[Congressional Record Volume 146, Number 33 (Wednesday, March 22, 2000)]
[Senate]
[Pages S1571-S1582]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




            RISK MANAGEMENT FOR THE 21ST CENTURY--Continued

  Mr. KENNEDY. Mr. President, I support this legislation. The crop 
insurance bill before us today provides $1.5 billion over each of the 
next 4 years to support the Nation's farmers, and they clearly deserve 
this assistance. Hard-working farmers across the Nation deserve to live 
with dignity. Federal assistance is justified to protect them when the 
harsh weather destroys their crops or volatile markets undervalue their 
produce.
  I hope in the coming weeks the Senate will also have an opportunity 
to address a related urgent need. I am talking about hunger and the 
inadequacy of the current Food Stamp Program. The problem is that the 
program's reach in curbing hunger among working families has weakened 
over time. It is unacceptable for children and working families to go 
hungry in America today. The latest research is clear, and it calls for 
our urgent action.
  The General Accounting Office reports that ``children's participation 
in the Food Stamp Program has dropped more sharply than the number of 
children living in poverty, indicating a growing gap between need and 
assistance.''
  Census and state food stamp data show that between 1995 and 1998, 
while the number of poor people fell by almost 2 million, the number of 
food stamp beneficiaries fell by over 7 million, leaving millions more 
poor people without food stamps.
  The Department of Agriculture reports that 10.5 million U.S. 
households experienced some degree of food insecurity in 1998, and 1 or 
more people went hungry in 3.7 million of these households.
  The Tufts University Center on Hunger and Poverty in Massachusetts 
reports that a third of children living in immigrant households with 
food stamp cuts were experiencing moderate to severe hunger.
  With Project Bread in Massachusetts, the Center on Hunger and Poverty 
also coauthored an extraordinary study of Child Hunger in Massachusetts 
about a year ago. It was cosponsored by Ralph Martin, who was a 
Republican district attorney in Suffolk County, and Congressman Joseph 
Kennedy. They did extensive studies in Massachusetts in a wide variety 
of communities--some of our older cities, some of our more prosperous 
cities with pockets of extraordinary poverty, and then in a number of 
the rural areas. It is an absolutely superb report. Rather than putting 
the whole report in the Record, I will raise it throughout the 
discussions of hunger to come. Dr. Larry Brown directs the Center on 
Hunger and Poverty, and as I think most of us who have worked on the 
hunger issue over the years know, he has had an extraordinary career, 
been an invaluable resource for this Nation in terms of finding hunger 
and being constructive and positive in helping us deal with that issue 
in a constructive way.
  One in five American children is poor in today's America. The Center 
on Budget and Policy Priorities reports that while the total number of 
children who are poor has declined, the intensity of poverty among 
those children who are left behind has increased, and one of the 
reasons poor children are poorer is that their access to food stamps is 
diminishing.
  The U.S. Conference of Mayors reports that demand for emergency food 
assistance increased 18 percent during 1999. This is the largest 
increase since 1992. Limited resources meant that 21 percent of 
requests for food were unmet. In addition, 67 percent of the adults 
requesting emergency food assistance in the Nation's cities were 
employed.
  Especially in this time of recent economic prosperity and record 
budget surpluses, we must do more to protect working families across 
the Nation who need food. America's farmers have a long and proud 
tradition of service to the Nation, and their hard work produces an 
abundance of foodstuffs. Surely we can ensure that this abundance is 
used in a way that no one in America goes hungry.
  I know the issue of hunger is of deep concern to the chairman and the 
ranking member of the Agriculture Committee, who oversee the Nation's 
antihunger efforts. For $500 million a year, we could provide modest 
hunger relief for low-income families. These additional resources 
should be allocated to the Food Stamp Program, as bipartisan coalitions 
in both the House and the Senate have proposed in the Hunger Relief Act 
that many of us support.
  Our proposal makes four long overdue improvements in the Food Stamp 
Program. It authorizes States to use their own TANF rules to determine 
which vehicles families may own to get to work themselves and safely 
transport their children to school--enormously important, a very modest 
recommendation, but very important.
  Second, for families forced to spend over 50 percent of income on 
shelter, it increases the present shelter deduction and indexes it to 
inflation--incredibly important. The cost of housing, particularly in 
the older communities, has gone right up through the roof and because 
the shelter deduction is capped, families who must pay high shelter 
costs are helped less and less by the Food Stamp Program. This is a 
very modest recommendation to increase the cap and index it to 
inflation.
  Third, the bill restores eligibility to vulnerable legal immigrants. 
We all know the history in terms of the moving of immigrants off the 
Food Stamp Program as part of welfare reform. I never believed it made 
a great deal of sense at that time, nor do I think it still makes a 
great deal of sense. We have been trying to work for restoration of 
food stamp benefits to legal immigrants since they were imposed.

  Legal immigrants are going to be American citizens. They are people 
who have abided by the rules in order to come here. The reason they 
have immigrated is primarily because they have members of their 
families who are here. That is the overwhelming reason for it. So they 
are going to be American citizens. To deprive people, particularly 
children--although we made limited progress in that in recent years--
who are otherwise going to be American citizens never seemed, to me, to 
be a wise policy. We seek appropriate restoration in this legislation.
  It also increases Federal support for emergency food pantries and 
soup kitchens. I think the excellent research from the Conference of 
Mayors is a powerful justification for those modest recommendations.
  The Congressional Budget Office estimates together these steps will 
cost about $2.5 billion over 5 years, benefiting over a million 
children and working adults. Nearly 1,200 national, State, and local 
organizations, representing concerned citizens in all 50 States, have 
urged Congress to pass the legislation.
  I hope we can enact this important hunger relief measure this year. 
Families living in hunger across the country need and deserve our help. 
I am hopeful

[[Page S1572]]

that the Budget Committee will create a reserve fund dedicated to 
hunger relief. Next, I hope that the Agriculture Committee will apply 
its expertise to the work we have begun and report this legislation.
  Again, I thank Senator Lugar, who has been a leader in the 
Agriculture Committee, and has also been a leader on this concern, as 
well as working with us on this issue historically, and our good 
friend, Senator Harkin from Iowa. Senator Specter has been a leader, as 
well. I thank Senator Leahy and Senator Jeffords and Senator Daschle, 
all who are strong supporters. We have a number of our colleagues who 
are cosponsors. But all of them have had long careers on the issue of 
hunger in America. We are grateful for their continued interest and 
support.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Voinovich). The Senator from Indiana.
  Mr. LUGAR. Mr. President, let me simply respond quickly to the very 
specific points the distinguished Senator has made. Hunger relief 
continues to be a top priority for the Agriculture Committee. That will 
always be the case.
  One priority should be that States should have the flexibility they 
need to determine how vehicles are counted under the Food Stamp Program 
since States know best about the transportation needs of the families. 
The Senator has mentioned that is one of the points he has. We strongly 
commend that idea. We look forward to working with the Senator and with 
others.
  I wish to take advantage of this opportunity simply to say that in my 
own State of Indiana I have been visiting food banks, four very 
substantial efforts in Indianapolis, Fort Wayne, Evansville, and in 
Lewisville, serving nine Indiana counties.
  The reason for my doing that is that the demands for food from these 
food banks and from the food pantries that they serve have increased 
very substantially during the last year. This is counterintuitive to 
many Americans, but not to the Senator from Massachusetts who has 
highlighted that in his remarks today.
  In part, it comes because of a transition from welfare to work. A 
number of individual Americans--and a 7-State survey pointed out--these 
individuals have, in fact, accepted jobs. A majority of those who were 
on welfare rolls in Indiana have moved into jobs. But for most of these 
people, the incomes, on an annual basis, are somewhere in the 
neighborhood of $10,000 to $15,000.
  Many have substantial families. They have moved from welfare but not 
out of poverty. The survey found that 50 percent of these families had 
extended families. They went, as we would, to their kinfolk. They were 
able to gain food during desperate periods. The other half essentially 
went to food banks; thus the increased demand.
  I have offered a modest piece of legislation, which the Finance 
Committee is now considering--I hope they will consider it carefully--
that further codifies the tax exemption given to companies that already 
are given an exemption for food contributed to food banks but extends 
that to partnerships or proprietorships, to individual entrepreneurs, 
restaurants and others, as well as to farmers and ranchers, many of 
whom make these generous contributions now. It is in recognition of a 
very substantial need. There has been great support, at least in my 
State, for meeting the needs of those who have them.
  Clearly, reforms of the Food Stamp Program are very important in the 
same regard and for the same reason--the many Americans who face 
problems of hunger. The Senator is certainly correct; the distribution 
problem, the equity problems, are profound. But those are ones we must 
deal with, and I thank the Senator for taking the floor today for this 
important colloquy.
  The PRESIDING OFFICER. The Senator from Massachusetts.
  Mr. KENNEDY. Mr. President, I thank the Senator for his comments and 
for his energy in visiting these distribution centers himself.
  I will put in the Record some of the findings in a number of the 
distribution places in Massachusetts, with the increasing escalation of 
families who are receiving the benefits of these foods and increasing 
numbers of children, and that the total ages have gone down extensively 
as well. It is a very powerful and moving commentary about what is 
happening.
  I agree with the Senator, at a time when we all remind ourselves 
every day about how strong this economy is and the significant economic 
progress we have made, all of that is very true, but there are a number 
of people in our country who are facing significant deprivation in the 
area of food. We want to see what can be done to try to provide some 
relief. We will work closely with the committee and with the chairman. 
I am grateful to him.
  Mr. LUGAR. I fully agree with my friend from Massachusetts that 
hunger relief needs to be a top priority for the Agriculture Committee, 
and resources should be found to address the problem. I am especially 
concerned that states have the flexibility they need to determine how 
vehicles are counted under the Food Stamp Program, since states know 
best what transportation families need to work and to safely transport 
their children.
  Mr. HARKIN. I look forward to working with my good friend from 
Indiana and Massachusetts to pass strong hunger relief legislation this 
year. In my work on the Agriculture Committee, the Agriculture 
Appropriations Subcommittee, and the Labor, HHS, and Education 
Appropriations Subcommittee, I have been dismayed not only to see the 
reports of increasing hunger among children and working families that 
Senator Kennedy describes, but also to hear scientists explain how 
inadequate nutrition limits children's ability to learn at school and 
adults' ability to concentrate at work. I join my colleagues in urging 
the Budget Committee to report a resolution that includes a reserve 
fund of $2.5 billion over five years to alleviate hunger in America.
  Mr. SPECTER. I decided to join my friend from Massachusetts in 
introducing the Hunger Relief Act after carefully reviewing the 
evidence of persisting hunger in Pennsylvania and the U.S., and after 
extensive consultations with local leaders who are working under 
enormous strains to meet growing needs. As chairman of the 
appropriations subcommittee that covers education and labor programs, I 
share the concern expressed by my friend from Iowa that our education, 
health, and workforce improvement efforts are threatened by unmet needs 
for nutritional assistance. I too hope that the Budget Committee 
responds to the needs that our hunger relief legislation addresses, by 
including a reserve fund of $2.5 billion over five years.
  Mr. KENNEDY. My good friend from Pennsylvania makes an excellent 
point about investigating hunger in his state. He has shown impressive 
leadership throughout our deliberations on hunger during this Congress, 
and helped hone our proposal to target the most urgent needs. From my 
many discussions with Senator Specter, I know that he has carefully 
investigated the hardships faced by his constituents in Pennsylvania. I 
urge every Senator in this Chamber to follow his example. In 
Massachusetts:
  An eleven-year-old child in Brighton reported to investigators last 
year that ``Sometimes I'm really hungry. Sometimes I have nothing to 
eat but Cheerios and milk. . . . I wake up and I can't go back to sleep 
because I have stomach pain. Then I wake up in the morning and I feel 
sick. I wish that every time we need food, we just had it in the 
fridge.''
  A mother in Springfield worried, ``Should my kids sit in the dark or 
should they go hungry? One of my kids has multiple handicaps, so I have 
to pay the utility bills to have heat and light. But, then we have no 
food.''
  A 12-year-old youngster in Dorchester reports, ``When I'm hungry I 
feel like I'm dying. I eat ice because it fills me up with water. . . . 
When I don't eat, in school I get sleepy and bored.''
  When I looked at studies conducted throughout the Commonwealth of 
Massachusetts, I found that 35 percent of Massachusetts food bank and 
soup kitchen clients are under 18 years old. Moreover, 63 percent of 
Massachusetts community food providers have reported an increase in 
demand for food aid in the last year, with 49 percent of programs 
noting an increase in demand among families with children. This 
evidence of ongoing urgent needs is inconsistent with the fact that 
118,000 people

[[Page S1573]]

in Massachusetts left food stamp roles in the three years preceding 
September 1998 even though during this time the number of people living 
in poverty increased by 50,000. I think that if any Senator conducts a 
similar review of the data, unfortunately a similar picture will 
emerge.
  Mr. LEAHY. The needs described so well by my colleagues are 
pervasive, urgent, and fully within our means to address. Hunger has a 
cure. As ranking member of the Agriculture Subcommittee on Research, 
Nutrition, and General Legislation, I will do all I can to pass the 
Hunger Relief Act this year. I respectfully and insistently ask the 
Budget Committee to cooperate in creating a $2.5 billion reserve for 
this purpose.
  Mr. JEFFORDS. Hunger in this time of prosperity should not be 
tolerated by people of any party affiliation. The American people 
overwhelmingly support hunger relief efforts, and many of them 
volunteer their time and resources to help in their communities. I'm 
encouraged that the groundwork for modest hunger relief has been laid 
entirely in a bipartisan spirit, and should continue this way through 
passage of legislation that the experts on the Agriculture Committee 
have perfected. I join my colleagues from both sides of the aisle in 
inviting the Budget Committee to preserve this spirit as it reserves 
$2.5 billion over five years for hunger relief legislation. This will 
produce a significant bipartisan, moderate accomplishment this session 
for people in obvious need.
  Mr. DASCHLE. In this time of instant millionaires, it's easy to close 
our eyes to the fact that people, particularly children, go hungry in 
this country. But hunger is a fact and it's a national tragedy. It's 
particularly troubling that many working families find themselves short 
of food.
  When Congress enacted welfare reform in 1996, we worked to ensure 
that families would have the support they need to get off welfare. Food 
stamps are a critical part of that support. Yet food stamp enrollment 
has declined more rapidly than the poverty data would suggest is 
warranted.
  The policies we are talking about today are urgently needed to reduce 
hunger in this country, particularly in working families that need 
extra help as they work to become self-sufficient.
  I commend the Senators who have spoken today for their efforts to 
address the serious problem of hunger in America. A number of us met 
recently with Secretary Glickman to discuss this issue. I look forward 
to working with them to enact hunger relief legislation this year and 
urge the Budget Committee to reserve $2.5 billion for this effort.
  The PRESIDING OFFICER. The Senator from Indiana.
  Mr. LUGAR. Mr. President, I thank the distinguished Senator from 
Massachusetts for that colloquy.
  In completing at least the unanimous consent list of amendments, the 
distinguished Senator from Wisconsin, Mr. Kohl, has offered an 
amendment which is in the form of language he has presented to me. I 
ask unanimous consent that the Kohl amendment be made a part of the 
managers' amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LUGAR. I further ask unanimous consent that Senator Grams of 
Minnesota be added as a cosponsor to the Kohl amendment which is now 
part of the managers' amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Managers' amendment (No. 2887), as modified, is as follows:

       On page 2, strike the table of contents and insert the 
     following:

Sec. 1. Short title; table of contents.

                    TITLE I--CROP INSURANCE COVERAGE

Sec. 101. Quality adjustment.
Sec. 102. Prevented planting.
Sec. 103. Payment of portion of premium by Corporation.
Sec. 104. Assigned yields.
Sec. 105. Multiyear disaster actual production history adjustment.
Sec. 106. Noninsured crop disaster assistance program.
Sec. 107. Crop insurance coverage for rice.

                 TITLE II--RESEARCH AND PILOT PROGRAMS

Sec. 201. Research and pilot programs.
Sec. 202. Research and development contracting authority.
Sec. 203. Choice of risk management options.
Sec. 204. Risk management innovation and competition pilot program.
Sec. 205. Education and research.
Sec. 206. Conforming amendments.

                       TITLE III--ADMINISTRATION

Sec. 301. Board of Directors of Corporation.
Sec. 302. Good farming practices.
Sec. 303. Sanctions for program noncompliance and fraud.
Sec. 304. Oversight of agents and loss adjusters.
Sec. 305. Adequate coverage for States.
Sec. 306. Records and reporting.
Sec. 307. Fees for plans of insurance.
Sec. 308. Limitation on double insurance.
Sec. 309. Specialty crops.
Sec. 310. Federal Crop Insurance Improvement Commission.
Sec. 311. Highly erodible land and wetland conservation.
Sec. 312. Projected loss ratio.
Sec. 313. Compliance with State licensing requirements.

                   TITLE IV--MISCELLANEOUS PROVISIONS

Sec. 401. Improved risk management education.
Sec. 402. Sense of the Senate regarding the Federal crop insurance 
              program.

           TITLE V--EFFECTIVE DATES; TERMINATION OF AUTHORITY

Sec. 501. Effective dates.
Sec. 502. Termination of authority.
       On page 7, strike lines 13 through 15 and insert the 
     following:
       ``(F) Crop years.--This paragraph shall apply to each of 
     the 2001 through 2004 crop years.''.
       On page 10, line 2, strike ``or greater than 75 percent'' 
     and insert ``75, 80, or 85 percent''.
       On page 13, line 5, strike ``or greater than''.
       On page 13, strike lines 20 through 22 and insert the 
     following:
       ``(F) In the case of additional coverage equal to 80 
     percent of the recorded or appraised average yield 
     indemnified at 100 percent of the expected market price, or a 
     comparable coverage for a plan of insurance that is not based 
     on yield, the amount shall be equal to the sum of--
       ``(i) 38 percent of the amount of the premium established 
     for coverage at 80 percent of the recorded or appraised 
     average yield indemnified at 100 percent of the expected 
     market price under subsection (d)(2)(D)(i); and
       ``(ii) the amount of operating and administrative expenses 
     determined under subsection (d)(2)(D)(ii).
       ``(G) In the case of additional coverage equal to 85 
     percent of the recorded or appraised average yield 
     indemnified at 100 percent of the expected market price, or a 
     comparable coverage for a plan of insurance that is not based 
     on yield, the amount shall be equal to the sum of--
       ``(i) 28 percent of the amount of the premium established 
     for coverage at 85 percent of the recorded or appraised 
     average yield indemnified at 100 percent of the expected 
     market price under subsection (d)(2)(D)(i); and
       ``(ii) the amount of operating and administrative expenses 
     determined under subsection (d)(2)(D)(ii).
       ``(H) Subparagraphs (A) through (G) shall apply to each of 
     fiscal years 2001 through 2004.''.
       On page 23, after line 25, add the following:

     SEC. 107. CROP INSURANCE COVERAGE FOR RICE.

       Section 508(a) of the Federal Crop Insurance Act (7 U.S.C. 
     1508(a)) (as amended by section 102(a)) is amended by adding 
     at the end the following:
       ``(8) Special provisions for rice.--Notwithstanding any 
     other provision of this title, beginning with the 2001 crop 
     of rice, the Corporation shall offer plans of insurance, 
     including prevented planting coverage and replanting 
     coverage, under this title that cover losses of rice 
     resulting from failure of irrigation water supplies due to 
     drought and saltwater intrusion.''.
       On page 25, line 13, strike ``and''.
       On page 25, line 15 after ``livestock'' insert ``and 
     livestock products''.
       On page 25, line 15, strike the period at the end and 
     insert a semicolon.
       On page 25, between lines 15 and 16, insert the following:
       ``(H) subject to paragraph (7), after October 1, 2000, 
     salmon; and
       ``(I) subject to paragraph (7), after October 1, 2000, loss 
     of or damage to trees or fruit affected by plum pox virus 
     (commonly known as `sharka'), including quarantined trees or 
     fruit.
       On page 27, line 2, strike ``$20,000,000'' and insert 
     ``$10,000,000''.
       On page 27, line 4, strike ``$40,000,000'' and insert 
     ``$30,000,000''.
       On page 27, line 6, strike ``$60,000,000'' and insert 
     ``$50,000,000''.
       On page 27, line 8, strike ``$80,000,000'' and insert 
     ``$60,000,000''.
       On page 27, line 10, insert ``(3)(H),'' after ``(3)(G),''.
       On page 32, line 17, strike ``and''.
       On page 32, line 20, strike the period and insert ``; 
     and''.
       On page 32, between lines 20 and 21, insert the following:
       ``(IV) results in not less than 15 percent of payments 
     being made to producers in States in which--
       ``(i) there is traditionally, and continues to be, a low 
     level of federal crop insurance participation and 
     availability; and
       ``(ii) the Secretary of Agriculture determines that the 
     stateis underserved by federal crop insurance.''.
       On page 41, line 17, strike ``516(b)(2)(C)'' and insert 
     ``516(a)(2)(C)''.
       On page 44, strike line 19 and insert the following:

[[Page S1574]]

     period at the end and inserting ``; and''; and
       On page 45, strike line 2 and insert the following:
     fiscal year.''.
       On page 45, strike line 3 and insert the following:

     SEC. 204. RISK MANAGEMENT INNOVATION AND COMPETITION PILOT 
                   PROGRAM.

       Section 522 of the Federal Crop Insurance Act (as amended 
     by section 203(a)) is amended by adding at the end the 
     following:
       ``(d) Risk Management Innovation and Competition.--
       ``(1) Purpose.--The purpose of the pilot program 
     established under this subsection is to determine what 
     incentives are necessary to encourage approved insurance 
     providers to--
       ``(A) develop and offer innovative risk management products 
     to producers;
       ``(B) rate premiums for risk management products; and
       ``(C) competitively market the risk management products.
       ``(2) Establishment.--
       ``(A) In general.--The Corporation shall establish a pilot 
     program under which approved insurance providers may propose 
     for approval by the Board risk management products 
     involving--
       ``(i) loss of yield or revenue insurance coverage for 1 or 
     more commodities (including commodities that are not 
     insurable under this title as of the date of enactment of 
     this section, but excluding livestock);
       ``(ii) rates of premium for the risk management product; or
       ``(iii) underwriting systems for the risk management 
     product.
       ``(B) Submission to board.--The Board shall review and 
     approve a risk management product before the risk management 
     product may be marketed under this subsection.
       ``(C) Determination by board.--The Board may approve a risk 
     management product for subsidy and reinsurance under this 
     title if the Board determines that--
       ``(i) the interests of producers of commodities are 
     adequately protected by the risk management product;
       ``(ii) premium rates charged to producers are actuarially 
     appropriate (within the meaning of section 508(h)(3)(E));
       ``(iii) the underwriting system of the risk management 
     product is appropriate and adequate;
       ``(iv) the proposed risk management product is reinsured 
     under this title, is reinsured through private reinsurance, 
     or is self-insured;
       ``(v) the size of the proposed pilot area is adequate;
       ``(vi) insurance protection against the risk covered by the 
     proposed risk management product is not generally available 
     from private plans of insurance that are not covered by this 
     title; and
       ``(vii) such other requirements of this title as the Board 
     determines should apply to the risk management product are 
     met.
       ``(D) Confidentiality.--
       ``(i) In general.--All information concerning a risk 
     management product shall be considered to be confidential 
     commercial or financial information for the purposes of 
     section 552(b)(4) of title 5, United States Code.
       ``(ii) Standard.--If information concerning a risk 
     management product of an approved insurance provider could be 
     withheld by the Secretary under the standard for privileged 
     or confidential information pertaining to trade secrets and 
     commercial or financial information under section 552(b)(4) 
     of title 5, United States Code, the information shall not be 
     released to the public.
       ``(3) Marketing of risk management products.--
       ``(A) Definition of original provider.--In this paragraph, 
     the term `original provider' means an approved insurance 
     provider that submits a risk management product to the Board 
     for approval under paragraph (2).
       ``(B) Authority to market.--If the Board approves a risk 
     management product under paragraph (2), subject to 
     subparagraph (C), only the original provider may market the 
     risk management product.
       ``(C) Fee.--
       ``(i) In general.--An approved insurance provider (other 
     than the original provider) that desires to market a risk 
     management product shall pay a fee to the original provider 
     for the right to market the risk management product.
       ``(ii) Amount.--The original provider shall determine the 
     amount of the fee under clause (i).''.

     SEC. 205. EDUCATION AND RESEARCH.

       Section 522 of the Federal Crop Insurance Act (as amended 
     by section 204) is amended by adding at the end the 
     following:
       ``(e) Education and Research.--
       ``(1) In general.--The Corporation shall establish the 
     programs described in paragraphs (2) and (3), respectively, 
     for the 2001-2004 fiscal years, not to exceed the funding 
     limitations established in paragraph (4).
       ``(2) Education and information.--The Corporation shall 
     establish a program of education and information for States 
     in which--
       ``(i) there is traditionally, and continues to be, a low 
     level of federal crop insurance participation and 
     availability; and
       ``(ii) the Secretary of Agriculture determines that the 
     state is underserved by federal crop insurance.
       ``(3) Research and development.--The Corporation shall 
     establish a program of research and development to develop 
     new approaches to increasing participation in States in 
     which--
       ``(i) there is traditionally, and continues to be, a low 
     level of federal crop insurance participation and 
     availability; and
       ``(ii) the Secretary of Agriculture determines that the 
     state is underserved by federal crop insurance.
       ``(4) Funding.--The following amounts shall be transferred 
     from funds made available in section 516(a)(2)(C) for the 
     Choice of Risk Management Options pilot program--
       ``(A) for the Education, Information and Insurance Provider 
     Recruitment program in paragraph (2), $10,000,000 for each of 
     fiscal years 2001 through 2004.
       ``(B) for the Research and Development program in paragraph 
     (3) $5,000,000 for each of fiscal years 2001-2004.''.

     SEC. 206. CONFORMING AMENDMENTS.

       On page 65, line 23, strike ``section 102(a)'' and insert 
     ``section 107''.
       On page 65, line 25, strike ``(8)'' and insert ``(9)''.
       On page 72, lines 18 and 19, strike ``section 204(a)(2)'' 
     and insert ``section 206(a)(2)''.
       On page 77, strike lines 1 through 7 and insert the 
     following:
       ``(2) Purchase during insurance period.--A producer of a 
     specialty crop may purchase new coverage or increase coverage 
     levels for the specialty crop at any time during the 
     insurance period, subject to a 30-day waiting period and an 
     inspection by the insurance provider to verify acceptability 
     by the insurance provider, if the Corporation determines that 
     the risk associated with the crop can be adequately rated.
       On page 79, strike line 8 and all that follows through page 
     91, line 11, and insert the following:

     SEC. 310. FEDERAL CROP INSURANCE IMPROVEMENT COMMISSION.

       Section 515 of the Federal Crop Insurance Act (7 U.S.C. 
     1515) is amended to read as follows:

     ``SEC. 515. FEDERAL CROP INSURANCE IMPROVEMENT COMMISSION.

       ``(a) Definitions.--In this section:
       ``(1) Commission.--The term `Commission' means the Federal 
     Crop Insurance Improvement Commission established by 
     subsection (b).
       ``(b) Establishment of Commission.--There is established a 
     Commission to be known as the `Federal Crop Insurance 
     Improvement Commission'.
       ``(c) Membership.--
       ``(1) In general.--The Commission shall be composed of the 
     following 13 members:
       ``(A) The Under Secretary for Farm and Foreign Agricultural 
     Services of the Department.
       ``(B) The manager of the Corporation.
       ``(C) The Chief Economist of the Department or a person 
     appointed by the Chief Economist.
       ``(D) An employee of the Office of Management and Budget, 
     appointed by the Director of the Office of Management and 
     Budget.
       ``(E) A representative of the National Association of 
     Insurance Commissioners, experienced in insurance regulation, 
     appointed by the Secretary.
       ``(F) Representatives of 4 approved insurance providers or 
     related organizations that provide advisory or analytical 
     support to the crop insurance industry, appointed by the 
     Secretary.
       ``(G) 2 agricultural economists from academia, appointed by 
     the Secretary.
       ``(H) 2 representatives of major farm organizations and 
     farmer-owned cooperatives, appointed by the Secretary.
       ``(2) Time of appointment.--The members of the Commission 
     shall be appointed not later than 60 days after the date of 
     enactment of the Risk Management for the 21st Century Act.
       ``(3) Term.--A member of the Commission shall serve for the 
     life of the Commission.
       ``(d) Duties.--The Commission shall review and make 
     recommendations concerning the following issues:
       ``(1) The extent to which approved insurance providers 
     should bear the risk of loss for federally subsidized crop 
     insurance.
       ``(2) Whether the Corporation should--
       ``(A) continue to provide financial assistance for the 
     benefit of agricultural producers by reinsuring coverage 
     written by approved insurance providers; or
       ``(B) provide assistance in another form, such as by acting 
     as an excess insurer.
       ``(3) The extent to which development of new insurance 
     products should be undertaken by the private sector, and how 
     to encourage such development.
       ``(4) How to focus research and development of new 
     insurance products to include the development of--
       ``(A) new types of products such as combined area and yield 
     and whole farm revenue coverages; and
       ``(B) insurance products for specialty crops.
       ``(5) The use by the Corporation of private sector 
     resources under section 507(c).
       ``(6) The progress of the Corporation in reducing 
     administrative and operating costs of approved insurance 
     providers under section 508(k)(5).
       ``(7) The identification of methods, and of organizational, 
     statutory, and structural changes, to enhance and improve--
       ``(A) delivery of reasonably priced crop insurance products 
     to agricultural producers;
       ``(B) loss adjustment procedures;
       ``(C) good farming practices;
       ``(D) the establishment of premiums; and
       ``(E) compliance with this title (including regulations 
     issued under this title, the terms and conditions of 
     insurance coverage, and adjustments of losses).

[[Page S1575]]

       ``(e) Commission Operations.--
       ``(1) Chairperson; voting.--The Under Secretary for Farm 
     and Foreign Agricultural Services of the Department of 
     Agriculture shall--
       ``(A) serve as Chairperson of the Commission; and
       ``(B) vote in the case of a tie.
       ``(2) Meetings.--The Commission shall meet regularly, but 
     not less than 6 times per year.
       ``(3) Disclosure.--To the extent that the records, papers, 
     or other documents received, prepared, or maintained by the 
     Commission are subject to public disclosure, the documents 
     shall be available for public inspection and copying at the 
     Office of Risk Management.
       ``(f) Final Report.--
       ``(1) In general.--Not later than 2 years after the date of 
     enactment of the Risk Management for the 21st Century Act, 
     the Commission shall submit to the Committee on Agriculture 
     of the House of Representatives and the Committee on 
     Agriculture, Nutrition, and Forestry of the Senate a final 
     report on the review under subsection (d).
       ``(2) Copies.--The Commission shall provide copies of the 
     final report to--
       ``(A) the Secretary; and
       ``(B) the Board.
       ``(3) Interim reports.--To expedite completion of the work 
     of the Commission, the Commission may submit 1 or more 
     interim reports or reports on 1 or more of the issues to be 
     reviewed.
       ``(g) Termination.--The Commission shall terminate on the 
     earlier of--
       ``(1) 60 days after the date on which the Commission 
     submits the final report under subsection (f); or
       ``(2) September 30, 2004.
       ``(h) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this section.''.
       On page 92, strike lines 7 through 13 and insert the 
     following:

     SEC. 312. PROJECTED LOSS RATIO.

       Section 506(o) of the Federal Crop Insurance Act (7 U.S.C. 
     1506(o)) is amended by striking paragraph (2) and inserting 
     the following:
       ``(2) Projected loss ratio.--The Corporation shall take 
     such actions, including the establishment of adequate 
     premiums, as are necessary to improve the actuarial soundness 
     of Federal multiperil crop insurance made available under 
     this title to achieve--
       ``(A) during the period beginning on October 1, 1998, and 
     ending with the 2001 crop year, an overall projected loss 
     ratio of not greater than 1.075; and
       ``(B) beginning with the 2002 crop year, an overall 
     projected loss ratio of not greater than 1.0.''.

     SEC. 313. COMPLIANCE WITH STATE LICENSING REQUIREMENTS.

       Section 508 of the Federal Crop Insurance Act (7 U.S.C. 
     1508) (as amended by section 206(a)(1)) is amended by adding 
     at the end the following:
       ``(n) Compliance With State Licensing Requirements.--Any 
     person that sells or solicits the purchase of a policy or 
     plan of insurance or adjusts losses under this title, 
     including catastrophic risk protection, in any State shall be 
     licensed and otherwise qualified to do business in that 
     State, and shall comply with all State regulation of such 
     sales and solicitation activities (including commission and 
     anti-rebating regulations), as required by the appropriate 
     insurance regulator of the State in accordance with the 
     relevant insurance laws of the State.''.
                   TITLE IV--MISCELLANEOUS PROVISIONS

     SEC. 401. IMPROVED RISK MANAGEMENT EDUCATION.

       Title IV of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (7 U.S.C. 7621 et seq.) is 
     amended by adding at the end the following:

     ``SEC. 409. IMPROVED RISK MANAGEMENT EDUCATION FOR 
                   AGRICULTURAL PRODUCERS.

       ``(a) Definitions.--In this section:
       ``(1) Center.--The term `Center' means a Risk Management 
     Education Coordinating Center established under subsection 
     (c)(1).
       ``(2) Land-grant college.--The term `land-grant college' 
     means any 1862 Institution, 1890 Institution, or 1994 
     Institution.
       ``(b) Program.--
       ``(1) In general.--The Secretary shall carry out a program 
     to improve the risk management skills of agricultural 
     producers, including the owners and operators of small farms, 
     limited resource producers, and other targeted audiences, to 
     make informed risk management decisions.
       ``(2) Purpose.--The program shall be designed to assist a 
     producer to develop the skills necessary--
       ``(A) to understand the financial health and capability of 
     the producer's operation to withstand price fluctuations, 
     adverse weather, environmental impacts, diseases, family 
     crises, and other risks;
       ``(B) to understand marketing alternatives, how various 
     commodity markets work, the use of crop insurance products, 
     and the price risk inherent in various markets; and
       ``(C) to understand legal, governmental, environmental, and 
     human resource issues that impact the producer's operation.
       ``(c) Coordinating Centers.--
       ``(1) Establishment and purpose.--The Secretary shall 
     establish a Risk Management Education Coordinating Center in 
     each of 5 regions of the United States (as determined by the 
     Secretary) to administer and coordinate the provision of risk 
     management education to producers and their families under 
     the program in that region.
       ``(2) Site selection.--
       ``(A) In general.--The Secretary shall locate the Center 
     for a region at--
       ``(i) a risk management education coordinating office of 
     the Cooperative State Research, Education, and Extension 
     Service that is in existence at a land-grant college on the 
     date of enactment of this section; or
       ``(ii) an appropriate alternative land-grant college in the 
     region approved by the Secretary.
       ``(B) Land-grant colleges.--To be selected as the location 
     for a Center, a land-grant college must have the demonstrated 
     capability and capacity to carry out the priorities, funding 
     distribution requirements, and reporting requirements of the 
     program.
       ``(d) Coordinating Council.--
       ``(1) Establishment.--Each Center shall establish a 
     coordinating council to assist in establishing the funding 
     and program priorities for the region for which the Center 
     was established.
       ``(2) Membership.--Each council shall consist of a minimum 
     of 5 members, including representatives from--
       ``(A) public organizations;
       ``(B) private organizations;
       ``(C) agricultural producers; and
       ``(D) the Regional Service Offices of the Risk Management 
     Agency in that region.
       ``(e) Center Activities.--
       ``(1) Instruction for risk management professionals.--Each 
     Center shall coordinate the offering of intensive risk 
     management instructional programs, involving classroom 
     learning, distant learning, and field training work, for 
     professionals who work with agricultural producers, including 
     professionals who are--
       ``(A) extension specialists;
       ``(B) county extension faculty members;
       ``(C) private service providers; and
       ``(D) other individuals involved in providing risk 
     management education.
       ``(2) Education programs for producers.--Each Center shall 
     coordinate the provision of educational programs, including 
     workshops, short courses, seminars, and distant-learning 
     modules, to improve the risk management skills of 
     agricultural producers and their families.
       ``(3) Development and dissemination of materials.--Each 
     Center shall coordinate the efforts to develop new risk 
     management education materials and the dissemination of such 
     materials.
       ``(4) Coordination of resources.--
       ``(A) In general.--Each Center shall make use of available 
     and emerging risk management information, materials, and 
     delivery systems, after careful evaluation of the content and 
     suitability of the information, materials, and delivery 
     systems for producers and their families.
       ``(B) Use of available expertise.--To assist in conducting 
     the evaluation under subparagraph (A), each Center shall use 
     available expertise from land-grant colleges, nongovernmental 
     organizations, government agencies, and the private sector.
       ``(f) Grants.--
       ``(1) Special grants.--Each Center shall reserve a portion 
     of the funds provided under this section to make special 
     grants to land-grant colleges and private entities in the 
     region to conduct 1 or more of the activities described in 
     subsection (e).
       ``(2) Competitive grants.--Each Center shall reserve a 
     portion of the funds provided under this section to conduct a 
     competitive grant program to award grants to both public and 
     private entities that have a demonstrated capability to 
     conduct 1 or more of the activities described in subsection 
     (e).
       ``(g) National Agriculture Risk Education Library.--The 
     National Agriculture Risk Education Library shall--
       ``(1) serve as a central agency for the coordination and 
     distribution of risk management educational materials; and
       ``(2) provide a means for the electronic delivery of risk 
     management information and materials.
       ``(h) Funding Provisions.--
       ``(1) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this section $30,000,000 for 
     fiscal year 2001 and each subsequent fiscal year.
       ``(2) Distribution.--
       ``(A) National agriculture risk education library.--For 
     each fiscal year, of the funds made available to carry out 
     this section, 2.5 percent shall be distributed to the 
     National Agriculture Risk Education Library.
       ``(B) Centers.--For each fiscal year, the remainder of the 
     funds made available to carry out this section shall be 
     distributed equally among the Centers.
       ``(C) Administration by land-grant colleges.--The land-
     grant college at which a Center is located shall be 
     responsible for administering and disbursing funds described 
     in subparagraph (B), in accordance with applicable State and 
     Federal financial guidelines, for activities authorized by 
     this section.
       ``(3) Prohibition on construction.--
       ``(A) Location of centers.--Each Center shall be located in 
     a facility in existence on the date of enactment of this 
     section.
       ``(B) Prohibition.--Funds provided under this section shall 
     not be used to carry out construction of any facility.

[[Page S1576]]

       ``(i) Evaluation.--The Secretary, acting through the 
     Cooperative State Research, Education, and Extension Service, 
     shall evaluate the activities of each Center to determine 
     whether the risk management skills of agricultural producers 
     and their families are improved as a result of their 
     participation in educational activities financed using funds 
     made available under subsection (h).''.

     SEC. 402. SENSE OF THE SENATE REGARDING THE FEDERAL CROP 
                   INSURANCE PROGRAM.

       It is the sense of the Senate that--
       (1) farmer-owned cooperatives play a valuable role in 
     achieving the purposes of the Federal Crop Insurance Act (7 
     U.S.C. 1501 et seq.) by--
       (A) encouraging producer participation in the Federal crop 
     insurance program;
       (B) improving the delivery system for crop insurance; and
       (C) helping to develop new and improved insurance products;
       (2) the Risk Management Agency, through its regulatory 
     activities, should encourage efforts by farmer-owned 
     cooperatives to promote appropriate risk management 
     strategies among their membership;
       (3) partnerships between approved insurance providers and 
     farmer-owned cooperatives provide opportunity for 
     agricultural producers to obtain needed insurance coverage on 
     a more competitive basis and at a lower cost;
       (4) the Risk Management Agency is following an appropriate 
     regulatory process to ensure the continued participation by 
     farmer-owned cooperatives in the delivery of crop insurance;
       (5) efforts by the Risk Management Agency to finalize 
     regulations that would incorporate the currently approved 
     business practices of cooperatives participating in the 
     Federal crop insurance program should be commended; and
       (6) not later than 180 days after the date of enactment of 
     this Act, the Federal Crop Insurance Corporation should 
     complete promulgation of the proposed rule entitled ``General 
     Administrative Regulations; Premium Reductions; Payment of 
     Rebates, Dividends, and Patronage Refunds; and Payments to 
     Insured-Owned and Record-Controlling Entities'', published by 
     the Federal Crop Insurance Corporation on May 12, 1999 (64 
     Fed. Reg. 25464), in a manner that--
       (A) effectively responds to comments received from the 
     public during the rulemaking process;
       (B) provides an effective opportunity for farmer-owned 
     cooperatives to assist the members of the cooperatives to 
     obtain crop insurance and participate most effectively in the 
     Federal crop insurance program;
       (C) incorporates the currently approved business practices 
     of farmer-owned cooperatives participating in the Federal 
     crop insurance program; and
       (D) protects the interests of agricultural producers.
           TITLE V--EFFECTIVE DATES; TERMINATION OF AUTHORITY

     SEC. 501. EFFECTIVE DATES.

       (a) In General.--Except as provided in subsections (b) and 
     (c)(2) and section 502(a), this Act and the amendments made 
     by this Act take effect on the date of enactment of this Act.
       On page 92, line 15, insert ``subsection (c)(2) and'' after 
     ``carry out''.
       On page 92, line 17, strike ``204'' and insert ``206''.
       Beginning on page 92, strike line 23 and all that follows 
     through page 93, line 9, and insert the following:
       (2) Indemnity payments for certain producers of durum 
     wheat.--
       (A) In general.--Except as otherwise provided in this 
     paragraph, notwithstanding section 508(c)(5) of the Federal 
     Crop Insurance Act (7 U.S.C. 1508(c)(5)), a producer of durum 
     wheat that purchased a 1999 Crop Revenue Coverage wheat 
     policy by the sales closing date prescribed in the actuarial 
     documents in the county where the policy was sold shall 
     receive an indemnity payment in accordance with the policy.
       (B) Base and harvest prices.--The base price and harvest 
     price under the policy shall be determined in accordance with 
     the Commodity Exchange Endorsement for wheat published by the 
     Federal Crop Insurance Corporation on July 14, 1998 (63 Fed. 
     Reg. 37829).
       (C) Reinsurance.--Subject to subparagraph (B), 
     notwithstanding section 508(c)(5) of the Federal Crop 
     Insurance Act (7 U.S.C. 1508(c)(5)), the Corporation shall 
     provide reinsurance with respect to the policy in accordance 
     with the Standard Reinsurance Agreement.
       (D) Voiding of bulletin.--Bulletin MGR-99-004, issued by 
     the Administrator of the Risk Management Agency of the 
     Department of Agriculture, is void.
       (E) Effective date.--This paragraph takes effect on October 
     1, 2000.
       On page 93, line 10, strike ``SEC. 402.'' and insert ``SEC. 
     502.''.
       On page 94, strike lines 1 and 2 and insert the following:
     1508(a)) is amended by redesignating paragraph (8) (as added 
     by section 107) and paragraph (9) (as added by section 305) 
     as paragraph (7) and paragraph (8), respectively.
       On page 94, line 5, strike ``203'' and insert ``205''.
       On page 94, line 24, strike ``subsection (c)'' and insert 
     ``subsections (c), (d), and (e)''.
       On page 45, between lines 2 and 3, insert the following:

     SEC. 204. OPTIONS PILOT PROGRAM.

       (a) In General.--Section 191 of the Agricultural Market 
     Transition Act (7 U.S.C. 7331) is amended--
       (1) in the first sentence of subsection (a), by striking 
     ``2002'' and inserting ``2004'';
       (2) in subsection (b)--
       (A) in the first sentence, by striking ``100 counties, 
     except that not more than 6'' and inserting ``300 counties, 
     except that not more than 25''; and
       (B) in the second sentence, by striking ``2002'' and 
     inserting ``2004''; and
       (3) in subsection (c)(2), by inserting before the semicolon 
     the following: ``during any calendar year in which a county 
     in which the farm of the producer is located is authorized to 
     operate the pilot program''.
       (b) Funding.--From amounts made available under section 
     516(a)(2)(C) of the Federal Crop Insurance Act (7 U.S.C. 
     1516(a)(2)(C)) (as added by section 203(b)(2)(C)) for the 
     choice of risk management options pilot program, the Federal 
     Crop Insurance Corporation shall transfer to the Secretary of 
     Agriculture to carry out the amendments made by subsection 
     (a) $27,000,000 for each of fiscal years 2002 through 2004.
       On page 45, line 3, strike ``SEC. 204.'' and insert ``SEC. 
     205.''.
       On page 72, line 19, strike ``204(a)(2)'' and insert 
     ``205(a)(2)''.
       On page 92, line 17, strike ``204'' and insert ``205''.

  Mr. LUGAR. Mr. President, this completes the amendments list. At this 
point, I yield the floor to Senators who wish to speak on the bill.
  The PRESIDING OFFICER. The Senator from Arkansas.
  Mrs. LINCOLN. I thank the Chair.
  I am very pleased to support a crop insurance reform bill that has 
been a long while in the making. I compliment the chairman of the 
Senate Agriculture Committee for his diligence in this. He has 
certainly worked hard and put forth a great effort in working with all 
of us to come up with a final product. I appreciate his diligence and 
patience and all his hard work and wisdom that have gone into it.
  As we all know, the Budget Committee included funds to reform our 
ailing Crop Insurance Program last year. I have been working diligently 
with the Senate Agriculture Committee to develop a bill that will 
improve the current program because for us in the South, the current 
program doesn't work. What we are considering today is the result of 
the efforts and hard work of all of us.
  I believe this bill makes fundamental changes to the existing Federal 
Crop Insurance Program that are necessary to make crop insurance more 
workable and affordable for producers across the country, and I urge 
its passage. Congress has been attempting to eliminate the ad hoc 
disaster program for years because it is not the most effective way of 
helping our farmers who suffer yield losses.
  Last year, Senator Cochran and I introduced a comprehensive bill that 
addressed what we saw as the various reforms necessary in the Crop 
Insurance Program. I am pleased that many of those provisions are 
included in the bill we are considering today.
  As we all know, the Government's role in farm programs has changed. 
The 1996 farm bill phased out our traditional support for our farmers, 
and the current farm programs require producers to assume more risk 
than ever before.
  Due to the agricultural economic crisis we are experiencing, there 
has been much discussion lately on the issues of the safety net for our 
Nation's producers. On that point, I will be perfectly clear. Crop 
insurance is a risk management tool to help producers guard against 
yield loss. It was not created and was never intended to be, and will 
never be, the end-all, be-all solution for the income needs of our 
Nation's producers.
  As the crop insurance reform debate proceeds, I am hopeful my 
colleagues will be cognizant of the various needs in the agricultural 
community and recognize that while crop insurance is an important part 
of the safety net, it is not and should not be the only income guard 
for our Nation's farmers.
  In Arkansas, the last estimates I heard indicated that fewer than 2 
percent of our cotton producers were participating in the buy-up 
program. Buy-up coverage for all commodities in Arkansas historically 
is below 20 percent. That tells me the producers in my home State don't 
think crop insurance is currently providing the kind of help they need.
  In the South, we traditionally grow capital-intensive crops. As we 
have

[[Page S1577]]

grown these crops in the past, and certainly as we will in the future, 
the way the current Crop Insurance Program is structured, the rating 
program has never suited our needs or made it a good business decision 
for southern farmers to purchase crop insurance. This bill establishes 
a process for reevaluating crop insurance rates for all crops and for 
lowering those rates if warranted.
  It was only after pressure from Congress last year that the risk 
management agency reduced rates by as much as 50 percent for cotton in 
Arkansas and the Midsouth. The provision included in today's bill will 
require further review of all southern commodities in the rating 
structure. By making the Crop Insurance Program more affordable, 
additional producers will be encouraged to participate in the program 
and protect themselves against the unforeseeable factors that will be 
working against them once they put a crop into the ground. This is the 
ultimate goal, to get more participation in our insurance program.
  The bill also provides for an enhanced subsidy structure so producers 
are encouraged to buy up from their current level of coverage. The 
structure included in this bill will make the step from catastrophic to 
buy-up easier for producers and will make obtaining the highest level 
of coverage easier for those who are already participating in the Crop 
Insurance Program.
  In an attempt to improve the recordkeeping process within USDA, this 
legislation also requires that FSA and RMA coordinate their 
recordkeeping activities. Current USDA recordkeeping, split between FSA 
and the RMA, is redundant and insufficient. By including both Crop 
Insurance Program participants and nonprogram participants in the 
process, we hope to enhance the agricultural data held by the agency 
and make acreage and yield reporting less of a hassle for already 
overburdened producers.
  In addition, this bill establishes a role for consultation with State 
FSA committees in the introduction of new coverage to a State. The need 
for this provision was made abundantly clear to Arkansas' rice 
producers last spring.
  A private insurance policy was offered to farmers at one rate, only 
to have the company reduce the rate once the amount of potential 
exposure was realized.
  In my discussions with various executives from the company on this 
issue it became apparent that their knowledge of the rice industry was 
fairly minimal. Had they consulted with local FSA committees who had a 
working knowledge of the rice industry before introduction of the 
policy, the train wreck that occurred might have been stopped in its 
tracks.
  I am pleased that another reform measure that I worked on has been 
included to help rice producers suffering losses caused by drought.
  Recent droughts have left many Arkansas farmers with low reservoirs 
and depleting aquifers. If rains do not replenish them, an adequate 
irrigation supply may not exist by summer.
  In addition, drought conditions in Louisiana have caused salt to 
intrude into the water supply used for irrigation on many farms. 
Current law states that rice is excluded from drought policies because 
it is irrigated. This is not equitable since rice producers do suffer 
losses due to drought.
  I have worked with Senators Breaux and Landrieu to provide these 
policies for our rice producers who are experiencing reduced irrigation 
opportunities due to the severe drought conditions that have plagued 
the South for the last two years. I am pleased that this provision has 
been included in the bill. I thank Senators Landrieu and Breaux for 
their hard work on it.
  Many of the problems associated with the crop insurance program have 
been addressed in previous reform measures. However, fraud and abuses 
are still present to some degree.
  This bill strengthens the monitoring of agents and adjusters to 
combat fraud and enhances the penalties available to USDA for 
companies, agents and producers who engage in fraudulent activities.
  There is simply no room for bad actors that recklessly cost the 
taxpayers money.
  In closing, Mr. President, I was prepared during our committee markup 
earlier this month to offer an amendment related to a cooperative's 
role in the delivery of crop insurance.
  I held off at that time due to concerns from the committee related to 
possible ``rebating'' ramifications and preemption of state law.
  I am pleased that Senators Kerrey and Grassley, as well as the Risk 
Management Agency, were willing to work with me to include my amendment 
in this bill.
  This amendment does nothing to preempt state law or even change 
current federal law. It simply provides that current approved business 
practices be maintained.
  With the inclusion of my amendment Congress is recognizing the 
valuable role cooperatives play in the crop insurance program, 
specifically, encouraging producer participation in the crop insurance 
program, improving the delivery system for crop insurance, and helping 
to develop new and improved insurance products.
  My amendment requires the Risk Management Agency to finalize 
regulations that would incorporate the currently approved business 
practices of cooperatives participating in the crop insurance program 
and to do so within 180 days of enactment of this act.
  If farmer owned entities are not allowed to sell crop insurance, then 
anyone can sell crop insurance in America except an American farmer. 
Such a legal result would give the appearance that crop insurance is 
designed for a closed club to exploit farmers.
  In my opinion, that appearance would inhibit broader use of crop 
insurance, which is the overall objective we have been trying to reach. 
I don't believe that such a result is the intent of those who have put 
so much effort into improving the Crop Insurance Program, and I am 
pleased our amendment has been worked in.
  Mr. President, I personally want to thank all of the staff members of 
the committee and the industry representatives who have helped in this 
effort. It certainly doesn't happen without their long hours of work, 
diligence, and perseverance in making all of this come together.
  Arkansas farmers have told me time and time again that crop insurance 
isn't affordable for the amount of coverage they receive. As the 
program currently exists, it does not make sound business sense to 
purchase crop insurance in our State. Since this reform process began, 
I have been working to correct this inequity. I hope the changes we 
make today will lead to a Crop Insurance Program that is equitable, 
affordable, and effective.
  I yield the floor.
  Mr. LUGAR. Mr. President, the Senator from Alaska has asked the 
Senate to consider adding wild salmon to the list of crops for a pilot 
study is to be conducted as a basis for making federally-sponsored crop 
insurance available to fishermen. My understanding is that this is not 
the first time that the Department of Agriculture would be reviewing 
fish stocks for crop insurance. In the past, there was concern that 
wild fish can be too hard to track, and that fisheries managers don't 
really know when the stocks have failed. However, fisheries managers 
track fish stocks, especially wild salmon, very closely.
  Mr. STEVENS. My good friend, the chairman of the Agriculture 
Committee, is correct. The State of Alaska has been managing wild 
salmon since statehood more than 40 years ago. In fact, one of the 
driving forces behind our statehood movement was to gain management 
control over our resources, particularly the salmon fisheries. I see my 
friend, the Senator from Kansas, may have a question on fisheries 
management.
  Mr. ROBERTS. And is it true that fisheries managers can accurately 
predict how much fish can be caught from year-to-year?
  Mr. STEVENS. The chairman of the Agriculture Committee is correct. 
Fisheries managers try to ensure that salmon returning to spawn reach 
their escapement goal, which is the number of spawners needed to return 
a heathly population of juveniles to the streams and oceans. 
Historically, managers can accurately estimate how many fish are 
expected to return based on the lifespan of the salmon and the 
escapement numbers from previous years. Fisheries managers also track 
historical trends, which are often linked to long term weather cycles, 
and their relationship to escapement numbers. The State of Alaska in 
particular uses in-season

[[Page S1578]]

management to ensure its pre-season escapement goals.
  However, occasionally the fish do not return. For example, chum 
salmon runs in areas of western Alaska were at all time lows in 1997 
and 1998. The low chum runs have had a devastating effect on the 
western Alaska economy. This exactly the type of crisis that could be 
alleviated by making crop insurance available to salmon fishermen. 
Fishermen are the farmers of the sea, and they deserve the same 
protections we afford to our farmers in the inland states.
  Mr. LUGAR. I thank the Senator from Alaska for informing us of these 
aspects of fish harvests.
  Mr. STEVENS. I thank the Senator from Indiana and the Senator from 
Kansas for their hard work on this important legislation and for 
addressing my request.
  Mr. DASCHLE. Mr. President, the farmers and ranchers of this country 
have been struggling with terrible economic conditions over the past 
three years. They have seen their prices collapse and remain at, or in 
many cases below, the cost of production. Not only have farmers in my 
state and across the country endured these low prices, they have also 
been subject to the unpredictable forces of droughts, floods and crop 
disease.
  We have before us a bill that will help farmers and ranchers survive 
these bad times and manage production risks. S. 2251, the Risk 
Management for the 21st Century Act, is a comprehensive approach to 
reforming and improving crop insurance for producers across the 
country. It will make the federal crop insurance program more 
affordable and effective.
  Currently, the government provides subsidies for multi-peril crop 
insurance, but subsidies are progressively less at higher levels of 
coverage. This aspect of the crop insurance program often has the 
effect of restricting farmers from investing in the most efficient 
levels of coverage for their farms. This bill inverts this subsidy, so 
the higher levels of coverage are subsidized at the highest levels. 
This makes meaningful and comprehensive coverage much more affordable 
to farmers in this country who rely on the program to manage their 
production risks.
  This bill also addresses another issue of critical importance to 
farmers in South Dakota and nationwide. Many parts of the country have 
suffered devastating crop losses for several years in a row. As 
disastrous conditions persist, farmers' eligibility under the current 
crop insurance program decreases--the opposite of what common sense 
would dictate. This bill enables producers to protect and sustain their 
crop insurance eligibility so that crop insurance remains an 
economically viable option for them for the long term.
  This legislation also authorizes the Risk Management Agency (RMA) to 
develop insurance products on a pilot basis for livestock producers. 
For too long, we have excluded our cattle ranchers, hog producers, and 
other livestock producers from federal agriculture programs, including 
crop--or perhaps we should say ``commodity''--insurance. This bill 
expands the flexibility of the program in this way so that more 
producers can benefit from this important investment.
  This legislation also provides great benefits for producers of 
specialty crops. It improves catastrophic loss insurance coverage by 
increasing the access specialty crop farmers have to quality crop 
insurance policies. Current crop insurance policies do not cover the 
unique characteristics associated with the planting, growing, and 
harvesting of specialty crops. This bill will promote specialty crop 
producer participation in the federal crop insurance program, encourage 
higher levels of coverage than provided by catastrophic insurance, and 
enable those producers to make better planning and marketing decisions. 
Furthermore, the bill requires that at least fifty percent of the funds 
dedicated to research and development for new crop insurance products 
are focused on specialty crop product development. This legislation 
also specifically provides funds to the RMA to enter into public and 
private partnerships to develop specialty crop insurance policies, and 
authorizes funds for pilot programs that would be conducted at the 
state, regional, and national levels.
  Finally, this bill eliminates the area trigger for the non-insured 
assistance program, making any grower whose crop is uninsurable and who 
experiences a federally-declared disaster eligible for disaster funds.
  Some have shared a concern that this crop insurance plan does not 
adequately address the range of problems across the country. They 
should be assured that this bill was written with the input and support 
of lawmakers, farmers, and agricultural organizations from all regions 
of the country.
  The crop insurance program has grown in popularity over the last 
several years. This bill will significantly improve an already 
important and successful program. Effective and affordable crop 
insurance is a vital part of an improved safety net that farmers and 
ranchers need to protect themselves from production risks, and to 
survive and succeed this year and in years to come.
  But make no mistake. Passage of this bill is only one part of our 
overall effort to improve farm policy. We must consider the many other 
ways in which our current policies have contributed to the poor 
economic conditions plaguing our farmers and ranchers. I look forward 
to that debate.
  Mr. COCHRAN. Mr. President, I commend the distinguished chairman of 
the committee, Mr. Lugar, for his work on the legislation before the 
Senate today. The Senators from Kansas and Nebraska deserve 
commendation also because of their active influence in shaping this 
bill.
  I wish I could support this effort to reform crop insurance, but it 
has a built in bias against Southern agriculture. I supported the 
measure that was put before the Committee by the Chairman and I voted 
against the substitute amendment that was offered during the committee 
markup by the Senators from Kansas and Nebraska. Their amendment 
prevailed, and it is now the pending business before the Senate. The 
Chairman's mark offered farmers a choice between higher government 
contributions to their crop insurance premium or a new risk management 
payment that they could use for eligible activities which lower the 
financial risk of their farming operation.
  Farmers in Mississippi preferred the Lugar bill. Mississippi has the 
third lowest crop insurance participation rate in the country. This 
bill will not increase the participation rate in my state and I don't 
think it will eliminate the need for Congress to provide disaster 
assistance in the future.
  The bill now before the Senate, while including some of the 
programmatic changes that I have advocated and introduced in a bill 
with the distinguished Senator from Arkansas, Mrs. Lincoln, falls short 
of the reform that we have promised agriculture producers.
  Here are two specific examples. First, it contains a subsidy 
structure which heavily favors regions of the country which already 
have high crop insurance participation rates and low premiums. This 
bill will make premiums even lower for those producers, while at the 
same time, effectively raising rates for producers that purchase 
coverage in the middle levels. The effect of this subsidy structure is 
that farmers who currently purchase catastrophic coverage and want to 
move into higher levels of coverage will only benefit from this 
legislation if they buy at the lowest and highest levels of coverage. 
Otherwise, they would be better off under current law.
  Second, farming is not a ``one-size-fits-all'' enterprise, but some 
believe that crop insurance should be. This bill fails to provide 
benefits for those producers that find crop insurance to be 
uneconomical. Certainly many of the changes that are incorporated in 
this bill will result in lower premiums, but for some producers in 
Mississippi, that will not be enough.
  I am encouraged that the Committee has provided $500 million in a 
pilot program that may address the needs of those who find that crop 
insurance is not a good business decision. However, the funds provided 
are significantly less than those that were included in the Lugar bill 
and will likely not produce a program that will be meaningful. I hope 
that this amount will be increased in conference so that it can provide 
meaningful assistance while not setting dangerous precedents for future 
farm bill debates. I'm hopeful this legislation can be improved in 
conference with the other body.

[[Page S1579]]

  Mr. President, I will vote no on this bill, I will work with the 
Chairman and other committee members to resolve these concerns in 
conference.
  Mr. KOHL. Mr. President, I am pleased that my amendment to include 
dairy in this $6 billion crop insurance bill has been accepted by the 
bill managers and I thank them for their cooperation. In particular, I 
want to thank Senators Lugar, Kerrey, Roberts, and Daschle for their 
assistance. I look forward to working with them prior to and during 
conference to ensure my amendment is part of the final bill reported by 
the conference committee.
  Dairy farmers have for too long been without any risk management 
tools to help them manage the risk of milk price volatility. The Dairy 
Options Pilot Program, authorized by the 1996 farm bill, was set to 
expire in 2002 and would have reached its 100 county cap at the end 
this year. If we had allowed that to happen, we would have taken from 
dairy farmers this important educational risk management program at a 
time when milk prices have hit their lowest levels in more than two 
decades. The DOPP program helps farmers pay for the out-of-pocket costs 
of buying ``put'' options on the commodity exchanges while the pilot is 
in effect in their county. Equally important, the program requires that 
farmers participate in an education and training program on the use of 
the futures market for risk management purposes.
  My amendment extends the Dairy Options Pilot Program until 2004 and 
raises the number of counties that can participate to 300. Moreover, 
the amendment raises the number of counties in each state that can 
participate from six to 25. This is important to Wisconsin since, at 
the end of this year, Wisconsin would have hit its county cap as well.
  The DOPP, on top of forward contracting through their cooperatives or 
other milk buyers, provides dairy farmers with an additional risk 
management tool. It is a tool that will be available, under my 
amendment, to dairy farmers throughout the nation. It is a national 
program, not a regional program. And I hope my colleagues from other 
regions will join me in looking for every possible national tool we 
have to help dairy farmers across the United States.
  This is, Mr. President--and I cannot stress this enough--only one of 
the many things we need to do to help dairy farmers struggle through 
increased dairy market volatility. Dairy farmers in my state are 
hurting right now. The DOPP, while important, is not the answer to the 
unacceptably low milk prices. We must do more--much, much more. DOPP, 
even with my amendment, will still be available to farmers in only 300 
counties.
  That is why I am also seeking $500 million in additional dairy market 
loss payments to put more money in the pockets of dairy farmers. 
Farmers nationwide need that help right now and I hope to work to 
provide that assistance through my role as ranking Democrat on the 
Agricultural Appropriations subcommittee.
  I also want to work with my colleagues to craft a national dairy 
policy that will provide dairy farmers with a meaningful safety net 
that does not distort markets or provide unfair regional advantages.
  But I am pleased that S. 2251 bill will make this one tool--the 
DOPP--available to more farmers. It is, Mr. President, the very least 
we can do. And I thank the managers for working with me to include this 
amendment in the bill.
  Mr. MACK. Mr. President, I rise to make a few remarks regarding the 
Risk Management for the 21st Century Act.
  Floridians know all too well the impact of natural disasters on the 
agriculture community. While I am proud of the ability of our growers 
to rebuild their farms after such devastating losses, enormous disaster 
aid bills only serve as a band-aid fix to the problem. We must work 
harder to ensure that all farmers have access to the necessary risk-
management tools. This bill encourages growers to purchase appropriate 
levels of crop insurance, hopefully avoiding the band-aid fix in future 
appropriation measures.
  Florida is the ninth leading agricultural state in the nation, with 
annual farm receipts totaling $6 billion. The industry employs over 
80,000 people and generates more than $18 billion in related economic 
activity. In 1998, hard working Floridians produced more than 25 
billion pounds of food, and more than 2 million tons of livestock feed. 
I am proud to say that Florida leads the nation in production of 18 
major agricultural commodities including oranges, sugarcane and fresh 
tomatoes. With these statistics in mind, it is imperative to ensure 
that federal programs work with, not against, Florida's farmers.
  As an original co-sponsor of S. 1401, the Specialty Crop Insurance 
Act of 1999, I support the effort to reduce the dependence of the 
specialty crop industry on catastrophic loss insurance coverage by 
improving its access to quality crop insurance policies. By failing to 
account for the unique characteristics associated with farming 
specialty crops, current crop insurance policies do not include many 
specialty crop producers.
  Through promotion of affordable crop insurance policies, S. 1401 
would increase specialty crop producer participation in the Federal 
Crop Insurance Program. Today's legislation, S. 2251, the Risk 
Management for the 21st Century Act, includes many of these specialty 
crop provisions.
  This legislation requires that 50% of the funds dedicated to research 
and development for the new crop insurance products are focused on 
specialty crop product development. At a level of $20 million per year, 
the legislation authorizes the Risk Management Agency to enter into 
partnerships with private and public entities to increase the 
availability of risk management tools for specialty crops. The 
expertise of outside agencies will most certainly help the Risk 
Management Agency develop sound specialty crop insurance policies.
  The Risk Management for the 21st Century Act also includes an 
expansion of Risk Management Agency pilot authority, removal of the 
Non-insured Assistance Program (NAP) area trigger, incentives for 
growers who purchase ``buy-up'' coverage, and it proposes a premium 
refund for low-risk producers. These reforms will ease our nation's 
growers dependence on short sighted disaster relief bills.
  This bill is the product of countless hours of negotiation, and I 
believe it represents an incredible opportunity to improve our Federal 
Crop Insurance Program. The Agriculture Committee has been extremely 
helpful in including the interests of specialty crop producers, and I 
thank them for their time and effort. I urge my colleagues to support 
the Risk Management for the 21st Century Act.
  Thank you, Mr. President. I yield the floor.
  Mr. COVERDELL. Mr. President, I commend the Chairman for moving this 
issue forward today. One of Georgia farmers' biggest complaints has 
been the inadequacies of the crop insurance program. The current 
program does not work and needs to be substantially reformed. Georgia 
farmers and ranchers continue to experience severe financial 
difficulties as a result of the lowest commodity prices in a decade, 
the devastating loss of international markets, and back to back 
disasters. They need a crop insurance program that provides the most 
economic benefits possible. While Congress helped stave off disaster in 
rural America by providing economic and weather related loss assistance 
in the fiscal year 1999 and 2000, it is evident that more needs to be 
done. Farmers need risk management programs that provide some 
protection against weather related and economic losses beyond their 
control. As it currently stands, crop insurance is too expensive for 
most farmers and has resulted in a low participation rate by many 
Georgia farmers.
  The legislation before us today, while not perfect by any means, is a 
step in the right direction. I am reluctantly supporting this measure 
in an effort to move the debate forward. I would like to thank the 
Chairman for all his efforts on this important issue. While we are 
disappointed, of course, that the Chairman's mark did not prevail in 
committee. The Chairman's bill would have allowed Georgia farmers to 
choose whether or not traditional crop insurance was a viable risk 
management tool for their farms. There is $6 billion at stake though, 
and we need it to reform the program. The House has passed a bill with 
favorable provisions

[[Page S1580]]

for the Southeast. We intend to fight for perfections to the bill we 
pass today, so our region of the country is treated fairly.
  The Roberts/Kerry bill has many important reform provisions that were 
included in the Cochran/Lincoln bill, of which I was proud to be a 
cosponsor. Some of these provisions included are increased subsidy 
rates for farmers, affordable specialty crop insurance policies, multi-
year APH adjustments, equal prevented planting for all crops, and 
rating methodology reform. This bill also includes over $400 million 
for a risk management pilot program which we hope to tailor to the 
Georgia farmers' needs. All in all, this bill needs to go forward. We 
will ultimately arrive at a program that will be much better for our 
farmers than the status quo.
  Mr. GRAHAM. Mr. President, members of the Senate, I am proud to offer 
my support for the legislation. As many before me have said, this bill 
is the product of extended debate and compromise on all sides of this 
debate.


            crop insurance is a tool to reduce disaster aid

  Over the last 3 years, we have passed large disaster aid packages to 
farmers. Over the last 2 years, we have spent billions of dollars in 
disaster relief for farmers.
  Mr. President, Benjamin Franklin said it best: a stitch in time saves 
nine. If we invest in crop insurance, it will significantly lower the 
costs associated with agricultural disasters. The choice is simple: 
give farmers the tools they need to plan for catastrophic weather, or 
risk emergency, after-the-fact spending that impedes our ability to 
preserve social security.
  Of particular interest to my state of Florida are the provisions in 
this legislation dealing with the needs of specialty crop producers. 
Agriculture in Florida has many different faces. There are 40,000 
commercial farmers in the state.
  In 1997, Florida farmers utilized a little more than 10 million of 
the state's nearly 35 million acres to produce more than 25 billion 
pounds of food and more than 2 million tons of livestock feed.
  Florida ranks number nine nationally in the value of its farm 
products and number two in the value of its vegetable crops. Florida 
agriculture is not only valuable, but also diverse. Florida ranks 
number two nationally in horticulture production with annual sales of 
over $1 billion. Florida grows 77 percent of U.S. grapefruits and 47 
percent of the world supply. The state produces 75 percent of the 
nation's oranges and 20 percent of the world supply.
  Florida's farmers led the Nation in the production of 18 major 
agriculture commodities in 1997 ranging from oranges and grapefruits, 
to a wide variety of vegetables, to tropical fish. Florida livestock 
and products sales were $1.1 billion in 1997. Florida is the largest 
milk-producing State in the southeast. The bottom line for Florida 
agriculture is that our State has a wide variety of non-traditional 
crops.
  On July 29, 1999 I introduced S. 1401, the Specialty Crop Insurance 
Act of 1999, with my colleagues Senators Mack, Feinstein, Boxer, and 
Bingaman. This legislation sought to reduce the dependence of the 
specialty crop industry on catastrophic loss insurance coverage by 
improving its access to quality crop insurance policies.
  Current crop insurance policies available for specialty crops do not 
cover the unique characteristics associated with the planting, growing, 
and harvesting of specialty crops. We need a different approach for 
this unique sector of U.S. agriculture.
  Our legislation sought to promote the development and use of 
affordable specialty crop insurance policies. This action is intended 
to increase specialty crop producer participation in the Federal Crop 
Insurance Program, encourage higher levels of coverage than provided by 
catastrophic insurance, and encourage better planning and marketing 
decisions.
  I am extremely pleased that the legislation we are considering today 
incorporates the provisions in my legislation.
  (1) The biggest problem for specialty crop growers is availability of 
affordable policies. According to a 1999 GAO Report on USDA's progress 
in expanding crop insurance coverage for specialty crops, even after an 
expansion in policies available to specialty crops planned through 
2001, the existing crop insurance program will fail to cover 
approximately 300 specialty crops that make up 15 percent of the market 
share.
  To increase the availability of affordable crop insurance products, I 
proposed that we give the Risk Management Agency the resources and the 
ability to tap into expertise in the private sector during product 
development. S. 2251 accomplishes this goal.
  The bill before us today requires that at least 50 percent of the 
funds dedicated to research and development for new crop insurance 
products are focused on specialty crop product development. Fifty 
percent of these funds are to be spent on outside contractors, giving 
those with expertise on specialty crops the opportunity to develop 
policies.
  The legislation specifically authorizes $20 million per year for RMA 
to enter into public and private partnerships to develop specialty crop 
insurance policies.
  It also establishes a process to review new product development and 
ensure that crop insurance products are available to all agricultural 
commodities, including specialty crops.
  I believe the actions taken by S. 2251 will give RMA the authority 
and resources it needs to use the expertise of the private sector to 
develop good crop insurance products for specialty crops.
  (2) To further encourage development of new policies, I proposed 
expansion of the RMA pilot authority. This legislation authorizes funds 
for pilot programs. It allows pilots to be conducted on state, 
regional, and national basis for a period of four years to be extended 
if desired by RMA. S. 2251 also includes the authority for RMA to 
conduct a pilot program on crop insurance for timber, a provision I 
originally introduced on April 22 of last year in S. 868, the Forestry 
Initiative to Restore the Environment.
  (3) Growers who do not have access to crop insurance policies depend 
on the Non-insured Assistance Program (NAP). To ensure that aid from 
this program actually reaches farmers in need, I proposed elimination 
of the area trigger for non-insured assistance program, making any 
grower whose crop is uninsurable and experiences a federally-declared 
disaster, eligible for these funds. This bill does the same.
  (4) My legislation took action to encourage growers to purchase buy-
up coverage. The Risk Management for the 21st Century Act increases the 
rate for 50/100 coverage, the initial buy-up level after catastrophic 
coverage to 60 percent.
  (5) To encourage farmers to take proactive risk management action, 
both my legislation and S. 2251 propose a premium refund for low-risk 
producers.
  I believe that the provisions in the Risk Management for the 21st 
Century Act will ensure that specialty crop producers have access to 
high-quality insurance products designed to meet their needs.
  I am pleased that the goals of my legislation, S. 1401, the Specialty 
Crop Insurance Act of 1999, are met by the legislation before us today. 
I commend my colleagues for their efforts to ensure that crop insurance 
reform passed by the 106th Congress will take into account the needs of 
all agriculture producers, not just one sector. I offer my support for 
this legislation and urge my colleagues to do the same.
  Mr. BAUCUS. Mr. President, this is an important day. Today we are 
finally bringing to bear over eighteen months of hard work toward 
reforming the Federal Crop Insurance Program. This is an issue of vital 
importance to Montana.
  First, however, I urge my colleagues in the Senate to join me in 
applauding Senators Roberts and Kerrey for their hard work in bringing 
a comprehensive solution to the table as well as Chairman Lugar for 
helping us work quickly to pass this important legislation. We can all 
be proud of a job well done.
  The bill before you to day, the Risk Management for the Twenty First 
Century Act, is a fine example of what can be done when we work on a 
bipartisan basis to solve a difficult problem. I am pleased that 
Montana producers and crop insurance providers also contributed largely 
to this effort.
  Last spring, I held a crop insurance community hearing in Shelby, MT. 
Ken

[[Page S1581]]

Ackerman, director of the Risk Management Agency, flew out for that 
hearing and got quite an earful. Montana farmers told us they wanted a 
program they could count on. A risk management tool that would be more 
efficient, more cost effective, more responsible, and more accountable. 
A program that encourages farmers to try new and innovative crops. And 
a reliable system that moves us away from the annual ad hoc disaster 
band-aids. I would like to extend a personal thank you to Ken Ackerman 
and his agency for listening to our concerns and helping draft them 
into this legislation.
  Today, I am optimistic that we in the Senate are soon to make those 
goals a reality. The $6 billion legislative package before us today 
will amend the Federal Crop Insurance program in several specific ways. 
The measure will:
  Make crop insurance more affordable and broaden coverage to encourage 
producers to purchase the highest levels of coverage;
  Create more realistic production history so that produces won't be 
penalized for losses over several years;
  Encourage producers to plant new specialty crops;
  Require producer input on the federal crop insurance program board of 
directors to ensure that the program works for the people who are 
buying the insurance product; and
  Make it easier for producers to get disaster assistance for crops 
that have no production history.
  I would like to highlight one particular section in this bill--that 
is the provision that at long last addresses the fact that during 
previous farm programs, Montana specialty crop producers have had 
little or no safety net. This is important since traditional crop 
prices have collapsed and farmers have ventured into specialty markets 
to survive. But because they have little or no production history, they 
are not eligible for traditional crop insurance coverage. Instead they 
are subject to the Non-Insured Agriculture Program.
  Unfortunately, the NAP program does not work. I have been told that 
in order for a farmer to be indemnified, she must be a ``very lucky 
person.'' A loss suffered per se does not trigger payments. Instead, at 
least five other producers in a defined 320,000 acre area must also 
suffer severe losses in order to trigger NAP coverage. Clearly, unless 
all the pieces fall together in a perfect puzzle, it is likely that the 
producer will not be paid.
  Last year, I offered legislation that will help Montana farmers try 
new and innovative crops by streamlining the NAP. Among other 
provisions, our proposal eliminates the area trigger. That way if 
disaster strikes, the producer will be covered. Plain and simple. 
Senator Larry Craig joined me in that effort, and I am pleased that our 
legislation is included in the Senate bill that we are currently 
considering.
  Folks at home want to farm. They can not control the weather, but 
they should be able to invest in a program that helps them manage 
nature's unpredictable whims. With an improved crop insurance program, 
Montana farmers will be able to diversify, take risks and move beyond 
our traditional way of thinking.
  We have before us the perfect opportunity to do what is right for 
Montana and rest of rural America--pass comprehensive crop insurance 
reform. I thank everyone who contributed to this effort and look 
forward to passage in the Senate, a successful conference and President 
signing the bill into law in the very near future.
  Mr. JOHNSON. Mr. President, I am extremely pleased to support 
legislation on the Senate floor today that improves and expands the 
crop insurance and risk management tools available to farmers in the 
United States. After months of uncertainty on this issue it is my hope 
that farmers desiring enhanced crop insurance and risk management 
options will be reassured that Congress will take a positive step and 
enact reform this year.
  Beyond the day-to-day uncertainties facing family farmers and 
ranchers, matters are complicated today by current economic conditions 
in rural America. Collapsed crop and livestock prices, weak export 
demand, and agribusiness concentration continue to threaten the 
viability of our independent family farmers and ranchers. Crop 
insurance provides many agricultural producers with a risk management 
tool, but Congress needs to reform the current program at this time to 
avoid allowing both low prices and an inadequate safety net to force 
farmers out of business.
  Nonetheless, I must caution that no matter how well crop insurance is 
improved, it is not a substitute for a sound farm policy or safety net. 
Instead, crop insurance is an important part of that farm safety net. 
It is my desire to also participate in a farm bill debate this year so 
Congress can reform the underlying farm bill. But, we must take 
advantage of this day to act on crop insurance.
  In 1994, I chaired the House of Representatives subcommittee charged 
with reforming crop insurance. At the time one of our goals was to 
improve insurance to a point where the government would not need to 
develop ad hoc disaster programs. Ad hoc disaster programs are 
difficult to create, difficult to administer, and are politically 
unpopular. While I am pleased with many of the reforms we made in 1994, 
action in Congress to pass crop loss disaster programs in the last two 
years reminds us that crop insurance has not fully replaced the need 
for ad hoc disasters.
  Crop insurance is critical to the farmers of South Dakota. Nearly 
twenty South Dakota grown crops are currently eligible for crop 
insurance, and among our major commodities, participation in the crop 
insurance program is high. Ninety-five percent of our corn acreage is 
enrolled in crop insurance while 92 percent of our soybean acres are in 
this program. Wheat producers in South Dakota place 76 percent of their 
acreage in crop insurance. After the reforms made to the program in 
1994, over 10 million acres of farmland in my state have been enrolled 
in crop insurance.
  I am pleased to co-sponsor a bipartisan reform bill that is a 
modification of S. 1580, the Kerrey-Roberts Crop Insurance for the 21st 
Century Act. Our bill clearly recognizes improved crop insurance is 
absolutely necessary for farmers in the future. Our underlying bill 
closely mirrors the crop insurance reform bill enacted in the House of 
Representatives last year. Finally, our bill addresses some of the most 
serious concerns of the current crop insurance program; affordability, 
dependability, and flexibility.
  The major reform proposed in our bill ensures greater affordability 
for farmers, especially for higher levels of protection. Nearly every 
farmer I talk to wants the opportunity to purchase higher levels of 
coverage, but most have found that a threshold exists were buy-up 
coverage becomes cost prohibitive. The Kerrey/Roberts bill makes 
coverage more affordable by providing higher subsidies for higher 
levels of coverage. South Dakota farmers support this provision of our 
bill because affordability seems to be the most pressing issue facing 
crop insurance today.
  In recent years, the issue of coverage dependability has come into 
serious question. Farmers in South Dakota and elsewhere have suffered 
under multiple years of weather related disasters.
  The bill I support ensures greater coverage dependability by 
providing relief for producers suffering from insurance coverage 
decreases and premium increases due to multi-year crop losses resulting 
from natural disasters. The bill adjusts actual production yield 
history--APH--for farmers by allowing producers who have suffered under 
three natural disasters in five years to drop their lowest APH. It also 
provides APH credit to assist beginning farmers and those who are 
diversifying with new crop rotations.
  Finally, the proposal I support authorizes the development of cost of 
production crop insurance policies. This should eventually be a new, 
useful tool for producers. It also provides livestock producers hope 
that the development of some type of livestock coverage is a priority. 
Livestock producers are the major contributor to South Dakota's 
agricultural economy, and risk management options are essential for 
these producers.
  However, our proposal, S. 2251, differs somewhat from our underlying 
bill, S. 1580, as well. Months of debate between members of the Senate 
Agriculture Committee has resulted in a certain degree of compromise on 
the overall issue of crop insurance and risk management. Some in our 
Committee believe a lump sum risk management payment

[[Page S1582]]

is preferred by farmers in parts of the United Sates. While I am very 
concerned that a de-coupled, lump sum payment is the wrong approach to 
take for several reasons, I understand the need to have comity and 
reasonable compromise in the Senate. Therefore, our proposal includes a 
pilot project to give farmers a choice between either crop insurance 
coverage or a risk management payment on a commodity by commodity 
basis. Yet, there are differences between the two risk management pilot 
programs offered by our coalition and those supporting large direct 
lump sum payments.
  I am concerned the de-coupled payment alternative offered by others 
of the Committee is flawed. First, dividing a limited amount of money 
among many producers with a risk management payment fails to ensure the 
need for ad hoc disaster programs is eliminated. These direct lump sum 
payments will also be capitalized in land values and make it difficult 
for small and beginning farmers to compete for land.
  Moreover, the alternative bill pushed by others in the Committee 
allows ``double dipping'' of benefits which I oppose. Those who choose 
a risk management payment are then also eligible for crop insurance 
under the current premium subsidy structure in the alternative 
supported by others today. This leads to a problem of complexity in 
terms of administration because crop insurance agents would be required 
to be able to quote two sets of premium rates available for farmers.
  Nonetheless, members of the Senate have every right to propose risk 
management alternatives that they believe suit the interests of the 
farmers they represent. So with caution, I understand the need to offer 
a compromise bill with my colleagues on the floor today that offers 
some degree of ``choice'' and compromise. So, while the bill I support 
today also includes a risk management payment choice, it requires a 
more rigorous set of conditions through certification and random 
auditing to ensure program compliance. Therefore I believe the risk 
management payment in our approach is more responsible. That said, I 
would be remiss if I did not state, unequivocally, that I deeply 
appreciate the chairman's leadership in the Senate Agriculture 
Committee, and I respect the fashion in which he allowed the mark-up 
hearing to take place on March 2.
  I want to mention one final issue very critical to the overall 
acceptance and viability of a taxpayer funded program like crop 
insurance. The issue of potential abuse in the insurance program was 
discussed in Congressional hearings on crop insurance reform last year. 
I do not believe fraud or abuse is of epidemic proportion in the crop 
insurance program. In fact, I believe the lion's share of interests 
(farmers, agents, loss adjusters, industry, and government) working in 
and around federal crop insurance are doing so with the highest degree 
of integrity. However, I am cognizant that questionable claims and 
potential abuse were of great concern last year. That said, unless 
steps are taken to bolster compliance and oversight the public support 
for this vital program may diminish.
  I am pleased to learn that earlier this month the risk Management 
Agency announced a major commitment to work with the private insurance 
industry to strengthen the integrity of crop insurance. I am hopeful 
this joint effort begins to end the concerns of this important program. 
I commend those involved in taking this positive step.
  Mr. LUGAR. Mr. President, I ask unanimous consent that the vote in 
relation to the pending amendment No. 2888 occur at 11 a.m. Thursday 
morning, with 2 minutes equally divided for closing remarks prior to 
the vote. I further ask consent that following that vote the bill be 
read the third time, under the previous consent, and the Senate proceed 
to vote on passage of H.R. 2559, the crop insurance risk management 
bill, as amended, with no intervening action or debate.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________