies. The phrase ``without reimbursement'' is being 
     deleted because it is not necessary.
     (26) Implementation of target participation rates
       The Senate amendment requires that the Secretary ensure 
     that targeting loan funds to members of socially 
     disadvantaged groups complies with the Supreme Court's June 
     12, 1995, ruling in Adarand Constructors v. Pena. (Section 
     640)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate amendment. 
     (Section 647)
     (27) Delinquent borrowers, short form certification 
         requirement, and credit study
       The Senate amendment requires that a borrower pay a portion 
     of the interest that is due as a condition of rescheduling or 
     reamortizing loans that are not serviced under a mandated 
     servicing process; the Secretary is to determine the required 
     payment level.
       The Senate amendment prohibits direct operating loans to 
     borrowers who are delinquent on existing farmer program 
     loans. It also prohibits direct and guaranteed loans to 
     borrowers whose defaults on farmer program loans resulted in 
     debt forgiveness. An exception provides that direct or 
     guaranteed farm operating loans for paying annual farm or 
     ranch operating expenses may be made to a borrower who was 
     restructured with debt write-down.
       The Senate amendment limits a borrower to not more than one 
     instance of debt forgiveness under any delinquent debt 
     servicing mechanism that results in USDA incurring direct 
     loan losses.
       Furthermore, the Senate amendment requires that the 
     Secretary perform a study on the demand for and availability 
     of credit in rural areas for agriculture, rural housing, and 
     rural development. (Section 641)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that requires the Secretary of Agriculture to 
     develop a short form for borrowers to use for certifying 
     compliance with loan making statutes and regulations. 
     (Sections 648-650)
       The Managers are concerned that USDA is rewriting loans 
     several times without having borrowers make any payments. GAO 
     has reported that borrowers who are having difficulties or 
     are unable to make their loan payments, but who have not been 
     subjected to the mandated servicing provisions of the Con 
     Act, are having their farm loans rewritten with revised 
     interest rates, payment terms, and the combining of unpaid 
     interest with outstanding principal. Also, the loans that are 
     rewritten in this manner are not subject to the Con Act's 
     total indebtedness limits. While such rewriting may appear to 
     be a benefit to borrowers, in the long-run it is not because 
     the capitalizing of unpaid interest erodes the equity that 
     the borrowers have in their farm operations. It is the 
     position of the Managers that USDA should use its loan-
     servicing tools to assist borrowers who are having difficulty 
     in making their loan payments. However, limits are needed on 
     the extent of that assistance to ensure that borrowers do not 
     become so weak that they end up in an insolvent position and 
     to ensure that the taxpayers' investment in these loans is 
     better protected. Therefore, the bill requires that a 
     borrower who has not requested servicing consideration in 
     response to the formal notification under section 331D of the 
     Con Act has to pay a portion of the interest that is due as a 
     condition of having his or her loans rescheduled or 
     reamortized. The Secretary is to determine the level of 
     payment required from such borrowers.
       The Managers are also concerned about the fiscal soundness 
     of making farm operating loans to delinquent borrowers. 
     According to GAO, a total of $130 million in direct farm 
     operating loans was made to delinquent borrowers from fiscal 
     year 1989 through the first half of fiscal year 1995. GAO has 
     recommended that such loans be prohibited, and the 
     Administration in its Farm Bill proposals also called for 
     deleting this requirement. The Managers concur.
       The bill is also generally prohibiting direct and 
     guaranteed loans to borrowers whose prior defaults on farmer 
     program loans resulted in debt forgiveness. GAO has 
     recommended that borrowers whose prior loan defaults resulted 
     in losses should be prohibited from receiving additional 
     loans. The Administration in its Farm Bill proposals also 
     called for prohibiting loans to borrowers who received debt 
     write-offs through buy-outs and debt settlements. However, 
     the Administration's proposal called for continuing to make 
     loans to borrowers who received write-down, and it did not 
     address lending to borrowers who defaulted on guaranteed 
     loans. Subsequently, USDA officials agreed that borrowers who 
     default on guaranteed loans that result in losses should also 
     be prohibited from additional government-supported farm 
     loans.
       The Managers want to emphasize that the prohibition on new 
     loans applies to borrowers who caused USDA to incur losses at 
     any time prior to enactment of this Title as well as those 
     who cause USDA to incur losses on or after enactment.
       The Managers, however, recognize that borrowers who are 
     restructured with debt write-down under section 353 of the 
     Con Act and, as such, who remain USDA clients may have 
     difficulty in obtaining credit from sources other than USDA 
     since much, and possibly all, of their farm assets may be 
     pledged as security for the restructured loans. Thus, 
     borrowers whose debt is restructured with write-down will be 
     able to obtain farm operating loans to pay their annual farm 
     or ranch operating expenses. Specifically, the Managers 
     intend that funding is to be allowed only for purchasing 
     seed, feed, fertilizer, insecticide, and farm or ranch 
     supplies and to meet other essential farm or ranch operating 
     expenses, including cash rent.
       The bill is also limiting a borrower to no more than one 
     instance of debt forgiveness under any delinquent debt 
     servicing mechanism that results in USDA incurring direct 
     loan losses. A 1990 Farm Bill amendment to the Con Act limits 
     borrowers whose delinquent debts are resolved through the 
     restructuring process to either one write-down when 
     restructured or one write-off when buying out. The one-time 
     limitation added by the 1990 Farm Bill applies to new 
     applications for restructuring that were submitted after the 
     enactment date of that act. The 1990 Farm Bill limitation 
     does not apply to borrowers whose accounts are resolved 
     through the debt settlement process. Information from GAO 
     indicates that some borrowers who have had debt relief when 
     their delinquent debts were resolved through the 
     restructuring process subsequently had additional debt relief 
     when they went through the debt settlement process. There are 
     also other ways in which borrowers can have multiple 
     instances of debt relief. For example, borrowers who go 
     through debt settlement and who received subsequent loans can 
     receive additional debt relief if they default on the new 
     loans and their accounts are restructured with debt write-
     down or bought out with write-off. Also, borrowers can 
     receive more than one debt settlement, each with write-off.
       To ensure that all delinquent borrowers are treated equally 
     and to provide for better protection of the taxpayers' 
     investment in the farm loans, the bill is limiting borrowers 
     whose accounts are resolved through any of the three 
     mechanisms to one instance of debt relief. The Managers want 
     to emphasize that the limitation on debt forgiveness applies 
     to borrowers who had debt forgiveness at any time prior to 
     enactment of this Title as well as those who had debt 
     forgiveness on or after enactment.
       The Secretary of Agriculture is being required to perform a 
     study on the demand for and availability of credit in rural 
     areas for agriculture, rural housing, and rural development 
     and to report on the results of this study to the Senate and 
     House Agriculture Committees. The purpose of the study and 
     report is to ensure that Congress has current and 
     comprehensive information as it continues to deliberate on 
     the credit needs of rural America and the availability of 
     credit to satisfy those needs. In completing this study, the 
     Managers expect the Secretary to use, among other things, 
     data and information obtained by the President's 1995 
     interagency task force on rural credit. The Managers also 
     expect the Secretary to complete this study and provide this 
     report by July 1996.


                     SUBTITLE E--GENERAL PROVISIONS

     (28) Conforming Amendments
       The Senate amendment contains conforming amendments of a 
     technical nature to the Con Act concerning USDA's farm loan 
     programs. (Section 651)
       The House bill has no comparable provisions.
       The Conference substitute adopts the Senate amendment 
     regarding the Con Act technical changes. (Section 661)
     (29) Electronic filing of financial statements and effective 
         dates
       The Senate amendment contains amendments to the Farm Credit 
     Act of 1971 regarding the Agricultural Mortgage Secondary 
     Market, commonly known as Farmer Mac, and the Farm Credit 
     System. (Sections 661 through 699A)
       The House bill has no comparable provisions.
       The Conference substitute adopts the House provision 
     deleting the Senate amendments regarding Farmer Mac and the 
     Farm Credit System. Public Law 104-105, which was signed by 
     the President on February 10, 1996, enacted the same Farmer 
     Mac and Farm Credit System provisions. The Conference 
     substitute also amends the Senate provision to allow the 
     electronic filing of financial statements without the 
     signature of the debtor providing State law authorizes such a 
     filing and to provide guidance on the effective dates for the 
     amendments made by this Title, including directing that 
     regulations issued in response to these amendments are to be 
     published as interim final rule. (Sections 662 and 663)
       The Managers expect USDA in promulgating the rules to carry 
     out the filing provisions for electronic financing statements 
     to address the concerns of those States that have central 
     filing, but have not yet implemented electronic filing, and 
     will continue to utilize paper transactions. Commercial 
     lenders have expressed a great deal of concern and confusion 
     due to the vagueness of the continuation provisions that are 
     related to the financing statements included in the Food 
     Security Act of 1985 and its inconsistency with Article IX of 
     the Uniform Commercial Code.

[[Page H2826]]

                      Title VII--Rural Development


Subtitle A--Amendments to the Food, Agriculture, Conservation and Trade 
                              Act of 1990

                     Chapter 1--General Provisions

     (1) Rural investment partnerships
       The Senate amendment extends the authorization for Rural 
     Investment Partnerships and provides an authorization for 
     appropriations of $4.7 million for each of fiscal years 1996-
     2002. (Section 701)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to repeal the authorization for Rural Investment 
     Partnerships. (Section 701)
     (2) Water and waste facility financing
       The Senate amendment strikes duplicate authority (section 
     2322 of the FACT Act) for water and waste facility financing 
     for Rural Utility Service borrowers that exists in Section 
     306(a) of the Con Act. (Section 702)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 702)
     (3) Rural Circuit Rider Wastewater Program
       The Senate amendment repeals authority for the Circuit 
     Rider Water and Waste Technical Assistance Program. The 
     authority is consolidated with all authorized rural water and 
     wastewater technical assistance and training programs in 
     Section 306(a)(16) of the Con Act. (Section 703)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 703)
     (4) Telemedicine and distance learning services in rural 
         areas
       The Senate amendment reauthorizes and streamlines the 
     Distance Learning and Telemedicine Program. A Treasury-rate 
     loan program is created to assist rural borrowers in making 
     telecommunications and data linkages available. The Senate 
     bill authorizes appropriations of $100,000,000 for each of 
     fiscal years 1996-2002. (Section 704)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment giving borrowers the right to appeal funding 
     decisions. If the Secretary rejects the application of a 
     borrower who applies for assistance, the borrower may appeal 
     the decision to the Secretary not more than 10 days after the 
     borrower is notified of the funding decision. (Section 704)
       The Managers are concerned that past application, 
     evaluation and approval procedures of the distance learning 
     and telemedicine program have resulted in questions about the 
     equity and validity of the application evaluation process. 
     The conference amendment to the loan program is intended to 
     provide a more rational and timely appeal procedure. Although 
     the Managers understand that the Rural Utilities Service 
     (RUS) provides information to applicants whose applications 
     have been disapproved, the Managers intend for RUS to provide 
     with each disapproval notice the raw scores for each proposal 
     and a list by rank of each application that was approved and 
     each that was disapproved.
       The Managers also are concerned that the application 
     appraisers may not have sufficient practical expertise in 
     rural areas, and indeed, may lack sufficient technical 
     understanding of some aspects of applications. The managers 
     would encourage RUS to make certain the reviewers have 
     technical and/or managerial expertise in the fields of 
     telecommunications, telemedicine, distance learning and 
     project management and are able to evaluate sufficiently each 
     application fully on its merits.
       To ensure that each applicant's submission is clearly 
     understood by the RUS staff, the Managers believe that a 
     formal presentation opportunity should be afforded each 
     applicant that requests one, arranged as part of the formal 
     application review process. The Managers recognize that while 
     not every applicant may desire to give such a staff 
     presentation, interested applicants need an opportunity to 
     appear briefly before the reviewing staff, to pose and answer 
     questions about their application. To the extent practicable, 
     this may be accomplished through meetings in the field so 
     that no applicant is unduly burdened financially.
       The Managers intend for this approach to assist both 
     applicants and RUS staff in finding and funding the best 
     applications, ensuring a fair and equitable procedure so that 
     questions are clarified. The Managers believe such a 
     procedure would minimize misinformation from entering the 
     application evaluation process.
       Finally, the Managers believe that applications must be 
     considered both on the part of reviewers and RUS staff 
     without regard to how the service is delivered. Technology 
     bias on the part of RUS staff has been a constant criticism 
     and should be avoided whenever possible. The Managers intend 
     that successful applications will be those considered 
     entirely on their merits, and that applications for start-up 
     programs should not receive greater weight than proven 
     programs needing upgrades, improvements or expansion.
     (5) Limitations on authorization of appropriations for Rural 
         Cooperative Development Grant Program
       The Senate amendment eliminates the authorization for 
     appropriations for the Rural Technology and Cooperative 
     Development Grant Program. The authorization for the program 
     is maintained in section 310B of the Con Act. (Section 705)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 705)
     (6) Monitoring the progress of rural America; demonstration 
         grants
       The Senate amendment repeals an obsolete provision for the 
     collection of statistics on the economic progress of rural 
     America in the 1992 Census. (Section 706)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to repeal authority which provides for rural 
     economic development competitive grants. (Sections 706 and 
     707)
     (7) Analysis by Office of Technology Assessment
        The Senate amendment repeals obsolete authority for the 
     Office of Technology Assessment to study the effects of 
     information technology on rural America. (Section 707)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 708)
     (8) Rural Health Infrastructure Improvement Program
       The Senate amendment repeals unfunded authority for a 
     demonstration project for rural health infrastructure 
     improvement. (Section 708)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 709)
     (9) Census of agriculture; study of transportation of 
         fertilizer
       The Senate amendment repeals an obsolete requirement for a 
     1992 Census question on agricultural accidents and farm 
     safety. (Section 709)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to repeal authority for a study of the 
     transportation of fertilizer and agricultural chemicals to 
     farmers. (Sections 710 and 711)

   Chapter 2--Alternative Agricultural Research and Commercialization

     (10) Alternative Agricultural Research and Commercialization 
         Corporation
       The Senate amendment contains definitions for ``Corporate 
     Board'' and ``Corporation.'' (Section 721)
       It converts the Alternative Agricultural Research and 
     Commercialization Center to the Alternative Agricultural 
     Research and Commercialization Corporation, a wholly-owned 
     government corporation within the Department of Agriculture. 
     The purpose of the Corporation is identical to the purpose 
     for the Center--to expedite the development and market 
     penetration of industrial (non-food, non-feed) products from 
     agricultural and forestry materials and to assist the private 
     sector in bridging the gap between research results and the 
     commercialization of that research. (Section 722)
       The general powers of the Corporate Board are expanded to 
     allow the Corporation to sell assets, loans, and equity 
     interests held by the Corporation. (Section 723)
       The membership of the Corporate Board is increased from 9 
     members under current law to 10 members: the Under Secretary 
     of Agriculture for Rural Economic and Community Development; 
     the Under Secretary of Agriculture for Research, Education 
     and Economics; four members appointed by the Secretary--one 
     scientist, one producer or processor of agricultural 
     commodities, one member engaged in the commercialization of 
     new non-food, non-feed products; two members appointed by the 
     Secretary who have expertise in applied research and who are 
     nominated by the National Science Foundation; and two members 
     who have experience in financial management and who are 
     nominated by the Secretary of Commerce. (Section 723)
       The Secretary is given authority to vacate and remand to 
     the Board for reconsideration any funding decision for cause. 
     The Secretary is required to inform the Board of the reasons 
     for any remand. Board members serving at the time the Center 
     is converted to the Corporation may be reappointed for the 
     remainder of their term by the Secretary. The Senate 
     amendment prohibits Board members from voting on applications 
     if they have a conflict of interest and the Board of 
     Directors is required to establish bylaws for the Corporation 
     and requires the Secretary to review and approve the bylaws 
     prior to adoption by the Board. The authority for the 
     Corporation to establish advisory councils is eliminated. 
     (Section 723)
       It makes conforming changes reflecting the Center's new 
     status as a Corporation. (Sections 724-727)
       Contents of the Alternative Agricultural Research and 
     Commercialization Revolving Fund may now include proceeds 
     from the sale of assets, loans, and equity interests made in 
     association with the goals of the Corporation. Funding 
     allocation restrictions are established: (1) limits 
     administrative expenses of the Corporation to the lesser of 
     $3 million or 15 percent of appropriated funds in each fiscal 
     year; (2) allows 1 percent of appropriated funds to be used 
     for studies and reviews of individual proposals for 
     assistance; (3) establishes that not less than 84 percent of 
     funds appropriated shall be set aside to fund individual 
     projects; and retains current law which provides that 
     uncommitted funds in each fiscal year are to be credited to 
     the Fund and authorizes the roll-over

[[Page H2827]]

     of funds for succeeding fiscal year funding of projects. The 
     Board is given discretion to establish in the bylaws of the 
     Board a policy for individual project monitoring and 
     evaluation--the cost of which is not to exceed 1 percent of 
     assistance per project award. (Section 728)
       The Senate amendment further provides for the transfer of 
     assets of the Revolving Fund to the Treasury upon expiration 
     of the Corporation's authority. It provides an authorization 
     for an appropriation of $75 million for each of fiscal year 
     1996-2002. (Section 728)
       An executive agency is given authority to give a price or 
     technical evaluation preference in procurement practices to 
     products successfully commercialized with assistance provided 
     by the Corporation. (Section 729)
       Lastly, the Senate amendment requires the Corporate Board 
     to develop a five-year business plan not later than 180 days 
     after the date of enactment and submit the plan to the 
     Secretary of Agriculture, the Committee on Agriculture of the 
     House of Representatives, and the Committee on Agriculture, 
     Nutrition and Forestry of the Senate. In addition, the 
     Secretary is required to conduct a study and prepare a report 
     by December 31, 2001 on the feasibility of privatizing the 
     Corporation and converting it to a government-sponsored 
     enterprise. (Section 730)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to give the Secretary authority to appoint an 
     additional Corporate Board member with financial management 
     expertise, resulting in an 11-member Corporate Board. 
     (Sections 721-730)
       The Managers note that the move to establish the 
     Alternative Agricultural Research and Commercialization 
     Center as an independent agency within USDA was the result of 
     concerns that the Center was being ``co-opted'' into the 
     programming of other USDA business-related agencies. Despite 
     departmental reorganization legislation (P.L. 103-354, 
     subtitle A--General Reorganization Authorities, section 
     211(m)) which specifically exempted the Center from the 
     reorganization and thus maintained the Center's independence, 
     USDA continued its efforts to turn the Center into an adjunct 
     program of the Rural Business-Cooperative Service. Measures 
     have been taken to ensure the Corporation's independence.
       As a new program, the Center has experienced ``growing 
     pains'' over the last 2 years. In March 1995, the 
     Department's Office of the Inspector General (OIG) reported 
     that the Board members had not adequately disclosed their 
     financial interests in projects; have operated under policies 
     and procedures contained only in a draft manual, not in 
     regulations; and have not required audited financial 
     statements from applicants before approving projects. In 
     addition, the Center exercised due diligence sporadically. 
     The Managers recognize that steps are now being taken to 
     approve management controls and oversight to remedy these 
     problems.
       In converting the Center to the Corporation, the Committee 
     is imposing a number of controls on the activities of the 
     Corporation and the Board. The Board is required to establish 
     bylaws, which have to be reviewed and approved by the 
     Secretary. As an agency of the Department of Agriculture, the 
     Corporation is subject to oversight by the Secretary and can 
     be audited and investigated by the OIG. In addition, the 
     Corporation will be subject to the auditing and budgeting 
     requirements of the Government Corporations Act. Strict 
     conflict-of-interest restrictions are imposed, and the 
     Secretary is given the authority to remand funding decisions 
     made by the Board if the restrictions are violated. The 
     Secretary is also directed to establish financial disclosure 
     requirements for the Board.
       In developing bylaws, the Managers expect the Board to 
     establish clear criteria to be used in evaluating 
     applications for commercialization projects. The criteria 
     should ensure that the entity receiving assistance is in 
     sound financial condition, has the financial, technical, and 
     managerial capability to undertake the project, and has a 
     reasonable expectation of success.
        The Board's decision of funding projects should be based 
     on the feasibility of the project, its marketability, the 
     ability of the applicant to be successful in commercializing 
     the product, and the ability of the applicant to repay the 
     financial assistance it receives or provide a return on the 
     Corporation's investment. Other considerations are the 
     availability of matching funds, private-sector participation, 
     potential market size, potential for jobs creation, state and 
     local government participation, likelihood of reducing 
     federal commodity support payments, likely impact on resource 
     conservation, and likely impact on the environment. The 
     Managers intend for the Corporation's continued independence 
     to prevent political pressure from influencing the funding 
     decisions of the Board of Directors.
        The Managers also recognize the need to improve 
     procurement procedures and regulations to allow the 
     Corporation to function efficiently. The Corporation is part 
     owner of many of the companies it supports. The Corporation 
     should divest itself of that ownership as soon as practicable 
     so that invested funds are returned to the revolving fund to 
     be reinvested.
        A new section is added to authorize an executive agency to 
     give a price or technical evaluation preference in 
     procurement practices to products successfully commercialized 
     with assistance provided by the Corporation. The Managers 
     believe that the Federal government should be allowed to 
     procure new-use products that meet the unique needs of 
     individual agencies. This change makes it easier for federal 
     managers to purchase Corporation-supported products for use 
     by the federal government. However, the Committee intends 
     that government procurement should not, under any 
     circumstance, establish the validity and sustain the 
     viability of any given Corporation project.
        Further, the Managers believe that with adequate funding 
     of the revolving fund, the Corporation should eventually 
     become self-sufficient. Authorized appropriations for the 
     Center from 1991 through 1995 were $185 million, while actual 
     appropriations were only $25.75 million, including a $1.5 
     million rescission.
        The Managers regret the lack of funding available to 
     establish regional centers. However, it is the Managers' view 
     that the establishment and utilization of these centers under 
     current budget restraints is not feasible.
        Finally, the Secretary is required to prepare and transmit 
     a report by December 31, 2001, to the Senate Committee on 
     Agriculture, Nutrition and Forestry and the House Committee 
     on Agriculture on the feasibility of privatizing the 
     Corporation or converting it to a government-sponsored 
     enterprise. The Managers agree that the Corporation should 
     investigate all means by which to increase its self-
     sufficiency through funding approaches that increase the 
     level of assets in the revolving fund.


 Subtitle B--Amendments to the Consolidated Farm and Rural Development 
                                  Act

                     Chapter 1--General Provisions

     (11) Water and waste facility loans and grants; rural 
         business opportunity grants; and Technical Assistance and 
         Training Program
        The Senate amendment reauthorizes and increases the 
     appropriation for water and waste treatment grants from 
     $500,000,000 to $590,000,000. It maintains the 10,000 
     population limitation for water and waste disposal grants and 
     direct and guaranteed loans only.
        The amendment requires that sewer, waste, and water 
     treatment projects funded under this section conform to State 
     standards established under the Safe Drinking Water Act and 
     the Clean Water Act.
        It authorizes grants not to exceed $1.5 million annually--
     to establish centers for training, technology, and trade that 
     provide assistance to rural businesses in the utilization of 
     interactive communications technologies used to develop 
     export markets. An appropriation of $7,500,000 for each of 
     fiscal years 1996-2002 is authorized for this purpose.
        The amendment eliminates unused authority for grants to 
     volunteer fire departments for training and fire fighting 
     equipment. It eliminates duplicate authority for loans for 
     construction, acquisition, and operation of electric 
     facilities receiving power from Power Marketing 
     Administrations.
        The amendment combines the authority for the wastewater 
     technical assistance and training programs contained in 
     section 2324 of the FACT Act with the rural water technical 
     assistance program in the Con Act, and increases the funding 
     level to account for consolidation of the two programs. 
     (Section 741)
        The House bill has no comparable provision.
        The Conference substitute adopts the Senate provision. 
     (Section 741)
        The Managers recognizes the strong performance and success 
     of the National Rural Water Association's water and 
     wastewater Circuit Rider technical assistance program and 
     encourages continued support for the program. With 
     diminishing levels of discretionary funding on the horizon, 
     the Managers believe it paramount to maintain the 
     Department's role in technical assistance to ensure that 
     economically distressed rural communities conform to 
     standards set forth in the Clean Water Act and the Safe 
     Drinking Water Act.
     (12) Emergency Community Water Assistance Grant Program for 
         small communities
        The Senate amendment combines the emergency assistance 
     program for communities of 15,000 or less with the program 
     for communities of 5,000 or less established by section 306B. 
     Not less than 50 percent of available funds is required to be 
     allocated to communities with populations of less than 3,000. 
     The reauthorization of appropriation of $35 million is 
     extended from 1996-2002. (Section 742)
        The House bill has no comparable provision.
        The Conference substitute adopts the Senate provision with 
     an amendment to cap the population eligibility criteria at no 
     more than 10,000 population. (Section 742)
     (13) Emergency Community Water Assistance Grant Program for 
         smallest communities
        The Senate amendment repeals authority for the program. 
     (Section 743)
        The House bill has no comparable provision.
        The Conference substitute adopts the Senate provision. 
     (Section 743)
     (14) Agricultural Credit Insurance Fund
        The Senate amendment eliminates obsolete authority in to 
     insure loans with funds

[[Page H2828]]

     made available through a revolving fund of the Agricultural 
     Credit Insurance Fund. (Section 744)
        The House bill has no comparable provision.
        The Conference substitute adopts the Senate provision. 
     (Section 744)
     (15) Rural Development Insurance Fund
        The Senate amendment eliminates obsolete authority to 
     insure loans with funds made available through the Rural 
     Development Insurance. (Section 745)
        The House bill has no comparable provision.
        The Conference substitute adopts the Senate provision. 
     (Section 745)
     (16) Insured watershed and resource conservation loans
       The Senate amendment eliminates obsolete authority for 
     insured watershed and resource conservation and development 
     loans. (Section 746)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 746)
     (17) Rural industrialization assistance programs
       The Senate amendment eliminates unused authority for 
     pollution abatement grants, eliminates unused authority for 
     insuring and guaranteeing loans for constructing or improving 
     subterminal facilities, eliminates authority for loans to 
     fund facilities for sharing telecommunications terminal 
     equipment, computers and software with approval of State 
     Rural Economic Development Review Panels, and makes 
     competitive the awarding of passenger transportation services 
     or facilities grants.
       The Senate amendment amends the Rural Cooperative and 
     Technology Development grant program by: 1) narrowing the 
     focus and renaming the program the ``Rural Cooperative 
     Development Grant program; 2) emphasizing job creation in 
     rural areas through the development of rural cooperatives, 
     value-added processing, and rural businesses; 3) refocusing 
     the efforts of the regional centers on technology research, 
     feasibility studies, training, technology transfer, and 
     technical assistance; 4) targeting the activities of the 
     rural technology centers to build the capacity of rural 
     industries, cooperatives, and agribusinesses; 5) establishing 
     criteria for preferences in the awarding of grants, including 
     a requirement to award grants on a competitive basis; 6) 
     allowing the Secretary to make grants to defray up to 75 
     percent of the costs incurred by organizations and public 
     bodies to carry out projects under this program; and 7) 
     authorizes an appropriation of $50,000,000 million for each 
     of fiscal years 1996-2002.
       The Senate amendment authorizes the Secretary to make loan 
     guarantees for the purchase of start up stock in a 
     cooperative. To qualify for participation, the farmer must 
     produce the agricultural commodity that will be processed by 
     the cooperative. (Section 747)
       The House bill has no comparable provisions.
       The Conference substitute adopts the Senate provision with 
     an amendment that extends eligibility for loans and grants 
     for rural industrialization to industries undergoing 
     adjustment from terminated Federal agricultural price and 
     income support programs or increased competition from foreign 
     trade. (Section 747)
       The Managers intend to target the limited funds available 
     for the Rural Cooperative Development Grant program on 
     cooperative development centers that operate on a regional or 
     statewide basis. By focusing this grant program on regional 
     centers rather than on small, local projects, the Committee 
     hopes to link cooperatives from different communities and 
     different sectors of the economy to strengthen the 
     cooperative movement as a whole. Recipients of the grants may 
     include a wide range of nonprofit organizations and 
     educational institutions.
       The Managers are aware of the pressing financing needs of 
     new cooperatives. The Managers are also aware of changes 
     being considered by the Rural Business-Cooperative 
     Development Service (RBCS) to the Business and Industry (B&I) 
     guaranteed program to address those needs. The Committee 
     encourages RBCS to consider proceeding with changes to the 
     B&I guaranteed loan program regulations to provide for more 
     flexibility in equity requirements while maintaining due 
     diligence requirements for overall credit quality analysis.
       The Managers are also aware of interest in changing the 
     current regulations of the Business and Industry guaranteed 
     program. The regulations effectively preclude construction 
     and start-up costs from inclusion under the guarantee. The 
     Managers encourage RBCS to consider amending the B&I 
     guaranteed loan regulations, as necessary, to provide for 
     guarantees that are effective during the construction and 
     start-up phase of projects. Changes to the regulations could 
     include providing an alternative procedure without the 
     current requirement that property acquisition and 
     construction must be completed before the guarantee is 
     effective, with guidelines for when the alternative procedure 
     will be used.
       The Managers strongly urge the Department to use the 
     Business and Industry loan guarantee program in the 
     development of value-added agricultural processing 
     cooperatives and other value-added small businesses. These 
     new businesses have the potential for raising farm income for 
     producers, creating new wealth, and revitalizing local 
     communities. Furthermore, the Managers believe that the B&I 
     program can be effectively targeted to producers without the 
     liquid assets to readily invest, to guarantee up to 30 
     percent of an individual's purchase stock in value-added 
     agriculture processing businesses, including cooperatives, up 
     to a maximum of $10,000 per eligible investor, and still 
     protect the integrity of the loan guarantee. No more than 30 
     percent of a project's equity investment shall be guaranteed 
     in this manner, assuming a satisfactory business plan. The 
     Department which is permitted under current law to use the 
     B&I loan guarantee in this manner, should take the necessary 
     steps to implement this recommendation within 90 days of 
     enactment of this bill.
     (18) Administration-Debt reduction by secretary
       The Senate amendment gives the Secretary authority to 
     reduce debt for loan programs administered by the Rural 
     Utilities Service, the Rural Housing Service, and the Rural 
     Business-Cooperative Service. The Attorney General must be 
     notified of the Secretary's intent to exercise any debt 
     reductions. (Section 748)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 748)
     (19) Authorization for appropriation
       The Senate amendment eliminates obsolete direct loan 
     authority. (Section 749)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 749)
     (20) Testimony before congressional committees
       The Senate amendment eliminates the requirement for the 
     Secretary to testify before both House and Senate Agriculture 
     Committees by February 15th of each year. (Section 750)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 750)
     (21) Prohibition on use of loans for certain purposes
       The Senate amendment gives the Secretary the authority to 
     approve loans for utilities that cross wetlands. (Section 
     751)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 751
     (22) Rural Development Certified Lenders Program
       The Senate amendment creates a certified lenders program 
     for the Business and Industry guaranteed loan program and 
     other rural development loan programs under title III of the 
     Con Act. (Section 752)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 752)
     (23) System for delivery of certain rural development 
         programs
       The Senate amendment repeals the system of State Rural 
     Economic Review Panels for rural development program 
     delivery. (Section 753)
       The House bill has no comparable provision
       The Conference substitute adopts the Senate provision. 
     (Section 753)
     (24) State Rural Economic Development Review Panel
       The Senate amendment repeals the duties and structure of 
     State Rural Economic Review Panels. (Section 754)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 754)
     (25) Limited transfer authority of loan amounts
       The Senate amendment repeals the transfer of appropriated 
     funds for water and waste facility direct loan programs to 
     loan programs administered by the State Rural Economic Review 
     Panels. (Section 755)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 755)
     (26) Allocation and transfer of loan guarantee authority
       The Senate amendment repeals State Rural Economic Review 
     Panels authority to administer water and waste facility 
     guaranteed loan programs. (Section 756)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 756)
     (27) Water systems for rural and native villages in Alaska; 
         water and waste disposal application requirements
       The Senate amendment provides the Secretary with the 
     authority to make grants to the State of Alaska for the 
     benefit of rural and Native villages to develop and construct 
     water and wastewater systems to improve sanitation 
     conditions. To be eligible to receive a grant, the State of 
     Alaska will provide equal matching funds from non-Federal 
     sources. There are authorized to be appropriated $15 million 
     for each of fiscal years 1996 through 2002. (Section 552)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to require that not later than 60 days before a 
     preliminary loan is filed for a loan or grant for

[[Page H2829]]

     water and waste disposal assistance, a notice of the intent 
     of the applicant to apply for the loan shall be published in 
     a general circulation newspaper. In addition, the selection 
     of engineers for a project shall be done by a request for 
     proposals by the applicant. (Sections 757 and 758)
       The Managers encourage the Secretary to consider cost-
     effectiveness and viability of other drinking water delivery 
     options prior to making decisions regarding the funding of 
     new or expanded community water facilities which should 
     include, but not limited to, community water systems, cluster 
     well systems and individual privately-owned wells.
     (28) National Sheep Industry Improvement Center
       The Senate amendment establishes the National Sheep 
     Industry Improvement Center. The purposes of the Center shall 
     be to: (1) promote strategic development activities and 
     collaborative efforts by private and State entities to 
     maximize the impact of Federal assistance to strengthen and 
     enhance the production and marketing of lamb and wool 
     products in the United States; (2) optimize the use of 
     available human capital and resources within the lamb 
     industry; (3) provide assistance to meet the needs of the 
     sheep or goat industry for infrastructure development, 
     business development, resource development and market and 
     environmental research; (4) build the capacity of the U.S. 
     sheep industry to design responses to the special needs of 
     the lamb and wool industries on both a regional and national 
     basis; and (5) adopt flexible and innovative approaches to 
     solving the long-term needs of the U.S. sheep industry.
       Funding for the Center's activities shall derive from the 
     establishment of a revolving fund. This fund shall be capped 
     at $50 million--$20 million of the fund shall be mandatory 
     monies deposited by the Treasury into the fund from any other 
     moneys in the Treasury not otherwise appropriated. In 
     addition, authorization is provided for $30 million. After 10 
     years or upon receipt of $50 million to the revolving fund, 
     the Center and its activities shall be privatized and no 
     additional federal funds shall be used to carry out the 
     activities of the Center.
       The Center shall be managed by a nine member, non-
     compensated seven voting members and two non-voting members. 
     The seven voting members shall be chosen in an election of 
     the members of a national organization selected by the 
     Secretary of Agriculture that is comprised of primarily U.S. 
     sheep producers. The Board of Directors may use the monies in 
     the fund to make grants and loans to eligible entities in 
     accordance with a required annual strategic plan submitted to 
     the Secretary of Agriculture. An eligible entity under the 
     section is an entity that promotes the betterment of the U.S. 
     sheep industry that is a public, private or cooperative 
     organization. In addition, federally recognized Indian 
     tribes, non-profit organizations, and public or quasi-public 
     agencies are also eligible for assistance from the Center. 
     (Section 757)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to include the goat and goat product industry. 
     (Section 759)
       The Managers intend the National Sheep Industry Improvement 
     Center and revolving fund to assist and strengthen the U.S. 
     sheep and goat industries which have experienced dramatic 
     losses of infrastructure since 1993. The Center's activities 
     should focus on the production and marketing of meat, fiber 
     and hair. The Managers are concerned that over 16,000 of the 
     nation's sheep producers have left the business in the last 
     three years and the U.S. breeding herd has dropped 21 
     percent. Likewise, over 30 percent of the goat producers left 
     the goat industry during that same time period. The Managers 
     are also concerned with the severe loss of the industry's 
     infrastructure--one-third of the major lamb packing plants in 
     the United States have closed down operations.
       It is the intent of the Managers that prior to submitting 
     the list of nominations of the voting members for the Board 
     of Directors to the Secretary, the national organizations 
     shall consult with state associations that represent 
     producers of sheep or goats. It is also the Managers position 
     that the final composition of the Board reflect the 
     comparative production of the industries.
       The Managers expect that the Secretary will balance the 
     equities between all segments of the sheep and goat 
     industries in order to ensure participation by all facets of 
     the industries in appointing members to the Board.
     (29) Cooperative agreements
       The Senate amendment gives the Secretary the authority to 
     enter into cooperative agreements with other Federal agencies 
     and State and local governments without being subject to the 
     funding limitations imposed by the Federal Grant and 
     Cooperative Agreement Act of 1977. (Section 793)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 759A)
     (30) Eligibility for grants for broadcasting systems
       The Senate amendment provides a definition for 
     ``statewide'' coverage for the Television Demonstration Grant 
     program. The term ``statewide'' means having a coverage area 
     of not less than 90 percent of the population of a State and 
     not less than 80 percent of the rural land area of the State. 
     (Section 553)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 759B)

             Chapter 2--Rural Community Advancement Program

     (31) Rural Community Advancement Program
       The Senate amendment establishes the Rural Community 
     Advancement Program (RCAP), a new rural development program 
     delivery mechanism.
       The Senate amendment in Section 381A establishes that the 
     terms ``rural,'' ``rural area,'' and ``State'' under the RCAP 
     are subject to section 306(a)(7) of the Con Act which 
     restricts water and wastewater program participation to towns 
     with population of no more than 10,000 inhabitants. 
     Eligibility for numerous programs are consolidated into one 
     definition: a city, town, or unincorporated area that has a 
     population of 50,000 inhabitants or less, other than an 
     urbanized area immediately adjacent to a city, town, or 
     unincorporated area that has a population in excess of 50,000 
     inhabitants. In section 381B, The RCAP is established to 
     provide grants, direct and guaranteed loans and other 
     assistance to meet the unique rural development needs of 
     local communities and federally recognized Indian tribes.
       National objectives are established in section 381C of the 
     Senate amendment to promote strategic development and 
     collaborative efforts by the State and local communities to 
     maximize the impact of Federal assistance; to optimize the 
     use of local and State resources; and when providing 
     assistance, to consider the complexity of rural needs for 
     business development, health care, education, infrastructure, 
     the environment, housing, and cultural resources.
       The Senate amendment in section 381D requires the Secretary 
     to direct each of the Directors of Rural Economic and 
     Community Development State Offices to prepare a strategic 
     plan for each state. Financial assistance for rural 
     development projects within each State under RCAP must be 
     consistent with the plan.
       Further, assistance under the RCAP may only be provided to 
     an entity that is located in a rural area as defined under 
     the RCAP. The Secretary is required to give priority to 
     communities with the smallest populations and lowest per 
     capita income.
       The Senate amendment requires the Secretary to review the 
     plan every 5 years. A strategic plan must: (1) coordinate 
     plans and activities proposed for the area; (2) require the 
     State and local communities to act as full partners in the 
     process of developing and implementing the plan; (3) identify 
     goals, methods, and benchmarks for measuring the success of 
     the strategic plan; (4) be prepared in consultation with 
     State, local, public and private entities, State rural 
     development councils, federally-recognized Indian tribes, and 
     community-based organizations; (5) identify federal and non-
     Federal resources available for implementation of the plan; 
     and (6) include any other information required by the 
     Secretary.
       In section 381E, the Senate amendment consolidates over a 
     dozen programs included in the RCAP into three function 
     category accounts: (1) Rural Housing and Community 
     Development includes direct loans, loan guarantees and grants 
     for community facilities, and new construction funds for 
     rural rental housing grants; (2) Rural Utilities includes 
     grants, direct and guaranteed loans for rural water and 
     wastewater disposal; grants for solid waste management; rural 
     water and wastewater technical assistance and training 
     grants; and emergency community water assistance; (3) Rural 
     Business and Cooperative Development includes local technical 
     assistance grants; rural business opportunity grants; 
     guaranteed business and industry assistance loans; and grants 
     for rural business enterprises. The Secretary will allocate 
     the amounts in the three accounts among the States. The 
     Secretary is given the authority to determine the allocation 
     taking into consideration rural population, levels of income, 
     unemployment, and other relevant factors, as determined by 
     the Secretary.
       The Secretary is also given authority in section 381E of 
     the Senate amendment to transfer amounts allocated to the 
     States for any of the three function categories for a fiscal 
     year to a fourth function category: 1) mutual and self-help 
     housing grants pursuant to section 523 of the Housing Act of 
     1949; 2) rural rental housing loans for existing housing 
     pursuant to section 515 of the Housing Act of 1949; 3) rural 
     cooperative development grants provided under section 
     310B(E); and 4) grants to broadcasting systems provided under 
     section 310B(f). The funding for programs in the fourth 
     function category may not be transferred out of these program 
     accounts for funding other programs. Funds can only flow into 
     these program accounts.
       The Senate amendment permits the Secretary to transfer up 
     to 25 percent from the amount allocated for a State under 
     each function category in each fiscal year to any other 
     function category within that State. However, not more than 
     10 percent of the total appropriations to the RCAP at the 
     national level may be transferred among the three function 
     categories.
       The Senate amendment provides that the Secretary shall make 
     available not more than 5 percent of appropriated funds for 
     the RCAP to defray the cost of any subsidy associated with 
     the state loan guarantee program provided for under the RCAP.

[[Page H2830]]

       In section 381F, the Secretary shall reserve not more than 
     10 percent of the total funds appropriated for the RCAP to 
     establish a national office reserve for rural development 
     purposes. The national reserve may be used for emergencies, 
     for incentive awards, or for performance-oriented 
     demonstration projects. A three percent reserve shall be 
     established for Federally-recognized Indian tribes to carry 
     out rural development programs included in the RCAP. The 
     reserve is to be administered through the appropriate Rural 
     Economic and Community Development State Office Director.
       The Senate amendment establishes the criteria for making 
     allocations for the States. In making allocations for fiscal 
     years 1997-2002, the Secretary shall ensure that the 
     percentage allocation for each State is no less than the 
     percentage of the average of the total funds obligated for 
     the programs in each State in fiscal years 1993 and 1994. The 
     minimum allocation constitutes a ``hold harmless'' provision. 
     Funds allocated under this section are for Federal rural 
     development programs within a State, and are not granted 
     directly to the State.
       The Senate amendment establishes a State RCAP grant in 
     section 381G. It allows a State to request a grant of not 
     more than 5 percent of the sums allocated for the State in 
     any fiscal year. A state may request an additional 5 percent 
     from the State allocation if the State provides non-Federal 
     matching funds equal to 200 percent of the grant amount. The 
     state is required to maintain the grant funds and any non-
     Federal matching funds in a separate account. State RCAP 
     grant funds shall be used in rural areas for the same 
     purposes as the funds appropriated for the programs included 
     in the three function categories. The grant funds also must 
     be used in accordance with the strategic plan for the State.
       The Senate amendment requires participating states to 
     provide assurances that the grant funds will be used to 
     supplement, not supplant, the amount of Federal, State, and 
     local funds committed to rural development. States are 
     prohibited from using grant funds for administrative 
     purposes.
       The Senate amendment establishes a guaranteed loan program 
     in section 381H to give States the ability to leverage RCAP 
     State grant funds with loan guarantees. The Secretary is 
     authorized to guarantee loans made by States or other 
     eligible public entities for financing rural development 
     projects with the RCAP State grant funds. The amount of the 
     loan guarantee is limited to 5 times the amount of the RCAP 
     State grant. The cumulative total of outstanding obligations 
     guaranteed by the Secretary cannot at any time exceed amounts 
     authorized to be appropriated in any fiscal year for all RCAP 
     rural development programs.
       In section 381I, the Senate amendment requires that 
     applications for assistance demonstrate evidence of 
     significant community support.
       The Senate amendment in section 381J permits the 
     establishment of voluntary pooling arrangements among States, 
     and regional fund-sharing.
       The Senate amendment directs the Secretary in section 381M 
     to assume responsibility for establishing an interagency 
     working group chaired by the Secretary. The working group 
     shall establish policy, provide coordination, make 
     recommendations, and evaluate the performance of all Federal 
     rural development efforts.
       In section 381N, the Senate amendment requires Rural 
     Development State Directors to: ensure that the State 
     strategic plan is implemented; coordinate community 
     development objectives; establish links between State, local, 
     and USDA field office program administrators; ensure 
     recipient communities comply with applicable State and 
     Federal laws and requirements; and integrate state 
     development programs with assistance under the RCAP.
       The Senate amendment requires the Secretary to use 
     electronic transfer in section 381O for RCAP funds as soon as 
     practicable. (Section 761)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to require the Secretary to review the strategic 
     plan within 60 days of submission in section 381D and 
     maintain the present formula allocation established in 
     regulation for rural development programs in section 381E.
       Further, the House amendment in section 381E prohibits the 
     transfer of funds from Rural Community Advancement Program 
     activities into any housing programs, the rural cooperative 
     development grants program, or the grants to broadcasting 
     systems program. With the elimination of the fourth function 
     category and housing programs, three function categories for 
     rural development programs are established in the Rural 
     Development Trust Fund : Rural Community Facilities, Rural 
     Utilities, and Rural Business and Cooperative Development.
       The House amendment in section 381E requires the Secretary 
     to maintain a national reserve account. The reserve account 
     may not exceed 15 percent of rural development funds 
     available for fiscal year 1997, 12.5 percent in fiscal year 
     1998, 10 percent in fiscal year 1999, 7.5 percent in fiscal 
     year 2000, 5 percent in fiscal year 2001, and 5 percent in 
     fiscal year 2002. In fiscal years 1997 through 2000, reserve 
     account funds may be used to meet situations of exceptional 
     need, emergency situations, and to provide funds to entities 
     whose applications have been approved and who have not 
     received funds sufficient to meet the needs of projects 
     described in the applications. In fiscal years 2001 and 2002, 
     reserve account funds may be used only for situations of 
     exceptional need or emergency situations.
       The House amendment requires that not before July 15 of any 
     fiscal year, the Secretary transfer to the national reserve 
     account any amounts allocated to a State which have not been 
     obligated by the State Director to fund specific approved 
     projects within the State in section 381E.
       In section 381F, the House amendment authorizes an 
     automatic waiver of the national or state caps on the 
     transfer of funds from one function category to another. 
     Specifically, if there is an approved application for a 
     project in a function category, but there are no funds 
     available for projects in that function category, there is an 
     automatic waiver excusing the Rural Economic and Community 
     Development Director from compliance with the national or 
     state caps if there is no approved application in the 
     function category from which the funds are to be transferred, 
     or the community that would benefit from the transfer has a 
     smaller population and a lesser per capita income than any 
     community that would benefit from a project in the function 
     category from which the funds are to be transferred.
       The House amendment in section 381I further requires that 
     any community facilities or infrastructure project receive a 
     certification of support from each affected general purpose 
     local government.
       In adopting the Rural Community Advancement Program (RCAP), 
     the Managers agree that federal rural development programs 
     are uncoordinated and require a greater degree of integration 
     and local involvement. As a result, the U.S. Department of 
     Agriculture's rural development programs have had a limited 
     impact on stemming small rural communities' declining 
     economic prosperity and social well-being. Coordinating 
     goals, objectives and funding from federal programs, combined 
     with empowering state and local leaders through direct 
     involvement in providing federal assistance is key to any 
     successful rural community initiative. In order to improve 
     the effectiveness of federal rural development programs, an 
     innovative state--and local community-oriented delivery 
     system is necessary. The RCAP is based on three fundamental 
     concepts: (A) People at the state and local level are in the 
     best position to know and to respond to the needs of local 
     communities and governments. Constructive solutions are 
     generated by local leaders who are most informed about 
     problems and can appropriately tailor problem-solving 
     initiatives. More focus must be placed on the effectiveness 
     of program funding rather than on the process of obtaining 
     federal assistance; (B) ``one size fits all'' rural 
     development programs are not likely to be effective because 
     different areas need different solutions to their problems; 
     and (C) the top-down federal-to-local approach to rural 
     development erodes local incentives for leadership-building 
     and community cohesion. Local communities must play a leading 
     role in identifying local needs. Likewise, states are often 
     bypassed, or only peripherally involved in federal programs, 
     and they, too, need to be involved. States should coordinate 
     and combine federal initiatives with their own rural 
     development programs.
       With respect to a State's strategic plan, the Managers 
     specifically intend that State and local government officials 
     act as full partners in creating a plan for the delivery of 
     rural development assistance. The Managers are concerned that 
     the role of these State and local government officials does 
     not become merely procedural or consultative in nature. 
     Rather, the Managers intend that State and local government 
     officials play an integral and necessary role in the creation 
     of each State's strategic plan to, among other things, 
     identify the goals, priorities, and methods for the delivery 
     of rural development assistance. In sum, the Managers intend 
     the strategic plan to meaningfully reflect the input of State 
     and local government. Strategic plans which are prepared 
     consistent with the input of State and local governments as 
     contained in official hearing records may provide evidence to 
     satisfy the Managers' intent.
       The Managers intend that the national reserve account funds 
     be limited only by the priorities or preferences explicitly 
     contained in Title VII of the Act and that no further 
     priorities or preferences be established or otherwise adhered 
     to. Specifically, the national reserve account is expected to 
     be used for fiscal years 1997 through 2000 to meet situations 
     of exceptional need, emergency situations, and to provide 
     funds to entities whose applications for funds have been 
     approved and who have not received funds to satisfy project 
     needs described in the applications. In fiscal years 2001 and 
     2002, the purposes are limited to meet situations of 
     exceptional need and emergencies. In section 381F, the 
     Managers intend that there be an automatic waiver excusing 
     State Rural Economic and Community Development Directors from 
     compliance with limitations described in Subsections (a) and 
     (b). If the conditions under Subsection (c) are certified by 
     the State Rural Economic and Community Development Director 
     as being met, the waiver is expected to be granted. The 
     Managers intend that State Rural Economic and Community 
     Development Directors have maximum flexibility in meeting the 
     rural development needs of States. Further, the

[[Page H2831]]

     Managers intend that a State Rural Economic and Community 
     Development Director exercise the flexibility granted under 
     this Subsection in a manner that amounts allocated are 
     effectively used to address the State's rural development 
     needs.
       The Managers intend that any application for funds under 
     this title include documented evidence of significant 
     community support. To accomplish this end, the Managers 
     intend for the State Rural Economic and Community Development 
     Director to consider evidence of significant community 
     support contained in the application and any extraneous 
     evidence confirming or denying such support to ensure that 
     scarce Federal dollars finance only recognized rural 
     development needs.
       The Managers further intend that any application for funds 
     under this title for community facilities or infrastructure 
     projects must be certified by the affected general purpose 
     local government or governments. The Managers intend that the 
     applications subject to this requirement include, but are not 
     limited to, those made under the water and waste disposal 
     loan and grants programs, the community facilities loan and 
     grant programs, the solid waste management grant program, the 
     water and waste technical assistance and training program, 
     and the emergency community water assistance program.
       The Managers intend for the funding for federally 
     recognized Indian tribes to be targeted to communities or 
     reservations in Indian country in economic distress or with 
     significant percentages of residents living in poverty. 
     Indian tribes are expected to comply with the requirement of 
     preparing a strategic plan.
       The Managers agree that a wide range of factors should be 
     considered in setting allocations to reflect the diverse 
     needs of rural America. The Managers suggest that the 
     Department consider outmigration, cost of living, housing 
     affordability, and financial need in developing the funding 
     formula for allocation to the states under the RCAP.
       The Managers encourage the States to use their state grant 
     funds to accomplish state and local rural development 
     objectives. Suggested uses for grant funds include, but are 
     not limited to, revolving loan funds, matching grants, and 
     guaranteed loans. The Managers believe the State RCAP 
     guaranteed loan program will enable local governments 
     receiving RCAP state grant funds to obtain loan guarantees by 
     pledging current and future RCAP funds as security for the 
     loan. In order to obtain the guarantee, borrowers will be 
     required to provide additional security, such as pledges of 
     existing grant balances and program income, liens on assets 
     financed with the guaranteed loan funds, or the establishment 
     of loan reserves. In all cases, USDA will structure 
     additional security requirements to ensure that each 
     guaranteed loan is adequately collateralized with existing 
     assets and credit enhancements.
       The Managers expect the National Rural Development 
     Partnership to be the foundation upon which the Interagency 
     Working Group is established. In 1990, the National Rural 
     Development Partnership (the Partnership), a nonpartisan 
     interagency working group whose mission is to ``contribute to 
     the vitality of the Nation by strengthening the ability of 
     all rural Americans to participate in determining their 
     futures,'' was launched by Executive order. The Partnership 
     consists of senior program managers representing over 40 
     federal agencies, as well as national representatives of 
     public interest, community-based, and private-sector 
     organizations.
       The Managers expect the Interagency Working Group, like the 
     Partnership, to act as an information resource and 
     facilitator of effective rural development initiatives. It 
     will serve as the bellwether of rural development activities 
     in the United States, monitoring activities and initiatives 
     and reporting to Congress on what advances and what fails to 
     advance local improvements. In this regard, the Managers 
     believe that the Partnership should continue its role in 
     monitoring and reporting on policies and programs that work, 
     as well those that fail, to address the needs of rural 
     America.
       In addition, State Rural Development Councils (RDC) should 
     continue to act as the conduit to the Partnership. RDC 
     participation is driven not by access to new program dollars 
     but by a goal to increase the effective use of existing rural 
     development assistance.
       The State Councils are expected to play a role in the 
     formulation of local needs assessments and in the development 
     of state criteria for the distribution of RCAP funds. RDCs 
     will continue to play the role of monitor and trouble-shooter 
     for each state and work with the Partnership and Interagency 
     Working Group to advance the goals of RCAP.
       The Managers expect the Department, in implementing its 
     rural development activities, to give priority to those areas 
     at greatest risk because of health concerns. Areas such as 
     the ``Colonias'' lack not only the basic necessities of water 
     and waste facilities, but also all other basic infrastructure 
     development. The Department, through its various rural 
     development programs, should look at the ``totality of 
     circumstances'' in such areas and develop strategies that 
     will address all the needs in order to ensure total 
     development of these areas.
     Rural Venture Capital Demonstration Program
       The Senate amendment establishes in section 381K a Rural 
     Venture Capital Demonstration Program to demonstrate the 
     utility of guarantees to attract increased private investment 
     in rural business enterprises. The Secretary may in each 
     fiscal year designate up to 10 community development venture 
     capital organizations to participate. Each organization will 
     establish an investment pool for the purpose of making equity 
     investments in rural businesses. The Secretary is required to 
     guarantee not more than 30 percent of the total funds in a 
     pool against loss. The Secretary is authorized to issue 
     guarantees covering not more than $15 million for any fiscal 
     year. The term of a guarantee may not exceed 10 years.
       The Managers intend that the demonstration project be 
     implemented in a manner which ensures geographic diversity. 
     The Managers are concerned that the program's merit cannot be 
     accurately tested if the only participating organizations are 
     concentrated in a single State, region, or area. The Managers 
     believe that the demonstration project must be implemented in 
     various States, regions, and areas in order to demonstrate 
     viability in a diverse national economy.
       The Managers agree that the availability of loan programs 
     alone do not meet all the needs of rural areas for financing. 
     In order to develop the diverse economic base crucial for 
     survival in the modern economy, rural communities need access 
     to equity capital to finance business start-up and expansion. 
     The private-sector venture capital markets that fuel economic 
     growth often do not reach into small communities. The intent 
     of this demonstration program is to channel venture capital 
     to business ventures that would not otherwise be targeted by 
     traditional venture capital firms.
       The Managers intend this program to demonstrate the utility 
     of using a limited investment guarantee to draw private 
     investment capital to distressed rural communities. The 
     organizations selected to participate in the demonstration 
     will use the guarantee as a tool to attract investments from 
     philanthropic organizations, individual and corporate 
     investors, and other sources of private sector capital to 
     finance business development activities. Investments from 
     private investors will be pooled by the participating 
     organization into a Rural Business Investment Pool, and USDA 
     will guarantee up to 30 percent of the pool's value against 
     loss. The Committee expects that most if not all of the pools 
     will earn money over the term of the investments. Any pool 
     losses on the guarantee shall be paid out of the national 
     office reserve fund.
       An organization wishing to participate in this program must 
     submit a plan that describes how the funds will be raised and 
     merged in the pool and how the guarantee will help it raise 
     money. Each applicant will be asked to describe the need for 
     venture capital in its area, the types of business ventures 
     that will be targeted for investments, the process by which 
     investments will be chosen, and the likely forms of 
     investment. The Secretary is also expected to ensure that 
     organizations have procedures in place to avoid conflicts of 
     interest, mismanagement, and fraud.
       The Secretary will choose the organizations on the basis of 
     a competition, in which priority will go to organizations 
     that can demonstrate their experience--or the experience of 
     their top officials--in venture capital and small business 
     equity investments or in community development finance. 
     Priority will also be based on an organization's ability to 
     serve low-income communities, generate local wealth, and 
     target jobs to low-income individuals.
       Applicant organizations should demonstrate strong business 
     relationships with established banks and other financial 
     institutions or with community-based organizations. Since 
     diversification of risk will help reduce the likelihood that 
     the pool loses money, and thus will reduce the cost to the 
     government, the Secretary shall also give priority to 
     organizations that propose to maintain an investment 
     portfolio averaging $500,000 or less per business.
     (32) Community Facilities Grant Program; simplified 
         applications
       The Senate amendment authorizes grants under the Community 
     Facilities program. Grants can not exceed $10 million in any 
     fiscal year to any entity. A grant may not exceed 75 percent 
     of the development cost of the facility. The Secretary is 
     directed to provide a graduated scale for the amount of the 
     Federal share of the grant, establishing greater levels of 
     grant funding for facilities in communities that have lower 
     population and income levels. (Section 762)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that requires the Secretary to develop a 
     streamlined, simplified, and uniform application for 
     specified rural development programs within one year of 
     enactment. (Section 762 and 763)
       The Managers are concerned about the costly, complex, and 
     onerous paperwork involved in making an application for 
     assistance under Federal rural development programs. Managers 
     intend for the Secretary of Agriculture to create within one 
     year of the date of enactment one streamlined, simplified, 
     and uniform application for all rural development programs 
     eligible for funding under this title


    Subtitle C--Amendments to the Rural Electrification Act of 1936

     (33) Purposes investigations and reports
       The Senate amendment authorizes the Secretary to make or 
     commission studies, investigations, and reports regarding 
     financial,

[[Page H2832]]

      technological, and regulatory matters affecting the 
     condition and progress of electric and telecommunications 
     service and economic development in rural areas. An obsolete 
     provision requiring the issuance of regulations is deleted. 
     (Section 771)
       The House bill no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 771)
     (34) Authorization of appropriation; Reconstruction Finance 
         Corporation
       The Senate amendment eliminates references to the 
     Reconstruction Finance Corporation, an obsolete funding 
     mechanism for RE Act programs, and annual state allotments of 
     funds based on farms not receiving central station electric 
     service. The authorization of appropriations is retained. 
     (Section 772)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 772)
     (35) Loans for electrical plants and transmission lines
       The Senate amendment eliminates authority for 2 percent 
     loans for electrical plants and transmission lines. (Section 
     773)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 773)
     (36) Loans for electrical and plumbing equipment
       The Senate amendment repeals authority for loans for wiring 
     and plumbing which has not been funded since 1969. (Section 
     774)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 774)
     (37) Testimony on budget requests
       The Senate amendment eliminates a requirement that the 
     Secretary testify before the House and Senate Agriculture 
     Committees to justify the budget request. (Section 775)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 775)
     (38) Transfer of functions of administration
       The Senate amendment repeals an obsolete provision that 
     allowed the President to transfer the responsibilities of the 
     ERA to the Secretary in 1935. (Section 776)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 776)
     (39) Annual report
       The Senate amendment repeals the requirement for the 
     Secretary to submit an annual report to Congress summarizing 
     RUS activities. (Section 777)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 777)
     (40) Prohibition on restricting water and waste facility 
         services to electric customers
       The Senate amendment prohibits the ``tying'' of water and 
     waster facility financing to the purchase of electric service 
     from RUS borrowers, duplicating a provision that governs 
     water and waste programs under the Consolidated Farm and 
     Rural Development Act. (Section 778)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendment maintaining the provisions of the Consolidated Farm 
     and Rural Development Act and requiring the Secretary to 
     publish implementing regulations within 60 days of enactment. 
     (Section 778)
     (41) Telephone loans terms and conditions
       The Senate amendment eliminates a provision that allows 
     telephone borrowers to determine the term of a telephone 
     loan. (Section 779)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 779)
     (42) Privatization program
       The Senate amendment repeals an obsolete provision for an 
     electric loan prepayment plan for an Alaskan electric 
     cooperative. (Section 780)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 780)
     (43) Rural business incubator fund
       The Senate amendment repeals authority for the Rural 
     Business Incubator Fund. (Section 781)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 781)


         Subtitle D--Miscellaneous Rural Development Provisions

     (44) Interest rate formula
       The Senate amendment authorizes the Secretary to 
     reestablish the interest rate for the Resource Conservation 
     and Development loan program and the Watershed loan program. 
     (Section 791)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 791)
     (45) Grants for financially stressed farmers, dislocated 
         farmers, and rural families
       The Senate amendment eliminates unfunded authority for a 
     grant program that targets financially stressed farmers, 
     dislocated farmers and rural families. (Section 792)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 792)
     (46) Fund for rural america
       The Senate amendment creates an account called the Fund for 
     Rural America. The Secretary is given authority to transfer 
     from the Commodity Credit Corporation into the account $50 
     million in fiscal year 1996, $100 million in fiscal year 
     1997, and $150 million in fiscal year 1998.
       The Secretary may use funds for the following rural 
     development program activities authorized in:
       The Housing Act of 1949: direct loans to low-income 
     borrowers pursuant to section 502; loans for financial 
     assistance for housing for domestic farm laborers pursuant to 
     section 514; financial assistance for housing domestic farm 
     labor pursuant to section 516; grants and contracts for 
     mutual self-help housing pursuant to section 523(b)(1)(A); 
     grant for Rural Housing Preservation pursuant to section 533.
       Funds may also be used for Intermediary Relending Program 
     loans, Consolidated Farm and Rural Development Act section 
     310B Rural Business Enterprises grants, grants, direct and 
     guaranteed loans for water and wastewater projects pursuant 
     to section 306 of the Consolidated Farm and Rural Development 
     Act, Consolidated Farm and Rural Development Act section 310E 
     downpayment program assistance for beginning farmers, grants 
     for outreach to socially disadvantaged farmers and ranchers 
     pursuant to section 2501 of the Food, Agriculture, 
     Conservation, and Trade Act of 1990, and grants pursuant to 
     section 204(6) of the Agricultural Marketing Act of 1946.
       Up to one-third of the funds from the account may be used 
     to fund competitive research grants. Grants may be used for 
     research, extension, and education. Grants shall not be made 
     for projects eligible for funding under research and 
     commodity promotion programs. Matching funds are required if 
     the grant is for applied research that is commodity-specific 
     and not of national scope. Not more than 4 percent of the 
     funds made available for research can be used for 
     administrative costs. Research funds in the account shall not 
     be used for the construction of new buildings or the 
     acquisition, expansion, remodeling, or alteration of an 
     existing building, or in excess of 10 percent of the annual 
     allocation for commodity-specific projects not of national 
     scope.
       The Senate amendment provides that no monies from the Fund 
     may be used for an activity if the current level of 
     appropriation for the activity is less than 90 percent of the 
     1996 fiscal year appropriation for the specific activity 
     adjusted for inflation. (Section 507)
       The House bill has no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change the name of the Under Secretary for 
     Rural and Economic Development to the Under Secretary for 
     Rural Development and an amendment to make available 
     beginning on January 1, 1997, out of any funds in the 
     Treasury not otherwise appropriated $100,000,000 for fiscal 
     year 1997, $100,000,000 for fiscal year 1998, and 
     $100,000,000 for fiscal year 1999. The Secretary shall use 
     one-third of the funds made available to the Fund for a 
     fiscal year for rural development activities and one-third of 
     the funds made available to the Account for a fiscal year for 
     competitive research activities. The remaining one-third may 
     be used for either rural development or research at the 
     discretion of the Secretary.
       Rural development activities include the following programs 
     under the Housing Act of 1949: direct loans to low income 
     borrowers pursuant to section 502; loans for financial 
     assistance for housing for domestic farm laborers pursuant to 
     section 514; financial assistance for housing of domestic 
     farm labor pursuant to section 516; grants and contracts for 
     mutual and self help housing pursuant to section 
     523(b)(1)(A); grants for Rural Housing Preservation pursuant 
     to section 533; and Rural Rental Housing Assistance pursuant 
     to section 521. In addition, all rural development programs 
     including those authorized under the Consolidated Farm and 
     Rural Development Act; specified sections of the FACT Act of 
     1990; Title V of the Rural Development Act of 1972 and 
     specified sections of the Human Services Reauthorization Act 
     of 1986 and the Food Security Act of 1985.
       The Secretary shall conduct the specified rural development 
     programs in accordance with and subject to current program 
     authorities. Funds shall only be expended on programs that 
     received appropriations in fiscal year 1995. Not more than 20 
     percent of funds dedicated to all rural development 
     activities shall be expended on housing grant and loan 
     activities.
       Further, in any fiscal year, the Secretary shall not 
     announce the fiscal year's allocation for any program 
     pursuant to this section until one business day following the 
     day the appropriations bill for the fiscal year becomes law.
       The Secretary may use the funds in the account for grants 
     for research, extension and education to increase 
     international competitiveness, efficiency, and farm 
     profitability;

[[Page H2833]]

     reduce economic and health risks; conserve and enhance 
     natural resources; develop new crops, new crop uses, and new 
     agricultural applications of biotechnology; enhance animal 
     agricultural resources; preserve plant and animal germplasm; 
     increase economic opportunities in farming and rural 
     communities; and expand locally owned value added processing.
       The Secretary may make a grant to colleges and 
     universities, including land grant colleges and universities 
     with established programs of research, extension, or higher 
     education, Federal research agencies and national 
     laboratories, and private research organizations with 
     established and demonstrated capacity to perform research or 
     technology transfer.
       A grant made under this paragraph may be used by a grantee 
     for one or more of the following uses: outcome-oriented 
     research at the discovery end of the spectrum to provide 
     breakthrough results, exploratory and advanced development 
     and technology with well identified outcomes, national, 
     regional, or multi-State programs oriented primarily towards 
     extension programs and education programs demonstrating and 
     supporting the competitiveness of United States agriculture.
       Not less than 15 percent of the amounts made available 
     under this section for a fiscal year shall be awarded to 
     entities ranking in the lower one-third on the basis of 
     Federal research funds received from sources other than this 
     section.
       The Secretary shall establish criteria for allocating 
     grants based on the priorities for uses of funds in 
     consultation with the Advisory Board. The Secretary shall 
     seek and accept proposals for grants; determine the relevance 
     and merit of proposals through a system of peer and advisory 
     board review; and award grants on the basis of merit, 
     quality, and relevance to advancing the national research and 
     extension purposes.
       Research grants shall be awarded on a competitive basis. A 
     grant shall have a term that does not exceed 5 years.
       The Secretary shall require the funding of the grant with 
     equal matching funds from a non-Federal source if the grant 
     is for applied research that is commodity specific, and is 
     not of national scope.
       The Secretary shall administer this section through the 
     Cooperative State Research, Education, and Extension Service 
     of the Department of Agriculture.
       Funds shall be available for obligation for a 2 year 
     period, except the Secretary may use not more than 4 percent 
     of the funds made available under this paragraph for 
     administrative costs incurred by the Secretary. Furthermore, 
     funds made available for research grants shall not be used 
     for the construction of a new building or the acquisition, 
     expansion, remodeling, or alteration of an existing building 
     (including site grading and improvement and architect fees). 
     (Sections 793 and 794)
     Rural development component
       The Managers intend, under Subsection (c)(1)(B), that 
     established rural development programs with current authority 
     under the Consolidated Farm and Rural Development Act, 
     specified sections of the FACT Act of 1990, Title V of the 
     Rural Development Act of 1972, and specified sections of the 
     Food Security Act and the Human Services Reauthorization Act 
     of 1986 regarding intermediary lending, be eligible for funds 
     made available under the Fund for Rural America. These 
     programs include the water and waste disposal loan and grant 
     programs, the community facilities loan and grant programs, 
     the solid waste management grant program, the rural water and 
     waste technical assistance and training program, the distance 
     learning and telemedicine program, the rural cooperative 
     development grant program, the rural business opportunity 
     grant program, the business and industry guarantee program, 
     the rural business enterprise grant program, activities of 
     the Alternative Agricultural Research and Commercialization 
     Corporation, the intermediary relending program, the 
     downpayment program for beginning farmers, rural cooperative 
     development grant program, and grants for outreach and 
     technical assistance for socially disadvantaged farmers and 
     ranchers program.
       The Managers are concerned about the backlog of water and 
     wastewater program applications which, according to USDA 
     reports, is as high as $3 billion. The Managers expect that 
     the Secretary make satisfying these outstanding needs a 
     priority with respect to the Fund for Rural America.
       A continuing resolution that provides appropriations in a 
     fiscal year for the Department of Agriculture meets the same 
     conditions of allowing the Secretary to announce program 
     allocations from the Fund. The Managers intend the Secretary 
     to make such allocations in a manner to provide additional 
     funding to appropriation acts.
     Research Component
       It is the intent of the Managers that the uses of the fund 
     could include consideration of genome mapping projects which 
     may lead to increases in international competitiveness.
       The Managers support high-quality, peer reviewed 
     biotechnology research with practical applications carried 
     out by consortia of public and private universities and 
     companies and selected through a competitive process. The 
     Managers intend that such a consortia be considered eligible 
     grantees for assistance under the research component of the 
     Fund for Rural America.
       The managers intend that the eligibility for National 
     Laboratories to compete for grants under the Fund for Rural 
     America is an outgrowth of the Memorandum of Understanding 
     (MOU) signed between the Department of Agriculture (USDA) and 
     the Department of Energy (DOE) in November, 1995. The 
     managers encourage the National Laboratories to continue 
     their efforts in a cooperative manner with the agricultural 
     community. It is the intent of the managers that the USDA and 
     DOE continue their efforts to meet the objectives outlined in 
     the recent MOU.
       Further, it is the intent of the Managers that the 
     independent review by the advisory board should facilitate 
     better communication between the scientific community and the 
     end user of their products. Therefore, the decision to fund 
     proposed projects under the research component of the Fund 
     for Rural America will be determined by the program 
     administrator based on recommendations of the peer review 
     panel and the advisory board. The peer review panel will 
     review the scientific merit of the proposal. The advisory 
     board will review the proposal based on the purposes and 
     objectives established in the request for proposal. The 
     advisory board shall have flexibility to establish their 
     procedures.

    Title VIII--Agricultural Research, Extension and Education Title


Subtitle A--Modification and Extension of Activities Under the 1977 Act

     (1) Purposes of agricultural research, extension and 
         education.
       The Senate amendment revises the list of purposes of 
     federally supported agricultural research, extension, and 
     education in Section 1402 of the National Agricultural 
     Research, Extension, and Teaching Policy Act (NARETPA) of 
     1977. (Section 801)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment making technical changes. (Section 801)
       The Managers encourage the Secretary to consider the 
     benefits of conservation tillage and agricultural 
     biotechnology as significant components of USDA's 
     agricultural research, extension and education programs to 
     conserve natural resources.
     (2) National Agricultural Research, Extension, Education and 
         Economics Advisory Board.
       The Senate amendment amends Section 1408 of NARETPA of 1977 
     to establish the National Agricultural Research, Extension, 
     Education, and Economics Advisory Board (Board) and to 
     eliminate the authority for the National Agricultural 
     Research and Extension Users Advisory Board. The Board shall 
     consist of 25 members appointed by the Secretary and selected 
     from national farm, commodity, agribusiness, environmental, 
     consumer, and other organizations. The Secretary shall ensure 
     that full-time farmers and ranchers are included on the 
     Board. The duties of the Board are to advise the Secretary 
     and land grant colleges and universities regarding policies 
     and priorities and their effectiveness, the implementation of 
     the Government Performance Review Act, and the technology 
     review process. The Board is required to consult with persons 
     that will benefit from Federally-funded research, extension, 
     education, and economics. The term for Board members is 3 
     years. The Board is deemed to have filed a charter for 
     purposes of the Federal Advisory Committee Act. Authority for 
     the Board expires on September 30, 2002. (Section 804)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to increase the number of members from 25 to 30 
     and list the types of organizations from which members would 
     be selected. (Section 802)
       The Managers strongly encourage the Secretary to ensure 
     that the advisory board has at least five farmers or ranchers 
     as representatives. The Managers intend that the members of 
     the board described in this section as actively engaged in 
     the production of a plant or food animal commodity be full-
     time farmers or ranchers.
       The National Agricultural Research, Extension, Education 
     and Economics Board is intended to review and provide 
     consultation regarding priorities to both the Secretary and 
     land-grant colleges and universities. The Board is encouraged 
     to solicit opinions and recommendations from those who will 
     benefit from and use federally funded agricultural research, 
     extension, education and economics in an effort to ensure 
     that viewpoints of citizens and appropriate organizations are 
     taken into account when setting priorities. The Managers 
     intend that technology assessments should be conducted by a 
     group of qualified professionals. This new Advisory Board may 
     also review and provide input on the capacity and 
     coordination of research carried out on a regional basis, 
     particularly as it relates to strategic planning for the 
     Department.
     (3) Federal Advisory Committee Act Exemption for Federal-
         State Cooperative Programs
       The Senate amendment amends Section 1409A of NARETPA of 
     1977 to exempt groups composed of state cooperative 
     institution officials and employees and full-time federal 
     employees from FACA coverage. Meetings of such groups shall 
     be open to the public. Records of meetings, including 
     minutes, are required to be kept and made available to the 
     public upon request. (Section 806)
       The House bill contains no comparable provision.

[[Page H2834]]

       The Conference substitute adopts the Senate provision with 
     an amendment to add public universities and postsecondary 
     institutions. (Section 803)
       The managers intend that employees of Hispanic-Serving 
     Institutions can participate in cooperative efforts 
     concerning agricultural research, extension or education 
     which are exempt from FACA.
     (4) Coordination and Planning of Agricultural Research, 
         Extension and Education
       The Senate amendment requires the Secretary to develop a 
     system to monitor and evaluate agricultural research and 
     extension conducted or supported by the Federal government.
       For the activities of the Department that relate to food 
     safety, animal or plant health, research, education, or 
     technology transfer, the Secretary may transfer up to 5 
     percent of funds to an agency reporting to the Under 
     Secretary for Research, Education and Economics to address 
     imminent or emerging threats to food safety and animal and 
     plant health.
       Any committee, board, commision, panel, or task force 
     established solely to review proposals for funding under any 
     competitive research, extension, or education program is 
     exempted from Federal Advisory Committee Act requirements. 
     (Section 807)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to require an analysis of state of the art 
     information technology systems, require that the system be 
     developed to permit public access, and provide an 
     authorization for appropriations. The Conference substitute 
     also strikes the proposed 5% transfer authority. (Section 
     804)
       It is the intent of Congress that the Current Research 
     Information System (CRIS) and other program information 
     tracking systems used by Research, Extension and Education be 
     integrated into a Management Information System (MIS) that 
     tracks all research, extension and education programs that 
     receive funding from the USDA. This system will include 
     information about the goals, objectives, scope and current 
     status of these programs in a format that can be used to 
     report to Congress and that is consistent with the 
     requirements of the Government Performance Review Act. 
     Moreover, this MIS must be structured so that the Secretary 
     is able to report to Congress on the extent of activities 
     being funded for each of the purposes identified in Section 
     1402 of NARETPA of 1977. One component of this MIS shall be 
     designed so that the findings and accomplishments of USDA-
     funded research and extension programs are fully accessible 
     by the general public through on-line access, with full 
     search and retrieval capacities. Another component of this 
     MIS shall be designed so that researchers, extension agents 
     and specialists will be able to search and retrieve detailed 
     information on all USDA-funded research and extension 
     activities across the country, with the capacity to search 
     for projects and findings that are pertinent to their 
     agronomic, natural resource, and climatic parameters, as well 
     as the economic and social conditions of their state or 
     county.
       To develop a ``cutting edge'' MIS quickly and 
     expeditiously, it is understood that the Department will need 
     immediate access to highly qualified computer systems 
     specialists, theorists and technicians. The Congress expects 
     the Secretary to contract out the development of this MIS or 
     some subset of the project, with a university, a consortium 
     of universities, or the private sector. It is the expectation 
     of Congress that the USDA will set a goal that the MIS be 
     designed, implemented and fully functional within three years 
     of passage of this legislation.
       This section also provides an exemption from the Federal 
     Advisory Committee Act (FACA) for entities created solely to 
     review proposals for applications submitted for funding under 
     any competitive research, extension, or education program 
     carried out by the Secretary of Agriculture. The managers 
     understand that in addition to reviewing proposals and 
     applications for the purpose of evaluating them and making 
     award recommendations, entities that are exempted from FACA, 
     pursuant to this section also may render to the Secretary 
     program advice derived from such review process.
     (5) Grants and fellowships for food and agricultural sciences 
         education
       The Senate amendment amends Section 1417 of NARETPA of 1977 
     to permit the Secretary to provide higher education funds to 
     research foundations maintained by colleges and universities. 
     The Secretary may make capacity building grants to 1890 
     institutions for both teaching and research. The 
     authorization of appropriations is extended at the level of 
     $60 million through fiscal year 2002.
       Section 1417 of NAREPTA is further amended to require the 
     Secretary to promote and strengthen secondary education in 
     agriscience and agribusiness and to allow the Secretary to 
     make grants to public secondary education institutions, 2-
     year community colleges, and junior colleges to promote and 
     support agriscience and agribusiness education. The functions 
     and duties of the Secretary of Education regarding FFA are 
     transferred to the Secretary of Agriculture. (Section 808)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997 and strike the FFA 
     transfer from the Secretary of Education to the Secretary of 
     Agriculture. (Section 805)
     (6) Grants for research on the production and marketing of 
         alcohols and industrial hydrocarbons from agricultural 
         commodities and forest products
       The Senate amendment extends the authorization of 
     appropriation of $20 million for this research through 2002. 
     (Section 809)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 806)
     (7) Policy research centers
       The Senate amendment authorizes the Secretary to make 
     grants, competitive grants, and special research grants to 
     policy research centers for research and education programs 
     regarding the implications of public policies on the farm and 
     agricultural sectors; the environment; rural families and 
     economies; and consumers, food and nutrition. State 
     agricultural experiment stations, colleges and universities, 
     and other institutions and organizations are eligible to 
     receive grants. Funds may be used for research and education. 
     There are authorized to be appropriated such sums as are 
     necessary for fiscal years 1996 through 2002. (Section 810)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 807)
       In authorizing grants for policy analysis under this 
     section, the Managers acknowledge the valuable work of 
     several analytical institutes associated with universities. 
     At the same time, the Managers do not intend to confine the 
     universe of potential grantees to these institutions, or 
     indeed to universities generally.
       The Managers also note that policy analysis must be clear 
     about what it does and does not demonstrate. For example, an 
     analysis which describes the effect of a proposed policy 
     change on the incomes of agricultural producers, but does not 
     attempt to estimate the same policy change's effect on input 
     suppliers, processors, rural employment or total rural 
     economic activity, cannot give a complete picture of how the 
     policy change in question might affect rural America. The 
     analysis might be quite useful, but it is important that its 
     limitations be made clear. The principle here is that policy 
     analysis is helpful to the extent that policymakers--and the 
     public--understand both its uses and its limits.
       In identifying these possible weaknesses of current 
     analyses, the Managers do not intend to be critical of the 
     dedicated professionals who perform a valuable service in 
     analyzing a host of alternative policies. Rather, the 
     Managers intend to contribute to a healthy discussion of 
     whether current analytical conventions are adequate and 
     whether refinements and improvements might be made.
     (8) Human Nutrition Intervention and Health Promotion 
         Research Program
       The Senate amendment amends Section 1424 of NARETPA of 1977 
     to eliminate the unfunded authority for the Food Science and 
     Nutrition Research Center and replace it with authority for 
     the Secretary to award grants for a research initiative on 
     human nutrition intervention and health promotion. There are 
     authorized to be appropriated such sums as are necessary for 
     fiscal years 1996 through 2002. (Section 811)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997 and to authorize research 
     to combine medical and agricultural research. (Section 808)
       This section authorizes a multi-year research initiative on 
     human nutrition intervention and health promotion. In 
     carrying out research projects under this section, the 
     Secretary may take into account the unique opportunity 
     outlined in the Lower Mississippi Delta Development 
     Commission report which is currently being addressed by the 
     Department of Agriculture through the Agricultural Research 
     Service and Pennington Biomedical Research Institute at 
     Louisiana State University, Southern University at Baton 
     Rouge, Alcorn State University, the University of Southern 
     Mississippi, the University of Arkansas at Pine Bluff and the 
     Arkansas Children's Hospital Research Institute, all 
     operating as equal partners. In carrying out research 
     projects under this section, the Secretary may consider the 
     special nutritional needs of the rural elderly and take into 
     account the research being coordinated by Geisinger Medical 
     Center in Danville, Pennsylvania. In carrying out research 
     projects under this section, the Secretary may consider 
     designing and developing new foods to improve food production 
     and processing and to improve the nutritional quality of the 
     food supply.
     (9) Food and Nutrition Education Program
       The Senate amendment extends the authorization for 
     appropriation of $83 million for the Expanded Food and 
     Nutrition Education Program (EFNEP) through 2002. (Section 
     812)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 809)

[[Page H2835]]

     (10) Purposes and findings relating to animal health and 
         disease research
       The Senate amendment amends Section 1429 of NARETPA of 1977 
     to add food safety and animal well-being to the list of 
     purposes of animal health and disease research. (Section 813)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 810)
       Society periodically amends how it acts and reacts to 
     particular considerations. New terminology emerges over time 
     attempting to capture new trends, new thoughts, and new 
     considerations when describing a social condition. With 
     respect to interactions between humans and animals, the term 
     of art ``animal well-being'' has emerged replacing ``animal 
     welfare'' to various degrees in literature and language of 
     the day.
       The Managers recognize that the term ``animal well-being'' 
     can have slightly different interpretations. Therefore the 
     term ``animal well-being'' for the purposes of this Act shall 
     represent the basic efforts to assure proper care, treatment 
     and shelter of animals, and the elimination of unnecessary 
     cruel or painful treatment. However, the defining criteria 
     shall include efforts to include more specific clinical 
     criteria such as the evaluation of appetite, growth rate, 
     reproduction and production levels. In other words, utilize 
     tangible physical indicators or measurable endpoints to 
     interpret how the animal can ``communicate'' a status of 
     well-being to their human stewards.
     (11) Animal health and disease continuing research
       The Senate amendment extends the authorization of 
     appropriation of $25 million through 2002. The formula for 
     allocating funds among the States is amended to include the 
     value of and income from aquaculture. (Section 815)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 811)
     (12) Animal health and disease national or regional research
        The Senate amendment clarifies that research under section 
     1434 of NARETPA of 1977 may include pre-harvest and on-farm 
     food safety and animal well-being. The authorization for 
     appropriation is extended through 2002 at a level of $35 
     million. State agricultural experiment stations, colleges and 
     universities, and other organizations and institutions are 
     eligible for grants. Pre-harvest and on-farm food safety and 
     animal well-being are added to the list of problems that the 
     Secretary is required to prioritize annually. Any panel or 
     board created solely for reviewing applications under this 
     section is exempt from the Federal Advisory Committee Act. 
     (Section 816)
        The House bill contains no comparable provision.
        The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 812)
        This section also provides an exemption from the Federal 
     Advisory Committee Act (FACA) for entities created solely to 
     review proposals for applications submitted for funding. The 
     managers understand that in addition to reviewing proposals 
     and applications for the purpose of evaluating them and 
     making award recommendations, entities that are exempted from 
     FACA, pursuant to this section also may render to the 
     Secretary program advice derived from such review process.
     (13) Grant program to upgrade agricultural and food sciences 
         facilities at 1890 land-grant colleges
        The Senate amendment provides an authorization of 
     appropriation of $15 million through 2002 for the acquisition 
     and improvement of facilities, equipment, and libraries used 
     for agricultural and food sciences at 1890 institutions. 
     (Section 818)
       The House bill contains no comparable provision.
        The Conference substitute adopts the Senate provision to 
     change 2002 to 1997. (Section 813)
     (14) National Research and Training Centennial Centers 
         Programs, programs for Hispanic-serving institutions, and 
         international agricultural research and extension
        The Senate amendment extends the authorization for 
     appropriation of $2 million for competitive grants for five 
     national research and training centers located at 1890 
     colleges including Tuskegee University through 2002. (Section 
     819)
        The House bill contains no comparable provision.
        The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997 and to define Hispanic-
     serving institutions and to authorize education grants for 
     Hispanic-serving institutions and a technical amendment to 
     Section 1458(a)(8) of NARETPA of 1977. (Section 814, 815, and 
     816)
     (15) Authorization of Appropriations for Agricultural 
         Research Programs
        The Senate amendment extends authorization for 
     appropriation of $850 million for agricultural research 
     (Agricultural Research Service, animal health and disease, 
     and supplemental and alternative crops) through 2002. The 
     authorization for appropriation of $310 million for formula 
     funds (Hatch Act funds) for state agricultural experiment 
     stations is extended through 2002. (Section 821)
        The House bill contains no comparable provision.
        The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 817)
     (16) Authorization of appropriations for extension education
        The Senate amendment extends authorization for 
     appropriation of $460 million for Extension Service funding 
     through 2002. (Section 822)
        The House bill contains no comparable provision.
        The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 818)
     (17) Supplemental and alternative crops research
        The Senate amendment extends authorization for 
     appropriation of such sums as are necessary for research to 
     develop supplemental and alternative crops through 2002. 
     Subsections (b) and (c) of section 1473D of NARETPA of 1977 
     are amended to include in the research program under this 
     section the development of new commercial products derived 
     from natural plant materials for industrial, medical and 
     agricultural applications. References to the pilot project 
     are deleted since the program is no longer a pilot project. 
     (Section 823)
        The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 819)
     (18) Aquaculture Assistance Programs
        The Senate amendment repeals the requirement for an annual 
     aquaculture report by the Secretary to Congress. The 
     authorization for appropriation of $7.5 million for 
     aquaculture assistance programs, including research and 
     regional centers, is extended through 2002. The authorization 
     for appropriation of $500,000 for each of two specific 
     institutions for research on intensive water recirculating 
     aquaculture systems is extended through 2002. (Section 824)
        The House bill contains no comparable provision.
        The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997 and to add ornamental 
     fish to the definition of aquaculture in Section 1404(3) of 
     NARETPA of 1977. (Section 820)
     (19) Authorization of appropriations for rangeland research
       The Senate amendment extends the authorization for 
     appropriation of $10 million for rangeland research through 
     2002. (Section 825)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 821)


Subtitle B--Modification and Extension of Activities Under the 1990 Act

     (20) Water quality research, education, and coordination
       The Senate amendment repeals Subtitle G of title XIV of the 
     Food, Agriculture, Conservation and Trade Act of 1990. This 
     subtitle of the Conservation title authorized funds for the 
     development and implementation of a coordinated, integrated, 
     and comprehensive intra-agency program to protect waters from 
     contamination from agricultural chemical and production 
     practices, but was never funded. (Section 831)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 1997. 
     (Section 831)
     (21) National Genetics Resources Program
       The Senate amendment extends the authorization for 
     appropriation of such sums as necessary for the National 
     Genetics Resources Program through 2002 and allows the 
     Secretary to make genetic material available to other 
     countries. (Section 834)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 832)
     (22) National agricultural weather information system
       The Senate amendment extends the authorization for 
     appropriation of $5 million for the National Agricultural 
     Weather Information System through 2002. (Section 835)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 833)
     (23) Livestock Product Safety and Inspection Program
       The Senate amendment extends the authorization for 
     appropriation of such funds as necessary for the livestock 
     product safety and inspection program through 2002. (Section 
     838)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 834)
     (24) Plant Genome Mapping Program
       The Senate amendment repeals unused authority for a plant 
     genome mapping program. (Section 839)
       The House bill contains no comparable provision.

[[Page H2836]]

       The Conference substitute adopts the Senate provision with 
     an amendment to retain authority for the program. (Section 
     835)
     (25) Certain Specialized Research Programs
       The Senate amendment repeals authority for specialized 
     research projects. The projects authorized under this section 
     were not funded under this authority. (Section 840)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to retain authority for ethanol and aflatoxin 
     research, and to extend authorization for mesquite, prickly 
     pear, and deer tick ecology and related research to 1997. 
     (Section 836)
     (26) Agricultural Telecommunications Program
       The Senate amendment extends the authorization for 
     appropriation of $12 million to encourage the development of 
     an agricultural communications network to facilitate and 
     strengthen education, extension, research and domestic and 
     international marketing through 2002. (Section 841)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 837)
     (27) National centers for agricultural product quality 
         research
       The Senate amendment extends the authorization for 
     appropriation of such sums as necessary for grants to centers 
     for research, development and education programs on food 
     safety and wholesomeness through 2002. (Section 842)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997 and to modify purposes 
     and delete requirement for submission of plan to Congress. 
     (Section 838)
       It is the intention of Managers that this section be 
     broadly interpreted to establish a competitive, applied 
     research grants program, facilitating industry partnerships 
     and supporting a broad spectrum of research, development, and 
     education programs to enhance global competitiveness through 
     improvements in product quality and competitiveness.
       Through this program, the Managers seek to stimulate public 
     and private investment in productive and competitive segments 
     of agriculture and to maximize the cost effectiveness of that 
     research.
     (28) Red meat safety research center authorization and turkey 
         research center
       The Senate amendment repeals authority for a turkey 
     research center which has not been funded. (Section 843)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to add an authorization for a red meat safety 
     research center. (Section 839)
       The United States has the safest food supply in the world. 
     However, the managers recognize the need for red meat safety 
     research. Currently the Department of Agriculture supports 
     several high quality research centers. It is the intent of 
     the Managers that a facility, dedicated to red meat safety 
     research, be competitively established at an existing 
     facility or a new facility and that it augment, not 
     duplicate, current research already being done on red meat 
     safety.
       The Managers are also particularly interested that this 
     facility have the ability to interact with national 
     organizations and private livestock packing plants in 
     carrying out their research.
     (29) Indian Reservation Extension Agent Program
       The Senate amendment reauthorizes the Reservation Extension 
     Agent Program, established under Section 1677 of the Food, 
     Agriculture, Conservation and Trade Act of 1990 through 2002. 
     On a determination by the Secretary that a program has been 
     satisfactorily administered for two years, the Secretary 
     shall implement a reduced application process in order to 
     reduce regulatory burdens on participating university and 
     tribal entities. (Section 555 of Title V)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to strike the 2002 authorization date since the 
     program is permanently authorized. (Section 840)
     (30) Assistive Technology Program for farmers with 
         disabilities
       The Senate amendment extends the authorization for 
     appropriation of not less than $5 million for grants to 
     support programs providing on-farm agricultural education and 
     assistance to individuals with disabilities who are engaged 
     in farming through 2002. The authorization for appropriation 
     of $1 million for competitive national grants for technical 
     assistance, training and information dissemination is 
     extended through 2002. (Section 846)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 841)
     (31) National rural information center clearinghouse
       The Senate amendment extends the authorization for 
     appropriation of $500,000 for the National Rural Information 
     Center Clearinghouse within the National Agricultural Library 
     through 2002. (Section 848)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 842)
     (32) Global climate change
       The Senate amendment extends the authorization for 
     appropriation of such sums as necessary for a global climate 
     change program is extended through 2002. (Section 849)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 843)


        Subtitle C--Repeal of Certain Activities and Authorities

     (33) Subcommittee on Food, Agricultural, and Forestry 
         Research
       The Senate amendment repeals authority for the Subcommittee 
     on Food, Agricultural, and Forestry Research of the Federal 
     Coordinating Council For Science, Engineering, and 
     Technology. (Section 802)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 851)
     (34) Joint Council on Food and Agricultural Sciences
       Authority for the Joint Council on Food and Agricultural 
     Sciences is repealed. (Section 803)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 852)
     (35) Agricultural Science and Technology Review Board
       The Senate amendment repeals authority for the Agricultural 
     Science and Technology Review Board. (Section 805)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 853)
     (36) Animal Health Science Research Advisory Board
       The Senate amendment repeals authority for the Animal 
     Health Science Research Advisory Board. (Section 814)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 854)
     (37) Resident Instruction Program at 1890 Land-Grant Colleges
       The Senate amendment repeals Section 1446 of NARETPA of 
     1977 which provides for grants for teaching programs at 1890 
     institutions. This section was never funded. (Section 817)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 855)
     (38) Grants to States for international trade development 
         centers
       The Senate amendment repeals Section 1458A of NARETPA of 
     1977. This section authorizes the Secretary to make grants 
     for the establishment of International Trade Development 
     Centers, but was not funded. (Section 820)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 856)
     (39) Rangeland Research and Composting Research and Extension 
         Program
       The Senate amendment repeals the requirement for an annual 
     rangeland research report. The authority for the Rangeland 
     Research Advisory Board is repealed. (Section 825)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to repeal the composting research and extension 
     program. (Sections 857 and 858)
     (40) Education program regarding handling of agricultural 
         chemicals and agricultural chemical containers
       The Senate amendment repeals authority for an unfunded 
     program to catalogue the federal, state, and local laws and 
     regulations for handling unused or unwanted agricultural 
     chemical containers. (Section 832)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 859)
     (41) Program administration regarding sustainable agriculture 
         research and education
       The Senate amendment repeals authority for the National 
     Sustainable Agriculture Advisory Council and a requirement 
     for an annual report. (Section 833)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 860)
     (42) Research regarding production, preparation, processing, 
         handling, and storage of agricultural products
       The Senate amendment repeals Subtitle E of title XVI of the 
     Food, Agriculture, Conservation and Trade Act of 1990. The 
     food safety research and grant program authorized by this 
     subtitle has not been funded. (Section 836)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 861)

[[Page H2837]]

     (43) Plant and animal pest and disease control program, 
         specialized research programs, and commission on 
         agricultural research facilities
       The Senate amendment repeals Subtitle F of title XVI of the 
     Food, Agriculture, Conservation and Trade Act of 1990. 
     Integrated pest management (IPM) research authorized under 
     this subtitle has been funded under other authorities. 
     (Section 837)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to repeal animal lean content research, 
     immunoassay research, niche market development research, 
     scrapie research, and new commercial products from natural 
     plant materials research and to repeal Commission on 
     Agricultural Research Facilities from Section 1674 of the 
     FACT Act. (Section 862, 863, and 864)
     (44) Special grant to study constraints on agricultural trade
       The Senate amendment repeals the authority for at least two 
     grants to study the impacts of technical barriers, quality 
     factors and end-use characteristics in agricultural trade, 
     which has not been funded. (Section 865)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 865)
     (45) Pilot project to coordinate food and nutrition education 
         programs
       The Senate amendment repeals authority for a pilot project 
     for grants to not less than two states for food and nutrition 
     education programs, which has not been funded. (Section 845)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 866)
     (46) Demonstration areas for rural economic development
       The Senate amendment repeals authority for grants to rural 
     areas to serve as demonstration areas for rural economic 
     development, which has not been funded. (Section 847)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 867)
     (47) Technical advisory committee regarding global climate 
         change
       The Senate amendment repeals authority for a technical 
     advisory committee, which has not been funded. (Section 849)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 868)
     (48) Committee of Nine under Hatch Act of 1887
       The Senate amendment deletes authority for the Committee of 
     Nine from the Hatch Act. (Section 864)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 869)
     (49) Cotton crop reports
       The Senate amendment repeals the requirement that cotton 
     crop production reports be issued at 3:00 p.m. (Section 867)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 870)
     (50) Rural Economic and Business Development and Additional 
         Research Grants Under Title V of Rural Development Act of 
         1972
       The Senate amendment amends Section 502 of the Rural 
     Development Act of 1972 to repeal authority for an Extension 
     Service rural economic and business development program to 
     enable states or counties to employ specialists, which has 
     not been funded (section 502(g)). Authority for a competitive 
     grant program for rural development research, which has not 
     been funded, is repealed (section 502(j)). (Section 868)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 871)
     (51) Human nutrition research
       The Senate amendment repeals a requirement for an annual 
     report on human nutrition research activities. (Section 869)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 872)
     (52) Grants to upgrade 1890 land-grant college extension 
         facilities and indian subsistence farming demonstration 
         grant program
       The Senate amendment repeals obsolete authority for a 
     program to upgrade 1890 land-grant college extension 
     facilities. (Section 871)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to repeal the Indian Subsistence Farming 
     Demonstration Grant Program. (Section 873 and 874)


             Subtitle D--Miscellaneous Research Provisions

     (53) Critical agricultural materials research
       The Senate amendment extends the authorization of 
     appropriation for the Critical Agricultural Materials Act 
     through 2002. The requirement for an annual report is 
     eliminated. (Section 861)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 881)
     (54) 1994 institutions
       The Senate amendment extends the authorization of 
     appropriation of $4.6 million for providing land grant status 
     to 29 tribal colleges (referred to as 1994 institutions) 
     through 2002. The authorization of appropriation of $1.7 
     million for institutional capacity building grants for 1994 
     institutions is extended through 2002. (Section 862)
       The House bill contains no comparable provision.
       The Conference substitute adopts the House provision, 
     striking the Senate provision.
     (55) Memorandum of agreement regarding 1994 institutions
       The Senate amendment states that by January 6, 1997, the 
     Secretary shall develop and implement a Memorandum of 
     Agreement with the 29 tribally controlled colleges to ensure 
     that tribally-controlled colleges and Native American 
     communities equitably participate in Department of 
     Agriculture employment programs, services and resources. 
     (Section 555 of Title V)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 882)
     (56) Smith-Lever Act Funding for 1890 Land-Grant Colleges, 
         Including Tuskegee University
       The Senate amendment amends Section 3(d) of the Smith-Lever 
     Act to make colleges or universities eligible to receive 
     funding under the Act of August 30, 1890, including Tuskegee 
     University, or Section 208 of the District of Columbia Public 
     Postsecondary Education Reorganization Act, eligible for 
     Extension funding under Smith-Lever 3(d) programs. This 
     change applies after FY95 to any increases in funding for 
     existing Smith-Lever 3(d) programs and to all new Smith-Lever 
     3(d) programs. A conforming amendment is made to section 
     1444(a) of NARETPA of 1977 and to the District of Columbia 
     Public Postsecondary Education Reorganization Act to clarify 
     that this change would not result in a reduction of other 
     Extension Service funding to these colleges and universities. 
     (Section 863)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to remove the reference to Section 208 of the 
     District of Columbia Public Postsecondary Education 
     Reorganization Act. (Section 883)
     (57) Agricultural Research Facilities
       The Senate amendment amends the Research Facilities Act.
       Section 1 is the short title.
       Section 2 contains new definitions for ``Agricultural 
     Research Facility'' and ``Food and Agricultural Sciences''.
       Section 3 establishes the process for reviewing proposals 
     for agricultural research facilities. Subsection (a) requires 
     proposals to be submitted to the Secretary and the Secretary 
     is required to review proposals in the order in which they 
     are received. Subsection (b) requires the Secretary to 
     establish the application procedure in consultation with the 
     Senate and House Appropriations Committees. Subsection (c) 
     requires all proposals for new funding for agricultural 
     research facilities at colleges, universities or non-profit 
     institutions to be reviewed by USDA to determine whether they 
     meet the following criteria:
       the availability of at least a 50% non-Federal match in 
     cash;
       the facility must not be duplicative of existing 
     facilities;
       the facility must serve the national research priorities 
     established in section 1402 of NARETPA of 1977 and regional 
     needs;
       the college, university, or non-profit institution 
     supporting the facility must demonstrate the commitment to 
     long-term support for operating the facility and conducting 
     research; and
       the facility must reflect the strategic plan for federally 
     supported research facilities established in section 4. 
     Subsection (d) requires the Secretary to review proposals 
     within 90 days and report the results of the evaluation and 
     assessment to the Senate and House Appropriations Committees.
       Section 4 requires the Secretary to develop a ten-year 
     strategic plan for the development, construction, 
     modernization, consolidation, and closure of federally 
     supported research facilities. The plan should reflect the 
     need to increase the productivity of and to enhance the 
     competitiveness of the U.S. agricultural and food industry. 
     It should also reflect the findings of the National Academy 
     of Sciences with respect to programmatic and scientific 
     priorities relating to agriculture.
       Section 5 exempts panels or board created solely to review 
     proposals from the Federal Advisory Committee Act.
       Section 6 authorizes the appropriation of such sums as 
     necessary for fiscal years 1996 through 2002 for the study, 
     plan, design, structure and related costs of such facilities. 
     Administrative costs are limited to 3 percent of the cost of 
     the project.
       The new review process would not apply to projects for 
     which funds were appropriated for a feasibility study or for 
     any phase of the project prior to October 1, 1995, but such 
     projects would be included in the strategic

[[Page H2838]]

     plan. The strategic plan required by Section 4 shall apply to 
     all federally supported agricultural research facilities, 
     including those funded prior to the effective date of this 
     title.
       Subsection (b) amends section 1431 of NARETPA of 1985 to 
     extend the authorization for appropriation for Federal 
     research facilities to 2002 and to delete the requirement for 
     an annual report on Federal research facilities. (Section 
     865)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997; to require consultation 
     with the House and Senate Agriculture Committees; and to 
     delete the requirement for the Secretary to develop a 10-year 
     strategic plan for the development, construction, 
     modernization, consolidation and closure of federally 
     supported research facilities and instead to require the 
     formation of a task force to be appointed from the Advisory 
     Board membership (established by Section 802 of this Act) as 
     well as others demonstrating appropriate expertise to prepare 
     the strategic plan within two years for the development, 
     modernization, construction, consolidation, and closure of 
     federal agricultural research facilities and agricultural 
     research facilities proposed to be constructed with federal 
     funds. (Section 884)
       This section requires that all proposals for new funding 
     for agricultural research facilities at colleges, 
     universities or non-profit institutions be reviewed by USDA 
     to determine whether they meet specified criteria. The 
     Managers intend that feasibility studies completed more than 
     two fiscal years prior to enactment but not provided further 
     funding should go through this new review process if federal 
     funding is still being sought. While an exemption from FACA 
     is provided for a panel formed to review the proposals under 
     section 5 of the Research Facilities Act, the Managers are 
     not requiring that such a panel be formed. This section 
     provides an exemption from the Federal Advisory Committee Act 
     (FACA) for entities created solely to review proposals for 
     applications submitted for funding. The Managers understand 
     that in addition to reviewing proposals and applications for 
     the purpose of evaluating them and making award 
     recommendations, entities that are exempted from FACA, 
     pursuant to this section also may render to the Secretary 
     program advice derived from such review process.
     (58) National competitive research initiative
       The Senate amendment extends the authorization for 
     appropriation of $500 million for a competitive grant program 
     for basic and applied research open to all researchers 
     through 2002. The requirement that not less than 20% of 
     appropriated funds shall be available to make grants for 
     mission-linked systems research is increased to 40%. Funds 
     will be available for a two-year period to allow for the 
     award of grants in a more orderly manner. (Section 866)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change 2002 to 1997. (Section 885)
       The Secretary is encouraged to consider grants to mission-
     linked research which contribute to the development of 
     applied technologies and information which increase the 
     profitability of farms and ranches and increase economic 
     opportunities for rural communities.
     (59) Rural development research and education
       The Senate amendment amends Section 502 of the Rural 
     Development Act of 1972 to clarify that rural development 
     Extension programs shall also promote coordinated and 
     integrated rural community initiatives that advance and 
     empower capacity building. (Section 868)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 886)
       This section makes clear that the Secretary can establish a 
     national rural development program supported by the 
     Cooperative State Research, Education, and Extension Service 
     that provides national focus and local implementation for an 
     efficient and effective delivery of training, technical 
     assistance, and applied research. Such programs may address 
     rural challenges in the areas of leadership development, 
     entrepreneurship, business development and management 
     training which stimulate small and rural communities to 
     increase jobs, income and quality of life.
     (59) Dairy goat research program and research to eradicate 
         and control brown citrus aphid and citrus tristeza virus
       The Senate amendment repeals authority for a grant to one 
     1890 land grant institution for dairy goat research, which 
     has not been funded. (Section 870)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to retain authority for dairy goat research 
     through 1997 and with an amendment to add an authorization 
     for competitive grants for research to eradicate and control 
     brown citrus aphid and citrus tristeza virus. (Sections 887 
     and 888)
     (60) Stuttgart National Aquaculture Research Center
       The Senate amendment amends Public Law 85-132 of March 15, 
     1958 to transfer the Fish Farming Experimental Laboratory in 
     Stuttgart, Arkansas from the Department of the Interior to 
     the Department of Agriculture and to rename it the Stuttgart 
     National Aquaculture Research Center. All personnel, assets, 
     liabilities, contracts, real and personal property, records, 
     and the unexpended balance of appropriations, authorizations, 
     allocations, and other funds are transferred. This research 
     center shall be complementary to, and not duplicative of, 
     facilities of colleges, universities, nonprofit institutions, 
     and ARS facilities. (Section 872)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 889)
     (61) National aquaculture policy, planning, and development
       The Senate amendment amends the National Aquaculture Act of 
     1980.
       Subsection (a) amends the definition of aquaculture and 
     adds a definition of private aquaculture.
       Subsections (b) and (c) designate USDA as the lead agency 
     for aquaculture.
       Subsection (e) establishes a national policy for private 
     aquaculture and requires the Secretary to develop and 
     implement a Department of Agriculture Aquaculture Plan for 
     coordinating and implementing aquaculture activities and 
     programs within the Department and supporting the development 
     of private aquaculture. The Secretary is also authorized to 
     maintain and support a National Aquaculture Information 
     Center at the National Agricultural Library. The Secretary is 
     directed to treat private aquaculture as agriculture and is 
     directed to coordinate interdepartmental functions and 
     activities relating to private aquaculture.
       Subsection (f) authorizing appropriations of $1 million for 
     each of the Departments of Agriculture, Commerce and Interior 
     is extended through 2002. (Section 873)
       The House bill contains no comparable provision.
       The Conference substitute adopts the House provision, 
     striking the Senate provision.
     (62) Expansion of authorities related to the National 
         Arboretum, Transfer of Aquacultural Research Center, and 
         use of remote sensing data
       The Senate amendment expands the authorities of the 
     National Arboretum to allow it to benefit from proceeds 
     resulting from concession fees, disposition of excess 
     properties, fees from the commercial use of facilities and 
     grounds, and license use of the National Arboretum name and 
     logo. Any funds received from these activities are to be held 
     in a special account for the use of the National Arboretum as 
     the Secretary considers appropriate. (Section 874)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to permit the transfer of the Southeastern Fish 
     Culture Laboratory in Marion, Alabama to USDA; and to direct 
     the Secretary and the Administrator of NASA to work together 
     to provide farmers with timely information through remote 
     sensing. (Sections 890, 891, and 892)
       In addition to NASA, the managers encourage the Secretary 
     to continue cooperative efforts with the Department of Energy 
     (DOE). The managers support the Memorandum of Understanding 
     that was signed between the Department of Agriculture (USDA) 
     and the DOE in November 1995. It is the intent of the 
     managers that the cooperative efforts of the DOE and USDA 
     continue.
     (63) Study of Agricultural Research Service
       The Senate amendment directs the Secretary to request the 
     National Academy of Sciences to conduct a study on the role 
     and mission of the Agricultural Research Service. The study 
     is to review the mission of federal research conducted by 
     ARS, evaluate the strength of ARS science and its relevance 
     to national priorities, and examine how the agency's work 
     relates to the capacity of the U.S. agricultural research, 
     education and extension system overall. The report is to be 
     completed within 18 months of the date of enactment. The 
     Secretary is directed to make not more than $500,000 of ARS 
     funds available for the report. (Section 875)
       The House bill contains no comparable provision.
       The Conference substitute adopts the House provision, 
     deleting the Senate provision.
     (64) Sense of the Senate regarding methyl bromide and general 
         funding authority for research, extension and education
       The Senate amendment states it is the sense of the Senate 
     that the Department of Agriculture should continue to make 
     methyl bromide alternative research and extension activities 
     a high priority of the Department and that the Department of 
     Agriculture, the Environmental Protection Agency, producer 
     and processor organizations, environmental organizations and 
     state agencies should continue their dialogue on the risks 
     and benefits of extending the 2001 phaseout deadline. 
     (Section 877)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to provide general funding authority for 
     research, extension and education activities and initiatives 
     for fiscal years 1998 through 2002. (Sections 893, 897 and 
     898)

[[Page H2839]]

       The conference agreement includes provisions that, for 
     fiscal years 1998 through 2002, would direct the Secretary to 
     conduct such research, education, and extension activities as 
     are specifically funded in appropriations acts, and that 
     would authorize the appropriations of such sums as are 
     necessary to carry out such activities and initiatives. As 
     indicated elsewhere, the Managers also have agreed that each 
     of the authorizations of appropriations for agricultural 
     research, extension or education programs or activities 
     contained in this title shall be extended only through fiscal 
     year 1997. The Managers intend that these combined actions 
     will provide Congress and the Executive branch a fresh 
     opportunity to conduct a thorough and comprehensive review of 
     the federal agricultural research, extension and education 
     programs and authorities. Our purpose is to revise these 
     programs and authorities as necessary to ensure that the 
     needs of the nation, and in particular the agriculture 
     sector, are met as we transition into a new era. The Managers 
     intend that this review be completed and that comprehensive 
     legislation be enacted by the end of fiscal year 1997.
     (65) Miscellaneous research concerns
       The Managers recognize the importance of continuing 
     research to find alternatives to grass burning used by the 
     grass seed industry.
       The Managers believe that research and education to enhance 
     soil quality and thus human and animal health are important. 
     These research and education efforts should begin to address 
     our understanding of the interrelationship between soil 
     quality, food quality and overall health.
       In recognizing that our nation's soil resources affect 
     multiple priorities including farm productivity, water and 
     air pollution, food quality and natural resource enhancement 
     as well as human and animal health, the Managers encourage 
     continuing efforts to develop standardized field and 
     laboratory methods to measure and interpret changes observed 
     in soil quality indicators across fields, farms and 
     watersheds.
       The Managers recognize that there have been exciting and 
     promising advances made in agricultural areas including 
     perennial grain polyculture ecosystems; high seed yield; 
     management of insects injurious to plants, plant pathogens 
     and weeds; nitrogen fertility provided by legumes; minimizing 
     soil erosion, use of fossil fuels and synthetic chemicals; 
     and enhancement of soil quality. The Managers believe that 
     research in these areas would be eligible to compete for 
     competitive research funding.
     (66) Agriculture weather service centers
       The collection, quality, and reporting of agricultural 
     weather data should remain a federal responsibility. Without 
     federal responsibility to collect and distribute weather 
     data, the specialized forecasts and private sector 
     agricultural weather services may not remain viable.
       Furthermore, it is the belief of the Managers that it has 
     not been properly demonstrated that the private sector is 
     ready to assume responsibility of agricultural weather data 
     collection and dissemination. The managers encourage the 
     National Weather Service (NWS) to recognize the value of the 
     Agriculture Weather Service Centers.
       The Department of Agriculture is familiar with farming and 
     the collection and dissemination of weather data. Therefore 
     the managers believe that the Department of Agriculture is 
     the most suitable agency for this service. The Department has 
     an ongoing relationship with the land-grant colleges and 
     universities, and via the extension service, can ensure that 
     this information is made available to all producers. 
     Therefore, the Managers encourage the NWS to work 
     cooperatively with the Department to explore ways to continue 
     to provide agricultural weather data and transfer this 
     responsibility to the Department of Agriculture. The Managers 
     request the NWS and the Department of Agriculture to report 
     on the status of Agriculture Weather Service Centers to the 
     Congressional Committees on Agriculture not later than 30 
     days after enactment of this Act.
       Until such time that action can be taken on the transfer of 
     the Agriculture Weather Service to the Department of 
     Agriculture, the Managers request that this important and 
     essential service be continued through the Commerce 
     Department, and the Department of Agriculture contract for 
     this service. Additionally, the Managers request that the 
     funding for this service continue through Commerce, State, 
     Justice appropriations.

                        Title IX--Miscellaneous


     SUBTITLE A--COMMERCIAL TRANSPORTATION OF EQUINE FOR SLAUGHTER

       The Senate amendment establishes requirements for the 
     commercial transportation of equine for slaughter.
       Section 521 sets forth findings. Congress finds that, to 
     ensure that equine sold for slaughter are provided humane 
     treatment and care, it is essential to regulate the 
     transportation, care, handling, and treatment of equine by 
     any person engaged in the commercial transportation of equine 
     for slaughter.
       Section 522 defines commerce, Department, equine, equine 
     for slaughter, foal, intermediate handler, person, Secretary, 
     vehicle, and stallion.
       Section 523 directs the Secretary, subject to the 
     availability of appropriations, not later than 1 year after 
     the date of enactment of this subtitle, to issue, by 
     regulation, standards for the humane commercial 
     transportation by vehicle of equine for slaughter.
       A person engaged in the regular business of transporting 
     equine by vehicle for slaughter as part of a commercial 
     enterprise, is prohibited, from transporting horses to 
     slaughter except in accordance with the standards and this 
     subtitle.
       This section establishes minimum requirements for the 
     humane handling, care, treatment, and equipment necessary to 
     ensure the safe and humane transportation of equine for 
     slaughter, including period of time in transport and vehicle 
     requirements. All equine for slaughter must be fit to travel 
     as defined by an accredited veterinarian who shall prepare a 
     certificate of inspection. No equine for slaughter shall be 
     accepted by a slaughter facility unless the equine is 
     inspected on arrival and is accompanied by a certificate of 
     inspection.
       Section 524 outlines the record keeping procedures required 
     for transportation of equine to slaughter.
       Section 525 states that an act or omission of an employee 
     of a person engaged in the business of transporting equine 
     for slaughter shall be considered an act or omission of the 
     employer as well as the employee. This section also requires 
     that if an equine suffers a substantial injury or illness 
     while being transported for slaughter on a vehicle, the 
     driver of the vehicle shall seek prompt assistance from a 
     licensed veterinarian.
       Section 526 authorizes the Secretary to cooperate with 
     States, political subdivisions of States, State agencies 
     (including State departments of agriculture and State law 
     enforcement agencies), and foreign governments to carry out 
     and enforce this subtitle (including regulations issued under 
     this subtitle).
       Section 527 authorizes the Secretary to conduct such 
     investigations or inspections as the Secretary considers 
     necessary to enforce this subtitle (including any regulation 
     issued under this subtitle), establishes guidelines for the 
     investigations, and permits employees or agents of the 
     Department to provide assistance to or destroy any equine 
     found suffering.
       Section 528 establishes penalties for interfering with 
     enforcement of the act.
       Section 529 establishes judicial jurisdiction for cases 
     arising from this act.
       Section 530 establishes civil and criminal penalties for 
     violations of this Act or regulations.
       Section 531 states that, from sums received as penalties, 
     fines, or forfeitures of property for any violation of this 
     subtitle (including a regulation issued under this subtitle), 
     the Secretary shall pay the reasonable and necessary costs 
     incurred by any person in providing temporary care or medical 
     assistance for any equine that needs the care or assistance 
     due to a violation.
       Section 532 states that nothing in this subtitle prevents a 
     State from enacting or enforcing any law (including a 
     regulation) that is not inconsistent with this subtitle or 
     that is more restrictive than this subtitle.
       Section 533 authorizes appropriations to carry out the act. 
     No provision of this subtitle shall be effective or enforced 
     during a fiscal year unless funds have been appropriated. 
     (Subtitle C of Title V)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment authorizing the Secretary of Agriculture because 
     of the unique and special needs of equine being transported 
     to slaughter, subject to the availability of appropriations, 
     to issue guidelines for the regulation of persons regularly 
     engaged in the commercial transportation of equine for 
     slaughter within the U.S. Among the issues the Secretary 
     shall review are the food, water and rest provided to equine 
     in transit and the segregation of stallions from other equine 
     during transit. (Sections 901-905)
        It is the intent of the Managers that the object of any 
     prospective regulation on this matter will be the individual 
     or company which regularly engages in the commercial 
     transport of equine to slaughter, and will not extend to 
     individuals or others who periodically transport equine for 
     slaughter outside of their regular activity.
        It is the intent of the Managers that the Secretary of 
     Agriculture to the maximum extent possible employ performance 
     based standards rather than engineering based standards when 
     establishing guidelines for the regulation of commercial 
     transportation of equine species to slaughter.
        The Managers intend that the Secretary of Agriculture's 
     authority to issue guidelines for regulation is restricted 
     solely to the commercial transportation of equine to a 
     slaughter facility. Also, it is not the intention of the 
     Managers for the Secretary to inhibit the commercially viable 
     transport of equine to slaughter facilities.
        It is the clear intent of the Managers that no 
     authorization of authority under this section may be 
     construed to give the Secretary authority to regulate the 
     routine or regular transportation of non-slaughter equine. 
     Further, it is the clear intent of the Managers that no 
     authorization of authority under this section may be 
     construed to give the Secretary authority to regulate the 
     routine or regular transportation of any other livestock, 
     including poultry, to a slaughter facility or any other 
     destination or by any conveyance.

[[Page H2840]]

                     Subtitle B--General Provisions

     (1) Livestock Dealer Trust, Interstate Quarantine, Cotton 
         Classification Services, and Plant Variety Protection Act
        The Senate amendment amends Title III of the Packers and 
     Stockyards Act of 1921 and establishes a statutory trust for 
     the benefit of livestock sellers who sell to livestock 
     dealers and market agencies which buy on commission. To 
     ensure prompt payment of livestock sellers, all livestock 
     purchased in cash sales by a dealer or market agency buying 
     livestock on commission shall have all related property 
     (i.e., livestock, receivables or proceeds) held in a 
     ``floating'' trust until the unpaid seller receives full 
     payment.
       Unpaid sellers lose benefit of the trust if payment has not 
     been received within 30 days of the final date for payment, 
     or within 15 business days after the seller learns that the 
     payment instrument presented has been dishonored. To preserve 
     the trust, written notice on non-payment must be given to the 
     dealer or market agency and a notice filed with the 
     Secretary. Dealers or market agencies buying on commission 
     with average annual purchases not exceeding $250,000 are 
     exempt from the trust provisions.
        The section also states the trust will not include 
     livestock sold to bona fide third-party purchasers. (Section 
     541)
        The House bill contains no comparable provision.
        The Conference substitute adopts the Senate provision with 
     an amendment striking the Senate provision and adding an 
     amendment directing the Secretary of Agriculture to consider 
     enhancing passenger movement and commerce on and between 
     islands when imposing a quarantine on a state entirely 
     comprised of islands; extending cotton classification 
     services; and amending the Plant Variety Protection Act to 
     allow varieties of potatoes that have been marketed for more 
     than four years in another country to apply for and receive 
     protection in the U.S. during a one-year period after 
     enactment. Protection would be limited to a total of 20 
     years, including the time protected in another country. 
     (Sections 911, 912, and 913)
        The Managers are concerned about the burden borne by the 
     State of Hawaii as a result of the agriculture quarantine 
     covering that entire state for the benefit of agricultural 
     production within the mainland United States. The Managers 
     expect that the Agriculture Committees will give further 
     consideration to this matter and that the Department of 
     Agriculture will do the same. The Managers fully expect that 
     the provisions in this bill relating to the agricultural 
     quarantine inspection user fees will help address 
     international, as well as domestic preclearance, staffing and 
     equipment needs in Hawaii.
     (2) Swine health protection, Mount Pleasant National Scenic 
         Area, and pseudorabies eradication program
        The Senate amendment authorizes the Secretary, upon 
     request of the Governor or other appropriate official of a 
     State, to terminate the State's primary enforcement 
     responsibility under the Swine Health Protection Act. This 
     section also deletes the requirement that an advisory 
     committee be appointed to evaluate state programs regulating 
     the treatment of garbage to be fed to swine. (Section 544)
        The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment regarding the designation of the Mount Pleasant 
     National Scenic Area and extending the Pseudorabies 
     eradication program through 2002. (Section 914, 915, and 916)
     (3) Agricultural quarantine and inspection and meat and 
         poultry inspection
        The House bill amends the agricultural quarantine and 
     inspection fees provisions in section 2509 of the Food, 
     Agriculture, Conservation and Trade Act of 1990 to provide 
     that, for the fiscal years 1996-2002, funds in the user fee 
     account in excess of appropriated amounts shall be available 
     until expended. Beginning with fiscal year 2003, funds in the 
     user fee account shall be available without fiscal year 
     limitation. This section also provides an exemption from the 
     limitation on total number of full-time equivalent positions 
     for positions attributable to the provision of agricultural 
     quarantine and inspection services. (Section 502)
       The Senate amendment contains an identical provision. 
     (Section 504)
       The Conference substitute adopts the House provision with 
     an amendment requiring the Secretary to report to Congress 
     within 90 days indicating the steps necessary to allow 
     interstate shipment of state-inspected meat and poultry and 
     requiring the establishment of a Safe Meat and Poultry 
     Inspection Panel. (Section 917 and 918)
       The Managers are concerned that because of escalating 
     budget pressures and consistent annual increases in passenger 
     and commercial air travel, the Agriculture Quarantine 
     Inspection (AQI) services are negatively impacted. The 
     Managers have thus provided that the amount necessary from 
     the appropriations process will be frozen at $100 million 
     between fiscal years 1996 and 2002. Furthermore, the Managers 
     have provided the funding necessary to make all funds 
     collected by APHIS in excess of $100 million available to the 
     Secretary for the purpose of AQI without further 
     appropriation. As provided in this legislation, the Managers 
     expect that the Agriculture Quarantine Inspection user fee 
     fund be no longer subject to appropriation starting in fiscal 
     year 2003. The Managers further expect that all funds 
     collected after fiscal year 2002 be deposited in a dedicated 
     account at the U.S. Treasury for the express purpose of 
     covering the costs of Agriculture Quarantine Inspection. The 
     managers expect the Secretary to have sole discretion over 
     the disbursement and use of these funds for the purpose of 
     AQI.
       The Managers have observed that virtually every debate 
     regarding the current operation and future modernization of 
     the federal meat and poultry inspection system concludes with 
     a call for an increase in the role of sound science in the 
     decision-making process. For this reason, the Managers have 
     mandated the creation of the Safe Meat and Poultry Inspection 
     Panel. The panel shall consist of experts in medical science 
     demonstrating knowledge in areas of microbiology, 
     epidemiology, and veterinary medicine, and scientific experts 
     with knowledge in animal sciences, poultry science, meat 
     science, and food technology.
       It is the intent of the Managers that the Secretary act 
     swiftly to appoint members of the panel so that it may begin 
     offering its valuable input at the earliest possible 
     opportunity. The Managers expect that this panel will address 
     matters within its scope that are significant in the 
     development of food safety policy. Also, it is the intent of 
     the Managers that the panel be operated in a thrifty manner.
       The urgency of implementing this provision is reflected in 
     the simple design of this panel. This independent panel of 
     scientists is expected to operate unencumbered by the 
     traditional political and bureaucratic structure of the U.S. 
     Department of Agriculture to advise the Secretary on all 
     manners of inspection policy proposals. It is the intent of 
     the Managers that the panel will not be limited to 
     initiatives within the Department but will consider both its 
     own ideas and those from the scientific community at large.
       Further, it is the intent of the Managers that no funds for 
     the purpose of in plant inspections be used for the Safe Meat 
     and Poultry Inspection Panel. The Managers advise the 
     Secretary to examine the Food Safety Inspection Service 
     funding currently used for non-inspection related travel, 
     funding that is transferred outside of the agency and the 
     resources devoted to the Administrator's staff, which has 
     expanded significantly in recent years.
       The United States presently allows foreign-inspected meat 
     and poultry products to engage in interstate commerce as long 
     as the foreign system has been certified by the United States 
     Department of Agriculture as ``equivalent'' to the U.S. 
     system. At the same time, meat and poultry products from 
     state inspection systems which are required to be ``at least 
     equal'' to the federal inspection system are prohibited in 
     statute from engaging in interstate commerce. It is the 
     intent of the Managers to seek a resolution to the apparent 
     inequities in this current regulatory situation.
       Since the President included the interstate shipment of 
     state inspected product in the Guidance of the Administration 
     for the 1995 Farm Bill, the Managers expect that the 
     Secretary will report on the reasons for the evolution of 
     differences between state and federal inspection programs, 
     and any and all legal prohibitions to interstate shipment of 
     state inspected product. Moreover, the Managers expect the 
     report to expand beyond the legal history and an explanation 
     of prohibitions to interstate shipment and sale of state 
     inspected product, but engage constructively by making 
     recommendations on challenges, such as, appropriate food 
     safety, administrative, and funding, that may be necessary to 
     effect an efficient transition.
     (4) Reimbursable agreements
       The Senate amendment authorizes the Secretary to enter into 
     reimbursable fee agreements for the pre-clearance at 
     locations outside the U.S. of plants, plant products, animals 
     and articles for movement into the U.S. Funds collected for 
     pre-clearance shall be credited to accounts established by 
     the Secretary and shall remain available until expended for 
     pre-clearance activities. This section authorizes the 
     Secretary to require persons for whom the services are 
     performed to reimburse the Secretary for the services. 
     (Section 543)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 919)
     (5) Overseas tort claims
       The Senate amendment authorizes the Secretary to pay tort 
     claims when claims arise outside the U.S. for persons who are 
     performing services for the Secretary. A claim must be 
     presented to the Secretary within two years after the claim 
     accrues. (Section 547)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 920)
     (6) Graduate School of the U.S. Department of Agriculture
       The Senate amendment states the purpose of this section is 
     to authorize continued operation of the Graduate School as a 
     non-appropriated fund instrumentality of the Department.
       Subsection (b) defines board, department, director, 
     graduate school, and secretary.
       Subsection (c) sets forth the functions and authority of 
     the Graduate School. The Graduate School is authorized to 
     develop and administer education, training and professional 
     development activities. The Graduate

[[Page H2841]]

     School may provide educational activities to federal 
     agencies, employees, nonprofit organizations, other entities, 
     and members of the public. The Graduate School may charge 
     reasonable fees for its activities based upon the cost of 
     providing the service and may retain those fees rather than 
     depositing them in the United States Treasury. The Graduate 
     School is authorized to operate under its current name or may 
     adopt another name.
       Subsection (d) provides that the General Administration 
     Board appointed by the Secretary would govern the activities 
     of the Graduate School in accordance with the Secretary's 
     regulations. The Board would be responsible for determining 
     the policies by which the School is administered and for 
     taking steps necessary to assure that the responsibilities 
     are carried out, including the selection of a Director and 
     other officers. The Board may authorize the Director to 
     borrow money on the credit of the Graduate School.
       Subsection (e) authorizes the Director to carry out the 
     activities of the School, subject to the direction and 
     oversight of the Board. The Board may authorize the Director 
     to invest funds held in excess of the current operating 
     requirements as a reasonable reserve.
       Subsection (f) states that the director and Board members 
     shall not be held personally liable for any loss or damage 
     that may accrue to the funds of the Graduate School as a 
     result of a discretionary act in carrying out their duties.
       Subsection (g) states that Graduate School employees shall 
     not be considered federal employees.
       Subsection (h) states that the Graduate School shall not be 
     considered a federal agency for purposes of the Federal Tort 
     Claims Act, the Federal Advisory Committee Act, the Freedom 
     of Information Act or the Privacy Act.
       Subsection (i) prohibits the Graduate School from accepting 
     gifts from interested parties.
       Subsection (j) authorizes the Graduate School to accept 
     gifts of money and property made for the benefit of the 
     Graduate School. This subsection authorizes the Graduate 
     School to acquire, maintain, and control real property. It 
     also authorizes the Graduate School to enter into contracts 
     without regard to any law prescribing procedures for the 
     procurement of property or services and to dispose of real or 
     personal property without regard to the Federal Property and 
     Administrative Services Act. The subsection also authorizes 
     the Graduate School to continue to use the facilities and 
     resources of the Department in carrying out its functions if 
     the costs are reimbursed out of the fees collected or other 
     income earned by the Graduate School. (Section 548)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 921)
     (7) Student internship program and conveyance of excess 
         Federal personal property
       The Senate amendment authorizes use of appropriated or user 
     fee funds to pay for transportation, subsistence, and lodging 
     expenses of student interns. Student interns are defined as 
     employees who assist scientific, professional, 
     administrative, or technical employees of the Department and 
     who are bona fide students of accredited colleges or 
     universities pursuing courses related to the field in which 
     the person is employed by the Department. (Section 549)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to authorize the Secretary to enter into 
     cooperative agreements on an annual basis with one or more 
     associations of colleges and universities for the purpose of 
     providing for USDA participation in internship programs for 
     graduate and undergraduate students who are selected by such 
     associations from students attending member institutions of 
     such associations and other colleges and universities and an 
     amendment authorizing the Secretary of Agriculture to convey 
     title to excess personal property to any 1994 Institution, 
     Hispanic-Serving Institution or 1890 institutions for 
     research purposes with or without monetary compensation. 
     (Section 922 and 923)
     (8) Conveyance of land, sale of land, designation of research 
         center, and Washington area strategic space plan
       The Senate amendment provides for conveyance of land to the 
     Board of Trustees of the University of Arkansas to be used in 
     the White Oak Cemetery. The land would revert to the United 
     States if not used in the cemetery. (Section 550)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment authorizing the sale of land known as the 
     ``Walker Tract''; renaming the Agricultural Research Service 
     Small Farms research facility located near Booneville, 
     Arkansas as the Dale Bumpers Small Farms Research Center; and 
     authorizing funding for improvement of roads at Beltsville as 
     part of the USDA Washington Area Strategic Space Plan. 
     (Sections 924, 925, 926 and 927)
       The Managers expect USDA to continue to evaluate the 
     Washington Area Strategic Plan in light of Department 
     streamlining and workforce reduction. Furthermore, the 
     Managers expect the Secretary to work closely with the House 
     and Senate Agriculture Committees in identifying the most 
     cost-effective option for renovating the South Building. It 
     is important that USDA brief the Agriculture Committees on a 
     regular basis about progress in this regard.
     (9) Sense of the Congress regarding purchase of American-made 
         equipment and products
       The House bill states that it is the intent of Congress 
     that recipients of assistance under this Act shall purchase 
     only American-made equipment and products. (Section 508)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the Senate provision, 
     striking the House provision.
     (10) Amendment of the Virus-Serum Toxin Act of 1913
       The Senate amendment amends the Virus Serum Toxin Act of 
     1913 to increase the criminal penalty from a maximum of 
     $1,000 to a maximum of $10,000, upon conviction, for each 
     violation. This section also authorizes the assessment of 
     civil penalties of up to $5,000 for each violation of the Act 
     or regulations. A person must ``knowingly'' violate the Act 
     or regulations to be subject to a criminal or civil penalty. 
     Knowingly forging, counterfeiting, or without permission of 
     the Secretary of Agriculture, using, altering, defacing, or 
     destroying any certificate, permit, license, or other 
     document will be considered a violation of the Act. The 
     Secretary is required to provide notice and an opportunity 
     for an agency hearing before issuing an order for a civil 
     penalty. The total amount of civil penalties assessed against 
     a violator shall not exceed $300,000 for all such violations 
     adjudicated in a single proceeding. In the course of an 
     investigation of a suspected violation, the Secretary may 
     issue subpoenas requiring the attendance and testimony of 
     witnesses and the production of evidence that relates to the 
     matter under investigation. (Section 546)
       The House bill contains no comparable provision.
       The Conference substitute adopts the House provision, 
     striking the Senate provision.
     (11) Equine piroplasmosis
       It is the intention of the Congress that the Secretary of 
     Agriculture be directed to protect the United States and its 
     domestic horse population from equine piroplasmosis by taking 
     all actions necessary to ensure that the disease does not 
     become established in the United States or spread to the 
     domestic horse population.
       Congress finds that the U.S. Department of Agriculture and 
     the Georgia Department of Agriculture plan to grant a 
     conditional waiver from Federal and State health requirements 
     for a limited number of foreign horses testing positive for 
     equine piroplasmosis to enter the U.S. and compete in the 
     1996 Centennial Olympic Games.
       Although careful conditions have been imposed on such 
     admissions, there is a minimum risk that this disease could 
     become established in the U.S. Therefore, the twenty point 
     plan that has been agreed to by the European Union, the 
     Georgia Department of Agriculture, and the U.S. Department of 
     Agriculture must not be relaxed and the conditions must be 
     followed and administratively enforced.
     Pat Roberts,
     Bill Emerson,
     Steve Gunderson,
     Thomas W. Ewing,
     Bill Barrett,
     Wayne Allard,
     John Boehner,
     Richard Pombo,
     E de la Garza,
     Charlie Rose,
     Charlie Stenholm,
     Gary Condit,
                                Managers on the Part of the House.

     Richard G. Lugar,
     Bob Dole,
     Jesse Helms,
     Thad Cochran,
     Mitch McConnell,
     Larry E. Craig,
     Patrick Leahy,
     Howell Heflin,
     Managers on the Part of the Senate.

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