[Congressional Record Volume 148, Number 52 (Wednesday, May 1, 2002)]
[House]
[Pages H1795-H1978]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




CONFERENCE REPORT ON H.R. 2646, FARM SECURITY AND RURAL INVESTMENT ACT 
                                OF 2002

  Mr. Combest submitted the following conference report and statement 
on the bill (H.R. 2646) to provide for the continuation of agricultural 
programs through fiscal year 2011.

                  Conference Report (H. Rept. 107-424)

       The committee of conference on the disagreeing votes of the 
     two Houses on the amendments of the Senate to the bill (H.R. 
     2646), to provide for the continuation of agricultural 
     programs through fiscal year 2011, having met, after full and 
     free conference, have agreed to recommend and do recommend to 
     their respective Houses as follows:
       That the House recede from its disagreement to the 
     amendment of the Senate to the text of the bill and agree to 
     the same with an amendment as follows:
       In lieu of the matter proposed to be inserted by the Senate 
     amendment, insert the following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Farm 
     Security and Rural Investment Act of 2002''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:
Sec. 1. Short title; table of contents.

                      TITLE I--COMMODITY PROGRAMS

Sec. 1001. Definitions.

       Subtitle A--Direct Payments and Counter-Cyclical Payments

Sec. 1101. Establishment of base acres and payment acres for a farm.
Sec. 1102. Establishment of payment yield.
Sec. 1103. Availability of direct payments.
Sec. 1104. Availability of counter-cyclical payments.
Sec. 1105. Producer agreement required as condition of provision of 
              direct payments and counter-cyclical payments.

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Sec. 1106. Planting flexibility.
Sec. 1107. Relation to remaining payment authority under production 
              flexibility contracts.
Sec. 1108. Period of effectiveness.

  Subtitle B--Marketing Assistance Loans and Loan Deficiency Payments

Sec. 1201. Availability of nonrecourse marketing assistance loans for 
              loan commodities.
Sec. 1202. Loan rates for nonrecourse marketing assistance loans.
Sec. 1203. Term of loans.
Sec. 1204. Repayment of loans.
Sec. 1205. Loan deficiency payments.
Sec. 1206. Payments in lieu of loan deficiency payments for grazed 
              acreage.
Sec. 1207. Special marketing loan provisions for upland cotton.
Sec. 1208. Special competitive provisions for extra long staple cotton.
Sec. 1209. Availability of recourse loans for high moisture feed grains 
              and seed cotton.

                          Subtitle C--Peanuts

Sec. 1301. Definitions.
Sec. 1302. Establishment of payment yield and base acres for peanuts 
              for a farm.
Sec. 1303. Availability of direct payments for peanuts.
Sec. 1304. Availability of counter-cyclical payments for peanuts.
Sec. 1305. Producer agreement required as condition on provision of 
              direct payments and counter-cyclical payments.
Sec. 1306. Planting flexibility.
Sec. 1307. Marketing assistance loans and loan deficiency payments for 
              peanuts.
Sec. 1308. Miscellaneous provisions.
Sec. 1309. Termination of marketing quota programs for peanuts and 
              compensation to peanut quota holders for loss of quota 
              asset value.
Sec. 1310. Repeal of superseded price support authority and effect of 
              repeal.

                           Subtitle D--Sugar

Sec. 1401. Sugar program.
Sec. 1402. Storage facility loans.
Sec. 1403. Flexible marketing allotments for sugar.

                           Subtitle E--Dairy

Sec. 1501. Milk price support program.
Sec. 1502. National dairy market loss payments.
Sec. 1503. Dairy export incentive and dairy indemnity programs.
Sec. 1504. Dairy product mandatory reporting.
Sec. 1505. Funding of dairy promotion and research program.
Sec. 1506. Fluid milk promotion.
Sec. 1507. Study of national dairy policy.
Sec. 1508. Studies of effects of changes in approach to national dairy 
              policy and fluid milk identity standards.

                       Subtitle F--Administration

Sec. 1601. Administration generally.
Sec. 1602. Suspension of permanent price support authority.
Sec. 1603. Payment limitations.
Sec. 1604. Adjusted gross income limitation.
Sec. 1605. Commission on application of payment limitations.
Sec. 1606. Adjustments of loans.
Sec. 1607. Personal liability of producers for deficiencies.
Sec. 1608. Extension of existing administrative authority regarding 
              loans.
Sec. 1609. Commodity Credit Corporation Inventory.
Sec. 1610. Reserve stock level.
Sec. 1611. Farm reconstitutions.
Sec. 1612. Assignment of payments.
Sec. 1613. Equitable relief from ineligibility for loans, payments, or 
              other benefits.
Sec. 1614. Tracking of benefits.
Sec. 1615. Estimates of net farm income.
Sec. 1616. Availability of incentive payments for certain producers.
Sec. 1617. Renewed availability of market loss assistance and certain 
              emergency assistance to persons that failed to receive 
              assistance under earlier authorities.
Sec. 1618. Producer retention of erroneously paid loan deficiency 
              payments and marketing loan gains.

                         TITLE II--CONSERVATION

                   Subtitle A--Conservation Security

Sec. 2001. Conservation security program.
Sec. 2002. Conservation compliance.
Sec. 2003. Partnerships and cooperation.
Sec. 2004. Administrative requirements for conservation programs.
Sec. 2005. Reform and assessment of conservation programs.
Sec. 2006. Conforming amendments.

                    Subtitle B--Conservation Reserve

Sec. 2101. Conservation reserve program.

                  Subtitle C--Wetlands Reserve Program

Sec. 2201. Reauthorization.
Sec. 2202. Enrollment.
Sec. 2203. Easements and agreements.
Sec. 2204. Changes in ownership; agreement modification; termination.

              Subtitle D--Environmental Quality Incentives

Sec. 2301. Environmental quality incentives program.

                     Subtitle E--Grassland Reserve

Sec. 2401. Grassland reserve program.

                Subtitle F--Other Conservation Programs

Sec. 2501. Agricultural management assistance.
Sec. 2502. Grazing, wildlife habitat incentive, source water 
              protection, and Great Lakes basin programs.
Sec. 2503. Farmland protection program.
Sec. 2504. Resource conservation and development program.
Sec. 2505. Small watershed rehabilitation program.
Sec. 2506. Use of symbols, slogans, and logos.
Sec. 2507. Desert terminal lakes.

        Subtitle G--Conservation Corridor Demonstration Program

Sec. 2601. Definitions.
Sec. 2602. Conservation corridor demonstration program.
Sec. 2603. Implementation of conservation corridor plan.
Sec. 2604. Funding requirements.

                 Subtitle H--Funding and Administration

Sec. 2701. Funding and administration.
Sec. 2702. Regulations.

                            TITLE III--TRADE

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

Sec. 3001. United States policy. 
Sec. 3002. Provision of agricultural commodities. 
Sec. 3003. Generation and use of currencies by private voluntary 
              organizations and cooperatives. 
Sec. 3004. Levels of assistance. 
Sec. 3005. Food Aid Consultative Group. 
Sec. 3006. Maximum level of expenditures. 
Sec. 3007. Administration. 
Sec. 3008. Assistance for stockpiling and rapid transportation, 
              delivery, and distribution of shelf-stable prepackaged 
              foods. 
Sec. 3009. Sale procedure. 
Sec. 3010. Prepositioning. 
Sec. 3011. Transportation and related costs. 
Sec. 3012. Expiration date.
Sec. 3013. Micronutrient fortification programs. 
Sec. 3014. John Ogonowski Farmer-to-Farmer Program. 

               Subtitle B--Agricultural Trade Act of 1978

Sec. 3101. Exporter assistance initiative. 
Sec. 3102. Export credit guarantee program. 
Sec. 3103. Market access program. 
Sec. 3104. Export enhancement program. 
Sec. 3105. Foreign market development cooperator program. 
Sec. 3106. Food for progress. 
Sec. 3107. McGovern-Dole International Food for Education and Child 
              Nutrition Program. 

                       Subtitle C--Miscellaneous

Sec. 3201. Surplus commodities for developing or friendly countries. 
Sec. 3202. Bill Emerson Humanitarian Trust Act. 
Sec. 3203. Emerging markets. 
Sec. 3204. Biotechnology and agricultural trade program. 
Sec. 3205. Technical assistance for specialty crops.
Sec. 3206. Global market strategy. 
Sec. 3207. Report on use of perishable commodities and live animals. 
Sec. 3208. Study on fee for services. 
Sec. 3209. Sense of Congress concerning foreign assistance programs. 
Sec. 3210. Sense of the Senate concerning agricultural trade. 

                      TITLE IV--NUTRITION PROGRAMS

Sec. 4001. Short title.

                     Subtitle A--Food Stamp Program

Sec. 4101. Encouragement of payment of child support.
Sec. 4102. Simplified definition of income.
Sec. 4103. Standard deduction.
Sec. 4104. Simplified utility allowance.
Sec. 4105. Simplified determination of housing costs.
Sec. 4106. Simplified determination of deductions.
Sec. 4107. Simplified definition of resources.
Sec. 4108. Alternative issuance systems in disasters.
Sec. 4109. State option to reduce reporting requirements.
Sec. 4110. Cost neutrality for electronic benefit transfer systems.
Sec. 4111. Report on electronic benefit transfer systems.
Sec. 4112. Alternative procedures for residents of certain group 
              facilities.
Sec. 4113. Redemption of benefits through group living arrangements.
Sec. 4114. Availability of food stamp program applications on the 
              Internet.
Sec. 4115. Transitional food stamps for families moving from welfare.
Sec. 4116. Grants for simple application and eligibility determination 
              systems and improved access to benefits.
Sec. 4117. Delivery to retailers of notices of adverse action.
Sec. 4118. Reform of quality control system.
Sec. 4119. Improvement of calculation of State performance measures.
Sec. 4120. Bonuses for States that demonstrate high or most improved 
              performance.
Sec. 4121. Employment and training program.
Sec. 4122. Reauthorization of food stamp program and food distribution 
              program on Indian reservations.
Sec. 4123. Expanded grant authority.
Sec. 4124. Consolidated block grants for Puerto Rico and American 
              Samoa.
Sec. 4125. Assistance for community food projects.
Sec. 4126. Availability of commodities for the emergency food 
              assistance program.

                   Subtitle B--Commodity Distribution

Sec. 4201. Commodity supplemental food program.
Sec. 4202. Commodity donations.

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Sec. 4203. Distribution of surplus commodities to special nutrition 
              projects.
Sec. 4204. Emergency food assistance.

            Subtitle C--Child Nutrition and Related Programs

Sec. 4301. Commodities for school lunch program.
Sec. 4302. Eligibility for free and reduced price meals.
Sec. 4303. Purchases of locally produced foods.
Sec. 4304. Applicability of Buy-American requirement to Puerto Rico.
Sec. 4305. Fruit and vegetable pilot program.
Sec. 4306. Eligibility for assistance under the special supplemental 
              nutrition program for women, infants, and children.
Sec. 4307. WIC farmers' market nutrition program.

                       Subtitle D--Miscellaneous

Sec. 4401. Partial restoration of benefits to legal immigrants.
Sec. 4402. Seniors farmers' market nutrition program.
Sec. 4403. Nutrition information and awareness pilot program.
Sec. 4404. Hunger fellowship program.
Sec. 4405. General effective date.

                            TITLE V--CREDIT

                    Subtitle A--Farm Ownership Loans

Sec. 5001. Direct loans.
Sec. 5002. Financing of bridge loans.
Sec. 5003. Amount of guarantee of loans for farm operations on tribal 
              lands.
Sec. 5004. Guarantee of loans made under State beginning farmer or 
              rancher programs.
Sec. 5005. Down Payment Loan Program.
Sec. 5006. Beginning farmer and rancher contract land sales program.

                      Subtitle B--Operating Loans

Sec. 5101. Direct loans.
Sec. 5102. Suspension of limitation on period for which borrowers are 
              eligible for guaranteed assistance.

                      Subtitle C--Emergency Loans

Sec. 5201. Emergency loans in response to an emergency resulting from 
              quarantines.

                 Subtitle D--Administrative Provisions

Sec. 5301. Evaluations of direct and guaranteed loan programs.
Sec. 5302. Eligibility of trusts and limited liability companies for 
              farm ownership loans, farm operating loans, and emergency 
              loans.
Sec. 5303. Debt settlement.
Sec. 5304. Temporary authority to enter into contracts; private 
              collection agencies.
Sec. 5305. Interest rate options for loans in servicing.
Sec. 5306. Elimination of requirement that Secretary require county 
              committees to certify in writing that certain loan 
              reviews have been conducted.
Sec. 5307. Simplified loan guarantee application available for loans of 
              greater amounts.
Sec. 5308. Inventory property.
Sec. 5309. Administration of certified lenders and preferred certified 
              lenders programs.
Sec. 5310. Definitions.
Sec. 5311. Loan authorization levels.
Sec. 5312. Reservation of funds for direct operating loans for 
              beginning farmers and ranchers.
Sec. 5313. Interest rate reduction program.
Sec. 5314. Reamortization of recapture payments.
Sec. 5315. Allocation of certain funds for socially disadvantaged 
              farmers and ranchers.
Sec. 5316. Waiver of borrower training certification requirement.
Sec. 5317. Timing of loan assessments.
Sec. 5318. Annual review of borrowers.
Sec. 5319. Loan eligibility for borrowers with prior debt forgiveness.
Sec. 5320. Making and servicing of loans by personnel of State, county, 
              or area committees.
Sec. 5321. Eligibility of employees of State, county, or area committee 
              for loans and loan guarantees.

                        Subtitle E--Farm Credit

Sec. 5401. Repeal of burdensome approval requirements.
Sec. 5402. Banks for cooperatives.
Sec. 5403. Insurance corporation premiums.

                     Subtitle F--General Provisions

Sec. 5501. Technical amendments.

                      TITLE VI--RURAL DEVELOPMENT

        Subtitle A--Consolidated Farm and Rural Development Act

Sec. 6001. Eligibility of rural empowerment zones and rural enterprise 
              communities for direct and guaranteed loans for essential 
              community facilities. 
Sec. 6002. Water or waste disposal grants. 
Sec. 6003. Rural business opportunity grants. 
Sec. 6004. Child day care facilities. 
Sec. 6005. Rural water and wastewater circuit rider program. 
Sec. 6006. Multijurisdictional regional planning organizations. 
Sec. 6007. Loan guarantees for certain rural development loans. 
Sec. 6008. Tribal college and university essential community 
              facilities. 
Sec. 6009. Emergency and imminent community water assistance grant 
              program. 
Sec. 6010. Water and waste facility grants for Native American tribes. 
Sec. 6011. Grants for water systems for rural and native villages in 
              Alaska. 
Sec. 6012. Grants to nonprofit organizations to finance the 
              construction, refurbishing, and servicing of 
              individually-owned household water well systems in rural 
              areas for individuals with low or moderate incomes. 
Sec. 6013. Loans and loan guarantees for renewable energy systems. 
Sec. 6014. Rural business enterprise grants. 
Sec. 6015. Rural cooperative development grants. 
Sec. 6016. Grants to broadcasting systems. 
Sec. 6017. Business and industry loan modifications. 
Sec. 6018. Use of rural development loans and grants for other 
              purposes. 
Sec. 6019. Simplified application forms for loan guarantees. 
Sec. 6020. Definition of rural and rural area. 
Sec. 6021. National Rural Development Partnership. 
Sec. 6022. Rural telework. 
Sec. 6023. Historic barn preservation. 
Sec. 6024. Grants for NOAA weather radio transmitters. 
Sec. 6025. Grants to train farm workers in new technologies and to 
              train farm workers in specialized skills necessary for 
              higher value crops. 
Sec. 6026. Rural community advancement program. 
Sec. 6027. Delta Regional Authority. 
Sec. 6028. Northern Great Plains Regional Authority. 
Sec. 6029. Rural business investment program. 
Sec. 6030. Rural strategic investment program. 
Sec. 6031. Funding of pending rural development loan and grant 
              applications. 

             Subtitle B--Rural Electrification Act of 1936

Sec. 6101. Guarantees for bonds and notes issued for electrification or 
              telephone purposes. 
Sec. 6102. Expansion of 911 access. 
Sec. 6103. Enhancement of access to broadband service in rural areas. 

   Subtitle C--Food, Agriculture, Conservation, and Trade Act of 1990

Sec. 6201. Alternative Agricultural Research and Commercialization 
              Corporation. 
Sec. 6202. Rural electronic commerce extension program. 
Sec. 6203. Telemedicine and distance learning services in rural areas. 

            Subtitle D--SEARCH Grants for Small Communities

Sec. 6301. Definitions.
Sec. 6302. SEARCH grant program.
Sec. 6303. Report.
Sec. 6304. Funding.

                       Subtitle E--Miscellaneous

Sec. 6401. Value-added agricultural product market development grants. 
Sec. 6402. Agriculture innovation center demonstration program. 
Sec. 6403. Fund for Rural America. 
Sec. 6404. Rural local television broadcast signal loan guarantees. 
Sec. 6405. Rural firefighters and emergency personnel grant program. 
Sec. 6406. Sense of Congress on rural policy coordination. 

                TITLE VII--RESEARCH AND RELATED MATTERS

                         Subtitle A--Extensions

Sec. 7101. National rural information center clearinghouse.
Sec. 7102. Grants and fellowships for food and agricultural sciences 
              education.
Sec. 7103. Policy research centers.
Sec. 7104. Human nutrition intervention and health promotion research 
              program.
Sec. 7105. Pilot research program to combine medical and agricultural 
              research.
Sec. 7106. Nutrition education program.
Sec. 7107. Continuing animal health and disease research programs.
Sec. 7108. Appropriations for research on national or regional 
              problems.
Sec. 7109. Grants to upgrade agricultural and food sciences facilities 
              at 1890 land-grant colleges, including Tuskegee 
              University.
Sec. 7110. National research and training virtual centers.
Sec. 7111. Hispanic-serving institutions.
Sec. 7112. Competitive grants for international agricultural science 
              and education programs.
Sec. 7113. University research.
Sec. 7114. Extension service.
Sec. 7115. Supplemental and alternative crops.
Sec. 7116. Aquaculture research facilities.
Sec. 7117. Rangeland research.
Sec. 7118. National genetics resources program.
Sec. 7119. High-priority research and extension initiatives.
Sec. 7120. Nutrient management research and extension initiative.
Sec. 7121. Agricultural telecommunications program.
Sec. 7122. Assistive technology program for farmers with disabilities.
Sec. 7123. Partnerships for high-value agricultural product quality 
              research.
Sec. 7124. Biobased products.
Sec. 7125. Integrated research, education, and extension competitive 
              grants program.
Sec. 7126. Equity in Educational Land-Grant Status Act of 1994.
Sec. 7127. 1994 Institution research grants.
Sec. 7128. Endowment for 1994 Institutions.
Sec. 7129. Precision agriculture.
Sec. 7130. Thomas Jefferson Initiative for crop diversification.

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Sec. 7131. Support for research regarding diseases of wheat, triticale, 
              and barley caused by fusarium graminearum or by tilletia 
              indica.
Sec. 7132. Office of Pest Management Policy.
Sec. 7133. National Agricultural Research, Extension, Education, and 
              Economics Advisory Board.
Sec. 7134. Grants for research on production and marketing of alcohols 
              and industrial hydrocarbons from agricultural commodities 
              and forest products.
Sec. 7135. Agricultural experiment stations research facilities.
Sec. 7136. Competitive, special, and facilities research grants 
              national research initiative.
Sec. 7137. Federal agricultural research facilities authorization of 
              appropriations.
Sec. 7138. Critical agricultural materials research.
Sec. 7139. Aquaculture.

                       Subtitle B--Modifications

Sec. 7201. Equity in Educational Land-Grant Status Act of 1994.
Sec. 7202. Carryover for experiment stations.
Sec. 7203. Authorization percentages for research and extension formula 
              funds.
Sec. 7204. Carryover for eligible institutions.
Sec. 7205. Initiative for future agriculture and food systems.
Sec. 7206. Eligibility for integrated grants program.
Sec. 7207. Agricultural Research, Extension, and Education Reform Act 
              of 1998.
Sec. 7208. Food, Agriculture, Conservation, and Trade Act of 1990.
Sec. 7209. National Agricultural Research, Extension, and Teaching 
              Policy Act of 1977.
Sec. 7210. Biotechnology risk assessment research.
Sec. 7211. Competitive, special, and facilities research grants.
Sec. 7212. Matching funds requirement for research and extension 
              activities of 1890 Institutions.
Sec. 7213. Matching requirements for research and extension formula 
              funds for insular area land-grant institutions.
Sec. 7214. Definition of food and agricultural sciences.
Sec. 7215. Federal Extension Service.
Sec. 7216. Policy research centers.
Sec. 7217. Availability of competitive grant funds.
Sec. 7218. Organic agriculture research and extension initiative.
Sec. 7219. Senior scientific research service.
Sec. 7220. Termination of certain schedule a appointments.
Sec. 7221. Biosecurity planning and response programs.
Sec. 7222. Indirect costs for small business innovation research 
              grants.
Sec. 7223. Carbon cycle research.

        Subtitle C--Repeal of Certain Activities and Authorities

Sec. 7301. Food Safety Research Information Office and National 
              Conference.
Sec. 7302. Reimbursement of expenses under Sheep Promotion, Research, 
              and Information Act of 1994.
Sec. 7303. Market expansion research.
Sec. 7304. National Advisory Board on Agricultural Weather.
Sec. 7305. Agricultural information exchange with Ireland.
Sec. 7306. Pesticide resistance study.
Sec. 7307. Expansion of education study.
Sec. 7308. Task force on 10-year strategic plan for agricultural 
              research facilities.

                      Subtitle D--New Authorities

Sec. 7401. Subtitle definitions.
Sec. 7402. Research equipment grants.
Sec. 7403. Joint requests for proposals.
Sec. 7404. Review of Agricultural Research Service.
Sec. 7405. Beginning farmer and rancher development program.
Sec. 7406. Sense of Congress regarding doubling of funding for 
              agricultural research.
Sec. 7407. Organic production and market data initiatives.
Sec. 7408. International organic research collaboration.
Sec. 7409. Report on producers and handlers of organic agricultural 
              products.
Sec. 7410. Report on genetically modified pest-protected plants.
Sec. 7411. Study of nutrient banking.
Sec. 7412. Grants for youth organizations.

                       Subtitle E--Miscellaneous

Sec. 7501. Resident instruction and distance education at institutions 
              of higher education in United States insular areas.
Sec. 7502. Definitions.
Sec. 7503. Resident instruction and distance education grants program 
              for insular area institutions of higher education.
Sec. 7504. Declaration of extraordinary emergency and resulting 
              authorities.
Sec. 7505. Agricultural biotechnology research and development for 
              developing countries.
Sec. 7506. Land acquisition authority, national peanut research 
              laboratory, Dawson, Georgia.

                          TITLE VIII--FORESTRY

        Subtitle A--Cooperative Forestry Assistance Act of 1978

Sec. 8001. Repeal of forestry incentives program and stewardship 
              incentive program.
Sec. 8002. Establishment of forest land enhancement program.
Sec. 8003. Enhanced community fire protection.

                  Subtitle B--Amendments to Other Laws

Sec. 8101. Sustainable forestry outreach initiative; renewable 
              resources extension activities.
Sec. 8102. Office of International Forestry.

                  Subtitle C--Miscellaneous Provisions

Sec. 8201. McIntire-Stennis cooperative forestry research program.

                            TITLE IX--ENERGY

Sec. 9001. Definitions. 
Sec. 9002. Federal procurement of biobased products. 
Sec. 9003. Biorefinery development grants. 
Sec. 9004. Biodiesel fuel education program. 
Sec. 9005. Energy audit and renewable energy development program. 
Sec. 9006. Renewable energy systems and energy efficiency improvements. 

Sec. 9007. Hydrogen and fuel cell technologies. 
Sec. 9008. Biomass research and development. 
Sec. 9009. Cooperative research and extension projects. 
Sec. 9010. Continuation of bioenergy program. 

                         TITLE X--MISCELLANEOUS

                       Subtitle A--Crop Insurance

Sec. 10001. Equal crop insurance treatment of potatoes and sweet 
              potatoes.
Sec. 10002. Continuous coverage.
Sec. 10003. Quality loss adjustment procedures.
Sec. 10004. Adjusted gross revenue insurance pilot program.
Sec. 10005. Sense of Congress on expansion of crop insurance coverage.
Sec. 10006. Report on specialty crop insurance.

                    Subtitle B--Disaster Assistance

Sec. 10101. Reference to sea grass and sea oats as crops covered by 
              noninsured crop disaster assistance program.
Sec. 10102. Emergency grants to assist low-income migrant and seasonal 
              farmworkers.
Sec. 10103. Emergency loans for seed producers.
Sec. 10104. Assistance for livestock producers.
Sec. 10105. Market loss assistance for apple producers.
Sec. 10106. Market loss assistance for onion producers.
Sec. 10107. Commercial fisheries failure.
Sec. 10108. Study of feasibility of producer indemnification from 
              Government-caused disasters.

                  Subtitle C--Tree Assistance Program

Sec. 10201. Definitions.
Sec. 10202. Eligibility.
Sec. 10203. Assistance.
Sec. 10204. Limitations on assistance.
Sec. 10205. Authorization of appropriations.

                       Subtitle D--Animal Welfare

Sec. 10301. Definition of animal under the Animal Welfare Act.
Sec. 10302. Prohibition on interstate movement of animals for animal 
              fighting.
Sec. 10303. Penalties and foreign commerce provisions of the Animal 
              Welfare Act.
Sec. 10304. Report on rats, mice, and birds.
Sec. 10305. Enforcement of Humane Methods of Slaughter Act of 1958.

                  Subtitle E--Animal Health Protection

Sec. 10401. Short title.
Sec. 10402. Findings.
Sec. 10403. Definitions.
Sec. 10404. Restriction on importation or entry.
Sec. 10405. Exportation.
Sec. 10406. Interstate movement.
Sec. 10407. Seizure, quarantine, and disposal.
Sec. 10408. Inspections, seizures, and warrants.
Sec. 10409. Detection, control, and eradication of diseases and pests.
Sec. 10410. Veterinary accreditation program.
Sec. 10411. Cooperation.
Sec. 10412. Reimbursable agreements.
Sec. 10413. Administration and claims.
Sec. 10414. Penalties.
Sec. 10415. Enforcement.
Sec. 10416. Regulations and orders.
Sec. 10417. Authorization of appropriations.
Sec. 10418. Repeals and conforming amendments.

                         Subtitle F--Livestock

Sec. 10501. Transportation of poultry and other animals.
Sec. 10502. Swine contractors.
Sec. 10503. Right to discuss terms of contract.
Sec. 10504. Veterinary training.
Sec. 10505. Pseudorabies eradication program.

                      Subtitle G--Specialty Crops

Sec. 10601. Marketing orders for caneberries.
Sec. 10602. Availability of section 32 funds.
Sec. 10603. Purchase of specialty crops.
Sec. 10604. Protection for purchasers of farm products.
Sec. 10605. Farmers' market promotion program.
Sec. 10606. National organic certification cost-share program.
Sec. 10607. Exemption of certified organic products from assessments.
Sec. 10608. Cranberry acreage reserve program.

                       Subtitle H--Administration

Sec. 10701. Initial rate of basic pay for employees of county 
              committees.
Sec. 10702. Commodity Futures Trading Commission pay comparability.
Sec. 10703. Overtime and holiday pay.
Sec. 10704. Assistant Secretary of Agriculture for Civil Rights.
Sec. 10705. Operation of Graduate School of Department of Agriculture.
Sec. 10706. Implementation funding and information management.
Sec. 10707. Outreach and assistance for socially disadvantaged farmers 
              and ranchers.
Sec. 10708. Transparency and accountability for socially disadvantaged 
              farmers and ranchers; public disclosure requirements for 
              county committee elections.

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                     Subtitle I--General Provisions

Sec. 10801. Cotton classification services.
Sec. 10802. Program of public education regarding use of biotechnology 
              in producing food for human consumption.
Sec. 10803. Chino Dairy Preserve Project.
Sec. 10804. Grazinglands Research Laboratory.
Sec. 10805. Food and Agricultural Policy Research Institute.
Sec. 10806. Market names for catfish and ginseng.
Sec. 10807. Food Safety Commission.
Sec. 10808. Pasteurization.
Sec. 10809. Rulemaking on labeling of irradiated food; certain 
              petitions.
Sec. 10810. Penalties for violations of Plant Protection Act.
Sec. 10811. Preclearance quarantine inspections.
Sec. 10812. Connecticut River Atlantic Salmon Commission.
Sec. 10813. Pine Point School.
Sec. 10814. 7-month extension of chapter 12 of title 11 of the United 
              States Code.
Sec. 10815. Practices involving nonambulatory livestock.
Sec. 10816. Country of origin labeling.

             Subtitle J--Miscellaneous Studies and Reports

Sec. 10901. Report on specialty crop purchases.
Sec. 10902. Report on pouched and canned salmon.
Sec. 10903. Study on updating yields.
Sec. 10904. Report on effect of farm program payments.
Sec. 10905. Chiloquin Dam fish passage feasibility study.
Sec. 10906. Report on geographically disadvantaged farmers and 
              ranchers.
Sec. 10907. Studies on agricultural research and technology.
Sec. 10908. Report on tobacco settlement agreement.
Sec. 10909. Report on sale and use of pesticides for agricultural uses.
Sec. 10910. Review of operation of agricultural and natural resource 
              programs on tribal trust land.
                      TITLE I--COMMODITY PROGRAMS

     SEC. 1001. DEFINITIONS.

       In this title (other than subtitle C):
       (1) Agricultural act of 1949.--The term ``Agricultural Act 
     of 1949'' means the Agricultural Act of 1949 (7 U.S.C. 1421 
     et seq.), as in effect prior to the suspensions under section 
     171 of the Federal Agriculture Improvement and Reform Act of 
     1996 (7 U.S.C. 7301).
       (2) Base acres.--The term ``base acres'', with respect to a 
     covered commodity on a farm, means the number of acres 
     established under section 1101 with respect to the covered 
     commodity on the election made by the owner of the farm under 
     subsection (a) of such section.
       (3) Counter-cyclical payment.--The term ``counter-cyclical 
     payment'' means a payment made to producers on a farm under 
     section 1104.
       (4) Covered commodity.--The term ``covered commodity'' 
     means wheat, corn, grain sorghum, barley, oats, upland 
     cotton, rice, soybeans, and other oilseeds.
       (5) Direct payment.--The term ``direct payment'' means a 
     payment made to producers on a farm under section 1103.
       (6) Effective price.--The term ``effective price'', with 
     respect to a covered commodity for a crop year, means the 
     price calculated by the Secretary under section 1104 to 
     determine whether counter-cyclical payments are required to 
     be made for that crop year.
       (7) Extra long staple cotton.--The term ``extra long staple 
     cotton'' means cotton that--
       (A) is produced from pure strain varieties of the 
     Barbadense species or any hybrid thereof, or other similar 
     types of extra long staple cotton, designated by the 
     Secretary, having characteristics needed for various end uses 
     for which United States upland cotton is not suitable and 
     grown in irrigated cotton-growing regions of the United 
     States designated by the Secretary or other areas designated 
     by the Secretary as suitable for the production of the 
     varieties or types; and
       (B) is ginned on a roller-type gin or, if authorized by the 
     Secretary, ginned on another type gin for experimental 
     purposes.
       (8) Loan commodity.--The term `loan commodity' means wheat, 
     corn, grain sorghum, barley, oats, upland cotton, extra long 
     staple cotton, rice, soybeans, other oilseeds, wool, mohair, 
     honey, dry peas, lentils, and small chickpeas.
       (9) Other oilseed.--The term ``other oilseed'' means a crop 
     of sunflower seed, rapeseed, canola, safflower, flaxseed, 
     mustard seed, or, if designated by the Secretary, another 
     oilseed.
       (10) Payment acres.--The term ``payment acres'' means 85 
     percent of the base acres of a covered commodity on a farm, 
     as established under section 1101, on which direct payments 
     and counter-cyclical payments are made.
       (11) Payment yield.--
       (A) In general.--The term ``payment yield'' means the yield 
     established under section 1102 for a farm for a covered 
     commodity.
       (B) Updated payment yield.--The term ``updated payment 
     yield'' means the payment yield elected by the owner of a 
     farm under section 1102(e) to be used in calculating the 
     counter-cyclical payments for the farm.
       (12) Producer.--The term ``producer'' means an owner, 
     operator, landlord, tenant, or sharecropper that shares in 
     the risk of producing a crop and is entitled to share in the 
     crop available for marketing from the farm, or would have 
     shared had the crop been produced. In determining whether a 
     grower of hybrid seed is a producer, the Secretary shall not 
     take into consideration the existence of a hybrid seed 
     contract and shall ensure that program requirements do not 
     adversely affect the ability of the grower to receive a 
     payment under this title.
       (13) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (14) State.--The term ``State'' means each of the several 
     States of the United States, the District of Columbia, the 
     Commonwealth of Puerto Rico, and any other territory or 
     possession of the United States.
       (15) Target price.--The term ``target price'' means the 
     price per bushel (or other appropriate unit in the case of 
     upland cotton, rice, and other oilseeds) of a covered 
     commodity used to determine the payment rate for counter-
     cyclical payments.
       (16) United states.--The term ``United States'', when used 
     in a geographical sense, means all of the States.
       Subtitle A--Direct Payments and Counter-Cyclical Payments

     SEC. 1101. ESTABLISHMENT OF BASE ACRES AND PAYMENT ACRES FOR 
                   A FARM.

       (a) Election by Owner of Base Acres Calculation Method.--
       (1) Alternative calculation methods.--For the purpose of 
     making direct payments and counter-cyclical payments with 
     respect to a farm, the Secretary shall give an owner of the 
     farm an opportunity to elect 1 of the following as the method 
     by which the base acres of all covered commodities on the 
     farm are to be determined:
       (A) Subject to paragraphs (3) and (4), the 4-year average 
     of the following:
       (i) Acreage planted on the farm to covered commodities for 
     harvest, grazing, haying, silage, or other similar purposes 
     for the 1998 through 2001 crop years.
       (ii) Any acreage on the farm that the producers were 
     prevented from planting during the 1998 through 2001 crop 
     years to covered commodities because of drought, flood, or 
     other natural disaster, or other condition beyond the control 
     of the producers, as determined by the Secretary.
       (B) Subject to paragraph (3), the sum of the following:
       (i) The contract acreage (as defined in section 102 of the 
     Federal Agriculture Improvement and Reform Act of 1996 (7 
     U.S.C. 7202)) used by the Secretary to calculate the fiscal 
     year 2002 payment authorized under section 114 of such Act (7 
     U.S.C. 7214) for the covered commodities on the farm.
       (ii) The 4-year average of eligible oilseed acreage on the 
     farm for the 1998 through 2001 crop years, as determined by 
     the Secretary under paragraph (2).
       (2) Eligible oilseed acreage.--
       (A) Calculation.--For purposes of paragraph (1)(B)(ii), the 
     eligible acreage for each oilseed on a farm during each of 
     the 1998 through 2001 crop years shall be determined in the 
     manner provided in paragraph (1)(A), except that the total 
     acreage for all oilseeds on the farm for a crop year may not 
     exceed the difference between--
       (i) the total acreage determined under paragraph (1)(A) for 
     all covered commodities for that crop year; and
       (ii) the total contract acreage determined under paragraph 
     (1)(B)(i).
       (B) Effect of negative number.--If the subtraction 
     performed under subparagraph (A) results in a negative 
     number, the eligible oilseed acreage on the farm for that 
     crop year shall be zero for purposes of determining the 4-
     year average.
       (C) Offset of contract acreage.--The owner of a farm may 
     increase the eligible acreage for an oilseed on the farm by 
     reducing the contract acreage determined under paragraph 
     (1)(B)(i) for 1 or more covered commodities on an acre-for-
     acre basis, except that the total base acreage for each 
     oilseed on the farm may not exceed the 4-year average of each 
     oilseed determined under paragraph (1)(B)(ii).
       (3) Inclusion of all 4 years in average.--For the purpose 
     of determining a 4-year acreage average under this subsection 
     for a farm, the Secretary shall not exclude any crop year in 
     which a covered commodity was not planted.
       (4) Treatment of multiple planting or prevented planting.--
     For the purpose of determining under paragraph (1)(A) the 
     acreage on a farm that producers planted or were prevented 
     from planting during the 1998 through 2001 crop years to 
     covered commodities, if the acreage that was planted or 
     prevented from being planted was devoted to another covered 
     commodity in the same crop year (other than a covered 
     commodity produced under an established practice of double 
     cropping), the owner may elect the commodity to be used for 
     that crop year in determining the 4-year average, but may not 
     include both the initial commodity and the subsequent 
     commodity.
       (b) Single Election; Time for Election.--
       (1) Notice of election opportunity.--As soon as practicable 
     after the date of enactment of this Act, the Secretary shall 
     provide notice to owners of farms regarding their 
     opportunity to make the election described in subsection 
     (a). The notice shall include the following:
       (A) Notice that the opportunity of an owner to make the 
     election is being provided only once.
       (B) Information regarding the manner in which the election 
     must be made and the time periods and manner in which notice 
     of the election must be submitted to the Secretary.
       (2) Election deadline.--Within the time period and in the 
     manner prescribed pursuant to paragraph (1), the owner of a 
     farm shall submit to the Secretary notice of the election 
     made by the owner under subsection (a).
       (c) Effect of Failure To Make Election.--If the owner of a 
     farm fails to make the election under subsection (a) or fails 
     to timely notify the Secretary of the election made, as 
     required by subsection (b), the owner shall be deemed to have 
     made the election described in subsection (a)(1)(B) to 
     determine base acres for all covered commodities on the farm.

[[Page H1800]]

       (d) Application of Election to All Covered Commodities.--
     The election made under subparagraph (A) or (B) of subsection 
     (a)(1), or deemed to be made under subsection (c), with 
     respect to a farm shall apply to all of the covered 
     commodities on the farm.
       (e) Treatment of Conservation Reserve Contract Acreage.--
       (1) In general.--The Secretary shall provide for an 
     adjustment, as appropriate, in the base acres for covered 
     commodities for a farm whenever either of the following 
     circumstances occurs:
       (A) A conservation reserve contract entered into under 
     section 1231 of the Food Security Act of 1985 (16 U.S.C. 
     3831) with respect to the farm expires or is voluntarily 
     terminated.
       (B) Cropland is released from coverage under a conservation 
     reserve contract by the Secretary.
       (2) Special payment rules.--For the crop year in which a 
     base acres adjustment under paragraph (1) is first made, the 
     owner of the farm shall elect to receive either direct 
     payments and counter-cyclical payments with respect to the 
     acreage added to the farm under this subsection or a prorated 
     payment under the conservation reserve contract, but not 
     both.
       (f) Payment Acres.--The payment acres for a covered 
     commodity on a farm shall be equal to 85 percent of the base 
     acres for the covered commodity.
       (g) Prevention of Excess Base Acres.--
       (1) Required reduction.--If the sum of the base acres for a 
     farm, together with the acreage described in paragraph (2), 
     exceeds the actual cropland acreage of the farm, the 
     Secretary shall reduce the base acres for 1 or more covered 
     commodities for the farm or the base acres for peanuts for 
     the farm under subtitle C so that the sum of the base acres 
     and acreage described in paragraph (2) does not exceed the 
     actual cropland acreage of the farm.
       (2) Other acreage.--For purposes of paragraph (1), the 
     Secretary shall include the following:
       (A) Any base acres for peanuts for the farm under subtitle 
     C.
       (B) Any acreage on the farm enrolled in the conservation 
     reserve program or wetlands reserve program under chapter 1 
     of subtitle D of title XII of the Food Security Act of 1985 
     (16 U.S.C. 3830 et seq.).
       (C) Any other acreage on the farm enrolled in a 
     conservation program for which payments are made in exchange 
     for not producing an agricultural commodity on the acreage.
       (3) Selection of acres.--The Secretary shall give the owner 
     of the farm the opportunity to select the base acres or the 
     base acres for peanuts for the farm under subtitle C against 
     which the reduction required by paragraph (1) will be made.
       (4) Exception for double-cropped acreage.--In applying 
     paragraph (1), the Secretary shall make an exception in the 
     case of double cropping, as determined by the Secretary.
       (5) Coordinated application of requirements.--The Secretary 
     shall take into account section 1302(f) when applying the 
     requirements of this subsection.
       (h) Permanent Reduction in Base Acres.--The owner of a farm 
     may reduce, at any time, the base acres for any covered 
     commodity for the farm. The reduction shall be permanent and 
     made in the manner prescribed by the Secretary.

     SEC. 1102. ESTABLISHMENT OF PAYMENT YIELD.

       (a) Establishment and Purpose.--For the purpose of making 
     direct payments and counter-cyclical payments under this 
     subtitle, the Secretary shall provide for the establishment 
     of a payment yield for each farm for each covered commodity 
     in accordance with this section.
       (b) Use of Farm Program Payment Yield.--Except as otherwise 
     provided in this section, the payment yield for each of the 
     2002 through 2007 crops of a covered commodity for a farm 
     shall be the farm program payment yield established for the 
     1995 crop of the covered commodity under section 505 of the 
     Agricultural Act of 1949 (7 U.S.C. 1465), as adjusted by the 
     Secretary to account for any additional yield payments made 
     with respect to that crop under section 505(b)(2) of that 
     Act.
       (c) Farms Without Farm Program Payment Yield.--In the case 
     of a farm for which a farm program payment yield is 
     unavailable for a covered commodity (other than soybeans or 
     other oilseeds), the Secretary shall establish an appropriate 
     payment yield for the covered commodity on the farm taking 
     into consideration the farm program payment yields applicable 
     to the commodity under subsection (b) for similar farms, but 
     before the yields for the similar farms are updated as 
     provided in subsection (e).
       (d) Payment Yields for Oilseeds.--
       (1) Determination of average yield.--In the case of 
     soybeans and each other oilseed, the Secretary shall 
     determine the average yield per planted acre for the oilseed 
     on a farm for the 1998 through 2001 crop years, excluding any 
     crop year in which the acreage planted to the oilseed was 
     zero.
       (2) Adjustment for payment yield.--The payment yield for a 
     farm for an oilseed shall be equal to the product of the 
     following:
       (A) The average yield for the oilseed determined under 
     paragraph (1).
       (B) The ratio resulting from dividing the national average 
     yield for the oilseed for the 1981 through 1985 crops by the 
     national average yield for the oilseed for the 1998 through 
     2001 crops.
       (3) Use of partial county average yield.--If the yield per 
     planted acre for a crop of an oilseed for a farm for any of 
     the 1998 through 2001 crop years was less than 75 percent of 
     the county yield for that oilseed, the Secretary shall assign 
     a yield for that crop year equal to 75 percent of the county 
     yield for the purpose of determining the average under 
     paragraph (1).
       (e) Opportunity To Partially Update Yields Used To 
     Determine Counter-Cyclical Payments.--
       (1) Election to update.--If the owner of a farm elects to 
     use the base acres calculation method described in section 
     1101(a)(1)(A), the owner shall also have a 1-time opportunity 
     to elect to use 1 of the methods described in paragraph (3) 
     to partially update the payment yields that would otherwise 
     be used in calculating any counter-cyclical payments for 
     covered commodities on the farm.
       (2) Time for election.--The election under paragraph (1) 
     shall be made at the same time and in the same manner as the 
     Secretary prescribes for the election required under section 
     1101.
       (3) Methods of updating yields.--If the owner of a farm 
     elects to update yields under this subsection, the payment 
     yield for a covered commodity on the farm, for the purpose of 
     calculating counter-cyclical payments only, shall be equal to 
     the yield determined using either of the following:
       (A) The sum of the following:
       (i) The payment yield applicable for direct payments for 
     the covered commodity on the farm.
       (ii) 70 percent of the difference between--

       (I) the average yield per planted acre for the crop of the 
     covered commodity on the farm for the 1998 through 2001 crop 
     years, as determined by the Secretary, excluding any crop 
     year in which the acreage planted to the crop of the covered 
     commodity was zero; and
       (II) the payment yield applicable for direct payments for 
     the covered commodity on the farm.

       (B) 93.5 percent of the average of the yield per planted 
     acre for the crop of the covered commodity on the farm for 
     the 1998 through 2001 crop years, as determined by the 
     Secretary, excluding any crop year in which the acreage 
     planted to the crop of the covered commodity was zero.
       (4) Use of partial county average yield.--If the yield per 
     planted acre for a crop of the covered commodity for a farm 
     for any of the 1998 through 2001 crop years was less than 75 
     percent of the county yield for that commodity, the Secretary 
     shall assign a yield for that crop year equal to 75 percent 
     of the county yield for the purpose of determining the 
     average yield under paragraph (3).
       (5) Application of election and method to all covered 
     commodities.--The owner of a farm may not elect the method 
     described in paragraph (3)(A) for 1 covered commodity on the 
     farm and the method described in paragraph (3)(B) for other 
     covered commodities on the farm.

     SEC. 1103. AVAILABILITY OF DIRECT PAYMENTS.

       (a) Payment Required.--For each of the 2002 through 2007 
     crop years of each covered commodity, the Secretary shall 
     make direct payments to producers on farms for which payment 
     yields and base acres are established.
       (b) Payment Rate.--The payment rates used to make direct 
     payments with respect to covered commodities for a crop year 
     are as follows:
       (1) Wheat, $0.52 per bushel.
       (2) Corn, $0.28 per bushel.
       (3) Grain sorghum, $0.35 per bushel.
       (4) Barley, $0.24 per bushel.
       (5) Oats, $0.024 per bushel.
       (6) Upland cotton, $0.0667 per pound.
       (7) Rice, $2.35 per hundredweight.
       (8) Soybeans, $0.44 per bushel.
       (9) Other oilseeds, $0.0080 per pound.
       (c) Payment Amount.--The amount of the direct payment to be 
     paid to the producers on a farm for a covered commodity for a 
     crop year shall be equal to the product of the following:
       (1) The payment rate specified in subsection (b).
       (2) The payment acres of the covered commodity on the farm.
       (3) The payment yield for the covered commodity for the 
     farm.
       (d) Time for Payment.--
       (1) In general.--The Secretary shall make direct payments--
       (A) in the case of the 2002 crop year, as soon as 
     practicable after the date of enactment of this Act; and
       (B) in the case of each of the 2003 through 2007 crop 
     years, not before October 1 of the calendar year in which the 
     crop of the covered commodity is harvested.
       (2) Advance payments.--At the option of the producers on a 
     farm, up to 50 percent of the direct payment for a covered 
     commodity for any of the 2003 through 2007 crop years shall 
     be paid to the producers in advance. The producers shall 
     select the month within which the advance payment for a crop 
     year will be made. The month selected may be any month during 
     the period beginning on December 1 of the calendar year 
     before the calendar year in which the crop of the covered 
     commodity is harvested through the month within which the 
     direct payment would otherwise be made. The producers may 
     change the selected month for a subsequent advance payment by 
     providing advance notice to the Secretary.
       (3) Repayment of advance payments.--If a producer on a farm 
     that receives an advance direct payment for a crop year 
     ceases to be a producer on that farm, or the extent to which 
     the producer shares in the risk of producing a crop changes, 
     before the date the remainder of the direct payment is made, 
     the producer shall be responsible for repaying the Secretary 
     the applicable amount of the advance payment, as determined 
     by the Secretary.

     SEC. 1104. AVAILABILITY OF COUNTER-CYCLICAL PAYMENTS.

       (a) Payment Required.--For each of the 2002 through 2007 
     crop years for each covered commodity, the Secretary shall 
     make counter-cyclical payments to producers on farms for 
     which payment yields and base acres are established

[[Page H1801]]

     with respect to the covered commodity if the Secretary 
     determines that the effective price for the covered commodity 
     is less than the target price for the covered commodity.
       (b) Effective Price.--For purposes of subsection (a), the 
     effective price for a covered commodity is equal to the sum 
     of the following:
       (1) The higher of the following:
       (A) The national average market price received by producers 
     during the 12-month marketing year for the covered commodity, 
     as determined by the Secretary.
       (B) The national average loan rate for a marketing 
     assistance loan for the covered commodity in effect for the 
     applicable period under subtitle B.
       (2) The payment rate in effect for the covered commodity 
     under section 1103 for the purpose of making direct payments 
     with respect to the covered commodity.
       (c) Target Price.--
       (1) 2002 and 2003 crop years.--For purposes of the 2002 and 
     2003 crop years, the target prices for covered commodities 
     shall be as follows:
       (A) Wheat, $3.86 per bushel.
       (B) Corn, $2.60 per bushel.
       (C) Grain sorghum, $2.54 per bushel.
       (D) Barley, $2.21 per bushel.
       (E) Oats, $1.40 per bushel.
       (F) Upland cotton, $0.7240 per pound.
       (G) Rice, $10.50 per hundredweight.
       (H) Soybeans, $5.80 per bushel.
       (I) Other oilseeds, $0.0980 per pound.
       (2) Subsequent crop years.--For purposes of each of the 
     2004 through 2007 crop years, the target prices for covered 
     commodities shall be as follows:
       (A) Wheat, $3.92 per bushel.
       (B) Corn, $2.63 per bushel.
       (C) Grain sorghum, $2.57 per bushel.
       (D) Barley, $2.24 per bushel.
       (E) Oats, $1.44 per bushel.
       (F) Upland cotton, $0.7240 per pound.
       (G) Rice, $10.50 per hundredweight.
       (H) Soybeans, $5.80 per bushel.
       (I) Other oilseeds, $0.1010 per pound.
       (d) Payment Rate.--The payment rate used to make counter-
     cyclical payments with respect to a covered commodity for a 
     crop year shall be equal to the difference between--
       (1) the target price for the covered commodity; and
       (2) the effective price determined under subsection (b) for 
     the covered commodity.
       (e) Payment Amount.--If counter-cyclical payments are 
     required to be paid for any of the 2002 through 2007 crop 
     years of a covered commodity, the amount of the counter-
     cyclical payment to be paid to the producers on a farm for 
     that crop year shall be equal to the product of the 
     following:
       (1) The payment rate specified in subsection (d).
       (2) The payment acres of the covered commodity on the farm.
       (3) The payment yield or updated payment yield for the 
     farm, depending on the election of the owner of the farm 
     under section 1102.
       (f) Time for Payments.--
       (1) General rule.--If the Secretary determines under 
     subsection (a) that counter-cyclical payments are required to 
     be made under this section for the crop of a covered 
     commodity, the Secretary shall make the counter-cyclical 
     payments for the crop as soon as practicable after the end of 
     the 12-month marketing year for the covered commodity.
       (2) Availability of partial payments.--If, before the end 
     of the 12-month marketing year for a covered commodity, the 
     Secretary estimates that counter-cyclical payments will be 
     required for the crop of the covered commodity, the Secretary 
     shall give producers on a farm the option to receive partial 
     payments of the counter-cyclical payment projected to be made 
     for that crop of the covered commodity.
       (3) Time for partial payments.--
       (A) 2002 through 2006 crop years.--When the Secretary makes 
     partial payments available under paragraph (2) for a covered 
     commodity for any of the 2002 through 2006 crop years--
       (i) the first partial payment for the crop year shall be 
     made not earlier than October 1, and, to the maximum extent 
     practicable, not later than October 31, of the calendar year 
     in which the crop of the covered commodity is harvested;
       (ii) the second partial payment shall be made not earlier 
     than February 1 of the next calendar year; and
       (iii) the final partial payment shall be made as soon as 
     practicable after the end of the 12-month marketing year for 
     the covered commodity.
       (B) 2007 crop year.--When the Secretary makes partial 
     payments available for a covered commodity for the 2007 crop 
     year--
       (i) the first partial payment shall be made after 
     completion of the first 6 months of the marketing year for 
     the covered commodity; and
       (ii) the final partial payment shall be made as soon as 
     practicable after the end of the 12-month marketing year for 
     the covered commodity.
       (4) Amount of partial payments.--
       (A) 2002 through 2006 crop years.--
       (i) First partial payment.--For each of the 2002 through 
     2006 crop years of a covered commodity, the first partial 
     payment under paragraph (3) to the producers on a farm may 
     not exceed 35 percent of the projected counter-cyclical 
     payment for the covered commodity for the crop year, as 
     determined by the Secretary.
       (ii) Second partial payment.--The second partial payment 
     for a covered commodity for a crop year may not exceed the 
     difference between--

       (I) 70 percent of the projected counter-cyclical payment 
     (including any revision thereof) for the crop of the covered 
     commodity; and
       (II) the amount of the payment made under clause (i).

       (iii) Final payment.--The final payment for a covered 
     commodity for a crop year shall be equal to the difference 
     between--

       (I) the actual counter-cyclical payment to be made to the 
     producers for the covered commodity for that crop year; and
       (II) the amount of the partial payments made to the 
     producers under clauses (i) and (ii) for that crop year.

       (B) 2007 crop year.--
       (i) First partial payment.--For the 2007 crop year, the 
     first partial payment under paragraph (3) to the producers on 
     a farm may not exceed 40 percent of the projected counter-
     cyclical payment for the covered commodity for the crop year, 
     as determined by the Secretary.
       (ii) Final payment.--The final payment for the 2007 crop 
     year shall be equal to the difference between--

       (I) the actual counter-cyclical payment to be made to the 
     producers for the covered commodity for that crop year; and
       (II) the amount of the partial payment made to the 
     producers under clause (i).

       (5) Repayment.--The producers on a farm that receive a 
     partial payment under this subsection for a crop year shall 
     repay to the Secretary the amount, if any, by which the total 
     of the partial payments exceed the actual counter-cyclical 
     payment to be made for the covered commodity for that crop 
     year.

     SEC. 1105. PRODUCER AGREEMENT REQUIRED AS CONDITION OF 
                   PROVISION OF DIRECT PAYMENTS AND COUNTER-
                   CYCLICAL PAYMENTS.

       (a) Compliance With Certain Requirements.--
       (1) Requirements.--Before the producers on a farm may 
     receive direct payments or counter-cyclical payments with 
     respect to the farm, the producers shall agree, during the 
     crop year for which the payments are made and in exchange for 
     the payments--
       (A) to comply with applicable conservation requirements 
     under subtitle B of title XII of the Food Security Act of 
     1985 (16 U.S.C. 3811 et seq.);
       (B) to comply with applicable wetland protection 
     requirements under subtitle C of title XII of the Act (16 
     U.S.C. 3821 et seq.);
       (C) to comply with the planting flexibility requirements of 
     section 1106;
       (D) to use the land on the farm, in a quantity equal to the 
     attributable base acres for the farm and any base acres for 
     peanuts for the farm under subtitle C for an agricultural or 
     conserving use, and not for a nonagricultural commercial or 
     industrial use, as determined by the Secretary; and
       (E) to effectively control noxious weeds and otherwise 
     maintain the land in accordance with sound agricultural 
     practices, as determined by the Secretary, if the 
     agricultural or conserving use involves the noncultivation of 
     any portion of the land referred to in subparagraph (D).
       (2) Compliance.--The Secretary may issue such rules as the 
     Secretary considers necessary to ensure producer compliance 
     with the requirements of paragraph (1).
       (3) Modification.--At the request of the transferee or 
     owner, the Secretary may modify the requirements of this 
     subsection if the modifications are consistent with the 
     objectives of this subsection, as determined by the 
     Secretary.
       (b) Transfer or Change of Interest in Farm.--
       (1) Termination.--Except as provided in paragraph (2), a 
     transfer of (or change in) the interest of the producers on a 
     farm in base acres for which direct payments or counter-
     cyclical payments are made shall result in the termination of 
     the payments with respect to the base acres, unless the 
     transferee or owner of the acreage agrees to assume all 
     obligations under subsection (a). The termination shall take 
     effect on the date determined by the Secretary.
       (2) Exception.--If a producer entitled to a direct payment 
     or counter-cyclical payment dies, becomes incompetent, or is 
     otherwise unable to receive the payment, the Secretary shall 
     make the payment, in accordance with rules issued by the 
     Secretary.
       (c) Acreage Reports.--As a condition on the receipt of any 
     benefits under this subtitle or subtitle B, the Secretary 
     shall require producers on a farm to submit to the Secretary 
     annual acreage reports with respect to all cropland on the 
     farm.
       (d) Tenants and Sharecroppers.--In carrying out this 
     subtitle, the Secretary shall provide adequate safeguards to 
     protect the interests of tenants and sharecroppers.
       (e) Sharing of Payments.--The Secretary shall provide for 
     the sharing of direct payments and counter-cyclical payments 
     among the producers on a farm on a fair and equitable basis.

     SEC. 1106. PLANTING FLEXIBILITY.

       (a) Permitted Crops.--Subject to subsection (b), any 
     commodity or crop may be planted on base acres on a farm.
       (b) Limitations Regarding Certain Commodities.--
       (1) General limitation.--The planting of an agricultural 
     commodity specified in paragraph (3) shall be prohibited on 
     base acres unless the commodity, if planted, is destroyed 
     before harvest.
       (2) Treatment of trees and other perennials.--The planting 
     of an agricultural commodity specified in paragraph (3) that 
     is produced on a tree or other perennial plant shall be 
     prohibited on base acres.
       (3) Covered agricultural commodities.--Paragraphs (1) and 
     (2) apply to the following agricultural commodities:
       (A) Fruits.
       (B) Vegetables (other than lentils, mung beans, and dry 
     peas).
       (C) Wild rice.
       (c) Exceptions.--Paragraphs (1) and (2) of subsection (b) 
     shall not limit the planting of an agricultural commodity 
     specified in paragraph (3) of that subsection--
       (1) in any region in which there is a history of double-
     cropping of covered commodities with

[[Page H1802]]

     agricultural commodities specified in subsection (b)(3), as 
     determined by the Secretary, in which case the double-
     cropping shall be permitted;
       (2) on a farm that the Secretary determines has a history 
     of planting agricultural commodities specified in subsection 
     (b)(3) on base acres, except that direct payments and 
     counter-cyclical payments shall be reduced by an acre for 
     each acre planted to such an agricultural commodity; or
       (3) by the producers on a farm that the Secretary 
     determines has an established planting history of a specific 
     agricultural commodity specified in subsection (b)(3), except 
     that--
       (A) the quantity planted may not exceed the average annual 
     planting history of such agricultural commodity by the 
     producers on the farm in the 1991 through 1995 or 1998 
     through 2001 crop years (excluding any crop year in which no 
     plantings were made), as determined by the Secretary; and
       (B) direct payments and counter-cyclical payments shall be 
     reduced by an acre for each acre planted to such agricultural 
     commodity.
       (d) Special Rule for 2002 Crop Year.--For the 2002 crop 
     year only, if the calculation of base acres under section 
     1101(a) results in total base acres for a farm in excess of 
     the contract acreage (as defined in section 102 of the 
     Federal Agriculture Improvement and Reform Act of 1996 (7 
     U.S.C. 7202)) for the farm used to calculate the fiscal year 
     2002 payment authorized under section 114 of such Act (7 
     U.S.C. 7214), paragraphs (1) and (2) of subsection (b) shall 
     not limit the harvesting of an agricultural commodity 
     specified in paragraph (3) of that subsection on the excess 
     base acres, except that direct payments and counter-cyclical 
     payments for the 2002 crop year shall be reduced by an acre 
     for each acre of the excess base acres planted to such an 
     agricultural commodity.

     SEC. 1107. RELATION TO REMAINING PAYMENT AUTHORITY UNDER 
                   PRODUCTION FLEXIBILITY CONTRACTS.

       (a) Termination of Superseded Payment Authority.--
     Notwithstanding section 113(a)(7) of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7213(a)(7)) or 
     any other provision of law, the Secretary shall not make 
     payments for fiscal year 2002 after the date of enactment of 
     this Act under a production flexibility contract entered into 
     under section 111 of that Act (7 U.S.C. 7211) unless 
     requested by the producer that is a party to the contract.
       (b) Contract Payments Made Before Enactment.--If a producer 
     receives all or any portion of the payment authorized for 
     fiscal year 2002 under a production flexibility contract, the 
     Secretary shall reduce the amount of the direct payment 
     otherwise due the producer for the 2002 crop year under 
     section 1103 by the amount of the fiscal year 2002 payment 
     received by the producer under the production flexibility 
     contract.

     SEC. 1108. PERIOD OF EFFECTIVENESS.

       This subtitle shall be effective beginning with the 2002 
     crop year of each covered commodity through the 2007 crop 
     year.
  Subtitle B--Marketing Assistance Loans and Loan Deficiency Payments

     SEC. 1201. AVAILABILITY OF NONRECOURSE MARKETING ASSISTANCE 
                   LOANS FOR LOAN COMMODITIES.

       (a) Nonrecourse Loans Available.--
       (1) Availability.--For each of the 2002 through 2007 crops 
     of each loan commodity, the Secretary shall make available to 
     producers on a farm nonrecourse marketing assistance loans 
     for loan commodities produced on the farm.
       (2) Terms and conditions.--The marketing assistance loans 
     shall be made under terms and conditions that are prescribed 
     by the Secretary and at the loan rate established under 
     section 1202 for the loan commodity.
       (b) Eligible Production.--The producers on a farm shall be 
     eligible for a marketing assistance loan under subsection (a) 
     for any quantity of a loan commodity produced on the farm.
       (c) Treatment of Certain Commingled Commodities.--In 
     carrying out this subtitle, the Secretary shall make loans to 
     producers on a farm that would be eligible to obtain a 
     marketing assistance loan, but for the fact the loan 
     commodity owned by the producers on the farm commingled with 
     loan commodities of other producers in facilities unlicensed 
     for the storage of agricultural commodities by the Secretary 
     or a State licensing authority, if the producers obtaining 
     the loan agree to immediately redeem the loan collateral in 
     accordance with section 166 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7286).
       (d) Compliance With Conservation and Wetlands 
     Requirements.--As a condition of the receipt of a marketing 
     assistance loan under subsection (a), the producer shall 
     comply with applicable conservation requirements under 
     subtitle B of title XII of the Food Security Act of 1985 (16 
     U.S.C. 3811 et seq.) and applicable wetland protection 
     requirements under subtitle C of title XII of the Act (16 
     U.S.C. 3821 et seq.) during the term of the loan.
       (e) Termination of Superseded Loan Authority.--
     Notwithstanding section 131 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7231), 
     nonrecourse marketing assistance loans shall not be made for 
     the 2002 crop of loan commodities under subtitle C of title I 
     of such Act.

     SEC. 1202. LOAN RATES FOR NONRECOURSE MARKETING ASSISTANCE 
                   LOANS.

       (a) 2002 and 2003 Crop Years.--For purposes of the 2002 and 
     2003 crop years, the loan rate for a marketing assistance 
     loan under section 1201 for a loan commodity shall be equal 
     to the following:
       (1) In the case of wheat, $2.80 per bushel.
       (2) In the case of corn, $1.98 per bushel.
       (3) In the case of grain sorghum, $1.98 per bushel.
       (4) In the case of barley, $1.88 per bushel.
       (5) In the case of oats, $1.35 per bushel.
       (6) In the case of upland cotton, $0.52 per pound.
       (7) In the case of extra long staple cotton, $0.7977 per 
     pound.
       (8) In the case of rice, $6.50 per hundredweight.
       (9) In the case of soybeans, $5.00 per bushel.
       (10) In the case of other oilseeds, $0.0960 per pound.
       (11) In the case of graded wool, $1.00 per pound.
       (12) In the case of nongraded wool, $0.40 per pound.
       (13) In the case of mohair, $4.20 per pound.
       (14) In the case of honey, $0.60 per pound.
       (15) In the case of dry peas, $6.33 per hundredweight.
       (16) In the case of lentils, $11.94 per hundredweight.
       (17) In the case of small chickpeas, $7.56 per 
     hundredweight.
       (b) 2004 Through 2007 Crop Years.--For purposes of the 2004 
     through 2007 crop years, the loan rate for a marketing 
     assistance loan under section 1201 for a loan commodity shall 
     be equal to the following:
       (1) In the case of wheat, $2.75 per bushel.
       (2) In the case of corn, $1.95 per bushel.
       (3) In the case of grain sorghum, $1.95 per bushel.
       (4) In the case of barley, $1.85 per bushel.
       (5) In the case of oats, $1.33 per bushel.
       (6) In the case of upland cotton, $0.52 per pound.
       (7) In the case of extra long staple cotton, $0.7977 per 
     pound.
       (8) In the case of rice, $6.50 per hundredweight.
       (9) In the case of soybeans, $5.00 per bushel.
       (10) In the case of other oilseeds, $0.0930 per pound.
       (11) In the case of graded wool, $1.00 per pound.
       (12) In the case of nongraded wool, $0.40 per pound.
       (13) In the case of mohair, $4.20 per pound.
       (14) In the case of honey, $0.60 per pound.
       (15) In the case of dry peas, $6.22 per hundredweight.
       (16) In the case of lentils, $11.72 per hundredweight.
       (17) In the case of small chickpeas, $7.43 per 
     hundredweight.

     SEC. 1203. TERM OF LOANS.

       (a) Term of Loan.--In the case of each loan commodity, a 
     marketing assistance loan under section 1201 shall have a 
     term of 9 months beginning on the first day of the first 
     month after the month in which the loan is made.
       (b) Extensions Prohibited.--The Secretary may not extend 
     the term of a marketing assistance loan for any loan 
     commodity.

     SEC. 1204. REPAYMENT OF LOANS.

       (a) General Rule.--The Secretary shall permit the producers 
     on a farm to repay a marketing assistance loan under section 
     1201 for a loan commodity (other than upland cotton, rice, 
     and extra long staple cotton) at a rate that is the lesser 
     of--
       (1) the loan rate established for the commodity under 
     section 1202, plus interest (determined in accordance with 
     section 163 of the Federal Agriculture Improvement and Reform 
     Act of 1996 (7 U.S.C. 7283)); or
       (2) a rate that the Secretary determines will--
       (A) minimize potential loan forfeitures;
       (B) minimize the accumulation of stocks of the commodity by 
     the Federal Government;
       (C) minimize the cost incurred by the Federal Government in 
     storing the commodity;
       (D) allow the commodity produced in the United States to be 
     marketed freely and competitively, both domestically and 
     internationally; and
       (E) minimize discrepancies in marketing loan benefits 
     across State boundaries and across county boundaries.
       (b) Repayment Rates for Upland Cotton and Rice.--The 
     Secretary shall permit producers to repay a marketing 
     assistance loan under section 1201 for upland cotton and rice 
     at a rate that is the lesser of--
       (1) the loan rate established for the commodity under 
     section 1202, plus interest (determined in accordance with 
     section 163 of the Federal Agriculture Improvement and Reform 
     Act of 1996 (7 U.S.C. 7283)); or
       (2) the prevailing world market price for the commodity 
     (adjusted to United States quality and location), as 
     determined by the Secretary.
       (c) Repayment Rates for Extra Long Staple Cotton.--
     Repayment of a marketing assistance loan for extra long 
     staple cotton shall be at the loan rate established for the 
     commodity under section 1202, plus interest (determined in 
     accordance with section 163 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7283)).
       (d) Prevailing World Market Price.--For purposes of this 
     section and section 1207, the Secretary shall prescribe by 
     regulation--
       (1) a formula to determine the prevailing world market 
     price for upland cotton and rice, adjusted to United States 
     quality and location; and
       (2) a mechanism by which the Secretary shall announce 
     periodically the prevailing world market price for upland 
     cotton and rice.
       (e) Adjustment of Prevailing World Market Price for Upland 
     Cotton.--
       (1) In general.--During the period beginning on the date of 
     the enactment of this Act through July 31, 2008, the 
     prevailing world market price for upland cotton (adjusted to 
     United States quality and location) established under 
     subsection (d) shall be further adjusted if--
       (A) the adjusted prevailing world market price is less than 
     115 percent of the loan rate for upland cotton established 
     under section 1202, as determined by the Secretary; and
       (B) the Friday through Thursday average price quotation for 
     the lowest-priced United

[[Page H1803]]

     States growth as quoted for Middling (M) 1\3/32\-inch cotton 
     delivered C.I.F. Northern Europe is greater than the Friday 
     through Thursday average price of the 5 lowest-priced growths 
     of upland cotton, as quoted for Middling (M) 1\3/32\-inch 
     cotton, delivered C.I.F. Northern Europe (referred to in this 
     section as the ``Northern Europe price'').
       (2) Further adjustment.--Except as provided in paragraph 
     (3), the adjusted prevailing world market price for upland 
     cotton shall be further adjusted on the basis of some or all 
     of the following data, as available:
       (A) The United States share of world exports.
       (B) The current level of cotton export sales and cotton 
     export shipments.
       (C) Other data determined by the Secretary to be relevant 
     in establishing an accurate prevailing world market price for 
     upland cotton (adjusted to United States quality and 
     location).
       (3) Limitation on further adjustment.--The adjustment under 
     paragraph (2) may not exceed the difference between--
       (A) the Friday through Thursday average price for the 
     lowest-priced United States growth as quoted for Middling 
     1\3/32\-inch cotton delivered C.I.F. Northern Europe; and
       (B) the Northern Europe price.
       (f) Good Faith Exception to Beneficial Interest 
     Requirement.--For the 2001 crop year only, in the case of the 
     producers on a farm that marketed or otherwise lost 
     beneficial interest in a loan commodity for which a marketing 
     assistance loan was made under section 131 of the Federal 
     Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 
     7231) before repaying the loan, the Secretary shall permit 
     the producers to repay the loan at the appropriate repayment 
     rate that was in effect for the loan commodity under section 
     134 of that Act (7 U.S.C. 7234) on the date that the 
     producers lost beneficial interest, as determined by the 
     Secretary, if the Secretary determines the producers acted in 
     good faith.

     SEC. 1205. LOAN DEFICIENCY PAYMENTS.

       (a) Availability of Loan Deficiency Payments.--
       (1) In general.--Except as provided in subsection (d), the 
     Secretary may make loan deficiency payments available to 
     producers on a farm that, although eligible to obtain a 
     marketing assistance loan under section 1201 with respect to 
     a loan commodity, agree to forgo obtaining the loan for the 
     commodity in return for loan deficiency payments under this 
     section.
       (2) Unshorn pelts, hay, and silage.--Nongraded wool in the 
     form of unshorn pelts and hay and silage derived from a loan 
     commodity are not eligible for a marketing assistance loan 
     under section 1201. However, effective for the 2002 through 
     2007 crop years, the Secretary may make loan deficiency 
     payments available under this section to producers on a farm 
     that produce unshorn pelts or hay and silage derived from a 
     loan commodity.
       (b) Computation.--A loan deficiency payment for a loan 
     commodity or commodity referred to in subsection (a)(2) shall 
     be computed by multiplying--
       (1) the payment rate determined under subsection (c) for 
     the commodity; by
       (2) the quantity of the commodity produced by the eligible 
     producers, excluding any quantity for which the producers 
     obtain a marketing assistance loan under section 1201.
       (c) Payment Rate.--
       (1) In general.--In the case of a loan commodity, the 
     payment rate shall be the amount by which--
       (A) the loan rate established under section 1202 for the 
     loan commodity; exceeds
       (B) the rate at which a marketing assistance loan for the 
     loan commodity may be repaid under section 1204.
       (2) Unshorn pelts.--In the case of unshorn pelts, the 
     payment rate shall be the amount by which--
       (A) the loan rate established under section 1202 for 
     ungraded wool; exceeds
       (B) the rate at which a marketing assistance loan for 
     ungraded wool may be repaid under section 1204.
       (3) hay and silage.--In the case of hay or silage derived 
     from a loan commodity, the payment rate shall be the amount 
     by which--
       (A) the loan rate established under section 1202 for the 
     loan commodity from which the hay or silage is derived; 
     exceeds
       (B) the rate at which a marketing assistance loan for the 
     loan commodity may be repaid under section 1204.
       (d) Exception for Extra Long Staple Cotton.--This section 
     shall not apply with respect to extra long staple cotton.
       (e) Effective Date for Payment Rate Determination.--The 
     Secretary shall determine the amount of the loan deficiency 
     payment to be made under this section to the producers on a 
     farm with respect to a quantity of a loan commodity or 
     commodity referred to in subsection (a)(2) using the payment 
     rate in effect under subsection (c) as of the date the 
     producers request the payment.
       (f) Special Loan Deficiency Payment Rules.--
       (1) First-time loan commodities.--For the 2002 crop of 
     wool, mohair, honey, dry peas, lentils and small chickpeas, 
     in the case of producers of such a crop that would be 
     eligible for a loan deficiency payment under this section 
     except for the fact that the producers lost beneficial 
     interest in the crop prior to the date of publication of 
     the regulations implementing this section, the producers 
     shall be eligible for a loan deficiency payment as of the 
     date producers marketed or otherwise lost beneficial 
     interest in the crop, as determined by the Secretary.
       (2) 2001 crop year.--Section 135 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7235) is 
     amended--
       (A) in subsection (a)(2), by striking ``2000 crop year'' 
     and inserting ``2000 and 2001 crop years''; and
       (B) by adding at the end the following:
       ``(g) Effective Date for Payment Rate Determination.--For 
     the 2001 crop year, the Secretary shall determine the amount 
     of the loan deficiency payment to be made under this section 
     to the producers on a farm with respect to a quantity of a 
     loan commodity using the payment rate in effect under 
     subsection (c) as of the earlier of the following:
       ``(1) The date on which the producers marketed or otherwise 
     lost beneficial interest in the crop of the loan commodity, 
     as determined by the Secretary.
       ``(2) The date the producers requested the payment.''.

     SEC. 1206. PAYMENTS IN LIEU OF LOAN DEFICIENCY PAYMENTS FOR 
                   GRAZED ACREAGE.

       (a) Eligible Producers.--
       (1) In general.--Effective for the 2002 through 2007 crop 
     years, in the case of a producer that would be eligible for a 
     loan deficiency payment under section 1205 for wheat, barley, 
     or oats, but that elects to use acreage planted to the wheat, 
     barley, or oats for the grazing of livestock, the Secretary 
     shall make a payment to the producer under this section if 
     the producer enters into an agreement with the Secretary to 
     forgo any other harvesting of the wheat, barley, or oats on 
     that acreage.
       (2) Grazing of triticale acreage.--Effective for the 2002 
     through 2007 crop years, with respect to a producer on a farm 
     that uses acreage planted to triticale for the grazing of 
     livestock, the Secretary shall make a payment to the producer 
     under this section if the producer enters into an agreement 
     with the Secretary to forgo any other harvesting of triticale 
     on that acreage.
       (b) Payment Amount.--
       (1) In general.--The amount of a payment made under this 
     section to a producer on a farm described in subsection 
     (a)(1) shall be equal to the amount determined by 
     multiplying--
       (A) the loan deficiency payment rate determined under 
     section 1205(c) in effect, as of the date of the agreement, 
     for the county in which the farm is located; by
       (B) the payment quantity determined by multiplying--
       (i) the quantity of the grazed acreage on the farm with 
     respect to which the producer elects to forgo harvesting of 
     wheat, barley, or oats; and
       (ii) the payment yield in effect for the calculation of 
     direct payments under subtitle A with respect to that loan 
     commodity on the farm or, in the case of a farm without a 
     payment yield for that loan commodity, an appropriate yield 
     established by the Secretary in a manner consistent with 
     section 1102(c).
       (2) Grazing of triticale acreage.--The amount of a payment 
     made under this section to a producer on a farm described in 
     subsection (a)(2) shall be equal to the amount determined by 
     multiplying--
       (A) the loan deficiency payment rate determined under 
     section 1205(c) in effect for wheat, as of the date of the 
     agreement, for the county in which the farm is located; by
       (B) the payment quantity determined by multiplying--
       (i) the quantity of the grazed acreage on the farm with 
     respect to which the producer elects to forgo harvesting of 
     triticale; and
       (ii) the payment yield in effect for the calculation of 
     direct payments under subtitle A with respect to wheat on the 
     farm or, in the case of a farm without a payment yield for 
     wheat, an appropriate yield established by the Secretary in a 
     manner consistent with section 1102(c).
       (c) Time, Manner, and Availability of Payment.--
       (1) Time and manner.--A payment under this section shall be 
     made at the same time and in the same manner as loan 
     deficiency payments are made under section 1205.
       (2) Availability.--The Secretary shall establish an 
     availability period for the payments authorized by this 
     section. In the case of wheat, barley, and oats, the 
     availability period shall be consistent with the availability 
     period for the commodity established by the Secretary for 
     marketing assistance loans authorized by this subtitle.
       (d) Prohibition on Crop Insurance Indemnity or Noninsured 
     Crop Assistance.--A 2002 through 2007 crop of wheat, barley, 
     oats, or triticale planted on acreage that a producer elects, 
     in the agreement required by subsection (a), to use for the 
     grazing of livestock in lieu of any other harvesting of the 
     crop shall not be eligible for an indemnity under the Federal 
     Crop Insurance Act (7 U.S.C. 1501 et seq.) or noninsured crop 
     assistance under section 196 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7333).

     SEC. 1207. SPECIAL MARKETING LOAN PROVISIONS FOR UPLAND 
                   COTTON.

       (a) Cotton User Marketing Certificates.--
       (1) Issuance.--During the period beginning on the date of 
     the enactment of this Act through July 31, 2008, the 
     Secretary shall issue marketing certificates or cash 
     payments, at the option of the recipient, to domestic users 
     and exporters for documented purchases by domestic users and 
     sales for export by exporters made in the week following a 
     consecutive 4-week period in which--
       (A) the Friday through Thursday average price quotation for 
     the lowest-priced United States growth, as quoted for 
     Middling (M) 1\3/32\-inch cotton, delivered C.I.F. Northern 
     Europe exceeds the Northern Europe price by more than 1.25 
     cents per pound; and
       (B) the prevailing world market price for upland cotton 
     (adjusted to United States quality and location) does not 
     exceed 134 percent of the loan rate for upland cotton 
     established under section 1202.

[[Page H1804]]

       (2) Value of certificates or payments.--The value of the 
     marketing certificates or cash payments shall be based on the 
     amount of the difference (reduced by 1.25 cents per pound) in 
     the prices during the fourth week of the consecutive 4-week 
     period multiplied by the quantity of upland cotton included 
     in the documented sales.
       (3) Administration of marketing certificates.--
       (A) Redemption, marketing, or exchange.--The Secretary 
     shall establish procedures for redeeming marketing 
     certificates for cash or marketing or exchange of the 
     certificates for agricultural commodities owned by the 
     Commodity Credit Corporation or pledged to the Commodity 
     Credit Corporation as collateral for a loan in such manner, 
     and at such price levels, as the Secretary determines will 
     best effectuate the purposes of cotton user marketing 
     certificates, including enhancing the competitiveness and 
     marketability of United States cotton. Any price restrictions 
     that would otherwise apply to the disposition of agricultural 
     commodities by the Commodity Credit Corporation shall not 
     apply to the redemption of certificates under this 
     subsection.
       (B) Designation of commodities and products.--To the extent 
     practicable, the Secretary shall permit owners of 
     certificates to designate the commodities and products, 
     including storage sites, the owners would prefer to receive 
     in exchange for certificates
       (C) Transfers.--Marketing certificates issued to domestic 
     users and exporters of upland cotton may be transferred to 
     other persons in accordance with regulations issued by the 
     Secretary.
       (4) Delayed application of threshold.--Through July 31, 
     2006, the Secretary shall make the calculations under 
     paragraphs (1)(A) and (2) without regard to the 1.25 cent 
     threshold provided under those paragraphs.
       (b) Special Import Quota.--
       (1) Establishment.--
       (A) In general.--The President shall carry out an import 
     quota program during the period beginning on the date of the 
     enactment of this Act through July 31, 2008, as provided in 
     this subsection.
       (B) Program requirements.--Except as provided in 
     subparagraph (C), whenever the Secretary determines and 
     announces that for any consecutive 4-week period, the Friday 
     through Thursday average price quotation for the lowest-
     priced United States growth, as quoted for Middling (M) 1\3/
     32\-inch cotton, delivered C.I.F. Northern Europe, adjusted 
     for the value of any certificate issued under subsection (a), 
     exceeds the Northern Europe price by more than 1.25 cents per 
     pound, there shall immediately be in effect a special import 
     quota.
       (C) Tight domestic supply.--During any month for which the 
     Secretary estimates the season-ending United States upland 
     cotton stocks-to-use ratio, as determined under subparagraph 
     (D), to be below 16 percent, the Secretary, in making the 
     determination under subparagraph (B), shall not adjust the 
     Friday through Thursday average price quotation for the 
     lowest-priced United States growth, as quoted for Middling 
     (M) 1\3/32\-inch cotton, delivered C.I.F. Northern Europe, 
     for the value of any certificates issued under subsection 
     (a).
       (D) Season-ending united states stocks-to-use ratio.--For 
     the purposes of making estimates under subparagraph (C), the 
     Secretary shall, on a monthly basis, estimate and report the 
     season-ending United States upland cotton stocks-to-use 
     ratio, excluding projected raw cotton imports but including 
     the quantity of raw cotton that has been imported into the 
     United States during the marketing year.
       (E) Delayed application of threshold.--Through July 31, 
     2006, the Secretary shall make the calculation under 
     subparagraph (B) without regard to the 1.25 cent threshold 
     provided under that subparagraph.
       (2) Quantity.--The quota shall be equal to one week's 
     consumption of upland cotton by domestic mills at the 
     seasonally adjusted average rate of the most recent three 
     months for which data are available.
       (3) Application.--The quota shall apply to upland cotton 
     purchased not later than 90 days after the date of the 
     Secretary's announcement under paragraph (1) and entered into 
     the United States not later than 180 days after the date.
       (4) Overlap.--A special quota period may be established 
     that overlaps any existing quota period if required by 
     paragraph (1), except that a special quota period may not be 
     established under this subsection if a quota period has been 
     established under subsection (c).
       (5) Preferential tariff treatment.--The quantity under a 
     special import quota shall be considered to be an in-quota 
     quantity for purposes of--
       (A) section 213(d) of the Caribbean Basin Economic Recovery 
     Act (19 U.S.C. 2703(d));
       (B) section 204 of the Andean Trade Preference Act (19 
     U.S.C. 3203);
       (C) section 503(d) of the Trade Act of 1974 (19 U.S.C. 
     2463(d)); and
       (D) General Note 3(a)(iv) to the Harmonized Tariff 
     Schedule.
       (6) Definition.--In this subsection, the term ``special 
     import quota'' means a quantity of imports that is not 
     subject to the over-quota tariff rate of a tariff-rate quota.
       (7) Limitation.--The quantity of cotton entered into the 
     United States during any marketing year under the special 
     import quota established under this subsection may not exceed 
     the equivalent of 5 week's consumption of upland cotton by 
     domestic mills at the seasonally adjusted average rate of the 
     3 months immediately preceding the first special import quota 
     established in any marketing year.
       (c) Limited Global Import Quota for Upland Cotton.--
       (1) In general.--The President shall carry out an import 
     quota program that provides that whenever the Secretary 
     determines and announces that the average price of the base 
     quality of upland cotton, as determined by the Secretary, in 
     the designated spot markets for a month exceeded 130 percent 
     of the average price of such quality of cotton in the markets 
     for the preceding 36 months, notwithstanding any other 
     provision of law, there shall immediately be in effect a 
     limited global import quota subject to the following 
     conditions:
       (A) Quantity.--The quantity of the quota shall be equal to 
     21 days of domestic mill consumption of upland cotton at the 
     seasonally adjusted average rate of the most recent 3 months 
     for which data are available.
       (B) Quantity if prior quota.--If a quota has been 
     established under this subsection during the preceding 12 
     months, the quantity of the quota next established under this 
     subsection shall be the smaller of 21 days of domestic mill 
     consumption calculated under subparagraph (A) or the quantity 
     required to increase the supply to 130 percent of the demand.
       (C) Preferential tariff treatment.--The quantity under a 
     limited global import quota shall be considered to be an in-
     quota quantity for purposes of--
       (i) section 213(d) of the Caribbean Basin Economic Recovery 
     Act (19 U.S.C. 2703(d));
       (ii) section 204 of the Andean Trade Preference Act (19 
     U.S.C. 3203);
       (iii) section 503(d) of the Trade Act of 1974 (19 U.S.C. 
     2463(d)); and
       (iv) General Note 3(a)(iv) to the Harmonized Tariff 
     Schedule.
       (D) Definitions.--In this subsection:
       (i) Supply.--The term ``supply'' means, using the latest 
     official data of the Bureau of the Census, the Department of 
     Agriculture, and the Department of the Treasury--

       (I) the carry-over of upland cotton at the beginning of the 
     marketing year (adjusted to 480-pound bales) in which the 
     quota is established;
       (II) production of the current crop; and
       (III) imports to the latest date available during the 
     marketing year.

       (ii) Demand.--The term ``demand'' means--

       (I) the average seasonally adjusted annual rate of domestic 
     mill consumption during the most recent 3 months for which 
     data are available; and
       (II) the larger of--

       (aa) average exports of upland cotton during the preceding 
     6 marketing years; or
       (bb) cumulative exports of upland cotton plus outstanding 
     export sales for the marketing year in which the quota is 
     established.
       (iii) Limited global import quota.--The term ``limited 
     global import quota'' means a quantity of imports that is not 
     subject to the over-quota tariff rate of a tariff-rate quota.
       (E) Quota entry period.--When a quota is established under 
     this subsection, cotton may be entered under the quota during 
     the 90-day period beginning on the date the quota is 
     established by the Secretary.
       (2) No overlap.--Notwithstanding paragraph (1), a quota 
     period may not be established that overlaps an existing quota 
     period or a special quota period established under subsection 
     (b).

     SEC. 1208. SPECIAL COMPETITIVE PROVISIONS FOR EXTRA LONG 
                   STAPLE COTTON.

       (a) Competitiveness Program.--Notwithstanding any other 
     provision of law, during the period beginning on the date of 
     the enactment of this Act through July 31, 2008, the 
     Secretary shall carry out a program--
       (1) to maintain and expand the domestic use of extra long 
     staple cotton produced in the United States;
       (2) to increase exports of extra long staple cotton 
     produced in the United States; and
       (3) to ensure that extra long staple cotton produced in the 
     United States remains competitive in world markets.
       (b) Payments Under Program; Trigger.--Under the program, 
     the Secretary shall make payments available under this 
     section whenever--
       (1) for a consecutive 4-week period, the world market price 
     for the lowest priced competing growth of extra long staple 
     cotton (adjusted to United States quality and location and 
     for other factors affecting the competitiveness of such 
     cotton), as determined by the Secretary, is below the 
     prevailing United States price for a competing growth of 
     extra long staple cotton; and
       (2) the lowest priced competing growth of extra long staple 
     cotton (adjusted to United States quality and location and 
     for other factors affecting the competitiveness of such 
     cotton), as determined by the Secretary, is less than 134 
     percent of the loan rate for extra long staple cotton.
       (c) Eligible Recipients.--The Secretary shall make payments 
     available under this section to domestic users of extra long 
     staple cotton produced in the United States and exporters of 
     extra long staple cotton produced in the United States that 
     enter into an agreement with the Commodity Credit Corporation 
     to participate in the program under this section.
       (d) Payment Amount.--Payments under this section shall be 
     based on the amount of the difference in the prices referred 
     to in subsection (b)(1) during the fourth week of the 
     consecutive 4-week period multiplied by the amount of 
     documented purchases by domestic users and sales for export 
     by exporters made in the week following such a consecutive 4-
     week period.
       (e) Form of Payment.--Payments under this section shall be 
     made through the issuance of cash or marketing certificates, 
     at the option of eligible recipients of the payments.

     SEC. 1209. AVAILABILITY OF RECOURSE LOANS FOR HIGH MOISTURE 
                   FEED GRAINS AND SEED COTTON.

       (a) High Moisture Feed Grains.--
       (1) Recourse loans available.--For each of the 2002 through 
     2007 crops of corn and grain sorghum, the Secretary shall 
     make available recourse loans, as determined by the 
     Secretary, to producers on a farm that--

[[Page H1805]]

       (A) normally harvest all or a portion of their crop of corn 
     or grain sorghum in a high moisture state;
       (B) present--
       (i) certified scale tickets from an inspected, certified 
     commercial scale, including a licensed warehouse, feedlot, 
     feed mill, distillery, or other similar entity approved by 
     the Secretary, pursuant to regulations issued by the 
     Secretary; or
       (ii) field or other physical measurements of the standing 
     or stored crop in regions of the United States, as determined 
     by the Secretary, that do not have certified commercial 
     scales from which certified scale tickets may be obtained 
     within reasonable proximity of harvest operation;
       (C) certify that they were the owners of the feed grain at 
     the time of delivery to, and that the quantity to be placed 
     under loan under this subsection was in fact harvested on the 
     farm and delivered to, a feedlot, feed mill, or commercial or 
     on-farm high-moisture storage facility, or to a facility 
     maintained by the users of corn and grain sorghum in a high 
     moisture state; and
       (D) comply with deadlines established by the Secretary for 
     harvesting the corn or grain sorghum and submit applications 
     for loans under this subsection within deadlines established 
     by the Secretary.
       (2) Eligibility of acquired feed grains.--A loan under this 
     subsection shall be made on a quantity of corn or grain 
     sorghum of the same crop acquired by the producer equivalent 
     to a quantity determined by multiplying--
       (A) the acreage of the corn or grain sorghum in a high 
     moisture state harvested on the producer's farm; by
       (B) the lower of the farm program payment yield used to 
     make counter-cyclical payments under subtitle A or the actual 
     yield on a field, as determined by the Secretary, that is 
     similar to the field from which the corn or grain sorghum was 
     obtained.
       (3) High moisture state defined.--In this subsection, the 
     term ``high moisture state'' means corn or grain sorghum 
     having a moisture content in excess of Commodity Credit 
     Corporation standards for marketing assistance loans made by 
     the Secretary under section 1201.
       (b) Recourse Loans Available for Seed Cotton.--For each of 
     the 2002 through 2007 crops of upland cotton and extra long 
     staple cotton, the Secretary shall make available recourse 
     seed cotton loans, as determined by the Secretary, on any 
     production.
       (c) Repayment Rates.--Repayment of a recourse loan made 
     under this section shall be at the loan rate established for 
     the commodity by the Secretary, plus interest (determined in 
     accordance with section 163 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7283)).
       (d) Termination of Superseded Loan Authority.--
     Notwithstanding section 137 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7237), recourse 
     loans shall not be made for the 2002 crop of corn, grain 
     sorghum, and seed cotton under such section.
                          Subtitle C--Peanuts

     SEC. 1301. DEFINITIONS.

       In this subtitle:
       (1) Base acres for peanuts.--The term ``base acres for 
     peanuts'' means the number of acres assigned to a farm by 
     historic peanut producers pursuant to section 1302(b).
       (2) Counter-cyclical payment.--The term ``counter-cyclical 
     payment'' means a payment made under section 1304.
       (3) Effective price.--The term ``effective price'' means 
     the price calculated by the Secretary under section 1304 for 
     peanuts to determine whether counter-cyclical payments are 
     required to be made under that section for a crop year.
       (4) Direct payment.--The term ``direct payment'' means a 
     payment made under section 1303.
       (5) Historic peanut producer.--The term ``historic peanut 
     producer'' means a producer on a farm in the United States 
     that produced or was prevented from planting peanuts during 
     any or all of the 1998 through 2001 crop years.
       (6) Payment acres.--The term ``payment acres'' means--
       (A) for the 2002 crop of peanuts, 85 percent of the average 
     acreage determined under section 1302(a)(2) for an historic 
     peanut producer; and
       (B) for the 2003 through 2007 crops of peanuts, 85 percent 
     of the base acres for peanuts assigned to a farm under 
     section 1302(b).
       (7) Payment yield.--The term ``payment yield'' means the 
     yield assigned to a farm by historic peanut producers 
     pursuant to section 1302(b).
       (8) Producer.--The term ``producer'' means an owner, 
     operator, landlord, tenant, or sharecropper that shares in 
     the risk of producing a crop on a farm and is entitled to 
     share in the crop available for marketing from the farm, or 
     would have shared had the crop been produced. In determining 
     whether a grower of hybrid seed is a producer, the Secretary 
     shall not take into consideration the existence of a hybrid 
     seed contract and shall ensure that program requirements do 
     not adversely affect the ability of the grower to receive a 
     payment under this subtitle.
       (9) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (10) State.--The term ``State'' means each of the several 
     States of the United States, the District of Columbia, the 
     Commonwealth of Puerto Rico, and any other territory or 
     possession of the United States.
       (11) Target price.--The term ``target price'' means the 
     price per ton of peanuts used to determine the payment rate 
     for counter-cyclical payments.
       (12) United states.--The term ``United States'', when used 
     in a geographical sense, means all of the States.

     SEC. 1302. ESTABLISHMENT OF PAYMENT YIELD AND BASE ACRES FOR 
                   PEANUTS FOR A FARM.

       (a) Average Yield and Acreage Average for Historic Peanut 
     Producers.--
       (1) Determination of average yield.--
       (A) In general.--The Secretary shall determine, for each 
     historic peanut producer, the average yield for peanuts on 
     each farm on which the historic peanut producer planted 
     peanuts for harvest for the 1998 through 2001 crop years, 
     excluding any crop year in which the producer did not plant 
     or was prevented from planting peanuts.
       (B) Assigned yields.--For the purposes of determining the 
     4-year average yield for an historic peanut producer under 
     this paragraph, the historic peanut producer may elect to 
     substitute for a farm, for not more than 3 of the 1998 
     through 2001 crop years in which the producer planted peanuts 
     on the farm, the average yield for peanuts produced in the 
     county in which the farm is located for the 1990 through 1997 
     crop years.
       (2) Determination of acreage average.--
       (A) In general.--The Secretary shall determine, for each 
     historic peanut producer, the 4-year average of the 
     following:
       (i) Acreage planted to peanuts on each farm on which the 
     historic peanut producer planted peanuts for harvest for the 
     1998 through 2001 crop years.
       (ii) Any acreage on each farm that the historic peanut 
     producer was prevented from planting to peanuts during the 
     1998 through 2001 crop years because of drought, flood, or 
     other natural disaster, or other condition beyond the control 
     of the historic peanut producer, as determined by the 
     Secretary.
       (B) Inclusion of all 4 years in average.--For the purposes 
     of determining the 4-year acreage average for an historic 
     peanut producer under this paragraph, the Secretary shall not 
     exclude any crop year in which the producer did not plant 
     peanuts.
       (C) Proportional shares.--If more than 1 historic peanut 
     producer shared in the risk of producing the crop on a farm, 
     the historic peanut producers shall receive their 
     proportional share of the number of acres planted (or 
     prevented from being planted) to peanuts for harvest on the 
     farm based on the sharing arrangement that was in effect 
     among the producers for the crop.
       (3) Time for determinations.--The Secretary shall make the 
     determinations required by this subsection as soon as 
     practicable after the date of enactment of this Act.
       (4) Special considerations.--In making the determinations 
     required by this subsection, the Secretary shall take into 
     account changes in the number, identity, or interest of 
     producers sharing in the risk of producing a peanut crop 
     since the 1998 crop year, including providing a method for 
     the assignment of average acres and average yield to a farm--
       (A) when an historic peanut producer is no longer living;
       (B) when an entity composed of historic peanut producers 
     has been dissolved; or
       (C) in other appropriate situations, as determined by the 
     Secretary.
       (b) Assignment of Average Yields and Average Acreage to 
     Farms.--
       (1) Assignment by historic peanut producers.--The Secretary 
     shall give each historic peanut producer an opportunity to 
     assign the average peanut yield and average acreage 
     determined under subsection (a) for each farm of the historic 
     peanut producer to cropland on that farm or another farm in 
     the same State or a contiguous State.
       (2) Limitation on acreage assignment.--Notwithstanding 
     paragraph (1), the average acreage determined under 
     subsection (a)(2) for a farm may not be assigned to a farm in 
     a contiguous State unless--
       (A) the historic peanut producer making the assignment 
     produced peanuts in that State during at least 1 of the 1998 
     through 2001 crop years; or
       (B) as of March 31, 2003, the historic peanut producer is a 
     producer on a farm in that State.
       (3) Notice of assignment opportunity.--The Secretary shall 
     provide notice to historic peanut producers regarding their 
     opportunity to assign average peanut yields and average 
     acreages to farms under paragraph (1). The notice shall 
     include the following:
       (A) Notice that the opportunity to make the assignments is 
     being provided only once.
       (B) A description of the limitation in paragraph (2) on 
     their ability to make the assignments.
       (C) Information regarding the manner in which the 
     assignments must be made and the time periods and manner in 
     which notice of the assignments must be submitted to the 
     Secretary.
       (4) Assignment deadlines.--Not later than March 31, 2003, 
     an historic peanut producer shall submit to the Secretary 
     notice of the assignments made by the producer under this 
     subsection. If an historic peanut producer fails to submit 
     the notice by that date, the notice shall be submitted in 
     such other manner as the Secretary may prescribe.
       (c) Payment Yield.--The average of all of the yields 
     assigned by historic peanut producers under subsection (b) to 
     a farm shall be considered to be the payment yield for that 
     farm for the purpose of making direct payments and counter-
     cyclical payments under this subtitle.
       (d) Base Acres for Peanuts.--Subject to subsection (e), the 
     total number of acres assigned by historic peanut producers 
     under subsection (b) to a farm shall be considered to be the 
     farm's base acres for peanuts for the purpose of making 
     direct payments and counter-cyclical payments under this 
     subtitle.
       (e) Treatment of Conservation Reserve Contract Acreage.--
       (1) In general.--The Secretary shall provide for an 
     adjustment, as appropriate, in the base

[[Page H1806]]

     acres for peanuts for a farm whenever either of the following 
     circumstances occur:
       (A) A conservation reserve contract entered into under 
     section 1231 of the Food Security Act of 1985 (16 U.S.C. 
     3831) with respect to the farm expires or is voluntarily 
     terminated.
       (B) Cropland is released from coverage under a conservation 
     reserve contract by the Secretary.
       (2) Special payment rules.--For the crop year in which a 
     base acres for peanuts adjustment under paragraph (1) is 
     first made, the owner of the farm shall elect to receive 
     either direct payments and counter-cyclical payments with 
     respect to the acreage added to the farm under this 
     subsection or a prorated payment under the conservation 
     reserve contract, but not both.
       (f) Prevention of Excess Base Acres for Peanuts.--
       (1) Required reduction.--If the sum of the base acres for 
     peanuts for a farm, together with the acreage described in 
     paragraph (2), exceeds the actual cropland acreage of the 
     farm, the Secretary shall reduce the base acres for peanuts 
     for the farm or the base acres for 1 or more covered 
     commodities under subtitle A for the farm so that the sum of 
     the base acres for peanuts and acreage described in paragraph 
     (2) does not exceed the actual cropland acreage of the farm.
       (2) Other acreage.--For purposes of paragraph (1), the 
     Secretary shall include the following:
       (A) Any base acres for the farm under subtitle A.
       (B) Any acreage on the farm enrolled in the conservation 
     reserve program or wetlands reserve program under chapter 1 
     of subtitle D of title XII of the Food Security Act of 1985 
     (16 U.S.C. 3830 et seq.).
       (C) Any other acreage on the farm enrolled in a 
     conservation program for which payments are made in exchange 
     for not producing an agricultural commodity on the acreage.
       (3) Selection of acres.--The Secretary shall give the owner 
     of the farm the opportunity to select the base acres for 
     peanuts or the subtitle A base acres against which the 
     reduction required by paragraph (1) will be made.
       (4) Exception for double-cropped acreage.--In applying 
     paragraph (1), the Secretary shall make an exception in the 
     case of double cropping, as determined by the Secretary.
       (5) Coordinated application of requirements.--The Secretary 
     shall take into account section 1101(g) when applying the 
     requirements of this subsection.
       (g) Permanent Reduction in Base Acres for Peanuts.--The 
     owner of a farm may reduce, at any time, the base acres for 
     peanuts assigned to the farm. The reduction shall be 
     permanent and made in the manner prescribed by the Secretary.

     SEC. 1303. AVAILABILITY OF DIRECT PAYMENTS FOR PEANUTS.

       (a) Payment Required.--
       (1) 2002 crop year.--For the 2002 crop year, the Secretary 
     shall make direct payments under this section to historic 
     peanut producers.
       (2) Subsequent crop years.--For each of the 2003 through 
     2007 crop years for peanuts, the Secretary shall make direct 
     payments to the producers on a farm to which a payment yield 
     and base acres for peanuts are assigned under section 1302.
       (b) Payment Rate.--The payment rate used to make direct 
     payments with respect to peanuts for a crop year shall be 
     equal to $36 per ton.
       (c) Payment Amount for 2002 Crop Year.--The amount of the 
     direct payment to be paid to an historic peanut producer for 
     the 2002 crop of peanuts shall be equal to the product of the 
     following:
       (1) The payment rate specified in subsection (b).
       (2) The payment acres of the historic peanut producer.
       (3) The average peanut yield determined under section 
     1302(a)(1) for the historic peanut producer.
       (d) Payment Amount for Subsequent Crop Years.--The amount 
     of the direct payment to be paid to the producers on a farm 
     for the 2003 through 2007 crops of peanuts shall be equal to 
     the product of the following:
       (1) The payment rate specified in subsection (b).
       (2) The payment acres on the farm.
       (3) The payment yield for the farm.
       (e) Time for Payment.--
       (1) In general.--The Secretary shall make direct payments--
       (A) in the case of the 2002 crop year, as soon as 
     practicable after the date of enactment of this Act; and
       (B) in the case of each of the 2003 through 2007 crop 
     years, not later than September 30 of the calendar year in 
     which the crop is harvested.
       (2) Advance payments.--At the option of the producers on a 
     farm, up to 50 percent of the direct payment for any of the 
     2003 through 2007 crop years shall be paid to the producers 
     in advance. The producers shall select the month within which 
     the advance payment for a crop year will be made. The month 
     selected may be any month during the period beginning on 
     December 1 of the calendar year before the calendar year in 
     which the crop is harvested through the month within which 
     the direct payment would otherwise be made. The producers may 
     change the selected month for a subsequent advance payment by 
     providing advance notice to the Secretary.
       (3) Repayment of advance payments.--If a producer on a farm 
     that receives an advance direct payment for a crop year 
     ceases to be a producer on that farm, or the extent to which 
     the producer shares in the risk of producing a crop changes, 
     before the date the remainder of the direct payment is made, 
     the producer shall be responsible for repaying the Secretary 
     the applicable amount of the advance payment, as determined 
     by the Secretary.

     SEC. 1304. AVAILABILITY OF COUNTER-CYCLICAL PAYMENTS FOR 
                   PEANUTS.

       (a) Payment Required.--
       (1) In general.--During the 2002 through 2007 crop years 
     for peanuts, the Secretary shall make counter-cyclical 
     payments under this section with respect to peanuts if the 
     Secretary determines that the effective price for peanuts is 
     less than the target price for peanuts.
       (2) 2002 crop year.--If counter-cyclical payments are 
     required for the 2002 crop year, the Secretary shall make the 
     payments to historic peanut producers.
       (3) Subsequent crop years.--If counter-cyclical payments 
     are required for any of the 2003 through 2007 crop years for 
     peanuts, the Secretary shall make the payments to the 
     producers on a farm to which a payment yield and base acres 
     for peanuts are assigned under section 1302.
       (b) Effective Price.--For purposes of subsection (a), the 
     effective price for peanuts is equal to the sum of the 
     following:
       (1) The higher of the following:
       (A) The national average market price for peanuts received 
     by producers during the 12-month marketing year for peanuts, 
     as determined by the Secretary.
       (B) The national average loan rate for a marketing 
     assistance loan for peanuts in effect for the applicable 
     period under this subtitle.
       (2) The payment rate in effect under section 1303 for the 
     purpose of making direct payments.
       (c) Target Price.--For purposes of subsection (a), the 
     target price for peanuts shall be equal to $495 per ton.
       (d) Payment Rate.--The payment rate used to make counter-
     cyclical payments for a crop year shall be equal to the 
     difference between--
       (1) the target price; and
       (2) the effective price determined under subsection (b).
       (e) Payment Amount for 2002 Crop Year.--If counter-cyclical 
     payments are required to be paid for the 2002 crop of 
     peanuts, the amount of the counter-cyclical payment to be 
     paid to an historic peanut producer for that crop year shall 
     be equal to the product of the following:
       (1) The payment rate specified in subsection (d).
       (2) The payment acres of the historic peanut producer.
       (3) The average peanut yield determined under section 
     1302(a)(1) for the historic peanut producer.
       (f) Payment Amount for Subsequent Crop Years.--If counter-
     cyclical payments are required to be paid for any of the 2003 
     through 2007 crops of peanuts, the amount of the counter-
     cyclical payment to be paid to the producers on a farm for 
     that crop year shall be equal to the product of the 
     following:
       (1) The payment rate specified in subsection (d).
       (2) The payment acres on the farm.
       (3) The payment yield for the farm.
       (g) Time for Payments.--
       (1) General rule.--If the Secretary determines under 
     subsection (a) that counter-cyclical payments are required to 
     be made under this section for a crop year, the Secretary 
     shall make the counter-cyclical payments as soon as 
     practicable after the end of the 12-month marketing year for 
     the crop.
       (2) Availability of partial payments.--If, before the end 
     of the 12-month marketing year, the Secretary estimates that 
     counter-cyclical payments will be required under this section 
     for a crop year, the Secretary shall give producers on a farm 
     (or, in the case of the 2002 crop year, historic peanut 
     producers) the option to receive partial payments of the 
     counter-cyclical payment projected to be made for that crop.
       (3) Time for partial payments.--
       (A) 2002 through 2006 crop years.--When the Secretary makes 
     partial payments available under paragraph (2) for any of the 
     2002 through 2006 crop years--
       (i) the first partial payment for the crop year shall be 
     made not earlier than October 1, and, to the maximum extent 
     practicable, not later than October 31, of the calendar year 
     in which the crop is harvested;
       (ii) the second partial payment shall be made not earlier 
     than February 1 of the next calendar year; and
       (iii) the final partial payment shall be made as soon as 
     practicable after the end of the 12-month marketing year for 
     that crop.
       (B) 2007 crop year.--When the Secretary makes partial 
     payments available for the 2007 crop year--
       (i) the first partial payment shall be made after 
     completion of the first 6 months of the marketing year for 
     that crop; and
       (ii) the final partial payment shall be made as soon as 
     practicable after the end of the 12-month marketing year for 
     that crop.
       (4) Amount of partial payments.--
       (A) 2002 crop year.--
       (i) First partial payment.--In the case of the 2002 crop 
     year, the first partial payment under paragraph (3) to an 
     historic peanut producer may not exceed 35 percent of the 
     projected counter-cyclical payment for the crop year, as 
     determined by the Secretary.
       (ii) Second partial payment.--The second partial payment 
     may not exceed the difference between--

       (I) 70 percent of the projected counter-cyclical payment 
     (including any revision thereof) for the 2002 crop year; and
       (II) the amount of the payment made under clause (i).

       (iii) Final payment.--The final payment shall be equal to 
     the difference between--

       (I) the actual counter-cyclical payment to be made to the 
     historic peanut producer; and
       (II) the amount of the partial payments made to the 
     historic peanut producer under clauses (i) and (ii).

[[Page H1807]]

       (B) 2003 through 2006 crop years.--
       (i) First partial payment.--For each of the 2003 through 
     2006 crop years, the first partial payment under paragraph 
     (3) to the producers on a farm may not exceed 35 percent of 
     the projected counter-cyclical payment for the crop year, as 
     determined by the Secretary.
       (ii) Second partial payment.--The second partial payment 
     for a crop year may not exceed the difference between--

       (I) 70 percent of the projected counter-cyclical payment 
     (including any revision thereof) for the crop year; and
       (II) the amount of the payment made under clause (i).

       (iii) Final payment.--The final payment for a crop year 
     shall be equal to the difference between--

       (I) the actual counter-cyclical payment to be made to the 
     producers for that crop year; and
       (II) the amount of the partial payments made to the 
     producers under clauses (i) and (ii) for that crop year.

       (C) 2007 crop year.--
       (i) First partial payment.--For the 2007 crop year, the 
     first partial payment under paragraph (3) to the producers on 
     a farm may not exceed 40 percent of the projected counter-
     cyclical payment for the crop year, as determined by the 
     Secretary.
       (ii) Final payment.--The final payment for the 2007 crop 
     year shall be equal to the difference between--

       (I) the actual counter-cyclical payment to be made to the 
     producers for that crop year; and
       (II) the amount of the partial payment made to the 
     producers under clause (i).

       (5) Repayment.--The producers on a farm (or, in the case of 
     the 2002 crop year, historic peanut producers) that receive a 
     partial payment under this subsection for a crop year shall 
     repay to the Secretary the amount, if any, by which the total 
     of the partial payments exceed the actual counter-cyclical 
     payment to be made for that crop year.

     SEC. 1305. PRODUCER AGREEMENT REQUIRED AS CONDITION ON 
                   PROVISION OF DIRECT PAYMENTS AND COUNTER-
                   CYCLICAL PAYMENTS.

       (a) Compliance With Certain Requirements.--
       (1) Requirements.--Before the producers on a farm may 
     receive direct payments or counter-cyclical payments under 
     this subtitle with respect to the farm, the producers shall 
     agree, during the crop year for which the payments are made 
     and in exchange for the payments--
       (A) to comply with applicable conservation requirements 
     under subtitle B of title XII of the Food Security Act of 
     1985 (16 U.S.C. 3811 et seq.);
       (B) to comply with applicable wetland protection 
     requirements under subtitle C of title XII of that Act (16 
     U.S.C. 3821 et seq.);
       (C) to comply with the planting flexibility requirements of 
     section 1306;
       (D) to use the land on the farm, in a quantity equal to the 
     attributable base acres for peanuts and any base acres for 
     the farm under subtitle A, for an agricultural or conserving 
     use, and not for a nonagricultural commercial or industrial 
     use, as determined by the Secretary; and
       (E) to effectively control noxious weeds and otherwise 
     maintain the land in accordance with sound agricultural 
     practices, as determined by the Secretary, if the 
     agricultural or conserving use involves the noncultivation of 
     any portion of the land referred to in subparagraph (D).
       (2) Compliance.--The Secretary may issue such rules as the 
     Secretary considers necessary to ensure producer compliance 
     with the requirements of paragraph (1).
       (3) Modification.--At the request of the transferee or 
     owner, the Secretary may modify the requirements of this 
     subsection if the modifications are consistent with the 
     objectives of this subsection, as determined by the 
     Secretary.
       (b) Transfer or Change of Interest in Farm.--
       (1) Termination.--Except as provided in paragraph (2), a 
     transfer of (or change in) the interest of the producers on a 
     farm in the base acres for peanuts for which direct payments 
     or counter-cyclical payments are made shall result in the 
     termination of the payments with respect to those acres, 
     unless the transferee or owner of the acreage agrees to 
     assume all obligations under subsection (a). The termination 
     shall take effect on the date determined by the Secretary.
       (2) Exception.--If a producer entitled to a direct payment 
     or counter-cyclical payment dies, becomes incompetent, or is 
     otherwise unable to receive the payment, the Secretary shall 
     make the payment, in accordance with rules issued by the 
     Secretary.
       (c) Acreage Reports.--As a condition on the receipt of 
     direct payments, counter-cyclical payments, marketing 
     assistance loans, or loan deficiency payments under this 
     subtitle, the Secretary shall require the producers on a farm 
     to which a payment yield and base acres for peanuts are 
     assigned under section 1302 to submit to the Secretary annual 
     acreage reports with respect to all cropland on the farm.
       (d) Tenants and Sharecroppers.--In carrying out this 
     subtitle, the Secretary shall provide adequate safeguards to 
     protect the interests of tenants and sharecroppers.
       (e) Sharing of Payments.--The Secretary shall provide for 
     the sharing of direct payments and counter-cyclical payments 
     among the producers on a farm on a fair and equitable basis.

     SEC. 1306. PLANTING FLEXIBILITY.

       (a) Permitted Crops.--Subject to subsection (b), any 
     commodity or crop may be planted on the base acres for 
     peanuts on a farm.
       (b) Limitations Regarding Certain Commodities.--
       (1) General limitation.--The planting of an agricultural 
     commodity specified in paragraph (2) shall be prohibited on 
     base acres for peanuts unless the commodity, if planted, is 
     destroyed before harvest.
       (2) Treatment of trees and other perennials.--The planting 
     of an agricultural commodity specified in paragraph (3) that 
     is produced on a tree or other perennial plant shall be 
     prohibited on base acres for peanuts.
       (3) Covered agricultural commodities.--Paragraphs (1) and 
     (2) apply to the following agricultural commodities:
       (A) Fruits.
       (B) Vegetables (other than lentils, mung beans, and dry 
     peas).
       (C) Wild rice.
       (c) Exceptions.--Paragraphs (1) and (2) of subsection (b) 
     shall not limit the planting of an agricultural commodity 
     specified in paragraph (3) of that subsection--
       (1) in any region in which there is a history of double-
     cropping of peanuts with agricultural commodities specified 
     in subsection (b)(3), as determined by the Secretary, in 
     which case the double-cropping shall be permitted;
       (2) on a farm that the Secretary determines has a history 
     of planting agricultural commodities specified in subsection 
     (b)(3) on the base acres for peanuts, except that direct 
     payments and counter-cyclical payments shall be reduced by an 
     acre for each acre planted to such an agricultural commodity; 
     or
       (3) by the producers on a farm that the Secretary 
     determines has an established planting history of a specific 
     agricultural commodity specified in subsection (b)(3), except 
     that--
       (A) the quantity planted may not exceed the average annual 
     planting history of such agricultural commodity by the 
     producers on the farm in the 1991 through 1995 or 1998 
     through 2001 crop years (excluding any crop year in which no 
     plantings were made), as determined by the Secretary; and
       (B) direct payments and counter-cyclical payments shall be 
     reduced by an acre for each acre planted to such agricultural 
     commodity.

     SEC. 1307. MARKETING ASSISTANCE LOANS AND LOAN DEFICIENCY 
                   PAYMENTS FOR PEANUTS.

       (a) Nonrecourse Loans Available.--
       (1) Availability.--For each of the 2002 through 2007 crops 
     of peanuts, the Secretary shall make available to producers 
     on a farm nonrecourse marketing assistance loans for peanuts 
     produced on the farm. The loans shall be made under terms and 
     conditions that are prescribed by the Secretary and at the 
     loan rate established under subsection (b).
       (2) Eligible production.--The producers on a farm shall be 
     eligible for a marketing assistance loan under this 
     subsection for any quantity of peanuts produced on the farm.
       (3) Treatment of certain commingled commodities.--In 
     carrying out this subsection, the Secretary shall make loans 
     to producers on a farm that would be eligible to obtain a 
     marketing assistance loan, but for the fact the peanuts owned 
     by the producers on the farm are commingled with other 
     peanuts in facilities unlicensed for the storage of 
     agricultural commodities by the Secretary or a State 
     licensing authority, if the producers obtaining the loan 
     agree to immediately redeem the loan collateral in accordance 
     with section 166 of the Federal Agriculture Improvement and 
     Reform Act of 1996 (7 U.S.C. 7286).
       (4) Options for obtaining loan.--A marketing assistance 
     loan under this subsection, and loan deficiency payments 
     under subsection (e), may be obtained at the option of the 
     producers on a farm through--
       (A) a designated marketing association or marketing 
     cooperative of producers that is approved by the Secretary; 
     or
       (B) the Farm Service Agency.
       (5) Storage of loan peanuts.--As a condition on the 
     Secretary's approval of an individual or entity to provide 
     storage for peanuts for which a marketing assistance loan is 
     made under this section, the individual or entity shall 
     agree--
       (A) to provide such storage on a nondiscriminatory basis; 
     and
       (B) to comply with such additional requirements as the 
     Secretary considers appropriate to accomplish the purposes of 
     this section and promote fairness in the administration of 
     the benefits of this section.
       (6) Payment of peanut storage costs.--Effective for the 
     2002 through 2006 crops of peanuts, to ensure proper storage 
     of peanuts for which a loan is made under this section, the 
     Secretary shall use the funds of the Commodity Credit 
     Corporation to pay storage, handling, and other associated 
     costs. This authority terminates beginning with the 2007 crop 
     of peanuts.
       (7) Marketing.--A marketing association or cooperative may 
     market peanuts for which a loan is made under this section in 
     any manner that conforms to consumer needs, including the 
     separation of peanuts by type and quality.
       (b) Loan Rate.--The loan rate for a marketing assistance 
     loan under for peanuts subsection (a) shall be equal to $355 
     per ton.
       (c) Term of Loan.--
       (1) In general.--A marketing assistance loan for peanuts 
     under subsection (a) shall have a term of 9 months beginning 
     on the first day of the first month after the month in which 
     the loan is made.
       (2) Extensions prohibited.--The Secretary may not extend 
     the term of a marketing assistance loan for peanuts under 
     subsection (a).
       (d) Repayment Rate.--
       (1) In general.--The Secretary shall permit producers on a 
     farm to repay a marketing assistance loan for peanuts under 
     subsection (a) at a rate that is the lesser of--
       (A) the loan rate established for peanuts under subsection 
     (b), plus interest (determined in accordance with section 163 
     of the Federal Agriculture Improvement and Reform Act of 1996 
     (7 U.S.C. 7283)); or
       (B) a rate that the Secretary determines will--

[[Page H1808]]

       (i) minimize potential loan forfeitures;
       (ii) minimize the accumulation of stocks of peanuts by the 
     Federal Government;
       (iii) minimize the cost incurred by the Federal Government 
     in storing peanuts; and
       (iv) allow peanuts produced in the United States to be 
     marketed freely and competitively, both domestically and 
     internationally.
       (2) Good faith exception to beneficial interest 
     requirement.--For the 2002 crop year only, in the case of the 
     producers on a farm that marketed or otherwise lost 
     beneficial interest in the peanuts for which a marketing 
     assistance loan was made under this section before repaying 
     the loan, the Secretary shall permit the producers to repay 
     the loan at the applicable repayment rate that was in effect 
     for peanuts under this subsection on the date that the 
     producers lost beneficial interest, as determined by the 
     Secretary, if the Secretary determines the producers acted in 
     good faith.
       (e) Loan Deficiency Payments.--
       (1) Availability.--The Secretary may make loan deficiency 
     payments available to producers on a farm that, although 
     eligible to obtain a marketing assistance loan for peanuts 
     under subsection (a), agree to forgo obtaining the loan for 
     the peanuts in return for loan deficiency payments under this 
     subsection.
       (2) Computation.--A loan deficiency payment under this 
     subsection shall be computed by multiplying--
       (A) the payment rate determined under paragraph (3) for 
     peanuts; by
       (B) the quantity of the peanuts produced by the producers, 
     excluding any quantity for which the producers obtain a 
     marketing assistance loan under subsection (a).
       (3) Payment rate.--For purposes of this subsection, the 
     payment rate shall be the amount by which--
       (A) the loan rate established under subsection (b); exceeds
       (B) the rate at which a loan may be repaid under subsection 
     (d).
       (4) Effective date for payment rate determination.--
       (A) In general.--The Secretary shall determine the amount 
     of the loan deficiency payment to be made under this 
     subsection to the producers on a farm with respect to a 
     quantity of peanuts using the payment rate in effect under 
     paragraph (3) as of the date the producers request the 
     payment.
       (B) Special rule for 2002 crop year.--For the 2002 crop 
     year only, the Secretary shall determine the amount of the 
     loan deficiency payment to be made under this subsection to 
     the producers on a farm with respect to a quantity of peanuts 
     using the payment rate in effect under paragraph (3) as of 
     the earlier of the following:
       (i) The date on which the producers marketed or otherwise 
     lost beneficial interest in the crop, as determined by the 
     Secretary.
       (ii) The date the producers request the payment.
       (f) Compliance With Conservation and Wetlands 
     Requirements.--As a condition of the receipt of a marketing 
     assistance loan under subsection (a), the producer shall 
     comply with applicable conservation requirements under 
     subtitle B of title XII of the Food Security Act of 1985 (16 
     U.S.C. 3811 et seq.) and applicable wetland protection 
     requirements under subtitle C of title XII of that Act (16 
     U.S.C. 3821 et seq.) during the term of the loan.
       (g) Reimbursable Agreements and Payment of Administrative 
     Expenses.--The Secretary may implement any reimbursable 
     agreements or provide for the payment of administrative 
     expenses under this subtitle only in a manner that is 
     consistent with such activities in regard to other 
     commodities.

     SEC. 1308. MISCELLANEOUS PROVISIONS.

       (a) Mandatory Inspection.--All peanuts marketed in the 
     United States shall be officially inspected and graded by 
     Federal or Federal-State inspectors.
       (b) Termination of Peanut Administrative Committee.--The 
     Peanut Administrative Committee established under Marketing 
     Agreement No. 146 issued pursuant to the Agricultural 
     Adjustment Act (7 U.S.C. 601 et seq.), reenacted with 
     amendments by the Agricultural Marketing Agreement Act of 
     1937, is terminated.
       (c) Peanut Standards Board.--
       (1) Establishment and purpose.--The Secretary shall 
     establish a Peanut Standards Board for the purpose of 
     advising the Secretary regarding the establishment of quality 
     and handling standards for domestically produced and imported 
     peanuts.
       (2) Membership and appointment.--
       (A) Total members.--The Board shall consist of 18 members, 
     with representation equally divided between peanut producers 
     and peanut industry representatives.
       (B) Appointment process for producers.--The Secretary shall 
     appoint--
       (i) 3 producers from the Southeast (Alabama, Georgia, and 
     Florida) peanut producing region;
       (ii) 3 producers from the Southwest (Texas, Oklahoma, and 
     New Mexico) peanut producing region; and
       (iii) 3 producers from the Virginia/Carolina (Virginia and 
     North Carolina) peanut producing region.
       (C) Appointment process for industry representatives.--The 
     Secretary shall appoint 3 peanut industry representatives 
     from each of the 3 peanut producing regions in the United 
     States.
       (3) Terms.--
       (A) In general.--A member of the Board shall serve a 3-year 
     term.
       (B) Initial appointment.--In making the initial 
     appointments to the Board, the Secretary shall stagger the 
     terms of the members so that--
       (i) 1 producer member and peanut industry member from each 
     peanut producing region serves a 1-year term;
       (ii) 1 producer member and peanut industry member from each 
     peanut producing region serves a 2-year term; and
       (iii) 1 producer member and peanut industry member from 
     each peanut producing region serves a 3-year term.
       (4) Consultation required.--The Secretary shall consult 
     with the Board in advance whenever the Secretary establishes 
     or changes, or considers the establishment of or a change to, 
     quality and handling standards for peanuts.
       (5) Federal advisory committee act.--The Federal Advisory 
     Committee Act (5 U.S.C. App.) shall not apply to the Board.
       (d) Priority.--The Secretary shall make identifying and 
     combating the presence of all quality concerns related to 
     peanuts a priority in the development of quality and handling 
     standards for peanuts and in the inspection of domestically 
     produced and imported peanuts. The Secretary shall consult 
     with appropriate Federal and State agencies to provide 
     adequate safeguards against all quality concerns related to 
     peanuts.
       (e) Consistent Standards.--Imported peanuts shall be 
     subject to the same quality and handling standards as apply 
     to domestically produced peanuts.
       (f) Authorization of Appropriations.--
       (1) In general.--In addition to other funds that are 
     available to carry out this section, there is authorized to 
     be appropriated such sums as are necessary to carry out this 
     section.
       (2) Treatment of board expenses.--The expenses of the 
     Peanut Standards Board shall not be counted toward any 
     general limitation on the expenses of advisory committees, 
     panels, commissions, and task forces of the Department of 
     Agriculture, whether enacted before, on, or after the date of 
     enactment of this Act, unless the limitation specifically 
     refers to this paragraph and specifically includes the Peanut 
     Standards Board within the general limitation.
       (g) Transition Rule.--
       (1) Temporary designation of peanut administrative 
     committee members.--Notwithstanding the appointment process 
     specified in subsection (c) for the Peanut Standards Board, 
     during the transition period, the Secretary may designate 
     persons serving as members of the Peanut Administrative 
     Committee on the day before the date of enactment of this Act 
     to serve as members of the Peanut Standards Board for the 
     purpose of carrying out the duties of the Board described in 
     this section.
       (2) Funds.--The Secretary may transfer any funds available 
     to carry out the activities of the Peanut Administrative 
     Committee to the Peanut Standards Board to carry out the 
     duties of the Board described in this section.
       (3) Transition period.--In paragraph (1), the term 
     ``transition period'' means the period beginning on the date 
     of enactment of this Act and ending on the earlier of--
       (A) the date the Secretary appoints the members of the 
     Peanut Standards Board pursuant to subsection (c); or
       (B) 180 days after the date of enactment of this Act.
       (h) Effective Date.--This section shall take effect with 
     the 2002 crop of peanuts.

     SEC. 1309. TERMINATION OF MARKETING QUOTA PROGRAMS FOR 
                   PEANUTS AND COMPENSATION TO PEANUT QUOTA 
                   HOLDERS FOR LOSS OF QUOTA ASSET VALUE.

       (a) Repeal of Marketing Quota.--
       (1) Repeal.--Part VI of subtitle B of title III of the 
     Agricultural Adjustment Act of 1938 (7 U.S.C. 1357-1359a), 
     relating to peanuts, is repealed.
       (2) Treatment of 2001 crop.--Part VI of subtitle B of title 
     III of the Agricultural Adjustment Act of 1938 (7 U.S.C. 
     1357-1359a), as in effect on the day before the date of 
     enactment of this Act, shall continue to apply with respect 
     to the 2001 crop of peanuts notwithstanding the amendment 
     made by paragraph (1). Section 1308(g)(2) shall also apply to 
     the 2001 crop of peanuts.
       (b) Compensation Contract Required.--
       (1) In general.--The Secretary shall offer to enter into a 
     contract with each person that the Secretary determines is an 
     eligible peanut quota holder under subsection (f) for the 
     purpose of providing compensation for the lost value of the 
     quota on account of the repeal of the marketing quota program 
     for peanuts under subsection (a).
       (2) Payment period.--The Secretary shall make payments 
     under the contracts during fiscal years 2002 through 2006.
       (c) Time for Payment.--
       (1) Payment in installments.--The payments required under 
     the contracts shall be provided in 5 equal installments not 
     later than September 30 of each of fiscal years 2002 through 
     2006.
       (2) Single payment.--At the request of an eligible peanut 
     quota holder entitled to payments under a contract, the 
     Secretary shall provide the entire payment amount determined 
     under subsection (d) with respect to the eligible peanut 
     quota holder for the 5 fiscal years in a single lump sum 
     during the fiscal year specified by the eligible peanut quota 
     holder.
       (d) Payment Amount.--The amount of the payment for a fiscal 
     year to an eligible peanut quota holder under a contract 
     shall be equal to the product obtained by multiplying--
       (1) $0.11 per pound; by
       (2) the number of pounds of quota with respect to which the 
     person qualifies as a peanut quota holder under subsection 
     (f).
       (e) Assignment of Payments.--The provisions of section 8(g) 
     of the Soil Conservation and Domestic Allotment Act (16 
     U.S.C. 590h(g)), relating to assignment of payments, shall 
     apply to the payments made under the contracts. A person 
     making an assignment of the payment, or the assignee, shall 
     provide the Secretary with notice, in such manner as the 
     Secretary may require, of any assignment made under this 
     subsection.

[[Page H1809]]

       (f) Eligible Peanut Quota Holder.--
       (1) In general.--Except as otherwise provided in this 
     subsection, the Secretary shall consider a person to be an 
     eligible peanut quota holder for the purposes of this section 
     if the person, as of the date of enactment of this Act, owned 
     a farm that, also as of that date, was eligible for a 
     permanent peanut quota under section 358-1(b) of the 
     Agricultural Adjustment Act of 1938 (7 U.S.C. 1358-1(b)), 
     irrespective of temporary leases, transfers of quotas for 
     seed, or quotas for experimental purposes.
       (2) Effect of purchase contract.--If there was a written 
     contract for the purchase of all or a portion of a farm 
     described in paragraph (1) as of the date of enactment of 
     this Act and the parties to the sale are unable to agree to 
     the disposition of eligibility for payments under this 
     section, the Secretary, taking into account any incomplete 
     permanent transfer of quota that has otherwise been agreed 
     to, shall provide for the equitable division of the payments 
     among the parties by adjusting the determination of who is 
     the eligible peanut quota holder with respect to particular 
     pounds of the quota.
       (3) Effect of agreement for permanent quota transfer.--If 
     the Secretary determines that there was in existence, as of 
     the date of enactment of this Act, an agreement for the 
     permanent transfer of quota, but that the transfer was not 
     completed by that date, the Secretary shall consider the 
     peanut quota holder to be the party to the agreement who, as 
     of that date, was the owner of the farm to which the quota 
     was to be transferred.
       (4) Protected bases.--A person that owns a farm with a 
     peanut poundage quota which is protected under a conservation 
     reserve program contract entered into under section 1231 of 
     the Food Security Act of 1985 (16 U.S.C. 3831) shall be 
     considered to be an eligible quota holder with respect to the 
     protected poundage.
       (5) Secretarial discretion.--Notwithstanding the preceding 
     paragraphs, the Secretary may declare a person to be the 
     eligible peanut quota holder with respect to certain pounds 
     of quota or otherwise for purposes of this section if the 
     Secretary considers the declaration is needed to insure a 
     fair and equitable administration of the payments provided 
     for in this section, so long as the Secretary does not, in 
     exercising this authority, effectively increase the total 
     quota in excess of the quota that was available to all 
     producers for the 2001 crop year for other than seed or 
     experimental use.
       (6) Limitation on quantity of quota held.--A person shall 
     be considered an eligible peanut quota holder for purposes of 
     this section only with respect to that number of permanent 
     pounds that qualifies the person as a peanut quota holder 
     under one of the preceding paragraphs. The determination of 
     the peanut poundage amount for which the person qualifies 
     shall be made based on the 2001 crop quota levels and 
     shall take into account sales of the farm that occurred 
     before the date of enactment of this Act and any permanent 
     transfers of quota that took place before that date, 
     consistent with the preceding paragraphs. The Secretary 
     shall not take into account, or allow eligibility for, 
     quotas for seed, granted as experimental quotas, or 
     obtained by temporary lease or transfer.
       (g) Successions in Payment Eligibility and Attachment of 
     Eligibility to Persons.--
       (1) Eligibility attaches to persons.--Once a person is 
     eligible for payments under this section, as determined under 
     subsection (f), the continued eligibility of the person for 
     the payments does not run with a farm, but shall remain with 
     the person for the term of this section irrespective of 
     whether the person sells, or continues to have an interest 
     in, the farm that had the quota that qualified the person as 
     an eligible peanut quota holder under subsection (f) and 
     irrespective of whether the person has a continuing interest 
     in the production of peanuts.
       (2) Succession.--If a person eligible for payments under 
     this section dies, in the case of an individual, or ceases to 
     exist, in the case of other persons, the payment eligibility 
     of the person shall pass to the person's personal or 
     organizational successor, as determined by the Secretary.
       (h) Conforming Amendments.--
       (1) Administrative provisions.--Section 361 of the 
     Agricultural Adjustment Act of 1938 (7 U.S.C. 1361) is 
     amended by striking ``peanuts,''.
       (2) Adjustment of quotas.--Section 371 of the Agricultural 
     Adjustment Act of 1938 (7 U.S.C. 1371) is amended--
       (A) in the first sentence of subsection (a), by striking 
     ``peanuts,''; and
       (B) in the first sentence of subsection (b), by striking 
     ``peanuts''.
       (3) Reports and records.--Section 373 of the Agricultural 
     Adjustment Act of 1938 (7 U.S.C. 1373) is amended--
       (A) in the first sentence of subsection (a)--
       (i) by striking ``peanuts,'' each place it appears;
       (ii) by inserting ``and'' after ``from producers,''; and
       (iii) by striking ``for producers, all'' and all that 
     follows through the period at the end of the sentence and 
     inserting ``for producers.''; and
       (B) in subsection (b), by striking ``peanuts,''.
       (4) Eminent domain.--Section 378(c) of the Agricultural 
     Adjustment Act of 1938 (7 U.S.C. 1378(c)) is amended in the 
     first sentence--
       (A) by striking ``cotton,'' and inserting ``cotton and''; 
     and
       (B) by striking ``and peanuts,''.

     SEC. 1310. REPEAL OF SUPERSEDED PRICE SUPPORT AUTHORITY AND 
                   EFFECT OF REPEAL.

       (a) Repeal of Price Support Authority.--
       (1) In general.--Section 155 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7271) is 
     repealed.
       (2) Conforming amendments.--The Agricultural Act of 1949 (7 
     U.S.C. 1441 et seq.) is amended--
       (A) in section 101(b) (7 U.S.C. 1441(b)), by striking ``and 
     peanuts''; and
       (B) in section 408(c) (7 U.S.C. 1428(c)), by striking 
     ``peanuts,''.
       (3) Technical amendment.--The chapter heading of chapter 2 
     of subtitle D of the Federal Agriculture Improvement and 
     Reform Act of 1996 (7 U.S.C. prec. 7271) is amended by 
     striking ``PEANUTS AND''.
       (b) Disposal.--Notwithstanding any other provision of law 
     or previous declaration made by the Secretary, the Secretary 
     shall ensure that the disposal of all peanuts for which a 
     loan for the 2001 crop of peanuts was made under section 155 
     of the Federal Agriculture Improvement and Reform Act of 1996 
     (7 U.S.C. 7271) before the date of enactment of this Act is 
     carried out in a manner that prevents price disruptions in 
     the domestic and international markets for peanuts.
       (c) Treatment of Crop Insurance Policies for 2002 Crop 
     Year.--
       (1) Applicability.--This subsection shall apply for the 
     2002 crop year only notwithstanding any other provision of 
     law or crop insurance policy.
       (2) Price election.--The nonquota price election for 
     segregation I, II, and III peanuts shall be 17.75 cents per 
     pound and shall be used for all aspects of the policy 
     relating to the calculations of premium, liability, and 
     indemnities.
       (3) Quality Adjustment.--For the purposes of quality 
     adjustment only, the average support price per pound of 
     peanuts shall be a price equal to 17.75 cents per pound. 
     Quality under the crop insurance policy for peanuts shall be 
     adjusted under procedures issued by the Federal Crop 
     Insurance Corporation.
                           Subtitle D--Sugar

     SEC. 1401. SUGAR PROGRAM.

       (a) Extension and Modification of Existing Sugar Program.--
     Section 156 of the Federal Agriculture Improvement and Reform 
     Act of 1996 (7 U.S.C. 7272) is amended to read as follows:

     ``SEC. 156. SUGAR PROGRAM.

       ``(a) Sugarcane.--The Secretary shall make loans available 
     to processors of domestically grown sugarcane at a rate equal 
     to 18 cents per pound for raw cane sugar.
       ``(b) Sugar Beets.--The Secretary shall make loans 
     available to processors of domestically grown sugar beets at 
     a rate equal to 22.9 cents per pound for refined beet sugar.
       ``(c) Loan Rate Adjustments.--
       ``(1) In general.--The Secretary may reduce the loan rate 
     specified in subsection (a) for domestically grown sugarcane 
     and subsection (b) for domestically grown sugar beets if the 
     Secretary determines that negotiated reductions in export 
     subsidies and domestic subsidies provided for sugar of other 
     major sugar growing, producing, and exporting countries in 
     the aggregate exceed the commitments made as part of the 
     Agreement on Agriculture.
       ``(2) Extent of reduction.--The Secretary shall not reduce 
     the loan rate under subsection (a) or (b) below a rate that 
     provides an equal measure of support to that provided by 
     other major sugar growing, producing, and exporting 
     countries, based on an examination of both domestic and 
     export subsidies subject to reduction in the Agreement on 
     Agriculture.
       ``(3) Announcement of reduction.--The Secretary shall 
     announce any loan rate reduction to be made under this 
     subsection as far in advance as is practicable.
       ``(4) Definitions.--In this subsection:
       ``(A) Agreement on agriculture.--The term ``Agreement on 
     Agriculture'' means the Agreement on Agriculture referred to 
     in section 101(d)(2) of the Uruguay Round Agreements Act (19 
     U.S.C. 3511(d)(2)), or any amendatory or successor agreement.
       ``(B) Major sugar countries.--The term ``major sugar 
     growing, producing, and exporting countries'' means--
       ``(i) the countries of the European Union; and
       ``(ii) the 10 foreign countries not covered by subparagraph 
     (A) that the Secretary determines produce the greatest 
     quantity of sugar.
       ``(d) Term of Loans.--
       ``(1) In general.--A loan under this section during any 
     fiscal year shall be made available not earlier than the 
     beginning of the fiscal year and shall mature at the earlier 
     of--
       ``(A) the end of the 9-month period beginning on the first 
     day of the first month after the month in which the loan is 
     made; or
       ``(B) the end of the fiscal year in which the loan is made.
       ``(2) Supplemental loans.--In the case of a loan made under 
     this section in the last 3 months of a fiscal year, the 
     processor may repledge the sugar as collateral for a second 
     loan in the subsequent fiscal year, except that the second 
     loan shall--
       ``(A) be made at the loan rate in effect at the time the 
     second loan is made; and
       ``(B) mature in 9 months less the quantity of time that the 
     first loan was in effect.
       ``(e) Loan Type; Processor Assurances.--
       ``(1) Nonrecourse loans.--The Secretary shall carry out 
     this section through the use of nonrecourse loans.
       ``(2) Processor assurances.--
       ``(A) In general.--The Secretary shall obtain from each 
     processor that receives a loan under this section such 
     assurances as the Secretary considers adequate to ensure that 
     the processor will provide payments to producers that are 
     proportional to the value of the loan received by the 
     processor for the sugar beets and sugarcane delivered by 
     producers to the processor.
       ``(B) Minimum payments.--
       ``(i) In general.--Subject to clause (ii), the Secretary 
     may establish appropriate minimum payments for purposes of 
     this paragraph.
       ``(ii) Limitation.--In the case of sugar beets, the minimum 
     payment established under clause (i) shall not exceed the 
     rate of payment provided for under the applicable contract 
     between a sugar beet producer and a sugar beet processor.

[[Page H1810]]

       ``(iii) Effect of disaster.--The Secretary may not bar a 
     beet sugar processor from eligibility to obtain a loan under 
     this section because of the failure of the processor to 
     provide the appropriate minimum payment established under 
     this subsection if the failure--

       ``(I) occurred during a crop year prior to the date of 
     enactment of the Farm Security and Rural Investment Act of 
     2002; and
       ``(II) was related, at least in part, to the effects of a 
     natural disaster, including damage from freeze.

       ``(3) Administration.--The Secretary may not impose or 
     enforce any prenotification requirement, or similar 
     administrative requirement not otherwise in effect on the 
     date of enactment of the Farm Security and Rural Investment 
     Act of 2002, that has the effect of preventing a processor 
     from electing to forfeit the loan collateral (of an 
     acceptable grade and quality) on the maturity of the loan.
       ``(f) Loans for In-Process Sugar.--
       ``(1) Definition of in-process sugars and syrups.--In this 
     subsection, the term `in-process sugars and syrups' does not 
     include raw sugar, liquid sugar, invert sugar, invert syrup, 
     or other finished product that is otherwise eligible for a 
     loan under subsection (a) or (b).
       ``(2) Availability.--The Secretary shall make nonrecourse 
     loans available to processors of a crop of domestically grown 
     sugarcane and sugar beets for in-process sugars and syrups 
     derived from the crop.
       ``(3) Loan rate.--The loan rate shall be equal to 80 
     percent of the loan rate applicable to raw cane sugar or 
     refined beet sugar, as determined by the Secretary on the 
     basis of the source material for the in-process sugars and 
     syrups.
       ``(4) Further processing on forfeiture.--
       ``(A) In general.--As a condition of the forfeiture of in-
     process sugars and syrups serving as collateral for a loan 
     under paragraph (2), the processor shall, within such 
     reasonable time period as the Secretary may prescribe and at 
     no cost to the Commodity Credit Corporation, convert the in-
     process sugars and syrups into raw cane sugar or refined beet 
     sugar of acceptable grade and quality for sugars eligible for 
     loans under subsection (a) or (b).
       ``(B) Transfer to corporation.--Once the in-process sugars 
     and syrups are fully processed into raw cane sugar or refined 
     beet sugar, the processor shall transfer the sugar to the 
     Commodity Credit Corporation.
       ``(C) Payment to processor.--On transfer of the sugar, the 
     Secretary shall make a payment to the processor in an amount 
     equal to the amount obtained by multiplying--
       ``(i) the difference between--

       ``(I) the loan rate for raw cane sugar or refined beet 
     sugar, as appropriate; and
       ``(II) the loan rate the processor received under paragraph 
     (3); by

       ``(ii) the quantity of sugar transferred to the Secretary.
       ``(5) Loan conversion.--If the processor does not forfeit 
     the collateral as described in paragraph (4), but instead 
     further processes the in-process sugars and syrups into raw 
     cane sugar or refined beet sugar and repays the loan on the 
     in-process sugars and syrups, the processor may obtain a loan 
     under subsection (a) or (b) for the raw cane sugar or refined 
     beet sugar, as appropriate.
       ``(6) Term of loan.--The term of a loan made under this 
     subsection for a quantity of in-process sugars and syrups, 
     when combined with the term of a loan made with respect to 
     the raw cane sugar or refined beet sugar derived from the in-
     process sugars and syrups, may not exceed 9 months, 
     consistent with subsection (d).
       ``(g) Avoiding Forfeitures; Corporation Inventory 
     Disposition.--
       ``(1) In general.--Subject to subsection (e)(3), to the 
     maximum extent practicable, the Secretary shall operate the 
     program established under this section at no cost to the 
     Federal Government by avoiding the forfeiture of sugar to the 
     Commodity Credit Corporation.
       ``(2) Inventory disposition.--
       ``(A) In general.--To carry out paragraph (1), the 
     Commodity Credit Corporation may accept bids to obtain raw 
     cane sugar or refined beet sugar in the inventory of the 
     Commodity Credit Corporation from (or otherwise make 
     available such commodities, on appropriate terms and 
     conditions, to) processors of sugarcane and processors of 
     sugar beets (acting in conjunction with the producers of the 
     sugarcane or sugar beets processed by the processors) in 
     return for the reduction of production of raw cane sugar or 
     refined beet sugar, as appropriate.
       ``(B) Additional authority.--The authority provided under 
     this paragraph is in addition to any authority of the 
     Commodity Credit Corporation under any other law.
       ``(h) Information Reporting.--
       ``(1) Duty of processors and refiners to report.--A 
     sugarcane processor, cane sugar refiner, and sugar beet 
     processor shall furnish the Secretary, on a monthly basis, 
     such information as the Secretary may require to administer 
     sugar programs, including the quantity of purchases of 
     sugarcane, sugar beets, and sugar, and production, 
     importation, distribution, and stock levels of sugar.
       ``(2) Duty of producers to report.--
       ``(A) Proportionate share states.--As a condition of a loan 
     made to a processor for the benefit of a producer, the 
     Secretary shall require each producer of sugarcane located in 
     a State (other than the Commonwealth of Puerto Rico) in which 
     there are in excess of 250 producers of sugarcane to report, 
     in the manner prescribed by the Secretary, the sugarcane 
     yields and acres planted to sugarcane of the producer.
       ``(B) Other states.--The Secretary may require each 
     producer of sugarcane or sugar beets not covered by 
     subparagraph (A) to report, in a manner prescribed by the 
     Secretary, the yields of, and acres planted to, sugarcane or 
     sugar beets, respectively, of the producer.
       ``(3) Duty of importers to report.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the Secretary shall require an importer of sugars, syrups, or 
     molasses to be used for human consumption or to be used for 
     the extraction of sugar for human consumption to report, in 
     the manner prescribed by the Secretary, the quantities of the 
     products imported by the importer and the sugar content or 
     equivalent of the products.
       ``(B) Tariff-rate quotas.--Subparagraph (A) shall not apply 
     to sugars, syrups, or molasses that are within the quantities 
     of tariff-rate quotas that are subject to the lower rate of 
     duties.
       ``(4) Penalty.--Any person willfully failing or refusing to 
     furnish the information, or furnishing willfully any false 
     information, shall be subject to a civil penalty of not more 
     than $10,000 for each such violation.
       ``(5) Monthly reports.--Taking into consideration the 
     information received under this subsection, the Secretary 
     shall publish on a monthly basis composite data on 
     production, imports, distribution, and stock levels of sugar.
       ``(i) Substitution of Refined Sugar.--For purposes of 
     Additional U.S. Note 6 to chapter 17 of the Harmonized Tariff 
     Schedule of the United States and the reexport programs and 
     polyhydric alcohol program administered by the Secretary, all 
     refined sugars (whether derived from sugar beets or 
     sugarcane) produced by cane sugar refineries and beet sugar 
     processors shall be fully substitutable for the export of 
     sugar and sugar-containing products under those programs.''.
       ``(j) Effective Period.--This section shall be effective 
     only for the 1996 through 2007 crops of sugar beets and 
     sugarcane.''.
       (b) Effective Date of Assessment Termination.--Subsection 
     (f) of section 156 of the Federal Agriculture Improvement and 
     Reform Act of 1996 (7 U.S.C. 7272(f)), as in effect 
     immediately before the enactment of the Farm Security and 
     Rural Investment Act of 2002, is deemed to have been repealed 
     effective as of October 1, 2001.
       (c) Interest Rate.--Section 163 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7283) is 
     amended--
       (1) by inserting ``(a) In General.--'' before 
     ``Notwithstanding''; and
       (2) by adding at the end the following:
       ``(b) Sugar.--For purposes of this section, raw cane sugar, 
     refined beet sugar, and in-process sugar eligible for a loan 
     under section 156 shall not be considered an agricultural 
     commodity.''.

     SEC. 1402. STORAGE FACILITY LOANS.

       (a) In General.--Notwithstanding any other provision of law 
     and as soon as practicable after the date of enactment of 
     this Act, the Commodity Credit Corporation shall amend part 
     1436 of title 7, Code of Federal Regulations, to establish a 
     sugar storage facility loan program to provide financing for 
     processors of domestically-produced sugarcane and sugar beets 
     to construct or upgrade storage and handling facilities for 
     raw sugars and refined sugars.
       (b) Eligible Processors.--A storage facility loan described 
     in subsection (a) shall be made available to any processor of 
     domestically produced sugarcane or sugar beets that (as 
     determined by the Secretary)--
       (1) has a satisfactory credit history;
       (2) has a need for increased storage capacity, taking into 
     account the effects of marketing allotments; and
       (3) demonstrates an ability to repay the loan.
       (c) Term of Loans.--A storage facility loan described in 
     subsection (a) shall--
       (1) have a minimum term of 7 years; and
       (2) be in such amounts and on such terms and conditions 
     (including terms and conditions relating to downpayments, 
     collateral, and eligible facilities) as are normal, 
     customary, and appropriate for the size and commercial nature 
     of the borrower.

     SEC. 1403. FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR.

       Part VII of subtitle B of title III of the Agricultural 
     Adjustment Act of 1938 (7 U.S.C. 359aa et seq.) is amended to 
     read as follows:

          ``PART VII--FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR

     ``SEC. 359A. DEFINITIONS.

       ``In this part:
       ``(1) Mainland state.--The term `mainland State' means a 
     State other than an offshore State.
       ``(2) Offshore state.--The term `offshore State' means a 
     sugarcane producing State located outside of the continental 
     United States.
       ``(3) State.--Notwithstanding section 301, the term `State' 
     means--
       ``(A) a State;
       ``(B) the District of Columbia; and
       ``(C) the Commonwealth of Puerto Rico.
       ``(4) United states.--The term `United States', when used 
     in a geographical sense, means all of the States.

     ``SEC. 359B. FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR.

       ``(a) Sugar Estimates.--
       ``(1) In general.--Not later than August 1 before the 
     beginning of each of the 2002 through 2007 crop years, the 
     Secretary shall estimate--
       ``(A) the quantity of sugar that will be consumed in the 
     United States during the crop year;
       ``(B) the quantity of sugar that would provide for 
     reasonable carryover stocks;
       ``(C) the quantity of sugar that will be available from 
     carry-in stocks for consumption in the United States during 
     the crop year;
       ``(D) the quantity of sugar that will be available from the 
     domestic processing of sugarcane and sugar beets; and
       ``(E) the quantity of sugars, syrups, and molasses that 
     will be imported for human consumption or to be used for the 
     extraction of sugar for human consumption in the United 
     States during the crop year, whether such articles are under 
     a

[[Page H1811]]

     tariff-rate quota or are in excess or outside of a tariff-
     rate quota.
       ``(2) Exclusion.--The estimates under this subsection shall 
     not apply to sugar imported for the production of polyhydric 
     alcohol or to any sugar refined and reexported in refined 
     form or in products containing sugar.
       ``(3) Reestimates.--The Secretary shall make reestimates of 
     sugar consumption, stocks, production, and imports for a crop 
     year as necessary, but no later than the beginning of each of 
     the second through fourth quarters of the crop year.
       ``(b) Sugar Allotments.--
       ``(1) In general.--By the beginning of each crop year, the 
     Secretary shall establish for that crop year appropriate 
     allotments under section 359c for the marketing by processors 
     of sugar processed from sugar beets and from domestically 
     produced sugarcane at a level that the Secretary estimates 
     will result in no forfeitures of sugar to the Commodity 
     Credit Corporation under the loan program for sugar 
     established under section 156 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7272).
       ``(2) Products.--The Secretary may include sugar products, 
     whose majority content is sucrose for human consumption, 
     derived from sugarcane, sugar beets, molasses, or sugar in 
     the allotments under paragraph (1) if the Secretary 
     determines it to be appropriate for purposes of this part.
       ``(c) Prohibitions.--
       ``(1) In general.--During any crop year or portion thereof 
     for which marketing allotments have been established, no 
     processor of sugar beets or sugarcane shall market a quantity 
     of sugar in excess of the allocation established for such 
     processor, except to enable another processor to fulfill an 
     allocation established for such other processor or to 
     facilitate the exportation of such sugar.
       ``(2) Civil penalty.--Any processor who knowingly violates 
     paragraph (1) shall be liable to the Commodity Credit 
     Corporation for a civil penalty in an amount equal to 3 times 
     the United States market value, at the time of the commission 
     of the violation, of that quantity of sugar involved in the 
     violation.
       ``(3) Definition of market.--For purposes of this part, the 
     term `market' shall mean to sell or otherwise dispose of in 
     commerce in the United States (including the forfeiture of 
     sugar under the loan program for sugar under section 156 of 
     the Federal Agriculture Improvement and Reform Act of 1996 (7 
     U.S.C. 7272) and, with respect to any integrated processor 
     and refiner, the movement of raw cane sugar into the refining 
     process).

     ``SEC. 359C. ESTABLISHMENT OF FLEXIBLE MARKETING ALLOTMENTS.

       ``(a) In General.--The Secretary shall establish flexible 
     marketing allotments for sugar for any crop year in which the 
     allotments are required under section 359b(b) in accordance 
     with this section.
       ``(b) Overall Allotment Quantity.--
       ``(1) In general.--The Secretary shall establish the 
     overall quantity of sugar to be allotted for the crop year 
     (in this part referred to as the `overall allotment 
     quantity') by deducting from the sum of the estimated sugar 
     consumption and reasonable carryover stocks (at the end of 
     the crop year) for the crop year, as determined under section 
     359b(a)--
       ``(A) 1,532,000 short tons, raw value; and
       ``(B) carry-in stocks of sugar, including sugar in 
     Commodity Credit Corporation inventory.
       ``(2) Adjustment.--The Secretary shall adjust the overall 
     allotment quantity to avoid the forfeiture of sugar to the 
     Commodity Credit Corporation.
       ``(c) Marketing Allotment for Sugar Derived from Sugar 
     Beets and Sugar Derived from Sugarcane.--The overall 
     allotment quantity for the crop year shall be allotted 
     between--
       ``(1) sugar derived from sugar beets by establishing a 
     marketing allotment for a crop year at a quantity equal to 
     the product of multiplying the overall allotment quantity for 
     the crop year by 54.35 percent; and
       ``(2) sugar derived from sugarcane by establishing a 
     marketing allotment for a crop year at a quantity equal to 
     the product of multiplying the overall allotment quantity for 
     the crop year by 45.65 percent.
       ``(d) Filling Cane Sugar and Beet Sugar Allotments.--
       ``(1) Cane sugar.--Each marketing allotment for cane sugar 
     established under this section may only be filled with sugar 
     processed from domestically grown sugarcane.
       ``(2) Beet sugar.--Each marketing allotment for beet sugar 
     established under this section may only be filled with sugar 
     domestically processed from sugar beets.
       ``(e) State Cane Sugar Allotments.--
       ``(1) In general.--The allotment for sugar derived from 
     sugarcane shall be further allotted, among the States in the 
     United States in which sugarcane is produced, after a hearing 
     (if requested by the affected sugarcane processors and 
     growers) and on such notice as the Secretary by regulation 
     may prescribe, in a fair and equitable manner as provided in 
     this subsection and section 359d(b)(1)(D).
       ``(2) Offshore allotment.--
       ``(A) Collectively.--Prior to the allotment of sugar 
     derived from sugarcane to any other State, 325,000 short 
     tons, raw value shall be allotted to the offshore States.
       ``(B) Individually.--The collective offshore State 
     allotment provided for under subparagraph (A) shall be 
     further allotted among the offshore States in which sugarcane 
     is produced, after a hearing (if requested by the affected 
     sugarcane processors and growers) and on such notice as 
     the Secretary by regulation may prescribe, in a fair and 
     equitable manner on the basis of--
       ``(i) past marketings of sugar, based on the average of the 
     2 highest years of production of raw cane sugar from the 1996 
     through 2000 crops;
       ``(ii) the ability of processors to market the sugar 
     covered under the allotments for the crop year; and
       ``(iii) past processings of sugar from sugarcane, based on 
     the 3-year average of the 1998 through 2000 crop years.
       ``(3) Mainland allotment.--The allotment for sugar derived 
     from sugarcane, less the amount provided for under paragraph 
     (2), shall be allotted among the mainland States in the 
     United States in which sugarcane is produced, after a hearing 
     (if requested by the affected sugarcane processors and 
     growers) and on such notice as the Secretary by regulation 
     may prescribe, in a fair and equitable manner on the basis 
     of--
       ``(A) past marketings of sugar, based on the average of the 
     2 highest years of production of raw cane sugar from the 1996 
     through 2000 crops;
       ``(B) the ability of processors to market the sugar covered 
     under the allotments for the crop year; and
       ``(C) past processings of sugar from sugarcane, based on 
     the 3 crop years with the greatest processings (in the 
     mainland States collectively) during the 1991 through 2000 
     crop years.
       ``(f) Filling Cane Sugar Allotments.--Except as provided in 
     section 359e, a State cane sugar allotment established under 
     subsection (e) for a crop year may be filled only with sugar 
     processed from sugarcane grown in the State covered by the 
     allotment.
       ``(g) Adjustment of Marketing Allotments.--
       ``(1) In general.--The Secretary shall, based on 
     reestimates under section 359b(a)(3), adjust upward or 
     downward marketing allotments in a fair and equitable manner, 
     as the Secretary determines appropriate, to reflect changes 
     in estimated sugar consumption, stocks, production, or 
     imports.
       ``(2) Allocation to processors.--In the case of any 
     increase or decrease in an allotment, each allocation to a 
     processor of the allotment under section 359d, and each 
     proportionate share established with respect to the allotment 
     under section 359f(c), shall be increased or decreased by the 
     same percentage that the allotment is increased or decreased.
       ``(3) Carry-over of reductions.--Whenever a marketing 
     allotment for a crop year is required to be reduced during 
     the crop year under this subsection, if, at the time of the 
     reduction, the quantity of sugar marketed exceeds the 
     processor's reduced allocation, the allocation of an 
     allotment next established for the processor shall be reduced 
     by the quantity of the excess sugar marketed.
       ``(h) Suspension of Allotments.--Whenever the Secretary 
     estimates or reestimates under section 359b(a), or has reason 
     to believe, that imports of sugars, syrups or molasses for 
     human consumption or to be used for the extraction of sugar 
     for human consumption, whether under a tariff-rate quota or 
     in excess or outside of a tariff-rate quota, will exceed 
     1,532,000 short tons (raw value equivalent) (excluding any 
     imports attributable to reassignment under paragraph (1)(D) 
     or (2)(C) of section 359e(b)), and that the imports would 
     lead to a reduction of the overall allotment quantity, the 
     Secretary shall suspend the marketing allotments established 
     under this section until such time as the imports have been 
     restricted, eliminated, or reduced to or below the level of 
     1,532,000 short tons (raw value equivalent).

     ``SEC. 359D. ALLOCATION OF MARKETING ALLOTMENTS.

       ``(a) Allocation to Processors.--Whenever marketing 
     allotments are established for a crop year under section 
     359c, in order to afford all interested persons an equitable 
     opportunity to market sugar under an allotment, the Secretary 
     shall allocate each such allotment among the processors 
     covered by the allotment.
       ``(b) Hearing and Notice.--
       ``(1) Cane sugar.--
       ``(A) In general.--The Secretary shall make allocations for 
     cane sugar after a hearing, if requested by the affected 
     sugarcane processors and growers, and on such notice as the 
     Secretary by regulation may prescribe, in such manner and in 
     such quantities as to provide a fair, efficient, and 
     equitable distribution of the allocations under this 
     paragraph. Each such allocation shall be subject to 
     adjustment under section 359c(g).
       ``(B) Multiple processor states.--Except as provided in 
     subparagraphs (C) and (D), the Secretary shall allocate the 
     allotment for cane sugar among multiple cane sugar processors 
     in a single State based on--
       ``(i) past marketings of sugar, based on the average of the 
     2 highest years of production of raw cane sugar from among 
     the 1996 through 2000 crops;
       ``(ii) the ability of processors to market sugar covered by 
     that portion of the allotment allocated for the crop year; 
     and
       ``(iii) past processings of sugar from sugarcane, based on 
     the average of the 3 highest years of production during the 
     1996 through 2000 crop years.
       ``(C) Talisman processing facility.--In the case of 
     allotments under subparagraph (B) attributable to the 
     operations of the Talisman processing facility before the 
     date of enactment of this subparagraph, the Secretary shall 
     allocate the allotment among processors in the State under 
     subparagraph (A) in accordance with the agreements of March 
     25 and 26, 1999, between the affected processors and the 
     Secretary of the Interior.
       ``(D) Proportionate share states.--In the case of States 
     subject to section 359f(c), the Secretary shall allocate the 
     allotment for cane sugar among multiple cane sugar processors 
     in a single State based on--
       ``(i) past marketings of sugar, based on the average of the 
     2 highest years of production of

[[Page H1812]]

     raw cane sugar from among the 1997 through 2001 crop years;
       ``(ii) the ability of processors to market sugar covered by 
     that portion of the allotments allocated for the crop year; 
     and
       ``(iii) past processings of sugar from sugarcane, based on 
     the average of the 2 highest crop years of crop production 
     during the 1997 through 2001 crop years.
       ``(E) New entrants.--
       ``(i) In general.--Notwithstanding subparagraphs (B) and 
     (D), the Secretary, on application of any processor that 
     begins processing sugarcane on or after the date of enactment 
     of this subparagraph, and after a hearing (if requested by 
     the affected sugarcane processors and growers) and on such 
     notice as the Secretary by regulation may prescribe, may 
     provide the processor with an allocation that provides a 
     fair, efficient and equitable distribution of the allocations 
     from the allotment for the State in which the processor is 
     located.
       ``(ii) Proportionate share states.--In the case of 
     proportionate share States, the Secretary shall establish 
     proportionate shares in a quantity sufficient to produce the 
     sugarcane required to satisfy the allocations.
       ``(iii) Limitations.--The allotment for a new processor 
     under this subparagraph shall not exceed--

       ``(I) in the case of the first crop year of operation of a 
     new processor, 50,000 short tons (raw value); and
       ``(II) in the case of each subsequent crop year of 
     operation of the new processor, a quantity established by the 
     Secretary in accordance with this subparagraph and the 
     criteria described in subparagraph (B) or (D), as applicable.

       ``(iv) New entrant states.--

       ``(I) In general.--Notwithstanding subparagraphs (A) and 
     (C) of section 359c(e)(3), to accommodate an allocation under 
     clause (i) to a new processor located in a new entrant 
     mainland State, the Secretary shall provide the new entrant 
     mainland State with an allotment.
       ``(II) Effect on other allotments.--The allotment to any 
     new entrant mainland State shall be subtracted, on a pro rata 
     basis, from the allotments otherwise allotted to each 
     mainland State under section 359c(e)(3).

       ``(v) Adverse effects.--Before providing an initial 
     processor allocation or State allotment to a new entrant 
     processor or a new entrant State under this subparagraph, the 
     Secretary shall take into consideration any adverse effects 
     that the provision of the allocation or allotment may have on 
     existing cane processors and producers in mainland States.
       ``(vi) Ability to market.--Consistent with section 359c and 
     this section, any processor allocation or State allotment 
     made to a new entrant processor or to a new entrant State 
     under this subparagraph shall be provided only after the 
     applicant processor, or the applicable processors in the 
     State, have demonstrated the ability to process, produce, and 
     market (including the transfer or delivery of the raw cane 
     sugar to a refinery for further processing or marketing) raw 
     cane sugar for the crop year for which the allotment is 
     applicable.
       ``(vii) Prohibition.--Not more than 1 processor allocation 
     provided under this subparagraph may be applicable to any 
     individual sugar processing facility.
       ``(F) Transfer of ownership.--Except as otherwise provided 
     in section 359f(c)(8), if a sugarcane processor is sold or 
     otherwise transferred to another owner or is closed as part 
     of an affiliated corporate group processing consolidation, 
     the Secretary shall transfer the allotment allocation for the 
     processor to the purchaser, new owner, successor in interest, 
     or any remaining processor of an affiliated entity, as 
     applicable, of the processor.
       ``(2) Beet sugar.--
       ``(A) In general.--Except as otherwise provided in this 
     paragraph and sections 359c(g), 359e(b), and 359f(b), the 
     Secretary shall make allocations for beet sugar among beet 
     sugar processors for each crop year that allotments are in 
     effect on the basis of the adjusted weighted average quantity 
     of beet sugar produced by the processors for each of the 1998 
     through 2000 crop years, as determined under this paragraph.
       ``(B) Quantity.--The quantity of an allocation made for a 
     beet sugar processor for a crop year under subparagraph (A) 
     shall bear the same ratio to the quantity of allocations made 
     for all beet sugar processors for the crop year as the 
     adjusted weighted average quantity of beet sugar produced by 
     the processor (as determined under subparagraphs (C) and (D)) 
     bears to the total of the adjusted weighted average 
     quantities of beet sugar produced by all processors (as so 
     determined).
       ``(C) Weighted average quantity.--Subject to subparagraph 
     (D), the weighted quantity of beet sugar produced by a beet 
     sugar processor during each of the 1998 through 2000 crop 
     years shall be (as determined by the Secretary)--
       ``(i) in the case of the 1998 crop year, 25 percent of the 
     quantity of beet sugar produced by the processor during the 
     crop year;
       ``(ii) in the case of the 1999 crop year, 35 percent of the 
     quantity of beet sugar produced by the processor during the 
     crop year; and
       ``(iii) in the case of the 2000 crop year, 40 percent of 
     the quantity of beet sugar produced by the processor 
     (including any quantity of sugar received from the Commodity 
     Credit Corporation) during the crop year.
       ``(D) Adjustments.--
       ``(i) In general.--The Secretary shall adjust the weighted 
     average quantity of beet sugar produced by a beet sugar 
     processor during the 1998 through 2000 crop years under 
     subparagraph (C) if the Secretary determines that the 
     processor--

       ``(I) during the 1996 through 2000 crop years, opened a 
     sugar beet processing factory;
       ``(II) during the 1998 through 2000 crop years, closed a 
     sugar beet processing factory;
       ``(III) during the 1998 through 2000 crop years, 
     constructed a molasses desugarization facility; or
       ``(IV) during the 1998 through 2000 crop years, suffered 
     substantial quality losses on sugar beets stored during any 
     such crop year.

       ``(ii) Quantity.--The quantity of beet sugar produced by a 
     beet sugar processor under subparagraph (C) shall be--

       ``(I) in the case of a processor that opened a sugar beet 
     processing factory, increased by 1.25 percent of the total of 
     the adjusted weighted average quantities of beet sugar 
     produced by all processors during the 1998 through 2000 crop 
     years (without consideration of any adjustment under this 
     subparagraph) for each sugar beet processing factory that is 
     opened by the processor;
       ``(II) in the case of a processor that closed a sugar beet 
     processing factory, decreased by 1.25 percent of the total of 
     the adjusted weighted average quantities of beet sugar 
     produced by all processors during the 1998 through 2000 crop 
     years (without consideration of any adjustment under this 
     subparagraph) for each sugar beet processing factory that is 
     closed by the processor;
       ``(III) in the case of a processor that constructed a 
     molasses desugarization facility, increased by 0.25 percent 
     of the total of the adjusted weighted average quantities of 
     beet sugar produced by all processors during the 1998 through 
     2000 crop years (without consideration of any adjustment 
     under this subparagraph) for each molasses desugarization 
     facility that is constructed by the processor; and
       ``(IV) in the case of a processor that suffered substantial 
     quality losses on stored sugar beets, increased by 1.25 
     percent of the total of the adjusted weighted average 
     quantities of beet sugar produced by all processors during 
     the 1998 through 2000 crop years (without consideration of 
     any adjustment under this subparagraph).

       ``(E) Permanent termination of operations of a processor.--
     If a processor of beet sugar has been dissolved, liquidated 
     in a bankruptcy proceeding, or otherwise has permanently 
     terminated operations (other than in conjunction with a sale 
     or other disposition of the processor or the assets of the 
     processor), the Secretary shall--
       ``(i) eliminate the allocation of the processor provided 
     under this section; and
       ``(ii) distribute the allocation to other beet sugar 
     processors on a pro rata basis.
       ``(F) Sale of all assets of a processor to another 
     processor.--If a processor of beet sugar (or all of the 
     assets of the processor) is sold to another processor of beet 
     sugar, the Secretary shall transfer the allocation of the 
     seller to the buyer unless the allocation has been 
     distributed to other sugar beet processors under subparagraph 
     (E).
       ``(G) Sale of factories of a processor to another 
     processor.--
       ``(i) In general.--Subject to subparagraphs (E) and (F), if 
     1 or more factories of a processor of beet sugar (but not all 
     of the assets of the processor) are sold to another processor 
     of beet sugar during a crop year, the Secretary shall assign 
     a pro rata portion of the allocation of the seller to the 
     allocation of the buyer to reflect the historical 
     contribution of the production of the sold factory or 
     factories to the total allocation of the seller.
       ``(ii) Application of allocation.--The assignment of the 
     allocation under clause (i) shall apply--

       ``(I) during the remainder of the crop year during which 
     the sale described in clause (i) occurs (referred to in this 
     subparagraph as the `initial crop year'); and
       ``(II) each subsequent crop year (referred in this 
     subparagraph as a `subsequent crop year'), subject to clause 
     (iii).

       ``(iii) Subsequent crop years.--

       ``(I) In general.--The assignment of the allocation under 
     clause (i) shall apply during each subsequent crop year 
     unless the acquired factory or factories continue in 
     operation for less than the initial crop year and the first 
     subsequent crop year.
       ``(II) Reassignment.--If the acquired factory or factories 
     do not continue in operation for the complete initial crop 
     year and the first subsequent crop year, the Secretary shall 
     reassign the temporary allocation to other processors of beet 
     sugar on a pro rata basis.

       ``(iv) Use of other factories to fill allocation.--If the 
     transferred allocation to the buyer for the purchased factory 
     or factories cannot be filled by the production of the 
     purchased factory or factories for the initial crop year or a 
     subsequent crop year, the remainder of the transferred 
     allocation may be filled by beet sugar produced by the buyer 
     from other factories of the buyer.
       ``(H) New entrants starting production or reopening 
     factories.--
       ``(i) In general.--Except as provided by clause (ii), if an 
     individual or entity that does not have an allocation of beet 
     sugar under this part (referred to in this paragraph as a 
     `new entrant') starts processing sugar beets after the date 
     of enactment of this subparagraph, or acquires and reopens a 
     factory that produced beet sugar during previous crop years 
     that (at the time of acquisition) has no allocation 
     associated with the factory under this part, the Secretary 
     shall--

       ``(I) assign an allocation for beet sugar to the new 
     entrant that provides a fair and equitable distribution of 
     the allocations for beet sugar; and
       ``(II) reduce the allocations for beet sugar of all other 
     processors on a pro rata basis to reflect the new allocation.

       ``(ii) Exception.--If a new entrant acquires and reopens a 
     factory that previously produced beet sugar from sugar beets 
     and from sugar beet molasses but the factory last processed 
     sugar

[[Page H1813]]

     beets during the 1997 crop year and the new entrant starts to 
     process sugar beets at such factory after the date of 
     enactment of this clause, the Secretary shall--

       ``(I) assign an allocation for beet sugar to the new 
     entrant that is not less than the greater of 1.67 percent of 
     the total of the adjusted weighted average quantities of beet 
     sugar produced by all processors during the 1998 through 2000 
     crop years as determined under subsection (b)(2)(C), or 
     1,500,000 hundredweights; and
       ``(II) reduce the allocations for beet sugar of all other 
     processors on a pro rata basis to reflect the new allocation.

       ``(I) New entrants acquiring ongoing factories with 
     production history.--If a new entrant acquires a factory that 
     has production history during the period of the 1998 through 
     2000 crop years and that is producing beet sugar at the time 
     the allocations are made from a processor that has an 
     allocation of beet sugar, the Secretary shall transfer a 
     portion of the allocation of the seller to the new entrant to 
     reflect the historical contribution of the production of the 
     sold factory to the total allocation of the seller.

     ``SEC. 359E. REASSIGNMENT OF DEFICITS.

       ``(a) Estimates of Deficits.--At any time allotments are in 
     effect under this part, the Secretary, from time to time, 
     shall determine whether (in view of then-current inventories 
     of sugar, the estimated production of sugar and expected 
     marketings, and other pertinent factors) any processor of 
     sugarcane will be unable to market the sugar covered by the 
     portion of the State cane sugar allotment allocated to the 
     processor and whether any processor of sugar beets will be 
     unable to market sugar covered by the portion of the beet 
     sugar allotment allocated to the processor.
       ``(b) Reassignment of Deficits.--
       ``(1) Cane sugar.--If the Secretary determines that any 
     sugarcane processor who has been allocated a share of a State 
     cane sugar allotment will be unable to market the processor's 
     allocation of the State's allotment for the crop year--
       ``(A) the Secretary first shall reassign the estimated 
     quantity of the deficit to the allocations for other 
     processors within that State, depending on the capacity of 
     each other processor to fill the portion of the deficit to be 
     assigned to it and taking into account the interests of 
     producers served by the processors;
       ``(B) if after the reassignments the deficit cannot be 
     completely eliminated, the Secretary shall reassign the 
     estimated quantity of the deficit proportionately to the 
     allotments for other cane sugar States, depending on the 
     capacity of each other State to fill the portion of the 
     deficit to be assigned to it, with the reassigned quantity to 
     each State to be allocated among processors in that State in 
     proportion to the allocations of the processors;
       ``(C) if after the reassignments the deficit cannot be 
     completely eliminated, the Secretary shall reassign the 
     estimated quantity of the deficit to the Commodity Credit 
     Corporation and shall sell such quantity of sugar from 
     inventories of the Corporation unless the Secretary 
     determines that such sales would have a significant effect on 
     the price of sugar; and
       ``(D) if after the reassignments and sales, the deficit 
     cannot be completely eliminated, the Secretary shall reassign 
     the remainder to imports.
       ``(2) Beet sugar.--If the Secretary determines that a sugar 
     beet processor who has been allocated a share of the beet 
     sugar allotment will be unable to market that allocation--
       ``(A) the Secretary first shall reassign the estimated 
     quantity of the deficit to the allotments for other sugar 
     beet processors, depending on the capacity of each other 
     processor to fill the portion of the deficit to be assigned 
     to it and taking into account the interests of producers 
     served by the processors;
       ``(B) if after the reassignments the deficit cannot be 
     completely eliminated, the Secretary shall reassign the 
     estimated quantity of the deficit to the Commodity Credit 
     Corporation and shall sell such quantity of sugar from 
     inventories of the Corporation unless the Secretary 
     determines that such sales would have a significant effect on 
     the price of sugar; and
       ``(C) if after the reassignments and sales, the deficit 
     cannot be completely eliminated, the Secretary shall reassign 
     the remainder to imports.
       ``(3) Corresponding increase.--The allocation of each 
     processor receiving a reassigned quantity of an allotment 
     under this subsection for a crop year shall be increased to 
     reflect the reassignment.

     ``SEC. 359F. PROVISIONS APPLICABLE TO PRODUCERS.

       ``(a) Processor Assurances.--
       ``(1) In general.--If allotments for a crop year are 
     allocated to processors under section 359d, the Secretary 
     shall obtain from the processors such assurances as the 
     Secretary considers adequate that the allocation will be 
     shared among producers served by the processor in a fair and 
     equitable manner that adequately reflects producers' 
     production histories.
       ``(2) Arbitration.--
       ``(A) In general.--Any dispute between a processor and a 
     producer, or group of producers, with respect to the sharing 
     of the allocation to the processor shall be resolved through 
     arbitration by the Secretary on the request of either party.
       ``(B) Period.--The arbitration shall, to the maximum extent 
     practicable, be--
       ``(i) commenced not more than 45 days after the request; 
     and
       ``(ii) completed not more than 60 days after the request.
       ``(b) Sugar Beet Processing Facility Closures.--
       ``(1) In general.--If a sugar beet processing facility is 
     closed and the sugar beet growers that previously delivered 
     beets to the facility elect to deliver their beets to another 
     processing company, the growers may petition the Secretary to 
     modify allocations under this part to allow the delivery.
       ``(2) Increased allocation for processing company.--The 
     Secretary may increase the allocation to the processing 
     company to which the growers elect to deliver their sugar 
     beets, with the approval of the processing company, to a 
     level that does not exceed the processing capacity of the 
     processing company, to accommodate the change in deliveries.
       ``(3) Decreased allocation for closed company.--The 
     increased allocation shall be deducted from the allocation to 
     the company that owned the processing facility that has been 
     closed and the remaining allocation shall be unaffected.
       ``(4) Timing.--The determinations of the Secretary on the 
     issues raised by the petition shall be made within 60 days 
     after the filing of the petition.
       ``(c) Proportionate Shares of Certain Allotments.--
       ``(1) In general.--
       ``(A) States affected.--In any case in which a State 
     allotment is established under section 359c(f) and there are 
     in excess of 250 sugarcane producers in the State (other than 
     Puerto Rico), the Secretary shall make a determination under 
     subparagraph (B).
       ``(B) Determination.--The Secretary shall determine, for 
     each State allotment described in subparagraph (A), whether 
     the production of sugarcane, in the absence of proportionate 
     shares, will be greater than the quantity needed to enable 
     processors to fill the allotment and provide a normal 
     carryover inventory of sugar.
       ``(2) Establishment of proportionate shares.--If the 
     Secretary determines under paragraph (1) that the quantity of 
     sugarcane produced by producers in the area covered by a 
     State allotment for a crop year will be in excess of the 
     quantity needed to enable processors to fill the allotment 
     for the crop year and provide a normal carryover inventory of 
     sugar, the Secretary shall establish a proportionate share 
     for each sugarcane-producing farm that limits the acreage of 
     sugarcane that may be harvested on the farm for sugar or seed 
     during the crop year the allotment is in effect as provided 
     in this subsection. Each such proportionate share shall be 
     subject to adjustment under paragraph (7) and section 
     359c(g).
       ``(3) Method of determining.--For purposes of determining 
     proportionate shares for any crop of sugarcane:
       ``(A) The Secretary shall establish the State's per-acre 
     yield goal for a crop of sugarcane at a level (not less than 
     the average per-acre yield in the State for the 2 highest 
     years from among the 1999, 2000, and 2001 crop years, as 
     determined by the Secretary) that will ensure an adequate net 
     return per pound to producers in the State, taking into 
     consideration any available production research data that the 
     Secretary considers relevant.
       ``(B) The Secretary shall adjust the per-acre yield goal by 
     the average recovery rate of sugar produced from sugarcane by 
     processors in the State.
       ``(C) The Secretary shall convert the State allotment for 
     the crop year involved into a State acreage allotment for the 
     crop by dividing the State allotment by the per-acre yield 
     goal for the State, as established under subparagraph (A) and 
     as further adjusted under subparagraph (B).
       ``(D) The Secretary shall establish a uniform reduction 
     percentage for the crop by dividing the State acreage 
     allotment, as determined for the crop under subparagraph (C), 
     by the sum of all adjusted acreage bases in the State, as 
     determined by the Secretary.
       ``(E) The uniform reduction percentage for the crop, as 
     determined under subparagraph (D), shall be applied to the 
     acreage base for each sugarcane-producing farm in the State 
     to determine the farm's proportionate share of sugarcane 
     acreage that may be harvested for sugar or seed.
       ``(4) Acreage base.--For purposes of this subsection, the 
     acreage base for each sugarcane-producing farm shall be 
     determined by the Secretary, as follows:
       ``(A) The acreage base for any farm shall be the number of 
     acres that is equal to the average of the acreage planted and 
     considered planted for harvest for sugar or seed on the farm 
     in the 2 highest of the 1999, 2000, and 2001 crop years.
       ``(B) Acreage planted to sugarcane that producers on a farm 
     were unable to harvest to sugarcane for sugar or seed because 
     of drought, flood, other natural disaster, or other condition 
     beyond the control of the producers may be considered as 
     harvested for the production of sugar or seed for purposes of 
     this paragraph.
       ``(5) Violation.--
       ``(A) In general.--Whenever proportionate shares are in 
     effect in a State for a crop of sugarcane, producers on a 
     farm shall not knowingly harvest, or allow to be harvested, 
     for sugar or seed an acreage of sugarcane in excess of the 
     farm's proportionate share for the crop year, or otherwise 
     violate proportionate share regulations issued by the 
     Secretary under section 359h(a).
       ``(B) Determination of violation.--No producer shall be 
     considered to have violated subparagraph (A) unless the 
     processor of the sugarcane harvested by such producer from 
     acreage in excess of the proportionate share of the farm 
     markets an amount of sugar that exceeds the allocation of 
     such processor for a crop year.
       ``(C) Civil penalty.--Any producer on a farm who violates 
     subparagraph (A) by knowingly harvesting, or allowing to be 
     harvested, an acreage of sugarcane in excess of the farm's 
     proportionate share shall be liable to the Commodity Credit 
     Corporation for a civil penalty equal to one and one-half 
     times the United States market value of the quantity of sugar 
     that is marketed by the processor of such sugarcane in excess 
     of

[[Page H1814]]

     the allocation of such processor for the crop year. The 
     Secretary shall prorate penalties imposed under this 
     subparagraph in a fair and equitable manner among all the 
     producers of sugarcane harvested from excess acreage that is 
     acquired by such processor.
       ``(6) Waiver.--Notwithstanding the preceding subparagraph, 
     the Secretary may authorize the county and State committees 
     established under section 8(b) of the Soil Conservation and 
     Domestic Allotment Act (16 U.S.C. 590h(b)) to waive or modify 
     deadlines and other proportionate share requirements in cases 
     in which lateness or failure to meet the other requirements 
     does not affect adversely the operation of proportionate 
     shares.
       ``(7) Adjustments.--Whenever the Secretary determines that, 
     because of a natural disaster or other condition beyond the 
     control of producers that adversely affects a crop of 
     sugarcane subject to proportionate shares, the amount of 
     sugarcane produced by producers subject to the proportionate 
     shares will not be sufficient to enable processors in the 
     State to meet the State's cane sugar allotment and provide a 
     normal carryover inventory of sugar, the Secretary may 
     uniformly allow producers to harvest an amount of sugarcane 
     in excess of their proportionate share, or suspend 
     proportionate shares entirely, as necessary to enable 
     processors to meet the State allotment and provide a normal 
     carryover inventory of sugar.
       ``(8) Processing facility closures.--
       ``(A) In general.--If a sugarcane processing facility 
     subject to this subsection is closed and the sugarcane 
     growers that delivered sugarcane to the facility prior to 
     closure elect to deliver their sugarcane to another 
     processing company, the growers may petition the Secretary to 
     modify allocations under this part to allow the delivery.
       ``(B) Increased allocation for processing company.--The 
     Secretary may increase the allocation to the processing 
     company to which the growers elect to deliver the sugarcane, 
     with the approval of the processing company, to a level that 
     does not exceed the processing capacity of the processing 
     company, to accommodate the change in deliveries.
       ``(C) Decreased allocation for closed company.--The 
     increased allocation shall be deducted from the allocation to 
     the company that owned the processing facility that has been 
     closed and the remaining allocation shall be unaffected.
       ``(D) Timing.--The determinations of the Secretary on the 
     issues raised by the petition shall be made within 60 days 
     after the filing of the petition.

     ``SEC. 359G. SPECIAL RULES.

       ``(a) Transfer of Acreage Base History.--For the purpose of 
     establishing proportionate shares for sugarcane farms under 
     section 359f(c), the Secretary, on application of any 
     producer, with the written consent of all owners of a farm, 
     may transfer the acreage base history of the farm to any 
     other parcels of land of the applicant.
       ``(b) Preservation of Acreage Base History.--If for reasons 
     beyond the control of a producer on a farm, the producer is 
     unable to harvest an acreage of sugarcane for sugar or seed 
     with respect to all or a portion of the proportionate share 
     established for the farm under section 359f(c), the 
     Secretary, on the application of the producer and with the 
     written consent of all owners of the farm, may preserve for a 
     period of not more than 5 consecutive years the acreage base 
     history of the farm to the extent of the proportionate share 
     involved. The Secretary may permit the proportionate share to 
     be redistributed to other farms, but no acreage base history 
     for purposes of establishing acreage bases shall accrue to 
     the other farms by virtue of the redistribution of the 
     proportionate share.
       ``(c) Revisions of Allocations and Proportionate Shares.--
     The Secretary, after such notice as the Secretary by 
     regulation may prescribe, may revise or amend any allocation 
     of a marketing allotment under section 359d, or any 
     proportionate share established or adjusted for a farm under 
     section 359f(c), on the same basis as the initial allocation 
     or proportionate share was required to be established.
       ``(d) Transfers of Mill Allocations.--
       ``(1) Transfer authorized.--A producer in a proportionate 
     share State, upon written consent from all crop-share owners 
     (or the representative of the crop-share owners) of a farm, 
     and from the processing company holding the applicable 
     allocation for such shares, may deliver sugarcane to another 
     processing company if the additional delivery, when combined 
     with such other processing company's existing deliveries, 
     does not exceed the processing capacity of the company.
       ``(2) Allocation adjustment.--Notwithstanding section 359d, 
     the Secretary shall adjust the allocations of each of such 
     processing companies affected by a transfer under paragraph 
     (1) to reflect the change in deliveries, based on the product 
     of--
       ``(A) the number of acres of proportionate shares being 
     transferred; and
       ``(B) the State's per acre yield goal established under 
     section 359f(c)(3).

     ``SEC. 359H. REGULATIONS; VIOLATIONS; PUBLICATION OF 
                   SECRETARY'S DETERMINATIONS; JURISDICTION OF THE 
                   COURTS; UNITED STATES ATTORNEYS.

       ``(a) Regulations.--The Secretary or the Commodity Credit 
     Corporation, as appropriate, shall issue such regulations as 
     may be necessary to carry out the authority vested in the 
     Secretary in administering this part.
       ``(b) Violation.--Any person knowingly violating any 
     regulation of the Secretary issued under subsection (a) shall 
     be subject to a civil penalty of not more than $5,000 for 
     each violation.
       ``(c) Publication in Federal Register.--Each determination 
     issued by the Secretary to establish, adjust, or suspend 
     allotments under this part shall be promptly published in the 
     Federal Register and shall be accompanied by a statement of 
     the reasons for the determination.
       ``(d) Jurisdiction of Courts; United States Attorneys.--
       ``(1) Jurisdiction of courts.--The several district courts 
     of the United States are vested with jurisdiction 
     specifically to enforce, and to prevent and restrain any 
     person from violating, this part or any regulation issued 
     thereunder.
       ``(2) United states attorneys.--Whenever the Secretary 
     shall so request, it shall be the duty of the several United 
     States attorneys, in their respective districts, to institute 
     proceedings to enforce the remedies and to collect the 
     penalties provided for in this part. The Secretary may elect 
     not to refer to a United States attorney any violation of 
     this part or regulation when the Secretary determines that 
     the administration and enforcement of this part would be 
     adequately served by written notice or warning to any person 
     committing the violation.
       ``(e) Nonexclusivity of Remedies.--The remedies and 
     penalties provided for in this part shall be in addition to, 
     and not exclusive of, any remedies or penalties existing at 
     law or in equity.

     ``SEC. 359I. APPEALS.

       ``(a) In General.--An appeal may be taken to the Secretary 
     from any decision under section 359d establishing allocations 
     of marketing allotments, or under section 359f, by any person 
     adversely affected by reason of any such decision.
       ``(b) Procedure.--
       ``(1) Notice of appeal.--Any such appeal shall be taken by 
     filing with the Secretary, within 20 days after the decision 
     complained of is effective, notice in writing of the appeal 
     and a statement of the reasons therefor. Unless a later date 
     is specified by the Secretary as part of the Secretary's 
     decision, the decision complained of shall be considered to 
     be effective as of the date on which announcement of the 
     decision is made. The Secretary shall deliver a copy of any 
     notice of appeal to each person shown by the records of the 
     Secretary to be adversely affected by reason of the decision 
     appealed, and shall at all times thereafter permit any such 
     person to inspect and make copies of appellant's reasons for 
     the appeal and shall on application permit the person to 
     intervene in the appeal.
       ``(2) Hearing.--The Secretary shall provide each appellant 
     an opportunity for a hearing before an administrative law 
     judge in accordance with sections 554 and 556 of title 5, 
     United States Code. The expenses for conducting the hearing 
     shall be reimbursed by the Commodity Credit Corporation.
       ``(c) Special Appeal Process Regarding Beet Sugar 
     Allocations.--
       ``(1) Appeal authorized.--Beginning after the 2006 crop 
     year, a processor that has an allocation of the beet sugar 
     allotment under this part (referred to in this subsection as 
     a `petitioner') may file a notice of appeal with the 
     Secretary regarding the petitioner's beet sugar allocation. 
     Except as provided in paragraph (2), the Secretary shall 
     consider the appeal if the notice alleges that any processor 
     that has a beet sugar allocation has failed to fill at least 
     82.5 percent of its allocation of the beet sugar allotment 
     with sugar produced by it or received from the Commodity 
     Credit Corporation in 2 out of the 3 crop years preceding the 
     crop year in which the appeal is filed. A processor that is 
     alleged to have failed to fill at least 82.5 percent of its 
     allocation shall be allowed to fully participate in the 
     appeal.
       ``(2) Exceptions.--An appeal under paragraph (1) shall not 
     be based on the failure of a processor to fill at least 82.5 
     percent of its allocation because of drought, flood, hail, or 
     other weather disaster, as determined by the Secretary. The 
     determination by the Secretary shall not require a formal 
     disaster declaration.
       ``(3) Response to appeal.--Upon the petitioner making an 
     appeal to the Secretary, and upon a review by the Secretary 
     of how processors have filled their allocations, the 
     Secretary may--
       ``(A) assign an increased allocation for beet sugar to the 
     petitioner that provides a fair and equitable distribution of 
     the allocations for beet sugar, taking into account--
       ``(i) production history during the period beginning on 
     April 4, 1996, and through the date of enactment of the Farm 
     Security and Rural Investment Act of 2002;
       ``(ii) capital investment during that period;
       ``(iii) increases in United States sugar consumption; and
       ``(iv) the ability or inability of processors to fill the 
     allocations they have received under this part; and
       ``(B) reduce, correspondingly, the allocation for beet 
     sugar of each processor determined to have failed to fill at 
     least 82.5 percent of its allocation of the beet sugar 
     allotment as described in paragraph (1).
       ``(4) Filing deadline.--For purposes of the filing deadline 
     specified in subsection (b)(1), the 20-day period shall 
     commence on the date on which the Secretary announces the 
     allocations for the subsequent crop year or October 1, 
     whichever is earlier.

     ``SEC. 359J. ADMINISTRATION.

       ``(a) Use of Certain Agencies.--In carrying out this part, 
     the Secretary may use the services of local committees of 
     sugar beet or sugarcane producers, sugarcane processors, or 
     sugar beet processors, State and county committees 
     established under section 8(b) of the Soil Conservation and 
     Domestic Allotment Act (16 U.S.C. 590h(b)), and the 
     departments and agencies of the United States Government.
       ``(b) Use of Commodity Credit Corporation.--The Secretary 
     shall use the services, facilities, funds, and authorities of 
     the Commodity Credit Corporation to carry out this part.

[[Page H1815]]

     ``SEC. 359K. REALLOCATING SUGAR QUOTA IMPORT SHORTFALLS.

       ``(a) In General.--Notwithstanding any other provision of 
     law, on or after June 1 of each of the 2002 through 2007 
     calendar years, the United States Trade Representative, in 
     consultation with the Secretary, shall determine the amount 
     of the quota of cane sugar used by each qualified supplying 
     country for that crop year, and may reallocate the unused 
     quota for that crop year among qualified supplying countries.
       ``(b) Qualified Supplying Country Defined.--In this 
     section, the term `qualified supplying country' means one of 
     the following foreign countries that is allowed to export 
     cane sugar to the United States under an agreement or any 
     other country with which the United States has an agreement 
     relating to the importation of cane sugar:
      Argentina
      Australia
      Barbados
      Belize
      Bolivia
      Brazil
      Colombia
      Republic of the Congo
      Costa Rica
      Dominican Republic
      Ecuador
      El Salvador
      Fiji
      Gabon
      Guatemala
      Guyana
      Haiti
      Honduras
      India
      Cote D'Ivoire, formerly known as the Ivory Coast
      Jamaica
      Madagascar
      Malawi
      Mauritius
      Mexico
      Mozambique
      Nicaragua
      Panama
      Papua New Guinea
      Paraguay
      Peru
      Philippines
      St. Kitts and Nevis
      South Africa
      Swaziland
      Taiwan
      Thailand
      Trinidad-Tobago
      Uruguay
      Zimbabwe.''.
                           Subtitle E--Dairy

     SEC. 1501. MILK PRICE SUPPORT PROGRAM.

       (a) Support Activities.--During the period beginning on 
     June 1, 2002, and ending on December 31, 2007, the Secretary 
     of Agriculture shall support the price of milk produced in 
     the 48 contiguous States through the purchase of cheese, 
     butter, and nonfat dry milk produced from the milk.
       (b) Rate.--During the period specified in subsection (a), 
     the price of milk shall be supported at a rate equal to $9.90 
     per hundredweight for milk containing 3.67 percent butterfat.
       (c) Purchase Prices.--
       (1) Uniform prices.--The support purchase prices under this 
     section for each of the products of milk (butter, cheese, and 
     nonfat dry milk) announced by the Secretary shall be the same 
     for all of that product sold by persons offering to sell the 
     product to the Secretary.
       (2) Sufficient prices.--The purchase prices shall be 
     sufficient to enable plants of average efficiency to pay 
     producers, on average, a price that is not less than the rate 
     of price support for milk in effect under subsection (b).
       (d) Special Rule for Butter and Nonfat Dry Milk Purchase 
     Prices.--
       (1) Allocation of purchase prices.--The Secretary may 
     allocate the rate of price support between the purchase 
     prices for nonfat dry milk and butter in a manner that will 
     result in the lowest level of expenditures by the Commodity 
     Credit Corporation or achieve such other objectives as the 
     Secretary considers appropriate. Not later than 10 days after 
     making or changing an allocation, the Secretary shall notify 
     the Committee on Agriculture of the House of Representatives 
     and the Committee on Agriculture, Nutrition, and Forestry of 
     the Senate of the allocation. Section 553 of title 5, United 
     States Code, shall not apply with respect to the 
     implementation of this section.
       (2) Timing of purchase price adjustments.--The Secretary 
     may make any such adjustments in the purchase prices for 
     nonfat dry milk and butter the Secretary considers to be 
     necessary not more than twice in each calendar year.
       (e) Commodity Credit Corporation.--The Secretary shall 
     carry out the program authorized by this section through the 
     Commodity Credit Corporation.

     SEC. 1502. NATIONAL DAIRY MARKET LOSS PAYMENTS.

       (a) Definitions.--In this section:
       (1) Class i milk.--The term ``Class I milk'' means milk 
     (including milk components) classified as Class I milk under 
     a Federal milk marketing order.
       (2) Eligible production.--The term ``eligible production'' 
     means milk produced by a producer in a participating State.
       (3) Federal milk marketing order.--The term ``Federal milk 
     marketing order'' means an order issued under section 8c of 
     the Agricultural Adjustment Act (7 U.S.C. 608c), reenacted 
     with amendments by the Agricultural Marketing Agreement Act 
     of 1937.
       (4) Participating state.--The term ``participating State'' 
     means each State.
       (5) Producer.--The term ``producer'' means an individual or 
     entity that directly or indirectly (as determined by the 
     Secretary)--
       (A) shares in the risk of producing milk; and
       (B) makes contributions (including land, labor, management, 
     equipment, or capital) to the dairy farming operation of the 
     individual or entity that are at least commensurate with the 
     share of the individual or entity of the proceeds of the 
     operation.
       (b) Payments.--The Secretary shall offer to enter into 
     contracts with producers on a dairy farm located in a 
     participating State under which the producers receive 
     payments on eligible production.
       (c) Amount.--Payments to a producer under this section 
     shall be calculated by multiplying (as determined by the 
     Secretary)--
       (1) the payment quantity for the producer during the 
     applicable month established under subsection (d);
       (2) the amount equal to--
       (A) $16.94 per hundredweight; less
       (B) the Class I milk price per hundredweight in Boston 
     under the applicable Federal milk marketing order; by
       (3) 45 percent.
       (d) Payment Quantity.--
       (1) In general.--Subject to paragraph (2), the payment 
     quantity for a producer during the applicable month under 
     this section shall be equal to the quantity of eligible 
     production marketed by the producer during the month.
       (2) Limitation.--The payment quantity for all producers on 
     a single dairy operation during the months of the applicable 
     fiscal year for which the producers receive payments under 
     subsection (b) shall not exceed 2,400,000 pounds. For 
     purposes of determining whether producers are producers on 
     separate dairy operations or a single dairy operation, the 
     Secretary shall apply the same standards as were applied in 
     implementing the dairy program under section 805 of the 
     Agriculture, Rural Development, Food and Drug Administration, 
     and Related Agencies Appropriations Act, 2001 (as enacted 
     into law by Public Law 106-387; 114 Stat. 1549A-50).
       (3) Reconstitution.--The Secretary shall promulgate 
     regulations to ensure that a producer does not reconstitute a 
     dairy operation for the sole purpose of receiving additional 
     payments under this section.
       (e) Payments.--A payment under a contract under this 
     section shall be made on a monthly basis not later than 60 
     days after the last day of the month for which the payment is 
     made.
       (f) Signup.--The Secretary shall offer to enter into 
     contracts under this section during the period beginning on 
     the date that is 60 days after the date of enactment of this 
     Act and ending on September 30, 2005.
       (g) Duration of Contract.--
       (1) In general.--Except as provided in paragraph (2) and 
     subsection (h), any contract entered into by producers on a 
     dairy farm under this section shall cover eligible production 
     marketed by the producers on the dairy farm during the period 
     starting with the first day of month the producers on the 
     dairy farm enter into the contract and ending on September 
     30, 2005.
       (2) Violations.--If a producer violates the contract, the 
     Secretary may--
       (A) terminate the contract and allow the producer to retain 
     any payments received under the contract; or
       (B) allow the contract to remain in effect and require the 
     producer to repay a portion of the payments received under 
     the contract based on the severity of the violation.
       (h) Transition Rule.--In addition to any payment that is 
     otherwise available under this section, if the producers on a 
     dairy farm enter into a contract under this section, the 
     Secretary shall make a payment in accordance with the formula 
     specified in subsection (c) on the quantity of eligible 
     production of the producer marketed during the period 
     beginning on December 1, 2001, and ending on the last day of 
     the month preceding the month the producers on the dairy farm 
     entered into the contract.

     SEC. 1503. DAIRY EXPORT INCENTIVE AND DAIRY INDEMNITY 
                   PROGRAMS.

       (a) Dairy Export Incentive Program.--Section 153(a) of the 
     Food Security Act of 1985 (15 U.S.C. 713a-14(a)) is amended 
     by striking ``2002'' and inserting ``2007''.
       (b) Dairy Indemnity Program.--Section 3 of Public Law 90-
     484 (7 U.S.C. 450l) is amended by striking ``1995'' and 
     inserting ``2007''.

     SEC. 1504. DAIRY PRODUCT MANDATORY REPORTING.

       Section 272(1) of the Agricultural Marketing Act of 1946 (7 
     U.S.C. 1637a(1)) is amended--
       (1) by striking ``means manufactured dairy products'' and 
     inserting ``means--
       ``(A) manufactured dairy products'';
       (2) by striking the period at the end and inserting ``; 
     and''; and
       (3) by adding at the end the following:
       ``(B) substantially identical products designated by the 
     Secretary.''.

     SEC. 1505. FUNDING OF DAIRY PROMOTION AND RESEARCH PROGRAM.

       (a) Definitions.--Section 111 of the Dairy Production 
     Stabilization Act of 1983 (7 U.S.C. 4502) is amended--
       (1) in subsection (k), by striking ``and'' at the end;
       (2) in subsection (l), by striking the period at the end 
     and inserting a semicolon; and
       (3) by adding at the end the following:
       ``(m) the term `imported dairy product' means any dairy 
     product that is imported into the United States (as defined 
     in subsection (l)), including dairy products imported into 
     the United States in the form of--
       ``(1) milk, cream, and fresh and dried dairy products;
       ``(2) butter and butterfat mixtures;
       ``(3) cheese; and
       ``(4) casein and mixtures;
       ``(n) the term `importer' means a person that imports an 
     imported dairy product into the United States; and

[[Page H1816]]

       ``(o) the term `Customs' means the United States Customs 
     Service.''.
       (b) Representation of Importers on Board.--Section 113(b) 
     of the Dairy Production Stabilization Act of 1983 (7 U.S.C. 
     4504(b)) is amended--
       (1) by inserting ``National Dairy Promotion and Research 
     Board.--'' after ``(b)'';
       (2) by designating the first through ninth sentences as 
     paragraphs (1) through (5) and paragraphs (7) through (10), 
     respectively, and indenting the paragraphs appropriately;
       (3) in paragraph (2) (as so designated), by striking 
     ``Members'' and inserting ``Except as provided in paragraph 
     (6), the members'';
       (4) by inserting after paragraph (5) (as so designated) the 
     following:
       ``(6) Importers.--
       ``(A) Initial representation.--In making initial 
     appointments to the Board of importer representatives, the 
     Secretary shall appoint 2 members who represent importers of 
     dairy products and are subject to assessments under the 
     order.
       ``(B) Subsequent representation.--At least once every 3 
     years after the initial appointment of importer 
     representatives under subparagraph (A), the Secretary shall 
     review the average volume of domestic production of dairy 
     products compared to the average volume of imports of dairy 
     products into the United States during the previous 3 years 
     and, on the basis of that review, shall reapportion importer 
     representation on the Board to reflect the proportional share 
     of the United States market by domestic production and 
     imported dairy products.
       ``(C) Additional members; nominations.--The members 
     appointed under this paragraph--
       ``(i) shall be in addition to the total number of members 
     appointed under paragraph (2); and
       ``(ii) shall be appointed from nominations submitted by 
     importers under such procedures as the Secretary determines 
     to be appropriate.''; and
       (5) in paragraph (8) (as so designated), by striking ``is 
     produced'' and inserting ``is produced as well as importers 
     of dairy products''.
       (c) Budgets.--Section 113(e) of the Dairy Production 
     Stabilization Act of 1983 (7 U.S.C. 4504(e)) is amended--
       (1) by striking ``(e)'' and inserting:
       ``(e) Budgets.--
       ``(1) Preparation and submission.--'';
       (2) by striking the last sentence; and
       (3) by adding at the end the following:
       ``(2) Foreign market efforts.--The order shall authorize 
     the Board to expend in the maintenance and expansion of 
     foreign markets an amount not to exceed the amount collected 
     from United States producers for a fiscal year. Of those 
     funds, for each of the 2002 through 2007 fiscal years, the 
     Board's budget may provide for the expenditure of revenues 
     available to the Board to develop international markets for, 
     and to promote within such markets, the consumption of dairy 
     products produced or manufactured in the United States.''.
       (d) Importer Assessment.--Section 113(g) of the Dairy 
     Production Stabilization Act of 1983 (7 U.S.C. 4504(g)) is 
     amended--
       (1) by inserting ``Assessments.--'' after ``(g)'';
       (2) by designating the first through fifth sentences as 
     paragraphs (1) through (5), respectively, and indenting 
     appropriately;
       (3) in paragraph (3) (as so designated)--
       (A) by inserting ``for milk produced in the United States 
     and imported dairy products'' after ``The rate of 
     assessment''; and
       (B) by inserting before the period at the end the 
     following: ``, as determined by the Secretary''; and
       (4) by adding at the end the following:
       ``(6) Importers.--
       ``(A) In general.--The order shall provide that each 
     importer of imported dairy products shall pay an assessment 
     to the Board in the manner prescribed by the order.
       ``(B) Time for payment.--The assessment on imported dairy 
     products shall be paid by the importer to Customs at the time 
     the entry documents are filed with Customs. Customs shall 
     remit the assessments to the Board. For purposes of this 
     subparagraph, the term `importer' includes persons who hold 
     title to foreign-produced dairy products immediately upon 
     release by Customs, as well as persons who act on behalf of 
     others, as agents, brokers, or consignees, to secure the 
     release of dairy products from Customs.
       ``(C) Use of assessments on imported dairy products.--
     Assessments collected on imported dairy products shall not be 
     used for foreign market promotion.''.
       (e) Records.--Section 113(k) of the Dairy Production 
     Stabilization Act of 1983 (7 U.S.C. 4504(k)) is amended in 
     the first sentence by striking ``person receiving'' and 
     inserting ``importer of imported dairy products, each person 
     receiving''.
       (f) Importer Eligibility To Vote in Referendum.--Section 
     116(b) of the Dairy Promotion Stabilization Act of 1983 (7 
     U.S.C. 4507(b)) is amended--
       (1) in the first sentence--
       (A) by inserting after ``of producers'' the following: 
     ``and importers''; and
       (B) by inserting after ``the producers'' the following: 
     ``and importers''; and
       (2) in the second sentence, by inserting after ``commercial 
     use'' the following: ``and importers voting in the referendum 
     (who have been engaged in the importation of dairy products 
     during the same representative period, as determined by the 
     Secretary)''.
       (g) Order Implementation and International Trade 
     Obligations.--Section 112 of the Dairy Promotion 
     Stabilization Act of 1983 (7 U.S.C. 4503) is amended by 
     adding at the end the following:
       ``(d) Order Implementation and International Trade 
     Obligations.--The Secretary, in consultation with the United 
     States Trade Representative, shall ensure that the order is 
     implemented in a manner consistent with the international 
     trade obligations of the Federal Government.''.
       (h) Conforming Amendments To Reflect Addition of 
     Importers.--The Dairy Production Stabilization Act of 1983 is 
     amended--
       (1) in section 110(b) (7 U.S.C. 4501(b))--
       (A) in the first sentence--
       (i) by inserting after ``commercial use'' the following: 
     ``and on imported dairy products''; and
       (ii) by striking ``products produced in the United 
     States.'' and inserting ``products.''; and
       (B) in the second sentence, by inserting after ``produce 
     milk'' the following: ``or the right of any person to import 
     dairy products''; and
       (2) in section 111(d) (7 U.S.C. 4502(d)), by striking 
     ``produced in the United States''.

     SEC. 1506. FLUID MILK PROMOTION.

       (a) Definition of Fluid Milk Product.--Section 1999C of the 
     Fluid Milk Promotion Act of 1990 (7 U.S.C. 6402) is amended 
     by striking paragraph (3) and inserting the following:
       ``(3) Fluid milk product.--The term `fluid milk product' 
     has the meaning given the term in--
       ``(A) section 1000.15 of title 7, Code of Federal 
     Regulations, subject to such amendments as may be made by the 
     Secretary; or
       ``(B) any successor regulation.''.
       (b) Definition of Fluid Milk Processor.--Section 1999C(4) 
     of the Fluid Milk Promotion Act of 1990 (7 U.S.C. 6402(4)) is 
     amended by striking ``500,000 pounds of fluid milk products 
     in consumer-type packages per month'' and inserting 
     ``3,000,000 pounds of fluid milk products in consumer-type 
     packages per month (excluding products delivered directly to 
     the place of residence of a consumer)''.
       (c) Elimination of Order Termination Date.--Section 1999O 
     of the Fluid Milk Promotion Act of 1990 (7 U.S.C. 6414) is 
     amended--
       (1) by striking subsection (a); and
       (2) by redesignating subsections (b) and (c) as subsections 
     (a) and (b), respectively.

     SEC. 1507. STUDY OF NATIONAL DAIRY POLICY.

       (a) Study Required.--The Secretary of Agriculture shall 
     conduct a comprehensive economic evaluation of the potential 
     direct and indirect effects of the various elements of the 
     national dairy policy, including an examination of the effect 
     of the national dairy policy on--
       (1) farm price stability, farm profitability and viability, 
     and local rural economies in the United States;
       (2) child, senior, and low-income nutrition programs, 
     including impacts on schools and institutions participating 
     in the programs, on program recipients, and other factors; 
     and
       (3) the wholesale and retail cost of fluid milk, dairy 
     farms, and milk utilization.
       (b) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall submit to the 
     Committee on Agriculture of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate a report describing the results of the study required 
     by this section.
       (c) National Dairy Policy Defined.--In this section, the 
     term ``national dairy policy'' means the dairy policy of the 
     United States as evidenced by the following policies and 
     programs:
       (1) Federal milk marketing orders issued under section 8c 
     of the Agricultural Adjustment Act (7 U.S.C. 608c), reenacted 
     with amendments by the Agricultural Marketing Act of 1937.
       (2) Interstate dairy compacts (including proposed compacts 
     described in H.R. 1827 and S. 1157, as introduced in the 
     107th Congress).
       (3) Over-order premiums and State pricing programs.
       (4) Direct payments to milk producers.
       (5) Federal milk price support program established under 
     section 1401.
       (6) Export programs regarding milk and dairy products, such 
     as the dairy export incentive program established under 
     section 153 of the Food Security Act of 1985 (15 U.S.C. 713a-
     14).

     SEC. 1508. STUDIES OF EFFECTS OF CHANGES IN APPROACH TO 
                   NATIONAL DAIRY POLICY AND FLUID MILK IDENTITY 
                   STANDARDS.

       (a) Federal Dairy Policy Changes.--The Secretary of 
     Agriculture shall conduct a study of the effects of--
       (1) terminating all Federal programs relating to price 
     support and supply management for milk; and
       (2) granting the consent of Congress to cooperative efforts 
     by States to manage milk prices and supply.
       (b) Fluid Milk Identity Standards.--The Secretary shall 
     conduct a study of the effects of including in the standard 
     of identity for fluid milk a required minimum protein content 
     that is commensurate with the average nonfat solids content 
     of bovine milk produced in the United States.
       (c) Reports.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall submit to the 
     Committee on Agriculture of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate a report describing the results of the studies 
     required by this section.
                       Subtitle F--Administration

     SEC. 1601. ADMINISTRATION GENERALLY.

       (a) Use of Commodity Credit Corporation.--The Secretary 
     shall use the funds, facilities, and authorities of the 
     Commodity Credit Corporation to carry out this title.
       (b) Determinations by Secretary.--A determination made by 
     the Secretary under this title shall be final and conclusive.
       (c) Regulations.--
       (1) In general.--Not later than 90 days after the date of 
     the enactment of this Act, the Secretary and the Commodity 
     Credit Corporation, as appropriate, shall promulgate such 
     regulations as are necessary to implement this title.
       (2) Procedure.--The promulgation of the regulations and 
     administration of this title shall be made without regard 
     to--

[[Page H1817]]

       (A) chapter 35 of title 44, United States Code (commonly 
     know as the ``Paperwork Reduction Act'');
       (B) the Statement of Policy of the Secretary of Agriculture 
     effective July 24, 1971 (36 Fed. Reg. 13804), relating to 
     notices of proposed rulemaking and public participation in 
     rulemaking; and
       (C) the notice and comment provisions of section 553 of 
     title 5, United States Code.
       (3) Congressional review of agency rulemaking.--In carrying 
     out this subsection, the Secretary shall use the authority 
     provided under section 808 of title 5, United States Code.
       (d) Treatment of Advance Payment Option.--The protection 
     that was afforded producers that had an option to elect to 
     accelerate the receipt of any payment under a production 
     flexibility contract payable under the Federal Agriculture 
     Improvement and Reform Act of 1996, as provided by section 
     525 of Public 106-170 (113 Stat. 1928; 7 U.S.C. 7212 note), 
     shall also apply to the option to receive--
       (1) the advance payment of direct payments and counter-
     cyclical payments under subtitle A and subtitle C; and
       (2) the single payment of compensation for eligible peanut 
     quota holders under section 1310.
       (e) Adjustment Authority Related to Uruguay Round 
     Compliance.--
       (1) Required determination; adjustment.--If the Secretary 
     determines that expenditures under subtitles A through E that 
     are subject to the total allowable domestic support levels 
     under the Uruguay Round Agreements (as defined in section 2 
     of the Uruguay Round Agreements Act (19 U.S.C. 3501)), as in 
     effect on the date of enactment of this Act, will exceed such 
     allowable levels for any applicable reporting period, the 
     Secretary shall, to the maximum extent practicable, make 
     adjustments in the amount of such expenditures during that 
     period to ensure that such expenditures do not exceed such 
     allowable levels.
       (2) Congressional notification.--Before making any 
     adjustment under paragraph (1), the Secretary shall submit to 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate and the Committee on Agriculture of the House of 
     Representatives a report describing the determination made 
     under that paragraph and the extent of the adjustment to be 
     made.

     SEC. 1602. SUSPENSION OF PERMANENT PRICE SUPPORT AUTHORITY.

       (a) Agricultural Adjustment Act of 1938.--The following 
     provisions of the Agricultural Adjustment Act of 1938 shall 
     not be applicable to the 2002 through 2007 crops of covered 
     commodities, peanuts, and sugar and shall not be applicable 
     to milk during the period beginning on the date of enactment 
     of this Act through December 31, 2007:
       (1) Parts II through V of subtitle B of title III (7 U.S.C. 
     1326-1351).
       (2) In the case of upland cotton, section 377 (7 U.S.C. 
     1377).
       (3) Subtitle D of title III (7 U.S.C. 1379a-1379j).
       (4) Title IV (7 U.S.C. 1401-1407).
       (b) Agricultural Act of 1949.--The following provisions of 
     the Agricultural Act of 1949 shall not be applicable to the 
     2002 through 2007 crops of covered commodities, peanuts, and 
     sugar and shall not be applicable to milk during the period 
     beginning on the date of enactment of this Act and through 
     December 31, 2007:
       (1) Section 101 (7 U.S.C. 1441).
       (2) Section 103(a) (7 U.S.C. 1444(a)).
       (3) Section 105 (7 U.S.C. 1444b).
       (4) Section 107 (7 U.S.C. 1445a).
       (5) Section 110 (7 U.S.C. 1445e).
       (6) Section 112 (7 U.S.C. 1445g).
       (7) Section 115 (7 U.S.C. 1445k).
       (8) Section 201 (7 U.S.C. 1446).
       (9) Title III (7 U.S.C. 1447-1449).
       (10) Title IV (7 U.S.C. 1421-1433d), other than sections 
     404, 412, and 416 (7 U.S.C. 1424, 1429, and 1431).
       (11) Title V (7 U.S.C. 1461-1469).
       (12) Title VI (7 U.S.C. 1471-1471j).
       (c) Suspension of Certain Quota Provisions.--The joint 
     resolution entitled ``A joint resolution relating to corn and 
     wheat marketing quotas under the Agricultural Adjustment Act 
     of 1938, as amended'', approved May 26, 1941 (7 U.S.C. 1330 
     and 1340), shall not be applicable to the crops of wheat 
     planted for harvest in the calendar years 2002 through 2007.
       (d) Conforming Amendment.--Section 171(a)(1) of the Federal 
     Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 
     7301(a)(1)) is amended by striking ``2002'' the first place 
     appears and inserting ``2001''.

     SEC. 1603. PAYMENT LIMITATIONS.

       (a) Limitation on Amounts Received.--Section 1001 of the 
     Food Security Act of 1985 (7 U.S.C. 1308) is amended by 
     striking the section heading, ``Sec. 1001.'', and all that 
     follows through the end of paragraph (4) and inserting the 
     following:

     ``SEC. 1001. PAYMENT LIMITATIONS.

       ``(a) Definitions.--In this section:
       ``(1) Covered commodity.--The term `covered commodity' has 
     the meaning given that term in section 1001 of the Farm 
     Security and Rural Investment Act of 2002.
       ``(2) Loan commodity.--The term `loan commodity' has the 
     meaning given that term in section 1001 of the Farm Security 
     and Rural Investment Act of 2002, except that the term does 
     not include wool, mohair, or honey.
       ``(3) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture.
       ``(b) Limitation on Direct Payments.--
       ``(1) Covered commodities.--The total amount of direct 
     payments made to a person during any crop year under subtitle 
     A of title I of the Farm Security and Rural Investment Act of 
     2002 for 1 or more covered commodities may not exceed 
     $40,000.
       ``(2) Peanuts.--The total amount of direct payments made to 
     a person during any crop year under subtitle C of title I of 
     the Farm Security and Rural Investment Act of 2002 may not 
     exceed $40,000.
       ``(c) Limitation on Counter-Cyclical Payments.--
       ``(1) Covered commodities.--The total amount of counter-
     cyclical payments made to a person during any crop year under 
     subtitle A of title I of the Farm Security and Rural 
     Investment Act of 2002 for 1 or more covered commodities may 
     not exceed $65,000.
       ``(2) Peanuts.--The total amount of counter-cyclical 
     payments made to a person during any crop year under subtitle 
     C of title I of the Farm Security and Rural Investment Act of 
     2002 may not exceed $65,000.
       ``(d) Limitation on Marketing Loan Gains and Loan 
     Deficiency Payments.--
       ``(1) Loan commodities.--The total amount of the following 
     gains and payments that a person may receive during any crop 
     year may not exceed $75,000:
       ``(A) Any gain realized by a producer from repaying a 
     marketing assistance loan for 1 or more loan commodities 
     under subtitle B of title I of the Farm Security and Rural 
     Investment Act of 2002 at a lower level than the original 
     loan rate established for the loan commodity under that 
     subtitle.
       ``(B) Any loan deficiency payments received for 1 or more 
     loan commodities under that subtitle.
       ``(2) Other commodities.--The total amount of the following 
     gains and payments that a person may receive during any crop 
     year may not exceed $75,000:
       ``(A) Any gain realized by a producer from repaying a 
     marketing assistance loan for peanuts, wool, mohair, or honey 
     under subtitle B or C of title I of the Farm Security and 
     Rural Investment Act of 2002 at a lower level than the 
     original loan rate established for the commodity under those 
     subtitles.
       ``(B) Any loan deficiency payments received for peanuts, 
     wool, mohair, and honey under those subtitles.''.
       (b) Clerical and Conforming Amendments to Section 1001.--
     Section 1001 of the Food Security Act of 1985 (7 U.S.C. 1308) 
     is amended--
       (1) in paragraph (5)--
       (A) by striking ``(5)'' and inserting ``(e) Definition of 
     Person.--''
       (B) by redesignating subparagraphs (A) through (E) as 
     paragraphs (1) through (5), respectively;
       (C) in paragraph (1), as so redesignated--
       (i) by redesignating clauses (i) and (ii) as subparagraphs 
     (A) and (B), respectively; and
       (ii) by striking the second sentence; and
       (D) in paragraph (2), as so redesignated--
       (i) by redesignating clause (i) as subparagraph (A) and, in 
     such subparagraph (as so redesignated)--

       (I) by striking ``subparagraph (A), subject to clause 
     (ii)'' and inserting ``paragraph (1), subject to subparagraph 
     (B)''; and
       (II) by redesignating subclauses (I), (II), and (III), as 
     clauses (i), (ii), and (iii), respectively;

       (ii) by redesignating clause (ii) as subparagraph (B) and, 
     in such subparagraph (as so redesignated), by redesignating 
     subclauses (I), (II), and (III), as clauses (i), (ii), and 
     (iii), respectively; and
       (iii) by redesignating clause (iii) as subparagraph (C) 
     and, in such subparagraph (as so redesignated)--

       (I) by striking ``as described in paragraphs (1) and (2)'' 
     and inserting ``as described in subsections (b), (c), and 
     (d)''; and
       (II) by redesignating subclauses (I) and (II) as clauses 
     (i) and (ii), respectively;

       (2) in paragraph (6), by striking ``(6)'' and inserting 
     ``(f) Public Schools.--''; and
       (3) in paragraph (7), by striking ``(7)'' and inserting 
     ``(g) Time Limits; Reliance.--''.
       (c) Conforming Amendments to Other laws.--
       (1) Section 1001A of the Food Security Act of 1985 (7 
     U.S.C. 1308-1) is amended--
       (A) in subsections (a)(1) and (b)(2)(B), by striking 
     ``section 1001(5)(B)(i)(II)'' and inserting ``section 
     1001(e)(2)(A)(ii)''; and
       (B) in subsections (a)(1) and (b)(1), by striking ``section 
     1001(5)(B)(i)'' and inserting ``section 1001(e)(2)(A)''; and
       (2) Section 1001B of the Food Security Act of 1985 (7 
     U.S.C. 1308-2) is amended by striking ``as described in 
     paragraphs (1) and (2)'' and inserting ``as described in 
     subsections (b), (c), and (d)''.
       (3) Section 1001C(a) of the Food Security Act of 1985 (7 
     U.S.C. 1308-3(a)) is amended by inserting ``title I of the 
     Farm Security and Rural Investment Act of 2002,'' after 
     ``made available under''.
       (d) Transition.--Section 1001 of the Food Security Act of 
     1985 (7 U.S.C. 1308), as in effect on the day before the date 
     of the enactment of this Act, shall continue to apply with 
     respect to the 2001 crop of any covered commodity.

     SEC. 1604. ADJUSTED GROSS INCOME LIMITATION.

       The Food Security Act of 1985 is amended--
       (1) by redesignating section 1001D (7 U.S.C. 1308-4) and 
     section 1001E (7 U.S.C. 1308-5) as sections 1001E and 1001F, 
     respectively; and
       (2) by inserting after section 1001C (7 U.S.C. 1308-3) the 
     following:

     ``SEC. 1001D. ADJUSTED GROSS INCOME LIMITATION.

       ``(a) Definition of Average Adjusted Gross Income.--
       ``(1) In general.--In this section, the term `average 
     adjusted gross income', with respect to an individual or 
     entity (for purposes of this section, as defined in section 
     1001(e)(2)(A)(ii)), means the 3-year average of the adjusted 
     gross income or comparable measure of the individual or 
     entity over the 3 preceding tax years, as determined by the 
     Secretary.

[[Page H1818]]

       ``(2) Special rules for certain individuals and entities.--
     In the case of an entity that is not required to file a 
     Federal income tax return or an individual or entity that did 
     not have taxable income in 1 or more of the tax years used to 
     determine the average under paragraph (1), the Secretary 
     shall provide, by regulation, a method for determining the 
     average adjusted gross income of the individual or entity for 
     purposes of this section.
       ``(b) Limitation.--
       ``(1) In general.--Notwithstanding any other provision of 
     law, an individual or entity shall not be eligible to receive 
     any benefit described in paragraph (2) during a crop year if 
     the average adjusted gross income of the individual or entity 
     exceeds $2,500,000, unless not less than 75 percent of the 
     average adjusted gross income of the individual or entity is 
     derived from farming, ranching, or forestry operations, as 
     determined by the Secretary.
       ``(2) Covered benefits.--Paragraph (1) applies with respect 
     to the following:
       ``(A) A direct payment or counter-cyclical payment under 
     subtitle A or C of title I of the Farm Security and Rural 
     Investment Act of 2002.
       ``(B) A marketing loan gain or payment described in section 
     1001(d) of this Act.
       ``(C) A payment under any program under title XII of this 
     Act or title II of the Farm Security and Rural Investment Act 
     of 2002.
       ``(c) Certification.--To comply with the limitation under 
     subsection (b), an individual or entity shall provide to the 
     Secretary--
       ``(1) a certification by a certified public accountant or 
     another third party that is acceptable to the Secretary that 
     the average adjusted gross income of the individual or entity 
     does not exceed the limitation specified in that subsection; 
     or
       ``(2) information and documentation regarding the adjusted 
     gross income of the individual or entity through other 
     procedures established by the Secretary.
       ``(d) Commensurate Reduction.--In the case of a benefit 
     described in subsection (b)(2) made in a crop year to an 
     entity, general partnership, or joint venture, the amount of 
     the benefit shall be reduced by an amount that is 
     commensurate with the direct and indirect ownership interest 
     in the entity, general partnership, or joint venture of each 
     individual who has an average adjusted gross income in excess 
     of the limitation specified in subsection (b) for the average 
     of the 3 preceding crop years.
       ``(e) Effective Period.--This section shall apply only 
     during the 2003 through 2007 crop years.''.

     SEC. 1605. COMMISSION ON APPLICATION OF PAYMENT LIMITATIONS.

       (a) Establishment.--There is established a commission to be 
     known as the ``Commission on the Application of Payment 
     Limitations for Agriculture'' (referred to in this section as 
     the ``Commission'').
       (b) Duties.--The Commission shall conduct a study on the 
     potential impacts of further payment limitations on the 
     receipt of direct payments, counter-cyclical payments, and 
     marketing loan gains and loan deficiency payments on--
       (1) farm income;
       (2) land values;
       (3) rural communities;
       (4) agribusiness infrastructure;
       (5) planting decisions of producers affected; and
       (6) supply and prices of covered commodities, loan 
     commodities, specialty crops (including fruits and 
     vegetables), and other agricultural commodities.
       (c) Membership.--
       (1) Composition.--The Commission shall be composed of 10 
     members as follows:
       (A) 3 members appointed by the Secretary.
       (B) 3 members appointed by the Committee on Agriculture, 
     Nutrition, and Forestry of the Senate.
       (C) 3 members appointed by the Committee on Agriculture of 
     the House of Representatives.
       (D) The Chief Economist of the Department of Agriculture.
       (2) Federal government employment.--The membership of the 
     Commission may include 1 or more employees of the Department 
     of Agriculture or other Federal agencies.
       (3) Date of appointments.--The appointment of a member of 
     the Commission shall be made not later than 60 days after the 
     date of enactment of this Act.
       (4) Term; vacancies.--
       (A) Term.--A member shall be appointed for the life of the 
     Commission.
       (B) Vacancies.--A vacancy on the Commission--
       (i) shall not affect the powers of the Commission; and
       (ii) shall be filled in the same manner as the original 
     appointment was made.
       (5) Initial meeting.--Not later than 30 days after the date 
     on which all members of the Commission have been appointed, 
     the Commission shall hold the initial meeting of the 
     Commission.
       (d) Quorum.--A majority of the members of the Commission 
     shall constitute a quorum for the transaction of business, 
     but a lesser number of members may hold hearings.
       (e) Chairperson.--The Secretary shall appoint 1 of the 
     members of the Commission to serve as Chairperson of the 
     Commission.
       (f) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Commission shall submit to the 
     President, the Committee on Agriculture of the House of 
     Representatives, and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate a report containing the results of 
     the study required by subsection (b), including such 
     recommendations as the Commission considers appropriate.
       (g) Hearings.--The Commission may hold such hearings, meet 
     and act at such times and places, take such testimony, and 
     receive such evidence as the Commission considers advisable 
     to carry out this section.
       (h) Information From Federal Agencies.--The Commission may 
     secure directly from a Federal agency such information as the 
     Commission considers necessary to carry out this section. On 
     request of the Chairperson of the Commission, the head of the 
     agency shall provide the information to the Commission.
       (i) Postal Services.--The Commission may use the United 
     States mails in the same manner and under the same conditions 
     as other agencies of the Federal Government.
       (j) Assistance From Secretary.--The Secretary may provide 
     to the Commission appropriate office space and such 
     reasonable administrative and support services as the 
     Commission may request.
       (k) Compensation of Members.--
       (1) Non-federal employees.--A member of the Commission who 
     is not an officer or employee of the Federal Government shall 
     be compensated at a rate equal to the daily equivalent of the 
     annual rate of basic pay prescribed for level IV of the 
     Executive Schedule under section 5315 of title 5, United 
     States Code, for each day (including travel time) during 
     which the member is engaged in the performance of the duties 
     of the Commission.
       (2) Federal employees.--A member of the Commission who is 
     an officer or employee of the Federal Government shall serve 
     without compensation in addition to the compensation received 
     for the services of the member as an officer or employee of 
     the Federal Government.
       (3) Travel Expenses.--A member of the Commission shall be 
     allowed travel expenses, including per diem in lieu of 
     subsistence, at rates authorized for an employee of an agency 
     under subchapter I of chapter 57 of title 5, United States 
     Code, while away from the home or regular place of business 
     of the member in the performance of the duties of the 
     Commission.
       (l) Federal Advisory Committee Act.--The Federal Advisory 
     Committee Act (5 U.S.C. App.) shall not apply to the 
     Commission or any proceeding of the Commission.

     SEC. 1606. ADJUSTMENTS OF LOANS.

       Section 162(b) of the Federal Agriculture Improvement and 
     Reform Act of 1996 (7 U.S.C. 7282(b)) is amended by striking 
     ``this title'' and inserting ``this title and title I of the 
     Farm Security and Rural Investment Act of 2002''.

     SEC. 1607. PERSONAL LIABILITY OF PRODUCERS FOR DEFICIENCIES.

       Section 164 of the Federal Agriculture Improvement and 
     Reform Act of 1996 (7 U.S.C. 7284) is amended by striking 
     ``this title'' each places it appears and inserting ``this 
     title and title I of the Farm Security and Rural Investment 
     Act of 2002''.

     SEC. 1608. EXTENSION OF EXISTING ADMINISTRATIVE AUTHORITY 
                   REGARDING LOANS.

       Section 166 of the Federal Agriculture Improvement and 
     Reform Act of 1996 (7 U.S.C. 7286) is amended--
       (1) in subsection (a), by striking ``subtitle C'' and 
     inserting ``subtitle C of this title and subtitle B and C of 
     title I of the Farm Security and Rural Investment Act of 
     2002''; and
       (2) in subsection (c)(1), by striking ``subtitle C'' and 
     inserting ``subtitle C of this title and subtitle B and C of 
     title I of the Farm Security and Rural Investment Act of 
     2002''.

     SEC. 1609. COMMODITY CREDIT CORPORATION INVENTORY.

       Section 5 of the Commodity Credit Corporation Charter Act 
     (15 U.S.C. 714c) is amended in the last sentence by inserting 
     before the period at the end the following: ``(including, at 
     the option of the Corporation, the use of private sector 
     entities)''.

     SEC. 1610. RESERVE STOCK LEVEL.

       Section 301(b)(14)(C) of the Agricultural Adjustment Act of 
     1938 (7 U.S.C. 1301(b)(14)(C)) is amended--
       (1) in clause (i), by striking ``100,000,000'' and 
     inserting ``60,000,000''; and
       (2) in clause (ii), by striking ``15 percent'' and 
     inserting ``10 percent''.

     SEC. 1611. FARM RECONSTITUTIONS.

       (a) In General.--Section 316(a)(1)(A)(ii) of the 
     Agricultural Adjustment Act of 1938 (7 U.S.C. 
     1314b(a)(1)(A)(ii)) is amended by adding at the end the 
     following: ``Notwithstanding any other provision of law, for 
     the 2002 crop only, the Secretary shall allow special farm 
     reconstitutions, in lieu of lease and transfer of allotments 
     and quotas, under this section, in accordance with such 
     conditions as are established by the Secretary.''.
       (b) Study.--
       (1) In general.--The Secretary shall conduct a study on the 
     effects on the limitation on producers to move quota to a 
     farm other than the farm to which the quota was initially 
     assigned under part I of subtitle B of title III of the 
     Agricultural Adjustment Act of 1938 (7 U.S.C. 1311 et seq.).
       (2) Report.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary shall submit to the 
     Committee on Agriculture of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate a report on the results of the study.

     SEC. 1612. ASSIGNMENT OF PAYMENTS.

       The provisions of section 8(g) of the Soil Conservation and 
     Domestic Allotment Act (16 U.S.C. 590h(g)), relating to 
     assignment of payments, shall apply to payments made under 
     the authority of this Act. The producer making the 
     assignment, or the assignee, shall provide the Secretary with 
     notice, in such manner as the Secretary may require, of any 
     assignment made under this section.

     SEC. 1613. EQUITABLE RELIEF FROM INELIGIBILITY FOR LOANS, 
                   PAYMENTS, OR OTHER BENEFITS.

       (a) Definitions.--In this section:
       (1) Agricultural commodity.--The term ``agricultural 
     commodity'' means any agricultural commodity, food, feed, 
     fiber, or livestock that is subject to a covered program.

[[Page H1819]]

       (2) Covered program.--
       (A) In general.--The term ``covered program'' means--
       (i) a program administered by the Secretary under which 
     price or income support, or production or market loss 
     assistance, is provided to producers of agricultural 
     commodities; and
       (ii) a conservation program administered by the Secretary.
       (B) Exclusions.--The term ``covered program'' does not 
     include--
       (i) an agricultural credit program carried out under the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 1921 et 
     seq.); or
       (ii) the crop insurance program carried out under the 
     Federal Crop Insurance Act (7 U.S.C. 1501 et seq.).
       (3) Participant.--The term ``participant'' means a 
     participant in a covered program.
       (4) State conservationist.--The term ``State 
     Conservationist'' means the State Conservationist with 
     respect to a program administered by the Natural Resources 
     Conservation Service.
       (5) State director.--The term ``State Director'' means the 
     State Executive Director of the Farm Service Agency with 
     respect to a program administered by the Farm Service Agency.
       (b) Equitable Relief.--The Secretary may provide relief to 
     any participant that is determined to be not in compliance 
     with the requirements of a covered program, and therefore 
     ineligible for a loan, payment, or other benefit under the 
     covered program, if the participant--
       (1) acting in good faith, relied on the action or advice of 
     the Secretary (including any authorized representative of the 
     Secretary) to the detriment of the participant; or
       (2) failed to comply fully with the requirements of the 
     covered program, but made a good faith effort to comply with 
     the requirements.
       (c) Forms of Relief.--The Secretary may authorize a 
     participant in a covered program to--
       (1) retain loans, payments, or other benefits received 
     under the covered program;
       (2) continue to receive loans, payments, and other benefits 
     under the covered program;
       (3) continue to participate, in whole or in part, under any 
     contract executed under the covered program;
       (4) in the case of a conservation program, reenroll all or 
     part of the land covered by the program; and
       (5) receive such other equitable relief as the Secretary 
     determines to be appropriate.
       (d) Remedial Action.--As a condition of receiving relief 
     under this section, the Secretary may require the participant 
     to take actions designed to remedy any failure to comply with 
     the covered program.
       (e) Equitable Relief by State Directors and State 
     Conservationists.--
       (1) In general.--A State Director, in the case of programs 
     administered by the State Director, and the State 
     Conservationist, in the case of programs administered by the 
     State Conservationist, may grant relief to a participant in 
     accordance with subsections (b) through (d) if--
       (A) the amount of loans, payments, and benefits for which 
     relief will be provided to the participant under this 
     subsection is less than $20,000;
       (B) the total amount of loans, payments, and benefits for 
     which relief has been previously provided to the participant 
     under this subsection is not more than $5,000; and
       (C) the total amount of loans, payments, and benefits for 
     which relief is provided to similarly situated participants 
     under this subsection is not more than $1,000,000, as 
     determined by the Secretary.
       (2) Consultation, approval, and reversal.--The decision by 
     a State Director or State Conservationist to grant relief 
     under this subsection--
       (A) shall not require prior approval by the Administrator 
     of the Farm Service Agency, the Chief of the Natural 
     Resources Conservation Service, or any other officer or 
     employee of the Agency or Service;
       (B) shall be made only after consultation with, and the 
     approval of, the Office of General Counsel of the Department 
     of Agriculture; and
       (C) is subject to reversal only by the Secretary (who may 
     not delegate the reversal authority).
       (3) Nonapplicability.--The authority of a State Director or 
     State Conservationist under this subsection does not apply to 
     the administration of--
       (A) payment limitations under--
       (i) sections 1001 through 1001F of the Food Security Act of 
     1985 (7 U.S.C. 1308 et seq.); or
       (ii) a conservation program administered by the Secretary.
       (B) highly erodible land and wetland conservation 
     requirements under subtitle B or C of title XII of the Food 
     Security Act of 1985 (16 U.S.C. 3811 et seq.).
       (4) Other authority.--The authority provided to a State 
     Director and State Conservationist under this subsection is 
     in addition to any other applicable authority and does not 
     limit other authority provided by law or the Secretary.
       (f) Judicial Review.--A discretionary decision by the 
     Secretary, the State Director, or the State Conservationist 
     under this section shall be final, and shall not be subject 
     to review under chapter 7 of title 5, United States Code.
       (g) Reports.--Not later than February 1 of each year, the 
     Secretary shall submit to the Committee on Agriculture of the 
     House of Representatives and the Committee on Agriculture, 
     Nutrition, and Forestry of the Senate a report that describes 
     for the previous calendar year--
       (1) the number of requests for equitable relief under 
     subsections (b) and (e) and the disposition of the requests; 
     and
       (2) the number of requests for equitable relief under 
     section 278(d) of the Department of Agriculture 
     Reorganization Act of 1994 (7 U.S.C. 6998(d)) and the 
     disposition of the requests.
       (h) Relationship to Other Law.--The authority provided in 
     this section is in addition to any other authority provided 
     in this or any other Act.
       (i) Finality Rule.--Section 281(a) of the Department of 
     Agriculture Reorganization Act of 1994 (7 U.S.C. 7001(a)) is 
     amended--
       (1) by striking ``Consolidated Farm Service Agency'' each 
     place it appears and inserting ``Farm Service Agency'';
       (2) in paragraph (1)--
       (A) by striking ``This subsection'' and inserting the 
     following:
       ``(A) In general.--Except as provided in subparagraph (B), 
     this subsection''; and
       (B) by adding at the end the following:
       ``(B) Nonapplicability.--This subsection does not apply 
     to--
       ``(i) a function performed under section 376 of the 
     Consolidated Farm and Rural Development Act; or
       ``(ii) a function performed under a conservation program 
     administered by the Natural Resources Conservation 
     Service.''; and
       (3) in paragraph (2), by inserting ``, before the end of 
     the 90-day period,'' after ``unless the decision''.
       (j) Conforming Amendments.--
       (1) Section 326 of the Food and Agriculture Act of 1962 (7 
     U.S.C. 1339a) is repealed.
       (2) Section 278(d) of the Department of Agriculture 
     Reorganization Act of 1994 (7 U.S.C. 6998(d)) is amended in 
     the first sentence by striking ``section 326 of the Food and 
     Agriculture Act of 1962 (7 U.S.C. 1339a)'' and inserting 
     ``section 1613 of the Farm Security and Rural Investment Act 
     of 2002''.
       (3) Section 1230A of the Food Security Act of 1985 (16 
     U.S.C. 3830a) is repealed.

     SEC. 1614. TRACKING OF BENEFITS.

       As soon as practicable after the date of enactment of this 
     Act, the Secretary shall establish procedures to track the 
     benefits provided, directly or indirectly, to individuals and 
     entities under titles I and II and the amendments made by 
     those titles.

     SEC. 1615. ESTIMATES OF NET FARM INCOME.

       In each issuance of projections of net farm income, the 
     Secretary shall include (as determined by the Secretary)--
       (1) an estimate of the net farm income earned by commercial 
     producers in the United States; and
       (2) an estimate of the net farm income attributable to 
     commercial producers of each of the following:
       (A) Livestock.
       (B) Loan commodities.
       (C) Agricultural commodities other than loan commodities.

     SEC. 1616. AVAILABILITY OF INCENTIVE PAYMENTS FOR CERTAIN 
                   PRODUCERS.

       (a) Incentive Payments Required.--Subject to subsection 
     (b), the Secretary shall make available a total of 
     $20,000,000 of funds of the Commodity Credit Corporation 
     during the 2003 through 2005 crop years to provide incentive 
     payments to producers of hard white wheat.
       (b) Conditions on Implementation.--The Secretary shall 
     implement subsection (a)--
       (1) only with regard to production that meets minimum 
     quality criteria; and
       (2) on not more than 2,000,000 acres or the equivalent 
     volume of production.
       (c) Demand for Wheat.--To be eligible to obtain an 
     incentive payment under subsection (a), a producer shall 
     demonstrate to the satisfaction of the Secretary that buyers 
     and end-users are available for the wheat to be covered by 
     the incentive payment.

     SEC. 1617. RENEWED AVAILABILITY OF MARKET LOSS ASSISTANCE AND 
                   CERTAIN EMERGENCY ASSISTANCE TO PERSONS THAT 
                   FAILED TO RECEIVE ASSISTANCE UNDER EARLIER 
                   AUTHORITIES.

       (a) Authority to Provide Assistance.--The Secretary of 
     Agriculture may use such funds of the Commodity Credit 
     Corporation as are necessary to provide market loss 
     assistance and other emergency assistance under a provision 
     of law specified in subsection (c) to persons that, as 
     determined by the Secretary)--
       (1) were eligible to receive the assistance under the 
     provision of law; but
       (2) did not receive the assistance before October 1, 2001.
       (b) Limitation.--The amount of assistance provided under a 
     provision of law specified in subsection (c) and this section 
     to a person shall not exceed the amount of assistance the 
     person would have been eligible to receive under the 
     provision had the claim of the producer under the provision 
     been timely resolved.
       (c) Covered Market Loss Assistance Authorities.--The 
     following provisions of law are covered by this section:
       (1) Sections 1, 2, 3, 4, and 5 of Public Law 107-25 (115 
     Stat. 201).
       (2) Sections 805, 806, and 814 of the Agriculture, Rural 
     Development, Food and Drug Administration, and Related 
     Agencies Appropriations Act, 2001 (as enacted into law by 
     Public Law 106-387; 114 Stat. 1549).
       (3) Sections 201, 202, 204(a), 204(d), 257, and 259 of the 
     Agricultural Risk Protection Act of 2000 (Public Law 106-224; 
     7 U.S.C. 1421 note).
       (4) Sections 802, 803(a), 804, and 805 of the Agriculture, 
     Rural Development, Food and Drug Administration, and Related 
     Agencies Appropriations Act, 2000 (Public Law 106-78; 113 
     Stat. 1135).
       (5) The livestock indemnity program under the heading 
     ``Commodity Credit Corporation Fund'' in chapter 1 of title I 
     of the 1999 Emergency Supplemental Appropriations Act (Public 
     106-31; 113 Stat. 59).
       (6) Section 1111(a) of the Agriculture, Rural Development, 
     Food and Drug Administration, and Related Agencies 
     Appropriations Act, 1999 (as contained in section 101(a) of 
     division A of Public Law 105-277; 112 Stat. 2681-44).

[[Page H1820]]

     SEC. 1618. PRODUCER RETENTION OF ERRONEOUSLY PAID LOAN 
                   DEFICIENCY PAYMENTS AND MARKETING LOAN GAINS.

       Notwithstanding any other provision of law, the Secretary 
     and the Commodity Credit Corporation shall not require 
     producers in Erie County, Pennsylvania, to repay loan 
     deficiency payments and marketing loan gains erroneously paid 
     or determined to have been earned by the Commodity Credit 
     Corporation for certain 1998 and 1999 crops under subtitle C 
     of title I of the Federal Agriculture Improvement and Reform 
     Act of 1996 (7 U.S.C. 7231 et seq.). In the case of a 
     producer who has already made the repayment on or before the 
     date of the enactment of this Act, the Commodity Credit 
     Corporation shall reimburse the producer for the full amount 
     of the repayment.
                         TITLE II--CONSERVATION
                   Subtitle A--Conservation Security

     SEC. 2001. CONSERVATION SECURITY PROGRAM.

       (a) In General.--Subtitle D of title XII of the Food 
     Security Act of 1985 (16 U.S.C. 3830 et seq.) is amended by 
     inserting after chapter 1 the following:

       ``CHAPTER 2--CONSERVATION SECURITY AND FARMLAND PROTECTION

             ``Subchapter A--Conservation Security Program

     ``SEC. 1238. DEFINITIONS.

       ``In this subchapter:
       ``(1) Base payment.--The term `base payment' means an 
     amount that is--
       ``(A) determined in accordance with the rate described in 
     section 1238C(b)(1)(A); and
       ``(B) paid to a producer under a conservation security 
     contract in accordance with clause (i) of subparagraph (C), 
     (D), or (E) of section 1238C(b)(1), as appropriate.
       ``(2) Beginning farmer or rancher.--The term `beginning 
     farmer or rancher' has the meaning given the term under 
     section 343(a) of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1991(a)).
       ``(3) Conservation practice.--The term `conservation 
     practice' means a conservation farming practice described in 
     section 1238A(d)(4) that--
       ``(A) requires planning, implementation, management, and 
     maintenance; and
       ``(B) promotes 1 or more of the purposes described in 
     section 1238A(a).
       ``(4) Conservation security contract.--The term 
     `conservation security contract' means a contract described 
     in section 1238A(e).
       ``(5) Conservation security plan.--The term `conservation 
     security plan' means a plan described in section 1238A(c).
       ``(6) Conservation security program.--The term 
     `conservation security program' means the program established 
     under section 1238A(a).
       ``(7) Enhanced payment.--The term `enhanced payment' means 
     the amount paid to a producer under a conservation security 
     contract that is equal to the amount described in section 
     1238C(b)(1)(C)(iii).
       ``(8) Nondegradation standard.--The term `nondegradation 
     standard' means the level of measures required to adequately 
     protect, and prevent degradation of, 1 or more natural 
     resources, as determined by the Secretary in accordance with 
     the quality criteria described in handbooks of the Natural 
     Resources Conservation Service.
       ``(9) Producer.--
       ``(A) In general.--The term `producer' means an owner, 
     operator, landlord, tenant, or sharecropper that--
       ``(i) shares in the risk of producing any crop or 
     livestock; and
       ``(ii) is entitled to share in the crop or livestock 
     available for marketing from a farm (or would have shared had 
     the crop or livestock been produced).
       ``(B) Hybrid seed growers.--In determining whether a grower 
     of hybrid seed is a producer, the Secretary shall not take 
     into consideration the existence of a hybrid seed contract.
       ``(10) Resource-conserving crop rotation.--The term 
     `resource-conserving crop rotation' means a crop rotation 
     that--
       ``(A) includes at least 1 resource-conserving crop (as 
     defined by the Secretary);
       ``(B) reduces erosion;
       ``(C) improves soil fertility and tilth;
       ``(D) interrupts pest cycles; and
       ``(E) in applicable areas, reduces depletion of soil 
     moisture (or otherwise reduces the need for irrigation).
       ``(11) Resource management system.--The term `resource 
     management system' means a system of conservation practices 
     and management relating to land or water use that is designed 
     to prevent resource degradation and permit sustained use of 
     land, water, and other natural resources, as defined in 
     accordance with the technical guide of the Natural Resources 
     Conservation Service.
       ``(12) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture, acting through the Chief of the Natural 
     Resources Conservation Service.
       ``(13) Tier i conservation security contract.--The term 
     `Tier I conservation security contract' means a contract 
     described in section 1238A(d)(5)(A).
       ``(14) Tier ii conservation security contract.--The term 
     `Tier II conservation security contract' means a contract 
     described in section 1238A(d)(5)(B).
       ``(15) Tier iii conservation security contract.--The term 
     `Tier III conservation security contract' means a contract 
     described in section 1238A(d)(5)(C).

     ``SEC. 1238A. CONSERVATION SECURITY PROGRAM.

       ``(a) In General.--The Secretary shall establish and, for 
     each of fiscal years 2003 through 2007, carry out a 
     conservation security program to assist producers of 
     agricultural operations in promoting, as is applicable with 
     respect to land to be enrolled in the program, conservation 
     and improvement of the quality of soil, water, air, energy, 
     plant and animal life, and any other conservation purposes, 
     as determined by the Secretary.
       ``(b) Eligibility.--
       ``(1) Eligible producers.--To be eligible to participate in 
     the conservation security program (other than to receive 
     technical assistance under section 1238C(g) for the 
     development of conservation security contracts), a producer 
     shall--
       ``(A) develop and submit to the Secretary, and obtain the 
     approval of the Secretary of, a conservation security plan 
     that meets the requirements of subsection (c)(1); and
       ``(B) enter into a conservation security contract with the 
     Secretary to carry out the conservation security plan.
       ``(2) Eligible land.--Except as provided in paragraph (3), 
     private agricultural land (including cropland, grassland, 
     prairie land, improved pasture land, and rangeland), land 
     under the jurisdiction of an Indian tribe (as defined by the 
     Secretary), and forested land that is an incidental part of 
     an agricultural operation shall be eligible for enrollment in 
     the conservation security program.
       ``(3) Exclusions.--
       ``(A) Conservation reserve program.--Land enrolled in the 
     conservation reserve program under subchapter B of chapter 1 
     shall not be eligible for enrollment in the conservation 
     security program.
       ``(B) Wetlands reserve program.--Land enrolled in the 
     wetlands reserve program established under subchapter C of 
     chapter 1 shall not be eligible for enrollment in the 
     conservation security program.
       ``(C) Grassland reserve program.--Land enrolled in the 
     grassland reserve program established under subchapter C of 
     chapter 2 shall not be eligible for enrollment in the 
     conservation security program.
       ``(D) Conversion to cropland.--Land that is used for crop 
     production after the date of enactment of this subchapter 
     that had not been planted, considered to be planted, or 
     devoted to crop production for at least 4 of the 6 years 
     preceding that date (except for land enrolled in the 
     conservation reserve program under subchapter B of chapter 1) 
     or that has been maintained using long-term crop rotation 
     practices, as determined by the Secretary, shall not be the 
     basis for any payment under the conservation security 
     program.
       ``(4) Economic uses.--The Secretary shall permit a producer 
     to implement, with respect to all eligible land covered by a 
     conservation security plan, economic uses that--
       ``(A) maintain the agricultural nature of the land; and
       ``(B) are consistent with the natural resource and 
     conservation objectives of the conservation security program.
       ``(c) Conservation Security Plans.--
       ``(1) In general.--A conservation security plan shall--
       ``(A) identify the designated land and resources to be 
     conserved under the conservation security plan;
       ``(B) describe the tier of conservation security contract, 
     and the particular conservation practices to be implemented, 
     maintained, or improved, in accordance with subsection (d) on 
     the land covered by the conservation security contract for 
     the specified term; and
       ``(C) contain a schedule for the implementation, 
     maintenance, or improvement of the conservation practices 
     described in the conservation security plan during the term 
     of the conservation security contract.
       ``(2) Resource planning.--The Secretary may assist 
     producers that enter into conservation security contracts in 
     developing a comprehensive, long-term strategy for improving 
     and maintaining all natural resources of the agricultural 
     operation of the producer.
       ``(d) Conservation Contracts and Practices.--
       ``(1) In general.--
       ``(A) Establishment of tiers.--The Secretary shall 
     establish, and offer to eligible producers, 3 tiers of 
     conservation contracts under which a payment under this 
     subchapter may be received.
       ``(B) Eligible conservation practices.--
       ``(i) In general.--The Secretary shall make eligible for 
     payment under a conservation security contract land 
     management, vegetative, and structural practices.
       ``(ii) Determination.--In determining the eligibility of a 
     practice described in clause (i), the Secretary shall 
     require, to the maximum extent practicable, that the lowest 
     cost alternatives be used to fulfill the purposes of the 
     conservation security plan, as determined by the Secretary.
       ``(2) On-farm research and demonstration or pilot 
     testing.--With respect to land enrolled in the conservation 
     security program, the Secretary may approve a conservation 
     security plan that includes--
       ``(A) on-farm conservation research and demonstration 
     activities; and
       ``(B) pilot testing of new technologies or innovative 
     conservation practices.
       ``(3) Use of handbook and guides; state and local 
     conservation concerns.--
       ``(A) Use of handbook and guides.--In determining eligible 
     conservation practices and the criteria for implementing or 
     maintaining the conservation practices under the conservation 
     security program, the Secretary shall use the National 
     Handbook of Conservation Practices of the Natural Resources 
     Conservation Service.
       ``(B) State and local conservation priorities.--The 
     conservation priorities of a State or locality in which an 
     agricultural operation is situated shall be determined by the 
     State Conservationist, in consultation with--
       ``(i) the State technical committee established under 
     subtitle G; and

[[Page H1821]]

       ``(ii) local agricultural producers and conservation 
     working groups.
       ``(4) Conservation practices.--Conservation practices that 
     may be implemented by a producer under a conservation 
     security contract (as appropriate for the agricultural 
     operation of a producer) include--
       ``(A) nutrient management;
       ``(B) integrated pest management;
       ``(C) water conservation (including through irrigation) and 
     water quality management;
       ``(D) grazing, pasture, and rangeland management;
       ``(E) soil conservation, quality, and residue management;
       ``(F) invasive species management;
       ``(G) fish and wildlife habitat conservation, restoration, 
     and management;
       ``(H) air quality management;
       ``(I) energy conservation measures;
       ``(J) biological resource conservation and regeneration;
       ``(K) contour farming;
       ``(L) strip cropping;
       ``(M) cover cropping;
       ``(N) controlled rotational grazing;
       ``(O) resource-conserving crop rotation;
       ``(P) conversion of portions of cropland from a soil-
     depleting use to a soil-conserving use, including production 
     of cover crops;
       ``(Q) partial field conservation practices;
       ``(R) native grassland and prairie protection and 
     restoration; and
       ``(S) any other conservation practices that the Secretary 
     determines to be appropriate and comparable to other 
     conservation practices described in this paragraph.
       ``(5) Tiers.--Subject to paragraph (6), to carry out this 
     subsection, the Secretary shall establish the following 3 
     tiers of conservation contracts:
       ``(A) Tier i conservation security contracts.--A 
     conservation security plan for land enrolled under a Tier I 
     conservation security contract shall--
       ``(i) be for a period of 5 years; and
       ``(ii) include conservation practices appropriate for the 
     agricultural operation, that, at a minimum (as determined by 
     the Secretary)--

       ``(I) address at least 1 significant resource of concern 
     for the enrolled portion of the agricultural operation at a 
     level that meets the appropriate nondegradation standard; 
     and

       ``(II) cover active management of conservation practices 
     that are implemented or maintained under the conservation 
     security contract.

       ``(B) Tier ii conservation security contracts.--A 
     conservation security plan for land enrolled under a Tier II 
     conservation security contract shall--
       ``(i) be for a period of not less than 5 nor more than 10 
     years, as determined by the producer;
       ``(ii) include conservation practices appropriate for the 
     agricultural operation, that, at a minimum--

       ``(I) address at least 1 significant resource of concern 
     for the entire agricultural operation, as determined by the 
     Secretary, at a level that meets the appropriate 
     nondegradation standard; and
       ``(II) cover active management of conservation practices 
     that are implemented or maintained under the conservation 
     security contract.

       ``(C) Tier iii conservation security contracts.--A 
     conservation security plan for land enrolled under a Tier III 
     conservation security contract shall--
       ``(i) be for a period of not less than 5 nor more than 10 
     years, as determined by the producer; and
       ``(ii) include conservation practices appropriate for the 
     agricultural operation that, at a minimum--

       ``(I) apply a resource management system that meets the 
     appropriate nondegradation standard for all resources of 
     concern of the entire agricultural operation, as determined 
     by the Secretary; and
       ``(II) cover active management of conservation practices 
     that are implemented or maintained under the conservation 
     security contract.

       ``(6) Minimum requirements.--The minimum requirements for 
     each tier of conservation contracts implemented under 
     paragraph (5) shall be determined and approved by the 
     Secretary.
       ``(e) Conservation Security Contracts.--
       ``(1) In general.--On approval of a conservation security 
     plan of a producer, the Secretary shall enter into a 
     conservation security contract with the producer to enroll 
     the land covered by the conservation security plan in the 
     conservation security program.
       ``(2) Modification.--
       ``(A) Optional modifications.--A producer may apply to the 
     Secretary for a modification of the conservation security 
     contract of the producer that is consistent with the purposes 
     of the conservation security program.
       ``(B) Other modifications.--
       ``(i) In general.--The Secretary may, in writing, require a 
     producer to modify a conservation security contract before 
     the expiration of the conservation security contract if the 
     Secretary determines that a change made to the type, size, 
     management, or other aspect of the agricultural operation of 
     the producer would, without the modification of the contract, 
     significantly interfere with achieving the purposes of the 
     conservation security program.
       ``(ii) Participation in other programs.--If appropriate 
     payment reductions and other adjustments (as determined by 
     the Secretary) are made to the conservation security contract 
     of a producer, the producer may--

       ``(I) simultaneously participate in--

       ``(aa) the conservation security program;
       ``(bb) the conservation reserve program under subchapter B 
     of chapter 1; and
       ``(cc) the wetlands reserve program under subchapter C of 
     chapter 1; and

       ``(II) may remove land enrolled in the conservation 
     security program for enrollment in a program described in 
     item (bb) or (cc) of subclause (I).

       ``(3) Termination.--
       ``(A) Optional termination.--A producer may terminate a 
     conservation security contract and retain payments received 
     under the conservation security contract, if--
       ``(i) the producer is in full compliance with the terms and 
     conditions (including any maintenance requirements) of the 
     conservation security contract as of the date of the 
     termination; and
       ``(ii) the Secretary determines that termination of the 
     contract would not defeat the purposes of the conservation 
     security plan of the producer.
       ``(B) Other termination.--A producer that is required to 
     modify a conservation security contract under paragraph 
     (2)(B)(i) may, in lieu of modifying the contract--
       ``(i) terminate the conservation security contract; and
       ``(ii) retain payments received under the conservation 
     security contract, if the producer has fully complied with 
     the terms and conditions of the conservation security 
     contract before termination of the contract, as determined by 
     the Secretary.
       ``(4) Renewal.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     at the option of a producer, the conservation security 
     contract of the producer may be renewed for an additional 
     period of not less than 5 nor more than 10 years.
       ``(B) Tier i renewals.--In the case of a Tier I 
     conservation security contract of a producer, the producer 
     may renew the contract only if the producer agrees--
       ``(i) to apply additional conservation practices that meet 
     the nondegradation standard on land already enrolled in the 
     conservation security program; or
       ``(ii) to adopt new conservation practices with respect to 
     another portion of the agricultural operation that address 
     resource concerns and meet the nondegradation standard under 
     the terms of the Tier I conservation security contract.
       ``(f) Noncompliance Due to Circumstances Beyond the Control 
     of Producers.--The Secretary shall include in the 
     conservation security contract a provision, and may permit 
     modification of a conservation security contract under 
     subsection (e)(1), to ensure that a producer shall not be 
     considered in violation of a conservation security contract 
     for failure to comply with the conservation security contract 
     due to circumstances beyond the control of the producer, 
     including a disaster or related condition, as determined by 
     the Secretary.

     ``SEC. 1238B. DUTIES OF PRODUCERS.

       ``Under a conservation security contract, a producer shall 
     agree, during the term of the conservation security 
     contract--
       ``(1) to implement the applicable conservation security 
     plan approved by the Secretary;
       ``(2) to maintain, and make available to the Secretary at 
     such times as the Secretary may request, appropriate records 
     showing the effective and timely implementation of the 
     conservation security plan;
       ``(3) not to engage in any activity that would interfere 
     with the purposes of the conservation security program; and
       ``(4) on the violation of a term or condition of the 
     conservation security contract--
       ``(A) if the Secretary determines that the violation 
     warrants termination of the conservation security contract--
       ``(i) to forfeit all rights to receive payments under the 
     conservation security contract; and
       ``(ii) to refund to the Secretary all or a portion of the 
     payments received by the producer under the conservation 
     security contract, including any advance payments and 
     interest on the payments, as determined by the Secretary; or
       ``(B) if the Secretary determines that the violation does 
     not warrant termination of the conservation security 
     contract, to refund to the Secretary, or accept adjustments 
     to, the payments provided to the producer, as the Secretary 
     determines to be appropriate.

     ``SEC. 1238C. DUTIES OF THE SECRETARY.

       ``(a) Timing of Payments.--The Secretary shall make 
     payments under a conservation security contract as soon as 
     practicable after October 1 of each fiscal year.
       ``(b) Annual Payments.--
       ``(1) Criteria for determining amount of payments.--
       ``(A) Base payment.--A base payment under this paragraph 
     shall be (as determined by the Secretary)--
       ``(i) the average national per-acre rental rate for a 
     specific land use during the 2001 crop year; or
       ``(ii) another appropriate rate for the 2001 crop year that 
     ensures regional equity.
       ``(B) Payments.--A payment for a conservation practice 
     under this paragraph shall be determined in accordance with 
     subparagraphs (C) through (E).
       ``(C) Tier i conservation security contracts.--The payment 
     for a Tier I conservation security contract shall consist of 
     the total of the following amounts:
       ``(i) An amount equal to 5 percent of the applicable base 
     payment for land covered by the contract.
       ``(ii) An amount that does not exceed 75 percent (or, in 
     the case of a beginning farmer or rancher, 90 percent) of the 
     average county costs of practices for the 2001 crop year that 
     are included in the conservation security contract, as 
     determined by the Secretary, including the costs of--

       ``(I) the adoption of new management, vegetative, and land-
     based structural practices;
       ``(II) the maintenance of existing land management and 
     vegetative practices; and
       ``(III) the maintenance of existing land-based structural 
     practices that are approved by the Secretary but not already 
     covered by a Federal or State maintenance requirement.

       ``(iii) An enhanced payment that is determined by the 
     Secretary in a manner that ensures equity across regions of 
     the United States, if the producer--

[[Page H1822]]

       ``(I) implements or maintains multiple conservation 
     practices that exceed minimum requirements for the applicable 
     tier of participation (including practices that involve a 
     change in land use, such as resource-conserving crop 
     rotation, managed rotational grazing, or conservation buffer 
     practices);
       ``(II) addresses local conservation priorities in addition 
     to resources of concern for the agricultural operation;
       ``(III) participates in an on-farm conservation research, 
     demonstration, or pilot project;
       ``(IV) participates in a watershed or regional resource 
     conservation plan that involves at least 75 percent of 
     producers in a targeted area; or
       ``(V) carries out assessment and evaluation activities 
     relating to practices included in a conservation security 
     plan.

       ``(D) Tier ii conservation security contracts.--The payment 
     for a Tier II conservation security contract shall consist of 
     the total of the following amounts:
       ``(i) An amount equal to 10 percent of the applicable base 
     payment for land covered by the conservation security 
     contract.
       ``(ii) An amount that does not exceed 75 percent (or, in 
     the case of a beginning farmer or rancher, 90 percent) of the 
     average county cost of adopting or maintaining practices for 
     the 2001 crop year that are included in the conservation 
     security contract, as described in subparagraph (C)(ii).
       ``(iii) An enhanced payment that is determined in 
     accordance with subparagraph (C)(iii).
       ``(E) Tier iii conservation security contracts.--The 
     payment for a Tier III conservation security contract shall 
     consist of the total of the following amounts:
       ``(i) An amount equal to 15 percent of the base payment for 
     land covered by the conservation security contract.
       ``(ii) An amount that does not exceed 75 percent (or, in 
     the case of a beginning farmer or rancher, 90 percent) of the 
     average county cost of adopting or maintaining practices for 
     the 2001 crop year that are included in the conservation 
     security contract, as described in subparagraph (C)(ii).
       ``(iii) An enhanced payment that is determined in 
     accordance with subparagraph (C)(iii).
       ``(2) Limitation on payments.--
       ``(A) In general.--Subject to paragraphs (1) and (3), the 
     Secretary shall make an annual payment, directly or 
     indirectly, to an individual or entity covered by a 
     conservation security contract in an amount not to exceed--
       ``(i) in the case of a Tier I conservation security 
     contract, $20,000;
       ``(ii) in the case of a Tier II conservation security 
     contract, $35,000; or
       ``(iii) in the case of a Tier III conservation security 
     contract, $45,000.
       ``(B) Limitation on base payments.--In applying the payment 
     limitation under each of clauses (i), (ii), and (iii) of 
     subparagraph (A), an individual or entity may not receive, 
     directly or indirectly, payments described in clause (i) of 
     paragraph (1)(C), (1)(D), or (1)(E), as appropriate, in an 
     amount that exceeds--
       ``(i) in the case of Tier I contracts, 25 percent of the 
     applicable payment limitation; or
       ``(ii) in the case of Tier II contracts and Tier III 
     contracts, 30 percent of the applicable payment limitation.
       ``(C) Other usda payments.--A producer shall not receive 
     payments under the conservation security program and any 
     other conservation program administered by the Secretary for 
     the same practices on the same land.
       ``(D) Commensurate share.--To be eligible to receive a 
     payment under this subchapter, an individual or entity shall 
     make contributions (including contributions of land, labor, 
     management, equipment, or capital) to the operation of the 
     farm that are at least commensurate with the share of the 
     proceeds of the operation of the individual or entity.
       ``(3) Equipment or facilities.--A payment to a producer 
     under this subchapter shall not be provided for--
       ``(A) construction or maintenance of animal waste storage 
     or treatment facilities or associated waste transport or 
     transfer devices for animal feeding operations; or
       ``(B) the purchase or maintenance of equipment or a non-
     land based structure that is not integral to a land-based 
     practice, as determined by the Secretary.
       ``(c) Minimum Practice Requirement.--In determining a 
     payment under subsection (b) for a producer that receives a 
     payment under another program administered by the Secretary 
     that is contingent on complying with requirements under 
     subtitle B or C (relating to the use of highly erodible land 
     or wetland), a payment under this subchapter on land subject 
     to those requirements shall be for practices only to the 
     extent that the practices exceed minimum requirements for the 
     producer under those subtitles, as determined by the 
     Secretary.
       ``(d) Regulations.--The Secretary shall promulgate 
     regulations that--
       ``(1) provide for adequate safeguards to protect the 
     interests of tenants and sharecroppers, including provision 
     for sharing payments, on a fair and equitable basis; and
       ``(2) prescribe such other rules as the Secretary 
     determines to be necessary to ensure a fair and reasonable 
     application of the limitations established under subsection 
     (b).
       ``(e) Transfer or Change of Interest in Land Subject to 
     Conservation Security Contract.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     transfer, or change in the interest, of a producer in land 
     subject to a conservation security contract shall result in 
     the termination of the conservation security contract.
       ``(2) Transfer of duties and rights.--Paragraph (1) shall 
     not apply if, not later than 60 days after the date of the 
     transfer or change in the interest in land, the transferee of 
     the land provides written notice to the Secretary that all 
     duties and rights under the conservation security contract 
     have been transferred to, and assumed by, the transferee.
       ``(f) Enrollment Procedure.--In entering into conservation 
     security contracts with producers under this subchapter, the 
     Secretary shall not use competitive bidding or any similar 
     procedure.
       ``(g) Technical Assistance.--For each of fiscal years 2003 
     through 2007, the Secretary shall provide technical 
     assistance to producers for the development and 
     implementation of conservation security contracts, in an 
     amount not to exceed 15 percent of amounts expended for the 
     fiscal year.''.
       (b) Regulations.--Not later than 270 days after the date of 
     enactment of this Act, the Secretary of Agriculture shall 
     promulgate regulations implementing the amendment made by 
     subsection (a).

     SEC. 2002. CONSERVATION COMPLIANCE.

       (a) Highly Erodible Land.--Section 1211 of the Food 
     Security Act of 1985 (16 U.S.C. 3811) is amended--
       (1) by striking the section heading and all that follows 
     through ``Except as provided in'' and inserting the 
     following:

     ``SEC. 1211. PROGRAM INELIGIBILITY.

       ``(a) In General.--Except as provided in''; and
       (2) by adding at the end the following:
       ``(b) Highly Erodible Land.--The Secretary shall have, and 
     shall not delegate to any private person or entity, authority 
     to determine whether a person has complied with this 
     subtitle.''.
       (b) Wetland.--Section 1221 of the Food Security Act of 1985 
     (16 U.S.C. 3821) is amended by adding at the end the 
     following:
       ``(e) Wetland.--The Secretary shall have, and shall not 
     delegate to any private person or entity, authority to 
     determine whether a person has complied with this 
     subtitle.''.

     SEC. 2003. PARTNERSHIPS AND COOPERATION.

       Section 1243 of the Food Security Act of 1985 (16 U.S.C. 
     3843) is amended by adding at the end the following:
       ``(f) Partnerships and Cooperation.--
       ``(1) In general.--In carrying out any program under 
     subtitle D, the Secretary may use resources provided under 
     that subtitle to enter into stewardship agreements with State 
     and local agencies, Indian tribes, and nongovernmental 
     organizations and to designate special projects, as 
     recommended by the State Conservationist, after consultation 
     with the State technical committee, to enhance technical and 
     financial assistance provided to owners, operators, and 
     producers to address natural resource issues related to 
     agricultural production.
       ``(2) Criteria for special projects.--The purposes of 
     special projects carried out under this subsection shall be 
     to encourage--
       ``(A) producers to cooperate in the installation and 
     maintenance of conservation practices that affect multiple 
     agricultural operations;
       ``(B) the sharing of information and technical and 
     financial resources among producers;
       ``(C) cumulative conservation benefits in geographic areas; 
     and
       ``(D) the development and demonstration of innovative 
     conservation methods.
       ``(3) Incentives.--To realize the purposes of the special 
     projects under paragraph (1), the Secretary may provide 
     special incentives to owners, operators, and producers 
     participating in the special projects to encourage 
     partnerships and enrollments of optimal conservation value.
       ``(4) Flexibility.--
       ``(A) In general.--The Secretary may enter into stewardship 
     agreements with States (including State agencies and units of 
     local government), Indian tribes, and nongovernmental 
     organizations that have a history of working with 
     agricultural producers to allow greater flexibility to adjust 
     the application of eligibility criteria, approved practices, 
     innovative conservation practices, and other elements of the 
     programs under this title to better reflect unique local 
     circumstances and purposes in a manner that is consistent 
     with--
       ``(i) conservation enhancement and long-term productivity 
     of the natural resource base; and
       ``(ii) the purposes and requirements of this title.
       ``(B) Plan.--Each party to a stewardship agreement under 
     subparagraph (A) shall submit to the Secretary, for approval 
     by the Secretary, a special project area plan for each 
     program to be carried out by the party that includes--
       ``(i) a description of the requested resources and 
     adjustments to program implementation (including a 
     description of how those adjustments will accelerate the 
     achievement of conservation benefits);
       ``(ii) an analysis of the contribution those adjustments 
     will make to the effectiveness of programs in achieving the 
     purposes of the special project;
       ``(iii) a timetable for reevaluating the need for or 
     performance of the proposed adjustments;
       ``(iv) a description of non-Federal programs and resources 
     that will contribute to achieving the purposes of the special 
     project; and
       ``(v) a plan for the evaluation of progress toward the 
     purposes of the special project.
       ``(5) Funding.--
       ``(A) In general.--In addition to resources from programs 
     under subtitle D, subject to subparagraph (B), the Secretary 
     shall use not more than 5 percent of the funds made available 
     for each fiscal year under section 1241(a) to carry out 
     activities that are authorized under conservation programs 
     under subtitle D.
       ``(B) Unused funding.--Any funds made available for a 
     fiscal year under subparagraph (A) that are not obligated by 
     April 1 of the fiscal year may be used to carry out other 
     activities under conservation programs under subtitle D 
     during the fiscal year in which the funding becomes 
     available.''.

     SEC. 2004. ADMINISTRATIVE REQUIREMENTS FOR CONSERVATION 
                   PROGRAMS.

       (a) In General.--Subtitle E of title XII of the Food 
     Security Act of 1985 (16 U.S.C. 3841 et seq.) is amended by 
     adding at the end the following:

[[Page H1823]]

     ``SEC. 1244. ADMINISTRATIVE REQUIREMENTS FOR CONSERVATION 
                   PROGRAMS.

       ``(a) Beginning Farmers and Ranchers and Indian Tribes.--In 
     carrying out any conservation program administered by the 
     Secretary, the Secretary may provide to beginning farmers and 
     ranchers and Indian tribes (as those terms are defined in 
     section 1238) and limited resource agricultural producers 
     incentives to participate in the conservation program to--
       ``(1) foster new farming and ranching opportunities; and
       ``(2) enhance environmental stewardship over the long term.
       ``(b) Privacy of Personal Information Relating to Natural 
     Resources Conservation Programs.--
       ``(1) Information received for technical and financial 
     assistance.--
       ``(A) In general.--In accordance with section 552(b)(3) of 
     title 5, United States Code, except as provided in 
     subparagraph (C) and paragraph (2), information described in 
     subparagraph (B)--
       ``(i) shall not be considered to be public information; and
       ``(ii) shall not be released to any person or Federal, 
     State, local agency or Indian tribe (as defined by the 
     Secretary) outside the Department of Agriculture.
       ``(B) Information.--The information referred to in 
     subparagraph (A) is information--
       ``(i) provided to the Secretary or a contractor of the 
     Secretary (including information provided under subtitle D) 
     for the purpose of providing technical or financial 
     assistance to an owner, operator, or producer with respect to 
     any natural resources conservation program administered by 
     the Natural Resources Conservation Service or the Farm 
     Service Agency; and
       ``(ii) that is proprietary (within the meaning of section 
     552(b)(4) of title 5, United States Code) to the agricultural 
     operation or land that is a part of an agricultural operation 
     of the owner, operator, or producer.
       ``(C) Exception.--Nothing in this section affects the 
     availability of payment information (including payment 
     amounts and the names and addresses of recipients of 
     payments) under section 552 of title 5, United States Code.
       ``(2) Exceptions.--
       ``(A) Release and disclosure for enforcement.--The 
     Secretary may release or disclose to the Attorney General 
     information covered by paragraph (1) to the extent necessary 
     to enforce the natural resources conservation programs 
     referred to in paragraph (1)(B)(i).
       ``(B) Disclosure to cooperating persons and agencies.--
       ``(i) In general.--The Secretary may release or disclose 
     information covered by paragraph (1) to a person or Federal, 
     State, local, or tribal agency working in cooperation with 
     the Secretary in providing technical and financial assistance 
     described in paragraph (1)(B)(i) or collecting information 
     from data gathering sites.
       ``(ii) Use of information.--The person or Federal, State, 
     local, or tribal agency that receives information described 
     in clause (i) may release the information only for the 
     purpose of assisting the Secretary--

       ``(I) in providing the requested technical or financial 
     assistance; or
       ``(II) in collecting information from data gathering sites.

       ``(C) Statistical and aggregate information.--Information 
     covered by paragraph (1) may be disclosed to the public if 
     the information has been transformed into a statistical or 
     aggregate form without naming any--
       ``(i) individual owner, operator, or producer; or
       ``(ii) specific data gathering site.
       ``(D) Consent of owner, operator, or producer.--
       ``(i) In general.--An owner, operator, or producer may 
     consent to the disclosure of information described in 
     paragraph (1).
       ``(ii) Condition of other programs.--The participation of 
     the owner, operator, or producer in, and the receipt of any 
     benefit by the owner, operator, or producer under, this title 
     or any other program administered by the Secretary may not be 
     conditioned on the owner, operator, or producer providing 
     consent under this paragraph.
       ``(3) Violations; penalties.--Section 1770(c) shall apply 
     with respect to the release of information collected in any 
     manner or for any purpose prohibited by this subsection.
       ``(4) Data collection, disclosure, and review.--Nothing in 
     this subsection--
       ``(A) affects any procedure for data collection or 
     disclosure through the National Resources Inventory; or
       ``(B) limits the authority of Congress or the General 
     Accounting Office to review information collected or 
     disclosed under this subsection.''.
       (b) National Resources Inventory.--Section 1770 of the Food 
     Security Act of 1985 (7 U.S.C. 2276) is amended--
       (1) in subsection (a)--
       (A) in paragraph (1), by striking ``or'' at the end;
       (B) in paragraph (2), by striking the period and inserting 
     ``; or''; and
       (C) by adding at the end the following:
       ``(3) in the case of information collected under the 
     authority described in subsection (d)(12), disclose the 
     information to any person or any Federal, State, local, or 
     tribal agency outside the Department of Agriculture, unless 
     the information has been converted into a statistical or 
     aggregate form that does not allow the identification of the 
     person that supplied particular information.''; and
       (2) in subsection (d)--
       (A) in paragraph (9), by striking ``or'' at the end;
       (B) in paragraph (11), by striking the period and inserting 
     ``; or''; and
       (C) by adding at the end the following:
       ``(12) section 302 of the Rural Development Act of 1972 (7 
     U.S.C. 1010a) regarding the authority to collect data for the 
     National Resources Inventory.''.

     SEC. 2005. REFORM AND ASSESSMENT OF CONSERVATION PROGRAMS.

       (a) In General.--The Secretary of Agriculture shall develop 
     a plan to coordinate land retirement and agricultural working 
     land conservation programs that are administered by the 
     Secretary to achieve the goals of--
       (1) eliminating redundancy;
       (2) streamlining program delivery; and
       (3) improving services provided to agricultural producers 
     (including the reevaluation of the provision of technical 
     assistance).
       (b) Report.--Not later than December 31, 2005, the 
     Secretary of Agriculture shall submit to the Committee on 
     Agriculture of the House of Representatives and the Committee 
     on Agriculture, Nutrition, and Forestry of the Senate, a 
     report that describes--
       (1) the plan developed under subsection (a); and
       (2) the means by which the Secretary intends to achieve the 
     goals described in subsection (a).

     SEC. 2006. CONFORMING AMENDMENTS.

       (a) Chapter 1 of subtitle D of title XII of the Food 
     Security Act of 1985 (16 U.S.C. 3830 et seq.) is amended by 
     striking the chapter heading and inserting the following:

     ``CHAPTER 1--COMPREHENSIVE CONSERVATION ENHANCEMENT PROGRAM''.

       (b) Section 1230 of the Food Security Act of 1985 (16 
     U.S.C. 3830) is amended--
       (1) in the section heading, by striking ``ENVIRONMENTAL 
     CONSERVATION ACREAGE RESERVE PROGRAM'' and inserting 
     ``COMPREHENSIVE CONSERVATION ENHANCEMENT PROGRAM'';
       (2) in subsection (a)(1), by striking ``an environmental 
     conservation acreage reserve program'' and inserting ``a 
     comprehensive conservation enhancement program'';
       (3) by striking subsection (c); and
       (4) by striking ``ECARP'' each place it appears and 
     inserting ``CCEP''.
       (c) Section 1230A of the Food Security Act of 1985 (16 
     U.S.C. 3830a) is repealed.
       (d) Section 1243 of the Food Security Act of 1985 (16 
     U.S.C. 3843) is amended by striking the section heading and 
     inserting the following:

     ``SEC. 1243. ADMINISTRATION OF CCEP.''.

                    Subtitle B--Conservation Reserve

     SEC. 2101. CONSERVATION RESERVE PROGRAM.

       (a) In General.--Subchapter B of chapter 1 of subtitle D of 
     title XII of the Food Security Act of 1985 (16 U.S.C. 3831 et 
     seq.) is amended to read as follows:

                  ``Subchapter B--Conservation Reserve

     ``SEC. 1231. CONSERVATION RESERVE.

       ``(a) In General.--Through the 2007 calendar year, the 
     Secretary shall formulate and carry out a conservation 
     reserve program under which land is enrolled through the use 
     of contracts to assist owners and operators of land specified 
     in subsection (b) to conserve and improve the soil, water, 
     and wildlife resources of such land.
       ``(b) Eligible Land.--The Secretary may include in the 
     program established under this subchapter--
       ``(1) highly erodible cropland that--
       ``(A)(i) if permitted to remain untreated could 
     substantially reduce the agricultural production capability 
     for future generations; or
       ``(ii) cannot be farmed in accordance with a plan that 
     complies with the requirements of subtitle B; and
       ``(B) the Secretary determines had a cropping history or 
     was considered to be planted for 4 of the 6 years preceding 
     the date of enactment of the Farm Security and Rural 
     Investment Act of 2002 (except for land enrolled in the 
     conservation reserve program as of that date).
       ``(2) marginal pasture land converted to wetland or 
     established as wildlife habitat prior to November 28, 1990;
       ``(3) marginal pasture land to be devoted to appropriate 
     vegetation, including trees, in or near riparian areas, or 
     devoted to similar water quality purposes (including marginal 
     pastureland converted to wetland or established as wildlife 
     habitat);
       ``(4) cropland that is otherwise ineligible if the 
     Secretary determines that--
       ``(A) if permitted to remain in agricultural production, 
     the land would--
       ``(i) contribute to the degradation of soil, water, or air 
     quality; or
       ``(ii) pose an on-site or off-site environmental threat to 
     soil, water, or air quality;
       ``(B) the land is a--
       ``(i) newly-created, permanent grass sod waterway; or
       ``(ii) a contour grass sod strip established and maintained 
     as part of an approved conservation plan;
       ``(C) the land will be devoted to newly established living 
     snow fences, permanent wildlife habitat, windbreaks, 
     shelterbelts, or filterstrips devoted to trees or shrubs; or
       ``(D) the land poses an off-farm environmental threat, or a 
     threat of continued degradation of productivity due to soil 
     salinity, if permitted to remain in production; and
       ``(E) enrollment of the land would facilitate a net savings 
     in groundwater or surface water resources of the agricultural 
     operation of the producer;
       ``(5) the portion of land in a field not enrolled in the 
     conservation reserve in a case in which more than 50 percent 
     of the land in the field is enrolled as a buffer, if--
       ``(A) the land is enrolled as part of the buffer; and
       ``(B) the remainder of the field is--
       ``(i) infeasible to farm; and
       ``(ii) enrolled at regular rental rates.

[[Page H1824]]

       ``(c) Planting Status of Certain Land.--For purposes of 
     determining the eligibility of land to be placed in the 
     conservation reserve established under this subchapter, land 
     shall be considered to be planted to an agricultural 
     commodity during a crop year if--
       ``(1) during the crop year, the land was devoted to a 
     conserving use; or
       ``(2)(A) during the crop year or during any of the 2 years 
     preceding the crop year, the land was enrolled in the water 
     bank program; and
       ``(B) the contract of the owner or operator of the cropland 
     expired or will expire in calendar year 2000, 2001, or 2002.
       ``(d) Maximum Enrollment.--The Secretary may maintain up to 
     39,200,000 acres in the conservation reserve at any 1 time 
     during the 2002 through 2007 calendar years (including 
     contracts extended by the Secretary pursuant to section 
     1437(c) of the Food, Agriculture, Conservation, and Trade Act 
     of 1990 ( 16 U.S.C. 3831 note; Public Law 101-624)).
       ``(e) Duration of Contract.--
       ``(1) In general.--For the purpose of carrying out this 
     subchapter, the Secretary shall enter into contracts of not 
     less than 10, nor more than 15, years.
       ``(2) Certain land.--
       ``(A) In general.--In the case of land devoted to hardwood 
     trees, shelterbelts, windbreaks, or wildlife corridors under 
     a contract entered into under this subchapter after October 
     1, 1990, and land devoted to such uses under contracts 
     modified under section 1235A, the owner or operator of the 
     land may, within the limitations prescribed under this 
     section, specify the duration of the contract.
       ``(B) Hardwood trees.--In the case of land that is devoted 
     to hardwood trees under a contract entered into under this 
     subchapter prior to October 1, 1990, the Secretary may extend 
     the contract for a term of not to exceed 5 years, as agreed 
     to by the owner or operator of such land and the Secretary.
       ``(3) 1-year extension.--In the case of a contract 
     described in paragraph (1) the term of which expires during 
     calendar year 2002, an owner or operator of land enrolled 
     under the contract may extend the contract for 1 additional 
     year.
       ``(f) Conservation Priority Areas.--
       ``(1) Designation.--On application by the appropriate State 
     agency, the Secretary shall designate watershed areas of the 
     Chesapeake Bay Region (Pennsylvania, Maryland, and Virginia), 
     the Great Lakes Region, the Long Island Sound Region, and 
     other areas of special environmental sensitivity as 
     conservation priority areas.
       ``(2) Eligible watersheds.--Watersheds eligible for 
     designation under this subsection shall include areas with 
     actual and significant adverse water quality or habitat 
     impacts related to agricultural production activities.
       ``(3) Expiration.--Conservation priority area designation 
     under this subsection shall expire after 5 years, subject to 
     redesignation, except that the Secretary may withdraw a 
     watershed's designation--
       ``(A) on application by the appropriate State agency; or
       ``(B) in the case of an area covered by this subsection, if 
     the Secretary finds that the area no longer contains actual 
     and significant adverse water quality or habitat impacts 
     related to agricultural production activities.
       ``(4) Duty of secretary.--In carrying out this subsection, 
     the Secretary shall attempt to maximize water quality and 
     habitat benefits in the watersheds described in paragraph (1) 
     by promoting a significant level of enrollment of land within 
     the watersheds in the program under this subchapter by 
     whatever means the Secretary determines are appropriate and 
     consistent with the purposes of this subchapter.
       ``(g) Multi-Year Grasses and Legumes.--For purposes of this 
     subchapter, alfalfa and other multi-year grasses and legumes 
     in a rotation practice, approved by the Secretary, shall be 
     considered agricultural commodities.
       ``(h) Pilot Program for Enrollment of Wetland and Buffer 
     Acreage in Conservation Reserve.--
       ``(1) Program.--
       ``(A) In general.--During the 2002 through 2007 calendar 
     years, the Secretary shall carry out a program in each State 
     under which the Secretary shall include eligible acreage 
     described in paragraph (2) in the program established under 
     this subchapter.
       ``(B) Participation among states.-The Secretary shall 
     ensure, to the maximum extent practicable, that owners and 
     operators in each State have an equitable opportunity to 
     participate in the pilot program established under this 
     subsection.
       ``(2) Eligible acreage.--
       ``(A) In general.--Subject to subparagraphs (B) through 
     (D), an owner or operator may enroll in the conservation 
     reserve under this subsection--
       ``(i) a wetland (including a converted wetland described in 
     section 1222(b)(1)(A)) that was cropped during at least 3 of 
     the immediately preceding 10 crop years; and
       ``(ii) buffer acreage that--

       ``(I) is contiguous to the wetland described in clause (i);
       ``(II) is used to protect the wetland; and
       ``(III) is of such width as the Secretary determines is 
     necessary to protect the wetland, taking into consideration 
     and accommodating the farming practices (including the 
     straightening of boundaries to accommodate machinery) used 
     with respect to the cropland that surrounds the wetland.

       ``(B) Exclusions.--An owner or operator may not enroll in 
     the conservation reserve under this subsection--
       ``(i) any wetland, or land on a floodplain, that is, or is 
     adjacent to, a perennial riverine system wetland identified 
     on the final national wetland inventory map of the Secretary 
     of the Interior; or
       ``(ii) in the case of an area that is not covered by the 
     final national inventory map, any wetland, or land on a 
     floodplain, that is adjacent to a perennial stream identified 
     on a 1-24,000 scale map of the United States Geological 
     Survey.
       ``(C) Program limitations.--
       ``(i) In general.--The Secretary may enroll in the 
     conservation reserve under this subsection not more than--

       ``(I) 100,000 acres in any 1 State referred to in paragraph 
     (1); and
       ``(II) not more than a total of 1,000,000 acres.

       ``(ii) Relationship to program maximum.--Subject to clause 
     (iii), for the purposes of subsection (d), any acreage 
     enrolled in the conservation reserve under this subsection 
     shall be considered acres maintained in the conservation 
     reserve.
       ``(iii) Relationship to other enrolled acreage.--Acreage 
     enrolled under this subsection shall not affect for any 
     fiscal year the quantity of--

       ``(I) acreage enrolled to establish conservation buffers as 
     part of the program announced on March 24, 1998 (63 Fed. Reg. 
     14109); or
       ``(II) acreage enrolled into the conservation reserve 
     enhancement program announced on May 27, 1998 (63 Fed. Reg. 
     28965).

       ``(iv) Review; potential increase in enrollment acreage.--
     Not later than 3 years after the date of enactment of this 
     clause, the Secretary shall--

       ``(I) conduct a review of the program under this subsection 
     with respect to each State that has enrolled land in the 
     program; and
       ``(II) notwithstanding clause (i)(I), increase the number 
     of acres that may be enrolled by a State under clause (i)(I) 
     to not more than 150,000 acres, as determined by the 
     Secretary.

       ``(D) Owner or operator limitations.--
       ``(i) Wetland.--

       ``(I) In general.--The maximum size of any wetland 
     described in subparagraph (A)(i) of an owner or operator 
     enrolled in the conservation reserve under this subsection 
     shall be 10 contiguous acres, of which not more than 5 acres 
     shall be eligible for payment.
       ``(II) Coverage.--All acres described in subclause (I) 
     (including acres that are ineligible for payment) shall be 
     covered by the conservation contract.

       ``(ii) Buffer acreage.--The maximum size of any buffer 
     acreage described in subparagraph (A)(ii) of an owner or 
     operator enrolled in the conservation reserve under this 
     subsection shall be the greater of--

       ``(I) 3 times the size of any wetland described in 
     subparagraph (A)(i) to which the buffer acreage is 
     contiguous; or
       ``(II) 150 feet on either side of the wetland.

       ``(iii) Tracts.--The maximum size of any eligible acreage 
     described in subparagraph (A) in a tract (as determined by 
     the Secretary) of an owner or operator enrolled in the 
     conservation reserve under this subsection shall be 40 acres.
       ``(3) Duties of owners and operators.--Under a contract 
     entered into under this subsection, during the term of the 
     contract, an owner or operator of a farm or ranch shall 
     agree--
       ``(A) to restore the hydrology of the wetland within the 
     eligible acreage to the maximum extent practicable, as 
     determined by the Secretary;
       ``(B) to establish vegetative cover (which may include 
     emerging vegetation in water) on the eligible acreage, as 
     determined by the Secretary; and
       ``(C) to carry out other duties described in section 1232.
       ``(4) Duties of the secretary.--
       ``(A) In general.--Except as provided in subparagraphs (B) 
     and (C), in return for a contract entered into by an owner or 
     operator under this subsection, the Secretary shall make 
     payments and provide assistance to the owner or operator in 
     accordance with sections 1233 and 1234.
       ``(B) Continuous signup.--The Secretary shall use 
     continuous signup under section 1234(c)(2)(B) to determine 
     the acceptability of contract offers and the amount of rental 
     payments under this subsection.
       ``(C) Incentives.--The amounts payable to owners and 
     operators in the form of rental payments under contracts 
     entered into under this subsection shall reflect incentives 
     that are provided to owners and operators to enroll 
     filterstrips in the conservation reserve under section 1234.
       ``(i) Eligibility for Consideration.--On the expiration of 
     a contract entered into under this subchapter, the land 
     subject to the contract shall be eligible to be considered 
     for reenrollment in the conservation reserve.
       ``(j) Balance of Natural Resource Purposes.--In determining 
     the acceptability of contract offers under this subchapter, 
     the Secretary shall ensure, to the maximum extent 
     practicable, an equitable balance among the conservation 
     purposes of soil erosion, water quality, and wildlife 
     habitat.

     ``SEC. 1232. DUTIES OF OWNERS AND OPERATORS.

       ``(a) In General.--Under the terms of a contract entered 
     into under this subchapter, during the term of the contract, 
     an owner or operator of a farm or ranch shall agree--
       ``(1) to implement a plan approved by the local 
     conservation district (or in an area not located within a 
     conservation district, a plan approved by the Secretary) for 
     converting eligible land normally devoted to the production 
     of an agricultural commodity on the farm or ranch to a less 
     intensive use (as defined by the Secretary), such as pasture, 
     permanent grass, legumes, forbs, shrubs, or trees, 
     substantially in accordance with a schedule outlined in the 
     plan;
       ``(2) to place highly erodible cropland subject to the 
     contract in the conservation reserve established under this 
     subchapter;

[[Page H1825]]

       ``(3) not to use the land for agricultural purposes, except 
     as permitted by the Secretary;
       ``(4) to establish approved vegetative cover (which may 
     include emerging vegetation in water), water cover for the 
     enhancement of wildlife, or, where practicable, maintain 
     existing cover on the land, except that--
       ``(A) the water cover shall not include ponds for the 
     purpose of watering livestock, irrigating crops, or raising 
     fish for commercial purposes; and
       ``(B) the Secretary shall not terminate the contract for 
     failure to establish approved vegetative or water cover on 
     the land if--
       ``(i) the failure to plant the cover was due to excessive 
     rainfall or flooding;
       ``(ii) the land subject to the contract that could 
     practicably be planted to the cover is planted to the cover; 
     and
       ``(iii) the land on which the owner or operator was unable 
     to plant the cover is planted to the cover after the wet 
     conditions that prevented the planting subsides;
       ``(5) on a violation of a term or condition of the contract 
     at any time the owner or operator has control of the land--
       ``(A) to forfeit all rights to receive rental payments and 
     cost sharing payments under the contract and to refund to the 
     Secretary any rental payments and cost sharing payments 
     received by the owner or operator under the contract, 
     together with interest on the payments as determined by the 
     Secretary, if the Secretary, after considering the 
     recommendations of the soil conservation district and the 
     Natural Resources Conservation Service, determines that the 
     violation is of such nature as to warrant termination of the 
     contract; or
       ``(B) to refund to the Secretary, or accept adjustments to, 
     the rental payments and cost sharing payments provided to the 
     owner or operator, as the Secretary considers appropriate, if 
     the Secretary determines that the violation does not warrant 
     termination of the contract;
       ``(6) on the transfer of the right and interest of the 
     owner or operator in land subject to the contract--
       ``(A) to forfeit all rights to rental payments and cost 
     sharing payments under the contract; and
       ``(B) to refund to the United States all rental payments 
     and cost sharing payments received by the owner or operator, 
     or accept such payment adjustments or make such refunds as 
     the Secretary considers appropriate and consistent with the 
     objectives of this subchapter;

     unless the transferee of the land agrees with the Secretary 
     to assume all obligations of the contract, except that no 
     refund of rental payments and cost sharing payments shall be 
     required if the land is purchased by or for the United States 
     Fish and Wildlife Service, or the transferee and the 
     Secretary agree to modifications to the contract, in a case 
     in which the modifications are consistent with the objectives 
     of the program, as determined by the Secretary;
       ``(7) not to conduct any harvesting or grazing, nor 
     otherwise make commercial use of the forage, on land that is 
     subject to the contract, nor adopt any similar practice 
     specified in the contract by the Secretary as a practice that 
     would tend to defeat the purposes of the contract, except 
     that the Secretary may permit, consistent with the 
     conservation of soil, water quality, and wildlife habitat 
     (including habitat during nesting seasons for birds in the 
     area)--
       ``(A) managed harvesting and grazing (including the managed 
     harvesting of biomass), except that in permitting managed 
     harvesting and grazing, the Secretary--
       ``(i) shall, in coordination with the State technical 
     committee--

       ``(I) develop appropriate vegetation management 
     requirements; and
       ``(II) identify periods during which harvesting and grazing 
     under this paragraph may be conducted;

       ``(ii) may permit harvesting and grazing or other 
     commercial use of the forage on the land that is subject to 
     the contract in response to a drought or other emergency; and
       ``(iii) shall, in the case of routine managed harvesting or 
     grazing or harvesting or grazing conducted in response to a 
     drought or other emergency, reduce the rental payment 
     otherwise payable under the contract by an amount 
     commensurate with the economic value of the activity; and
       ``(B) the installation of wind turbines, except that in 
     permitting the installation of wind turbines, the Secretary 
     shall determine the number and location of wind turbines that 
     may be installed, taking into account--
       ``(i) the location, size, and other physical 
     characteristics of the land;
       ``(ii) the extent to which the land contains wildlife and 
     wildlife habitat; and
       ``(iii) the purposes of the conservation reserve program 
     under this subchapter;
       ``(8) not to conduct any planting of trees on land that is 
     subject to the contract unless the contract specifies that 
     the harvesting and commercial sale of trees such as Christmas 
     trees are prohibited, nor otherwise make commercial use of 
     trees on land that is subject to the contract unless it is 
     expressly permitted in the contract, nor adopt any similar 
     practice specified in the contract by the Secretary as a 
     practice that would tend to defeat the purposes of the 
     contract, except that no contract shall prohibit activities 
     consistent with customary forestry practice, such as pruning, 
     thinning, or stand improvement of trees, on land converted to 
     forestry use;
       ``(9) not to adopt any practice specified by the Secretary 
     in the contract as a practice that would tend to defeat the 
     purposes of this subchapter; and
       ``(10) to comply with such additional provisions as the 
     Secretary determines are desirable and are included in the 
     contract to carry out this subchapter or to facilitate the 
     practical administration of this subchapter.
       ``(b) Conservation Plans.--The plan referred to in 
     subsection (a)(1)--
       ``(1) shall set forth--
       ``(A) the conservation measures and practices to be carried 
     out by the owner or operator during the term of the contract; 
     and
       ``(B) the commercial use, if any, to be permitted on the 
     land during the term; and
       ``(2) may provide for the permanent retirement of any 
     existing cropland base and allotment history for the land.
       ``(c) Foreclosure.--
       ``(1) In general.--Notwithstanding any other provision of 
     law, an owner or operator who is a party to a contract 
     entered into under this subchapter may not be required to 
     make repayments to the Secretary of amounts received under 
     the contract if the land that is subject to the contract has 
     been foreclosed on and the Secretary determines that 
     forgiving the repayments is appropriate in order to provide 
     fair and equitable treatment.
       ``(2) Resumption of control.--
       ``(A) In general.--This subsection shall not void the 
     responsibilities of an owner or operator under the contract 
     if the owner or operator resumes control over the land that 
     is subject to the contract within the period specified in the 
     contract.
       ``(B) Contract.--On the resumption of the control over the 
     land by the owner or operator, the provisions of the contract 
     in effect on the date of the foreclosure shall apply.

     ``SEC. 1233. DUTIES OF THE SECRETARY.

       ``In return for a contract entered into by an owner or 
     operator under section 1232, the Secretary shall--
       ``(1) share the cost of carrying out the conservation 
     measures and practices set forth in the contract for which 
     the Secretary determines that cost sharing is appropriate and 
     in the public interest; and
       ``(2) for a period of years not in excess of the term of 
     the contract, pay an annual rental payment in an amount 
     necessary to compensate for--
       ``(A) the conversion of highly erodible cropland normally 
     devoted to the production of an agricultural commodity on a 
     farm or ranch to a less intensive use; and
       ``(B) the retirement of any cropland base and allotment 
     history that the owner or operator agrees to retire 
     permanently.

     ``SEC. 1234. PAYMENTS.

       ``(a) Timing.--The Secretary shall provide payment for 
     obligations incurred by the Secretary under a contract 
     entered into under this subchapter--
       ``(1) with respect to any cost-sharing payment obligation 
     incurred by the Secretary, as soon as practicable after the 
     obligation is incurred; and
       ``(2) with respect to any annual rental payment obligation 
     incurred by the Secretary--
       ``(A) as soon as practicable after October 1 of each 
     calendar year; or
       ``(B) at the option of the Secretary, at any time prior to 
     such date during the year that the obligation is incurred.
       ``(b) Federal Percentage of Cost Sharing Payments.--
       ``(1) In general.--In making cost sharing payments to an 
     owner or operator under a contract entered into under this 
     subchapter, the Secretary shall pay 50 percent of the cost of 
     establishing water quality and conservation measures and 
     practices required under each contract for which the 
     Secretary determines that cost sharing is appropriate and in 
     the public interest.
       ``(2) Limitation.--The Secretary shall not make any payment 
     to an owner or operator under this subchapter to the extent 
     that the total amount of cost sharing payments provided to 
     the owner or operator from all sources would exceed 100 
     percent of the total cost of establishing measures and 
     practices described in paragraph (1).
       ``(3) Hardwood trees, windbreaks, shelterbelts, and 
     wildlife corridors.--
       ``(A) Applicability.--This paragraph applies to--
       ``(i) land devoted to the production of hardwood trees, 
     windbreaks, shelterbelts, or wildlife corridors under a 
     contract entered into under this subchapter after November 
     28, 1990; and
       ``(ii) land converted to such production under section 
     1235A.
       ``(B) Payments.--In making cost share payments to an owner 
     or operator of land described in subparagraph (A), the 
     Secretary shall pay 50 percent of the reasonable and 
     necessary costs, as determined by the Secretary, incurred by 
     the owner or operator for maintaining trees or shrubs, 
     including the cost of replanting (if the trees or shrubs were 
     lost due to conditions beyond the control of the owner or 
     operator), during not less than the 2-year, and not more than 
     the 4-year, period beginning on the date of the planting of 
     the trees or shrubs, as determined appropriate by the 
     Secretary.
       ``(4) Hardwood tree planting.--The Secretary may permit 
     owners or operators that contract to devote at least 10 acres 
     of land to the production of hardwood trees under this 
     subchapter to extend the planting of the trees over a 3-year 
     period if at least \1/3\ of the trees are planted in each of 
     the first 2 years.
       ``(5) Other federal cost share assistance.--An owner or 
     operator shall not be eligible to receive or retain cost 
     share assistance under this subsection if the owner or 
     operator receives any other Federal cost share assistance 
     with respect to the land under any other provision of law.
       ``(c) Annual Rental Payments.--
       ``(1) In general.--In determining the amount of annual 
     rental payments to be paid to owners and operators for 
     converting highly erodible cropland normally devoted to the 
     production of

[[Page H1826]]

     an agricultural commodity to less intensive use, the 
     Secretary may consider, among other things, the amount 
     necessary to encourage owners or operators of highly erodible 
     cropland to participate in the program established by this 
     subchapter.
       ``(2) Method of determination.--The amounts payable to 
     owners or operators in the form of rental payments under 
     contracts entered into under this subchapter may be 
     determined through--
       ``(A) the submission of bids for such contracts by owners 
     and operators in such manner as the Secretary may prescribe; 
     or
       ``(B) such other means as the Secretary determines are 
     appropriate.
       ``(3) Acceptance of contract offers.--In determining the 
     acceptability of contract offers, the Secretary may--
       ``(A) take into consideration the extent to which 
     enrollment of the land that is the subject of the contract 
     offer would improve soil resources, water quality, wildlife 
     habitat, or provide other environmental benefits; and
       ``(B) establish different criteria in various States and 
     regions of the United States based on the extent to which 
     water quality or wildlife habitat may be improved or erosion 
     may be abated.
       ``(4) Hardwood tree acreage.--In the case of acreage 
     enrolled in the conservation reserve established under this 
     subchapter that is to be devoted to hardwood trees, the 
     Secretary may consider bids for contracts under this 
     subsection on a continuous basis.
       ``(d) Cash or In-Kind Payments.--
       ``(1) In general.--Except as otherwise provided in this 
     section, payments under this subchapter--
       ``(A) shall be made in cash or in commodities in such 
     amount and on such time schedule as is agreed on and 
     specified in the contract; and
       ``(B) may be made in advance of determination of 
     performance.
       ``(2) Method of providing in-kind payments.--If the payment 
     to an owner or operator is made with in-kind commodities, the 
     payment shall be made by the Commodity Credit Corporation--
       ``(A) by delivery of the commodity involved to the owner or 
     operator at a warehouse or other similar facility located in 
     the county in which the highly erodible cropland is located 
     or at such other location as is agreed to by the Secretary 
     and the owner or operator;
       ``(B) by the transfer of negotiable warehouse receipts; or
       ``(C) by such other method, including the sale of the 
     commodity in commercial markets, as is determined by the 
     Secretary to be appropriate to enable the owner or operator 
     to receive efficient and expeditious possession of the 
     commodity.
       ``(3) Cash payments.--
       ``(A) Commodity credit corporation stocks.--If stocks of a 
     commodity acquired by the Commodity Credit Corporation are 
     not readily available to make full payment in kind to the 
     owner or operator, the Secretary may substitute full or 
     partial payment in cash for payment in kind.
       ``(B) Special conservation reserve enhancement program.--
     Payments to an owner or operator under a special conservation 
     reserve enhancement program described in subsection (f)(4) 
     shall be in the form of cash only.
       ``(e) Payments on Death, Disability, or Succession.--If an 
     owner or operator that is entitled to a payment under a 
     contract entered into under this subchapter dies, becomes 
     incompetent, is otherwise unable to receive the payment, or 
     is succeeded by another person that renders or completes the 
     required performance, the Secretary shall make the payment, 
     in accordance with regulations prescribed by the Secretary 
     and without regard to any other provision of law, in such 
     manner as the Secretary determines is fair and reasonable in 
     light of all of the circumstances.
       ``(f) Payment Limitation for Rental Payments.--
       ``(1) In general.--The total amount of rental payments, 
     including rental payments made in the form of in-kind 
     commodities, made to a person under this subchapter for any 
     fiscal year may not exceed $50,000.
       ``(2) Regulations.--
       ``(A) In general.--The Secretary shall promulgate 
     regulations--
       ``(i) defining the term `person' as used in this 
     subsection; and
       ``(ii) providing such terms and conditions as the Secretary 
     determines necessary to ensure a fair and reasonable 
     application of the limitation established by this subsection.
       ``(B) Corporations and stockholders.--The regulations 
     promulgated by the Secretary on December 18, 1970, under 
     section 101 of the Agricultural Act of 1970 (7 U.S.C. 1307), 
     shall be used to determine whether corporations and their 
     stockholders may be considered as separate persons under this 
     subsection.
       ``(3) Other payments.--Rental payments received by an owner 
     or operator shall be in addition to, and not affect, the 
     total amount of payments that the owner or operator is 
     otherwise eligible to receive under the Farm Security and 
     Rural Investment Act of 2002.
       ``(4) Special conservation reserve enhancement program.--
       ``(A) In general.--The provisions of this subsection that 
     limit payments to any person, and section 1305(d) of the 
     Agricultural Reconciliation Act of 1987 (7 U.S.C. 1308 note; 
     Public Law 100-203), shall not be applicable to payments 
     received by a State, political subdivision, or agency thereof 
     in connection with agreements entered into under a special 
     conservation reserve enhancement program carried out by that 
     entity that has been approved by the Secretary.
       ``(B) Agreements.--The Secretary may enter into such 
     agreements for payments to States (including political 
     subdivisions and agencies of States) that the Secretary 
     determines will advance the purposes of this subchapter.
       ``(g) Other State or Local Assistance.--In addition to any 
     payment under this subchapter, an owner or operator may 
     receive cost share assistance, rental payments, or tax 
     benefits from a State or subdivision thereof for enrolling 
     land in the conservation reserve program.

     ``SEC. 1235. CONTRACTS.

       ``(a) Ownership or Operation Requirements.--
       ``(1) In general.--Except as provided in paragraph (2), no 
     contract shall be entered into under this subchapter 
     concerning land with respect to which the ownership has 
     changed in the 1-year period preceding the first year of the 
     contract period unless--
       ``(A) the new ownership was acquired by will or succession 
     as a result of the death of the previous owner;
       ``(B) the new ownership was acquired before January 1, 
     1985;
       ``(C) the Secretary determines that the land was acquired 
     under circumstances that give adequate assurance that the 
     land was not acquired for the purpose of placing the land in 
     the program established by this subchapter; or
       ``(D) the ownership change occurred due to foreclosure on 
     the land and the owner of the land immediately before the 
     foreclosure exercises a right of redemption from the mortgage 
     holder in accordance with State law.
       ``(2) Exceptions.--Paragraph (1) shall not--
       ``(A) prohibit the continuation of an agreement by a new 
     owner after an agreement has been entered into under this 
     subchapter; or
       ``(B) require a person to own the land as a condition of 
     eligibility for entering into the contract if the person--
       ``(i) has operated the land to be covered by a contract 
     under this section for at least 1 year preceding the date of 
     the contract or since January 1, 1985, whichever is later; 
     and
       ``(ii) controls the land for the contract period.
       ``(b) Sales or Transfers.--If, during the term of a 
     contract entered into under this subchapter, an owner or 
     operator of land subject to the contract sells or otherwise 
     transfers the ownership or right of occupancy of the land, 
     the new owner or operator of the land may--
       ``(1) continue the contract under the same terms or 
     conditions;
       ``(2) enter into a new contract in accordance with this 
     subchapter; or
       ``(3) elect not to participate in the program established 
     by this subchapter.
       ``(c) Modifications.--
       ``(1) In general.--The Secretary may modify a contract 
     entered into with an owner or operator under this subchapter 
     if--
       ``(A) the owner or operator agrees to the modification; and
       ``(B) the Secretary determines that the modification is 
     desirable--
       ``(i) to carry out this subchapter;
       ``(ii) to facilitate the practical administration of this 
     subchapter; or
       ``(iii) to achieve such other goals as the Secretary 
     determines are appropriate, consistent with this subchapter.
       ``(2) Production of agricultural commodities.--The 
     Secretary may modify or waive a term or condition of a 
     contract entered into under this subchapter in order to 
     permit all or part of the land subject to such contract to be 
     devoted to the production of an agricultural commodity during 
     a crop year, subject to such conditions as the Secretary 
     determines are appropriate.
       ``(d) Termination.--
       ``(1) In general.--The Secretary may terminate a contract 
     entered into with an owner or operator under this subchapter 
     if--
       ``(A) the owner or operator agrees to the termination; and
       ``(B) the Secretary determines that the termination would 
     be in the public interest.
       ``(2) Notice to congressional committees.--At least 90 days 
     before taking any action to terminate under paragraph (1) all 
     conservation reserve contracts entered into under this 
     subchapter, the Secretary shall provide to the Committee on 
     Agriculture of the House of Representatives and the Committee 
     on Agriculture, Nutrition, and Forestry of the Senate written 
     notice of the action.
       ``(e) Early Termination by Owner or Operator.--
       ``(1) Early termination.--
       ``(A) In general.--The Secretary shall allow a participant 
     that entered into a contract under this subchapter before 
     January 1, 1995, to terminate the contract at any time if the 
     contract has been in effect for at least 5 years.
       ``(B) Liability for contract violation.--The termination 
     shall not relieve the participant of liability for a contract 
     violation occurring before the date of the termination.
       ``(C) Notice to secretary.--The participant shall provide 
     the Secretary with reasonable notice of the desire of the 
     participant to terminate the contract.
       ``(2) Certain land excepted.--The following land shall not 
     be subject to an early termination of contract under this 
     subsection:
       ``(A) Filterstrips, waterways, strips adjacent to riparian 
     areas, windbreaks, and shelterbelts.
       ``(B) Land with an erodibility index of more than 15.
       ``(C) Other land of high environmental value (including 
     wetland), as determined by the Secretary.
       ``(3) Effective date.--The contract termination shall 
     become effective 60 days after the date on which the owner or 
     operator submits the notice required under paragraph (1)(C).
       ``(4) Prorated rental payment.--If a contract entered into 
     under this subchapter is terminated under this subsection 
     before the end of the fiscal year for which a rental payment 
     is due, the Secretary shall provide a prorated rental payment 
     covering the portion of the fiscal year during which the 
     contract was in effect.

[[Page H1827]]

       ``(5) Renewed enrollment.--The termination of a contract 
     entered into under this subchapter shall not affect the 
     ability of the owner or operator that requested the 
     termination to submit a subsequent bid to enroll the land 
     that was subject to the contract into the conservation 
     reserve.
       ``(6) Conservation requirements.--If land that was subject 
     to a contract is returned to production of an agricultural 
     commodity, the conservation requirements under subtitles B 
     and C shall apply to the use of the land to the extent that 
     the requirements are similar to those requirements imposed on 
     other similar land in the area, except that the requirements 
     may not be more onerous than the requirements imposed on 
     other land.

     ``SEC. 1235A. CONVERSION OF LAND SUBJECT TO CONTRACT TO OTHER 
                   CONSERVING USES.

       ``(a) Conversion to Trees.--
       ``(1) In general.--The Secretary shall permit an owner or 
     operator that has entered into a contract under this 
     subchapter that is in effect on November 28, 1990, to convert 
     areas of highly erodible cropland that are subject to the 
     contract, and that are devoted to vegetative cover, from that 
     use to hardwood trees, windbreaks, shelterbelts, or wildlife 
     corridors.
       ``(2) Terms.--
       ``(A) Extension of contract.--With respect to a contract 
     that is modified under this section that provides for the 
     planting of hardwood trees, windbreaks, shelterbelts, or 
     wildlife corridors, if the original term of the contract was 
     less than 15 years, the owner or operator may extend the 
     contract to a term of not to exceed 15 years.
       ``(B) Cost share assistance.--The Secretary shall pay 50 
     percent of the cost of establishing conservation measures and 
     practices authorized under this subsection for which the 
     Secretary determines the cost sharing is appropriate and in 
     the public interest.
       ``(b) Conversion to Wetland.--The Secretary shall permit an 
     owner or operator that has entered into a contract under this 
     subchapter that is in effect on November 28, 1990, to restore 
     areas of highly erodible cropland that are devoted to 
     vegetative cover under the contract to wetland if--
       ``(1) the areas are prior converted wetland;
       ``(2) the owner or operator of the areas enters into an 
     agreement to provide the Secretary with a long-term or 
     permanent easement under subchapter C covering the areas;
       ``(3) there is a high probability that the prior converted 
     area can be successfully restored to wetland status; and
       ``(4) the restoration of the areas otherwise meets the 
     requirements of subchapter C.
       ``(c) Limitation.--The Secretary shall not incur, through a 
     conversion under this section, any additional expense on the 
     acres, including the expense involved in the original 
     establishment of the vegetative cover, that would result in 
     cost share for costs under this section in excess of the 
     costs that would have been subject to cost share for the new 
     practice had that practice been the original practice.
       ``(d) Condition of Contract.--An owner or operator shall as 
     a condition of entering into a contract under subsection (a) 
     participate in the Forest Stewardship Program established 
     under section 5 of the Cooperative Forestry Assistance Act of 
     1978 (16 U.S.C. 2103a).''.
       (b) Study on Economic Effects.--
       (1) In general.--Not later than 18 months after the date of 
     enactment of this Act, the Secretary of Agriculture shall 
     submit to the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate a report that describes the 
     economic and social effects on rural communities resulting 
     from the conservation reserve program established under 
     subchapter B of chapter 1 of subtitle D of title XII of the 
     Food Security Act of 1985 (16 U.S.C. 3831 et seq.).
       (2) Components.--The study under paragraph (1) shall 
     include analyses of--
       (A) the impact that enrollments in the conservation reserve 
     program have on rural businesses, civic organizations, and 
     community services (such as schools, public safety, and 
     infrastructure), particularly in communities with a large 
     percentage of whole farm enrollments;
       (B) the effect that those enrollments have on rural 
     population and beginning farmers (including a description of 
     any connection between the rate of enrollment and the 
     incidence of absentee ownership);
       (C)(i) the manner in which differential per acre payment 
     rates potentially impact the types of land (by productivity) 
     enrolled;
       (ii) changes to the per acre payment rates that may affect 
     that impact; and
       (iii) the manner in which differential per acre payment 
     rates could facilitate retention of productive agricultural 
     land in agriculture; and
       (D) the effect of enrollment on opportunities for 
     recreational activities (including hunting and fishing).
                  Subtitle C--Wetlands Reserve Program

     SEC. 2201. REAUTHORIZATION.

       Section 1237(c) of the Food Security Act of 1985 (16 U.S.C. 
     3837(c)) is amended by striking ``2002'' and inserting 
     ``2007''.

     SEC. 2202. ENROLLMENT.

       Section 1237 of the Food Security Act of 1985 (16 U.S.C. 
     3837) is amended--
       (1) by striking subsection (b) and inserting the following:
       ``(b) Enrollment Conditions.--
       ``(1) Maximum enrollment.--The total number of acres 
     enrolled in the wetlands reserve program shall not exceed 
     2,275,000 acres, of which, to the maximum extent practicable, 
     the Secretary shall enroll 250,000 acres in each calendar 
     year.
       ``(2) Methods of enrollment.--The Secretary shall enroll 
     acreage into the wetlands reserve program through the use of 
     permanent easements, 30-year easements, restoration cost 
     share agreements, or any combination of those options.''; and
       (2) by striking subsection (g).

     SEC. 2203. EASEMENTS AND AGREEMENTS.

       Section 1237A of the Food Security Act of 1985 (16 U.S.C. 
     3837a) is amended by striking subsection (h).

     SEC. 2204. CHANGES IN OWNERSHIP; AGREEMENT MODIFICATION; 
                   TERMINATION.

       Section 1237E(a) of the Food Security Act of 1985 (16 
     U.S.C. 3837e(a)) is amended by striking paragraph (2) and 
     inserting the following:
       ``(2)(A) the ownership change occurred because of 
     foreclosure on the land; and
       ``(B) immediately before the foreclosure, the owner of the 
     land exercises a right of redemption from the mortgage holder 
     in accordance with State law; or''.
              Subtitle D--Environmental Quality Incentives

     SEC. 2301. ENVIRONMENTAL QUALITY INCENTIVES PROGRAM.

       Chapter 4 of subtitle D of title XII of the Food Security 
     Act of 1985 (16 U.S.C. 3839aa et seq.) is amended to read as 
     follows:

     ``SEC. 1240. PURPOSES.

       ``The purposes of the environmental quality incentives 
     program established by this chapter are to promote 
     agricultural production and environmental quality as 
     compatible goals, and to optimize environmental benefits, 
     by--
       ``(1) assisting producers in complying with local, State, 
     and national regulatory requirements concerning--
       ``(A) soil, water, and air quality;
       ``(B) wildlife habitat; and
       ``(C) surface and ground water conservation;
       ``(2) avoiding, to the maximum extent practicable, the need 
     for resource and regulatory programs by assisting producers 
     in protecting soil, water, air, and related natural resources 
     and meeting environmental quality criteria established by 
     Federal, State, tribal, and local agencies;
       ``(3) providing flexible assistance to producers to install 
     and maintain conservation practices that enhance soil, water, 
     related natural resources (including grazing land and 
     wetland), and wildlife while sustaining production of food 
     and fiber;
       ``(4) assisting producers to make beneficial, cost 
     effective changes to cropping systems, grazing management, 
     nutrient management associated with livestock, pest or 
     irrigation management, or other practices on agricultural 
     land; and
       ``(5) consolidating and streamlining conservation planning 
     and regulatory compliance processes to reduce administrative 
     burdens on producers and the cost of achieving environmental 
     goals.

     ``SEC. 1240A. DEFINITIONS.

       ``In this chapter:
       ``(1) Beginning farmer or rancher.--The term `beginning 
     farmer or rancher' has the meaning provided under section 
     343(a) of the Consolidated Farm and Rural Development Act (7 
     U.S.C. 1999(a)).
       ``(2) Eligible land.--
       ``(A) In general.--The term `eligible land' means land on 
     which agricultural commodities or livestock are produced.
       ``(B) Inclusions.--The term `eligible land' includes--
       ``(i) cropland;
       ``(ii) grassland;
       ``(iii) rangeland;
       ``(iv) pasture land;
       ``(v) private, nonindustrial forest land; and
       ``(vi) other agricultural land that the Secretary 
     determines poses a serious threat to soil, air, water, or 
     related resources.
       ``(3) Land management practice.--The term `land management 
     practice' means a site-specific nutrient or manure 
     management, integrated pest management, irrigation 
     management, tillage or residue management, grazing 
     management, air quality management, or other land management 
     practice carried out on eligible land that the Secretary 
     determines is needed to protect from degradation, in the most 
     cost-effective manner, water, soil, or related resources.
       ``(4) Livestock.--The term `livestock' means dairy cattle, 
     beef cattle, laying hens, broilers, turkeys, swine, sheep, 
     and other such animals as are determined by the Secretary.
       ``(5) Practice.--The term `practice' means 1 or more 
     structural practices, land management practices, and 
     comprehensive nutrient management planning practices.
       ``(6) Structural practice.--The term `structural practice' 
     means--
       ``(A) the establishment on eligible land of a site-specific 
     animal waste management facility, terrace, grassed waterway, 
     contour grass strip, filterstrip, tailwater pit, permanent 
     wildlife habitat, constructed wetland, or other structural 
     practice that the Secretary determines is needed to protect, 
     in the most cost effective manner, water, soil, or related 
     resources from degradation; and
       ``(B) the capping of abandoned wells on eligible land.

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

       ``(a) Establishment.--
       ``(1) In general.--During each of the 2002 through 2007 
     fiscal years, the Secretary shall provide cost-share payments 
     and incentive payments to producers that enter into contracts 
     with the Secretary under the program.
       ``(2) Eligible practices.--With respect to practices 
     implemented under this chapter--
       ``(A) a producer that implements a structural practice in 
     accordance with this chapter shall be eligible to receive 
     cost-share payments; and
       ``(B) a producer that implements a land management 
     practice, or develops a comprehensive

[[Page H1828]]

     nutrient management plan, in accordance with this chapter 
     shall be eligible to receive incentive payments.
       ``(b) Practices and Term.--
       ``(1) Practices.--A contract under this chapter may apply 
     to 1 or more structural practices, land management practices, 
     and comprehensive nutrient management practices.
       ``(2) Term.--A contract under this chapter shall have a 
     term that--
       ``(A) at a minimum, is equal to the period beginning on the 
     date on which the contract is entered into and ending on the 
     date that is 1 year after the date on which all practices 
     under the contract have been implemented; but
       ``(B) not to exceed 10 years.
       ``(c) Bidding Down.--If the Secretary determines that the 
     environmental values of 2 or more applications for cost-share 
     payments or incentive payments are comparable, the Secretary 
     shall not assign a higher priority to the application only 
     because it would present the least cost to the program 
     established under the program.
       ``(d) Cost-Share Payments.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     cost-share payments provided to a producer proposing to 
     implement 1 or more practices under the program shall be not 
     more than 75 percent of the cost of the practice, as 
     determined by the Secretary.
       ``(2) Exceptions.--
       ``(A) Limited resource and beginning farmers.--The 
     Secretary may increase the amount provided to a producer 
     under paragraph (1) to not more than 90 percent if the 
     producer is a limited resource or beginning farmer or 
     rancher, as determined by the Secretary.
       ``(B) Cost-share assistance from other sources.--Except as 
     provided in paragraph (3), any cost-share payments received 
     by a producer from a State or private organization or person 
     for the implementation of 1 or more practices on eligible 
     land of the producer shall be in addition to the payments 
     provided to the producer under paragraph (1).
       ``(3) Other payments.--A producer shall not be eligible for 
     cost-share payments for practices on eligible land under the 
     program if the producer receives cost-share payments or other 
     benefits for the same practice on the same land under chapter 
     1 and the program.
       ``(e) Incentive Payments.--
       ``(1) In general.--The Secretary shall make incentive 
     payments in an amount and at a rate determined by the 
     Secretary to be necessary to encourage a producer to perform 
     1 or more land management practices.
       ``(2) Special rule.--In determining the amount and rate of 
     incentive payments, the Secretary may accord great 
     significance to a practice that promotes residue, nutrient, 
     pest, invasive species, or air quality management.
       ``(f) Modification or Termination of Contracts.--
       ``(1) Voluntary modification or termination.--The Secretary 
     may modify or terminate a contract entered into with a 
     producer under this chapter if--
       ``(A) the producer agrees to the modification or 
     termination; and
       ``(B) the Secretary determines that the modification or 
     termination is in the public interest.
       ``(2) Involuntary termination.--The Secretary may terminate 
     a contract under this chapter if the Secretary determines 
     that the producer violated the contract.
       ``(g) Allocation of Funding.--For each of fiscal years 2002 
     through 2007, 60 percent of the funds made available for 
     cost-share payments and incentive payments under this chapter 
     shall be targeted at practices relating to livestock 
     production.

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

       ``In evaluating applications for cost-share payments and 
     incentive payments, the Secretary shall accord a higher 
     priority to assistance and payments that--
       ``(1) encourage the use by producers of cost-effective 
     conservation practices; and
       ``(2) address national conservation priorities.

     ``SEC. 1240D. DUTIES OF PRODUCERS.

       ``To receive technical assistance, cost-share payments, or 
     incentive payments under the program, a producer shall 
     agree--
       ``(1) to implement an environmental quality incentives 
     program plan (including a comprehensive nutrient management 
     plan, if applicable) that describes conservation and 
     environmental purposes to be achieved through 1 or more 
     practices that are approved by the Secretary;
       ``(2) not to conduct any practices on the farm or ranch 
     that would tend to defeat the purposes of the program;
       ``(3) on the violation of a term or condition of the 
     contract at anytime the producer has control of the land--
       ``(A) if the Secretary determines that the violation 
     warrants termination of the contract--
       ``(i) to forfeit all rights to receive payments under the 
     contract; and
       ``(ii) to refund to the Secretary all or a portion of the 
     payments received by the owner or operator under the 
     contract, including any interest on the payments, as 
     determined by the Secretary; or
       ``(B) if the Secretary determines that the violation does 
     not warrant termination of the contract, to refund to the 
     Secretary, or accept adjustments to, the payments provided to 
     the owner or operator, as the Secretary determines to be 
     appropriate;
       ``(4) on the transfer of the right and interest of the 
     producer in land subject to the contract, unless the 
     transferee of the right and interest agrees with the 
     Secretary to assume all obligations of the contract, to 
     refund all cost-share payments and incentive payments 
     received under the program, as determined by the Secretary;
       ``(5) to supply information as required by the Secretary to 
     determine compliance with the program plan and requirements 
     of the program; and
       ``(6) to comply with such additional provisions as the 
     Secretary determines are necessary to carry out the program 
     plan.

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

       ``(a) In General.--To be eligible to receive cost-share 
     payments or incentive payments under the program, a producer 
     shall submit to the Secretary for approval a plan of 
     operations that--
       ``(1) specifies practices covered under the program;
       ``(2) includes such terms and conditions as the Secretary 
     considers necessary to carry out the program, including a 
     description of the purposes to be met by the implementation 
     of the plan; and
       ``(3) in the case of a confined livestock feeding 
     operation, provides for development and implementation of a 
     comprehensive nutrient management plan, if applicable.
       ``(b) Avoidance of Duplication.--The Secretary shall, to 
     the maximum extent practicable, eliminate duplication of 
     planning activities under the program under this chapter and 
     comparable conservation programs.

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

       ``To the extent appropriate, the Secretary shall assist a 
     producer in achieving the conservation and environmental 
     goals of a program plan by--
       ``(1) providing cost-share payments or incentive payments 
     for developing and implementing 1 or more practices, as 
     appropriate; and
       ``(2) providing the producer with information and training 
     to aid in implementation of the plan.

     ``SEC. 1240G. LIMITATION ON PAYMENTS.

       ``An individual or entity may not receive, directly or 
     indirectly, cost-share or incentive payments under this 
     chapter that, in the aggregate, exceed $450,000 for all 
     contracts entered into under this chapter by the individual 
     or entity during the period of fiscal years 2002 through 
     2007, regardless of the number of contracts entered into 
     under this chapter by the individual or entity.

     ``SEC. 1240H. CONSERVATION INNOVATION GRANTS.

       ``(a) In General.--The Secretary may pay the cost of 
     competitive grants that are intended to stimulate innovative 
     approaches to leveraging Federal investment in environmental 
     enhancement and protection, in conjunction with agricultural 
     production, through the program.
       ``(b) Use.--The Secretary may provide grants under this 
     section to governmental and nongovernmental organizations and 
     persons, on a competitive basis, to carry out projects that--
       ``(1) involve producers that are eligible for payments or 
     technical assistance under the program;
       ``(2) implement projects, such as--
       ``(A) market systems for pollution reduction; and
       ``(B) innovative conservation practices, including the 
     storing of carbon in the soil; and
       ``(3) leverage funds made available to carry out the 
     program under this chapter with matching funds provided by 
     State and local governments and private organizations to 
     promote environmental enhancement and protection in 
     conjunction with agricultural production.
       ``(c) Cost Share.--The amount of a grant made under this 
     section to carry out a project shall not exceed 50 percent of 
     the cost of the project.

     ``SEC. 1240I. GROUND AND SURFACE WATER CONSERVATION.

       ``(a) Establishment.--In carrying out the program under 
     this chapter, subject to subsection (b), the Secretary shall 
     promote ground and surface water conservation by providing 
     cost-share payments, incentive payments, and loans to 
     producers to carry out eligible water conservation activities 
     with respect to the agricultural operations of producers, 
     to--
       ``(1) improve irrigation systems;
       ``(2) enhance irrigation efficiencies;
       ``(3) convert to--
       ``(A) the production of less water-intensive agricultural 
     commodities; or
       ``(B) dryland farming;
       ``(4) improve the storage of water through measures such as 
     water banking and groundwater recharge;
       ``(5) mitigate the effects of drought; or
       ``(6) institute other measures that improve groundwater and 
     surface water conservation, as determined by the Secretary, 
     in the agricultural operations of producers.
       ``(b) Net Savings.--The Secretary may provide assistance to 
     a producer under this section only if the Secretary 
     determines that the assistance will facilitate a conservation 
     measure that results in a net savings in groundwater or 
     surface water resources in the agricultural operation of the 
     producer.
       ``(c) Funding.--Of the funds of the Commodity Credit 
     Corporation, in addition to amounts made available under 
     section 1241(a)(6) to carry out this chapter, the Secretary 
     shall use--
       ``(1) to carry out this section--
       ``(A) $25,000,000 for fiscal year 2002;
       ``(B) $45,000,000 for fiscal year 2003; and
       ``(C) $60,000,000 for each of fiscal years 2004 through 
     2007; and
       ``(2) $50,000,000 to carry out water conservation 
     activities in Klamath Basin, California and Oregon, to be 
     made available as soon as practicable after the date of 
     enactment of this section.''.
                     Subtitle E--Grassland Reserve

     SEC. 2401. GRASSLAND RESERVE PROGRAM.

       Chapter 2 of the Food Security Act of 1985 (as amended by 
     section 2001) is amended by adding at the end the following:

[[Page H1829]]

               ``Subchapter C--Grassland Reserve Program

     ``SEC. 1238N. GRASSLAND RESERVE PROGRAM.

       ``(a) Establishment.--The Secretary shall establish a 
     grassland reserve program (referred to in this subchapter as 
     the `program') to assist owners in restoring and conserving 
     eligible land described in subsection (c).
       ``(b) Enrollment Conditions.--
       ``(1) Maximum enrollment.--The total number of acres 
     enrolled in the program shall not exceed 2,000,000 acres of 
     restored or improved grassland, rangeland, and pastureland.
       ``(2) Methods of enrollment.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the Secretary shall enroll in the program from a willing 
     owner not less than 40 contiguous acres of land through the 
     use of--
       ``(i) a 10-year, 15-year, or 20-year rental agreement;
       ``(ii)(I) a 30-year rental agreement or permanent or 30-
     year easement; or
       ``(II) in a State that imposes a maximum duration for 
     easements, an easement for the maximum duration allowed under 
     State law.
       ``(B) Waiver.--The Secretary may enroll in the program such 
     parcels of land that are less than 40 acres as the Secretary 
     determines are appropriate to achieve the purposes of the 
     program.
       ``(3) Limitation on use of easements and rental 
     agreements.--Of the total amount of funds expended under the 
     program to acquire easements and rental agreements described 
     in paragraph (2)(A)--
       ``(A) not more than 40 percent shall be used for rental 
     agreements described in paragraph (2)(A)(i); and
       ``(B) not more than 60 percent shall be used for easements 
     and rental agreements described in paragraph (2)(A)(ii).
       ``(c) Eligible Land.--Land shall be eligible to be enrolled 
     in the program if the Secretary determines that the land is 
     private land that is--
       ``(1) grassland, land that contains forbs, or shrubland 
     (including improved rangeland and pastureland); or
       ``(2) land that--
       ``(A) is located in an area that has been historically 
     dominated by grassland, forbs, or shrubland; and
       ``(B) has potential to serve as habitat for animal or plant 
     populations of significant ecological value if the land is--
       ``(i) retained in the current use of the land; or
       ``(ii) restored to a natural condition; or
       ``(3) land that is incidental to land described in 
     paragraph (1) or (2), if the incidental land is determined by 
     the Secretary to be necessary for the efficient 
     administration of an agreement or easement.

     ``SEC. 1238O. REQUIREMENTS RELATING TO EASEMENTS AND 
                   AGREEMENTS.

       ``(a) Requirements of Landowner.--
       ``(1) In general.--To be eligible to enroll land in the 
     program through the grant of an easement, the owner of the 
     land shall enter into an agreement with the Secretary--
       ``(A) to grant an easement that applies to the land to the 
     Secretary;
       ``(B) to create and record an appropriate deed restriction 
     in accordance with applicable State law to reflect the 
     easement;
       ``(C) to provide a written statement of consent to the 
     easement signed by persons holding a security interest or any 
     vested interest in the land;
       ``(D) to provide proof of unencumbered title to the 
     underlying fee interest in the land that is the subject of 
     the easement; and
       ``(E) to comply with the terms of the easement and 
     restoration agreement.
       ``(2) Agreements.--To be eligible to enroll land in the 
     program under an agreement, the owner or operator of the land 
     shall agree--
       ``(A) to comply with the terms of the agreement (including 
     any related restoration agreements); and
       ``(B) to the suspension of any existing cropland base and 
     allotment history for the land under a program administered 
     by the Secretary.
       ``(b) Terms of Easement or Rental Agreement.--An easement 
     or rental agreement under subsection (a) shall--
       ``(1) permit--
       ``(A) common grazing practices, including maintenance and 
     necessary cultural practices, on the land in a manner that is 
     consistent with maintaining the viability of grassland, forb, 
     and shrub species common to that locality;
       ``(B) subject to appropriate restrictions during the 
     nesting season for birds in the local area that are in 
     significant decline or are conserved in accordance with 
     Federal or State law, as determined by the Natural Resources 
     Conservation Service State conservationist, haying, mowing, 
     or harvesting for seed production; and
       ``(C) fire rehabilitation and construction of fire breaks 
     and fences (including placement of the posts necessary for 
     fences);
       ``(2) prohibit--
       ``(A) the production of crops (other than hay), fruit 
     trees, vineyards, or any other agricultural commodity that 
     requires breaking the soil surface; and
       ``(B) except as permitted under this subsection or 
     subsection (d), the conduct of any other activity that would 
     disturb the surface of the land covered by the easement or 
     rental agreement; and
       ``(3) include such additional provisions as the Secretary 
     determines are appropriate to carry out or facilitate the 
     administration of this subchapter.
       ``(c) Evaluation and Ranking of Easement and Rental 
     Agreement Applications.--
       ``(1) In general.--The Secretary shall establish criteria 
     to evaluate and rank applications for easements and rental 
     agreements under this subchapter.
       ``(2) Considerations.--In establishing the criteria, the 
     Secretary shall emphasize support for--
       ``(A) grazing operations;
       ``(B) plant and animal biodiversity; and
       ``(C) grassland, land that contains forbs, and shrubland 
     under the greatest threat of conversion.
       ``(d) Restoration Agreements.--
       ``(1) In general.--The Secretary shall prescribe the terms 
     of a restoration agreement by which grassland, land that 
     contains forbs, or shrubland that is subject to an easement 
     or rental agreement entered into under the program shall be 
     restored.
       ``(2) Requirements.--The restoration agreement shall 
     describe the respective duties of the owner and the Secretary 
     (including the Federal share of restoration payments and 
     technical assistance).
       ``(e) Violations.--On a violation of the terms or 
     conditions of an easement, rental agreement, or restoration 
     agreement entered into under this section--
       ``(1) the easement or rental agreement shall remain in 
     force; and
       ``(2) the Secretary may require the owner to refund all or 
     part of any payments received by the owner under this 
     subchapter, with interest on the payments as determined 
     appropriate by the Secretary.

     ``SEC. 1238P. DUTIES OF SECRETARY.

       ``(a) In general.--In return for the granting of an 
     easement, or the execution of a rental agreement, by an owner 
     under this subchapter, the Secretary shall, in accordance 
     with this section--
       ``(1) make easement or rental agreement payments to the 
     owner in accordance with subsection (b); and
       ``(2) make payments to the owner for the Federal share of 
     the cost of restoration in accordance with subsection (c).
       ``(b) Payments.--
       ``(1) Easement payments.--
       ``(A) Amount.--In return for the granting of an easement by 
     an owner under this subchapter, the Secretary shall make 
     easement payments to the owner in an amount equal to--
       ``(i) in the case of a permanent easement, the fair market 
     value of the land less the grazing value of the land 
     encumbered by the easement; and
       ``(ii) in the case of a 30-year easement or an easement for 
     the maximum duration allowed under applicable State law, 30 
     percent of the fair market value of the land less the grazing 
     value of the land for the period during which the land is 
     encumbered by the easement.
       ``(B) Schedule.--Easement payments may be provided in not 
     less than 1 payment nor more than 10 annual payments of equal 
     or unequal amount, as agreed to by the Secretary and the 
     owner.
       ``(2) Rental agreement payments.--In return for entering 
     into a rental agreement by an owner under this subchapter, 
     the Secretary shall make annual payments to the owner during 
     the term of the rental agreement in an amount that is not 
     more than 75 percent of the grazing value of the land covered 
     by the contract.
       ``(c) Federal Share of Restoration.--The Secretary shall 
     make payments to an owner under this section of not more 
     than--
       ``(1) in the case of grassland, land that contains forbs, 
     or shrubland that has never been cultivated, 90 percent of 
     the costs of carrying out measures and practices necessary to 
     restore functions and values of that land; or
       ``(2) in the case of restored grassland, land that contains 
     forbs, or shrubland, 75 percent of those costs.
       ``(d) Payments to Others.--If an owner that is entitled to 
     a payment under this subchapter dies, becomes incompetent, is 
     otherwise unable to receive the payment, or is succeeded by 
     another person who renders or completes the required 
     performance, the Secretary shall make the payment, in 
     accordance with regulations promulgated by the Secretary and 
     without regard to any other provision of law, in such manner 
     as the Secretary determines is fair and reasonable in light 
     of all the circumstances.

     ``SEC. 1238Q. DELEGATION TO PRIVATE ORGANIZATIONS.

       ``(a) In General.--The Secretary may permit a private 
     conservation or land trust organization (referred to in this 
     section as a `private organization') or a State agency to 
     hold and enforce an easement under this subchapter, in lieu 
     of the Secretary, subject to the right of the Secretary to 
     conduct periodic inspections and enforce the easement, if--
       ``(1) the Secretary determines that granting the permission 
     will promote protection of grassland, land that contains 
     forbs, and shrubland;
       ``(2) the owner authorizes the private organization or 
     State agency to hold and enforce the easement; and
       ``(3) the private organization or State agency agrees to 
     assume the costs incurred in administering and enforcing the 
     easement, including the costs of restoration or 
     rehabilitation of the land as specified by the owner and the 
     private organization or State agency.
       ``(b) Application.--A private organization or State agency 
     that seeks to hold and enforce an easement under this 
     subchapter shall apply to the Secretary for approval.
       ``(c) Approval by Secretary.--The Secretary may approve a 
     private organization to hold and enforce an easement under 
     this subchapter if (as determined by the Secretary) the 
     private organization--
       ``(1)(A) is an organization described in section 501(c)(3) 
     of the Internal Revenue Code of 1986 that is exempt from 
     taxation under section 501(a) of that Code; or
       ``(B) is described in section 509(a)(3), and is controlled 
     by an organization described in section 509(a)(2), of that 
     Code;
       ``(2) has the relevant experience necessary to administer 
     grassland and shrubland easements;

[[Page H1830]]

       ``(3) has a charter that describes the commitment of the 
     private organization to conserving ranchland, agricultural 
     land, or grassland for grazing and conservation purposes; and
       ``(4) has the resources necessary to effectuate the 
     purposes of the charter.
       ``(d) Reassignment.--
       ``(1) In general.--If a private organization holding an 
     easement on land under this subchapter terminates, not later 
     than 30 days after termination of the private organization, 
     the owner of the land shall reassign the easement to--
       ``(A) a new private organization that is approved by the 
     Secretary; or
       ``(B) the Secretary.
       ``(2) Notification of secretary.--
       ``(A) In general.--If the easement is reassigned to a new 
     private organization, not later than 60 days after the date 
     of reassignment, the owner and the new organization shall 
     notify the Secretary in writing that a reassignment for 
     termination has been made.
       ``(B) Failure to notify.--If the owner and the new 
     organization fail to notify the Secretary of the reassignment 
     in accordance with subparagraph (A), the easement shall 
     revert to the control of the Secretary.''.
                Subtitle F--Other Conservation Programs

     SEC. 2501. AGRICULTURAL MANAGEMENT ASSISTANCE.

       Section 524 of the Federal Crop Insurance Act (7 U.S.C. 
     1524) is amended by striking subsection (b) and inserting the 
     following:
       ``(b) Agricultural Management Assistance.--
       ``(1) Authority.--The Secretary shall provide financial 
     assistance to producers in the States of Connecticut, 
     Delaware, Maryland, Massachusetts, Maine, Nevada, New 
     Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, 
     Utah, Vermont, West Virginia, and Wyoming.
       ``(2) Uses.--A producer may use financial assistance 
     provided under this subsection to--
       ``(A) construct or improve--
       ``(i) watershed management structures; or
       ``(ii) irrigation structures;
       ``(B) plant trees to form windbreaks or to improve water 
     quality;
       ``(C) mitigate financial risk through production or 
     marketing diversification or resource conservation practices, 
     including--
       ``(i) soil erosion control;
       ``(ii) integrated pest management;
       ``(iii) organic farming; or
       ``(iv) to develop and implement a plan to create marketing 
     opportunities for the producer, including through value-added 
     processing;
       ``(D) enter into futures, hedging, or options contracts in 
     a manner designed to help reduce production, price, or 
     revenue risk;
       ``(E) enter into agricultural trade options as a hedging 
     transaction to reduce production, price, or revenue risk; or
       ``(F) conduct any other activity relating to an activity 
     described in subparagraphs (A) through (E), as determined by 
     the Secretary.
       ``(3) Payment limitation.--The total amount of payments 
     made to a person (as defined in section 1001(5) of the Food 
     Security Act (7 U.S.C. 1308(5))) under this subsection for 
     any year may not exceed $50,000.
       ``(4) Commodity credit corporation.--
       ``(A) In general.--The Secretary shall carry out this 
     subsection through the Commodity Credit Corporation.
       ``(B) Funding.--
       ``(i) In general.--Except as provided in clause (ii), the 
     Commodity Credit Corporation shall make available to carry 
     out this subsection not less than $10,000,000 for each fiscal 
     year.
       ``(ii) Exception.--For each of fiscal years 2003 through 
     2007, the Commodity Credit Corporation shall make available 
     to carry out this subsection $20,000,000.''.

     SEC. 2502. GRAZING, WILDLIFE HABITAT INCENTIVE, SOURCE WATER 
                   PROTECTION, AND GREAT LAKES BASIN PROGRAMS.

       (a) In General.--Chapter 5 of subtitle D of title XII of 
     the Food Security Act of 1985 (16 U.S.C. 3839bb et seq.) is 
     amended to read as follows:

                ``CHAPTER 5--OTHER CONSERVATION PROGRAMS

     ``SEC. 1240M. CONSERVATION OF PRIVATE GRAZING LAND.

       ``(a) Purpose.--It is the purpose of this section to 
     authorize the Secretary to provide a coordinated technical, 
     educational, and related assistance program to conserve and 
     enhance private grazing land resources and provide related 
     benefits to all citizens of the United States by--
       ``(1) establishing a coordinated and cooperative Federal, 
     State, and local grazing conservation program for management 
     of private grazing land;
       ``(2) strengthening technical, educational, and related 
     assistance programs that provide assistance to owners and 
     managers of private grazing land;
       ``(3) conserving and improving wildlife habitat on private 
     grazing land;
       ``(4) conserving and improving fish habitat and aquatic 
     systems through grazing land conservation treatment;
       ``(5) protecting and improving water quality;
       ``(6) improving the dependability and consistency of water 
     supplies;
       ``(7) identifying and managing weed, noxious weed, and 
     brush encroachment problems on private grazing land; and
       ``(8) integrating conservation planning and management 
     decisions by owners and managers of private grazing land, on 
     a voluntary basis.
       ``(b) Definitions.--In this section:
       ``(1) Department.--The term `Department' means the 
     Department of Agriculture.
       ``(2) Private grazing land.--The term `private grazing 
     land' means private, State-owned, tribally-owned, and any 
     other non-federally owned rangeland, pastureland, grazed 
     forest land, and hay land.
       ``(3) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture.
       ``(c) Private Grazing Land Conservation Assistance.--
       ``(1) Assistance to grazing landowners and others.--Subject 
     to the availability of appropriations for this section, the 
     Secretary shall establish a voluntary program to provide 
     technical, educational, and related assistance to owners and 
     managers of private grazing land and public agencies, through 
     local conservation districts, to enable the landowners, 
     managers, and public agencies to voluntarily carry out 
     activities that are consistent with this section, including--
       ``(A) maintaining and improving private grazing land and 
     the multiple values and uses that depend on private grazing 
     land;
       ``(B) implementing grazing land management technologies;
       ``(C) managing resources on private grazing land, 
     including--
       ``(i) planning, managing, and treating private grazing land 
     resources;
       ``(ii) ensuring the long-term sustainability of private 
     grazing land resources;
       ``(iii) harvesting, processing, and marketing private 
     grazing land resources; and
       ``(iv) identifying and managing weed, noxious weed, and 
     brush encroachment problems;
       ``(D) protecting and improving the quality and quantity of 
     water yields from private grazing land;
       ``(E) maintaining and improving wildlife and fish habitat 
     on private grazing land;
       ``(F) enhancing recreational opportunities on private 
     grazing land;
       ``(G) maintaining and improving the aesthetic character of 
     private grazing land;
       ``(H) identifying the opportunities and encouraging the 
     diversification of private grazing land enterprises; and
       ``(I) encouraging the use of sustainable grazing systems, 
     such as year-round, rotational, or managed grazing.
       ``(2) Program elements.--
       ``(A) Funding.--If funding is provided to carry out this 
     section, it shall be provided through a specific line-item in 
     the annual appropriations for the Natural Resources 
     Conservation Service.
       ``(B) Technical assistance and education.--Personnel of the 
     Department trained in pasture and range management shall be 
     made available under the program to deliver and coordinate 
     technical assistance and education to owners and managers of 
     private grazing land, at the request of the owners and 
     managers.
       ``(d) Grazing Technical Assistance Self-Help.--
       ``(1) Findings.--Congress finds that--
       ``(A) there is a severe lack of technical assistance for 
     farmers and ranchers that graze livestock;
       ``(B) Federal budgetary constraints preclude any 
     significant expansion, and may force a reduction of, current 
     levels of technical support; and
       ``(C) farmers and ranchers have a history of cooperatively 
     working together to address common needs in the promotion of 
     their products and in the drainage of wet areas through 
     drainage districts.
       ``(2) Establishment of grazing demonstration.--In 
     accordance with paragraph (3), the Secretary may establish 2 
     grazing management demonstration districts at the 
     recommendation of the grazing land conservation initiative 
     steering committee.
       ``(3) Procedure.--
       ``(A) Proposal.--Within a reasonable time after the 
     submission of a request of an organization of farmers or 
     ranchers engaged in grazing, the Secretary shall propose that 
     a grazing management district be established.
       ``(B) Funding.--The terms and conditions of the funding and 
     operation of the grazing management district shall be 
     proposed by the producers.
       ``(C) Approval.--The Secretary shall approve the proposal 
     if the Secretary determines that the proposal--
       ``(i) is reasonable;
       ``(ii) will promote sound grazing practices; and
       ``(iii) contains provisions similar to the provisions 
     contained in the beef promotion and research order issued 
     under section 4 of the Beef Research and Information Act (7 
     U.S.C. 2903) in effect on April 4, 1996.
       ``(D) Area included.--The area proposed to be included in a 
     grazing management district shall be determined by the 
     Secretary on the basis of an application by farmers or 
     ranchers.
       ``(E) Authorization.--The Secretary may use authority under 
     the Agricultural Adjustment Act (7 U.S.C. 601 et seq.), 
     reenacted with amendments by the Agricultural Marketing 
     Agreement Act of 1937, to operate, on a demonstration basis, 
     a grazing management district.
       ``(F) Activities.--The activities of a grazing management 
     district shall be scientifically sound activities, as 
     determined by the Secretary in consultation with a technical 
     advisory committee composed of ranchers, farmers, and 
     technical experts.
       ``(e) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $60,000,000 for 
     each of fiscal years 2002 through 2007.

     ``SEC. 1240N. WILDLIFE HABITAT INCENTIVE PROGRAM.

       ``(a) In General.--The Secretary, in consultation with the 
     State technical committees established under section 1261, 
     shall establish within the Natural Resources Conservation 
     Service a program to be known as the wildlife habitat 
     incentive program (referred to in this section as the 
     `program').
       ``(b) Cost-Share Payments.--

[[Page H1831]]

       ``(1) In general.--Under the program, the Secretary shall 
     make cost-share payments to landowners to develop--
       ``(A) upland wildlife habitat;
       ``(B) wetland wildlife habitat;
       ``(C) habitat for threatened and endangered species;
       ``(D) fish habitat; and
       ``(E) other types of wildlife habitat approved by the 
     Secretary.
       ``(2) Increased cost share for long-term agreements.--
       ``(A) In general.--In a case in which the Secretary enters 
     into an agreement or contract to protect and restore plant 
     and animal habitat that has a term of at least 15 years, the 
     Secretary may provide cost-share payments in addition to 
     amounts provided under paragraph (1).
       ``(B) Funding limitation.--The Secretary may use, for a 
     fiscal year, not more than 15 percent of funds made available 
     under section 1241(a)(7) for the fiscal year to carry out 
     contracts and agreements described in subparagraph (A).
       ``(c) Regional Equity.--In carrying out this section, the 
     Secretary shall, to the maximum extent practicable, ensure 
     that regional issues of concern relating to wildlife habitat 
     are addressed in an appropriate manner.

     ``SEC. 1240O. GRASSROOTS SOURCE WATER PROTECTION PROGRAM.

       ``(a) In General.--The Secretary shall establish a national 
     grassroots water protection program to more effectively use 
     onsite technical assistance capabilities of each State rural 
     water association that, as of the date of enactment of this 
     section, operates a wellhead or groundwater protection 
     program in the State.
       ``(b) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $5,000,000 for 
     each of fiscal years 2002 through 2007.

     ``SEC. 1240P. GREAT LAKES BASIN PROGRAM FOR SOIL EROSION AND 
                   SEDIMENT CONTROL.

       ``(a) In General.--The Secretary, in consultation with the 
     Great Lakes Commission created by Article IV of the Great 
     Lakes Basin Compact (82 Stat. 415) and in cooperation with 
     the Administrator of the Environmental Protection Agency and 
     the Secretary of the Army, may carry out the Great Lakes 
     basin program for soil erosion and sediment control (referred 
     to in this section as the `program').
       ``(b) Assistance.--In carrying out the program, the 
     Secretary may--
       ``(1) provide project demonstration grants, provide 
     technical assistance, and carry out information and education 
     programs to improve water quality in the Great Lakes basin by 
     reducing soil erosion and improving sediment control; and
       ``(2) provide a priority for projects and activities that 
     directly reduce soil erosion or improve sediment control.
       ``(c) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $5,000,000 for 
     each of fiscal years 2002 through 2007.''.
       (b) Conforming Amendment.--Sections 386 and 387 of the 
     Federal Agriculture Improvement and Reform Act of 1996 (16 
     U.S.C. 2005b, 3836a) are repealed.

     SEC. 2503. FARMLAND PROTECTION PROGRAM.

       (a) In General.--Chapter 2 of the Food Security Act of 1985 
     (as amended by section 2001) is amended by adding at the end 
     the following:

              ``Subchapter B--Farmland Protection Program

     ``SEC. 1238H. DEFINITIONS.

       ``In this subchapter:
       ``(1) Eligible entity.--The term `eligible entity' means--
       ``(A) any agency of any State or local government or an 
     Indian tribe (including a farmland protection board or land 
     resource council established under State law); or
       ``(B) any organization that--
       ``(i) is organized for, and at all times since the 
     formation of the organization has been operated principally 
     for, 1 or more of the conservation purposes specified in 
     clause (i), (ii), (iii), or (iv) of section 170(h)(4)(A) of 
     the Internal Revenue Code of 1986;
       ``(ii) is an organization described in section 501(c)(3) of 
     that Code that is exempt from taxation under section 501(a) 
     of that Code;
       ``(iii) is described in section 509(a)(2) of that Code; or
       ``(iv) is described in section 509(a)(3), and is controlled 
     by an organization described in section 509(a)(2), of that 
     Code.
       ``(2) Eligible land.--
       ``(A) In general.--The term `eligible land' means land on a 
     farm or ranch that--
       ``(i)(I) has prime, unique, or other productive soil; or
       ``(II) contains historical or archaeological resources; and
       ``(ii) is subject to a pending offer for purchase from an 
     eligible entity.
       ``(B) Inclusions.--The term `eligible land' includes, on a 
     farm or ranch--
       ``(i) cropland;
       ``(ii) rangeland;
       ``(iii) grassland;
       ``(iv) pasture land; and
       ``(v) forest land that is an incidental part of an 
     agricultural operation, as determined by the Secretary.
       ``(3) Indian tribe.--The term `Indian tribe' has the 
     meaning given the term in section 4 of the Indian Self-
     Determination and Education Assistance Act (25 U.S.C. 450b).
       ``(4) Program.--The term `program' means the farmland 
     protection program established under section 1238I(a).

     ``SEC. 1238I. FARMLAND PROTECTION.

       ``(a) In General.--The Secretary, acting through the 
     Natural Resources Conservation Service, shall establish and 
     carry out a farmland protection program under which the 
     Secretary shall purchase conservation easements or other 
     interests in eligible land that is subject to a pending offer 
     from an eligible entity for the purpose of protecting topsoil 
     by limiting nonagricultural uses of the land.
       ``(b) Conservation Plan.--Any highly erodible cropland for 
     which a conservation easement or other interest is purchased 
     under this subchapter shall be subject to the requirements of 
     a conservation plan that requires, at the option of the 
     Secretary, the conversion of the cropland to less intensive 
     uses.
       ``(c) Cost Sharing.--
       ``(1) Farmland protection.--
       ``(A) Share provided under this subsection.--The share of 
     the cost of purchasing a conservation easement or other 
     interest in eligible land described in subsection (a) 
     provided under section 1241(d) shall not exceed 50 percent of 
     the appraised fair market value of the conservation easement 
     or other interest in eligible land.
       ``(B) Share not provided under this subsection.--As part of 
     the share of the cost of purchasing a conservation easement 
     or other interest in eligible land described in subsection 
     (a) that is not provided under section 1241(d), an eligible 
     entity may include a charitable donation by the private 
     landowner from which the eligible land is to be purchased of 
     not more than 25 percent of the fair market value of the 
     conservation easement or other interest in eligible land.
       ``(2) Bidding down.--If the Secretary determines that 2 or 
     more applications for the purchase of a conservation easement 
     or other interest in eligible land described in subsection 
     (a) are comparable in achieving the purposes of this section, 
     the Secretary shall not assign a higher priority to any 1 of 
     those applications solely on the basis of lesser cost to the 
     farmland protection program established under subsection (a).

     ``SEC. 1238J. FARM VIABILITY PROGRAM.

       ``(a) In General.--The Secretary may provide to eligible 
     entities identified by the Secretary grants for use in 
     carrying out farm viability programs developed by the 
     eligible entities and approved by the Secretary.
       ``(b) Authorization of Appropriations.--There are 
     authorized to be appropriated to the Secretary to carry out 
     this section such sums as are necessary for each of fiscal 
     years 2002 through 2007.''.
       (b) Conforming Amendments.--
       (1) In general.--
       (A) Section 388 of the Federal Agriculture Improvement and 
     Reform Act of 1996 (16 U.S.C. 3830 note; Public Law 104-127) 
     is repealed.
       (B) Section 211 of the Agriculture Risk Protection Act of 
     2000 (16 U.S.C. 3830 note; Public Law 106-224) is amended--
       (i) by striking subsection (a); and
       (ii) in subsection (b)--

       (I) by striking the subsection designation and the 
     subsection heading;
       (II) by redesignating paragraphs (1), (2), and (3) as 
     subsections (a), (b), and (c), respectively, and indenting 
     appropriately;
       (III) in subsection (a) (as so redesignated), by 
     redesignating subparagraphs (A), (B), and (C) as paragraphs 
     (1), (2), and (3), respectively, and indenting appropriately;
       (IV) in subsection (b) (as so redesignated), by striking 
     ``assistance'' and inserting ``Assistance''; and
       (V) by striking ``subsection'' each place it appears and 
     inserting ``section''.

       (2) Effect on contracts.--The amendment made by paragraph 
     (1)(A) shall have no effect on any contract entered into 
     under section 388 of the Federal Agriculture Improvement and 
     Reform Act of 1996 (16 U.S.C. 3830 note) that is in effect as 
     of the date of enactment of this Act.

     SEC. 2504. RESOURCE CONSERVATION AND DEVELOPMENT PROGRAM.

       Subtitle H of title XV of the Agriculture and Food Act of 
     1981 (16 U.S.C. 3451 et seq.) is amended to read as follows:
      ``Subtitle H--Resource Conservation and Development Program

     ``SEC. 1528. DEFINITIONS.

       ``In this subtitle:
       ``(1) Area plan.--The term `area plan' means a resource 
     conservation and use plan developed through a planning 
     process by a council for a designated area of 1 or more 
     States, or of land under the jurisdiction of an Indian tribe, 
     that includes 1 or more of the following elements:
       ``(A) A land conservation element, the purpose of which is 
     to control erosion and sedimentation.
       ``(B) A water management element that provides 1 or more 
     clear environmental or conservation benefits, the purpose of 
     which is to provide for--
       ``(i) the conservation, use, and quality of water, 
     including irrigation and rural water supplies;
       ``(ii) the mitigation of floods and high water tables;
       ``(iii) the repair and improvement of reservoirs;
       ``(iv) the improvement of agricultural water management; 
     and
       ``(v) the improvement of water quality.
       ``(C) A community development element, the purpose of which 
     is to improve--
       ``(i) the development of resources-based industries;
       ``(ii) the protection of rural industries from natural 
     resource hazards;
       ``(iii) the development of adequate rural water and waste 
     disposal systems;
       ``(iv) the improvement of recreation facilities;
       ``(v) the improvement in the quality of rural housing;
       ``(vi) the provision of adequate health and education 
     facilities;
       ``(vii) the satisfaction of essential transportation and 
     communication needs; and
       ``(viii) the promotion of food security, economic 
     development, and education.

[[Page H1832]]

       ``(D) A land management element, the purpose of which is--
       ``(i) energy conservation, including the production of 
     energy crops;
       ``(ii) the protection of agricultural land, as appropriate, 
     from conversion to other uses;
       ``(iii) farmland protection; and
       ``(iv) the protection of fish and wildlife habitats.
       ``(2) Board.--The term `Board' means the Resource 
     Conservation and Development Policy Advisory Board 
     established under section 1533(a).
       ``(3) Council.--The term `council' means a nonprofit entity 
     (including an affiliate of the entity) operating in a State 
     that is--
       ``(A) established by volunteers or representatives of 
     States, local units of government, Indian tribes, or local 
     nonprofit organizations to carry out an area plan in a 
     designated area; and
       ``(B) designated by the chief executive officer or 
     legislature of the State to receive technical assistance and 
     financial assistance under this subtitle.
       ``(4) Designated area.--The term `designated area' means a 
     geographic area designated by the Secretary to receive 
     technical assistance and financial assistance under this 
     subtitle.
       ``(5) Financial assistance.--The term `financial 
     assistance' means a grant or loan provided by the Secretary 
     (or the Secretary and other Federal agencies) to, or a 
     cooperative agreement entered into by the Secretary (or the 
     Secretary and other Federal agencies) with, a council, or 
     association of councils, to carry out an area plan in a 
     designated area, including assistance provided for planning, 
     analysis, feasibility studies, training, education, and other 
     activities necessary to carry out the area plan.
       ``(6) Indian tribe.--The term `Indian tribe' has the 
     meaning given the term in section 4 of the Indian Self-
     Determination and Education Assistance Act (25 U.S.C. 450b).
       ``(7) Local unit of government.--The term `local unit of 
     government' means--
       ``(A) any county, city, town, township, parish, village, or 
     other general-purpose subdivision of a State; and
       ``(B) any local or regional special district or other 
     limited political subdivision of a State, including any soil 
     conservation district, school district, park authority, and 
     water or sanitary district.
       ``(8) Nonprofit organization.--The term `nonprofit 
     organization' means any organization that is--
       ``(A) described in section 501(c) of the Internal Revenue 
     Code of 1986; and
       ``(B) exempt from taxation under section 501(a) of the 
     Internal Revenue Code of 1986.
       ``(9) Planning process.--The term `planning process' means 
     actions taken by a council to develop and carry out an 
     effective area plan in a designated area, including 
     development of the area plan, goals, purposes, policies, 
     implementation activities, evaluations and reviews, and the 
     opportunity for public participation in the actions.
       ``(10) Project.--The term `project' means a project that is 
     carried out by a council to achieve any of the elements of an 
     area plan.
       ``(11) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture.
       ``(12) State.--The term `State' means--
       ``(A) any State;
       ``(B) the District of Columbia; or
       ``(C) any territory or possession of the United States.
       ``(13) Technical assistance.--The term `technical 
     assistance' means any service provided by the Secretary or 
     agent of the Secretary, including--
       ``(A) inventorying, evaluating, planning, designing, 
     supervising, laying out, and inspecting projects;
       ``(B) providing maps, reports, and other documents 
     associated with the services provided;
       ``(C) providing assistance for the long-term implementation 
     of area plans; and
       ``(D) providing services of an agency of the Department of 
     Agriculture to assist councils in developing and carrying out 
     area plans.

     ``SEC. 1529. RESOURCE CONSERVATION AND DEVELOPMENT PROGRAM.

       ``The Secretary shall establish a resource conservation and 
     development program under which the Secretary shall provide 
     technical assistance and financial assistance to councils to 
     develop and carry out area plans and projects in designated 
     areas--
       ``(1) to conserve and improve the use of land, develop 
     natural resources, and improve and enhance the social, 
     economic, and environmental conditions in primarily rural 
     areas of the United States; and
       ``(2) to encourage and improve the capability of State, 
     units of government, Indian tribes, nonprofit organizations, 
     and councils to carry out the purposes described in paragraph 
     (1).

     ``SEC. 1530. SELECTION OF DESIGNATED AREAS.

       ``The Secretary shall select designated areas for 
     assistance under this subtitle on the basis of the elements 
     of area plans.

     ``SEC. 1531. POWERS OF THE SECRETARY.

       ``In carrying out this subtitle, the Secretary may--
       ``(1) provide technical assistance to any council to assist 
     in developing and implementing an area plan for a designated 
     area;
       ``(2) cooperate with other departments and agencies of the 
     Federal Government, States, local units of government, local 
     Indian tribes, and local nonprofit organizations in 
     conducting surveys and inventories, disseminating 
     information, and developing area plans;
       ``(3) assist in carrying out an area plan approved by the 
     Secretary for any designated area by providing technical 
     assistance and financial assistance to any council; and
       ``(4) enter into agreements with councils in accordance 
     with section 1532.

     ``SEC. 1532. ELIGIBILITY; TERMS AND CONDITIONS.

       ``(a) Eligibility.--Technical assistance and financial 
     assistance may be provided by the Secretary under this 
     subtitle to any council to assist in carrying out a project 
     specified in an area plan approved by the Secretary only if--
       ``(1) the council agrees in writing--
       ``(A) to carry out the project; and
       ``(B) to finance or arrange for financing of any portion of 
     the cost of carrying out the project for which financial 
     assistance is not provided by the Secretary under this 
     subtitle;
       ``(2) the project is included in an area plan and is 
     approved by the council;
       ``(3) the Secretary determines that assistance is necessary 
     to carry out the area plan;
       ``(4) the project provided for in the area plan is 
     consistent with any comprehensive plan for the area;
       ``(5) the cost of the land or an interest in the land 
     acquired or to be acquired under the plan by any State, local 
     unit of government, Indian tribe, or local nonprofit 
     organization is borne by the State, local unit of government, 
     Indian tribe, or local nonprofit organization, respectively; 
     and
       ``(6) the State, local unit of government, Indian tribe, or 
     local nonprofit organization participating in the area plan 
     agrees to maintain and operate the project.
       ``(b) Loans.--
       ``(1) In general.--Subject to paragraphs (2) and (3), a 
     loan made under this subtitle shall be made on such terms and 
     conditions as the Secretary may prescribe.
       ``(2) Term.--A loan for a project made under this subtitle 
     shall have a term of not more than 30 years after the date of 
     completion of the project.
       ``(3) Interest rate.--A loan made under this subtitle shall 
     bear interest at the average rate of interest paid by the 
     United States on obligations of a comparable term, as 
     determined by the Secretary of the Treasury.
       ``(c) Approval by Secretary.--Technical assistance and 
     financial assistance under this subtitle may not be made 
     available to a council to carry out an area plan unless the 
     area plan has been submitted to and approved by the 
     Secretary.
       ``(d) Withdrawal.--The Secretary may withdraw technical 
     assistance and financial assistance with respect to any area 
     plan if the Secretary determines that the assistance is no 
     longer necessary or that sufficient progress has not been 
     made toward developing or implementing the elements of the 
     area plan.

     ``SEC. 1533. RESOURCE CONSERVATION AND DEVELOPMENT POLICY 
                   ADVISORY BOARD.

       ``(a) Establishment.--The Secretary shall establish within 
     the Department of Agriculture a Resource Conservation and 
     Development Policy Advisory Board.
       ``(b) Composition.--
       ``(1) In general.--The Board shall be composed of at least 
     7 employees of the Department of Agriculture selected by the 
     Secretary.
       ``(2) Chairperson.--A member of the Board shall be 
     designated by the Secretary to serve as chairperson of the 
     Board.
       ``(c) Duties.--The Board shall advise the Secretary 
     regarding the administration of this subtitle, including the 
     formulation of policies for carrying out this subtitle.

     ``SEC. 1534. EVALUATION OF PROGRAM.

       ``(a) In General.--The Secretary, in consultation with 
     councils, shall evaluate the program established under this 
     subtitle to determine whether the program is effectively 
     meeting the needs of, and the purposes identified by, States, 
     units of government, Indian tribes, nonprofit organizations, 
     and councils participating in, or served by, the program.
       ``(b) Report.--Not later than June 30, 2005, the Secretary 
     shall submit to the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate a report describing the results of 
     the evaluation, together with any recommendations of the 
     Secretary for continuing, terminating, or modifying the 
     program.

     ``SEC. 1535. LIMITATION ON ASSISTANCE.

       ``In carrying out this subtitle, the Secretary shall 
     provide technical assistance and financial assistance with 
     respect to not more than 450 active designated areas.

     ``SEC. 1536. SUPPLEMENTAL AUTHORITY OF THE SECRETARY.

       ``The authority of the Secretary under this subtitle to 
     assist councils in the development and implementation of area 
     plans shall be supplemental to, and not in lieu of, any 
     authority of the Secretary under any other provision of law.

     ``SEC. 1537. AUTHORIZATION OF APPROPRIATIONS.

       ``(a) In General.--There are authorized to be such sums as 
     are necessary to carry out this subtitle.
       ``(b) Loans.--The Secretary shall not use more than 
     $15,000,000 of any funds made available for a fiscal year to 
     make loans under this subtitle.
       ``(c) Availability.--Funds appropriated to carry out this 
     subtitle shall remain available until expended.''.

     SEC. 2505. SMALL WATERSHED REHABILITATION PROGRAM.

       Section 14 of the Watershed Protection and Flood Prevention 
     Act (16 U.S.C. 1012) is amended by striking subsection (h) 
     and inserting the following:
       ``(h) Funding.--
       ``(1) Funds of commodity credit corporation.--In carrying 
     out this section, of the funds of the Commodity Credit 
     Corporation, the Secretary shall make available, to remain 
     available until expended--
       ``(A) $45,000,000 for fiscal year 2003;
       ``(B) $50,000,000 for fiscal year 2004;
       ``(C) $55,000,000 for fiscal year 2005;

[[Page H1833]]

       ``(D) $60,000,000 for fiscal year 2006;
       ``(E) $65,000,000 for fiscal year 2007; and
       ``(F) $0 for fiscal year 2008.
       ``(2) Authorization of appropriations.--In addition to 
     amounts made available under paragraph (1), there are 
     authorized to be appropriated to the Secretary to carry out 
     this section, to remain available until expended--
       ``(A) $45,000,000 for fiscal year 2003;
       ``(B) $55,000,000 for fiscal year 2004;
       ``(C) $65,000,000 for fiscal year 2005;
       ``(D) $75,000,000 for fiscal year 2006; and
       ``(E) $85,000,000 for fiscal year 2007.''.

     SEC. 2506. USE OF SYMBOLS, SLOGANS, AND LOGOS.

       Section 356 of the Federal Agriculture Improvement Act of 
     1996 (16 U.S.C. 5801 et seq.) is amended--
       (1) in subsection (c)--
       (A) by redesignating paragraphs (4) through (7) as 
     paragraphs (5) through (8), respectively; and
       (B) by inserting after paragraph (3) the following:
       ``(4) on the written approval of the Secretary, to use, 
     license, or transfer symbols, slogans, and logos of the 
     Foundation (exclusive of any symbol or logo of a governmental 
     entity);''; and
       (2) in subsection (d), by adding at the end the following:
       ``(3) Use of symbols, slogans, and logos of the 
     foundation.--
       ``(A) In general.--The Secretary may authorize the 
     Foundation to use, license, or transfer symbols, slogans, and 
     logos of the Foundation.
       ``(B) Income.--
       ``(i) In general.--All revenue received by the Foundation 
     from the use, licensing, or transfer of symbols, slogans, and 
     logos of the Foundation shall be transferred to the 
     Secretary.
       ``(ii) Conservation operations.--The Secretary shall 
     transfer all revenue received under clause (i) to the account 
     within the Natural Resources Conservation Service that is 
     used to carry out conservation operations.''.

     SEC. 2507. DESERT TERMINAL LAKES.

       ``(a) In General.--Subject to subsection (b), as soon as 
     practicable after the date of enactment of this Act, the 
     Secretary of Agriculture shall transfer $200,000,000 of the 
     funds of the Commodity Credit Corporation to the Bureau of 
     Reclamation Water and Related Resources Account, which funds 
     shall--
       ``(1) be used by the Secretary of the Interior, acting 
     through the Commissioner of Reclamation, to provide water to 
     at-risk natural desert terminal lakes; and
       ``(2) remain available until expended.
       ``(b) Limitation.--The funds described in subsection (a) 
     shall not be used to purchase or lease water rights.
        Subtitle G--Conservation Corridor Demonstration Program

     SEC. 2601. DEFINITIONS.

       In this subtitle:
       (1) Delmarva peninsula.--The term ``Delmarva Peninsula'' 
     means land in the States of Delaware, Maryland, and Virginia 
     located on the east side of the Chesapeake Bay.
       (2) Demonstration program.--The term ``demonstration 
     program'' means the Conservation Corridor Demonstration 
     Program established under this subtitle.
       (3) Conservation corridor plan; plan.--The terms 
     ``conservation corridor plan'' and ``plan'' mean a 
     conservation corridor plan required to be submitted and 
     approved as a condition for participation in the 
     demonstration program.
       (4) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.

     SEC. 2602. CONSERVATION CORRIDOR DEMONSTRATION PROGRAM.

       (a) Establishment.--The Secretary shall carry out a 
     demonstration program, to be known as the ``Conservation 
     Corridor Demonstration Program'', under which any of the 
     States of Delaware, Maryland, and Virginia, a local 
     government of any 1 of those States with jurisdiction over 
     land on the Delmarva Peninsula, or a combination of those 
     States, may submit a conservation corridor plan to integrate 
     agriculture and forestry conservation programs of the 
     Department of Agriculture with State and local efforts to 
     address farm conservation needs.
       (b) Submission of Conservation Corridor Plan.--
       (1) Submission and proposal.--To be eligible to participate 
     in the demonstration program, a State, local government, or 
     combination of States referred to in subsection (a) shall--
       (A) submit to the Secretary a conservation corridor plan 
     that--
       (i) proposes specific criteria and commitment of resources 
     in the geographic region designated in the plan; and
       (ii) describes how the linkage of Federal, State, and local 
     resources will improve--

       (I) the economic viability of agriculture; and
       (II) the environmental integrity of the watersheds in the 
     Delmarva Peninsula; and

       (B) demonstrate to the Secretary that, in developing the 
     plan, the State, local government, or combination of States 
     has solicited and taken into account the views of local 
     residents.
       (2) Draft memorandum of agreement.--If the conservation 
     corridor plan is submitted by more than 1 State, the plan 
     shall provide a draft memorandum of agreement among entities 
     in each submitting State.
       (c) Review of Plan.--Not later than 90 days after the date 
     of receipt of a conservation corridor plan, the Secretary--
       (1) shall review the plan; and
       (2) may approve the plan for implementation under this 
     subtitle if the Secretary determines that the plan meets the 
     requirements specified in subsection (d).
       (d) Criteria for Approval.--The Secretary may approve a 
     conservation corridor plan only if, as determined by the 
     Secretary, the plan provides for each of the following:
       (1) Voluntary actions.--Actions taken under the plan--
       (A) are voluntary;
       (B) require the consent of willing landowners; and
       (C) provide a mechanism by which the landowner may withdraw 
     such consent without adverse consequences other than the loss 
     of any payments to the landowner conditioned on continued 
     enrollment of the land.
       (2) Land of high conservation value.--Criteria specified in 
     the plan ensure that land enrolled in each conservation 
     program incorporated through the plan are of exceptionally 
     high conservation value, as determined by the Secretary.
       (3) No effect on unenrolled land.--The enrollment of land 
     in a conservation program incorporated through the plan will 
     neither--
       (A) adversely affect any adjacent land not so enrolled; nor
       (B) create any buffer zone on such unenrolled land.
       (4) Greater benefits.--The conservation programs 
     incorporated through the plan provide benefits greater than 
     the benefits that would likely be achieved through individual 
     application of the conservation programs.
       (5) Sufficient staffing.--Staffing, considering both 
     Federal and non-Federal resources, is sufficient to ensure 
     success of the plan.

     SEC. 2603. IMPLEMENTATION OF CONSERVATION CORRIDOR PLAN.

       (a) Memorandum of Agreement.--On approval of a conservation 
     corridor plan, the Secretary may enter into a memorandum of 
     agreement with the State, local government, or combination of 
     States that submitted the plan to--
       (1) guarantee specific program resources for implementation 
     of the plan;
       (2) establish various compensation rates to the extent that 
     the parties to the agreement consider justified; and
       (3) provide streamlined and integrated paperwork 
     requirements.
       (b) Continued Compliance With Plan Approval Criteria.--The 
     Secretary shall terminate the memorandum of agreement entered 
     into under subsection (a) with respect to an approved 
     conservation corridor plan and cease the provision of 
     resources for implementation of the plan if the Secretary 
     determines that, in the implementation of the plan--
       (1) the State, local government, or combination of States 
     that submitted the plan has deviated from--
       (A) the plan;
       (B) the criteria specified in section 2602(d) on which 
     approval of the plan was conditioned; or
       (C) the cost-sharing requirements of section 2604(a) or any 
     other condition of the plan; or
       (2) the economic viability of agriculture in the geographic 
     region designated in the plan is being hindered.
       (c) Progress Report.--At the end of the 3-year period that 
     begins on the date on which funds are first provided with 
     respect to a conservation corridor plan under the 
     demonstration program, the State, local government, or 
     combination of States that submitted the plan shall submit to 
     the Secretary--
       (1) a report on the effectiveness of the activities carried 
     out under the plan; and
       (2) an evaluation of the economic viability of agriculture 
     in the geographic region designated in the plan.
       (d) Duration.--The demonstration program shall be carried 
     out for not less than 3 nor more than 5 years beginning on 
     the date on which funds are first provided under the 
     demonstration program.

     SEC. 2604. FUNDING REQUIREMENTS.

       (a) Cost Sharing.--
       (1) Required non-federal share.--Subject to paragraph (2), 
     as a condition on the approval of a conservation corridor 
     plan, the Secretary shall require the State and local 
     participants to contribute financial resources sufficient to 
     cover at least 50 percent of the total cost of the activities 
     carried out under the plan.
       (2) Exception.--The Secretary may reduce the cost-sharing 
     requirement in the case of a specific project or activity 
     under the demonstration program on good cause and on 
     demonstration that the project or activity is likely to 
     achieve extraordinary natural resource benefits.
       (b) Reservation of Funds.--The Secretary may consider 
     directing funds on a priority basis to the demonstration 
     program and to projects in areas identified by the plan.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this subtitle for each of fiscal years 2002 through 2007.
                 Subtitle H--Funding and Administration

     SEC. 2701. FUNDING AND ADMINISTRATION.

       Subtitle E of the Food Security Act of 1985 is amended by 
     striking sections 1241 and 1242 (16 U.S.C. 3841, 3842) and 
     inserting the following:

     ``SEC. 1241. COMMODITY CREDIT CORPORATION.

       ``(a) In General.--For each of fiscal years 2002 through 
     2007, the Secretary shall use the funds, facilities, and 
     authorities of the Commodity Credit Corporation to carry out 
     the following programs under subtitle D (including the 
     provision of technical assistance):
       ``(1) The conservation reserve program under subchapter B 
     of chapter 1.
       ``(2) The wetlands reserve program under subchapter C of 
     chapter 1.
       ``(3) The conservation security program under subchapter A 
     of chapter 2.
       ``(4) The farmland protection program under subchapter B of 
     chapter 2, using, to the maximum extent practicable--
       ``(A) $50,000,000 in fiscal year 2002;
       ``(B) $100,000,000 in fiscal year 2003;
       ``(C) $125,000,000 in each of fiscal years 2004 and 2005;
       ``(D) $100,000,000 in fiscal year 2006; and

[[Page H1834]]

       ``(E) $97,000,000 in fiscal year 2007.
       ``(5) The grassland reserve program under subchapter C of 
     chapter 2, using, to the maximum extent practicable 
     $254,000,000 for the period of fiscal years 2003 through 
     2007.
       ``(6) The environmental quality incentives program under 
     chapter 4, using, to the maximum extent practicable--
       ``(A) $400,000,000 in fiscal year 2002;
       ``(B) $700,000,000 in fiscal year 2003;
       ``(C) $1,000,000,000 in fiscal year 2004;
       ``(D) $1,200,000,000 in each of fiscal years 2005 and 2006; 
     and
       ``(E) $1,300,000,000 in fiscal year 2007.
       ``(7) The wildlife habitat incentives program under section 
     1240N, using, to the maximum extent practicable--
       ``(A) $15,000,000 in fiscal year 2002;
       ``(B) $30,000,000 in fiscal year 2003;
       ``(C) $60,000,000 in fiscal year 2004; and
       ``(D) $85,000,000 in each of fiscal years 2005 through 
     2007.
       ``(b) Section 11.--Nothing in this section affects the 
     limit on expenditures for technical assistance imposed by 
     section 11 of the Commodity Credit Corporation Charter Act 
     (15 U.S.C. 714i).
       ``(c) Regional Equity.--Before April 1 of each fiscal year, 
     the Secretary shall give priority for funding under the 
     conservation programs under subtitle D (excluding the 
     conservation reserve program under subchapter B of chapter 1, 
     the wetlands reserve program under subchapter C of chapter 1, 
     and the conservation security program under subchapter A of 
     chapter 2) to approved applications in any State that has not 
     received, for the fiscal year, an aggregate amount of at 
     least $12,000,000 for those conservation programs.

     ``SEC. 1242. DELIVERY OF TECHNICAL ASSISTANCE.

       ``(a) In General.--The Secretary shall provide technical 
     assistance under this title to a producer eligible for that 
     assistance--
       ``(1) directly; or
       ``(2) at the option of the producer, through a payment, as 
     determined by the Secretary, to the producer for an approved 
     third party, if available.
       ``(b) Certification of Third-Party Providers.--
       ``(1) In general.--Not later than 180 days after the date 
     of enactment of the Farm Security and Rural Investment Act of 
     2002, the Secretary shall, by regulation, establish a system 
     for--
       ``(A) approving individuals and entities to provide 
     technical assistance to carry out programs under this title 
     (including criteria for the evaluation of providers or 
     potential providers of technical assistance); and
       ``(B) establishing the amounts and methods for payments for 
     that assistance.
       ``(2) Expertise.--In promulgating regulations to carry out 
     this subsection the Secretary shall ensure that persons with 
     expertise in the technical aspects of conservation planning, 
     watershed planning, environmental engineering (including 
     commercial entities, nonprofit entities, State or local 
     governments or agencies, and other Federal agencies), are 
     eligible to become approved providers of the technical 
     assistance.
       ``(3) Interim assistance.--
       ``(A) In general.--A person that has provided technical 
     assistance in accordance with an agreement between the person 
     and the Secretary before the date of enactment of the Farm 
     Security and Rural Investment Act of 2002 may continue to 
     provide technical assistance under this section until the 
     date on which the Secretary establishes the system described 
     in paragraph (1).
       ``(B) Evaluation.--If a person described in subparagraph 
     (A) seeks to continue to provide technical assistance after 
     the date referred to in subparagraph (A), the Secretary shall 
     evaluate the person using criteria referred to in paragraph 
     (1).
       ``(4) Non-federal assistance.--The Secretary may request 
     the services of, and enter into cooperative agreements or 
     contracts with, non-Federal entities to assist the Secretary 
     in providing technical assistance necessary to develop and 
     implement conservation programs under this title.''.

     SEC. 2702. REGULATIONS.

       (a) In General.--Except as otherwise provided in this title 
     or an amendment made by this title, not later than 90 days 
     after the date of enactment of this Act, the Secretary of 
     Agriculture, in consultation with the Commodity Credit 
     Corporation, shall promulgate such regulations as are 
     necessary to implement this title.
       (b) Applicable Authority.--The promulgation of regulations 
     under subsection (a) and administration of this title--
       (1) shall--
       (A) be carried out without regard to chapter 35 of title 
     44, United States Code (commonly known as the Paperwork 
     Reduction Act); and
       (B) the Statement of Policy of the Secretary of Agriculture 
     effective July 24, 1971 (36 Fed. Reg. 13804) relating to 
     notices of proposed rulemaking and public participation in 
     rulemaking; and
       (2) may--
       (A) be promulgated with an opportunity for notice and 
     comment; or
       (B) if determined to be appropriate by the Secretary of 
     Agriculture or the Commodity Credit Corporation, as an 
     interim rule effective on publication with an opportunity for 
     notice and comment.
       (c) Congressional Review of Agency Rulemaking.--In carrying 
     out this section, the Secretary shall use the authority 
     provided under section 808(2) of title 5, United States Code.
                            TITLE III--TRADE
 Subtitle A--Agricultural Trade Development and Assistance Act of 1954 
                          and Related Statutes

     SEC. 3001. UNITED STATES POLICY.

       Section 2 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1691) is amended--
       (1) in paragraph (4), by striking ``and'' at the end;
       (2) in paragraph (5), by striking the period at the end and 
     inserting ``; and''; and
       (3) by adding at the end the following:
       ``(6) prevent conflicts.''.

     SEC. 3002. PROVISION OF AGRICULTURAL COMMODITIES.

       Section 202 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1722) is amended--
       (1) in subsection (b), by adding at the end the following:
       ``(3) Program diversity.--The Administrator shall--
       ``(A) encourage eligible organizations to propose and 
     implement program plans to address 1 or more aspects of the 
     program under section 201; and
       ``(B) consider proposals that incorporate a variety of 
     program objectives and strategic plans based on the 
     identification by eligible organizations of appropriate 
     activities, consistent with section 201, to assist 
     development of foreign countries.'';
       (2) in subsection (e)(1), by striking ``not less than 
     $10,000,000, and not more than $28,000,000,'' and inserting 
     ``not less than 5 percent nor more than 10 percent of the 
     funds''; and
       (3) by adding at the end the following:
       ``(h) Streamlined Program Management.--
       ``(1) Improvements.--Not later than 1 year after the date 
     of enactment of this subsection, the Administrator shall--
       ``(A) streamline program procedures and guidelines under 
     this title for agreements with eligible organizations for 
     programs in 1 or more countries; and
       ``(B) effective beginning with fiscal year 2004, to the 
     maximum extent practicable, incorporate the changes into the 
     procedures and guidelines for programs and the guidelines for 
     resource requests.
       ``(2) Streamlined procedures and guidelines.--In carrying 
     out paragraph (1), the Administrator shall make improvements 
     in the Office of Food for Peace management systems that 
     include--
       ``(A) expedition of and greater consistency in the program 
     review and approval process under this title;
       ``(B) streamlining of information collection and reporting 
     systems by identifying the critical information that needs to 
     be monitored and reported on by eligible organizations; and
       ``(C) for approved programs, provision of greater 
     flexibility for an eligible organization to make 
     modifications in program activities to achieve program 
     results with streamlined procedures for reporting such 
     modifications.
       ``(3) Consultation.--
       ``(A) In general.--Paragraphs (1) and (2) shall be carried 
     out in accordance with section 205 and subsections (b) and 
     (c) of section 207.
       ``(B) Consultation with congressional committees.--Not 
     later than 180 days after the date of enactment of this 
     subsection, the Administrator shall consult with the 
     Committee on Agriculture and the Committee on International 
     Relations of the House of Representatives and the Committee 
     on Agriculture, Nutrition, and Forestry of the Senate on 
     progress made in carrying out this subsection.
       ``(4) Report.--Not later than 270 days after the date of 
     enactment of this subsection, the Administrator shall submit 
     to the Committee on Agriculture and the Committee on 
     International Relations of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate a report on the improvements made and planned upgrades 
     in the information management, procurement, and financial 
     management systems to administer this title.''.

     SEC. 3003. GENERATION AND USE OF CURRENCIES BY PRIVATE 
                   VOLUNTARY ORGANIZATIONS AND COOPERATIVES.

       Section 203 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1723) is amended--
       (1) in the section heading, by striking ``FOREIGN'';
       (2) in subsection (a), by striking ``the recipient country, 
     or in a country'' and inserting ``1 or more recipient 
     countries, or 1 or more countries'';
       (3) in subsection (b)--
       (A) by striking ``in recipient countries, or in countries'' 
     and inserting ``1 or more recipient countries, or in 1 or 
     more countries''; and
       (B) by striking ``foreign currency'';
       (4) in subsection (c)--
       (A) by striking ``foreign currency''; and
       (B) by striking ``the recipient country, or in a country'' 
     and inserting ``1 or more recipient countries, or in 1 or 
     more countries''; and
       (5) in subsection (d)--
       (A) by striking ``Foreign currencies'' and inserting 
     ``Proceeds'';
       (B) in paragraph (2)--
       (i) by striking ``income generating'' and inserting 
     ``income-generating''; and
       (ii) by striking ``the recipient country or within a 
     country'' and inserting ``1 or more recipient countries or 
     within 1 or more countries''; and
       (C) in paragraph (3)--
       (i) by inserting a comma after ``invested''; and
       (ii) by inserting a comma after ``used''.

     SEC. 3004. LEVELS OF ASSISTANCE.

       Section 204(a) of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1724(a)) is amended--
       (1) by striking ``1996 through 2002'' each place it appears 
     and inserting ``2002 through 2007'';
       (2) in paragraph (1), by striking ``2,025,000'' and 
     inserting ``2,500,000''; and
       (3) in paragraph (2), by striking ``1,550,000 metric tons'' 
     and inserting ``1,875,000 metric tons''.

     SEC. 3005. FOOD AID CONSULTATIVE GROUP.

       Section 205(f) of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C.

[[Page H1835]]

     1725(f)) is amended by striking ``2002'' and inserting 
     ``2007''.

     SEC. 3006. MAXIMUM LEVEL OF EXPENDITURES.

       Section 206 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1726) is repealed.

     SEC. 3007. ADMINISTRATION.

       Section 207 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1726a) is amended--
       (1) in subsection (a)--
       (A) by redesignating paragraph (2) as paragraph (3); and
       (B) by striking paragraph (1) and inserting the following:
       ``(1) Recipient countries.--A proposal to enter into a 
     nonemergency food assistance agreement under this title shall 
     identify the recipient country or countries that are the 
     subject of the agreement.
       ``(2) Timing.--Not later than 120 days after the date of 
     receipt by the Administrator of a proposal submitted by an 
     eligible organization under this title, the Administrator 
     shall determine whether to accept the proposal.'';
       (2) in subsection (b), by striking ``guideline'' each place 
     it appears and inserting ``guideline or annual policy 
     guidance''; and
       (3) by adding at the end the following:
       ``(e) Timely Approval.--
       ``(1) In general.--The Administrator is encouraged to 
     finalize program agreements and resource requests for 
     programs under this section before the beginning of each 
     fiscal year.
       ``(2) Report.--Not later than December 1 of each year, the 
     Administrator shall submit to the Committee on Agriculture 
     and the Committee on International Relations of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate a report that contains--
       ``(A) a list of programs, countries, and commodities 
     approved to date for assistance under this section; and
       ``(B) a statement of the total amount of funds approved to 
     date for transportation and administrative costs under this 
     section.''.

     SEC. 3008. ASSISTANCE FOR STOCKPILING AND RAPID 
                   TRANSPORTATION, DELIVERY, AND DISTRIBUTION OF 
                   SHELF-STABLE PREPACKAGED FOODS.

       Section 208(f) of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1726b(f)) is amended by 
     striking ``and 2002'' and inserting ``through 2007''.

     SEC. 3009. SALE PROCEDURE.

       (a) In General.--Section 403 of the Agricultural Trade 
     Development and Assistance Act of 1954 (7 U.S.C. 1733) is 
     amended--
       (1) in subsection (e)--
       (A) by striking ``In carrying'' and inserting the 
     following:
       ``(1) In general.--In carrying''; and
       (B) by adding at the end the following:
       ``(2) Sale price.--Sales of agricultural commodities 
     described in paragraph (1) shall be made at a reasonable 
     market price in the economy where the agricultural commodity 
     is to be sold, as determined by the Secretary or the 
     Administrator, as appropriate.''; and
       (2) by adding at the end the following:
       ``(l) Sale Procedure.--
       ``(1) In general.--Subsections (b) and (h) shall apply to 
     sales of commodities in recipient countries to generate 
     proceeds to carry out projects under--
       ``(A) titles I and II;
       ``(B) section 416(b) of the Agricultural Act of 1949 (7 
     U.S.C. 1431(b)); and
       ``(C) the Food for Progress Act of 1985 (7 U.S.C. 1736o).
       ``(2) Currency.--A sale described in paragraph (1) may be 
     made in United States dollars or other currencies.''.
       (b) Conforming Amendments.--
       (1) Section 416(b) of the Agricultural Act of 1949 (7 
     U.S.C. 1431(b)) is amended by adding at the end the 
     following:
       ``(10) Sale procedure.--In approving sales of commodities 
     under this subsection, the Secretary shall follow the sale 
     procedure described in section 403(l) of the Agricultural 
     Trade Development and Assistance Act of 1954.''.
       (2) Subsection (f) of the Food for Progress Act of 1985 (7 
     U.S.C. 1736o(f)) is amended by adding at the end the 
     following:
       ``(5) Sale procedure.--In making sales of eligible 
     commodities under this section, the Secretary shall follow 
     the sale procedure described in section 403(l) of the 
     Agricultural Trade Development and Assistance Act of 1954.''.

     SEC. 3010. PREPOSITIONING.

       Section 407(c)(4) of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1736a(c)(4)) is amended by 
     striking ``and 2002'' and inserting ``through 2007''.

     SEC. 3011. TRANSPORTATION AND RELATED COSTS.

       Section 407(c)(1) of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1736a(c)(1)) is amended--
       (1) by striking ``The Administrator'' and inserting the 
     following:
       ``(A) In general.--The Administrator''; and
       (2) by adding at the end the following:
       ``(B) Certain commodities made available for nonemergency 
     assistance.--In the case of agricultural commodities made 
     available for nonemergency assistance under title II for 
     least developed countries that meet the poverty and other 
     eligibility criteria established by the International Bank 
     for Reconstruction and Development for financing under the 
     International Development Association, the Administrator may 
     pay the transportation costs incurred in moving the 
     agricultural commodities from designated points of entry or 
     ports of entry abroad to storage and distribution sites and 
     associated storage and distribution costs.''.

     SEC. 3012. EXPIRATION DATE.

       Section 408 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1736b) is amended by 
     striking ``2002'' and inserting ``2007''.

     SEC. 3013. MICRONUTRIENT FORTIFICATION PROGRAMS.

       Section 415 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1736g-2) is amended--
       (1) in the section heading, by striking ``PILOT PROGRAM.'' 
     and inserting ``PROGRAMS.'';
       (2) in subsection (a)--
       (A) by redesignating paragraphs (1) and (2) as 
     subparagraphs (A) and (B), respectively, and adjusting the 
     margins appropriately;
       (B) by striking the first sentence and inserting the 
     following:
       ``(1) Programs.--Not later than September 30, 2003, the 
     Administrator, in consultation with the Secretary, shall 
     establish micronutrient fortification programs.''; and
       (C) in the second sentence, by striking ``The purpose of 
     the program'' and inserting the following:
       ``(2) Purpose.--The purpose of a program''; and
       (D) in paragraph (2) (as designated by subparagraph (C))--
       (i) in subparagraph (A), by striking ``and'' at the end;
       (ii) in subparagraph (B)--

       (I) by striking ``whole''; and
       (II) by striking the period at the end and inserting ``; 
     and''; and

       (iii) by adding at the end the following:
       ``(C) assess and apply technologies and systems to improve 
     and ensure the quality, shelf life, bioavailability, and 
     safety of fortified food aid commodities, and products of 
     those commodities, that are provided to developing countries, 
     by using the same mechanism that was used to assess the 
     micronutrient fortification program in the report entitled 
     `Micronutrient Compliance Review of Fortified P.L. 480 
     Commodities', published October 2001 with funds from the 
     Bureau for Humanitarian Response of the United States Agency 
     for International Development.'';
       (3) in subsection (b), by striking ``the pilot program'' 
     and inserting ``a program under this section'';
       (4) in the first sentence of subsection (c)--
       (A) by striking ``the pilot program, whole'' and inserting 
     ``a program,'';
       (B) by striking ``the pilot program may'' and inserting ``a 
     program may'';
       (C) by striking ``including'' and inserting ``such as''; 
     and
       (D) by striking ``and iodine'' and inserting ``iodine, and 
     folic acid''; and
       (5) in subsection (d)--
       (A) by striking ``the pilot program'' and inserting 
     ``programs''; and
       (B) by striking ``2002'' and inserting ``2007''.

     SEC. 3014. JOHN OGONOWSKI FARMER-TO-FARMER PROGRAM.

       Section 501 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1737) is amended to read as 
     follows:

     ``SEC. 501. JOHN OGONOWSKI FARMER-TO-FARMER PROGRAM.

       ``(a) Definitions.--In this section:
       ``(1) Caribbean basin country.--The term `Caribbean Basin 
     country' means a country eligible for designation as a 
     beneficiary country under section 212 of the Caribbean Basin 
     Economic Recovery Act (19 U.S.C. 2702).
       ``(2) Emerging market.--The term `emerging market' means a 
     country that the Secretary determines--
       ``(A) is taking steps toward a market-oriented economy 
     through the food, agriculture, or rural business sectors of 
     the economy of the country; and
       ``(B) has the potential to provide a viable and significant 
     market for United States agricultural commodities or products 
     of United States agricultural commodities.
       ``(3) Middle income country.--The term `middle income 
     country' means a country that has developed economically to 
     the point at which the country does not receive bilateral 
     development assistance from the United States.
       ``(4) Sub-saharan african country.--The term `sub-Saharan 
     African country' has the meaning given the term in section 
     107 of the Trade and Development Act of 2000 (19 U.S.C. 
     3706).
       ``(b) Provision.--Notwithstanding any other provision of 
     law, to further assist developing countries, middle-income 
     countries, emerging markets, sub-Saharan African countries, 
     and Caribbean Basin countries to increase farm production and 
     farmer incomes, the President may--
       ``(1) establish and administer a program, to be known as 
     the `John Ogonowski Farmer-to-Farmer Program', of farmer-to-
     farmer assistance between the United States and such 
     countries to assist in--
       ``(A) increasing food production and distribution; and
       ``(B) improving the effectiveness of the farming and 
     marketing operations of agricultural producers in those 
     countries;
       ``(2) use United States agricultural producers, 
     agriculturalists, colleges and universities (including 
     historically black colleges and universities, land grant 
     colleges or universities, and foundations maintained by 
     colleges or universities), private agribusinesses, private 
     organizations (including grassroots organizations with an 
     established and demonstrated capacity to carry out such a 
     bilateral exchange program), private corporations, and 
     nonprofit farm organizations to work in conjunction with 
     agricultural producers and farm organizations in those 
     countries, on a voluntary basis--
       ``(A) to improve agricultural and agribusiness operations 
     and agricultural systems in those countries, including 
     improving--
       ``(i) animal care and health;
       ``(ii) field crop cultivation;

[[Page H1836]]

       ``(iii) fruit and vegetable growing;
       ``(iv) livestock operations;
       ``(v) food processing and packaging;
       ``(vi) farm credit;
       ``(vii) marketing;
       ``(viii) inputs; and
       ``(ix) agricultural extension; and
       ``(B) to strengthen cooperatives and other agricultural 
     groups in those countries;
       ``(3) transfer the knowledge and expertise of United States 
     agricultural producers and businesses, on an individual 
     basis, to those countries while enhancing the democratic 
     process by supporting private and public agriculturally 
     related organizations that request and support technical 
     assistance activities through cash and in-kind services;
       ``(4) to the maximum extent practicable, make grants to or 
     enter into contracts or other cooperative agreements with 
     private voluntary organizations, cooperatives, land grant 
     universities, private agribusiness, or nonprofit farm 
     organizations to carry out this section (except that any such 
     contract or other agreement may obligate the United States to 
     make outlays only to the extent that the budget authority for 
     such outlays is available under subsection (d) or has 
     otherwise been provided in advance in appropriation Acts);
       ``(5) coordinate programs established under this section 
     with other foreign assistance programs and activities carried 
     out by the United States; and
       ``(6) to the extent that local currencies can be used to 
     meet the costs of a program established under this section, 
     augment funds of the United States that are available for 
     such a program through the use, within the country in which 
     the program is being conducted, of--
       ``(A) foreign currencies that accrue from the sale of 
     agricultural commodities and products under this Act; and
       ``(B) local currencies generated from other types of 
     foreign assistance activities.
       ``(c) Special Emphasis on Sub-Saharan African and Caribbean 
     Basin Countries.--
       ``(1) Findings.--Congress finds that--
       ``(A) agricultural producers in sub-Saharan African and 
     Caribbean Basin countries need training in agricultural 
     techniques that are appropriate for the majority of eligible 
     agricultural producers in those countries, including training 
     in--
       ``(i) standard growing practices;
       ``(ii) insecticide and sanitation procedures; and
       ``(iii) other agricultural methods that will produce 
     increased yields of more nutritious and healthful crops;
       ``(B) agricultural producers in the United States 
     (including African-American agricultural producers) and 
     banking and insurance professionals have agribusiness 
     expertise that would be invaluable for agricultural producers 
     in sub-Saharan African and Caribbean Basin countries;
       ``(C) a commitment by the United States is appropriate to 
     support the development of a comprehensive agricultural 
     skills training program for those agricultural producers that 
     focuses on--
       ``(i) improving knowledge of insecticide and sanitation 
     procedures to prevent crop destruction;
       ``(ii) teaching modern agricultural techniques that would 
     facilitate a continual analysis of crop production, 
     including--

       ``(I) the identification and development of standard 
     growing practices; and
       ``(II) the establishment of systems for recordkeeping;

       ``(iii) the use and maintenance of agricultural equipment 
     that is appropriate for the majority of eligible agricultural 
     producers in sub-Saharan African or Caribbean Basin 
     countries;
       ``(iv) the expansion of small agricultural operations into 
     agribusiness enterprises by increasing access to credit for 
     agricultural producers through--

       ``(I) the development and use of village banking systems; 
     and
       ``(II) the use of agricultural risk insurance pilot 
     products; and

       ``(v) marketing crop yields to prospective purchasers 
     (including businesses and individuals) for local needs and 
     export; and
       ``(D) programs that promote the exchange of agricultural 
     knowledge and expertise through the exchange of American and 
     foreign agricultural producers have been effective in 
     promoting improved agricultural techniques and food security 
     and the extension of additional resources to such farmer-to-
     farmer exchanges is warranted.
       ``(2) Goals for programs carried out in sub-saharan african 
     and caribbean countries.--The goals of programs carried out 
     under this section in sub-Saharan African and Caribbean Basin 
     countries shall be--
       ``(A) to expand small agricultural operations in those 
     countries into agribusiness enterprises by increasing access 
     to credit for agricultural producers through--
       ``(i) the development and use of village banking systems; 
     and
       ``(ii) the use of agricultural risk insurance pilot 
     products;
       ``(B) to provide training to agricultural producers in 
     those countries that will--
       ``(i) enhance local food security; and
       ``(ii) help mitigate and alleviate hunger;
       ``(C) to provide training to agricultural producers in 
     those countries in groups to encourage participants to share 
     and pass on to other agricultural producers in the home 
     communities of the participants, the information and skills 
     obtained from the training, rather than merely retaining the 
     information and skills for the personal enrichment of the 
     participants; and
       ``(D) to maximize the number of beneficiaries of the 
     programs in sub-Saharan African and Caribbean Basin 
     countries.
       ``(d) Minimum Funding.--Notwithstanding any other provision 
     of law, in addition to any funds that may be specifically 
     appropriated to carry out this section, not less than 0.5 
     percent of the amounts made available for each of fiscal 
     years 2002 through 2007 to carry out this Act shall be used 
     to carry out programs under this section, with--
       ``(1) not less than 0.2 percent to be used for programs in 
     developing countries; and
       ``(2) not less than 0.1 percent to be used for programs in 
     sub-Saharan African and Caribbean Basin countries.
       ``(e) Authorization of Appropriations.--
       ``(1) In general.--There is authorized to be appropriated 
     to carry out programs under this section in sub-Saharan 
     African and Caribbean Basin countries $10,000,000 for each of 
     fiscal years 2002 through 2007.
       ``(2) Administrative costs.--Not more than 5 percent of the 
     funds made available for a fiscal year under paragraph (1) 
     may be used to pay administrative costs incurred in carrying 
     out programs in sub-Saharan African and Caribbean Basin 
     countries.''.
               Subtitle B--Agricultural Trade Act of 1978

     SEC. 3101. EXPORTER ASSISTANCE INITIATIVE.

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

     ``SEC. 107. EXPORTER ASSISTANCE INITIATIVE.

       ``To provide a comprehensive source of information to 
     facilitate exports of United States agricultural commodities, 
     the Secretary shall maintain on a website on the Internet 
     information to assist exporters and potential exporters of 
     United States agricultural commodities.''.

     SEC. 3102. EXPORT CREDIT GUARANTEE PROGRAM.

       (a) Terms of Supplier Credit Program.--Section 202(a) of 
     the Agricultural Trade Act of 1978 (7 U.S.C. 5622(a)) is 
     amended by adding at the end the following:
       ``(3) Extended supplier credits.--
       ``(A) In general.--Subject to the appropriation of funds 
     under subparagraph (B), in carrying out this section, the 
     Commodity Credit Corporation may issue guarantees for the 
     repayment of credit made available for a period of more than 
     180 days, but not more than 360 days, by a United States 
     exporter to a buyer in a foreign country.
       ``(B) Authorization of appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     fund the additional costs attributable to the portion of any 
     guarantee issued under this paragraph to cover the repayment 
     of credit beyond the initial 180-day period.''.
       (b) Processed and High-Value Products.--Section 202(k)(1) 
     of the Agricultural Trade Act of 1978 (7 U.S.C. 5622(k)(1)) 
     is amended by striking ``, 2001, and 2002'' and inserting 
     ``through 2007''.
       (c) Report.--Section 202 of the Agricultural Trade Act of 
     1978 (7 U.S.C. 5622) is amended by adding at the end the 
     following:
       ``(l) Consultation on Agricultural Export Credit 
     Programs.--The Secretary and the United States Trade 
     Representative shall consult on a regular basis with the 
     Committee on Agriculture, and the Committee on International 
     Relations, of the House of Representatives and the Committee 
     on Agriculture, Nutrition, and Forestry of the Senate on the 
     status of multilateral negotiations regarding agricultural 
     export credit programs.''.
       (d) Reauthorization.--Section 211(b)(1) of the Agricultural 
     Trade Act of 1978 (7 U.S.C. 5641(b)(1)) is amended by 
     striking ``2002'' and inserting ``2007''.

     SEC. 3103. MARKET ACCESS PROGRAM.

       Section 211(c) of the Agricultural Trade Act of 1978 (7 
     U.S.C. 5641(c)) is amended--
       (1) by redesignating paragraphs (1) and (2) as 
     subparagraphs (A) and (B), respectively, and indenting 
     appropriately;
       (2) by striking ``The Commodity'' and inserting the 
     following:
       ``(1) In general.--The Commodity'';
       (3) by striking subparagraph (A) (as so redesignated) and 
     inserting the following:
       ``(A) in addition to any funds that may be specifically 
     appropriated to implement a market access program, not more 
     than $90,000,000 for fiscal year 2001, $100,000,000 for 
     fiscal year 2002, $110,000,000 for fiscal year 2003, 
     $125,000,000 for fiscal year 2004, $140,000,000 for fiscal 
     year 2005, and $200,000,000 for each of fiscal years 2006 and 
     2007, of the funds of, or an equal value of commodities owned 
     by, the Commodity Credit Corporation; and''; and
       (4) by adding at the end the following:
       ``(2) Program priorities.--In providing any amount of funds 
     made available under paragraph (1)(A) for any fiscal year 
     that is in excess of the amount made available under 
     paragraph (1)(A) for fiscal year 2001, the Secretary shall, 
     to the maximum extent practicable--
       ``(A) give equal consideration to--
       ``(i) proposals submitted by organizations that were 
     participating organizations in prior fiscal years; and
       ``(ii) proposals submitted by eligible trade organizations 
     that have not previously participated in the program 
     established under this title; and
       ``(B) give equal consideration to--
       ``(i) proposals submitted for activities in emerging 
     markets; and
       ``(ii) proposals submitted for activities in markets other 
     than emerging markets.''.

     SEC. 3104. EXPORT ENHANCEMENT PROGRAM.

       (a) In General.--Section 301(e)(1)(G) of the Agricultural 
     Trade Act of 1978 (7 U.S.C. 5651(e)(1)(G)) is amended by 
     striking ``fiscal year 2002'' and inserting ``each of fiscal 
     years 2002 through 2007''.
       (b) Unfair Trade Practices.--Section 102(5)(A) of the 
     Agricultural Trade Act of 1978 (7 U.S.C. 5602(5)(A)) is 
     amended--
       (1) in clause (i), by striking ``or'' at the end; and

[[Page H1837]]

       (2) by striking clause (ii) and inserting the following:
       ``(ii) in the case of a monopolistic state trading 
     enterprise engaged in the export sale of an agricultural 
     commodity, implements a pricing practice that is inconsistent 
     with sound commercial practice;
       ``(iii) provides a subsidy that--

       ``(I) decreases market opportunities for United States 
     exports; or
       ``(II) unfairly distorts an agricultural market to the 
     detriment of United States exporters;

       ``(iv) imposes an unfair technical barrier to trade, 
     including--

       ``(I) a trade restriction or commercial requirement (such 
     as a labeling requirement) that adversely affects a new 
     technology (including biotechnology); and
       ``(II) an unjustified sanitary or phytosanitary restriction 
     (including any restriction that, in violation of the Uruguay 
     Round Agreements, is not based on scientific principles;

       ``(v) imposes a rule that unfairly restricts imports of 
     United States agricultural commodities in the administration 
     of tariff rate quotas; or
       ``(vi) fails to adhere to, or circumvents any obligation 
     under, any provision of a trade agreement with the United 
     States.''.

     SEC. 3105. FOREIGN MARKET DEVELOPMENT COOPERATOR PROGRAM.

       (a) Value-Added Products.--
       (1) In general.--Section 702(a) of the Agricultural Trade 
     Act of 1978 (7 U.S.C. 5722(a)) is amended by inserting ``, 
     with a continued significant emphasis on the importance of 
     the export of value-added United States agricultural products 
     into emerging markets'' after ``products''.
       (2) Report to congress.--Section 702 of the Agricultural 
     Trade Act of 1978 (7 U.S.C. 5722) is amended by adding at the 
     end the following:
       ``(c) Report to Congress.--The Secretary shall annually 
     submit to the Committee on Agriculture and the Committee on 
     International Relations of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate a report on activities under this section describing 
     the amount of funding provided, the types of programs funded, 
     the value-added products that have been targeted, and the 
     foreign markets for those products that have been 
     developed.''.
       (b) Funding.--Section 703 of the Agricultural Trade Act of 
     1978 (7 U.S.C. 5723) is amended to read as follows:

     ``SEC. 703. FUNDING.

       ``(a) In General.--To carry out this title, the Secretary 
     shall use funds of the Commodity Credit Corporation, or 
     commodities of the Commodity Credit Corporation of a 
     comparable value, in the amount of $34,500,000 for each of 
     fiscal years 2002 through 2007.
       ``(b) Program Priorities.--In providing any amount of funds 
     or commodities made available under subsection (a) for any 
     fiscal year that is in excess of the amount made available 
     under this section for fiscal year 2001, the Secretary shall, 
     to the maximum extent practicable--
       ``(1) give equal consideration to--
       ``(A) proposals submitted by organizations that were 
     participating organizations in prior fiscal years; and
       ``(B) proposals submitted by eligible trade organizations 
     that have not previously participated in the program 
     established under this title; and
       ``(2) give equal consideration to--
       ``(A) proposals submitted for activities in emerging 
     markets; and
       ``(B) proposals submitted for activities in markets other 
     than emerging markets.''.

     SEC. 3106. FOOD FOR PROGRESS.

       (a) In General.--Subsections (f)(3), (k), and (l)(1) of the 
     Food for Progress Act of 1985 (7 U.S.C. 1736o) are each 
     amended by striking ``2002'' and inserting ``2007''.
       (b) Definitions; Program.--
       (1) In general.--The Food for Progress Act of 1985 (7 
     U.S.C. 1736o) is amended by striking subsections (b) and (c) 
     and inserting the following:
       ``(b) Definitions.--In this section:
       ``(1) Cooperative.--The term `cooperative' has the meaning 
     given the term in section 402 of the Agricultural Trade 
     Development and Assistance Act of 1954 (7 U.S.C. 1732).
       ``(2) Corporation.--The term `Corporation' means the 
     Commodity Credit Corporation.
       ``(3) Developing country.--The term `developing country' 
     has the meaning given the term in section 402 of the 
     Agricultural Trade Development and Assistance Act of 1954 (7 
     U.S.C. 1732).
       ``(4) Eligible commodity.--The term `eligible commodity' 
     means an agricultural commodity, or a product of an 
     agricultural commodity, in inventories of the Corporation or 
     acquired by the President or the Corporation for disposition 
     through commercial purchases under a program authorized under 
     this section.
       ``(5) Eligible entity.--The term `eligible entity' means--
       ``(A) the government of an emerging agricultural country;
       ``(B) an intergovernmental organization;
       ``(C) a private voluntary organization;
       ``(D) a nonprofit agricultural organization or cooperative;
       ``(E) a nongovernmental organization; and
       ``(F) any other private entity.
       ``(6) Food security.--The term `food security' means access 
     by all people at all times to sufficient food and nutrition 
     for a healthy and productive life.
       ``(7) Nongovernmental organization.--The term 
     `nongovernmental organization' has the meaning given the term 
     in section 402 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1732).
       ``(8) Private voluntary organization.--The term `private 
     voluntary organization' has the meaning given the term in 
     section 402 of the Agricultural Trade Development and 
     Assistance Act of 1954 (7 U.S.C. 1732).
       ``(9) Program.--The term `program' means a food assistance 
     or development initiative proposed by an eligible entity and 
     approved by the President under this section.
       ``(c) Program.--In order to use the food resources of the 
     United States more effectively in support of developing 
     countries, and countries that are emerging democracies that 
     have made commitments to introduce or expand free enterprise 
     elements in their agricultural economies through changes in 
     commodity pricing, marketing, input availability, 
     distribution, and private sector involvement, the President 
     may enter into agreements with eligible entities to furnish 
     to the countries eligible commodities made available under 
     subsections (e) and (f).''.
       (2) Conforming amendments.--The Food for Progress Act of 
     1985 (7 U.S.C. 136o) is amended--
       (A) in the first sentence of subsection (d), by striking 
     ``food'';
       (B) in subsection (l)(2), by striking ``agricultural'';
       (C) in subsection (m)(1), by striking ``these'';
       (D) in subsections (d), (e), (f), (h), (j), (l), and (m), 
     by striking ``commodities'' each place it appears and 
     inserting ``eligible commodities''; and
       (E) in subsections (e), (f), and (l), by striking 
     ``Commodity Credit Corporation'' each place it appears and 
     inserting ``Corporation''; and
       (F) by striking subsection (o).
       (c) Consideration for Agreements.--Subsection (d) of the 
     Food for Progress Act of 1985 (7 U.S.C. 1736o(d)) is amended 
     by striking ``(d) In determining'' and inserting ``(d) 
     Consideration for Agreements.--In determining''.
       (d) Funding of Eligible Commodities.--Subsection (e) of the 
     Food for Progress Act of 1985 (7 U.S.C. 1736o(e)) is 
     amended--
       (1) by striking ``(e)'' and inserting ``(e) Funding of 
     Eligible Commodities.--'';
       (2) in paragraph (2), by inserting ``, and subsection (g) 
     does not apply to eligible commodities furnished on a grant 
     basis or on credit terms under that title'' before the period 
     at the end; and
       (3) by adding at the end the following:
       ``(5) No effect on domestic programs.--The President shall 
     not make an eligible commodity available for disposition 
     under this section in any amount that will reduce the amount 
     of the eligible commodity that is traditionally made 
     available through donations to domestic feeding programs or 
     agencies, as determined by the President.
       (e) Provision of Eligible Commodities to Developing 
     Countries.--Subsection (f) of the Food for Progress Act of 
     1985 (7 U.S.C. 1736o(f)) is amended--
       (1) by striking ``(f)'' and inserting ``(f) Provision of 
     Eligible Commodities to Developing Countries.--''; and
       (2) in paragraph (3), by striking ``$30,000,000 (or in the 
     case of fiscal year 1999, $35,000,000)'' and inserting 
     ``$40,000,000''.
       (f) Minimum Tonnage.--The Food for Progress Act of 1985 is 
     amended by striking subsection (g) (7 U.S.C. 1736o(g)) and 
     inserting the following:
       ``(g) Minimum Tonnage.--Subject to subsection (f)(3), not 
     less than 400,000 metric tons of eligible commodities may be 
     provided under this section for the program for each of 
     fiscal years 2002 through 2007.''.
       (g) Prohibition on Resale or Transshipment of Eligible 
     Commodities.--Subsection (h) of the Food for Progress Act of 
     1985 (7 U.S.C. 1736o(h)) is amended by striking ``(h) An 
     agreement'' and inserting ``(h) Prohibition on Resale or 
     Transshipment of Eligible Commodities.--An agreement''.
       (h) Displacement of United States Commercial Sales.--
     Subsection (i) of the Food for Progress Act of 1985 (7 U.S.C. 
     1736o(i)) is amended by striking ``(i) In entering'' and 
     inserting ``(i) Displacement of United States Commercial 
     Sales.--In entering''.
       (i) Multicountry or Multiyear Basis.--Subsection (j) of the 
     Food for Progress Act of 1985 (7 U.S.C. 1736o(j)) is 
     amended--
       (1) by striking ``(j) In carrying out this section, the 
     President may,'' and inserting the following: ``(j) 
     Multicountry or Multiyear Basis.--
       ``(1) In general.--In carrying out this section, the 
     President,'';
       (2) by striking ``approve'' and inserting ``is encouraged 
     to approve'';
       (3) by striking ``multiyear'' and inserting ``multicountry 
     or multiyear''; and
       (4) by adding at the end the following:
       ``(2) Deadline for program announcements.--Before the 
     beginning of any fiscal year, the President shall, to the 
     maximum extent practicable--
       ``(A) make all determinations concerning program agreements 
     and resource requests for programs under this section; and
       ``(B) announce those determinations.
       ``(3) Report.--Not later than December 1 of each fiscal 
     year, the President shall submit to the Committee on 
     Agriculture of the House of Representatives and the Committee 
     on Agriculture, Nutrition, and Forestry of the Senate a list 
     of programs, countries, and eligible commodities, and the 
     total amount of funds for transportation and administrative 
     costs, approved to date for the fiscal year under this 
     section.''.
       (j) Effective and Termination Dates.--Subsection (k) of the 
     Food for Progress Act of 1985 (7 U.S.C. 1736o(k)) is amended 
     by striking ``(k) This section'' and inserting ``(k) 
     Effective and Termination Dates.--This section''.
       (k) Administrative Expenses.--Subsection (l) of the Food 
     for Progress Act of 1985 (7 U.S.C. 1736o(l)) is amended--
       (1) by striking ``(l)'' and inserting ``(l) Administrative 
     Expenses.--'';
       (2) in paragraph (1), by striking ``$10,000,000'' and 
     inserting ``$15,000,000'';
       (3) in paragraph (3), by striking ``local currencies'' and 
     inserting ``proceeds''; and

[[Page H1838]]

       (4) by adding at the end the following:
       ``(4) Humanitarian or development purposes.--The Secretary 
     may authorize the use of proceeds to pay the costs incurred 
     by an eligible entity under this section for--
       ``(A)(i) programs targeted at hunger and malnutrition; or
       ``(ii) development programs involving food security;
       ``(B) transportation, storage, and distribution of eligible 
     commodities provided under this section; and
       ``(C) administration, sales, monitoring, and technical 
     assistance.''.
       (l) Presidential Approval.--Subsection (m) of the Food for 
     Progress Act of 1985 (7 U.S.C. 1736o(m)) is amended by 
     striking ``(m) In carrying'' and inserting ``(m) Presidential 
     Approval.--In carrying''.
       (m) Program Management.--The Food for Progress Act of 1985 
     is amended by striking subsection (n) (7 U.S.C. 1736o(n)) and 
     inserting the following:
       ``(n) Program Management.--
       ``(1) In general.--The President shall ensure, to the 
     maximum extent practicable, that each eligible entity 
     participating in 1 or more programs under this section--
       ``(A) uses eligible commodities made available under this 
     section--
       ``(i) in an effective manner;
       ``(ii) in the areas of greatest need; and
       ``(iii) in a manner that promotes the purposes of this 
     section;
       ``(B) in using eligible commodities, assesses and takes 
     into account the needs of recipient countries and the target 
     populations of the recipient countries;
       ``(C) works with recipient countries, and indigenous 
     institutions or groups in recipient countries, to design and 
     carry out mutually acceptable programs authorized under this 
     section; and
       ``(D) monitors and reports on the distribution or sale of 
     eligible commodities provided under this section using 
     methods that, as determined by the President, facilitate 
     accurate and timely reporting.
       ``(2) Requirements.--
       ``(A) In general.--Not later than 270 days after the date 
     of enactment of this paragraph, the President shall review 
     and, as necessary, make changes in regulations and internal 
     procedures designed to streamline, improve, and clarify the 
     application, approval, and implementation processes 
     pertaining to agreements under this section.
       ``(B) Considerations.--In conducting the review, the 
     President shall consider--
       ``(i) revising procedures for submitting proposals;
       ``(ii) developing criteria for program approval that 
     separately address the objectives of the program;
       ``(iii) pre-screening organizations and proposals to ensure 
     that the minimum qualifications are met;
       ``(iv) implementing e-government initiatives and otherwise 
     improving the efficiency of the proposal submission and 
     approval processes;
       ``(v) upgrading information management systems;
       ``(vi) improving commodity and transportation procurement 
     processes; and
       ``(vii) ensuring that evaluation and monitoring methods are 
     sufficient.
       ``(C) Consultations.--Not later than 1 year after the date 
     of enactment of this paragraph, the President shall consult 
     with the Committee on Agriculture, and the Committee on 
     International Relations, of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate on changes made in regulations and procedures.
       ``(3) Reports.--Each eligible entity that enters into an 
     agreement under this section shall submit to the President, 
     at such time as the President may request, a report 
     containing such information as the President may request 
     relating to the use of eligible commodities and funds 
     furnished to the eligible entity under this section.''.

     SEC. 3107. MCGOVERN-DOLE INTERNATIONAL FOOD FOR EDUCATION AND 
                   CHILD NUTRITION PROGRAM.

       (a) Definition of Agricultural Commodity.--In this section, 
     the term ``agricultural commodity'' means an agricultural 
     commodity, or a product of an agricultural commodity, that is 
     produced in the United States.
       (b) Program.--Subject to subsection (l), the President may 
     establish a program, to be known as ``McGovern-Dole 
     International Food for Education and Child Nutrition 
     Program'', requiring the procurement of agricultural 
     commodities and the provision of financial and technical 
     assistance to carry out--
       (1) preschool and school food for education programs in 
     foreign countries to improve food security, reduce the 
     incidence of hunger, and improve literacy and primary 
     education, particularly with respect to girls; and
       (2) maternal, infant, and child nutrition programs for 
     pregnant women, nursing mothers, infants, and children who 
     are 5 years of age or younger.
       (c) Eligible Commodities and Cost Items.--Notwithstanding 
     any other provision of law--
       (1) any agricultural commodity is eligible to be provided 
     under this section;
       (2) as necessary to achieve the purposes of this section, 
     funds appropriated under this section may be used to pay--
       (A)(i) the cost of acquiring agricultural commodities;
       (ii) the costs associated with packaging, enrichment, 
     preservation, and fortification of agricultural commodities;
       (iii) the processing, transportation, handling, and other 
     incidental costs up to the time of the delivery of 
     agricultural commodities free on board vessels in United 
     States ports;
       (iv) the vessel freight charges from United States ports or 
     designated Canadian transshipment ports, as determined by the 
     Secretary, to designated ports of entry abroad;
       (v) the costs associated with transporting agricultural 
     commodities from United States ports to designated points of 
     entry abroad in the case--
       (I) of landlocked countries;
       (II) of ports that cannot be used effectively because of 
     natural or other disturbances;
       (III) of the unavailability of carriers to a specific 
     country; or
       (IV) of substantial savings in costs or time that may be 
     effected by the utilization of points of entry other than 
     ports; and
       (vi) the charges for general average contributions arising 
     out of the ocean transport of agricultural commodities 
     transferred pursuant thereto;
       (B) all or any part of the internal transportation, 
     storage, and handling costs incurred in moving the eligible 
     commodity, if the President determines that--
       (i) payment of the costs is appropriate; and
       (ii) the recipient country is a low income, net food-
     importing country that--

       (I) meets the poverty criteria established by the 
     International Bank for Reconstruction and Development for 
     Civil Works Preference; and
       (II) has a national government that is committed to or is 
     working toward, through a national action plan, the goals of 
     the World Declaration on Education for All convened in 1990 
     in Jomtien, Thailand, and the followup Dakar Framework for 
     Action of the World Education Forum, convened in 2000;

       (C) the costs of activities conducted in the recipient 
     countries by a nonprofit voluntary organization, cooperative, 
     or intergovernmental agency or organization that would 
     enhance the effectiveness of the activities implemented by 
     such entities under this section; and
       (D) the costs of meeting the allowable administrative 
     expenses of private voluntary organizations, cooperatives, or 
     intergovernmental organizations that are implementing 
     activities under this section.
       (d) General Authorities.--The President shall designate 1 
     or more Federal agencies to--
       (1) implement the program established under this section;
       (2) ensure that the program established under this section 
     is consistent with the foreign policy and development 
     assistance objectives of the United States; and
       (3) consider, in determining whether a country should 
     receive assistance under this section, whether the government 
     of the country is taking concrete steps to improve the 
     preschool and school systems in the country.
       (e) Eligible Entities.--Assistance may be provided under 
     this section to private voluntary organizations, 
     cooperatives, intergovernmental organizations, governments of 
     developing countries and their agencies, and other 
     organizations.
       (f) Procedures.--
       (1) In general.--In carrying out subsection (b), the 
     President shall ensure that procedures are established that--
       (A) provide for the submission of proposals by eligible 
     entities, each of which may include 1 or more recipient 
     countries, for commodities and other assistance under this 
     section;
       (B) provide for eligible commodities and assistance on a 
     multiyear basis;
       (C) ensure that eligible entities demonstrate the 
     organizational capacity and the ability to develop, 
     implement, monitor, report on, and provide accountability for 
     activities conducted under this section;
       (D) provide for the expedited development, review, and 
     approval of proposals submitted in accordance with this 
     section;
       (E) ensure monitoring and reporting by eligible entities on 
     the use of commodities and other assistance provided under 
     this section; and
       (F) allow for the sale or barter of commodities by eligible 
     entities to acquire funds to implement activities that 
     improve the food security of women and children or otherwise 
     enhance the effectiveness of programs and activities 
     authorized under this section.
       (2) Priorities for program funding.--In carrying out 
     paragraph (1) with respect to criteria for determining the 
     use of commodities and other assistance provided for programs 
     and activities authorized under this section, the 
     implementing agency may consider the ability of eligible 
     entities to--
       (A) identify and assess the needs of beneficiaries, 
     especially malnourished or undernourished mothers and their 
     children who are 5 years of age or younger, and school-age 
     children who are malnourished, undernourished, or do not 
     regularly attend school;
       (B)(i) in the case of preschool and school-age children, 
     target low-income areas where children's enrollment and 
     attendance in school is low or girls' enrollment and 
     participation in preschool or school is low, and incorporate 
     developmental objectives for improving literacy and primary 
     education, particularly with respect to girls; and
       (ii) in the case of programs to benefit mothers and 
     children who are 5 years of age or younger, coordinate 
     supplementary feeding and nutrition programs with existing or 
     newly-established maternal, infant, and children programs 
     that provide health-needs interventions, including maternal, 
     prenatal, and postnatal and newborn care;
       (C) involve indigenous institutions as well as local 
     communities and governments in the development and 
     implementation of the programs and activities to foster local 
     capacity building and leadership; and
       (D) carry out multiyear programs that foster local self-
     sufficiency and ensure the longevity of programs in the 
     recipient country.
       (g) Use of Food and Nutrition Service.--The Food and 
     Nutrition Service of the Department of Agriculture may 
     provide technical advice on the establishment of programs 
     under

[[Page H1839]]

     subsection (b)(1) and on implementation of the programs in 
     the field in recipient countries.
       (h) Multilateral Involvement.--
       (1) In general.--The President is urged to engage existing 
     international food aid coordinating mechanisms to ensure 
     multilateral commitments to, and participation in, programs 
     similar to programs supported under this section.
       (2) Reports.--The President shall annually submit to the 
     Committee on International Relations and the Committee on 
     Agriculture of the House of Representatives and the Committee 
     on Agriculture, Nutrition, and Forestry of the Senate a 
     report on the commitments and activities of governments, 
     including the United States government, in the global effort 
     to reduce child hunger and increase school attendance.
       (i) Private Sector Involvement.--The President is urged to 
     encourage the support and active involvement of the private 
     sector, foundations, and other individuals and organizations 
     in programs assisted under this section.
       (j) Graduation.--An agreement with an eligible organization 
     under this section shall include provisions--
       (1) to--
       (A) sustain the benefits to the education, enrollment, and 
     attendance of children in schools in the targeted communities 
     when the provision of commodities and assistance to a 
     recipient country under a program under this section 
     terminates; and
       (B) estimate the period of time required until the 
     recipient country or eligible organization is able to provide 
     sufficient assistance without additional assistance under 
     this section; or
       (2) to provide other long-term benefits to targeted 
     populations of the recipient country.
       (k) Requirement To Safeguard Local Production and Usual 
     Marketing.--The requirement of section 403(a) of the 
     Agricultural Trade Development and Assistance Act of 1954 (7 
     U.S.C. 1733(a)) applies with respect to the availability of 
     commodities under this section.
       (l) Funding.--
       (1) In general.--Of the funds of the Commodity Credit 
     Corporation, the President shall use $100,000,000 for fiscal 
     year 2003 to carry out this section.
       (2) Authorization of appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section for each of fiscal years 2004 through 2007.
       (3) Administrative expenses.--Funds made available to carry 
     out this section may be used to pay the administrative 
     expenses of any Federal agency implementing or assisting in 
     the implementation of this section.
                       Subtitle C--Miscellaneous

     SEC. 3201. SURPLUS COMMODITIES FOR DEVELOPING OR FRIENDLY 
                   COUNTRIES.

       (a) Use of Currencies.--Section 416(b)(7)(D) of the 
     Agricultural Act of 1949 (7 U.S.C. 1431(b)(7)(D)) is 
     amended--
       (1) in clauses (i) and (iii), by striking ``foreign 
     currency'' each place it appears;
       (2) in clause (ii)--
       (A) by striking ``Foreign currencies'' and inserting 
     ``Proceeds''; and
       (B) by striking ``foreign currency''; and
       (3) in clause (iv)--
       (A) by striking ``Foreign currency proceeds'' and inserting 
     ``Proceeds'';
       (B) by striking ``country of origin'' the second place it 
     appears and all that follows through ``as necessary to 
     expedite'' and inserting ``country of origin as necessary to 
     expedite'';
       (C) by striking ``; or'' and inserting a period; and
       (D) by striking subclause (II).
       (b) Implementation of Agreements.--Section 416(b) of the 
     Agricultural Act of 1949 (7 U.S.C. 1431(b)) (as amended by 
     section 3009(b)) is amended--
       (1) in paragraph (8), by striking ``(8)(A)'' and all that 
     follows through ``(B) The Secretary'' and inserting the 
     following:
       ``(8) Administrative provisions.--
       ``(A) Expedited procedures.--To the maximum extent 
     practicable, expedited procedures shall be used in the 
     implementation of this subsection.
       ``(B) Estimate of commodities.--The Secretary shall publish 
     in the Federal Register, not later than October 31 of each 
     fiscal year, an estimate of the types and quantities of 
     commodities and products that will be available under this 
     section for the fiscal year.
       ``(C) Finalization of agreements.--The Secretary is 
     encouraged to finalize program agreements under this section 
     not later than December 31 of each fiscal year.
       ``(D) Regulations.--The Secretary''; and
       (2) by adding at the end the following:
       ``(11) Requirements.--
       ``(A) In general.--Not later than 270 days after the date 
     of enactment of this subparagraph, the Secretary shall review 
     and, as necessary, make changes in regulations and internal 
     procedures designed to streamline, improve, and clarify the 
     application, approval, and implementation processes 
     pertaining to agreements under this section.
       ``(B) Considerations.--In conducting the review, the 
     Secretary shall consider--
       ``(i) revising procedures for submitting proposals;
       ``(ii) developing criteria for program approval that 
     separately address the objectives of the program;
       ``(iii) pre-screening organizations and proposals to ensure 
     that the minimum qualifications are met;
       ``(iv) implementing e-government initiatives and otherwise 
     improving the efficiency of the proposal submission and 
     approval processes;
       ``(v) upgrading information management systems;
       ``(vi) improving commodity and transportation procurement 
     processes; and
       ``(vii) ensuring that evaluation and monitoring methods are 
     sufficient.
       ``(C) Consultations.--Not later than 1 year after the date 
     of enactment of this subparagraph, the Secretary shall 
     consult with the Committee on Agriculture, and the Committee 
     on International Relations, of the House of Representatives 
     and the Committee on Agriculture, Nutrition, and Forestry of 
     the Senate on changes made in regulations and procedures 
     under this paragraph.''.

     SEC. 3202. BILL EMERSON HUMANITARIAN TRUST.

       Section 302 of the Bill Emerson Humanitarian Trust Act (7 
     U.S.C. 1736f-1) is amended by striking ``2002'' each place it 
     appears in subsection (b)(2)(B)(i) and paragraphs (1) and (2) 
     of subsection (h) and inserting ``2007''.

     SEC. 3203. EMERGING MARKETS.

       Section 1542 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5622 note) is amended in 
     subsections (a) and (d)(1)(A)(i) by striking ``2002'' and 
     inserting ``2007''.

     SEC. 3204. BIOTECHNOLOGY AND AGRICULTURAL TRADE PROGRAM.

       The Food, Agriculture, Conservation, and Trade Act of 1990 
     is amended by inserting after section 1543 (7 U.S.C. 3293) 
     the following:

     ``SEC. 1543A. BIOTECHNOLOGY AND AGRICULTURAL TRADE PROGRAM.

       ``(a) Establishment.--There is established in the 
     Department the biotechnology and agricultural trade program.
       ``(b) Purpose.--The purpose of the program shall be to 
     remove, resolve, or mitigate significant regulatory nontariff 
     barriers to the export of United States agricultural 
     commodities (as defined in section 102 of the Agricultural 
     Trade Act of 1978 (7 U.S.C. 5602)) into foreign markets 
     through public and private sector projects funded by grants 
     that address--
       ``(1) quick response intervention regarding nontariff 
     barriers to United States exports involving--
       ``(A) United States agricultural commodities produced 
     through biotechnology;
       ``(B) food safety;
       ``(C) disease; or
       ``(D) other sanitary or phytosanitary concerns; or
       ``(2) developing protocols as part of bilateral 
     negotiations with other countries on issues such as animal 
     health, grain quality, and genetically modified commodities.
       ``(c) Eligible Programs.--Depending on need, as determined 
     by the Secretary, activities authorized under this section 
     may be carried out through--
       ``(1) this section;
       ``(2) the emerging markets program under section 1542; or
       ``(3) the Cochran Fellowship Program under section 1543.
       ``(d) Funding.--There is authorized to be appropriated 
     $6,000,000 for each of fiscal years 2002 through 2007.''.

     SEC. 3205. TECHNICAL ASSISTANCE FOR SPECIALTY CROPS.

       (a) Establishment.--The Secretary of Agriculture shall 
     establish an export assistance program (referred to in this 
     section as the ``program'') to address unique barriers that 
     prohibit or threaten the export of United States specialty 
     crops.
       (b) Purpose.--The program shall provide direct assistance 
     through public and private sector projects and technical 
     assistance to remove, resolve, or mitigate sanitary and 
     phytosanitary and related barriers to trade.
       (c) Priority.--The program shall address time sensitive and 
     strategic market access projects based on--
       (1) trade effect on market retention, market access, and 
     market expansion; and
       (2) trade impact.
       (d) Funding.--For each of fiscal years 2002 through 2007, 
     the Secretary shall make available $2,000,000 of the funds 
     of, or an equal value of commodities owned by, the Commodity 
     Credit Corporation.

     SEC. 3206. GLOBAL MARKET STRATEGY.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this Act, and biennially thereafter, the 
     Secretary of Agriculture shall consult with the Committee on 
     Agriculture, and the Committee on International Relations, of 
     the House of Representatives and the Committee on 
     Agriculture, Nutrition, and Forestry of the Senate on the 
     formulation and implementation of a global market strategy 
     for the Department of Agriculture that, to the maximum extent 
     practicable--
       (1) identifies opportunities for the growth of agricultural 
     exports to overseas markets;
       (2) ensures that the resources, programs, and policies of 
     the Department are coordinated with those of other agencies; 
     and
       (3) remove barriers to agricultural trade in overseas 
     markets.
       (b) Review.--The consultations under subsection (a) shall 
     include a review of--
       (1) the strategic goals of the Department; and
       (2) the progress of the Department in implementing the 
     strategic goals through the global market strategy.

     SEC. 3207. REPORT ON USE OF PERISHABLE COMMODITIES AND LIVE 
                   ANIMALS.

       Not later than 120 days after the date of enactment of this 
     Act, the Secretary of Agriculture shall submit to the 
     Committee on Agriculture of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate a report on international food aid programs of the 
     United States that evaluates--
       (1) the implications of storage and transportation capacity 
     and funding for the use of perishable agricultural 
     commodities and semiperishable agricultural commodities; and
       (2) the feasibility of the transport of lambs and other 
     live animals under the program.

     SEC. 3208. STUDY ON FEE FOR SERVICES.

       (a) In General.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary

[[Page H1840]]

     of Agriculture shall submit to the Committee on Agriculture, 
     and the Committee on International Relations, of the House of 
     Representatives and the Committee on Agriculture, Nutrition 
     and Forestry of the Senate a report on the feasibility of 
     instituting a program under which the Secretary would charge 
     and retain a fee to cover the costs incurred by the 
     Department of Agriculture, acting through the Foreign 
     Agricultural Service or any successor agency, in providing 
     persons with commercial services provided outside the United 
     States.
       (b) Purpose of Program.--The purpose of a program described 
     in subsection (a) would be to supplement and not replace any 
     services currently offered overseas by the Foreign 
     Agricultural Service.
       (c) Market Development Strategy.--A program under 
     subsection (b) would be part of an overall market development 
     strategy for a particular country or region.
       (d) Pilot Program.--A program under subsection (a) would be 
     established on a pilot basis to ensure that the program does 
     not disadvantage small- and medium-sized companies, including 
     companies that have never engaged in exporting.

     SEC. 3209. SENSE OF CONGRESS CONCERNING FOREIGN ASSISTANCE 
                   PROGRAMS.

       (a) Findings.--Congress finds that--
       (1) the international community faces a continuing epidemic 
     of ethnic, sectarian, and criminal violence;
       (2) poverty, hunger, political uncertainty, and social 
     instability are the principal causes of violence and conflict 
     around the world;
       (3) broad-based, equitable economic growth and agriculture 
     development facilitates political stability, food security, 
     democracy, and the rule of law;
       (4) democratic governments are more likely to advocate and 
     observe international laws, protect civil and human rights, 
     pursue free market economies, and avoid external conflicts;
       (5) the United States Agency for International Development 
     has provided critical democracy and governance assistance to 
     a majority of the nations that successfully made the 
     transition to democratic governments during the past 2 
     decades;
       (6) 43 of the top 50 consumer nations of American 
     agricultural products were once United States foreign aid 
     recipients;
       (7) in the past 50 years, infant child death rates in the 
     developing world have been reduced by 50 percent, and health 
     conditions around the world have improved more during this 
     period than in any other period;
       (8) the United States Agency for International Development 
     child survival programs have significantly contributed to a 
     10 percent reduction in infant mortality rates worldwide in 
     just the past 8 years;
       (9) in providing assistance by the United States and other 
     donors in better seeds and teaching more efficient 
     agricultural techniques over the past 2 decades have helped 
     make it possible to feed an additional 1,000,000,000 people 
     in the world;
       (10) despite this progress, approximately 1,200,000,000 
     people, one-quarter of the world's population, live on less 
     that $1 per day, and approximately 3,000,000,000 people live 
     on only $2 per day;
       (11) 95 percent of new births occur in developing 
     countries, including the world's poorest countries; and
       (12) only \1/2\ percent of the Federal budget is dedicated 
     to international economic and humanitarian assistance.
       (b) Sense of Congress.--It is the sense of Congress that--
       (1) United States foreign assistance programs should play 
     an increased role in the global fight against terrorism to 
     complement the national security objectives of the United 
     States;
       (2) the United States should lead coordinated international 
     efforts to provide increased financial assistance to 
     countries with impoverished and disadvantaged populations 
     that are the breeding grounds for terrorism; and
       (3) the United States Agency for International Development 
     and the Department of Agriculture should substantially 
     increase humanitarian, economic development, and agricultural 
     assistance to foster international peace and stability and 
     the promotion of human rights.

     SEC. 3210. SENSE OF THE SENATE CONCERNING AGRICULTURAL TRADE.

       (a) Agriculture Trade Negotiating Objectives.--It is the 
     sense of the Senate that the principal negotiating objective 
     of the United States with respect to agricultural trade in 
     all multilateral, regional, and bilateral negotiations is to 
     obtain competitive opportunities for the export of United 
     States agricultural commodities in foreign markets 
     substantially equivalent to the competitive opportunities 
     afforded foreign exports in United States markets and to 
     achieve fairer and more open conditions of agricultural trade 
     in bulk and value-added commodities by--
       (1) reducing or eliminating, by a date certain, tariffs or 
     other charges that decrease market opportunities for the 
     export of United States agricultural commodities, giving 
     priority to United States agricultural commodities that are 
     subject to significantly higher tariffs or subsidy regimes of 
     major producing countries;
       (2) immediately eliminating all export subsidies on 
     agricultural commodities worldwide while maintaining bona 
     fide food aid and preserving United States agricultural 
     market development and export credit programs that allow the 
     United States to compete with other foreign export promotion 
     efforts;
       (3) leveling the playing field for United States 
     agricultural producers by disciplining domestic supports such 
     that no other country can provide greater support, measured 
     as a percentage of total agricultural production value, than 
     the United States does while preserving existing green box 
     category to support conservation activities, family farms, 
     and rural communities;
       (4) developing, strengthening, and clarifying rules and 
     effective dispute settlement mechanisms to eliminate 
     practices that unfairly decrease United States market access 
     opportunities for United States agricultural commodities or 
     distort agricultural markets to the detriment of the United 
     States, including--
       (A) unfair or trade-distorting activities of state trading 
     enterprises and other administrative mechanisms, with 
     emphasis on--
       (i) requiring price transparency in the operation of state 
     trading enterprises and such other mechanisms; and
       (ii) ending discriminatory pricing practices for 
     agricultural commodities that amount to de facto export 
     subsidies so that the enterprises or other mechanisms do not 
     (except in cases of bona fide food aid) sell agricultural 
     commodities in foreign markets at prices below domestic 
     market prices or prices below the full costs of acquiring and 
     delivering agricultural commodities to the foreign markets;
       (B) unjustified trade restrictions or commercial 
     requirements affecting new agricultural technologies, 
     including biotechnology;
       (C) unjustified sanitary or phytosanitary restrictions, 
     including restrictions that are not based on scientific 
     principles, in contravention of the Agreement on the 
     Application of Sanitary and Phytosanitary Measures (as 
     described in section 101(d)(3) of the Uruguay Round 
     Agreements Act (19 U.S.C. 3511(d)(3)));
       (D) other unjustified technical barriers to agricultural 
     trade; and
       (E) restrictive and nontransparent rules in the 
     administration of tariff rate quotas;
       (5) improving import relief mechanisms to recognize the 
     unique characteristics of perishable agricultural 
     commodities;
       (6) taking into account whether a party to negotiations 
     with respect to trading in an agricultural commodity has--
       (A) failed to adhere to the provisions of an existing 
     bilateral trade agreement with the United States;
       (B) circumvented obligations under a multilateral trade 
     agreement to which the United States is a signatory; or
       (C) manipulated its currency value to the detriment of 
     United States agricultural producers or exporters; and
       (7) otherwise ensuring that countries that accede to the 
     World Trade Organization--
       (A) have made meaningful market liberalization commitments 
     in agriculture; and
       (B) make progress in fulfilling those commitments over 
     time.
       (b) Priority for Agriculture Trade.--It is the sense of the 
     Senate that--
       (1) reaching a successful agreement on agriculture should 
     be the top priority of United States negotiators in World 
     Trade Organization talks; and
       (2) if the primary export competitors of the United States 
     fail to reduce their trade distorting domestic supports and 
     eliminate export subsidies in accordance with the negotiating 
     objectives expressed in this section, the United States 
     should take steps to increase the leverage of United States 
     negotiators and level the playing field for United States 
     producers, within existing World Trade Organization 
     commitments.
       (c) Consultation With Congressional Committees.--It is the 
     sense of the Senate that--
       (1) before the United States Trade Representative 
     negotiates a trade agreement that would reduce tariffs on 
     agricultural commodities or require a change in United States 
     agricultural law, the United States Trade Representative 
     should consult with the Committee on Agriculture and the 
     Committee on Ways and Means of the House of Representatives 
     and the Committee on Agriculture, Nutrition, and Forestry and 
     the Committee on Finance of the Senate;
       (2) not less than 48 hours before initialing an agreement 
     relating to agricultural trade negotiated under the auspices 
     of the World Trade Organization, the United States Trade 
     Representative should consult closely with the committees 
     referred to in paragraph (1) regarding--
       (A) the details of the agreement;
       (B) the potential impact of the agreement on United States 
     agricultural producers; and
       (C) any changes in United States law necessary to implement 
     the agreement; and
       (3) any agreement or other understanding (whether verbal or 
     in writing) that relates to agricultural trade that is not 
     disclosed to Congress before legislation implementing a trade 
     agreement is introduced in either the Senate or the House of 
     Representatives should not be considered to be part of the 
     agreement approved by Congress and should have no force and 
     effect under Unites States law or in any dispute settlement 
     body.
                      TITLE IV--NUTRITION PROGRAMS

     SEC. 4001. SHORT TITLE.

       This title may be cited as the ``Food Stamp Reauthorization 
     Act of 2002''.
                     Subtitle A--Food Stamp Program

     SEC. 4101. ENCOURAGEMENT OF PAYMENT OF CHILD SUPPORT.

       (a) Exclusion.--Section 5(d)(6) of the Food Stamp Act of 
     1977 (7 U.S.C. 2014(d)(6)) is amended by adding at the end 
     the following: ``and child support payments made by a 
     household member to or for an individual who is not a member 
     of the household if the household member is legally obligated 
     to make the payments,''.
       (b) Simplified Procedure.--Section 5 of the Food Stamp Act 
     of 1977 (7 U.S.C. 2014) is amended--
       (1) in subsection (e), by striking paragraph (4) and 
     inserting the following:
       ``(4) Deduction for child support payments.--

[[Page H1841]]

       ``(A) In general.--In lieu of providing an exclusion for 
     legally obligated child support payments made by a household 
     member under subsection (d)(6), a State agency may elect to 
     provide a deduction for the amount of the payments.
       ``(B) Order of determining deductions.--A deduction under 
     this paragraph shall be determined before the computation of 
     the excess shelter expense deduction under paragraph (6).''; 
     and
       (2) by adding at the end the following:
       ``(n) State Options To Simplify Determination of Child 
     Support Payments.--Regardless of whether a State agency 
     elects to provide a deduction under subsection (e)(4), the 
     Secretary shall establish simplified procedures to allow 
     State agencies, at the option of the State agencies, to 
     determine the amount of any legally obligated child support 
     payments made, including procedures to allow the State agency 
     to rely on information from the agency responsible for 
     implementing the program under part D of title IV of the 
     Social Security Act (42 U.S.C. 651 et seq.) concerning 
     payments made in prior months in lieu of obtaining current 
     information from the households.''.

     SEC. 4102. SIMPLIFIED DEFINITION OF INCOME.

       Section 5(d) of the Food Stamp Act of 1977 (7 U.S.C. 
     2014(d)) is amended--
       (1) by striking ``and (15)'' and inserting ``(15)''; and
       (2) by inserting before the period at the end the 
     following: ``, (16) at the option of the State agency, any 
     educational loans on which payment is deferred, grants, 
     scholarships, fellowships, veterans' educational benefits, 
     and the like (other than loans, grants, scholarships, 
     fellowships, veterans' educational benefits, and the like 
     excluded under paragraph (3)), to the extent that they are 
     required to be excluded under title XIX of the Social 
     Security Act (42 U.S.C. 1396 et seq.), (17) at the option 
     of the State agency, any State complementary assistance 
     program payments that are excluded for the purpose of 
     determining eligibility for medical assistance under 
     section 1931 of the Social Security Act (42 U.S.C. 1396u-
     1), and (18) at the option of the State agency, any types 
     of income that the State agency does not consider when 
     determining eligibility for (A) cash assistance under a 
     program funded under part A of title IV of the Social 
     Security Act (42 U.S.C. 601 et seq.) or the amount of such 
     assistance, or (B) medical assistance under section 1931 
     of the Social Security Act (42 U.S.C. 1396u-1), except 
     that this paragraph does not authorize a State agency to 
     exclude wages or salaries, benefits under title I, II, IV, 
     X, XIV, or XVI of the Social Security Act (42 U.S.C. 301 
     et seq.), regular payments from a government source (such 
     as unemployment benefits and general assistance), worker's 
     compensation, child support payments made to a household 
     member by an individual who is legally obligated to make 
     the payments, or such other types of income the 
     consideration of which the Secretary determines by 
     regulation to be essential to equitable determinations of 
     eligibility and benefit levels''.

     SEC. 4103. STANDARD DEDUCTION.

       Section 5(e) of the Food Stamp Act of 1977 (7 U.S.C. 
     2014(e)) is amended by striking paragraph (1) and inserting 
     the following:
       ``(1) Standard deduction.--
       ``(A) In general.--
       ``(i) Deduction.--The Secretary shall allow a standard 
     deduction for each household in the 48 contiguous States and 
     the District of Columbia, Alaska, Hawaii, and the Virgin 
     Islands of the United States in an amount that is--

       ``(I) equal to 8.31 percent of the income standard of 
     eligibility established under subsection (c)(1); but
       ``(II) not more than 8.31 percent of the income standard of 
     eligibility established under subsection (c)(1) for a 
     household of 6 members.

       ``(ii) Minimum amount.--Notwithstanding clause (i), the 
     standard deduction for each household in the 48 contiguous 
     States and the District of Columbia, Alaska, Hawaii, and the 
     Virgin Islands of the United States shall be not less than 
     $134, $229, $189, and $118, respectively.
       ``(B) Guam.--
       ``(i) In general.--The Secretary shall allow a standard 
     deduction for each household in Guam in an amount that is--

       ``(I) equal to 8.31 percent of twice the income standard of 
     eligibility established under subsection (c)(1) for the 48 
     contiguous States and the District of Columbia; but
       ``(II) not more than 8.31 percent of twice the income 
     standard of eligibility established under subsection (c)(1) 
     for the 48 contiguous States and the District of Columbia for 
     a household of 6 members.

       ``(ii) Minimum amount.--Notwithstanding clause (i), the 
     standard deduction for each household in Guam shall be not 
     less than $269.''.

     SEC. 4104. SIMPLIFIED UTILITY ALLOWANCE.

       Section 5(e)(7)(C)(iii) of the Food Stamp Act of 1977 (7 
     U.S.C. 2014(e)(7)(C)(iii)) is amended--
       (1) in subclause (I)(bb), by inserting ``(without regard to 
     subclause (III))'' after ``Secretary finds''; and
       (2) by adding at the end the following:

       ``(III) Inapplicability of certain restrictions.--Clauses 
     (ii)(II) and (ii)(III) shall not apply in the case of a State 
     agency that has made the use of a standard utility allowance 
     mandatory under subclause (I).''.

     SEC. 4105. SIMPLIFIED DETERMINATION OF HOUSING COSTS.

       (a) In General.--Section 5(e)(7) of the Food Stamp Act of 
     1977 (7 U.S.C. 2014(e)(7)) is amended by adding at the end 
     the following:
       ``(D) Homeless households.--
       ``(i) Alternative deduction.--In lieu of the deduction 
     provided under subparagraph (A), a State agency may elect to 
     allow a household in which all members are homeless 
     individuals, but that is not receiving free shelter 
     throughout the month, to receive a deduction of $143 per 
     month.
       ``(ii) Ineligibility.--The State agency may make a 
     household with extremely low shelter costs ineligible for the 
     alternative deduction under clause (i).''.
       (b) Conforming Amendments.--Section 5 of the Food Stamp Act 
     of 1977 (7 U.S.C. 2014) is amended--
       (1) in subsection (e)--
       (A) by striking paragraph (5); and
       (B) by redesignating paragraphs (6) and (7) as paragraphs 
     (5) and (6), respectively; and
       (2) in subsection (k)(4)(B), by striking ``subsection 
     (e)(7)'' and inserting ``subsection (e)(6)''.

     SEC. 4106. SIMPLIFIED DETERMINATION OF DEDUCTIONS.

       Section 5(f)(1) of the Food Stamp Act of 1977 (7 U.S.C. 
     2014(f)(1)) is amended by adding at the end the following:
       ``(C) Simplified determination of deductions.--
       ``(i) In general.--Except as provided in clause (ii), for 
     the purposes of subsection (e), a State agency may elect to 
     disregard until the next recertification of eligibility under 
     section 11(e)(4) 1 or more types of changes in the 
     circumstances of a household that affect the amount of 
     deductions the household may claim under subsection (e).
       ``(ii) Changes that may not be disregarded.--Under clause 
     (i), a State agency may not disregard--

       ``(I) any reported change of residence; or
       ``(II) under standards prescribed by the Secretary, any 
     change in earned income.''.

     SEC. 4107. SIMPLIFIED DEFINITION OF RESOURCES.

       Section 5(g) of the Food Stamp Act of 1977 (7 U.S.C. 
     2014(g)) is amended--
       (1) in paragraph (1), by striking ``a member who is 60 
     years of age or older'' and inserting ``an elderly or 
     disabled member''; and
       (2) by adding at the end the following:
       ``(6) Exclusion of types of financial resources not 
     considered under certain other federal programs.--
       ``(A) In general.--Subject to subparagraph (B), a State 
     agency may, at the option of the State agency, exclude from 
     financial resources under this subsection any types of 
     financial resources that the State agency does not consider 
     when determining eligibility for--
       ``(i) cash assistance under a program funded under part A 
     of title IV of the Social Security Act (42 U.S.C. 601 et 
     seq.); or
       ``(ii) medical assistance under section 1931 of the Social 
     Security Act (42 U.S.C. 1396u-1).
       ``(B) Limitations.--Except to the extent that any of the 
     types of resources specified in clauses (i) through (iv) are 
     excluded under another paragraph of this subsection, 
     subparagraph (A) does not authorize a State agency to 
     exclude--
       ``(i) cash;
       ``(ii) licensed vehicles;
       ``(iii) amounts in any account in a financial institution 
     that are readily available to the household; or
       ``(iv) any other similar type of resource the inclusion in 
     financial resources of which the Secretary determines by 
     regulation to be essential to equitable determinations of 
     eligibility under the food stamp program.''.

     SEC. 4108. ALTERNATIVE ISSUANCE SYSTEMS IN DISASTERS.

       (a) In General.--Section 5(h)(3)(B) of the Food Stamp Act 
     of 1977 (7 U.S.C. 2014(h)(3)(B)) is amended--
       (1) in the first sentence, by inserting ``issuance methods 
     and'' after ``shall adjust''; and
       (2) in the second sentence, by inserting ``, any conditions 
     that make reliance on electronic benefit transfer systems 
     described in section 7(i) impracticable,'' after 
     ``personnel''.
       (b) Effective Date.--The amendments made by this section 
     take effect on the date of enactment of this Act.

     SEC. 4109. STATE OPTION TO REDUCE REPORTING REQUIREMENTS.

       Section 6(c)(1) of the Food Stamp Act of 1977 (7 U.S.C. 
     2015(c)(1)) is amended--
       (1) in subparagraph (B), by striking ``on a monthly 
     basis''; and
       (2) by adding at the end the following:
       ``(D) Frequency of reporting.--
       ``(i) In general.--Except as provided in subparagraphs (A) 
     and (C), a State agency may require households that report on 
     a periodic basis to submit reports--

       ``(I) not less often than once each 6 months; but
       ``(II) not more often than once each month.

       ``(ii) Reporting by households with excess income.--A 
     household required to report less often than once each 3 
     months shall, notwithstanding subparagraph (B), report in a 
     manner prescribed by the Secretary if the income of the 
     household for any month exceeds the income standard of 
     eligibility established under section 5(c)(2).''.

     SEC. 4110. COST NEUTRALITY FOR ELECTRONIC BENEFIT TRANSFER 
                   SYSTEMS.

       Section 7(i)(2) of the Food Stamp Act of 1977 (7 U.S.C. 
     2016(i)(2)) is amended--
       (1) by striking subparagraph (A); and
       (2) by redesignating subparagraphs (B) through (I) as 
     subparagraphs (A) through (H), respectively.

     SEC. 4111. REPORT ON ELECTRONIC BENEFIT TRANSFER SYSTEMS.

       (a) Definition of EBT System.--In this section, the term 
     ``EBT system'' means an electronic benefit transfer system 
     used in issuance of benefits under the food stamp program 
     under the Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.).
       (b) Report.--Not later than October 1, 2003, the Secretary 
     of Agriculture shall submit to the Committee on Agriculture 
     of the House of Representatives and the Committee on 
     Agriculture,

[[Page H1842]]

     Nutrition, and Forestry of the Senate a report that--
       (1) describes the status of use by each State agency of EBT 
     systems;
       (2) specifies the number of vendors that have entered into 
     a contract for an EBT system with a State agency;
       (3)(A) specifies the number of State agencies that have 
     entered into an EBT-system contract with multiple EBT-system 
     vendors; and
       (B) describes, for each State agency described in 
     subparagraph (A), how responsibilities are divided among the 
     various vendors;
       (4) with respect to any State in which an EBT system is not 
     operational throughout the State as of October 1, 2002--
       (A) provides an explanation of the reasons why an EBT 
     system is not operational throughout the State;
       (B) describes how the reasons are being addressed; and
       (C) specifies the expected date of operation of an EBT 
     system throughout the State;
       (5) provides a description of--
       (A) the issues faced by any State agency that has awarded a 
     second EBT-system contract in the 2-year period preceding the 
     date of the report; and
       (B) the steps that the State agency has taken to address 
     those issues;
       (6) provides a description of--
       (A) the issues faced by any State agency that will award a 
     second EBT-system contract within the 2-year period beginning 
     on the date of the report; and
       (B) strategies that the State agency is considering to 
     address those issues;
       (7) describes initiatives being considered or taken by the 
     Department of Agriculture, food retailers, EBT-system 
     vendors, and client advocates to address any outstanding 
     issues with respect to EBT systems; and
       (8) examines areas of potential advances in electronic 
     benefit delivery in the 5- to 10-year period beginning on the 
     date of the report, including--
       (A) access to EBT systems at farmers' markets;
       (B) increased use of transaction data from EBT systems to 
     identify and prosecute fraud; and
       (C) fostering of increased competition among EBT-system 
     vendors to ensure cost containment and optimal service.

     SEC. 4112. ALTERNATIVE PROCEDURES FOR RESIDENTS OF CERTAIN 
                   GROUP FACILITIES.

       (a) In General.--Section 8 of the Food Stamp Act of 1977 (7 
     U.S.C. 2017) is amended by adding at the end the following:
       ``(f) Alternative Procedures for Residents of Certain Group 
     Facilities.--
       ``(1) In general.--
       ``(A) Applicability.--
       ``(i) In general.--Subject to clause (ii), at the option of 
     the State agency, allotments for residents of any facility 
     described in subparagraph (B), (C), (D), or (E) of section 
     3(i)(5) (referred to in this subsection as a `covered 
     facility') may be determined and issued under this paragraph 
     in lieu of subsection (a).
       ``(ii) Limitation.--Unless the Secretary authorizes 
     implementation of this paragraph in all States under 
     paragraph (3), clause (i) shall apply only to residents of 
     covered facilities participating in a pilot project under 
     paragraph (2).
       ``(B) Amount of allotment.--The allotment for each eligible 
     resident described in subparagraph (A) shall be calculated in 
     accordance with standardized procedures established by the 
     Secretary that take into account the allotments typically 
     received by residents of covered facilities.
       ``(C) Issuance of allotment.--
       ``(i) In general.--The State agency shall issue an 
     allotment determined under this paragraph to a covered 
     facility as the authorized representative of the residents of 
     the covered facility.
       ``(ii) Adjustment.--The Secretary shall establish 
     procedures to ensure that a covered facility does not receive 
     a greater proportion of a resident's monthly allotment than 
     the proportion of the month during which the resident lived 
     in the covered facility.
       ``(D) Departures of residents of covered facilities.--
       ``(i) Notification.--Any covered facility that receives an 
     allotment for a resident under this paragraph shall--

       ``(I) notify the State agency promptly on the departure of 
     the resident; and
       ``(II) notify the resident, before the departure of the 
     resident, that the resident--

       ``(aa) is eligible for continued benefits under the food 
     stamp program; and
       ``(bb) should contact the State agency concerning 
     continuation of the benefits.
       ``(ii) Issuance to departed residents.--On receiving a 
     notification under clause (i)(I) concerning the departure of 
     a resident, the State agency--

       ``(I) shall promptly issue the departed resident an 
     allotment for the days of the month after the departure of 
     the resident (calculated in a manner prescribed by the 
     Secretary) unless the departed resident reapplies to 
     participate in the food stamp program; and
       ``(II) may issue an allotment for the month following the 
     month of the departure (but not any subsequent month) based 
     on this paragraph unless the departed resident reapplies to 
     participate in the food stamp program.

       ``(iii) State option.--The State agency may elect not to 
     issue an allotment under clause (ii)(I) if the State agency 
     lacks sufficient information on the location of the departed 
     resident to provide the allotment.
       ``(iv) Effect of reapplication.--If the departed resident 
     reapplies to participate in the food stamp program, the 
     allotment of the departed resident shall be determined 
     without regard to this paragraph.
       ``(2) Pilot projects.--
       ``(A) In general.--Before the Secretary authorizes 
     implementation of paragraph (1) in all States, the Secretary 
     shall carry out, at the request of 1 or more State agencies 
     and in 1 or more areas of the United States, such number of 
     pilot projects as the Secretary determines to be sufficient 
     to test the feasibility of determining and issuing allotments 
     to residents of covered facilities under paragraph (1) in 
     lieu of subsection (a).
       ``(B) Project plan.--To be eligible to participate in a 
     pilot project under subparagraph (A), a State agency shall 
     submit to the Secretary for approval a project plan that 
     includes--
       ``(i) a specification of the covered facilities in the 
     State that will participate in the pilot project;
       ``(ii) a schedule for reports to be submitted to the 
     Secretary on the pilot project;
       ``(iii) procedures for standardizing allotment amounts that 
     takes into account the allotments typically received by 
     residents of covered facilities; and
       ``(iv) a commitment to carry out the pilot project in 
     compliance with the requirements of this subsection other 
     than paragraph (1)(B).
       ``(3) Authorization of implementation in all states.--
       ``(A) In general.--The Secretary shall--
       ``(i) determine whether to authorize implementation of 
     paragraph (1) in all States; and
       ``(ii) notify the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate of the determination.
       ``(B) Determination not to authorize implementation in all 
     states.--
       ``(i) In general.--If the Secretary makes a finding 
     described in clause (ii), the Secretary--

       ``(I) shall not authorize implementation of paragraph (1) 
     in all States; and
       ``(II) shall terminate all pilot projects under paragraph 
     (2) within a reasonable period of time (as determined by the 
     Secretary).

       ``(ii) Finding.--The finding referred to in clause (i) is 
     that--

       ``(I) an insufficient number of project plans that the 
     Secretary determines to be eligible for approval are 
     submitted by State agencies under paragraph (2)(B); or
       ``(II)(aa) a sufficient number of pilot projects have been 
     carried out under paragraph (2)(A); and
       ``(bb) authorization of implementation of paragraph (1) in 
     all States is not in the best interest of the food stamp 
     program.''.

       (b) Conforming Amendments.--
       (1) Section 3(i) of the Food Stamp Act of 1977 (7 U.S.C. 
     2012(i)) is amended--
       (A) by striking ``(i) `Household' means (1) an'' and 
     inserting the following:
       ``(i)(1) `Household' means--
       ``(A) an'';
       (B) in the first sentence, by striking ``others, or (2) a 
     group'' and inserting the following: ``others; or
       ``(B) a group'';
       (C) in the second sentence, by striking ``Spouses'' and 
     inserting the following:
       ``(2) Spouses'';
       (D) in the third sentence, by striking ``Notwithstanding'' 
     and inserting the following:
       ``(3) Notwithstanding'';
       (E) in paragraph (3) (as designated by subparagraph (D)), 
     by striking ``the preceding sentences'' and inserting 
     ``paragraphs (1) and (2)'';
       (F) in the fourth sentence, by striking ``In no event'' and 
     inserting the following:
       ``(4) In no event'';
       (G) in the fifth sentence, by striking ``For the purposes 
     of this subsection, residents'' and inserting the following:
       ``(5) For the purposes of this subsection, the following 
     persons shall not be considered to be residents of 
     institutions and shall be considered to be individual 
     households:
       ``(A) Residents''; and
       (H) in paragraph (5) (as designated by subparagraph (G))--
       (i) by striking ``Act, or are individuals'' and inserting 
     the following: ``Act.
       ``(B) Individuals'';
       (ii) by striking ``such section, temporary'' and inserting 
     the following: ``that section.
       ``(C) Temporary'';
       (iii) by striking ``children, residents'' and inserting the 
     following: ``children.
       ``(D) Residents'';
       (iv) by striking ``coupons, and narcotics'' and inserting 
     the following: ``coupons.
       ``(E) Narcotics''; and
       (v) by striking ``shall not'' and all that follows and 
     inserting a period.
       (2) Section 5(a) of the Food Stamp Act of 1977 (7 U.S.C. 
     2014(a)) is amended by striking ``the third sentence of 
     section 3(i)'' each place it appears and inserting ``section 
     3(i)(4)''.
       (3) Section 8(e)(1) of the Food Stamp Act of 1977 (7 U.S.C. 
     2017(e)(1)) is amended by striking ``the last sentence of 
     section 3(i)'' and inserting ``section 3(i)(5)''.
       (4) Section 17(b)(1)(B)(iv)(III)(aa) of the Food Stamp Act 
     of 1977 (7 U.S.C. 2026(b)(1)(B)(iv)(III)(aa)) is amended by 
     striking ``the last 2 sentences of section 3(i)'' and 
     inserting ``paragraphs (4) and (5) of section 3(i)''.

     SEC. 4113. REDEMPTION OF BENEFITS THROUGH GROUP LIVING 
                   ARRANGEMENTS.

       (a) In General.--Section 10 of the Food Stamp Act of 1977 
     (7 U.S.C. 2019) is amended by inserting after the first 
     sentence the following: ``Notwithstanding the preceding 
     sentence, a center, organization, institution, shelter, group 
     living arrangement, or establishment described in that 
     sentence may be authorized to redeem coupons through a 
     financial institution described in that sentence if the 
     center, organization, institution, shelter, group living 
     arrangement, or establishment is equipped with 1 or more 
     point-of-sale devices and is operating in an area in which an 
     electronic benefit transfer system described in section 7(i) 
     has been implemented.''.

[[Page H1843]]

       (b) Effective Date.--The amendment made by this section 
     takes effect on the date of enactment of this Act.

     SEC. 4114. AVAILABILITY OF FOOD STAMP PROGRAM APPLICATIONS ON 
                   THE INTERNET.

       (a) In General.--Section 11(e)(2)(B)(ii) of the Food Stamp 
     Act of 1977 (7 U.S.C. 2020(e)(2)(B)(ii)) is amended--
       (1) by inserting ``(I)'' after ``(ii)'';
       (2) in subclause (I) (as designated by paragraph (1)), by 
     adding ``and'' at the end; and
       (3) by adding at the end the following:
       ``(II) if the State agency maintains a website for the 
     State agency, shall make the application available on the 
     website in each language in which the State agency makes a 
     printed application available;''.
       (b) Effective Date.--The amendments made by this section 
     take effect 18 months after the date of enactment of this 
     Act.

     SEC. 4115. TRANSITIONAL FOOD STAMPS FOR FAMILIES MOVING FROM 
                   WELFARE.

       (a) In General.--Section 11 of the Food Stamp Act of 1977 
     (7 U.S.C. 2020) is amended by adding at the end the 
     following:
       ``(s) Transitional Benefits Option.--
       ``(1) In general.--A State agency may provide transitional 
     food stamp benefits to a household that ceases to receive 
     cash assistance under a State program funded under part A of 
     title IV of the Social Security Act (42 U.S.C. 601 et seq.).
       ``(2) Transitional benefits period.--Under paragraph (1), a 
     household may receive transitional food stamp benefits for a 
     period of not more than 5 months after the date on which cash 
     assistance is terminated.
       ``(3) Amount of benefits.--During the transitional benefits 
     period under paragraph (2), a household shall receive an 
     amount of food stamp benefits equal to the allotment received 
     in the month immediately preceding the date on which cash 
     assistance was terminated, adjusted for the change in 
     household income as a result of--
       ``(A) the termination of cash assistance; and
       ``(B) at the option of the State agency, information from 
     another program in which the household participates.
       ``(4) Determination of future eligibility.--In the final 
     month of the transitional benefits period under paragraph 
     (2), the State agency may--
       ``(A) require the household to cooperate in a 
     recertification of eligibility; and
       ``(B) initiate a new certification period for the household 
     without regard to whether the preceding certification period 
     has expired.
       ``(5) Limitation.--A household shall not be eligible for 
     transitional benefits under this subsection if the 
     household--
       ``(A) loses eligibility under section 6;
       ``(B) is sanctioned for a failure to perform an action 
     required by Federal, State, or local law relating to a cash 
     assistance program described in paragraph (1); or
       ``(C) is a member of any other category of households 
     designated by the State agency as ineligible for transitional 
     benefits.
       ``(6) Applications for recertification.--
       ``(A) In general.--A household receiving transitional 
     benefits under this subsection may apply for recertification 
     at any time during the transitional benefits period under 
     paragraph (2).
       ``(B) Determination of allotment.--If a household applies 
     for recertification under subparagraph (A), the allotment of 
     the household for all subsequent months shall be determined 
     without regard to this subsection.''.
       (b) Conforming Amendments.--
       (1) Section 3(c) of the Food Stamp Act of 1977 (7 U.S.C. 
     2012(c)) is amended by adding at the end the following: ``The 
     limits specified in this subsection may be extended until the 
     end of any transitional benefit period established under 
     section 11(s).''.
       (2) Section 6(c) of the Food Stamp Act of 1977 (7 U.S.C. 
     2015(c)) is amended by striking ``No household'' and 
     inserting ``Except in a case in which a household is 
     receiving transitional benefits during the transitional 
     benefits period under section 11(s), no household''.

     SEC. 4116. GRANTS FOR SIMPLE APPLICATION AND ELIGIBILITY 
                   DETERMINATION SYSTEMS AND IMPROVED ACCESS TO 
                   BENEFITS.

       (a) In General.--Section 11 of the Food Stamp Act of 1977 
     (7 U.S.C. 2020) (as amended by section 4115(a)) is amended by 
     adding at the end the following:
       ``(t) Grants for Simple Application and Eligibility 
     Determination Systems and Improved Access to Benefits.--
       ``(1) In general.--For each of fiscal years 2003 through 
     2007, the Secretary shall use not more than $5,000,000 of 
     funds made available under section 18(a)(1) to make grants to 
     pay 100 percent of the costs of eligible entities approved by 
     the Secretary to carry out projects to develop and 
     implement--
       ``(A) simple food stamp application and eligibility 
     determination systems; or
       ``(B) measures to improve access to food stamp benefits by 
     eligible households.
       ``(2) Types of projects.--A project under paragraph (1) may 
     consist of--
       ``(A) coordinating application and eligibility 
     determination processes, including verification practices, 
     under the food stamp program and other Federal, State, and 
     local assistance programs;
       ``(B) establishing methods for applying for benefits and 
     determining eligibility that--
       ``(i) more extensively use--

       ``(I) communications by telephone; and
       ``(II) electronic alternatives such as the Internet; or

       ``(ii) otherwise improve the administrative infrastructure 
     used in processing applications and determining eligibility;
       ``(C) developing procedures, training materials, and other 
     resources aimed at reducing barriers to participation and 
     reaching eligible households;
       ``(D) improving methods for informing and enrolling 
     eligible households; or
       ``(E) carrying out such other activities as the Secretary 
     determines to be appropriate.
       ``(3) Limitation.--A grant under this subsection shall not 
     be made for the ongoing cost of carrying out any project.
       ``(4) Eligible entities.--To be eligible to receive a grant 
     under this subsection, an entity shall be--
       ``(A) a State agency administering the food stamp program;
       ``(B) a State or local government;
       ``(C) an agency providing health or welfare services;
       ``(D) a public health or educational entity; or
       ``(E) a private nonprofit entity such as a community-based 
     organization, food bank, or other emergency feeding 
     organization.
       ``(5) Selection of eligible entities.--The Secretary--
       ``(A) shall develop criteria for the selection of eligible 
     entities to receive grants under this subsection; and
       ``(B) may give preference to any eligible entity that 
     consists of a partnership between a governmental entity and a 
     nongovernmental entity.''.
       (b) Conforming Amendments.--Section 17 of the Food Stamp 
     Act of 1977 (7 U.S.C. 2026) is amended--
       (1) by striking subsection (i); and
       (2) by redesignating subsections (j) and (k) as subsections 
     (i) and (j), respectively.

     SEC. 4117. DELIVERY TO RETAILERS OF NOTICES OF ADVERSE 
                   ACTION.

       (a) In General.--Section 14(a) of the Food Stamp Act of 
     1977 (7 U.S.C. 2023(a)) is amended by striking paragraph (2) 
     and inserting the following:
       ``(2) Delivery of notices.--A notice under paragraph (1) 
     shall be delivered by any form of delivery that the Secretary 
     determines will provide evidence of the delivery.''.
       (b) Effective Date.--The amendment made by this section 
     takes effect on the date of enactment of this Act.

     SEC. 4118. REFORM OF QUALITY CONTROL SYSTEM.

       (a) In General.--Section 16(c) of the Food Stamp Act of 
     1977 (7 U.S.C. 2025(c)) is amended--
       (1) by striking ``(c)(1) The program'' and all that follows 
     through the end of paragraph (1) and inserting the following:
       ``(c) Quality Control System.--
       ``(1) In general.--
       ``(A) System.--In carrying out the food stamp program, the 
     Secretary shall carry out a system that enhances payment 
     accuracy and improves administration by establishing fiscal 
     incentives that require State agencies with high payment 
     error rates to share in the cost of payment error.
       ``(B) Adjustment of federal share of administrative costs 
     for fiscal years before fiscal year 2003.--
       ``(i) In general.--Subject to clause (ii), with respect to 
     any fiscal year before fiscal year 2003, the Secretary shall 
     adjust a State agency's federally funded share of 
     administrative costs under subsection (a), other than the 
     costs already shared in excess of 50 percent under the 
     proviso in the first sentence of subsection (a) or under 
     subsection (g), by increasing that share of all such 
     administrative costs by 1 percentage point to a maximum of 60 
     percent of all such administrative costs for each full \1/10\ 
     of a percentage point by which the payment error rate is less 
     than 6 percent.
       ``(ii) Limitation.--Only States with a rate of invalid 
     decisions in denying eligibility that is less than a 
     nationwide percentage that the Secretary determines to be 
     reasonable shall be entitled to the adjustment under clause 
     (i).
       ``(C) Establishment of liability amount for fiscal year 
     2003 and thereafter.--With respect to fiscal year 2004 and 
     any fiscal year thereafter for which the Secretary determines 
     that, for the second or subsequent consecutive fiscal year, a 
     95 percent statistical probability exists that the payment 
     error rate of a State agency exceeds 105 percent of the 
     national performance measure for payment error rates 
     announced under paragraph (6), the Secretary shall establish 
     an amount for which the State agency may be liable (referred 
     to in this paragraph as the `liability amount') that is equal 
     to the product obtained by multiplying--
       ``(i) the value of all allotments issued by the State 
     agency in the fiscal year;
       ``(ii) the difference between--

       ``(I) the payment error rate of the State agency; and
       ``(II) 6 percent; and

       ``(iii) 10 percent.
       ``(D) Authority of secretary with respect to liability 
     amount.--With respect to the liability amount established for 
     a State agency under subparagraph (C) for any fiscal year, 
     the Secretary shall--
       ``(i)(I) waive the responsibility of the State agency to 
     pay all or any portion of the liability amount established 
     for the fiscal year (referred to in this paragraph as the 
     `waiver amount');
       ``(II) require that a portion, not to exceed 50 percent, of 
     the liability amount established for the fiscal year be used 
     by the State agency for new investment, approved by the 
     Secretary, to improve administration by the State agency of 
     the food stamp program (referred to in this paragraph as the 
     `new investment amount'), which new investment amount shall 
     not be matched by Federal funds;
       ``(III) designate a portion, not to exceed 50 percent, of 
     the amount established for the fiscal year for payment to the 
     Secretary in accordance with subparagraph (E) (referred to in 
     this paragraph as the `at-risk amount'); or
       ``(IV) take any combination of the actions described in 
     subclauses (I) through (III); or
       ``(ii) make the determinations described in clause (i) and 
     enter into a settlement with the

[[Page H1844]]

     State agency, only with respect to any waiver amount or new 
     investment amount, before the end of the fiscal year in which 
     the liability amount is determined under subparagraph (C).
       ``(E) Payment of at-risk amount for certain states.--
       ``(i) In general.--A State agency shall pay to the 
     Secretary the at-risk amount designated under subparagraph 
     (D)(i)(III) for any fiscal year in accordance with clause 
     (ii), if, with respect to the immediately following fiscal 
     year, a liability amount has been established for the State 
     agency under subparagraph (C).
       ``(ii) Method of payment of at-risk amount.--

       ``(I) Remission to the secretary.--In the case of a State 
     agency required to pay an at-risk amount under clause (i), as 
     soon as practicable after completion of all administrative 
     and judicial reviews with respect to that requirement to pay, 
     the chief executive officer of the State shall remit to the 
     Secretary the at-risk amount required to be paid.
       ``(II) Alternative method of collection.--

       ``(aa) In general.--If the chief executive officer of the 
     State fails to make the payment under subclause (I) within a 
     reasonable period of time determined by the Secretary, the 
     Secretary may reduce any amount due to the State agency under 
     any other provision of this section by the amount required to 
     be paid under clause (i).
       ``(bb) Accrual of interest.--During any period of time 
     determined by the Secretary under item (aa), interest on the 
     payment under subclause (I) shall not accrue under section 
     13(a)(2).
       ``(F) Use of portion of liability amount for new 
     investment.--
       ``(i) Reduction of other amounts due to state agency.--In 
     the case of a State agency that fails to comply with a 
     requirement for new investment under subparagraph (D)(i)(II) 
     or clause (iii)(I), the Secretary may reduce any amount due 
     to the State agency under any other provision of this section 
     by the portion of the liability amount that has not been used 
     in accordance with that requirement.
       ``(ii) Effect of state agency's wholly prevailing on 
     appeal.--If a State agency begins required new investment 
     under subparagraph (D)(i)(II), the State agency appeals the 
     liability amount of the State agency, and the determination 
     by the Secretary of the liability amount is reduced to $0 on 
     administrative or judicial review, the Secretary shall pay to 
     the State agency an amount equal to 50 percent of the new 
     investment amount that was included in the liability amount 
     subject to the appeal.
       ``(iii) Effect of secretary's wholly prevailing on 
     appeal.--If a State agency does not begin required new 
     investment under subparagraph (D)(i)(II), the State agency 
     appeals the liability amount of the State agency, and the 
     determination by the Secretary of the liability amount is 
     wholly upheld on administrative or judicial review, the 
     Secretary shall--

       ``(I) require all or any portion of the new investment 
     amount to be used by the State agency for new investment, 
     approved by the Secretary, to improve administration by the 
     State agency of the food stamp program, which amount shall 
     not be matched by Federal funds; and
       ``(II) require payment of any remaining portion of the new 
     investment amount in accordance with subparagraph (E)(ii).

       ``(iv) Effect of neither party's wholly prevailing on 
     appeal.--The Secretary shall promulgate regulations regarding 
     obligations of the Secretary and the State agency in a case 
     in which the State agency appeals the liability amount of the 
     State agency and neither the Secretary nor the State agency 
     wholly prevails.
       ``(G) Corrective action plans.--The Secretary shall foster 
     management improvements by the States by requiring State 
     agencies, other than State agencies with payment error rates 
     of less than 6 percent, to develop and implement corrective 
     action plans to reduce payment errors.'';
       (2) in paragraph (4), by striking ``(4)'' and all that 
     follows through the end of the first sentence and inserting 
     the following:
       ``(4) Reporting requirements.--The Secretary may require a 
     State agency to report any factors that the Secretary 
     considers necessary to determine a State agency's payment 
     error rate, liability amount or new investment amount under 
     paragraph (1), or performance under the performance measures 
     under subsection (d).'';
       (3) in paragraph (5)--
       (A) by striking ``(5)'' and all that follows through the 
     end of the second sentence and inserting the following:
       ``(5) Procedures.--To facilitate the implementation of this 
     subsection, each State agency shall expeditiously submit to 
     the Secretary data concerning the operations of the State 
     agency in each fiscal year sufficient for the Secretary to 
     establish the State agency's payment error rate, liability 
     amount or new investment amount under paragraph (1), or 
     performance under the performance measures under subsection 
     (d).''; and
       (B) in the last sentence, by striking ``paragraph (1)(C)'' 
     and inserting ``paragraph (1)'';
       (4) in paragraph (6)--
       (A) by striking ``(6) At'' and inserting the following:
       ``(6) National performance measure for payment error 
     rates.--
       ``(A) Announcement.--At'';
       (B) in subparagraph (A) (as designated by subparagraph 
     (A)), by striking ``and incentive payments or claims pursuant 
     to paragraphs (1)(A) and (1)(C)'';
       (C) in the first and third sentences, by striking 
     ``paragraph (5)'' each place it appears and inserting 
     ``paragraph (8)'';
       (D) by striking ``Where a State'' and inserting the 
     following:
       ``(B) Use of alternative measure of state error.--Where a 
     State'';
       (E) by striking ``The announced'' and inserting the 
     following:
       ``(C) Use of national performance measure.--The 
     announced'';
       (F) in subparagraph (C) (as designated by subparagraph 
     (E)), by striking ``the State share of the cost of payment 
     error under paragraph (1)(C)'' and inserting ``the liability 
     amount of a State under paragraph (1)(C)''; and
       (G) by adding at the end the following:
       ``(D) No administrative or judicial review.--The national 
     performance measure announced under this paragraph shall not 
     be subject to administrative or judicial review.'';
       (5) in paragraph (7)--
       (A) by striking ``(7) If the Secretary asserts a financial 
     claim against'' and inserting the following:
       ``(7) Administrative and judicial review.--
       ``(A) In general.--Except as provided in subparagraphs (B) 
     and (C), if the Secretary asserts a financial claim against 
     or establishes a liability amount with respect to'';
       (B) in subparagraph (A) (as designated by subparagraph 
     (A)), by striking ``paragraph (1)(C)'' and inserting 
     ``paragraph (1)''; and
       (C) by adding at the end the following:
       ``(B) Determination of payment error rate.--With respect to 
     any fiscal year, a determination of the payment error rate of 
     a State agency or a determination whether the payment error 
     rate exceeds 105 percent of the national performance measure 
     for payment error rates shall be subject to administrative or 
     judicial review only if the Secretary establishes a liability 
     amount with respect to the fiscal year under paragraph 
     (1)(C).
       ``(C) Authority of secretary with respect to liability 
     amount.--An action by the Secretary under subparagraph (D) or 
     (F)(iii) of paragraph (1) shall not be subject to 
     administrative or judicial review.''; and
       (6) in paragraph (8)--
       (A) in subparagraph (A), by striking ``paragraph (1)(C)'' 
     and inserting ``paragraph (1)'';
       (B) in subparagraph (C)--
       (i) in clause (i), by striking ``payment claimed against 
     State agencies; and'' and inserting ``payment claimed against 
     State agencies or liability amount established with respect 
     to State agencies;'';
       (ii) in clause (ii), by striking ``claims.'' and inserting 
     ``claims or liability amounts; and''; and
       (iii) by adding at the end the following:
       ``(iii) provide a copy of the document providing 
     notification under clause (ii) to the chief executive officer 
     and the legislature of the State.''; and
       (C) in subparagraphs (D) and (H), by inserting ``or 
     liability amount'' after ``claim'' each place it appears.
       (b) Authority To Settle Claims Concerning At-Risk 
     Amounts.--Section 13(a) of the Food Stamp Act of 1977 (7 
     U.S.C. 2022(a)) is amended--
       (1) by striking ``(a)(1) The'' and inserting the following:
       ``(a) General Authority of the Secretary.--
       ``(1) Determination of claims.--Except in the case of an 
     at-risk amount required under section 16(c)(1)(D)(i)(III), 
     the'';
       (2) by striking the fourth sentence;
       (3) by striking ``To the extent'' and inserting the 
     following:
       ``(2) Claims established under quality control system.--To 
     the extent'';
       (4) in paragraph (2) (as designated by paragraph (3)), by 
     striking ``section 16(c)(1)(C)'' and inserting ``section 
     16(c)(1)'';
       (5) by striking ``Any interest'' and inserting the 
     following:
       ``(3) Computation of interest.--Any interest''; and
       (6) by striking ``(2) Each adult'' and inserting the 
     following:
       ``(4) Joint and several liability of household members.--
     Each adult''.
       (c) Crediting of Payments to Food Stamp Appropriations 
     Account.--Section 18(e) of the Food Stamp Act of 1977 (7 
     U.S.C. 2027(e)) is amended in the first sentence--
       (1) by striking ``11(g) and (h), and'' and inserting 
     ``subsections (g) and (h) of section 11,''; and
       (2) by inserting ``and section 16(c)(1),'' after ``section 
     13,''.
       (d) Conforming Amendments.--Section 22(h) of the Food Stamp 
     Act of 1977 (7 U.S.C. 2031(h)) is amended--
       (1) in the second sentence, by striking ``section 
     16(c)(1)(C)'' and inserting ``section 16(c)(1)''; and
       (2) by striking the third sentence.
       (e) Applicability.--The amendments made by this section 
     shall not apply with respect to any sanction, appeal, new 
     investment agreement, or other action by the Secretary of 
     Agriculture or a State agency that is based on a payment 
     error rate calculated for any fiscal year before fiscal year 
     2003.

     SEC. 4119. IMPROVEMENT OF CALCULATION OF STATE PERFORMANCE 
                   MEASURES.

       (a) In General.--Section 16(c)(8) of the Food Stamp Act of 
     1977 (7 U.S.C. 2025(c)(8)) is amended--
       (1) in subparagraph (B), by striking ``180 days after the 
     end of the fiscal year'' and inserting ``the first May 31 
     after the end of the fiscal year referred to in subparagraph 
     (A)''; and
       (2) in subparagraph (C), by striking ``30 days thereafter'' 
     and inserting ``the first June 30 after the end of the fiscal 
     year referred to in subparagraph (A)''.
       (b) Effective Date.--The amendments made by this section 
     take effect on the date of enactment of this Act.

     SEC. 4120. BONUSES FOR STATES THAT DEMONSTRATE HIGH OR MOST 
                   IMPROVED PERFORMANCE.

       (a) In General.--Section 16 of the Food Stamp Act of 1977 
     (7 U.S.C. 2025) is amended by striking subsection (d) and 
     inserting the following:

[[Page H1845]]

       ``(d) Bonuses for States That Demonstrate High or Most 
     Improved Performance.--
       ``(1) Fiscal years 2003 and 2004.--
       ``(A) Guidance.--With respect to fiscal years 2003 and 
     2004, the Secretary shall establish, in guidance issued to 
     State agencies not later than October 1, 2002--
       ``(i) performance criteria relating to--

       ``(I) actions taken to correct errors, reduce rates of 
     error, and improve eligibility determinations; and
       ``(II) other indicators of effective administration 
     determined by the Secretary; and

       ``(ii) standards for high and most improved performance to 
     be used in awarding performance bonus payments under 
     subparagraph (B)(ii).
       ``(B) Performance bonus payments.--With respect to each of 
     fiscal years 2003 and 2004, the Secretary shall--
       ``(i) measure the performance of each State agency with 
     respect to the criteria established under subparagraph 
     (A)(i); and
       ``(ii) subject to paragraph (3), award performance bonus 
     payments in the following fiscal year, in a total amount of 
     $48,000,000 for each fiscal year, to State agencies that meet 
     standards for high or most improved performance established 
     by the Secretary under subparagraph (A)(ii).
       ``(2) Fiscal years 2005 and thereafter.--
       ``(A) Regulations.--With respect to fiscal year 2005 and 
     each fiscal year thereafter, the Secretary shall--
       ``(i) establish, by regulation, performance criteria 
     relating to--

       ``(I) actions taken to correct errors, reduce rates of 
     error, and improve eligibility determinations; and
       ``(II) other indicators of effective administration 
     determined by the Secretary;

       ``(ii) establish, by regulation, standards for high and 
     most improved performance to be used in awarding performance 
     bonus payments under subparagraph (B)(ii); and
       ``(iii) before issuing proposed regulations to carry out 
     clauses (i) and (ii), solicit ideas for performance criteria 
     and standards for high and most improved performance from 
     State agencies and organizations that represent State 
     interests.
       ``(B) Performance bonus payments.--With respect to fiscal 
     year 2005 and each fiscal year thereafter, the Secretary 
     shall--
       ``(i) measure the performance of each State agency with 
     respect to the criteria established under subparagraph 
     (A)(i); and
       ``(ii) subject to paragraph (3), award performance bonus 
     payments in the following fiscal year, in a total amount of 
     $48,000,000 for each fiscal year, to State agencies that meet 
     standards for high or most improved performance established 
     by the Secretary under subparagraph (A)(ii).
       ``(3) Prohibition on receipt of performance bonus 
     payments.--A State agency shall not be eligible for a 
     performance bonus payment with respect to any fiscal year for 
     which the State agency has a liability amount established 
     under subsection (c)(1)(C).
       ``(4) Payments not subject to judicial review.--A 
     determination by the Secretary whether, and in what amount, 
     to award a performance bonus payment under this subsection 
     shall not be subject to administrative or judicial review.''.
       (b) Effective Date.--The amendment made by this section 
     takes effect on the date of enactment of this Act.

     SEC. 4121. EMPLOYMENT AND TRAINING PROGRAM.

       (a) Levels of Funding.--Section 16(h)(1) of the Food Stamp 
     Act of 1977 (7 U.S.C. 2025(h)(1)) is amended--
       (1) in subparagraph (A), by striking clause (vii) and 
     inserting the following:
       ``(vii) for each of fiscal years 2002 through 2007, 
     $90,000,000.'';
       (2) by striking subparagraph (B) and inserting the 
     following:
       ``(B) Allocation.--Funds made available under subparagraph 
     (A) shall be made available to and reallocated among State 
     agencies under a reasonable formula that--
       ``(i) is determined and adjusted by the Secretary; and
       ``(ii) takes into account the number of individuals who are 
     not exempt from the work requirement under section 6(o).''; 
     and
       (3) by striking subparagraphs (E) through (G) and inserting 
     the following:
       ``(E) Additional allocations for states that ensure 
     availability of work opportunities.--
       ``(i) In general.--In addition to the allocations under 
     subparagraph (A), from funds made available under section 
     18(a)(1), the Secretary shall allocate not more than 
     $20,000,000 for each of fiscal years 2002 through 2007 to 
     reimburse a State agency that is eligible under clause (ii) 
     for the costs incurred in serving food stamp recipients who--

       ``(I) are not eligible for an exception under section 
     6(o)(3); and
       ``(II) are placed in and comply with a program described in 
     subparagraph (B) or (C) of section 6(o)(2).

       ``(ii) Eligibility.--To be eligible for an additional 
     allocation under clause (i), a State agency shall make and 
     comply with a commitment to offer a position in a program 
     described in subparagraph (B) or (C) of section 6(o)(2) to 
     each applicant or recipient who--

       ``(I) is in the last month of the 3-month period described 
     in section 6(o)(2);
       ``(II) is not eligible for an exception under section 
     6(o)(3);
       ``(III) is not eligible for a waiver under section 6(o)(4); 
     and
       ``(IV) is not exempt under section 6(o)(6).''.

       (b) Carryover Funds.--Notwithstanding any other provision 
     of law, funds provided under section 16(h)(1)(A) of the Food 
     Stamp Act of 1977 (7 U.S.C. 2025(h)(1)(A)) for any fiscal 
     year before fiscal year 2002 shall be rescinded on the date 
     of enactment of this Act, unless obligated by a State agency 
     before that date.
       (c) Participant Expenses.--Section 6(d)(4)(I)(i)(I) of the 
     Food Stamp Act of 1977 (7 U.S.C. 2015(d)(4)(I)(i)(I)) is 
     amended by striking ``, except that the State agency may 
     limit such reimbursement to each participant to $25 per 
     month''.
       (d) Federal Reimbursement.--Section 16(h)(3) of the Food 
     Stamp Act of 1977 (7 U.S.C. 2025(h)(3)) is amended by 
     striking ``such total amount shall not exceed an amount 
     representing $25 per participant per month for costs of 
     transportation and other actual costs (other than dependent 
     care costs) and'' and inserting ``the amount of the 
     reimbursement for dependent care expenses shall not exceed''.
       (e) Effective Date.--The amendments made by this section 
     take effect on the date of enactment of this Act.

     SEC. 4122. REAUTHORIZATION OF FOOD STAMP PROGRAM AND FOOD 
                   DISTRIBUTION PROGRAM ON INDIAN RESERVATIONS.

       (a) Reductions in Payments for Administrative Costs.--
     Section 16(k)(3) of the Food Stamp Act of 1977 (7 U.S.C. 
     2025(k)(3)) is amended--
       (1) in the first sentence of subparagraph (A), by striking 
     ``2002'' and inserting ``2007''; and
       (2) in subparagraph (B)(ii), by striking ``2002'' and 
     inserting ``2007''.
       (b) Cash Payment Pilot Projects.--Section 17(b)(1)(B)(vi) 
     of the Food Stamp Act of 1977 (7 U.S.C. 2026(b)(1)(B)(vi)) is 
     amended by striking ``2002'' and inserting ``2007''.
       (c) Authorization of Appropriations.--Section 18(a)(1) of 
     the Food Stamp Act of 1977 (7 U.S.C. 2027(a)(1)) is amended 
     in the first sentence by striking ``1996 through 2002'' and 
     inserting ``2003 through 2007''.

     SEC. 4123. EXPANDED GRANT AUTHORITY.

       (a) In General.--Section 17(a)(1) of the Food Stamp Act of 
     1977 (7 U.S.C. 2026(a)(1)) is amended--
       (1) by striking ``, by way of making contracts with or 
     grants to public or private organizations or agencies,'' and 
     inserting ``enter into contracts with or make grants to 
     public or private organizations or agencies under this 
     section to''; and
       (2) by adding at the end the following: ``The waiver 
     authority of the Secretary under subsection (b) shall extend 
     to all contracts and grants under this section.''.
       (b) Effective Date.--The amendments made by this section 
     take effect on the date of enactment of this Act.

     SEC. 4124. CONSOLIDATED BLOCK GRANTS FOR PUERTO RICO AND 
                   AMERICAN SAMOA.

       (a) Consolidated Funding.--Section 19 of the Food Stamp Act 
     of 1977 (7 U.S.C. 2028) is amended--
       (1) by striking the section heading and ``(a)(1)(A) From'' 
     and all that follows through ``(2) The'' and inserting the 
     following:

     ``SEC. 19. CONSOLIDATED BLOCK GRANTS FOR PUERTO RICO AND 
                   AMERICAN SAMOA.

       ``(a) Payments to Governmental Entities.--
       ``(1) Definition of governmental entity.--In this 
     subsection, the term `governmental entity' means--
       ``(A) the Commonwealth of Puerto Rico; and
       ``(B) American Samoa.
       ``(2) Block grants.--
       ``(A) Amount of block grants.--From the sums appropriated 
     under this Act, the Secretary shall, subject to this section, 
     pay to governmental entities to pay the expenditures for 
     nutrition assistance programs for needy persons as described 
     in subparagraphs (B) and (C)--
       ``(i) for fiscal year 2003, $1,401,000,000; and
       ``(ii) for each of fiscal years 2004 through 2007, the 
     amount specified in clause (i), as adjusted by the percentage 
     by which the thrifty food plan has been adjusted under 
     section 3(o)(4) between June 30, 2002, and June 30 of the 
     immediately preceding fiscal year.
       ``(B) Payments to commonwealth of puerto rico.--
       ``(i) In general.--For fiscal year 2003 and each fiscal 
     year thereafter, the Secretary shall use 99.6 percent of the 
     funds made available under subparagraph (A) for payment to 
     the Commonwealth of Puerto Rico to pay--

       ``(I) 100 percent of the expenditures by the Commonwealth 
     for the fiscal year for the provision of nutrition assistance 
     included in the plan of the Commonwealth approved under 
     subsection (b); and
       ``(II) 50 percent of the related administrative expenses.

       ``(ii) Exception for expenditures for certain systems.--
     Notwithstanding clause (i), the Commonwealth of Puerto Rico 
     may spend in fiscal year 2002 or 2003 not more than 
     $6,000,000 of the amount required to be paid to the 
     Commonwealth for fiscal year 2002 under this paragraph (as in 
     effect on the day before the date of enactment of this 
     clause) to pay 100 percent of the costs of--

       ``(I) upgrading and modernizing the electronic data 
     processing system used to carry out nutrition assistance 
     programs for needy persons;
       ``(II) implementing systems to simplify the determination 
     of eligibility to receive the nutrition assistance; and
       ``(III) operating systems to deliver the nutrition 
     assistance through electronic benefit transfers.

       ``(C) Payments to american samoa.--For fiscal year 2003 and 
     each fiscal year thereafter, the Secretary shall use 0.4 
     percent of the funds made available under subparagraph (A) 
     for payment to American Samoa to pay 100 percent of the 
     expenditures by American Samoa for a nutrition assistance 
     program extended under section 601(c) of Public Law 96-597 
     (48 U.S.C. 1469d(c)).
       ``(D) Carryover of funds.--For fiscal year 2002 and each 
     fiscal year thereafter, not more

[[Page H1846]]

     than 2 percent of the funds made available under this 
     paragraph for the fiscal year to each governmental entity may 
     be carried over to the following fiscal year.
       ``(3) Time and manner of payments to commonwealth of puerto 
     rico.--The'';
       (2) in subsection (b), by striking ``subsection (a)(1)(A)'' 
     each place it appears and inserting ``subsection (a)(2)(B)''; 
     and
       (3) in subsection (c), by striking ``subsection (a)(1)(A)'' 
     each place it appears and inserting ``subsection (a)(2)(A)''.
       (b) Conforming Amendment.--Section 24 of the Food Stamp Act 
     of 1977 (7 U.S.C. 2033) is repealed.
       (c) Applicability.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section apply beginning on October 1, 
     2002.
       (2) Exceptions.--Subparagraphs (B)(ii) and (D) of section 
     19(a)(2) of the Food Stamp Act of 1977 (as amended by 
     subsection (a)(1)) apply beginning on the date of enactment 
     of this Act.
       (d) Effective Date.--The amendments made by this section 
     take effect on the date of enactment of this Act.

     SEC. 4125. ASSISTANCE FOR COMMUNITY FOOD PROJECTS.

       (a) In General.--Section 25 of the Food Stamp Act of 1977 
     (7 U.S.C. 2034) is amended--
       (1) in subsection (a)--
       (A) by striking ``(1)'' and inserting ``(1)(A)'';
       (B) by redesignating paragraphs (2) and (3) as 
     subparagraphs (B) and (C), respectively, of paragraph (1);
       (C) in paragraph (1)(C) (as redesignated by subparagraph 
     (B)), by striking the period at the end and inserting ``; 
     or''; and
       (D) by adding at the end the following:
       ``(2) meet specific State, local, or neighborhood food and 
     agricultural needs, including needs for--
       ``(A) infrastructure improvement and development;
       ``(B) planning for long-term solutions; or
       ``(C) the creation of innovative marketing activities that 
     mutually benefit agricultural producers and low-income 
     consumers.'';
       (2) in subsection (b)(2)(B)--
       (A) by striking ``$2,500,000'' and inserting 
     ``$5,000,000''; and
       (B) by striking ``2002'' and inserting ``2007'';
       (3) in subsection (d), by striking paragraph (4) and 
     inserting the following:
       ``(4) encourage long-term planning activities, and 
     multisystem, interagency approaches with multistakeholder 
     collaborations, that build the long-term capacity of 
     communities to address the food and agricultural problems of 
     the communities, such as food policy councils and food 
     planning associations.''; and
       (4) by striking subsection (h) and inserting the following:
       ``(h) Innovative Programs for Addressing Common Community 
     Problems.--
       ``(1) In general.--The Secretary shall offer to enter into 
     a contract with, or make a grant to, 1 nongovernmental 
     organization that meets the requirements of paragraph (2) to 
     coordinate with Federal agencies, States, political 
     subdivisions, and nongovernmental organizations (collectively 
     referred to in this subsection as `targeted entities') to 
     gather information, and recommend to the targeted entities, 
     innovative programs for addressing common community problems, 
     including--
       ``(A) loss of farms and ranches;
       ``(B) rural poverty;
       ``(C) welfare dependency;
       ``(D) hunger;
       ``(E) the need for job training; and
       ``(F) the need for self-sufficiency by individuals and 
     communities.
       ``(2) Nongovernmental organization.--The nongovernmental 
     organization referred to in paragraph (1) shall--
       ``(A) be selected by the Secretary on a competitive basis;
       ``(B) be experienced in working with other targeted 
     entities and in organizing workshops that demonstrate 
     programs to other targeted entities;
       ``(C) be experienced in identifying programs that 
     effectively address community problems described in paragraph 
     (1) that can be implemented by other targeted entities;
       ``(D) be experienced in, and capable of, receiving 
     information from and communicating with other targeted 
     entities throughout the United States;
       ``(E) be experienced in operating a national information 
     clearinghouse that addresses 1 or more of the community 
     problems described in paragraph (1); and
       ``(F) as a condition of entering into the contract or 
     receiving the grant referred to in paragraph (1), agree--
       ``(i) to contribute in-kind resources toward implementation 
     of the contract or grant;
       ``(ii) to provide to other targeted entities information 
     and guidance on the innovative programs referred to in 
     paragraph (1); and
       ``(iii) to operate a national information clearinghouse on 
     innovative means for addressing community problems described 
     in paragraph (1) that--

       ``(I) is easily usable by--

       ``(aa) Federal, State, and local government agencies;
       ``(bb) local community leaders;
       ``(cc) nongovernmental organizations; and
       ``(dd) the public; and

       ``(II) includes information on approved community food 
     projects.

       ``(3) Audits; effective use of funds.--The Secretary shall 
     establish auditing procedures and otherwise ensure the 
     effective use of funds made available to carry out this 
     subsection.
       ``(4) Funding.--Not later than 90 days after the date of 
     enactment of this paragraph, and on October 1 of each of 
     fiscal years 2003 through 2007, the Secretary shall allocate 
     to carry out this subsection $200,000 of the funds made 
     available under subsection (b), to remain available until 
     expended.''.
       (b) Effective Date.--The amendments made by this section 
     take effect on the date of enactment of this Act.

     SEC. 4126. AVAILABILITY OF COMMODITIES FOR THE EMERGENCY FOOD 
                   ASSISTANCE PROGRAM.

       (a) In General.--Section 27(a) of the Food Stamp Act of 
     1977 (7 U.S.C. 2036(a)) is amended--
       (1) by striking ``1997 through 2002'' and inserting ``2002 
     through 2007''; and
       (2) by striking ``$100,000,000'' and inserting 
     ``$140,000,000''.
       (b) Effective Date.--The amendments made by this section 
     take effect on October 1, 2001.
                   Subtitle B--Commodity Distribution

     SEC. 4201. COMMODITY SUPPLEMENTAL FOOD PROGRAM.

       (a) Commodity Distribution Program.--Section 4(a) of the 
     Agriculture and Consumer Protection Act of 1973 (7 U.S.C. 
     612c note; Public Law 93-86) is amended in the first sentence 
     by striking ``2002'' and inserting ``2007''.
       (b) Commodity Supplemental Food Program.--Section 5 of the 
     Agriculture and Consumer Protection Act of 1973 (7 U.S.C. 
     612c note; Public Law 93-86) is amended--
       (1) by striking subsection (a) and inserting the following:
       ``(a) Grants Per Assigned Caseload Slot.--
       ``(1) In general.--In carrying out the program under 
     section 4 (referred to in this section as the `commodity 
     supplemental food program'), for each of fiscal years 2003 
     through 2007, the Secretary shall provide to each State 
     agency from funds made available to carry out that section 
     (including any such funds remaining available from the 
     preceding fiscal year), a grant per assigned caseload slot 
     for administrative costs incurred by the State agency and 
     local agencies in the State in operating the commodity 
     supplemental food program.
       ``(2) Amount of grants.--
       ``(A) Fiscal year 2003.--For fiscal year 2003, the amount 
     of each grant per assigned caseload slot shall be equal to 
     the amount of the grant per assigned caseload slot for 
     administrative costs in 2001, adjusted by the percentage 
     change between--
       ``(i) the value of the State and local government price 
     index, as published by the Bureau of Economic Analysis of the 
     Department of Commerce, for the 12-month period ending June 
     30, 2001; and
       ``(ii) the value of that index for the 12-month period 
     ending June 30, 2002.
       ``(B) Fiscal years 2004 through 2007.--For each of fiscal 
     years 2004 through 2007, the amount of each grant per 
     assigned caseload slot shall be equal to the amount of the 
     grant per assigned caseload slot for the preceding fiscal 
     year, adjusted by the percentage change between--
       ``(i) the value of the State and local government price 
     index, as published by the Bureau of Economic Analysis of the 
     Department of Commerce, for the 12-month period ending June 
     30 of the second preceding fiscal year; and
       ``(ii) the value of that index for the 12-month period 
     ending June 30 of the preceding fiscal year.'';
       (2) in subsection (d)(2), by striking ``2002'' each place 
     it appears and inserting ``2007''; and
       (3) by striking subsection (l) and inserting the following:
       ``(l) Use of Approved Food Safety Technology.--
       ``(1) In general.--In acquiring commodities for 
     distribution through a program specified in paragraph (2), 
     the Secretary shall not prohibit the use of any technology to 
     improve food safety that--
       ``(A) has been approved by the Secretary; or
       ``(B) has been approved or is otherwise allowed by the 
     Secretary of Health and Human Services.
       ``(2) Programs.--A program referred to in paragraph (1) is 
     a program authorized under--
       ``(A) this Act;
       ``(B) the Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.);
       ``(C) the Emergency Food Assistance Act of 1983 (7 U.S.C. 
     7501 et seq.);
       ``(D) the Richard B. Russell National School Lunch Act (42 
     U.S.C. 1751 et seq.); or
       ``(E) the Child Nutrition Act of 1966 (42 U.S.C. 1771 et 
     seq.).''.
       (c) Additional Funding for Certain States.--
       (1) In general.--Not later than 30 days after the date of 
     enactment of this Act, of the funds of the Commodity Credit 
     Corporation, the Secretary of Agriculture shall make 
     available an amount equal to the amount that the Secretary of 
     Agriculture determines to be necessary to permit each State 
     that began administering the commodity supplemental food 
     program under the Agriculture and Consumer Protection Act of 
     1973 (7 U.S.C. 612c note; Public Law 93-86) in the 2000 
     caseload cycle to administer the program, through the 2002 
     caseload cycle, at a caseload level that is not less than the 
     originally assigned caseload level of the State.
       (2) Provision to states.--The Secretary shall provide to 
     each State described in paragraph (1) for the purpose 
     described in that paragraph the funds made available under 
     that paragraph.
       (d) Effective Date.--The amendment made by subsection 
     (b)(3) takes effect on the date of enactment of this Act.

     SEC. 4202. COMMODITY DONATIONS.

       (a) In General.--The Commodity Distribution Reform Act and 
     WIC Amendments of 1987 (7 U.S.C. 612c note; Public Law 100-
     237) is amended--
       (1) by redesignating sections 17 and 18 as sections 18 and 
     19, respectively; and

[[Page H1847]]

       (2) by inserting after section 16 the following:

     ``SEC. 17. COMMODITY DONATIONS.

       ``(a) In General.--Notwithstanding any other provision of 
     law concerning commodity donations, any commodities acquired 
     in the conduct of the operations of the Commodity Credit 
     Corporation and any commodities acquired under section 32 of 
     the Act of August 24, 1935 (7 U.S.C. 612c), to the extent 
     that the commodities are in excess of the quantities of 
     commodities that are essential to carry out other authorized 
     activities of the Commodity Credit Corporation and the 
     Secretary (including any quantity specifically reserved for a 
     specific purpose), may be used for any program authorized to 
     be carried out by the Secretary that involves the acquisition 
     of commodities for use in a domestic feeding program, 
     including any program conducted by the Secretary that 
     provides commodities to individuals in cases of hardship.
       ``(b) Programs.--A program described in subsection (a) 
     includes a program authorized by--
       ``(1) the Emergency Food Assistance Act of 1983 (7 U.S.C. 
     7501 et seq.);
       ``(2) the Richard B. Russell National School Lunch Act (42 
     U.S.C. 1751 et seq.);
       ``(3) the Child Nutrition Act of 1966 (42 U.S.C. 1771 et 
     seq.);
       ``(4) the Older Americans Act of 1965 (42 U.S.C. 3001 et 
     seq.); or
       ``(5) such other laws as the Secretary determines to be 
     appropriate.''.
       (b) Effective Date.--The amendments made by this section 
     take effect on the date of enactment of this Act.

     SEC. 4203. DISTRIBUTION OF SURPLUS COMMODITIES TO SPECIAL 
                   NUTRITION PROJECTS.

       Section 1114(a)(2)(A) of the Agriculture and Food Act of 
     1981 (7 U.S.C. 1431e(2)(A)) is amended in the first sentence 
     by striking ``2002'' and inserting ``2007''.

     SEC. 4204. EMERGENCY FOOD ASSISTANCE.

       Section 204(a)(1) of the Emergency Food Assistance Act of 
     1983 (7 U.S.C. 7508(a)(1)) is amended in the first sentence--
       (1) by striking ``$50,000,000'' and inserting 
     ``$60,000,000'';
       (2) by striking ``1991 through 2002'' and inserting ``2003 
     through 2007'';
       (3) by striking ``administrative'';
       (4) by inserting ``storage,'' after ``processing,''; and
       (5) by inserting ``, including commodities secured by 
     gleaning (as defined in section 111(a) of the Hunger 
     Prevention Act of 1988 (7 U.S.C. 612c note; Public Law 100-
     435))'' after ``sources''.
            Subtitle C--Child Nutrition and Related Programs

     SEC. 4301. COMMODITIES FOR SCHOOL LUNCH PROGRAM.

       (a) In General.--Section 6(e)(1)(B) of the Richard B. 
     Russell National School Lunch Act (42 U.S.C. 1755(e)(1)(B)) 
     is amended by striking ``2001'' and inserting ``2003''.
       (b) Effective Date.--The amendment made by this section 
     takes effect on the date of enactment of this Act.

     SEC. 4302. ELIGIBILITY FOR FREE AND REDUCED PRICE MEALS.

       (a) In General.--Section 9(b) of the Richard B. Russell 
     National School Lunch Act (42 U.S.C. 1758(b)) is amended by 
     adding at the end the following:
       ``(7) Exclusion of certain military housing allowances.--
     For each of fiscal years 2002 and 2003, the amount of a basic 
     allowance provided under section 403 of title 37, United 
     States Code, on behalf of a member of a uniformed service for 
     housing that is acquired or constructed under subchapter IV 
     of chapter 169 of title 10, United States Code, or any 
     related provision of law, shall not be considered to be 
     income for the purpose of determining the eligibility of a 
     child who is a member of the household of the member of a 
     uniformed service for free or reduced price lunches under 
     this Act.''.
       (b) Effective Date.--The amendment made by this section 
     takes effect on the date of enactment of this Act.

     SEC. 4303. PURCHASES OF LOCALLY PRODUCED FOODS.

       Section 9 of the Richard B. Russell National School Lunch 
     Act (42 U.S.C. 1758) is amended by adding at the end the 
     following:
       ``(j) Purchases of Locally Produced Foods.--
       ``(1) In general.--The Secretary shall--
       ``(A) encourage institutions participating in the school 
     lunch program under this Act and the school breakfast program 
     established by section 4 of the Child Nutrition Act of 1966 
     (42 U.S.C. 1773) to purchase, in addition to other food 
     purchases, locally produced foods for school meal programs, 
     to the maximum extent practicable and appropriate;
       ``(B) advise institutions participating in a program 
     described in subparagraph (A) of the policy described in that 
     subparagraph and post information concerning the policy on 
     the website maintained by the Secretary; and
       ``(C) in accordance with requirements established by the 
     Secretary, provide startup grants to not more than 200 
     institutions to defray the initial costs of equipment, 
     materials, and storage facilities, and similar costs, 
     incurred in carrying out the policy described in subparagraph 
     (A).
       ``(2) Authorization of appropriations.--
       ``(A) In general.--There is authorized to be appropriated 
     to carry out this subsection $400,000 for each of fiscal 
     years 2003 through 2007, to remain available until expended.
       ``(B) Limitation.--No amounts may be made available to 
     carry out this subsection unless specifically provided by an 
     appropriation Act.''.

     SEC. 4304. APPLICABILITY OF BUY-AMERICAN REQUIREMENT TO 
                   PUERTO RICO.

       Section 12(n) of the Richard B. Russell National School 
     Lunch Act (42 U.S.C. 1760(n)) is amended by adding at the end 
     the following:
       ``(4) Applicability to puerto rico.--Paragraph (2)(A) shall 
     apply to a school food authority in the Commonwealth of 
     Puerto Rico with respect to domestic commodities or products 
     that are produced in the Commonwealth of Puerto Rico in 
     sufficient quantities to meet the needs of meals provided 
     under the school lunch program under this Act or the school 
     breakfast program under section 4 of the Child Nutrition Act 
     of 1966 (42 U.S.C. 1773).''.

     SEC. 4305. FRUIT AND VEGETABLE PILOT PROGRAM.

       (a) In General.--Section 18 of the Richard B. Russell 
     National School Lunch Act (42 U.S.C. 1769) is amended by 
     adding at the end the following:
       ``(g) Fruit and Vegetable Pilot Program.--
       ``(1) In general.--In the school year beginning July 2002, 
     the Secretary shall carry out a pilot program to make 
     available to students in 25 elementary or secondary schools 
     in each of 4 States, and in elementary or secondary schools 
     on 1 Indian reservation, free fresh and dried fruits and 
     fresh vegetables throughout the school day in 1 or more areas 
     designated by the school.
       ``(2) Publicity.--A school that participates in the pilot 
     program shall widely publicize within the school the 
     availability of free fruits and vegetables under the pilot 
     program.
       ``(3) Report.--Not later than May 1, 2003, the Secretary, 
     acting through the Administrator of the Economic Research 
     Service, shall report to the Committee on Education and the 
     Workforce of the House of Representatives and the Committee 
     on Agriculture, Nutrition, and Forestry of the Senate on the 
     results of the pilot program.
       ``(4) Funding.--The Secretary shall use not more than 
     $6,000,000 of funds made available under section 32 of the 
     Act of August 24, 1935 (7 U.S.C. 612c), to carry out this 
     subsection (other than paragraph (3)).''.
       (b) Effective Date.--The amendment made by this section 
     takes effect on the date of enactment of this Act.

     SEC. 4306. ELIGIBILITY FOR ASSISTANCE UNDER THE SPECIAL 
                   SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, 
                   INFANTS, AND CHILDREN.

       (a) In General.--Section 17(d)(2)(B)(i) of the Child 
     Nutrition Act of 1966 (42 U.S.C. 1786(d)(2)(B)(i)) is 
     amended--
       (1) by striking ``basic allowance for housing'' and 
     inserting the following: ``basic allowance--
       ``(I) for housing'';
       (2) by striking ``and'' at the end and inserting ``or''; 
     and
       (3) by adding at the end the following:
       ``(II) provided under section 403 of title 37, United 
     States Code, for housing that is acquired or constructed 
     under subchapter IV of chapter 169 of title 10, United States 
     Code, or any related provision of law; and''.
       (b) Effective Date.--The amendments made by this section 
     take effect on the date of enactment of this Act.

     SEC. 4307. WIC FARMERS' MARKET NUTRITION PROGRAM.

       (a) In General.--Section 17(m)(9) of the Child Nutrition 
     Act of 1966 (42 U.S.C. 1786(m)(9)) is amended--
       (1) by striking ``(9)(A) There'' and inserting the 
     following:
       ``(9) Funding.--
       ``(A) In general.--
       ``(i) Authorization of appropriations.--There''; and
       (2) in subparagraph (A), by adding at the end the 
     following:
       ``(ii) Mandatory funding.--Not later than 30 days after the 
     date of enactment of the Food Stamp Reauthorization Act of 
     2002, of the funds of the Commodity Credit Corporation, the 
     Secretary shall make available to carry out this subsection 
     $15,000,000, to remain available until expended.''.
       (b) Effective Date.--The amendments made by this section 
     take effect on the date of enactment of this Act.
                       Subtitle D--Miscellaneous

     SEC. 4401. PARTIAL RESTORATION OF BENEFITS TO LEGAL 
                   IMMIGRANTS.

       (a) Restoration of Benefits to Disabled Aliens.--Section 
     402(a)(2)(F) of the Personal Responsibility and Work 
     Opportunity Reconciliation Act of 1996 (8 U.S.C. 
     1612(a)(2)(F)) is amended by striking ``(i) was'' and all 
     that follows through ``(II) in the case'' and inserting the 
     following:
       ``(i) in the case of the specified Federal program 
     described in paragraph (3)(A)--

       ``(I) was lawfully residing in the United States on August 
     22, 1996; and
       ``(II) is blind or disabled (as defined in paragraph (2) or 
     (3) of section 1614(a) of the Social Security Act (42 U.S.C. 
     1382c(a))); and

       ``(ii) in the case''.
       (b) Restoration of Benefits to All Qualified Alien 
     Children.--
       (1) In general.--Section 402(a)(2)(J) of the Personal 
     Responsibility and Work Opportunity Reconciliation Act of 
     1996 (8 U.S.C. 1612(a)(2)(J)) is amended by striking ``who'' 
     and all that follows through ``is under'' and inserting ``who 
     is under''.
       (2) Conforming amendments.--
       (A) Section 403(c)(2) of the Personal Responsibility and 
     Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 
     1613(c)(2)) is amended by adding at the end the following:
       ``(L) Assistance or benefits provided to individuals under 
     the age of 18 under the Food Stamp Act of 1977 (7 U.S.C. 2011 
     et seq.).''.
       (B) Section 421(d) of the Personal Responsibility and Work 
     Opportunity Reconciliation Act of 1996 (8 U.S.C. 1631(d)) is 
     amended by adding at the end the following:
       ``(3) This section shall not apply to assistance or 
     benefits under the Food Stamp Act of 1977 (7 U.S.C. 2011 et 
     seq.) to the extent that a qualified alien is eligible under 
     section 402(a)(2)(J).''.

[[Page H1848]]

       (C) Section 5(i)(2)(E) of the Food Stamp Act of 1977 (7 
     U.S.C. 2014(i)(2)(E)) is amended by inserting before the 
     period at the end the following: ``, or to any alien who is 
     under 18 years of age''.
       (3) Effective date.--The amendments made by this subsection 
     take effect on October 1, 2003.
       (c) Food Stamp Exception for Certain Qualified Aliens.--
       (1) In general.--Section 402(a)(2) of the Personal 
     Responsibility and Work Opportunity Reconciliation Act of 
     1996 (8 U.S.C. 1612(a)(2)) is amended by adding at the end 
     the following:
       ``(L) Food stamp exception for certain qualified aliens.--
     With respect to eligibility for benefits for the specified 
     Federal program described in paragraph (3)(B), paragraph (1) 
     shall not apply to any qualified alien who has resided in the 
     United States with a status within the meaning of the term 
     `qualified alien' for a period of 5 years or more beginning 
     on the date of the alien's entry into the United States.''.
       (2) Effective date.--The amendment made by paragraph (1) 
     takes effect on April 1, 2003.

     SEC. 4402. SENIORS FARMERS' MARKET NUTRITION PROGRAM.

       (a) Establishment.--The Secretary of Agriculture shall use 
     $5,000,000 for fiscal year 2002, and $15,000,000 for each of 
     fiscal years 2003 through 2007, of the funds available to the 
     Commodity Credit Corporation to carry out and expand a 
     seniors farmers' market nutrition program.
       (b) Program Purposes.--The purposes of the seniors farmers' 
     market nutrition program are--
       (1) to provide resources in the form of fresh, nutritious, 
     unprepared, locally grown fruits, vegetables, and herbs from 
     farmers' markets, roadside stands, and community supported 
     agriculture programs to low-income seniors;
       (2) to increase the domestic consumption of agricultural 
     commodities by expanding or aiding in the expansion of 
     domestic farmers' markets, roadside stands, and community 
     supported agriculture programs; and
       (3) to develop or aid in the development of new and 
     additional farmers' markets, roadside stands, and community 
     supported agriculture programs.
       (c) Regulations.--The Secretary may issue such regulations 
     as the Secretary considers necessary to carry out the seniors 
     farmers' market nutrition program.

     SEC. 4403. NUTRITION INFORMATION AND AWARENESS PILOT PROGRAM.

       (a) Establishment.--The Secretary of Agriculture may 
     establish, in not more than 5 States, for a period not to 
     exceed 4 years for each participating State, a pilot program 
     to increase the domestic consumption of fresh fruits and 
     vegetables.
       (b) Purpose.--
       (1) In general.--Subject to paragraph (2), the purpose of 
     the program shall be to provide funds to States solely for 
     the purpose of assisting eligible public and private sector 
     entities with cost-share assistance to carry out 
     demonstration projects--
       (A) to increase fruit and vegetable consumption; and
       (B) to convey related health promotion messages.
       (2) Limitation.--Funds made available to a State under the 
     program shall not be used to disparage any agricultural 
     commodity.
       (c) Selection of States.--
       (1) In general.--In selecting States to participate in the 
     program, the Secretary shall take into consideration, with 
     respect to projects and activities proposed to be carried out 
     under the program--
       (A) experience in carrying out similar projects or 
     activities;
       (B) innovative approaches; and
       (C) the ability of the State to promote and track increases 
     in levels of fruit and vegetable consumption.
       (2) Enhancement of existing state programs.--The Secretary 
     may use the pilot program to enhance existing State programs 
     that are consistent with the purpose of the pilot program 
     specified in subsection (b).
       (d) Eligible Public and Private Sector Entities.--
       (1) In general.--A participating State shall establish 
     eligibility criteria under which the State may select public 
     and private sector entities to carry out demonstration 
     projects under the program.
       (2) Limitation.--No funds made available to States under 
     the program shall be provided by a State to any foreign for-
     profit corporation.
       (e) Federal Share.--The Federal share of the cost of any 
     project or activity carried out using funds provided under 
     this section shall be 50 percent.
       (f) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $10,000,000 for 
     each of fiscal years 2002 through 2007.

     SEC. 4404. HUNGER FELLOWSHIP PROGRAM.

       (a) Short Title; Findings.--
       (1) Short title.--This section may be cited as the 
     ``Congressional Hunger Fellows Act of 2002''.
       (2) Findings.--The Congress finds as follows:
       (A) There is a critical need for compassionate individuals 
     who are committed to assisting people who suffer from hunger 
     as well as a need for such individuals to initiate and 
     administer solutions to the hunger problem.
       (B) Bill Emerson, the distinguished late Representative 
     from the 8th District of Missouri, demonstrated his 
     commitment to solving the problem of hunger in a bipartisan 
     manner, his commitment to public service, and his great 
     affection for the institution and the ideals of the United 
     States Congress.
       (C) George T. (Mickey) Leland, the distinguished late 
     Representative from the 18th District of Texas, demonstrated 
     his compassion for those in need, his high regard for public 
     service, and his lively exercise of political talents.
       (D) The special concern that Mr. Emerson and Mr. Leland 
     demonstrated during their lives for the hungry and poor was 
     an inspiration for others to work toward the goals of 
     equality and justice for all.
       (E) These two outstanding leaders maintained a special bond 
     of friendship regardless of political affiliation and worked 
     together to encourage future leaders to recognize and provide 
     service to others, and therefore it is especially appropriate 
     to honor the memory of Mr. Emerson and Mr. Leland by creating 
     a fellowship program to develop and train the future leaders 
     of the United States to pursue careers in humanitarian 
     service.
       (b) Establishment.--There is established as an independent 
     entity of the legislative branch of the United States 
     Government the Congressional Hunger Fellows Program 
     (hereinafter in this section referred to as the ``Program'').
       (c) Board of Trustees.--
       (1) In general.--The Program shall be subject to the 
     supervision and direction of a Board of Trustees.
       (2) Members of the board of trustees.--
       (A) Appointment.--The Board shall be composed of 6 voting 
     members appointed under clause (i) and one nonvoting ex 
     officio member designated in clause (ii) as follows:
       (i) Voting members.--(I) The Speaker of the House of 
     Representatives shall appoint two members.
       (II) The minority leader of the House of Representatives 
     shall appoint one member.
       (III) The majority leader of the Senate shall appoint two 
     members.
       (IV) The minority leader of the Senate shall appoint one 
     member.
       (ii) Nonvoting member.--The Executive Director of the 
     program shall serve as a nonvoting ex officio member of the 
     Board.
       (B) Terms.--Members of the Board shall serve a term of 4 
     years.
       (C) Vacancy.--
       (i) Authority of board.--A vacancy in the membership of the 
     Board does not affect the power of the remaining members to 
     carry out this section.
       (ii) Appointment of successors.--A vacancy in the 
     membership of the Board shall be filled in the same manner in 
     which the original appointment was made.
       (iii) Incomplete term.--If a member of the Board does not 
     serve the full term applicable to the member, the individual 
     appointed to fill the resulting vacancy shall be appointed 
     for the remainder of the term of the predecessor of the 
     individual.
       (D) Chairperson.--As the first order of business of the 
     first meeting of the Board, the members shall elect a 
     Chairperson.
       (E) Compensation.--
       (i) In general.--Subject to clause (ii), members of the 
     Board may not receive compensation for service on the Board.
       (ii) Travel.--Members of the Board may be reimbursed for 
     travel, subsistence, and other necessary expenses incurred in 
     carrying out the duties of the program.
       (3) Duties.--
       (A) Bylaws.--
       (i) Establishment.--The Board shall establish such bylaws 
     and other regulations as may be appropriate to enable the 
     Board to carry out this section, including the duties 
     described in this paragraph.
       (ii) Contents.--Such bylaws and other regulations shall 
     include provisions--

       (I) for appropriate fiscal control, funds accountability, 
     and operating principles;
       (II) to prevent any conflict of interest, or the appearance 
     of any conflict of interest, in the procurement and 
     employment actions taken by the Board or by any officer or 
     employee of the Board and in the selection and placement of 
     individuals in the fellowships developed under the program;
       (III) for the resolution of a tie vote of the members of 
     the Board; and
       (IV) for authorization of travel for members of the Board.

       (iii) Transmittal to congress.--Not later than 90 days 
     after the date of the first meeting of the Board, the 
     Chairperson of the Board shall transmit to the appropriate 
     congressional committees a copy of such bylaws.
       (B) Budget.--For each fiscal year the program is in 
     operation, the Board shall determine a budget for the program 
     for that fiscal year. All spending by the program shall be 
     pursuant to such budget unless a change is approved by the 
     Board.
       (C) Process for selection and placement of fellows.--The 
     Board shall review and approve the process established by the 
     Executive Director for the selection and placement of 
     individuals in the fellowships developed under the program.
       (D) Allocation of funds to fellowships.--The Board of 
     Trustees shall determine the priority of the programs to be 
     carried out under this section and the amount of funds to be 
     allocated for the Emerson and Leland fellowships.
       (d) Purposes; Authority of Program.--
       (1) Purposes.--The purposes of the program are--
       (A) to encourage future leaders of the United States to 
     pursue careers in humanitarian service, to recognize the 
     needs of people who are hungry and poor, and to provide 
     assistance and compassion for those in need;
       (B) to increase awareness of the importance of public 
     service; and
       (C) to provide training and development opportunities for 
     such leaders through placement in programs operated by 
     appropriate organizations or entities.
       (2) Authority.--The program is authorized to develop such 
     fellowships to carry out the purposes of this section, 
     including the fellowships described in paragraph (3).

[[Page H1849]]

       (3) Fellowships.--
       (A) In general.--The program shall establish and carry out 
     the Bill Emerson Hunger Fellowship and the Mickey Leland 
     Hunger Fellowship.
       (B) Curriculum.--
       (i) In general.--The fellowships established under 
     subparagraph (A) shall provide experience and training to 
     develop the skills and understanding necessary to improve the 
     humanitarian conditions and the lives of individuals who 
     suffer from hunger, including--

       (I) training in direct service to the hungry in conjunction 
     with community-based organizations through a program of field 
     placement; and
       (II) experience in policy development through placement in 
     a governmental entity or nonprofit organization.

       (ii) Focus of bill emerson hunger fellowship.--The Bill 
     Emerson Hunger Fellowship shall address hunger and other 
     humanitarian needs in the United States.
       (iii) Focus of mickey leland hunger fellowship.--The Mickey 
     Leland Hunger Fellowship shall address international hunger 
     and other humanitarian needs.
       (iv) Workplan.--To carry out clause (i) and to assist in 
     the evaluation of the fellowships under paragraph (4), the 
     program shall, for each fellow, approve a work plan that 
     identifies the target objectives for the fellow in the 
     fellowship, including specific duties and responsibilities 
     related to those objectives.
       (C) Period of fellowship.--
       (i) Emerson fellow.--A Bill Emerson Hunger Fellowship 
     awarded under this paragraph shall be for no more than 1 
     year.
       (ii) Leland fellow.--A Mickey Leland Hunger Fellowship 
     awarded under this paragraph shall be for no more than 2 
     years. Not less than 1 year of the fellowship shall be 
     dedicated to fulfilling the requirement of subparagraph 
     (B)(i)(I).
       (D) Selection of fellows.--
       (i) In general.--A fellowship shall be awarded pursuant to 
     a nationwide competition established by the program.
       (ii) Qualification.--A successful applicant shall be an 
     individual who has demonstrated--

       (I) an intent to pursue a career in humanitarian service 
     and outstanding potential for such a career;
       (II) leadership potential or actual leadership experience;
       (III) diverse life experience;
       (IV) proficient writing and speaking skills;
       (V) an ability to live in poor or diverse communities; and
       (VI) such other attributes as determined to be appropriate 
     by the Board.

       (iii) Amount of award.--

       (I) In general.--Each individual awarded a fellowship under 
     this paragraph shall receive a living allowance and, subject 
     to subclause (II), an end-of-service award as determined by 
     the program.
       (II) Requirement for successful completion of fellowship.--
     Each individual awarded a fellowship under this paragraph 
     shall be entitled to receive an end-of-service award at an 
     appropriate rate for each month of satisfactory service as 
     determined by the Executive Director.

       (iv) Recognition of fellowship award.--

       (I) Emerson fellow.--An individual awarded a fellowship 
     from the Bill Emerson Hunger Fellowship shall be known as an 
     ``Emerson Fellow''.
       (II) Leland fellow.--An individual awarded a fellowship 
     from the Mickey Leland Hunger Fellowship shall be known as a 
     ``Leland Fellow''.

       (4) Evaluation.--The program shall conduct periodic 
     evaluations of the Bill Emerson and Mickey Leland Hunger 
     Fellowships. Such evaluations shall include the following:
       (A) An assessment of the successful completion of the work 
     plan of the fellow.
       (B) An assessment of the impact of the fellowship on the 
     fellows.
       (C) An assessment of the accomplishment of the purposes of 
     the program.
       (D) An assessment of the impact of the fellow on the 
     community.
       (e) Trust Fund.--
       (1) Establishment.--There is established the Congressional 
     Hunger Fellows Trust Fund (hereinafter in this section 
     referred to as the ``Fund'') in the Treasury of the United 
     States, consisting of amounts appropriated to the Fund under 
     subsection (i), amounts credited to it under paragraph (3), 
     and amounts received under subsection (g)(3)(A).
       (2) Investment of funds.--The Secretary of the Treasury 
     shall invest the full amount of the Fund. Each investment 
     shall be made in an interest bearing obligation of the United 
     States or an obligation guaranteed as to principal and 
     interest by the United States that, as determined by the 
     Secretary in consultation with the Board, has a maturity 
     suitable for the Fund.
       (3) Return on investment.--Except as provided in subsection 
     (f)(2), the Secretary of the Treasury shall credit to the 
     Fund the interest on, and the proceeds from the sale or 
     redemption of, obligations held in the Fund.
       (f) Expenditures; Audits.--
       (1) In general.--The Secretary of the Treasury shall 
     transfer to the program from the amounts described in 
     subsection (e)(3) and subsection (g)(3)(A) such sums as the 
     Board determines are necessary to enable the program to carry 
     out the provisions of this section.
       (2) Limitation.--The Secretary may not transfer to the 
     program the amounts appropriated to the Fund under subsection 
     (i).
       (3) Use of funds.--Funds transferred to the program under 
     paragraph (1) shall be used for the following purposes:
       (A) Stipends for fellows.--To provide for a living 
     allowance for the fellows.
       (B) Travel of fellows.--To defray the costs of 
     transportation of the fellows to the fellowship placement 
     sites.
       (C) Insurance.--To defray the costs of appropriate 
     insurance of the fellows, the program, and the Board.
       (D) Training of fellows.--To defray the costs of preservice 
     and midservice education and training of fellows.
       (E) Support staff.--Staff described in subsection (g).
       (F) Awards.--End-of-service awards under subsection 
     (d)(3)(D)(iii)(II).
       (G) Additional approved uses.--For such other purposes that 
     the Board determines appropriate to carry out the program.
       (4) Audit by gao.--
       (A) In general.--The Comptroller General of the United 
     States shall conduct an annual audit of the accounts of the 
     program.
       (B) Books.--The program shall make available to the 
     Comptroller General all books, accounts, financial records 
     (including records of salaries of the Executive Director and 
     other personnel), reports, files, and all other papers, 
     things, or property belonging to or in use by the program and 
     necessary to facilitate such audit.
       (C) Report to congress.--The Comptroller General shall 
     submit a copy of the results of each such audit to the 
     appropriate congressional committees.
       (g) Staff; Powers of Program.--
       (1) Executive director.--
       (A) In general.--The Board shall appoint an Executive 
     Director of the program who shall administer the program. The 
     Executive Director shall carry out such other functions 
     consistent with the provisions of this section as the Board 
     shall prescribe.
       (B) Restriction.--The Executive Director may not serve as 
     Chairperson of the Board.
       (C) Compensation.--The Executive Director shall be paid at 
     a rate not to exceed the rate of basic pay payable for level 
     V of the Executive Schedule under section 5316 of title 5, 
     United States Code.
       (2) Staff.--
       (A) In general.--With the approval of a majority of the 
     Board, the Executive Director may appoint and fix the pay of 
     additional personnel as the Executive Director considers 
     necessary and appropriate to carry out the functions of the 
     provisions of this section.
       (B) Compensation.--An individual appointed under 
     subparagraph (A) shall be paid at a rate not to exceed the 
     rate of basic pay payable for level GS-15 of the General 
     Schedule.
       (3) Powers.--In order to carry out the provisions of this 
     section, the program may perform the following functions:
       (A) Gifts.--The program may solicit, accept, use, and 
     dispose of gifts, bequests, or devises of services or 
     property, both real and personal, for the purpose of aiding 
     or facilitating the work of the program. Gifts, bequests, or 
     devises of money and proceeds from sales of other property 
     received as gifts, bequests, or devises shall be deposited in 
     the Fund and shall be available for disbursement upon order 
     of the Board.
       (B) Experts and consultants.--The program may procure 
     temporary and intermittent services under section 3109 of 
     title 5, United States Code, but at rates for individuals not 
     to exceed the daily equivalent of the maximum annual rate of 
     basic pay payable for GS-15 of the General Schedule.
       (C) Contract authority.--The program may contract, with the 
     approval of a majority of the members of the Board, with and 
     compensate Government and private agencies or persons without 
     regard to section 3709 of the Revised Statutes (41 U.S.C. 5).
       (D) Other necessary expenditures.--The program shall make 
     such other expenditures which the program considers necessary 
     to carry out the provisions of this section, but excluding 
     project development.
       (h) Report.--Not later than December 31 of each year, the 
     Board shall submit to the appropriate congressional 
     committees a report on the activities of the program carried 
     out during the previous fiscal year, and shall include the 
     following:
       (1) An analysis of the evaluations conducted under 
     subsection (d)(4) (relating to evaluations of the Emerson and 
     Leland fellowships and accomplishment of the program 
     purposes) during that fiscal year.
       (2) A statement of the total amount of funds attributable 
     to gifts received by the program in that fiscal year (as 
     authorized under subsection (g)(3)(A)), and the total amount 
     of such funds that were expended to carry out the program 
     that fiscal year.
       (i) Authorization of Appropriations.--There are authorized 
     to be appropriated $18,000,000 to carry out the provisions of 
     this section.
       (j) Definition.--In this section, the term ``appropriate 
     congressional committees'' means--
       (1) the Committee on Agriculture and the Committee on 
     International Relations of the House of Representatives; and
       (2) the Committee on Agriculture, Nutrition, and Forestry 
     and the Committee on Foreign Relations of the Senate.

     SEC. 4405. GENERAL EFFECTIVE DATE.

       Except as otherwise provided in this title, the amendments 
     made by this title take effect on October 1, 2002.
                            TITLE V--CREDIT
                    Subtitle A--Farm Ownership Loans

     SEC. 5001. DIRECT LOANS.

       Section 302(b)(1) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1922(b)(1)) is amended by striking 
     ``operated'' and inserting ``participated in the business 
     operations of''.

     SEC. 5002. FINANCING OF BRIDGE LOANS.

       Section 303(a)(1) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1923(a)(1)) is amended--
       (1) in subparagraph (C), by striking ``or'' at the end;

[[Page H1850]]

       (2) in subparagraph (D), by striking the period at the end 
     and inserting ``; or''; and
       (3) by adding at the end the following:
       ``(E) refinancing a temporary bridge loan made by a 
     commercial or cooperative lender to a farmer or rancher for 
     the acquisition of land for a farm or ranch, if--
       ``(i) the Secretary approved an application for a direct 
     farm ownership loan to the farmer or rancher for acquisition 
     of the land; and
       ``(ii) funds for direct farm ownership loans under section 
     346(b) were not available at the time at which the 
     application was approved.''.

     SEC. 5003. AMOUNT OF GUARANTEE OF LOANS FOR FARM OPERATIONS 
                   ON TRIBAL LANDS.

       Section 309(h) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1929(h)) is amended--
       (1) in paragraph (4), by striking ``paragraphs (5) and 
     (6)'' and inserting ``paragraphs (5), (6), and (7)''; and
       (2) by adding at the end the following:
       ``(7) Amount of guarantee of loans for farm operations on 
     tribal lands.--In the case of an operating loan made to a 
     farmer or rancher whose farm or ranch land is subject to the 
     jurisdiction of an Indian tribe and whose loan is secured by 
     1 or more security instruments that are subject to the 
     jurisdiction of an Indian tribe, the Secretary shall 
     guarantee 95 percent of the loan.''.

     SEC. 5004. GUARANTEE OF LOANS MADE UNDER STATE BEGINNING 
                   FARMER OR RANCHER PROGRAMS.

       Section 309 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1929) is amended by adding at the end the 
     following:
       ``(j) Guarantee of Loans Made Under State Beginning Farmer 
     or Rancher Programs.--The Secretary may guarantee under this 
     title a loan made under a State beginning farmer or rancher 
     program, including a loan financed by the net proceeds of a 
     qualified small issue agricultural bond for land or property 
     described in section 144(a)(12)(B)(ii) of the Internal 
     Revenue Code of 1986.''.

     SEC. 5005. DOWN PAYMENT LOAN PROGRAM.

       Section 310E of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1935) is amended--
       (1) in subsection (b)--
       (A) in paragraph (1), by striking ``30 percent'' and 
     inserting ``40 percent''; and
       (B) in paragraph (3), by striking ``10 years'' and 
     inserting ``15 years''; and
       (2) in subsection (c)(3)(B), by striking ``10-year'' and 
     inserting ``15-year''.

     SEC. 5006. BEGINNING FARMER AND RANCHER CONTRACT LAND SALES 
                   PROGRAM.

       Subtitle A of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1922 et seq.) is amended by adding at the end 
     the following:

     ``SEC. 310F. BEGINNING FARMER AND RANCHER CONTRACT LAND SALES 
                   PROGRAM.

       ``(a) In General.--If the Secretary makes a determination 
     that the risk is comparable under subsection (b), the 
     Secretary shall carry out a pilot program in not fewer than 5 
     States, as determined by the Secretary, to guarantee up to 5 
     loans per State in each of fiscal years 2003 through 2007 
     made by a private seller of a farm or ranch to a qualified 
     beginning farmer or rancher on a contract land sale basis, if 
     the loan meets applicable underwriting criteria and a 
     commercial lending institution agrees to serve as escrow 
     agent.
       ``(b) Date of Commencement of Program.--Not later than 
     October 1, 2002, the Secretary shall make a determination on 
     whether guarantees of contract land sales present a risk that 
     is comparable with the risk presented in the case of 
     guarantees to commercial lenders.''.
                      Subtitle B--Operating Loans

     SEC. 5101. DIRECT LOANS.

       Section 311(c) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1941(c)) is amended--
       (1) in paragraph (1)--
       (A) in the matter that precedes subparagraph (A), by 
     striking ``paragraph (3)'' and inserting ``paragraphs (3) and 
     (4)''; and
       (B) in subparagraph (A), by striking ``who has not'' and 
     all that follows through ``5 years''; and
       (2) by adding at the end the following:
       ``(4) Waivers.--
       ``(A) Farm and ranch operations on tribal lands.--The 
     Secretary shall waive the limitation under paragraph (1)(C) 
     or (3) for a direct loan made under this subtitle to a farmer 
     or rancher whose farm or ranch land is subject to the 
     jurisdiction of an Indian tribe and whose loan is secured by 
     1 or more security instruments that are subject to the 
     jurisdiction of an Indian tribe if the Secretary determines 
     that commercial credit is not generally available for such 
     farm or ranch operations.
       ``(B) Other farm and ranch operations.--On a case-by-case 
     determination not subject to administrative appeal, the 
     Secretary may grant a borrower a waiver, 1 time only for a 
     period of 2 years, of the limitation under paragraph (1)(C) 
     or (3) for a direct operating loan if the borrower 
     demonstrates to the satisfaction of the Secretary that--
       ``(i) the borrower has a viable farm or ranch operation;
       ``(ii) the borrower applied for commercial credit from at 
     least 2 commercial lenders;
       ``(iii) the borrower was unable to obtain a commercial loan 
     (including a loan guaranteed by the Secretary); and
       ``(iv) the borrower successfully has completed, or will 
     complete within 1 year, borrower training under section 359 
     (from which requirement the Secretary shall not grant a 
     waiver under section 359(f)).''.

     SEC. 5102. SUSPENSION OF LIMITATION ON PERIOD FOR WHICH 
                   BORROWERS ARE ELIGIBLE FOR GUARANTEED 
                   ASSISTANCE.

       During the period beginning January 1, 2002, and ending 
     December 31, 2006, section 319(b) of the Consolidated Farm 
     and Rural Development Act (7 U.S.C. 1949(b)) shall have no 
     force or effect.
                      Subtitle C--Emergency Loans

     SEC. 5201. EMERGENCY LOANS IN RESPONSE TO AN EMERGENCY 
                   RESULTING FROM QUARANTINES.

       (a) Loan Authority.--Section 321(a) of the Consolidated 
     Farm and Rural Development Act (7 U.S.C. 1961(a)) is 
     amended--
       (1) in each of the 1st and 3rd sentences, by striking ``a 
     natural disaster in the United States or by'' and inserting 
     ``a quarantine imposed by the Secretary under the Plant 
     Protection Act or the animal quarantine laws (as defined in 
     section 2509 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990), a natural disaster in the United States, 
     or''; and
       (2) in the 4th sentence--
       (A) by striking ``a natural disaster'' and inserting ``such 
     a quarantine or natural disaster''; and
       (B) by striking ``by such natural disaster'' and inserting 
     ``by such quarantine or natural disaster''.
       (b) Conforming Amendment.--Section 323 of such Act (7 
     U.S.C. 1963) is amended by inserting ``quarantine,'' before 
     ``natural disaster''.
                 Subtitle D--Administrative Provisions

     SEC. 5301. EVALUATIONS OF DIRECT AND GUARANTEED LOAN 
                   PROGRAMS.

       (a) Studies.--The Secretary of Agriculture shall conduct 2 
     studies of the direct and guaranteed loan progams under 
     sections 302 and 311 of the Consolidated Farm and Rural 
     Development Act, each of which shall include an examination 
     of the number, average principal amount, and delinquency and 
     default rates of loans provided or guaranteed during the 
     period covered by the study.
       (b) Periods Covered.--
       (1) First study.--One study under subsection (a) shall 
     cover the 1-year period that begins 1 year after the date of 
     the enactment of this section.
       (2) Second study.--One study under subsection (a) shall 
     cover the 1-year period that begins 3 years after such date 
     of enactment.
       (c) Reports to the Congress.--At the end of the period 
     covered by each study under this section, the Secretary of 
     Agriculture shall submit to the Congress a report that 
     contains an evaluation of the results of the study, including 
     an analysis of the effectiveness of loan programs referred to 
     in subsection (a) in meeting the credit needs of agricultural 
     producers in an efficient and fiscally responsible manner.

     SEC. 5302. ELIGIBILITY OF TRUSTS AND LIMITED LIABILITY 
                   COMPANIES FOR FARM OWNERSHIP LOANS, FARM 
                   OPERATING LOANS, AND EMERGENCY LOANS.

       (a) In General.--Sections 302(a), 311(a), and 321(a) of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 
     1922(a), 1941(a), and 1961(a)) are each amended by striking 
     ``and joint operations'' each place it appears and inserting 
     ``joint operations, trusts, and limited liability 
     companies''.
       (b) Conforming Amendment.--Section 321(a) of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 
     1961(a)) is amended by striking ``or joint operations'' each 
     place it appears and inserting ``joint operations, trusts, or 
     limited liability companies''.

     SEC. 5303. DEBT SETTLEMENT.

       Section 331(b)(4) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1981(b)(4)) is amended--
       (1) by striking ``The Secretary may release'' and inserting 
     ``After consultation with a local or area county committee, 
     the Secretary may release''; and
       (2) by striking ``carried out--'' and all that follows 
     through ``(B) after'' and inserting ``carried out after''.

     SEC. 5304. TEMPORARY AUTHORITY TO ENTER INTO CONTRACTS; 
                   PRIVATE COLLECTION AGENCIES.

       (a) In General.--Section 331 of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 1981) is amended by striking 
     subsections (d) and (e).
       (b) Application.--The amendment made by subsection (a) 
     shall not apply to a contract entered into before the 
     effective date of this Act.

     SEC. 5305. INTEREST RATE OPTIONS FOR LOANS IN SERVICING.

       Section 331B of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1981b) is amended--
       (1) by striking ``lower of (1) the'' and inserting the 
     following: ``lowest of--
       ``(1) the''; and
       (2) by striking ``original loan or (2) the'' and inserting 
     the following: ``original loan;
       ``(2) the rate being charged by the Secretary for loans, 
     other than guaranteed loans, of the same type at the time at 
     which the borrower applies for a deferral, consolidation, 
     rescheduling, or reamortization; or
       ``(3) the''.

     SEC. 5306. ELIMINATION OF REQUIREMENT THAT SECRETARY REQUIRE 
                   COUNTY COMMITTEES TO CERTIFY IN WRITING THAT 
                   CERTAIN LOAN REVIEWS HAVE BEEN CONDUCTED.

       Section 333(2) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1983(2)) is amended to read as 
     follows:
       ``(2) except with respect to a loan under section 306, 
     310B, or 314--
       ``(A) an annual review of the credit history and business 
     operation of the borrower; and
       ``(B) an annual review of the continued eligibility of the 
     borrower for the loan;''.

     SEC. 5307. SIMPLIFIED LOAN GUARANTEE APPLICATION AVAILABLE 
                   FOR LOANS OF GREATER AMOUNTS.

       Section 333A(g)(1) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C.

[[Page H1851]]

     1983a(g)(1)) is amended by striking ``$50,000'' and inserting 
     ``$125,000''.

     SEC. 5308. INVENTORY PROPERTY.

       Section 335(c) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1985(c)) is amended--
       (1) in paragraph (1)--
       (A) in subparagraph (B)--
       (i) in clause (i), by striking ``75 days'' and inserting 
     ``135 days''; and
       (ii) by adding at the end the following:
       ``(iv) Combining and dividing of property.--To the maximum 
     extent practicable, the Secretary shall maximize the 
     opportunity for beginning farmers and ranchers to purchase 
     real property acquired by the Secretary under this title by 
     combining or dividing inventory parcels of the property in 
     such manner as the Secretary determines to be appropriate.''; 
     and
       (B) in subparagraph (C)--
       (i) by striking ``75 days'' and inserting ``135 days''; and
       (ii) by striking ``75-day period'' and inserting ``135-day 
     period''; and
       (2) by striking paragraph (2) and inserting the following:
       ``(2) Previous lease.--In the case of real property 
     acquired before April 4, 1996, that the Secretary leased 
     before April 4, 1996, not later than 60 days after the lease 
     expires, the Secretary shall offer to sell the property in 
     accordance with paragraph (1).''.

     SEC. 5309. ADMINISTRATION OF CERTIFIED LENDERS AND PREFERRED 
                   CERTIFIED LENDERS PROGRAMS.

       Section 339 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1989) is amended by adding at the end the 
     following:
       ``(e) Administration of Certified Lenders and Preferred 
     Certified Lenders Programs.--The Secretary may administer the 
     loan guarantee programs under subsections (c) and (d) through 
     central offices established in States or in multi-State 
     areas.''.

     SEC. 5310. DEFINITIONS.

       (a) Qualified Beginning Farmer or Rancher.--Section 
     343(a)(11)(F) of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1991(a)(11)(F)) is amended by striking ``25 
     percent'' and inserting ``30 percent''.
       (b) Debt Forgiveness.--Section 343(a)(12)(B) of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 
     1991(a)(12)(B)) is amended to read as follows:
       ``(B) Exceptions.--The term `debt forgiveness' does not 
     include--
       ``(i) consolidation, rescheduling, reamortization, or 
     deferral of a loan; or
       ``(ii) any write-down provided as part of a resolution of a 
     discrimination complaint against the Secretary.''.

     SEC. 5311. LOAN AUTHORIZATION LEVELS.

       Section 346(b)(1) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1994(b)(1)) is amended to read as 
     follows:
       ``(1) In general.--The Secretary may make or guarantee 
     loans under subtitles A and B from the Agricultural Credit 
     Insurance Fund provided for in section 309 for not more than 
     $3,796,000,000 for each of fiscal years 2003 through 2007, of 
     which, for each fiscal year--
       ``(A) $770,000,000 shall be for direct loans, of which--
       ``(i) $205,000,000 shall be for farm ownership loans under 
     subtitle A; and
       ``(ii) $565,000,000 shall be for operating loans under 
     subtitle B; and
       ``(B) $3,026,000,000 shall be for guaranteed loans, of 
     which--
       ``(i) $1,000,000,000 shall be for guarantees of farm 
     ownership loans under subtitle A; and
       ``(ii) $2,026,000,000 shall be for guarantees of operating 
     loans under subtitle B.''.

     SEC. 5312. RESERVATION OF FUNDS FOR DIRECT OPERATING LOANS 
                   FOR BEGINNING FARMERS AND RANCHERS.

       Section 346(b)(2)(A)(ii)(III) of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 1994(b)(2)(A)(ii)(III)) is 
     amended by striking ``2000 through 2002'' and inserting 
     ``2003 through 2007''.

     SEC. 5313. INTEREST RATE REDUCTION PROGRAM.

       Section 351 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1999) is amended--
       (1) in subsection (a)--
       (A) by striking ``Program.--'' and all that follows through 
     ``The Secretary'' and inserting ``Program.--The Secretary''; 
     and
       (B) by striking paragraph (2); and
       (2) in subsection (e), by striking paragraph (2) and 
     inserting the following:
       ``(2) Maximum amount of funds.--
       ``(A) In general.--The total amount of funds used by the 
     Secretary to carry out this section for a fiscal year shall 
     not exceed $750,000,000.
       ``(B) Beginning farmers and ranchers.--
       ``(i) In general.--The Secretary shall reserve not less 
     than 15 percent of the funds used by the Secretary under 
     subparagraph (A) to make payments for guaranteed loans made 
     to beginning farmers and ranchers.
       ``(ii) Duration of reservation of funds.--Funds reserved 
     for beginning farmers or ranchers under clause (i) for a 
     fiscal year shall be reserved only until March 1 of the 
     fiscal year.''.

     SEC. 5314. REAMORTIZATION OF RECAPTURE PAYMENTS.

       Section 353(e)(7) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 2001(e)(7)) is amended by adding at 
     the end the following:
       ``(D) Reamortization.--
       ``(i) In general.--The Secretary may modify the 
     amortization of a recapture payment referred to in 
     subparagraph (A) of this paragraph on which a payment has 
     become delinquent by using loan service tools under section 
     343(b)(3) if--

       ``(I) the default is due to circumstances beyond the 
     control of the borrower; and

       ``(II) the borrower acted in good faith (as determined by 
     the Secretary) in attempting to repay the recapture amount.

       ``(ii) Limitations.--

       ``(I) Term of reamortization.--The term of a reamortization 
     under this subparagraph may not exceed 25 years from the date 
     of the original amortization agreement.
       ``(II) No reduction or principal or unpaid interest due.--A 
     reamortization of a recapture payment under this subparagraph 
     may not provide for reducing the outstanding principal or 
     unpaid interest due on the recapture payment.

     SEC. 5315. ALLOCATION OF CERTAIN FUNDS FOR SOCIALLY 
                   DISADVANTAGED FARMERS AND RANCHERS.

       The last sentence of section 355(c)(2) of the Consolidated 
     Farm and Rural Development Act (7 U.S.C. 2003(c)(2)) is 
     amended to read as follows: ``Any funds reserved and 
     allocated under this paragraph but not used within a State 
     shall, to the extent necessary to satisfy pending 
     applications under this title, be available for use by 
     socially disadvantaged farmers and ranchers in other States, 
     as determined by the Secretary, and any remaining funds shall 
     be reallocated within the State.''.

     SEC. 5316. WAIVER OF BORROWER TRAINING CERTIFICATION 
                   REQUIREMENT.

       Section 359 of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 2006a) is amended by striking subsection (f) 
     and inserting the following:
       ``(f) Waivers.--
       ``(1) In general.--The Secretary may waive the requirements 
     of this section for an individual borrower if the Secretary 
     determines that the borrower demonstrates adequate knowledge 
     in areas described in this section.
       ``(2) Criteria.--The Secretary shall establish criteria 
     providing for the application of paragraph (1) consistently 
     in all counties nationwide.''.

     SEC. 5317. TIMING OF LOAN ASSESSMENTS.

       Section 360(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 2006b(a)) is amended by striking 
     ``After an applicant is determined eligible for assistance 
     under this title by the appropriate county committee 
     established pursuant to section 332, the'' and inserting 
     ``The''.

     SEC. 5318. ANNUAL REVIEW OF BORROWERS.

       Section 360(d)(1) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 2006b(d)(1)) is amended by striking 
     ``biannual'' and inserting ``annual''.

     SEC. 5319. LOAN ELIGIBILITY FOR BORROWERS WITH PRIOR DEBT 
                   FORGIVENESS.

       Section 373(b)(2)(A) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 2008h(b)(2)(A)) is amended--
       (1) in clause (i), by striking ``or'';
       (2) in clause (ii), by striking the period and inserting 
     ``; or''; and
       (3) by adding at the end the following:
       ``(iii) received debt forgiveness on not more than 1 
     occasion resulting directly and primarily from a major 
     disaster or emergency designated by the President on or after 
     April 4, 1996, under the Robert T. Stafford Disaster Relief 
     and Emergency Assistance Act (42 U.S.C. 5121 et seq.).''.

     SEC. 5320. MAKING AND SERVICING OF LOANS BY PERSONNEL OF 
                   STATE, COUNTY, OR AREA COMMITTEES.

       Subtitle D of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1981-2008j) is amended by adding at the end the 
     following:

     ``SEC. 376. MAKING AND SERVICING OF LOANS BY PERSONNEL OF 
                   STATE, COUNTY, OR AREA COMMITTEES.

       ``The Secretary shall use personnel of a State, county or 
     area committee established under section 8(b)(5) of the Soil 
     Conservation and Domestic Allotment Act (16 U.S.C 590h(b)(5)) 
     to make and service loans under this title to the extent the 
     personnel have been trained to do so.''.

     SEC. 5321. ELIGIBILITY OF EMPLOYEES OF STATE, COUNTY, OR AREA 
                   COMMITTEE FOR LOANS AND LOAN GUARANTEES.

       Subtitle D of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1981-2008j) is further amended by adding at the 
     end the following:

     ``SEC. 377. ELIGIBILITY OF EMPLOYEES OF STATE, COUNTY, OR 
                   AREA COMMITTEE FOR LOANS AND LOAN GUARANTEES.

       ``(a) In General.--The Secretary shall not prohibit an 
     employee of a State, county or area committee established 
     under section 8(b)(5) of the Soil Conservation and Domestic 
     Allotment Act (16 U.S.C. 590h(b)(5)) or an employee of the 
     Department of Agriculture from obtaining a loan or loan 
     guarantee under subtitle A, B or C of this title.
       ``(b) Approvals.--
       ``(1) County or area office.--In the case of a loan 
     application from an employee in a county or area office, the 
     Farm Service Agency State office shall be responsible for 
     reviewing and approving the application.
       ``(2) State office.--In the case of a loan application from 
     an employee of a State office, the Farm Service Agency 
     national office shall be responsible for reviewing and 
     approving the application.''.
                        Subtitle E--Farm Credit

     SEC. 5401. REPEAL OF BURDENSOME APPROVAL REQUIREMENTS.

       (a) Banks for Cooperatives.--Section 3.1(11)(B) of the Farm 
     Credit Act of 1971 (12 U.S.C. 2122(11)(B)) is amended--
       (1) by striking clause (iii); and
       (2) by redesignating clause (iv) as clause (iii).
       (b) Other System Banks; Associations.--Section 4.18A of the 
     Farm Credit Act of 1971 (12 U.S.C. 2206a) is amended--
       (1) in subsection (a)(1), by striking ``3.1(11)(B)(iv)'' 
     and inserting ``3.1(11)(B)(iii)''; and
       (2) by striking subsection (c).

     SEC. 5402. BANKS FOR COOPERATIVES.

       Section 3.7(b) of the Farm Credit Act of 1971 (12 U.S.C. 
     2128(b)) is amended--

[[Page H1852]]

       (1) in paragraphs (1) and (2)(A)(i), by striking ``farm 
     supplies'' each place it appears and inserting ``agricultural 
     supplies''; and
       (2) by adding at the end the following:
       ``(4) Definition of agricultural supply.--In this 
     subsection, the term `agricultural supply' includes--
       ``(A) a farm supply; and
       ``(B)(i) agriculture-related processing equipment;
       ``(ii) agriculture-related machinery; and
       ``(iii) other capital goods related to the storage or 
     handling of agricultural commodities or products.''.

     SEC. 5403. INSURANCE CORPORATION PREMIUMS.

       (a) Reduction in Premiums for GSE-Guaranteed Loans.--
       (1) In general.--Section 5.55 of the Farm Credit Act of 
     1971 (12 U.S.C. 2277a-4) is amended--
       (A) in subsection (a)--
       (i) in paragraph (1)--

       (I) in subparagraph (A), by striking ``government-
     guaranteed loans provided for in subparagraph (C)'' and 
     inserting ``loans provided for in subparagraphs (C) and 
     (D)'';
       (II) in subparagraph (B), by striking ``and'' at the end;
       (III) in subparagraph (C), by striking the period at the 
     end and inserting ``; and''; and
       (IV) by adding at the end the following:

       ``(D) the annual average principal outstanding for such 
     year on the guaranteed portions of Government Sponsored 
     Enterprise-guaranteed loans made by the bank that are in 
     accrual status, multiplied by a factor, not to exceed 0.0015, 
     determined by the Corporation at the sole discretion of the 
     Corporation.''; and
       (ii) by adding at the end the following:
       ``(4) Definition of government sponsored enterprise-
     guaranteed loan.--In this section and sections 1.12(b) and 
     5.56(a), the term `Government Sponsored Enterprise-guaranteed 
     loan' means a loan or credit, or portion of a loan or credit, 
     that is guaranteed by an entity that is chartered by Congress 
     to serve a public purpose and the debt obligations of which 
     are not explicitly guaranteed by the United States, including 
     the Federal National Mortgage Association, the Federal Home 
     Loan Mortgage Corporation, the Federal Home Loan Bank System, 
     and the Federal Agricultural Mortgage Corporation, but not 
     including any other institution of the Farm Credit System.''; 
     and
       (B) in subsection (e)(4)(B), by striking ``government-
     guaranteed loans described in subsection (a)(1)(C)'' and 
     inserting ``loans described in subparagraph (C) or (D) of 
     subsection (a)(1)''.
       (2) Conforming amendments.--
       (A) Section 1.12(b) of the Farm Credit Act of 1971 (12 
     U.S.C. 2020(b)) is amended--
       (i) in paragraph (1), by inserting ``and Government 
     Sponsored Enterprise-guaranteed loans (as defined in section 
     5.55(a)(4)) provided for in paragraph (4)'' after 
     ``government-guaranteed loans (as defined in section 
     5.55(a)(3)) provided for in paragraph (3)'';
       (ii) in paragraph (2), by striking ``and'' at the end;
       (iii) in paragraph (3), by striking the period at the end 
     and inserting ``; and''; and
       (iv) by adding at the end the following:
       ``(4) the annual average principal outstanding for such 
     year on the guaranteed portions of Government Sponsored 
     Enterprise-guaranteed loans (as so defined) made by the 
     association, or by the other financing institution and funded 
     by or discounted with the Farm Credit Bank, that are in 
     accrual status, multiplied by a factor, not to exceed 0.0015, 
     determined by the Corporation for the purpose of setting the 
     premium for such guaranteed portions of loans under section 
     5.55(a)(1)(D).''.
       (B) Section 5.56(a) of the Farm Credit Act of 1971 (12 
     U.S.C. 2277a-5(a)) is amended--
       (i) in paragraph (1), by inserting ``and Government 
     Sponsored Enterprise-guaranteed loans (as defined in section 
     5.55(a)(4))'' after ``government-guaranteed loans'';
       (ii) by redesignating paragraphs (4) and (5) as paragraphs 
     (5) and (6), respectively; and
       (iii) by inserting after paragraph (3) the following:
       ``(4) the annual average principal outstanding on the 
     guaranteed portions of Government Sponsored Enterprise-
     guaranteed loans (as defined in section 5.55(a)(4)) that are 
     in accrual status;''.
       (b) Applicability.--The amendments made by this section 
     shall apply with respect to determinations of premiums for 
     calendar year 2002 and for any succeeding calendar year, and 
     to certified statements with respect to such premiums.
                     Subtitle F--General Provisions

     SEC. 5501. TECHNICAL AMENDMENTS.

       (a) Section 321(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1961(a)) is amended by striking 
     ``Disaster Relief and Emergency Assistance Act'' each place 
     it appears and inserting ``Robert T. Stafford Disaster Relief 
     and Emergency Assistance Act (42 U.S.C. 5121 et seq.)''.
       (b) Section 336(b) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1986(b)) is amended in the second 
     sentence by striking ``provided for in section 332 of this 
     title''.
       (c) Section 359(c)(1) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 2006a(c)(1)) is amended by striking 
     ``established pursuant to section 332,''.
                      TITLE VI--RURAL DEVELOPMENT
        Subtitle A--Consolidated Farm and Rural Development Act

     SEC. 6001. ELIGIBILITY OF RURAL EMPOWERMENT ZONES AND RURAL 
                   ENTERPRISE COMMUNITIES FOR DIRECT AND 
                   GUARANTEED LOANS FOR ESSENTIAL COMMUNITY 
                   FACILITIES.

       Section 306(a)(1) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1926(a)(1)) is amended by inserting 
     after the first sentence the following: ``The Secretary may 
     also make or insure loans to communities that have been 
     designated as rural empowerment zones or rural enterprise 
     communities pursuant to part I of subchapter U of chapter 1 
     of the Internal Revenue Code of 1986, or as rural enterprise 
     communities pursuant to section 766 of the Agriculture, Rural 
     Development, Food and Drug Administration, and Related 
     Agencies Appropriations Act, 1999 (Public Law 105-277; 112 
     Stat. 2681, 2681-37), to provide for the installation or 
     improvement of essential community facilities including 
     necessary related equipment, and to furnish financial 
     assistance or other aid in planning projects for such 
     purposes.''.

     SEC. 6002. WATER OR WASTE DISPOSAL GRANTS.

       Section 306(a)(2) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1926(a)(2)) is amended--
       (1) by striking ``(2) The'' and inserting the following:
       ``(2) Water, waste disposal, and wastewater facility 
     grants.--
       ``(A) Authority.--
       ``(i) In general.--The'';
       (2) by striking ``aggregating not to exceed $590,000,000 in 
     any fiscal year'';
       (3) by striking ``The amount'' and inserting the following:
       ``(ii) Amount.--The amount'';
       (4) by striking ``paragraph'' and inserting 
     ``subparagraph'';
       (5) by striking ``The Secretary shall'' and inserting the 
     following:
       ``(iii) Grant rate.--The Secretary shall''; and
       (6) by adding at the end the following:
       ``(B) Revolving funds for financing water and wastewater 
     projects.--
       ``(i) In general.--The Secretary may make grants to 
     qualified private, nonprofit entities to capitalize revolving 
     funds for the purpose of providing financing to eligible 
     entities for--

       ``(I) predevelopment costs associated with proposed water 
     and wastewater projects or with existing water and wastewater 
     systems; and
       ``(II) short-term costs incurred for replacement equipment, 
     small-scale extension services, or other small capital 
     projects that are not part of the regular operations and 
     maintenance activities of existing water and wastewater 
     systems.

       ``(ii) Eligible entities.--To be eligible to obtain 
     financing from a revolving fund under clause (i), an eligible 
     entity must be eligible to obtain a loan, loan guarantee, or 
     grant under paragraph (1) or this paragraph.
       ``(iii) Maximum amount of financing.--The amount of 
     financing made to an eligible entity under this subparagraph 
     shall not exceed--

       ``(I) $100,000 for costs described in clause (i)(I); and
       ``(II) $100,000 for costs described in clause (i)(II).

       ``(iv) Term.--The term of financing provided to an eligible 
     entity under this subparagraph shall not exceed 10 years.
       ``(v) Administration.--The Secretary shall limit the amount 
     of grant funds that may be used by a grant recipient for 
     administrative costs incurred under this subparagraph.
       ``(vi) Annual report.--A nonprofit entity receiving a grant 
     under this subparagraph shall submit to the Secretary an 
     annual report that describes the number and size of 
     communities served and the type of financing provided.
       ``(vii) Authorization of appropriations.--There are 
     authorized to be appropriated to carry out this subparagraph 
     $30,000,000 for each of fiscal years 2002 through 2007.''.

     SEC. 6003. RURAL BUSINESS OPPORTUNITY GRANTS.

       Section 306(a)(11)(D) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1926(a)(11)(D)) is amended--
       (1) by striking ``$7,500,000'' and inserting 
     ``$15,000,000''; and
       (2) by striking ``2002'' and inserting ``2007''.

     SEC. 6004. CHILD DAY CARE FACILITIES.

       Section 306(a)(19) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1926(a)(19)) is amended by adding 
     at the end the following:
       ``(C) Reservation of funds for child day care facilities.--
       ``(i) In general.--For each fiscal year, not less than 10 
     percent of the funds made available to carry out this 
     paragraph shall be reserved for grants to pay the Federal 
     share of the cost of developing and constructing day care 
     facilities for children in rural areas.
       ``(ii) Release.--Funds reserved under clause (i) for a 
     fiscal year shall be reserved only until April 1 of the 
     fiscal year.''.

     SEC. 6005. RURAL WATER AND WASTEWATER CIRCUIT RIDER PROGRAM.

       Section 306(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1926(a)) is amended by adding at 
     the end the following:
       ``(22) Rural water and wastewater circuit rider program.--
       ``(A) In general.--The Secretary shall establish a national 
     rural water and wastewater circuit rider program that is 
     based on the rural water circuit rider program of the 
     National Rural Water Association that (as of the date of 
     enactment of this paragraph) receives funding from the 
     Secretary, acting through the Rural Utilities Service.
       ``(B) Relationship to existing program.--The program 
     established under subparagraph (A) shall not affect the 
     authority of the Secretary to carry out the circuit rider 
     program for which funds are made available under the heading 
     ``rural community advancement program'' in title III of the 
     Agriculture, Rural Development, Food and Drug Administration, 
     and Related Agencies Appropriations Act, 2002 (115 Stat. 
     719).
       ``(C) Authorization of appropriations.--There is authorized 
     to be appropriated to carry

[[Page H1853]]

     out this paragraph $15,000,000 for fiscal year 2003 and each 
     fiscal year thereafter.''.

     SEC. 6006. MULTIJURISDICTIONAL REGIONAL PLANNING 
                   ORGANIZATIONS.

       Section 306(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1926(a)) (as amended by section 
     6005) is amended by adding at the end the following:
       ``(23) Multijurisdictional regional planning 
     organizations.--
       ``(A) Grants.--The Secretary shall provide grants to 
     multijurisdictional regional planning and development 
     organizations to pay the Federal share of the cost of 
     providing assistance to local governments to improve the 
     infrastructure, services, and business development 
     capabilities of local governments and local economic 
     development organizations.
       ``(B) Priority.--In determining which organizations will 
     receive a grant under this paragraph, the Secretary shall 
     give priority to an organization that--
       ``(i) serves a rural area that, during the most recent 5-
     year period--

       ``(I) had a net out-migration of inhabitants, or other 
     population loss, from the rural area that equals or exceeds 5 
     percent of the population of the rural area; or
       ``(II) had a median household income that is less than the 
     nonmetropolitan median household income of the applicable 
     State; and

       ``(ii) has a history of providing substantive assistance to 
     local governments and economic development organizations.
       ``(C) Federal share.--A grant provided under this paragraph 
     shall be for not more than 75 percent of the cost of 
     providing assistance described in subparagraph (A).
       ``(D) Maximum amount of grants.--The amount of a grant 
     provided to an organization under this paragraph shall not 
     exceed $100,000.
       ``(E) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this paragraph $30,000,000 
     for each of fiscal years 2003 through 2007.''.

     SEC. 6007. LOAN GUARANTEES FOR CERTAIN RURAL DEVELOPMENT 
                   LOANS.

       (a) Loan Guarantees for Water, Wastewater, and Essential 
     Community Facilities Loans.--Section 306(a) of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 
     1925(a)) (as amended by section 6006) is amended by adding at 
     the end the following:
       ``(24) Loan guarantees for water, wastewater, and essential 
     community facilities loans.--
       ``(A) In general.--The Secretary may guarantee a loan made 
     to finance a community facility or water or waste facility 
     project in a rural area, including a loan financed by the net 
     proceeds of a bond described in section 142(a) of the 
     Internal Revenue Code of 1986.
       ``(B) Requirements.--To be eligible for a loan guarantee 
     under subparagraph (A), an individual or entity offering to 
     purchase the loan shall demonstrate to the Secretary that the 
     person has--
       ``(i) the capabilities and resources necessary to service 
     the loan in a manner that ensures the continued performance 
     of the loan, as determined by the Secretary; and
       ``(ii) the ability to generate capital to provide borrowers 
     of the loan with the additional credit necessary to properly 
     service the loan.''.
       (b) Loan Guarantees for Certain Loans.--Section 310B of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 1932) 
     is amended by adding at the end the following:
       ``(h) Loan Guarantees for Certain Loans.--The Secretary may 
     guarantee loans made under subsection (a) to finance the 
     issuance of bonds for the projects described in section 
     306(a)(24).''.

     SEC. 6008. TRIBAL COLLEGE AND UNIVERSITY ESSENTIAL COMMUNITY 
                   FACILITIES.

       Section 306(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1926(a)) (as amended by section 
     6007(a)) is amended by adding at the end the following:
       ``(25) Tribal college and university essential community 
     facilities.--
       ``(A) In general.--The Secretary may make grants to tribal 
     colleges and universities (as defined in section 316 of the 
     Higher Education Act of 1965 (20 U.S.C. 1059c)) to provide 
     the Federal share of the cost of developing specific tribal 
     college or university essential community facilities in rural 
     areas.
       ``(B) Federal share.--
       ``(i) In general.--Except as provided in clauses (ii) and 
     (iii), the Secretary shall, by regulation, establish the 
     maximum percentage of the cost of the facility that may be 
     covered by a grant under this paragraph.
       ``(ii) Maximum amount.--The amount of a grant provided 
     under this paragraph for a facility shall not exceed 75 
     percent of the cost of developing the facility.
       ``(iii) Graduated scale.--The Secretary shall provide for a 
     graduated scale of the percentages of the cost covered by a 
     grant made under this paragraph that provides higher 
     percentages for facilities in communities that have lower 
     community population and income levels, as determined by the 
     Secretary.
       ``(C) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this paragraph $10,000,000 
     for each of fiscal years 2003 through 2007.''.

     SEC. 6009. EMERGENCY AND IMMINENT COMMUNITY WATER ASSISTANCE 
                   GRANT PROGRAM.

       Section 306A of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1926a) is amended--
       (1) in the section heading, by inserting ``and imminent'' 
     after ``emergency'';
       (2) in subsection (a)--
       (A) in paragraph (1), by inserting ``, or when such a 
     decline is imminent'' before the semicolon at the end; and
       (B) in paragraph (2)--
       (i) in subparagraph (A), by striking ``acute'' and 
     inserting ``acute, or imminent,''; and
       (ii) in subparagraph (B), by striking ``decline'' and 
     inserting ``decline, or imminent decline,'';
       (3) in subsection (c)(2), by striking ``occurred'' and 
     inserting ``occurred, or will occur,'';
       (4) in subsection (d), by striking paragraph (1) and 
     inserting the following:
       ``(1) In general.--Grants made under this section may be 
     used--
       ``(A) for waterline extensions from existing systems, 
     laying of new waterlines, repairs, significant maintenance, 
     digging of new wells, equipment replacement, and hook and tap 
     fees;
       ``(B) for any other appropriate purpose associated with 
     developing sources of, treating, storing, or distributing 
     water;
       ``(C) to assist communities in complying with the 
     requirements of the Federal Water Pollution Control Act (33 
     U.S.C. 1251 et seq.) or the Safe Drinking Water Act (42 
     U.S.C. 300f et seq.); and
       ``(D) to provide potable water to communities through other 
     means.'';
       (5) in subsection (f)(2), by striking ``$75,000'' and 
     inserting ``$150,000'';
       (6) in subsection (h)--
       (A) in the second sentence of paragraph (1), by striking 
     ``decline'' and inserting ``decline, or imminent decline,''; 
     and
       (B) by striking paragraph (2) and inserting the following:
       ``(2) Timing of review of applications.--
       ``(A) Simplified application.--The application process 
     developed by the Secretary under paragraph (1) shall include 
     a simplified application form that will permit expedited 
     consideration of an application for a grant filed under this 
     section.
       ``(B) Priority review.--In processing applications for any 
     water or waste grant or loan authorized under this title, the 
     Secretary shall afford priority processing to an application 
     for a grant under this section to the extent funds will be 
     available for an award on the application at the conclusion 
     of priority processing.
       ``(C) Timing.--The Secretary shall, to the maximum extent 
     practicable, review and act on an application under this 
     section within 60 days after the date on which the 
     application is submitted to the Secretary.''; and
       (7) by striking subsection (i) and inserting the following:
       ``(i) Funding.--
       ``(1) Reservation.--
       ``(A) In general.--For each fiscal year, not less than 3 
     nor more than 5 percent of the total amount made available to 
     carry out section 306(a)(2) for the fiscal year shall be 
     reserved for grants under this section.
       ``(B) Release.--Funds reserved under subparagraph (A) for a 
     fiscal year shall be reserved only until July 1 of the fiscal 
     year.
       ``(2) Authorization of appropriations.--In addition to 
     funds made available under paragraph (1), there is authorized 
     to be appropriated to carry out this section $35,000,000 for 
     each of fiscal years 2003 through 2007.''.

     SEC. 6010. WATER AND WASTE FACILITY GRANTS FOR NATIVE 
                   AMERICAN TRIBES.

       Section 306C of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1926c) is amended by striking subsection (e) 
     and inserting the following:
       ``(e) Authorization of Appropriations.--
       ``(1) In general.--Subject to paragraph (2), there are 
     authorized to be appropriated--
       ``(A) for grants under this section, $30,000,000 for each 
     fiscal year;
       ``(B) for loans under this section, $30,000,000 for each 
     fiscal year; and
       ``(C) in addition to grants provided under subparagraph 
     (A), for grants under this section to benefit Indian tribes 
     (as defined in section 4 of the Indian Self-Determination and 
     Education Assistance Act (25 U.S.C. 450b)), $20,000,000 for 
     each fiscal year.
       ``(2) Exception.--An entity eligible to receive funding 
     through a grant made under section 306D shall not be eligible 
     for a grant from funds made available under paragraph 
     (1)(C).''.

     SEC. 6011. GRANTS FOR WATER SYSTEMS FOR RURAL AND NATIVE 
                   VILLAGES IN ALASKA.

       Section 306D(d)(1) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1926d(d)(1)) is amended by striking 
     ``and 2002'' and inserting ``through 2007''.

     SEC. 6012. GRANTS TO NONPROFIT ORGANIZATIONS TO FINANCE THE 
                   CONSTRUCTION, REFURBISHING, AND SERVICING OF 
                   INDIVIDUALLY-OWNED HOUSEHOLD WATER WELL SYSTEMS 
                   IN RURAL AREAS FOR INDIVIDUALS WITH LOW OR 
                   MODERATE INCOMES.

       (a) In General.--The Consolidated Farm and Rural 
     Development Act is amended by inserting after section 306D (7 
     U.S.C. 1926d) the following:

     ``SEC. 306E. GRANTS TO NONPROFIT ORGANIZATIONS TO FINANCE THE 
                   CONSTRUCTION, REFURBISHING, AND SERVICING OF 
                   INDIVIDUALLY-OWNED HOUSEHOLD WATER WELL SYSTEMS 
                   IN RURAL AREAS FOR INDIVIDUALS WITH LOW OR 
                   MODERATE INCOMES.

       ``(a) Definition of Eligible Individual.--In this section, 
     the term `eligible individual' means an individual who is a 
     member of a household the members of which have a combined 
     income (for the most recent 12-month period for which the 
     information is available) that is not more than 100 percent 
     of the median nonmetropolitan household income for the State 
     or territory in which the individual resides, according to 
     the most recent decennial census of the United States.
       ``(b) Grants.--
       ``(1) In general.--The Secretary may make grants to private 
     nonprofit organizations for the purpose of providing loans to 
     eligible individuals for the construction, refurbishing, and 
     servicing of individual household water well systems in rural 
     areas that are or will be owned by the eligible individuals.

[[Page H1854]]

       ``(2) Terms of loans.--A loan made with grant funds under 
     this section--
       ``(A) shall have an interest rate of 1 percent;
       ``(B) shall have a term not to exceed 20 years; and
       ``(C) shall not exceed $8,000 for each water well system 
     described in paragraph (1).
       ``(3) Administrative expenses.--A recipient of a grant made 
     under this section may use grant funds to pay administrative 
     expenses associated with providing the assistance described 
     in paragraph (1), as determined by the Secretary.
       ``(c) Priority in Awarding Grants.--In awarding grants 
     under this section, the Secretary shall give priority to an 
     applicant that has substantial expertise and experience in 
     promoting the safe and productive use of individually-owned 
     household water well systems and ground water.
       ``(d) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $10,000,000 for 
     each of fiscal years 2003 through 2007.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     takes effect on October 1, 2002.

     SEC. 6013. LOANS AND LOAN GUARANTEES FOR RENEWABLE ENERGY 
                   SYSTEMS.

       Section 310B(a)(3) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1932(a)(3)) is amended by inserting 
     ``and other renewable energy systems (including wind energy 
     systems and anaerobic digestors for the purpose of energy 
     generation)'' after ``solar energy systems''.

     SEC. 6014. RURAL BUSINESS ENTERPRISE GRANTS.

       Section 310B(c)(1) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1932(c)(1)) is amended--
       (1) by striking ``(1) In General.--The Secretary'' and 
     inserting the following:
       ``(1) Grants.--
       ``(A) In general.--The Secretary''; and
       (2) by adding at the end the following:
       ``(B) Small and emerging private business enterprises.--
       ``(i) In general.--For the purpose of subparagraph (A), a 
     small and emerging private business enterprise shall include 
     (regardless of the number of employees or operating capital 
     of the enterprise) an eligible nonprofit entity, or other 
     tax-exempt organization, with a principal office in an area 
     that is located--

       ``(I) on land of an existing or former Native American 
     reservation; and
       ``(II) in a city, town, or unincorporated area that has a 
     population of not more than 5,000 inhabitants.

       ``(ii) Use of grant.--An eligible nonprofit entity, or 
     other tax exempt organization, described in clause (i) may 
     use assistance provided under this paragraph to create, 
     expand, or operate value-added processing in an area 
     described in clause (i) in connection with production 
     agriculture.
       ``(iii) Priority.--In making grants under this paragraph, 
     the Secretary shall give priority to grants that will be used 
     to provide assistance to eligible nonprofit entities and 
     other tax exempt organizations described in clause (i).''.

     SEC. 6015. RURAL COOPERATIVE DEVELOPMENT GRANTS.

       Section 310B(e) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1932(e)) is amended--
       (1) in paragraph (5)(F), before the period at the end the 
     following: ``, except that the Secretary shall not require 
     non-Federal financial support in an amount that is greater 
     than 5 percent in the case of a 1994 institution (as defined 
     in section 532 of the Equity in Educational Land-Grant Status 
     Act of 1994 (7 U.S.C. 301 note; Public Law 103-382))''; and
       (2) in paragraph (9), by striking ``2002'' and inserting 
     ``2007''.

     SEC. 6016. GRANTS TO BROADCASTING SYSTEMS.

       Section 310B(f) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1932(f)) is amended by adding at 
     the end the following:
       ``(3) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection $5,000,000 
     for each of fiscal years 2002 through 2007.''.

     SEC. 6017. BUSINESS AND INDUSTRY LOAN MODIFICATIONS.

       Section 310B of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1932) is amended by striking subsection (g) and 
     inserting the following:
       ``(g) Business and Industry Direct and Guaranteed Loans.--
       ``(1) Definition of business and industry loan.--In this 
     subsection, the term `business and industry loan' means a 
     business and industry direct or guaranteed loan that is made 
     or guaranteed by the Secretary under subsection (a)(1).
       ``(2) Loan guarantees for the purchase of cooperative 
     stock.--
       ``(A) In general.--The Secretary may guarantee a business 
     and industry loan to individual farmers or ranchers for the 
     purpose of purchasing capital stock of a farmer or rancher 
     cooperative established for the purpose of processing an 
     agricultural commodity.
       ``(B) Processing contracts during initial period.--A 
     cooperative described in subparagraph (A) for which a farmer 
     or rancher receives a guarantee to purchase stock under 
     subparagraph (A) may contract for services to process 
     agricultural commodities, or otherwise process value-added 
     agricultural products, during the 5-year period beginning on 
     the date of the startup of the cooperative in order to 
     provide adequate time for the planning and construction of 
     the processing facility of the cooperative.
       ``(C) Financial information.--Financial information 
     required by the Secretary from a farmer or rancher as a 
     condition of making a business and industry loan guarantee 
     under this paragraph shall be provided in the manner 
     generally required by commercial agricultural lenders in the 
     area.
       ``(3) Loans to cooperatives.--
       ``(A) In general.--The Secretary may make or guarantee a 
     business and industry loan to a cooperative organization that 
     is headquartered in a metropolitan area if the loan is used 
     for a project or venture described in subsection (a) that is 
     located in a rural area or a loan guarantee that meets the 
     requirements of paragraph (6).
       ``(B) Refinancing.--A cooperative organization that is 
     eligible for a business and industry loan shall be eligible 
     to refinance an existing business and industry loan with a 
     lender if--
       ``(i) the cooperative organization--

       ``(I) is current and performing with respect to the 
     existing loan; and
       ``(II) is not, and has not been, in payment default, or the 
     collateral of which has not been converted, with respect to 
     the existing loan; and

       ``(ii) there is adequate security or full collateral for 
     the refinanced loan.
       ``(4) Loan appraisals.--The Secretary may require that any 
     appraisal made in connection with a business and industry 
     loan be conducted by a specialized appraiser that uses 
     standards that are similar to standards used for similar 
     purposes in the private sector, as determined by the 
     Secretary.
       ``(5) Fees.--The Secretary may assess a 1-time fee for any 
     guaranteed business and industry loan in an amount that does 
     not exceed 2 percent of the guaranteed principal portion of 
     the loan.
       ``(6) Loan guarantees in nonrural areas.--
       ``(A) In general.--The Secretary may guarantee a business 
     and industry loan to a cooperative organization for a 
     facility that is not located in a rural area if--
       ``(i) the primary purpose of the loan guarantee is for a 
     facility to provide value-added processing for agricultural 
     producers that are located within 80 miles of the facility;
       ``(ii) the applicant demonstrates to the Secretary that the 
     primary benefit of the loan guarantee will be to provide 
     employment for residents of a rural area; and
       ``(iii) the total amount of business and industry loans 
     guaranteed for a fiscal year under this paragraph does not 
     exceed 10 percent of the business and industry loans 
     guaranteed for the fiscal year under subsection (a)(1).
       ``(B) Principal amounts.--The principal amount of a 
     business and industry loan guaranteed under this paragraph 
     may not exceed $25,000,000.
       ``(7) Intangible assets.--In determining whether a 
     cooperative organization is eligible for a guaranteed 
     business and industry loan, the Secretary may consider the 
     market value of a properly appraised brand name, patent, or 
     trademark of the cooperative.
       ``(8) Limitations on loan guarantees for cooperative 
     organizations.--
       ``(A) Principal amount.--
       ``(i) In general.--Subject to clause (ii), the principal 
     amount of a business and industry loan made to a cooperative 
     organization and guaranteed under this subsection shall not 
     exceed $40,000,000.
       ``(ii) Use.--To be eligible for a guarantee under this 
     subsection for a business and industry loan made to a 
     cooperative organization, the principal amount of the any 
     such loan in excess of $25,000,000 shall be used to carry out 
     a project--

       ``(I) in a rural area; and
       ``(II) that provides for the value-added processing of 
     agricultural commodities.

       ``(B) Applications.--If a cooperative organization submits 
     an application for a guarantee under this subsection of a 
     business and industry loan with a principal amount that is in 
     excess of $25,000,000, the Secretary--
       ``(i) shall review and, if appropriate, approve the 
     application; and
       ``(ii) may not delegate the approval authority.
       ``(C) Maximum amount.--The total amount of business and 
     industry loans made to cooperative organizations and 
     guaranteed for a fiscal year under this subsection with 
     principal amounts that are in excess of $25,000,000 may not 
     exceed 10 percent of the business and industry loans 
     guaranteed for the fiscal year under subsection (a)(1).''.

     SEC. 6018. USE OF RURAL DEVELOPMENT LOANS AND GRANTS FOR 
                   OTHER PURPOSES.

       Subtitle A of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1921 et seq.) (as amended by section 5006) is 
     amended by adding at the end the following:

     ``SEC. 310G. USE OF RURAL DEVELOPMENT LOANS AND GRANTS FOR 
                   OTHER PURPOSES.

       ``If, after making a loan or a grant described in section 
     381E(d), the Secretary determines that the circumstances 
     under which the loan or grant was made have sufficiently 
     changed to make the project or activity for which the loan or 
     grant was made available no longer appropriate, the Secretary 
     may allow the loan borrower or grant recipient to use 
     property (real and personal) purchased or improved with the 
     loan or grant funds, or proceeds from the sale of property 
     (real and personal) purchased with such funds, for another 
     project or activity that (as determined by the Secretary)--
       ``(1) will be carried out in the same area as the original 
     project or activity;
       ``(2) meets the criteria for a loan or a grant described in 
     section 381E(d); and
       ``(3) satisfies such additional requirements as are 
     established by the Secretary.''.

     SEC. 6019. SIMPLIFIED APPLICATION FORMS FOR LOAN GUARANTEES.

       Section 333A of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1983a) (as amended by section 5307) is amended 
     by striking subsection (g) and inserting the following:
       ``(g) Simplified Application Forms for Loan Guarantees.--
       ``(1) In general.--The Secretary shall provide to lenders a 
     short, simplified application form for guarantees under this 
     title of--

[[Page H1855]]

       ``(A) farmer program loans the principal amount of which is 
     $125,000 or less; and
       ``(B) business and industry guaranteed loans under section 
     310B(a)(1) the principal amount of which is--
       ``(i) in the case of a loan guarantee made during fiscal 
     year 2002 or 2003, $400,000 or less; and
       ``(ii) in the case of a loan guarantee made during any 
     subsequent fiscal year--

       ``(I) $400,000 or less; or

       ``(II) if the Secretary determines that there is not a 
     significant increased risk of a default on the loan, $600,000 
     or less.

       ``(2) Water and waste disposal grants and loans.--The 
     Secretary shall develop an application process that 
     accelerates, to the maximum extent practicable, the 
     processing of applications for water and waste disposal 
     grants or direct or guaranteed loans under paragraph (1) or 
     (2) of section 306(a) the grant award amount or principal 
     loan amount, respectively, of which is $300,000 or less.
       ``(3) Administration.--In developing an application under 
     this subsection, the Secretary shall--
       ``(A) consult with commercial and cooperative lenders; and
       ``(B) ensure that--
       ``(i) the form can be completed manually or electronically, 
     at the option of the lender;
       ``(ii) the form minimizes the documentation required to 
     accompany the form;
       ``(iii) the cost of completing and processing the form is 
     minimal; and
       ``(iv) the form can be completed and processed in an 
     expeditious manner.''.

     SEC. 6020. DEFINITION OF RURAL AND RURAL AREA.

       (a) In General.--Section 343(a) of the Consolidated Farm 
     and Rural Development Act (7 U.S.C. 1991(a)) is amended by 
     adding at the end the following:
       ``(13) Rural and rural area.--
       ``(A) In general.--Except as otherwise provided in this 
     paragraph, the terms `rural' and `rural area' mean any area 
     other than--
       ``(i) a city or town that has a population of greater than 
     50,000 inhabitants; and
       ``(ii) the urbanized area contiguous and adjacent to such a 
     city or town.
       ``(B) Water and waste disposal grants and direct and 
     guaranteed loans.--For the purpose of water and waste 
     disposal grants and direct and guaranteed loans provided 
     under paragraphs (1), (2), and (24) of section 306(a), the 
     terms `rural' and `rural area' mean a city, town, or 
     unincorporated area that has a population of no more than 
     10,000 inhabitants.
       ``(C) Community facility loans and grants.--For the purpose 
     of community facility direct and guaranteed loans and grants 
     under paragraphs (1), (19), (20), (21), and (24) of section 
     306(a), the terms `rural' and `rural area' mean a city, town, 
     or unincorporated area that has a population of not more than 
     20,000 inhabitants.
       ``(D) Multijurisdictional regional planning organizations; 
     national rural development partnership.--In sections 
     306(a)(23) and 378, the term `rural area' means--
       ``(i) all the territory of a State that is not within the 
     boundary of any standard metropolitan statistical area; and
       ``(ii) all territory within any standard metropolitan 
     statistical area within a census tract having a population 
     density of less than 20 persons per square mile, as 
     determined by the Secretary according to the most recent 
     census of the United States as of any date.
       ``(E) Rural business investment program.--In subtitle H, 
     the term `rural area' means an area that is located--
       ``(i) outside a standard metropolitan statistical area; or
       ``(ii) within a community that has a population of 50,000 
     inhabitants or less.''.
       (b) Conforming Amendments.--
       (1) Section 306(a) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 1926(a)) is amended by striking 
     paragraph (7).
       (2) Section 381A of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 2009) is amended--
       (A) by striking paragraph (1); and
       (B) by redesignating paragraphs (2) and (3) as paragraphs 
     (1) and (2), respectively.
       (3) Section 735 of the Agriculture, Rural Development, Food 
     and Drug Administration, and Related Agencies Appropriations 
     Act, 1999 (112 Stat. 2681-29) is repealed.

     SEC. 6021. NATIONAL RURAL DEVELOPMENT PARTNERSHIP.

       Subtitle D of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1981 et seq.) (as amended by section 5321) is 
     amended by adding at the end the following:

     ``SEC. 378. NATIONAL RURAL DEVELOPMENT PARTNERSHIP.

       ``(a) Definitions.--In this section:
       ``(1) Agency with rural responsibilities.--The term `agency 
     with rural responsibilities' means any executive agency (as 
     defined in section 105 of title 5, United States Code) that 
     implements a Federal law, or administers a program, targeted 
     at or having a significant impact on rural areas.
       ``(2) Coordinating committee.--The term `Coordinating 
     Committee' means the National Rural Development Coordinating 
     Committee established by subsection (c).
       ``(3) Partnership.--The term `Partnership' means the 
     National Rural Development Partnership continued by 
     subsection (b).
       ``(4) State rural development council.--The term `State 
     rural development council' means a State rural development 
     council that meets the requirements of subsection (d).
       ``(b) Partnership.--
       ``(1) In general.--The Secretary shall continue the 
     National Rural Development Partnership composed of--
       ``(A) the Coordinating Committee; and
       ``(B) State rural development councils.
       ``(2) Purposes.--The purposes of the Partnership are to 
     empower and build the capacity of States and rural 
     communities to design flexible and innovative responses to 
     their own special rural development needs, with local 
     determinations of progress and selection of projects and 
     activities.
       ``(3) Governing panel.--
       ``(A) In general.--A panel consisting of representatives of 
     the Coordinating Committee and State rural development 
     councils shall be established to lead and coordinate the 
     strategic operation, policies, and practices of the 
     Partnership.
       ``(B) Annual reports.--In conjunction with the Coordinating 
     Committee and State rural development councils, the panel 
     shall prepare and submit to Congress an annual report on the 
     activities of the Partnership.
       ``(4) Role of federal government.--The role of the Federal 
     Government in the Partnership may be that of a partner and 
     facilitator, with Federal agencies authorized--
       ``(A) to cooperate with States to implement the 
     Partnership;
       ``(B) to provide States with the technical and 
     administrative support necessary to plan and implement 
     tailored rural development strategies to meet local needs;
       ``(C) to ensure that the head of each agency with rural 
     responsibilities designates a senior-level agency official to 
     represent the agency on the Coordinating Committee and 
     directs appropriate field staff to participate fully with the 
     State rural development council within the jurisdiction of 
     the field staff; and
       ``(D) to enter into cooperative agreements with, and to 
     provide grants and other assistance to, the Coordinating 
     Committee and State rural development councils.
       ``(c) National Rural Development Coordinating Committee.--
       ``(1) Establishment.--The Secretary shall establish a 
     National Rural Development Coordinating Committee within the 
     Department of Agriculture.
       ``(2) Composition.--The Coordinating Committee shall be 
     composed of--
       ``(A) 1 representative of each agency with rural 
     responsibilities; and
       ``(B) representatives, approved by the Secretary, of--
       ``(i) national associations of State, regional, local, and 
     tribal governments and intergovernmental and 
     multijurisdictional agencies and organizations;
       ``(ii) national public interest groups;
       ``(iii) other national nonprofit organizations that elect 
     to participate in the activities of the Coordinating 
     Committee; and
       ``(iv) the private sector.
       ``(3) Duties.--The Coordinating Committee shall--
       ``(A) support the work of the State rural development 
     councils;
       ``(B) facilitate coordination of rural development 
     policies, programs, and activities among Federal agencies and 
     with those of State, local, and tribal governments, the 
     private sector, and nonprofit organizations;
       ``(C) review and comment on policies, regulations, and 
     proposed legislation that affect or would affect rural areas 
     and gather and provide related information;
       ``(D) develop and facilitate strategies to reduce or 
     eliminate administrative and regulatory impediments; and
       ``(E) require each State rural development council 
     receiving funds under this section to submit an annual report 
     on the use of the funds, including a description of strategic 
     plans, goals, performance measures, and outcomes for the 
     State rural development council of the State.
       ``(4) Federal participation in coordinating committee.--
       ``(A) In general.--A Federal employee shall fully 
     participate in the governance and operations of the 
     Coordinating Committee, including activities related to 
     grants, contracts, and other agreements, in accordance with 
     this section.
       ``(B) Conflicts.--Participation by a Federal employee in 
     the Coordinating Committee in accordance with this paragraph 
     shall not constitute a violation of section 205 or 208 of 
     title 18, United States Code.
       ``(5) Administrative support.--The Secretary may provide 
     such administrative support for the Coordinating Committee as 
     the Secretary determines is necessary to carry out the duties 
     of the Coordinating Committee.
       ``(6) Procedures.--The Secretary may prescribe such 
     regulations, bylaws, or other procedures as are necessary for 
     the operation of the Coordinating Committee.
       ``(d) State Rural Development Councils.--
       ``(1) Establishment.--Notwithstanding chapter 63 of title 
     31, United States Code, each State may elect to participate 
     in the Partnership by entering into an agreement with the 
     Secretary to recognize a State rural development council.
       ``(2) Composition.--A State rural development council 
     shall--
       ``(A) be composed of representatives of Federal, State, 
     local, and tribal governments, nonprofit organizations, 
     regional organizations, the private sector, and other 
     entities committed to rural advancement; and
       ``(B) have a nonpartisan and nondiscriminatory membership 
     that--
       ``(i) is broad and representative of the economic, social, 
     and political diversity of the State; and
       ``(ii) shall be responsible for the governance and 
     operations of the State rural development council.
       ``(3) Duties.--A State rural development council shall--
       ``(A) facilitate collaboration among Federal, State, local, 
     and tribal governments and the private and nonprofit sectors 
     in the planning and implementation of programs and policies 
     that have an impact on rural areas of the State;
       ``(B) monitor, report, and comment on policies and programs 
     that address, or fail to address, the needs of the rural 
     areas of the State;

[[Page H1856]]

       ``(C) as part of the Partnership, in conjunction with the 
     Coordinating Committee, facilitate the development of 
     strategies to reduce or eliminate conflicting or duplicative 
     administrative or regulatory requirements of Federal, State, 
     local, and tribal governments; and
       ``(D)(i) provide to the Coordinating Committee an annual 
     plan with goals and performance measures; and
       ``(ii) submit to the Coordinating Committee an annual 
     report on the progress of the State rural development council 
     in meeting the goals and measures.
       ``(4) Federal participation in state rural development 
     councils.--
       ``(A) In general.--A State Director for Rural Development 
     of the Department of Agriculture, other employees of the 
     Department, and employees of other Federal agencies with 
     rural responsibilities shall fully participate as voting 
     members in the governance and operations of State rural 
     development councils (including activities related to grants, 
     contracts, and other agreements in accordance with this 
     section) on an equal basis with other members of the State 
     rural development councils.
       ``(B) Conflicts.--Participation by a Federal employee in a 
     State rural development council in accordance with this 
     paragraph shall not constitute a violation of section 205 or 
     208 of title 18, United States Code.
       ``(e) Administrative Support of the Partnership.--
       ``(1) Detail of employees.--
       ``(A) In general.--In order to provide experience in 
     intergovernmental collaboration, the head of an agency with 
     rural responsibilities that elects to participate in the 
     Partnership may, and is encouraged to, detail to the 
     Secretary for the support of the Partnership 1 or more 
     employees of the agency with rural responsibilities without 
     reimbursement for a period of up to 1 year.
       ``(B) Civil service status.--The detail shall be without 
     interruption or loss of civil service status or privilege.
       ``(2) Additional support.--The Secretary may provide for 
     any additional support staff to the Partnership as the 
     Secretary determines to be necessary to carry out the duties 
     of the Partnership.
       ``(3) Intermediaries.--The Secretary may enter into a 
     contract with a qualified intermediary under which the 
     intermediary shall be responsible for providing 
     administrative and technical assistance to a State rural 
     development council, including administering the financial 
     assistance available to the State rural development council.
       ``(f) Matching Requirements for State Rural Development 
     Councils.--
       ``(1) In general.--Except as provided in paragraph (2), a 
     State rural development council shall provide matching funds, 
     or in-kind goods or services, to support the activities of 
     the State rural development council in an amount that is not 
     less than 33 percent of the amount of Federal funds received 
     from a Federal agency under subsection (g)(2).
       ``(2) Exceptions to matching requirement for certain 
     federal funds.--Paragraph (1) shall not apply to funds, 
     grants, funds provided under contracts or cooperative 
     agreements, gifts, contributions, or technical assistance 
     received by a State rural development council from a Federal 
     agency that are used--
       ``(A) to support 1 or more specific program or project 
     activities; or
       ``(B) to reimburse the State rural development council for 
     services provided to the Federal agency providing the funds, 
     grants, funds provided under contracts or cooperative 
     agreements, gifts, contributions, or technical assistance.
       ``(3) Department's share.--The Secretary shall develop a 
     plan to decrease, over time, the share of the Department of 
     Agriculture of the cost of the core operations of State rural 
     development councils.
       ``(g) Funding.--
       ``(1) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this section $10,000,000 for 
     each of fiscal years 2003 through 2007.
       ``(2) Federal agencies.--
       ``(A) In general.--Notwithstanding any other provision of 
     law limiting the ability of an agency, along with other 
     agencies, to provide funds to the Coordinating Committee or a 
     State rural development council in order to carry out the 
     purposes of this section, a Federal agency may make grants, 
     gifts, or contributions to, provide technical assistance to, 
     or enter into contracts or cooperative agreements with, the 
     Coordinating Committee or a State rural development council.
       ``(B) Assistance.--Federal agencies are encouraged to use 
     funds made available for programs that have an impact on 
     rural areas to provide assistance to, and enter into 
     contracts with, the Coordinating Committee or a State rural 
     development council, as described in subparagraph (A).
       ``(3) Contributions.--The Coordinating Committee and a 
     State rural development council may accept private 
     contributions.
       ``(h) Termination.--The authority provided under this 
     section shall terminate on the date that is 5 years after the 
     date of enactment of this section.''.

     SEC. 6022. RURAL TELEWORK.

       Subtitle D of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1981 et seq.) (as amended by section 6021) is 
     amended by adding at the end the following:

     ``SEC. 379. RURAL TELEWORK.

       ``(a) Definitions.--In this section:
       ``(1) Eligible organization.--The term `eligible 
     organization' means a nonprofit entity, an educational 
     institution, an Indian tribe (as defined in section 4 of the 
     Indian Self-Determination and Education Assistance Act (25 
     U.S.C. 450b)), or any other organization, in a rural area 
     (except for the institute), that meets the requirements of 
     this section and such other requirements as are established 
     by the Secretary.
       ``(2) Institute.--The term `institute' means a rural 
     telework institute established using a grant under subsection 
     (b).
       ``(3) Telework.--The term `telework' means the use of 
     telecommunications to perform work functions at a rural work 
     center located outside the place of business of an employer.
       ``(b) Rural Telework Institute.--
       ``(1) In general.--The Secretary shall make 1 or more 
     grants to an eligible organization to pay the Federal share 
     of the cost of establishing and operating a national rural 
     telework institute to carry out projects described in 
     paragraph (2).
       ``(2) Projects.--The institute shall use grant funds 
     received under this subsection to carry out a 5-year 
     project--
       ``(A) to serve as a clearinghouse for telework research and 
     development;
       ``(B) to conduct outreach to rural communities and rural 
     workers;
       ``(C) to develop and share best practices in rural telework 
     throughout the United States;
       ``(D) to develop innovative, market-driven telework 
     projects and joint ventures with the private sector that 
     employ workers in rural areas in jobs that promote economic 
     self-sufficiency;
       ``(E) to share information about the design and 
     implementation of telework arrangements;
       ``(F) to support private sector businesses that are 
     transitioning to telework;
       ``(G) to support and assist telework projects and 
     individuals at the State and local level; and
       ``(H) to perform such other functions as the Secretary 
     considers appropriate.
       ``(3) Non-federal share.--
       ``(A) In general.--As a condition of receiving a grant 
     under this subsection, an eligible organization shall agree 
     to obtain, after the application of the eligible organization 
     has been approved and notice of award has been issued, 
     contributions from non-Federal sources that are equal to--
       ``(i) during each of the first, second, and third years of 
     a project, 30 percent of the amount of the grant; and
       ``(ii) during each of the fourth and fifth years of the 
     project, 50 percent of the amount of the grant.
       ``(B) Indian tribes.--Notwithstanding subparagraph (A), an 
     Indian tribe may use any Federal funds made available to the 
     Indian tribe for self-governance to pay the non-Federal 
     contributions required under subparagraph (A).
       ``(C) Form.--The non-Federal contributions required under 
     subparagraph (A) may be in the form of in-kind contributions, 
     including office equipment, office space, computer software, 
     consultant services, computer networking equipment, and 
     related services.
       ``(c) Telework Grants.--
       ``(1) In general.--Subject to paragraphs (2) through (5), 
     the Secretary shall make grants to eligible organizations to 
     pay the Federal share of the cost of--
       ``(A) obtaining equipment and facilities to establish or 
     expand telework locations in rural areas; and
       ``(B) operating telework locations in rural areas.
       ``(2) Applications.--To be eligible to receive a grant 
     under this subsection, an eligible organization shall submit 
     to the Secretary, and receive the approval of the Secretary 
     of, an application for the grant that demonstrates that the 
     eligible organization has adequate resources and capabilities 
     to establish or expand a telework location in a rural area.
       ``(3) Non-federal share.--
       ``(A) In general.--As a condition of receiving a grant 
     under this subsection, an eligible organization shall agree 
     to obtain, after the application of the eligible organization 
     has been approved and notice of award has been issued, 
     contributions from non-Federal sources that are equal to 50 
     percent of the amount of the grant.
       ``(B) Indian tribes.--Notwithstanding subparagraph (A), an 
     Indian tribe may use Federal funds made available to the 
     tribe for self-governance to pay the non-Federal 
     contributions required under subparagraph (A).
       ``(C) Sources.--The non-Federal contributions required 
     under subparagraph (A)--
       ``(i) may be in the form of in-kind contributions, 
     including office equipment, office space, computer software, 
     consultant services, computer networking equipment, and 
     related services; and
       ``(ii) may not be made from funds made available for 
     community development block grants under title I of the 
     Housing and Community Development Act of 1974 (42 U.S.C. 5301 
     et seq.).
       ``(4) Duration.--The Secretary may not provide a grant 
     under this subsection to expand or operate a telework 
     location in a rural area after the date that is 3 years after 
     the establishment of the telework location.
       ``(5) Amount.--The amount of a grant provided to an 
     eligible organization under this subsection shall be not less 
     than $1,000,000 and not more than $2,000,000.
       ``(d) Applicability of Certain Federal Law.--An eligible 
     organization that receives funds under this section shall be 
     subject to the provisions of Federal law (including 
     regulations) administered by the Secretary of Labor or the 
     Equal Employment Opportunity Commission that govern the 
     responsibilities of employers to employees.
       ``(e) Regulations.--Not later than 180 days after the date 
     of enactment of this section, the Secretary shall promulgate 
     regulations to carry out this section.
       ``(f) Authorization of Appropriation.--There is authorized 
     to be appropriated to carry out this section $30,000,000 for 
     each of fiscal years 2002 through 2007, of which $5,000,000 
     shall be provided to establish and support an institute under 
     subsection (b).''.

[[Page H1857]]

     SEC. 6023. HISTORIC BARN PRESERVATION.

       Subtitle D of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1981 et seq.) (as amended by section 6022) is 
     amended by adding at the end the following:

     ``SEC. 379A. HISTORIC BARN PRESERVATION.

       ``(a) Definitions.--In this section:
       ``(1) Barn.--The term `barn' means a building (other than a 
     dwelling) on a farm, ranch, or other agricultural operation 
     for--
       ``(A) housing animals;
       ``(B) storing or processing crops;
       ``(C) storing and maintaining agricultural equipment; or
       ``(D) serving an essential or useful purpose related to 
     agricultural activities conducted on the adjacent land.
       ``(2) Eligible applicant.--The term `eligible applicant' 
     means--
       ``(A) a State department of agriculture (or a designee);
       ``(B) a national or State nonprofit organization that--
       ``(i) is described in section 501(c)(3) of the Internal 
     Revenue Code of 1986 and exempt from taxation under section 
     501(a) of such Code; and
       ``(ii) has experience or expertise, as determined by the 
     Secretary, in the identification, evaluation, rehabilitation, 
     preservation, or protection of historic barns; and
       ``(C) a State historic preservation office.
       ``(3) Historic barn.--The term `historic barn' means a barn 
     that--
       ``(A) is at least 50 years old;
       ``(B) retains sufficient integrity of design, materials, 
     and construction to clearly identify the barn as an 
     agricultural building; and
       ``(C) meets the criteria for listing on National, State, or 
     local registers or inventories of historic structures.
       ``(4) Secretary.--The term `Secretary' means the Secretary, 
     acting through the Under Secretary of Rural Development.
       ``(b) Program.--The Secretary shall establish a historic 
     barn preservation program--
       ``(1) to assist States in developing a list of historic 
     barns;
       ``(2) to collect and disseminate information on historic 
     barns;
       ``(3) to foster educational programs relating to the 
     history, construction techniques, rehabilitation, and 
     contribution to society of historic barns; and
       ``(4) to sponsor and conduct research on--
       ``(A) the history of barns; and
       ``(B) best practices to protect and rehabilitate historic 
     barns from the effects of decay, fire, arson, and natural 
     disasters.
       ``(c) Grants.--
       ``(1) In general.--The Secretary may make grants to, or 
     enter into contracts or cooperative agreements with, eligible 
     applicants to carry out an eligible project under paragraph 
     (2).
       ``(2) Eligible projects.--A grant under this subsection may 
     be made to an eligible applicant for a project--
       ``(A) to rehabilitate or repair a historic barn;
       ``(B) to preserve a historic barn through--
       ``(i) the installation of a fire protection system, 
     including fireproofing or fire detection system and 
     sprinklers; and
       ``(ii) the installation of a system to prevent vandalism; 
     and
       ``(C) to identify, document, and conduct research on a 
     historic barn to develop and evaluate appropriate techniques 
     or best practices for protecting historic barns.
       ``(3) Requirements.--An eligible applicant that receives a 
     grant for a project under this subsection shall comply with 
     any standards established by the Secretary of the Interior 
     for historic preservation projects.
       ``(4) Authorization of appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this section for each of fiscal years 2002 through 
     2007.''.

     SEC. 6024. GRANTS FOR NOAA WEATHER RADIO TRANSMITTERS.

       Subtitle D of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1981 et seq.) (as amended by section 6023)) is 
     amended by adding at the end the following:

     ``SEC. 379B. GRANTS FOR NOAA WEATHER RADIO TRANSMITTERS.

       ``(a) In General.--The Secretary, acting through the 
     Administrator of the Rural Utilities Service, may make grants 
     to public and nonprofit entities, and borrowers of loans made 
     by the Rural Utilities Service, for the Federal share of the 
     cost of acquiring radio transmitters to increase coverage of 
     rural areas by the all hazards weather radio broadcast system 
     of the National Oceanic and Atmospheric Administration.
       ``(b) Eligibility.--To be eligible for a grant under this 
     section, an applicant shall provide to the Secretary--
       ``(1) a binding commitment from a tower owner to place the 
     transmitter on a tower; and
       ``(2) a description of how the tower placement will 
     increase coverage of a rural area by the all hazards weather 
     radio broadcast system of the National Oceanic and 
     Atmospheric Administration.
       ``(c) Federal Share.--A grant provided under this section 
     shall be not more than 75 percent of the total cost of 
     acquiring a radio transmitter, as described in subsection 
     (a).
       ``(d) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this section for each of fiscal years 2002 through 
     2007.''.

     SEC. 6025. GRANTS TO TRAIN FARM WORKERS IN NEW TECHNOLOGIES 
                   AND TO TRAIN FARM WORKERS IN SPECIALIZED SKILLS 
                   NECESSARY FOR HIGHER VALUE CROPS.

       Subtitle D of the Consolidated Farm and Rural Development 
     Act (7 U.S.C. 1981 et seq.) (as amended by section 6024) is 
     amended by adding at the end the following:

     ``SEC. 379C. GRANTS TO TRAIN FARM WORKERS IN NEW TECHNOLOGIES 
                   AND TO TRAIN FARM WORKERS IN SPECIALIZED SKILLS 
                   NECESSARY FOR HIGHER VALUE CROPS.

       ``(a) In General.--The Secretary shall make grants to 
     nonprofit organizations, or to a consortium of nonprofit 
     organizations, agribusinesses, State and local governments, 
     agricultural labor organizations, farmer or rancher 
     cooperatives, and community-based organizations with the 
     capacity to train farm workers.
       ``(b) Use of Funds.--An entity to which a grant is made 
     under this section shall use the grant to train farm workers 
     to use new technologies and develop specialized skills for 
     agricultural development.
       ``(c) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $10,000,000 for 
     each of fiscal years 2002 through 2007.''.

     SEC. 6026. RURAL COMMUNITY ADVANCEMENT PROGRAM.

       (a) National Reserve Program.--Section 381E of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 2009d) 
     is amended--
       (1) in subsection (b)--
       (A) by striking paragraph (4); and
       (B) by redesignating paragraph (5) as paragraph (4);
       (2) by striking subsection (e);
       (3) by redesignating subsections (f) through (h) as 
     subsections (e) through (g), respectively; and
       (4) in subsection (g) (as so redesignated), by striking 
     ``subsection (g) of this section'' and inserting ``subsection 
     (f)''.
       (b) Rural Venture Capital Demonstration Program.--Section 
     381O of the Consolidated Farm and Rural Development Act (7 
     U.S.C. 2009n) is repealed.
       (c) Conforming Amendments.--Section 381G of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 
     2009f(a)) is amended--
       (1) in subsection (a), by striking ``section 381E(g)'' each 
     place it appears and inserting ``section 381E(f)''; and
       (2) in subsection (b)(1), by striking ``section 381E(h)'' 
     and inserting ``section 381E(g)''.

     SEC. 6027. DELTA REGIONAL AUTHORITY.

       (a) Voting.--Section 382B(c) of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 2009aa-1(c)) is amended by 
     striking paragraph (1) and inserting the following:
       ``(1) In general.--
       ``(A) Temporary method.--During the period beginning on the 
     date of enactment of this subparagraph and ending on December 
     31, 2004, a decision by the Authority shall require the 
     affirmative vote of the Federal cochairperson and a majority 
     of the State members (not including any member representing a 
     State that is delinquent under subsection (g)(2)(C)) to be 
     effective.
       ``(B) Permanent method.--Effective beginning on January 1, 
     2005, a decision by the Authority shall require a majority 
     vote of the Authority (not including any member representing 
     a State that is delinquent under subsection (g)(2)(C)) to be 
     effective.''.
       (b) Authority to Issue Regulations.--Section 382B(e)(4) of 
     the Consolidated Farm and Rural Development Act (7 U.S.C. 
     2009aa-1(e)(4)) is amended by striking ``and rules'' and 
     inserting ``, rules, and regulations''.
       (c) Economic and Community Development Grants.--Section 
     382C(b) of the Consolidated Farm and Rural Development Act (7 
     U.S.C. 2009aa-2(b)) is amended by striking paragraph (3).
       (d) Supplements to Federal Grant Programs.--Section 382D of 
     the Consolidated Farm and Rural Development Act (7 U.S.C. 
     2009aa-3) is amended to read as follows:

     ``SEC. 382D. SUPPLEMENTS TO FEDERAL GRANT PROGRAMS.

       ``(a) Finding.--Congress finds that certain States and 
     local communities of the region, including local development 
     districts, may be unable to take maximum advantage of Federal 
     grant programs for which the States and communities are 
     eligible because--
       ``(1) the States or communities lack the economic resources 
     to provide the required matching share; or
       ``(2) there are insufficient funds available under the 
     applicable Federal law authorizing the Federal grant program 
     to meet pressing needs of the region.
       ``(b) Federal Grant Program Funding.--Notwithstanding any 
     provision of law limiting the Federal share, the areas 
     eligible for assistance, or the authorizations of 
     appropriations of any Federal grant program, and in 
     accordance with subsection (c), the Authority, with the 
     approval of the Federal cochairperson and with respect to a 
     project to be carried out in the region--
       ``(1) may increase the Federal share of the costs of a 
     project under the Federal grant program to not more than 90 
     percent (except as provided in section 382F(b)); and
       ``(2) shall use amounts made available to carry out this 
     subtitle to pay the increased Federal share.
       ``(c) Certifications.--
       ``(1) In general.--In the case of any project for which all 
     or any portion of the basic Federal share of the costs of the 
     project is proposed to be paid under this section, no Federal 
     contribution shall be made until the Federal official 
     administering the Federal law that authorizes the Federal 
     grant program certifies that the project--
       ``(A) meets (except as provided in subsection (b)) the 
     applicable requirements of the applicable Federal grant 
     program; and
       ``(B) could be approved for Federal contribution under the 
     Federal grant program if funds were available under the law 
     for the project.
       ``(2) Certification by authority.--
       ``(A) In general.--The certifications and determinations 
     required to be made by the Authority for approval of projects 
     under this Act in accordance with section 382I--
       ``(i) shall be controlling; and
       ``(ii) shall be accepted by the Federal agencies.

[[Page H1858]]

       ``(B) Acceptance by federal cochairperson.--In the case of 
     any project described in paragraph (1), any finding, report, 
     certification, or documentation required to be submitted with 
     respect to the project to the head of the department, agency, 
     or instrumentality of the Federal Government responsible for 
     the administration of the Federal grant program under which 
     the project is carried out shall be accepted by the Federal 
     cochairperson.''.
       (e) Grants to Local Development Agencies.--Section 
     382E(b)(1) of the Consolidated Farm and Rural Development Act 
     (7 U.S.C. 2009aa-4(b)(1)) is amended by striking ``may'' and 
     inserting ``shall''.
       (f) Approval of Development Plans and Projects.--Section 
     382I of the Consolidated Farm and Rural Development Act (7 
     U.S.C. 2009aa-8) is amended--
       (1) in subsection (a), by inserting ``and approved'' after 
     ``reviewed''; and
       (2) in subsection (d), by striking ``Votes for Decisions.--
     '' and inserting ``Approval of Grant Applications.--''.
       (g) Authorization of Appropriations.--Section 382M(a) of 
     the Consolidated Farm and Rural Development Act (7 U.S.C. 
     2009aa-12(a)) is amended by striking ``2002'' and inserting 
     ``2007''.
       (h) Termination of Authority.--Section 382N of the 
     Consolidated Farm and Rural Development Act (7 U.S.C. 2009aa-
     13) is amended by striking ``2002'' and inserting ``2007''.
       (i) Delta Region Agricultural Economic Development.--
     Subtitle D of the Consolidated Farm and Rural Development Act 
     (7 U.S.C. 1981 et seq.) (as amended by section 6025) is 
     amended by adding at the end the following:

     ``SEC. 379D. DELTA REGION AGRICULTURAL ECONOMIC DEVELOPMENT.

       ``(a) In General.--The Secretary may make grants to assist 
     in the development of state-of-the-art technology in animal 
     nutrition (including research and development of the 
     technology) and value-added manufacturing to promote an 
     economic platform for the Delta region (as defined in section 
     382A) to relieve severe economic conditions.
       ``(b) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section 
     $7,000,000 for each of fiscal years 2002 through 2007.''.
       (j) Definition of Lower Mississippi.--Section 4(2)(I) of 
     the Delta Development Act (42 U.S.C. 3121 note; Public Law 
     100-460) is amended by inserting ``Butler, Conecuh, Escambia, 
     Monroe,'' after ``Russell,''.

     SEC. 6028. NORTHERN GREAT PLAINS REGIONAL AUTHORITY.

       The Consolidated Farm and Rural Development Act (7 U.S.C. 
     1921 et seq.) is amended by adding at the end the following:
         ``Subtitle G--Northern Great Plains Regional Authority

     ``SEC. 383A. DEFINITIONS.

       ``In this subtitle:
       ``(1) Authority.--The term `Authority' means the Northern 
     Great Plains Regional Authority established by section 383B.
       ``(2) Federal grant program.--The term `Federal grant 
     program' means a Federal grant program to provide assistance 
     in--
       ``(A) implementing the recommendations of the Northern 
     Great Plains Rural Development Commission established by the 
     Northern Great Plains Rural Development Act (7 U.S.C. 2661 
     note; Public Law 103-318);
       ``(B) acquiring or developing land;
       ``(C) constructing or equipping a highway, road, bridge, or 
     facility;
       ``(D) carrying out other economic development activities; 
     or
       ``(E) conducting research activities related to the 
     activities described in subparagraphs (A) through (D).
       ``(3) Indian tribe.--The term `Indian tribe' has the 
     meaning given the term in section 4 of the Indian Self-
     Determination and Education Assistance Act (25 U.S.C. 450b).
       ``(4) Region.--The term `region' means the States of Iowa, 
     Minnesota, Nebraska, North Dakota, and South Dakota.

     ``SEC. 383B. NORTHERN GREAT PLAINS REGIONAL AUTHORITY.

       ``(a) Establishment.--
       ``(1) In general.--There is established the Northern Great 
     Plains Regional Authority.
       ``(2) Composition.--The Authority shall be composed of--
       ``(A) a Federal member, to be appointed by the President, 
     by and with the advice and consent of the Senate;
       ``(B) the Governor (or a designee of the Governor) of each 
     State in the region that elects to participate in the 
     Authority; and
       ``(C) a member of an Indian tribe, who shall be a 
     chairperson of an Indian tribe in the region or a designee of 
     such a chairperson, to be appointed by the President, by and 
     with the advice and consent of the Senate.
       ``(3) Cochairpersons.--The Authority shall be headed by--
       ``(A) the Federal member, who shall serve--
       ``(i) as the Federal cochairperson; and
       ``(ii) as a liaison between the Federal Government and the 
     Authority;
       ``(B) a State cochairperson, who--
       ``(i) shall be a Governor of a participating State in the 
     region; and
       ``(ii) shall be elected by the State members for a term of 
     not less than 1 year; and
       ``(C) the member of an Indian tribe, who shall serve--
       ``(i) as the tribal cochairperson; and
       ``(ii) as a liaison between the governments of Indian 
     tribes in the region and the Authority.
       ``(b) Alternate Members.--
       ``(1) Alternate federal cochairperson.--The President shall 
     appoint an alternate Federal cochairperson.
       ``(2) State alternates.--
       ``(A) In general.--The State member of a participating 
     State may have a single alternate, who shall be--
       ``(i) a resident of that State; and
       ``(ii) appointed by the Governor of the State.
       ``(B) Quorum.--A State alternate member shall not be 
     counted toward the establishment of a quorum of the members 
     of the Authority in any case in which a quorum of the State 
     members is required to be present.
       ``(3) Alternate tribal cochairperson.--The President shall 
     appoint an alternate tribal cochairperson, by and with the 
     advice and consent of the Senate.
       ``(4) Delegation of power.--No power or responsibility of 
     the Authority specified in paragraphs (2) and (3) of 
     subsection (c), and no voting right of any member of the 
     Authority, shall be delegated to any person who is not--
       ``(A) a member of the Authority; or
       ``(B) entitled to vote in Authority meetings.
       ``(c) Voting.--
       ``(1) In general.--A decision by the Authority shall 
     require a majority vote of the Authority (not including any 
     member representing a State that is delinquent under 
     subsection (g)(2)(D)) to be effective.
       ``(2) Quorum.--A quorum of State members shall be required 
     to be present for the Authority to make any policy decision, 
     including--
       ``(A) a modification or revision of an Authority policy 
     decision;
       ``(B) approval of a State or regional development plan; and
       ``(C) any allocation of funds among the States.
       ``(3) Project and grant proposals.--The approval of project 
     and grant proposals shall be--
       ``(A) a responsibility of the Authority; and
       ``(B) conducted in accordance with section 383I.
       ``(4) Voting by alternate members.--An alternate member 
     shall vote in the case of the absence, death, disability, 
     removal, or resignation of the Federal, State, or Indian 
     tribe member for whom the alternate member is an alternate.
       ``(d) Duties.--The Authority shall--
       ``(1) develop, on a continuing basis, comprehensive and 
     coordinated plans and programs to establish priorities and 
     approve grants for the economic development of the region, 
     giving due consideration to other Federal, State, tribal, and 
     local planning and development activities in the region;
       ``(2) not later than 220 days after the date of enactment 
     of this subtitle, establish priorities in a development plan 
     for the region (including 5-year regional outcome targets);
       ``(3) assess the needs and assets of the region based on 
     available research, demonstrations, investigations, 
     assessments, and evaluations of the region prepared by 
     Federal, State, tribal, and local agencies, universities, 
     local development districts, and other nonprofit groups;
       ``(4) formulate and recommend to the Governors and 
     legislatures of States that participate in the Authority 
     forms of interstate cooperation;
       ``(5) work with State, tribal, and local agencies in 
     developing appropriate model legislation;
       ``(6)(A) enhance the capacity of, and provide support for, 
     local development districts in the region; or
       ``(B) if no local development district exists in an area in 
     a participating State in the region, foster the creation of a 
     local development district;
       ``(7) encourage private investment in industrial, 
     commercial, and other economic development projects in the 
     region; and
       ``(8) cooperate with and assist State governments with 
     economic development programs of participating States.
       ``(e) Administration.--In carrying out subsection (d), the 
     Authority may--
       ``(1) hold such hearings, sit and act at such times and 
     places, take such testimony, receive such evidence, and print 
     or otherwise reproduce and distribute a description of the 
     proceedings and reports on actions by the Authority as the 
     Authority considers appropriate;
       ``(2) authorize, through the Federal, State, or tribal 
     cochairperson or any other member of the Authority designated 
     by the Authority, the administration of oaths if the 
     Authority determines that testimony should be taken or 
     evidence received under oath;
       ``(3) request from any Federal, State, tribal, or local 
     agency such information as may be available to or procurable 
     by the agency that may be of use to the Authority in carrying 
     out the duties of the Authority;
       ``(4) adopt, amend, and repeal bylaws and rules governing 
     the conduct of business and the performance of duties of the 
     Authority;
       ``(5) request the head of any Federal agency to detail to 
     the Authority such personnel as the Authority requires to 
     carry out duties of the Authority, each such detail to be 
     without loss of seniority, pay, or other employee status;
       ``(6) request the head of any State agency, tribal 
     government, or local government to detail to the Authority 
     such personnel as the Authority requires to carry out duties 
     of the Authority, each such detail to be without loss of 
     seniority, pay, or other employee status;
       ``(7) provide for coverage of Authority employees in a 
     suitable retirement and employee benefit system by--
       ``(A) making arrangements or entering into contracts with 
     any participating State government or tribal government; or
       ``(B) otherwise providing retirement and other employee 
     benefit coverage;
       ``(8) accept, use, and dispose of gifts or donations of 
     services or real, personal, tangible, or intangible property;
       ``(9) enter into and perform such contracts, leases, 
     cooperative agreements, or other transactions as are 
     necessary to carry out Authority duties, including any 
     contracts, leases, or cooperative agreements with--
       ``(A) any department, agency, or instrumentality of the 
     United States;

[[Page H1859]]

       ``(B) any State (including a political subdivision, agency, 
     or instrumentality of the State);
       ``(C) any Indian tribe in the region; or
       ``(D) any person, firm, association, or corporation; and
       ``(10) establish and maintain a central office and field 
     offices at such locations as the Authority may select.
       ``(f) Federal Agency Cooperation.--A Federal agency shall--
       ``(1) cooperate with the Authority; and
       ``(2) provide, on request of the Federal cochairperson, 
     appropriate assistance in carrying out this subtitle, in 
     accordance with applicable Federal laws (including 
     regulations).
       ``(g) Administrative Expenses.--
       ``(1) Federal share.--The Federal share of the 
     administrative expenses of the Authority shall be--
       ``(A) for fiscal year 2002, 100 percent;
       ``(B) for fiscal year 2003, 75 percent; and
       ``(C) for fiscal year 2004 and each fiscal year thereafter, 
     50 percent.
       ``(2) Non-federal share.--
       ``(A) In general.--The non-Federal share of the 
     administrative expenses of the Authority shall be paid by 
     non-Federal sources in the States that participate in the 
     Authority.
       ``(B) Share paid by each state.--The share of 
     administrative expenses of the Authority to be paid by non-
     Federal sources in each State shall be determined by the 
     Authority.
       ``(C) No federal participation.--The Federal cochairperson 
     shall not participate or vote in any decision under 
     subparagraph (B).
       ``(D) Delinquent states.--If a State is delinquent in 
     payment of the State's share of administrative expenses of 
     the Authority under this subsection--
       ``(i) no assistance under this subtitle shall be provided 
     to the State (including assistance to a political subdivision 
     or a resident of the State); and
       ``(ii) no member of the Authority from the State shall 
     participate or vote in any action by the Authority.
       ``(h) Compensation.--
       ``(1) Federal and tribal cochairpersons.--The Federal 
     cochairperson and the tribal cochairperson shall be 
     compensated by the Federal Government at the annual rate of 
     basic pay prescribed for level III of the Executive Schedule 
     in subchapter II of chapter 53 of title 5, United States 
     Code.
       ``(2) Alternate federal and tribal cochairpersons.--The 
     alternate Federal cochairperson and the alternate tribal 
     cochairperson--
       ``(A) shall be compensated by the Federal Government at the 
     annual rate of basic pay prescribed for level V of the 
     Executive Schedule described in paragraph (1); and
       ``(B) when not actively serving as an alternate, shall 
     perform such functions and duties as are delegated by the 
     Federal cochairperson or the tribal cochairperson, 
     respectively.
       ``(3) State members and alternates.--
       ``(A) In general.--A State shall compensate each member and 
     alternate representing the State on the Authority at the rate 
     established by State law.
       ``(B) No additional compensation.--No State member or 
     alternate member shall receive any salary, or any 
     contribution to or supplementation of salary from any source 
     other than the State for services provided by the member or 
     alternate member to the Authority.
       ``(4) Detailed employees.--
       ``(A) In general.--No person detailed to serve the 
     Authority under subsection (e)(6) shall receive any salary or 
     any contribution to or supplementation of salary for services 
     provided to the Authority from--
       ``(i) any source other than the State, tribal, local, or 
     intergovernmental agency from which the person was detailed; 
     or
       ``(ii) the Authority.
       ``(B) Violation.--Any person that violates this paragraph 
     shall be fined not more than $5,000, imprisoned not more than 
     1 year, or both.
       ``(C) Applicable law.--The Federal cochairperson, the 
     alternate Federal cochairperson, and any Federal officer or 
     employee detailed to duty on the Authority under subsection 
     (e)(5) shall not be subject to subparagraph (A), but shall 
     remain subject to sections 202 through 209 of title 18, 
     United States Code.
       ``(5) Additional personnel.--
       ``(A) Compensation.--
       ``(i) In general.--The Authority may appoint and fix the 
     compensation of an executive director and such other 
     personnel as are necessary to enable the Authority to carry 
     out the duties of the Authority.
       ``(ii) Exception.--Compensation under clause (i) shall not 
     exceed the maximum rate for the Senior Executive Service 
     under section 5382 of title 5, United States Code, including 
     any applicable locality-based comparability payment that may 
     be authorized under section 5304(h)(2)(C) of that title.
       ``(B) Executive director.--The executive director shall be 
     responsible for--
       ``(i) the carrying out of the administrative duties of the 
     Authority;
       ``(ii) direction of the Authority staff; and
       ``(iii) such other duties as the Authority may assign.
       ``(C) No federal employee status.--No member, alternate, 
     officer, or employee of the Authority (except the Federal 
     cochairperson of the Authority, the alternate and staff for 
     the Federal cochairperson, and any Federal employee detailed 
     to the Authority under subsection (e)(5)) shall be considered 
     to be a Federal employee for any purpose.
       ``(i) Conflicts of Interest.--
       ``(1) In general.--Except as provided under paragraph (2), 
     no State member, Indian tribe member, State alternate, 
     officer, or employee of the Authority shall participate 
     personally and substantially as a member, alternate, officer, 
     or employee of the Authority, through decision, approval, 
     disapproval, recommendation, the rendering of advice, 
     investigation, or otherwise, in any proceeding, application, 
     request for a ruling or other determination, contract, claim, 
     controversy, or other matter in which, to knowledge of the 
     member, alternate, officer, or employee--
       ``(A) the member, alternate, officer, or employee;
       ``(B) the spouse, minor child, partner, or organization 
     (other than a State or political subdivision of the State or 
     the Indian tribe) of the member, alternate, officer, or 
     employee, in which the member, alternate, officer, or 
     employee is serving as officer, director, trustee, partner, 
     or employee; or
       ``(C) any person or organization with whom the member, 
     alternate, officer, or employee is negotiating or has any 
     arrangement concerning prospective employment;
     has a financial interest.
       ``(2) Disclosure.--Paragraph (1) shall not apply if the 
     State member, Indian tribe member, alternate, officer, or 
     employee--
       ``(A) immediately advises the Authority of the nature and 
     circumstances of the proceeding, application, request for a 
     ruling or other determination, contract, claim, controversy, 
     or other particular matter presenting a potential conflict of 
     interest;
       ``(B) makes full disclosure of the financial interest; and
       ``(C) before the proceeding concerning the matter 
     presenting the conflict of interest, receives a written 
     determination by the Authority that the interest is not so 
     substantial as to be likely to affect the integrity of the 
     services that the Authority may expect from the State member, 
     Indian tribe member, alternate, officer, or employee.
       ``(3) Violation.--Any person that violates this subsection 
     shall be fined not more than $10,000, imprisoned not more 
     than 2 years, or both.
       ``(j) Validity of Contracts, Loans, and Grants.--The 
     Authority may declare void any contract, loan, or grant of or 
     by the Authority in relation to which the Authority 
     determines that there has been a violation of any provision 
     under subsection (h)(4) or subsection (i) of this subtitle, 
     or sections 202 through 209 of title 18, United States Code.

     ``SEC. 383C. ECONOMIC AND COMMUNITY DEVELOPMENT GRANTS.

       ``(a) In General.--The Authority may approve grants to 
     States, Indian tribes, local governments, and public and 
     nonprofit organizations for projects, approved in accordance 
     with section 383I--
       ``(1) to develop the transportation and telecommunication 
     infrastructure of the region for the purpose of facilitating 
     economic development in the region (except that grants for 
     this purpose may be made only to States, Indian tribes, local 
     governments, and nonprofit organizations);
       ``(2) to assist the region in obtaining the job training, 
     employment-related education, and business development (with 
     an emphasis on entrepreneurship) that are needed to build and 
     maintain strong local economies;
       ``(3) to provide assistance to severely distressed and 
     underdeveloped areas that lack financial resources for 
     improving basic public services;
       ``(4) to provide assistance to severely distressed and 
     underdeveloped areas that lack financial resources for 
     equipping industrial parks and related facilities; and
       ``(5) to otherwise achieve the purposes of this subtitle.
       ``(b) Funding.--
       ``(1) In general.--Funds for grants under subsection (a) 
     may be provided--
       ``(A) entirely from appropriations to carry out this 
     section;
       ``(B) in combination with funds available under another 
     Federal grant program; or
       ``(C) from any other source.
       ``(2) Priority of funding.--To best build the foundations 
     for long-term economic development and to complement other 
     Federal, State, and tribal resources in the region, Federal 
     funds available under this subtitle shall be focused on the 
     activities in the following order or priority:
       ``(A) Basic public infrastructure in distressed counties 
     and isolated areas of distress.
       ``(B) Transportation and telecommunication infrastructure 
     for the purpose of facilitating economic development in the 
     region.
       ``(C) Business development, with emphasis on 
     entrepreneurship.
       ``(D) Job training or employment-related education, with 
     emphasis on use of existing public educational institutions 
     located in the region.

     ``SEC. 383D. SUPPLEMENTS TO FEDERAL GRANT PROGRAMS.

       ``(a) Finding.--Congress finds that certain States and 
     local communities of the region, including local development 
     districts, may be unable to take maximum advantage of Federal 
     grant programs for which the States and communities are 
     eligible because--
       ``(1) they lack the economic resources to provide the 
     required matching share; or
       ``(2) there are insufficient funds available under the 
     applicable Federal law authorizing the Federal grant program 
     to meet pressing needs of the region.
       ``(b) Federal Grant Program Funding.--Notwithstanding any 
     provision of law limiting the Federal share, the areas 
     eligible for assistance, or the authorizations of 
     appropriations, under any Federal grant program, and in 
     accordance with subsection (c), the Authority, with the 
     approval of the Federal cochairperson and with respect to a 
     project to be carried out in the region--
       ``(1) may increase the Federal share of the costs of a 
     project under any Federal grant program to not more than 90 
     percent (except as provided in section 383F(b)); and
       ``(2) shall use amounts made available to carry out this 
     subtitle to pay the increased Federal share.

[[Page H1860]]

       ``(c) Certifications.--
       ``(1) In general.--In the case of any project for which all 
     or any portion of the basic Federal share of the costs of the 
     project is proposed to be paid under this section, no Federal 
     contribution shall be made until the Federal official 
     administering the Federal law that authorizes the Federal 
     grant program certifies that the project--
       ``(A) meets (except as provided in subsection (b)) the 
     applicable requirements of the applicable Federal grant 
     program; and
       ``(B) could be approved for Federal contribution under the 
     Federal grant program if funds were available under the law 
     for the project.
       ``(2) Certification by authority.--
       ``(A) In general.--The certifications and determinations 
     required to be made by the Authority for approval of projects 
     under this Act in accordance with section 383I--
       ``(i) shall be controlling; and
       ``(ii) shall be accepted by the Federal agencies.
       ``(B) Acceptance by federal cochairperson.--In the case of 
     any project described in paragraph (1), any finding, report, 
     certification, or documentation required to be submitted with 
     respect to the project to the head of the department, agency, 
     or instrumentality of the Federal Government responsible for 
     the administration of the Federal grant program under which 
     the project is carried out shall be accepted by the Federal 
     cochairperson.

     ``SEC. 383E. LOCAL DEVELOPMENT DISTRICTS AND ORGANIZATIONS 
                   AND NORTHERN GREAT PLAINS INC.

       ``(a) Definition of Local Development District.--In this 
     section, the term `local development district' means an 
     entity--
       ``(1) that--
       ``(A) is a planning district in existence on the date of 
     enactment of this subtitle that is recognized by the Economic 
     Development Administration of the Department of Commerce; or
       ``(B) is--
       ``(i) organized and operated in a manner that ensures 
     broad-based community participation and an effective 
     opportunity for other nonprofit groups to contribute to the 
     development and implementation of programs in the region;
       ``(ii) governed by a policy board with at least a simple 
     majority of members consisting of--

       ``(I) elected officials or employees of a general purpose 
     unit of local government who have been appointed to represent 
     the government; or
       ``(II) individuals appointed by the general purpose unit of 
     local government to represent the government;

       ``(iii) certified to the Authority as having a charter or 
     authority that includes the economic development of counties 
     or parts of counties or other political subdivisions within 
     the region--

       ``(I) by the Governor of each State in which the entity is 
     located; or
       ``(II) by the State officer designated by the appropriate 
     State law to make the certification; and

       ``(iv)(I) a nonprofit incorporated body organized or 
     chartered under the law of the State in which the entity is 
     located;
       ``(II) a nonprofit agency or instrumentality of a State or 
     local government;
       ``(III) a public organization established before the date 
     of enactment of this subtitle under State law for creation of 
     multi-jurisdictional, area-wide planning organizations; or
       ``(IV) a nonprofit association or combination of bodies, 
     agencies, and instrumentalities described in subclauses (I) 
     through (III); and
       ``(2) that has not, as certified by the Federal 
     cochairperson--
       ``(A) inappropriately used Federal grant funds from any 
     Federal source; or
       ``(B) appointed an officer who, during the period in which 
     another entity inappropriately used Federal grant funds from 
     any Federal source, was an officer of the other entity.
       ``(b) Grants to Local Development Districts.--
       ``(1) In general.--The Authority may make grants for 
     administrative expenses under this section.
       ``(2) Conditions for grants.--
       ``(A) Maximum amount.--The amount of any grant awarded 
     under paragraph (1) shall not exceed 80 percent of the 
     administrative expenses of the local development district 
     receiving the grant.
       ``(B) Maximum period.--No grant described in paragraph (1) 
     shall be awarded to a State agency certified as a local 
     development district for a period greater than 3 years.
       ``(C) Local share.--The contributions of a local 
     development district for administrative expenses may be in 
     cash or in kind, fairly evaluated, including space, 
     equipment, and services.
       ``(c) Duties of Local Development Districts.--A local 
     development district shall--
       ``(1) operate as a lead organization serving multicounty 
     areas in the region at the local level; and
       ``(2) serve as a liaison between State, tribal, and local 
     governments, nonprofit organizations (including community-
     based groups and educational institutions), the business 
     community, and citizens that--
       ``(A) are involved in multijurisdictional planning;
       ``(B) provide technical assistance to local jurisdictions 
     and potential grantees; and
       ``(C) provide leadership and civic development assistance.
       ``(d) Northern Great Plains Inc.--Northern Great Plains 
     Inc., a nonprofit corporation incorporated in the State of 
     Minnesota to implement the recommendations of the Northern 
     Great Plains Rural Development Commission established by the 
     Northern Great Plains Rural Development Act (7 U.S.C. 2661 
     note; Public Law 103-318)--
       ``(1) shall serve as an independent, primary resource for 
     the Authority on issues of concern to the region;
       ``(2) shall advise the Authority on development of 
     international trade;
       ``(3) may provide research, education, training, and other 
     support to the Authority; and
       ``(4) may carry out other activities on its own behalf or 
     on behalf of other entities.

     ``SEC. 383F. DISTRESSED COUNTIES AND AREAS AND NONDISTRESSED 
                   COUNTIES.

       ``(a) Designations.--Not later than 90 days after the date 
     of enactment of this subtitle, and annually thereafter, the 
     Authority, in accordance with such criteria as the Authority 
     may establish, shall designate--
       ``(1) as distressed counties, counties in the region that 
     are the most severely and persistently distressed and 
     underdeveloped and have high rates of poverty, unemployment, 
     or outmigration;
       ``(2) as nondistressed counties, counties in the region 
     that are not designated as distressed counties under 
     paragraph (1); and
       ``(3) as isolated areas of distress, areas located in 
     nondistressed counties (as designated under paragraph (2)) 
     that have high rates of poverty, unemployment, or 
     outmigration.
       ``(b) Distressed Counties.--
       ``(1) In general.--The Authority shall allocate at least 75 
     percent of the appropriations made available under section 
     383M for programs and projects designed to serve the needs of 
     distressed counties and isolated areas of distress in the 
     region.
       ``(2) Funding limitations.--The funding limitations under 
     section 383D(b) shall not apply to a project to provide 
     transportation or telecommunication or basic public services 
     to residents of 1 or more distressed counties or isolated 
     areas of distress in the region.
       ``(c) Nondistressed Counties.--
       ``(1) In general.--Except as provided in paragraph (2), no 
     funds shall be provided under this subtitle for a project 
     located in a county designated as a nondistressed county 
     under subsection (a)(2).
       ``(2) Exceptions.--
       ``(A) In general.--The funding prohibition under paragraph 
     (1) shall not apply to grants to fund the administrative 
     expenses of local development districts under section 
     383E(b).
       ``(B) Multicounty projects.--The Authority may waive the 
     application of the funding prohibition under paragraph (1) 
     to--
       ``(i) a multicounty project that includes participation by 
     a nondistressed county; or
       ``(ii) any other type of project;
     if the Authority determines that the project could bring 
     significant benefits to areas of the region outside a 
     nondistressed county.
       ``(C) Isolated areas of distress.--For a designation of an 
     isolated area of distress for assistance to be effective, the 
     designation shall be supported--
       ``(i) by the most recent Federal data available; or
       ``(ii) if no recent Federal data are available, by the most 
     recent data available through the government of the State in 
     which the isolated area of distress is located.
       ``(d) Transportation, Telecommunication, and Basic Public 
     Infrastructure.--The Authority shall allocate at least 50 
     percent of any funds made available under section 383M for 
     transportation, telecommunication, and basic public 
     infrastructure projects authorized under paragraphs (1) and 
     (3) of section 383C(a).

     ``SEC. 383G. DEVELOPMENT PLANNING PROCESS.

       ``(a) State Development Plan.--In accordance with policies 
     established by the Authority, each State member shall submit 
     a development plan for the area of the region represented by 
     the State member.
       ``(b) Content of Plan.--A State development plan submitted 
     under subsection (a) shall reflect the goals, objectives, and 
     priorities identified in the regional development plan 
     developed under section 383B(d)(2).
       ``(c) Consultation With Interested Local Parties.--In 
     carrying out the development planning process (including the 
     selection of programs and projects for assistance), a State 
     may--
       ``(1) consult with--
       ``(A) local development districts; and
       ``(B) local units of government; and
       ``(2) take into consideration the goals, objectives, 
     priorities, and recommendations of the entities described in 
     paragraph (1).
       ``(d) Public Participation.--
       ``(1) In general.--The Authority and applicable State and 
     local development districts shall encourage and assist, to 
     the maximum extent practicable, public participation in the 
     development, revision, and implementation of all plans and 
     programs under this subtitle.
       ``(2) Regulations.--The Authority shall develop guidelines 
     for providing public participation described in paragraph 
     (1), including public hearings.

     ``SEC. 383H. PROGRAM DEVELOPMENT CRITERIA.

       ``(a) In General.--In considering programs and projects to 
     be provided assistance under this subtitle, and in 
     establishing a priority ranking of the requests for 
     assistance provided to the Authority, the Authority shall 
     follow procedures that ensure, to the maximum extent 
     practicable, consideration of--
       ``(1) the relationship of the project or class of projects 
     to overall regional development;
       ``(2) the per capita income and poverty and unemployment 
     and outmigration rates in an area;
       ``(3) the financial resources available to the applicants 
     for assistance seeking to carry out the project, with 
     emphasis on ensuring that projects are adequately financed to 
     maximize the probability of successful economic development;
       ``(4) the importance of the project or class of projects in 
     relation to other projects or classes of projects that may be 
     in competition for the same funds;

[[Page H1861]]

       ``(5) the prospects that the project for which assistance 
     is sought will improve, on a continuing rather than a 
     temporary basis, the opportunities for employment, the 
     average level of income, or the economic development of the 
     area to be served by the project; and
       ``(6) the extent to which the project design provides for 
     detailed outcome measurements by which grant expenditures and 
     the results of the expenditures may be evaluated.
       ``(b) No Relocation Assistance.--No financial assistance 
     authorized by this subtitle shall be used to assist a person 
     or entity in relocating from one area to another, except that 
     financial assistance may be used as otherwise authorized by 
     this title to attract businesses from outside the region to 
     the region.
       ``(c) Maintenance of Effort.--Funds may be provided for a 
     program or project in a State under this subtitle only if the 
     Authority determines that the level of Federal or State 
     financial assistance provided under a law other than this 
     subtitle, for the same type of program or project in the same 
     area of the State within the region, will not be reduced as a 
     result of funds made available by this subtitle.

     ``SEC. 383I. APPROVAL OF DEVELOPMENT PLANS AND PROJECTS.

       ``(a) In General.--A State or regional development plan or 
     any multistate subregional plan that is proposed for 
     development under this subtitle shall be reviewed by the 
     Authority.
       ``(b) Evaluation by State Member.--An application for a 
     grant or any other assistance for a project under this 
     subtitle shall be made through and evaluated for approval by 
     the State member of the Authority representing the applicant.
       ``(c) Certification.--An application for a grant or other 
     assistance for a project shall be approved only on 
     certification by the State member that the application for 
     the project--
       ``(1) describes ways in which the project complies with any 
     applicable State development plan;
       ``(2) meets applicable criteria under section 383H;
       ``(3) provides adequate assurance that the proposed project 
     will be properly administered, operated, and maintained; and
       ``(4) otherwise meets the requirements of this subtitle.
       ``(d) Votes for Decisions.--On certification by a State 
     member of the Authority of an application for a grant or 
     other assistance for a specific project under this section, 
     an affirmative vote of the Authority under section 383B(c) 
     shall be required for approval of the application.

     ``SEC. 383J. CONSENT OF STATES.

       ``Nothing in this subtitle requires any State to engage in 
     or accept any program under this subtitle without the consent 
     of the State.

     ``SEC. 383K. RECORDS.

       ``(a) Records of the Authority.--
       ``(1) In general.--The Authority shall maintain accurate 
     and complete records of all transactions and activities of 
     the Authority.
       ``(2) Availability.--All records of the Authority shall be 
     available for audit and examination by the Comptroller 
     General of the United States and the Inspector General of the 
     Department of Agriculture (including authorized 
     representatives of the Comptroller General and the Inspector 
     General of the Department of Agriculture).
       ``(b) Records of Recipients of Federal Assistance.--
       ``(1) In general.--A recipient of Federal funds under this 
     subtitle shall, as required by the Authority, maintain 
     accurate and complete records of transactions and activities 
     financed with Federal funds and report to the Authority on 
     the transactions and activities to the Authority.
       ``(2) Availability.--All records required under paragraph 
     (1) shall be available for audit by the Comptroller General 
     of the United States, the Inspector General of the Department 
     of Agriculture, and the Authority (including authorized 
     representatives of the Comptroller General, the Inspector 
     General of the Department of Agriculture, and the Authority).
       ``(c) Annual Audit.--The Inspector General of the 
     Department of Agriculture shall audit the activities, 
     transactions, and records of the Authority on an annual 
     basis.

     ``SEC. 383L. ANNUAL REPORT.

       ``Not later than 180 days after the end of each fiscal 
     year, the Authority shall submit to the President and to 
     Congress a report describing the activities carried out under 
     this subtitle.

     ``SEC. 383M. AUTHORIZATION OF APPROPRIATIONS.

       ``(a) In General.--There is authorized to be appropriated 
     to the Authority to carry out this subtitle $30,000,000 for 
     each of fiscal years 2002 through 2007, to remain available 
     until expended.
       ``(b) Administrative Expenses.--Not more than 5 percent of 
     the amount appropriated under subsection (a) for a fiscal 
     year shall be used for administrative expenses of the 
     Authority.
       ``(c) Minimum State Share of Grants.--Notwithstanding any 
     other provision of this subtitle, for any fiscal year, the 
     aggregate amount of grants received by a State and all 
     persons or entities in the State under this subtitle shall be 
     not less than \1/3\ of the product obtained by multiplying--
       ``(1) the aggregate amount of grants under this subtitle 
     for the fiscal year; and
       ``(2) the ratio that--
       ``(A) the population of the State (as determined by the 
     Secretary of Commerce based on the most recent decennial 
     census for which data are available); bears to
       ``(B) the population of the region (as so determined).

     ``SEC. 383N. TERMINATION OF AUTHORITY.

       ``The authority provided by this subtitle terminates 
     effective October 1, 2007.''.

     SEC. 6029. RURAL BUSINESS INVESTMENT PROGRAM.

       The Consolidated Farm and Rural Development Act (as amended 
     by section 6028) is amended by adding at the end the 
     following:
            ``Subtitle H--Rural Business Investment Program

     ``SEC. 384A. DEFINITIONS.

       ``In this subtitle:
       ``(1) Articles.--The term `articles' means articles of 
     incorporation for an incorporated body or the functional 
     equivalent or other similar documents specified by the 
     Secretary for other business entities.
       ``(2) Developmental venture capital.--The term 
     `developmental venture capital' means capital in the form of 
     equity capital investments in rural business investment 
     companies with an objective of fostering economic development 
     in rural areas.
       ``(3) Employee welfare benefit plan; pension plan.--
       ``(A) In general.--The terms `employee welfare benefit 
     plan' and `pension plan' have the meanings given the terms in 
     section 3 of the Employee Retirement Income Security Act of 
     1974 (29 U.S.C. 1002).
       ``(B) Inclusions.--The terms `employee welfare benefit 
     plan' and `pension plan' include--
       ``(i) public and private pension or retirement plans 
     subject to this subtitle; and
       ``(ii) similar plans not covered by this subtitle that have 
     been established, and that are maintained, by the Federal 
     Government or any State (including by a political 
     subdivision, agency, or instrumentality of the Federal 
     Government or a State) for the benefit of employees.
       ``(4) Equity capital.--The term `equity capital' means 
     common or preferred stock or a similar instrument, including 
     subordinated debt with equity features.
       ``(5) Leverage.--The term `leverage' includes--
       ``(A) debentures purchased or guaranteed by the Secretary;
       ``(B) participating securities purchased or guaranteed by 
     the Secretary; and
       ``(C) preferred securities outstanding as of the date of 
     enactment of this subtitle.
       ``(6) License.--The term `license' means a license issued 
     by the Secretary as provided in section 384D(e).
       ``(7) Limited liability company.--The term `limited 
     liability company' means a business entity that is organized 
     and operating in accordance with a State limited liability 
     company law approved by the Secretary.
       ``(8) Member.--The term `member' means, with respect to a 
     rural business investment company that is a limited liability 
     company, a holder of an ownership interest or a person 
     otherwise admitted to membership in the limited liability 
     company.
       ``(9) Operational assistance.--The term `operational 
     assistance' means management, marketing, and other technical 
     assistance that assists a rural business concern with 
     business development.
       ``(10) Participation agreement.--The term `participation 
     agreement' means an agreement, between the Secretary and a 
     rural business investment company granted final approval 
     under section 384D(e), that requires the rural business 
     investment company to make investments in smaller enterprises 
     in rural areas.
       ``(11) Private capital.--
       ``(A) In general.--The term `private capital' means the 
     total of--
       ``(i)(I) the paid-in capital and paid-in surplus of a 
     corporate rural business investment company;
       ``(II) the contributed capital of the partners of a 
     partnership rural business investment company; or
       ``(III) the equity investment of the members of a limited 
     liability company rural business investment company; and
       ``(ii) unfunded binding commitments from investors that 
     meet criteria established by the Secretary to contribute 
     capital to the rural business investment company, except 
     that--

       ``(I) unfunded commitments may be counted as private 
     capital for purposes of approval by the Secretary of any 
     request for leverage; but
       ``(II) leverage shall not be funded based on the 
     commitments.

       ``(B) Exclusions.--The term `private capital' does not 
     include--
       ``(i) any funds borrowed by a rural business investment 
     company from any source;
       ``(ii) any funds obtained through the issuance of leverage; 
     or
       ``(iii) any funds obtained directly or indirectly from the 
     Federal Government or any State (including by a political 
     subdivision, agency, or instrumentality of the Federal 
     Government or a State), except for--

       ``(I) funds obtained from the business revenues (excluding 
     any governmental appropriation) of any federally chartered or 
     government-sponsored enterprise established prior to the date 
     of enactment of this subtitle;
       ``(II) funds invested by an employee welfare benefit plan 
     or pension plan; and
       ``(III) any qualified nonprivate funds (if the investors of 
     the qualified nonprivate funds do not control, directly or 
     indirectly, the management, board of directors, general 
     partners, or members of the rural business investment 
     company).

       ``(12) Qualified nonprivate funds.--The term `qualified 
     nonprivate funds' means any--
       ``(A) funds directly or indirectly invested in any 
     applicant or rural business investment company on or before 
     the date of enactment of this subtitle, by any Federal 
     agency, other than the Department of Agriculture, under a 
     provision of law explicitly mandating the inclusion of those 
     funds in the definition of the term `private capital'; and

[[Page H1862]]

       ``(B) funds invested in any applicant or rural business 
     investment company by 1 or more entities of any State 
     (including by a political subdivision, agency, or 
     instrumentality of the State and including any guarantee 
     extended by those entities) in an aggregate amount that does 
     not exceed 33 percent of the private capital of the applicant 
     or rural business investment company.
       ``(13) Rural business concern.--The term `rural business 
     concern' means--
       ``(A) a public, private, or cooperative for-profit or 
     nonprofit organization;
       ``(B) a for-profit or nonprofit business controlled by an 
     Indian tribe on a Federal or State reservation or other 
     federally recognized Indian tribal group; or
       ``(C) any other person or entity;
     that primarily operates in a rural area, as determined by the 
     Secretary.
       ``(14) Rural business investment company.--The term `rural 
     business investment company' means a company that--
       ``(A) has been granted final approval by the Secretary 
     under section 384D(e); and
       ``(B) has entered into a participation agreement with the 
     Secretary.
       ``(15) Smaller enterprise.--The term `smaller enterprise' 
     means any rural business concern that, together with its 
     affiliates--
       ``(A) has--
       ``(i) a net financial worth of not more than $6,000,000, as 
     of the date on which assistance is provided under this 
     subtitle to the rural business concern; and
       ``(ii) an average net income for the 2-year period 
     preceding the date on which assistance is provided under this 
     subtitle to the rural business concern, of not more than 
     $2,000,000, after Federal income taxes (excluding any 
     carryover losses), except that, for purposes of this clause, 
     if the rural business concern is not required by law to pay 
     Federal income taxes at the enterprise level, but is required 
     to pass income through to the shareholders, partners, 
     beneficiaries, or other equitable owners of the business 
     concern, the net income of the business concern shall be 
     determined by allowing a deduction in an amount equal to the 
     total of--

       ``(I) if the rural business concern is not required by law 
     to pay State (and local, if any) income taxes at the 
     enterprise level, the net income (determined without regard 
     to this clause), multiplied by the marginal State income tax 
     rate (or by the combined State and local income tax rates, as 
     applicable) that would have applied if the business concern 
     were a corporation; and
       ``(II) the net income (so determined) less any deduction 
     for State (and local) income taxes calculated under subclause 
     (I), multiplied by the marginal Federal income tax rate that 
     would have applied if the rural business concern were a 
     corporation; or

       ``(B) satisfies the standard industrial classification size 
     standards established by the Administrator of the Small 
     Business Administration for the industry in which the rural 
     business concern is primarily engaged.

     ``SEC. 384B. PURPOSES.

       ``The purposes of the Rural Business Investment Program 
     established under this subtitle are--
       ``(1) to promote economic development and the creation of 
     wealth and job opportunities in rural areas and among 
     individuals living in those areas by encouraging 
     developmental venture capital investments in smaller 
     enterprises primarily located in rural areas; and
       ``(2) to establish a developmental venture capital program, 
     with the mission of addressing the unmet equity investment 
     needs of small enterprises located in rural areas, by 
     authorizing the Secretary--
       ``(A) to enter into participation agreements with rural 
     business investment companies;
       ``(B) to guarantee debentures of rural business investment 
     companies to enable each rural business investment company to 
     make developmental venture capital investments in smaller 
     enterprises in rural areas; and
       ``(C) to make grants to rural business investment 
     companies, and to other entities, for the purpose of 
     providing operational assistance to smaller enterprises 
     financed, or expected to be financed, by rural business 
     investment companies.

     ``SEC. 384C. ESTABLISHMENT.

       ``In accordance with this subtitle, the Secretary shall 
     establish a Rural Business Investment Program, under which 
     the Secretary may--
       ``(1) enter into participation agreements with companies 
     granted final approval under section 384D(e) for the purposes 
     set forth in section 384B;
       ``(2) guarantee the debentures issued by rural business 
     investment companies as provided in section 384E; and
       ``(3) make grants to rural business investment companies, 
     and to other entities, under section 384H.

     ``SEC. 384D. SELECTION OF RURAL BUSINESS INVESTMENT 
                   COMPANIES.

       ``(a) Eligibility.--A company shall be eligible to apply to 
     participate, as a rural business investment company, in the 
     program established under this subtitle if--
       ``(1) the company is a newly formed for-profit entity or a 
     newly formed for-profit subsidiary of such an entity;
       ``(2) the company has a management team with experience in 
     community development financing or relevant venture capital 
     financing; and
       ``(3) the company will invest in enterprises that will 
     create wealth and job opportunities in rural areas, with an 
     emphasis on smaller enterprises.
       ``(b) Application.--To participate, as a rural business 
     investment company, in the program established under this 
     subtitle, a company meeting the eligibility requirements of 
     subsection (a) shall submit an application to the Secretary 
     that includes--
       ``(1) a business plan describing how the company intends to 
     make successful developmental venture capital investments in 
     identified rural areas;
       ``(2) information regarding the community development 
     finance or relevant venture capital qualifications and 
     general reputation of the management of the company;
       ``(3) a description of how the company intends to work with 
     community-based organizations and local entities (including 
     local economic development companies, local lenders, and 
     local investors) and to seek to address the unmet equity 
     capital needs of the communities served;
       ``(4) a proposal describing how the company intends to use 
     the grant funds provided under this subtitle to provide 
     operational assistance to smaller enterprises financed by the 
     company, including information regarding whether the company 
     intends to use licensed professionals, as necessary, on the 
     staff of the company or from an outside entity;
       ``(5) with respect to binding commitments to be made to the 
     company under this subtitle, an estimate of the ratio of cash 
     to in-kind contributions;
       ``(6) a description of the criteria to be used to evaluate 
     whether and to what extent the company meets the purposes of 
     the program established under this subtitle;
       ``(7) information regarding the management and financial 
     strength of any parent firm, affiliated firm, or any other 
     firm essential to the success of the business plan of the 
     company; and
       ``(8) such other information as the Secretary may require.
       ``(c) Status.--Not later than 90 days after the initial 
     receipt by the Secretary of an application under this 
     section, the Secretary shall provide to the applicant a 
     written report describing the status of the application and 
     any requirements remaining for completion of the application.
       ``(d) Matters Considered.--In reviewing and processing any 
     application under this section, the Secretary--
       ``(1) shall determine whether--
       ``(A) the applicant meets the requirements of subsection 
     (e); and
       ``(B) the management of the applicant is qualified and has 
     the knowledge, experience, and capability necessary to comply 
     with this subtitle;
       ``(2) shall take into consideration--
       ``(A) the need for and availability of financing for rural 
     business concerns in the geographic area in which the 
     applicant is to commence business;
       ``(B) the general business reputation of the owners and 
     management of the applicant; and
       ``(C) the probability of successful operations of the 
     applicant, including adequate profitability and financial 
     soundness; and
       ``(3) shall not take into consideration any projected 
     shortage or unavailability of grant funds or leverage.
       ``(e) Approval; License.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     Secretary may approve an applicant to operate as a rural 
     business investment company under this subtitle and license 
     the applicant as a rural business investment company, if--
       ``(A) the Secretary determines that the application 
     satisfies the requirements of subsection (b);
       ``(B) the area in which the rural business investment 
     company is to conduct its operations, and establishment of 
     branch offices or agencies (if authorized by the articles), 
     are approved by the Secretary; and
       ``(C) the applicant enters into a participation agreement 
     with the Secretary.
       ``(2) Capital requirements.--
       ``(A) In general.--Notwithstanding any other provision of 
     this subtitle, the Secretary may approve an applicant to 
     operate as a rural business investment company under this 
     subtitle and designate the applicant as a rural business 
     investment company, if the Secretary determines that the 
     applicant--
       ``(i) has private capital of more than $2,500,000;
       ``(ii) would otherwise be approved under this subtitle, 
     except that the applicant does not satisfy the requirements 
     of section 384I(c); and
       ``(iii) has a viable business plan that--

       ``(I) reasonably projects profitable operations; and

       ``(II) has a reasonable timetable for achieving a level of 
     private capital that satisfies the requirements of section 
     384I(c).

       ``(B) Leverage.--An applicant approved under subparagraph 
     (A) shall not be eligible to receive leverage under this 
     subtitle until the applicant satisfies the requirements of 
     section 384I(c).
       ``(C) Grants.--An applicant approved under subparagraph (A) 
     shall be eligible for grants under section 384H in proportion 
     to the private capital of the applicant, as determined by the 
     Secretary.

     ``SEC. 384E. DEBENTURES.

       ``(a) In General.--The Secretary may guarantee the timely 
     payment of principal and interest, as scheduled, on 
     debentures issued by any rural business investment company.
       ``(b) Terms and Conditions.--The Secretary may make 
     guarantees under this section on such terms and conditions as 
     the Secretary considers appropriate, except that the term of 
     any debenture guaranteed under this section shall not exceed 
     15 years.
       ``(c) Full Faith and Credit of the United States.--Section 
     381H(i) shall apply to any guarantee under this section.
       ``(d) Maximum Guarantee.--Under this section, the Secretary 
     may--
       ``(1) guarantee the debentures issued by a rural business 
     investment company only to the

[[Page H1863]]

     extent that the total face amount of outstanding guaranteed 
     debentures of the rural business investment company does not 
     exceed the lesser of--
       ``(A) 300 percent of the private capital of the rural 
     business investment company; or
       ``(B) $105,000,000; and
       ``(2) provide for the use of discounted debentures.

     ``SEC. 384F. ISSUANCE AND GUARANTEE OF TRUST CERTIFICATES.

       ``(a) Issuance.--The Secretary may issue trust certificates 
     representing ownership of all or a fractional part of 
     debentures issued by a rural business investment company and 
     guaranteed by the Secretary under this subtitle, if the 
     certificates are based on and backed by a trust or pool 
     approved by the Secretary and composed solely of guaranteed 
     debentures.
       ``(b) Guarantee.--
       ``(1) In general.--The Secretary may, under such terms and 
     conditions as the Secretary considers appropriate, guarantee 
     the timely payment of the principal of and interest on trust 
     certificates issued by the Secretary or agents of the 
     Secretary for purposes of this section.
       ``(2) Limitation.--Each guarantee under this subsection 
     shall be limited to the extent of principal and interest on 
     the guaranteed debentures that compose the trust or pool.
       ``(3) Prepayment or default.--
       ``(A) In general.--In the event a debenture in a trust or 
     pool is prepaid, or in the event of default of such a 
     debenture, the guarantee of timely payment of principal and 
     interest on the trust certificates shall be reduced in 
     proportion to the amount of principal and interest the 
     prepaid debenture represents in the trust or pool.
       ``(B) Interest.--Interest on prepaid or defaulted 
     debentures shall accrue and be guaranteed by the Secretary 
     only through the date of payment of the guarantee.
       ``(C) Redemption.--At any time during its term, a trust 
     certificate may be called for redemption due to prepayment or 
     default of all debentures.
       ``(c) Full Faith and Credit of the United States.--Section 
     381H(i) shall apply to any guarantee of a trust certificate 
     issued by the Secretary under this section.
       ``(d) Subrogation and Ownership Rights.--
       ``(1) Subrogation.--If the Secretary pays a claim under a 
     guarantee issued under this section, the claim shall be 
     subrogated fully to the rights satisfied by the payment.
       ``(2) Ownership rights.--No Federal, State, or local law 
     shall preclude or limit the exercise by the Secretary of the 
     ownership rights of the Secretary in a debenture residing in 
     a trust or pool against which 1 or more trust certificates 
     are issued under this section.
       ``(e) Management and Administration.--
       ``(1) Registration.--The Secretary shall provide for a 
     central registration of all trust certificates issued under 
     this section.
       ``(2) Creation of pools.--The Secretary may--
       ``(A) maintain such commercial bank accounts or investments 
     in obligations of the United States as may be necessary to 
     facilitate the creation of trusts or pools backed by 
     debentures guaranteed under this subtitle; and
       ``(B) issue trust certificates to facilitate the creation 
     of those trusts or pools.
       ``(3) Fidelity bond or insurance requirement.--Any agent 
     performing functions on behalf of the Secretary under this 
     paragraph shall provide a fidelity bond or insurance in such 
     amount as the Secretary considers to be necessary to fully 
     protect the interests of the United States.
       ``(4) Regulation of brokers and dealers.--The Secretary may 
     regulate brokers and dealers in trust certificates issued 
     under this section.
       ``(5) Electronic registration.--Nothing in this subsection 
     prohibits the use of a book-entry or other electronic form of 
     registration for trust certificates issued under this 
     section.

     ``SEC. 384G. FEES.

       ``(a) In General.--The Secretary may charge such fees as 
     the Secretary considers appropriate with respect to any 
     guarantee or grant issued under this subtitle.
       ``(b) Trust Certificate.--Notwithstanding subsection (a), 
     the Secretary shall not collect a fee for any guarantee of a 
     trust certificate under section 384F, except that any agent 
     of the Secretary may collect a fee approved by the Secretary 
     for the functions described in section 384F(e)(2).
       ``(c) License.--
       ``(1) In general.--The Secretary may prescribe fees to be 
     paid by each applicant for a license to operate as a rural 
     business investment company under this subtitle.
       ``(2) Use of amounts.--Fees collected under this 
     subsection--
       ``(A) shall be deposited in the account for salaries and 
     expenses of the Secretary; and
       ``(B) are authorized to be appropriated solely to cover the 
     costs of licensing examinations.

     ``SEC. 384H. OPERATIONAL ASSISTANCE GRANTS.

       ``(a) In General.--In accordance with this section, the 
     Secretary may make grants to rural business investment 
     companies and to other entities, as authorized by this 
     subtitle, to provide operational assistance to smaller 
     enterprises financed, or expected to be financed, by the 
     entities.
       ``(b) Terms.--Grants made under this section shall be made 
     over a multiyear period (not to exceed 10 years) under such 
     terms as the Secretary may require.
       ``(c) Use of Funds.--The proceeds of a grant made under 
     this section may be used by the rural business investment 
     company receiving the grant only to provide operational 
     assistance in connection with an equity or prospective equity 
     investment in a business located in a rural area.
       ``(d) Submission of Plans.--A rural business investment 
     company shall be eligible for a grant under this section only 
     if the rural business investment company submits to the 
     Secretary, in such form and manner as the Secretary may 
     require, a plan for use of the grant.
       ``(e) Grant Amount.--
       ``(1) Rural business investment companies.--The amount of a 
     grant made under this section to a rural business investment 
     company shall be equal to the lesser of--
       ``(A) 10 percent of the private capital raised by the rural 
     business investment company; or
       ``(B) $1,000,000.
       ``(2) Other entities.--The amount of a grant made under 
     this section to any entity other than a rural business 
     investment company shall be equal to the resources (in cash 
     or in kind) raised by the entity in accordance with the 
     requirements applicable to rural business investment 
     companies under this subtitle.

     ``SEC. 384I. RURAL BUSINESS INVESTMENT COMPANIES.

       ``(a) Organization.--For the purpose of this subtitle, a 
     rural business investment company shall--
       ``(1) be an incorporated body, a limited liability company, 
     or a limited partnership organized and chartered or otherwise 
     existing under State law solely for the purpose of performing 
     the functions and conducting the activities authorized by 
     this subtitle;
       ``(2)(A) if incorporated, have succession for a period of 
     not less than 30 years unless earlier dissolved by the 
     shareholders of the rural business investment company; and
       ``(B) if a limited partnership or a limited liability 
     company, have succession for a period of not less than 10 
     years; and
       ``(3) possess the powers reasonably necessary to perform 
     the functions and conduct the activities.
       ``(b) Articles.--The articles of any rural business 
     investment company--
       ``(1) shall specify in general terms--
       ``(A) the purposes for which the rural business investment 
     company is formed;
       ``(B) the name of the rural business investment company;
       ``(C) the area or areas in which the operations of the 
     rural business investment company are to be carried out;
       ``(D) the place where the principal office of the rural 
     business investment company is to be located; and
       ``(E) the amount and classes of the shares of capital stock 
     of the rural business investment company;
       ``(2) may contain any other provisions consistent with this 
     subtitle that the rural business investment company may 
     determine appropriate to adopt for the regulation of the 
     business of the rural business investment company and the 
     conduct of the affairs of the rural business investment 
     company; and
       ``(3) shall be subject to the approval of the Secretary.
       ``(c) Capital Requirements.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     private capital of each rural business investment company 
     shall be not less than--
       ``(A) $5,000,000; or
       ``(B) $10,000,000, with respect to each rural business 
     investment company authorized or seeking authority to issue 
     participating securities to be purchased or guaranteed by the 
     Secretary under this subtitle.
       ``(2) Exception.--The Secretary may, in the discretion of 
     the Secretary and based on a showing of special circumstances 
     and good cause, permit the private capital of a rural 
     business investment company described in paragraph (1)(B) to 
     be less than $10,000,000, but not less than $5,000,000, if 
     the Secretary determines that the action would not create or 
     otherwise contribute to an unreasonable risk of default or 
     loss to the Federal Government.
       ``(3) Adequacy.--In addition to the requirements of 
     paragraph (1), the Secretary shall--
       ``(A) determine whether the private capital of each rural 
     business investment company is adequate to ensure a 
     reasonable prospect that the rural business investment 
     company will be operated soundly and profitably, and managed 
     actively and prudently in accordance with the articles of the 
     rural business investment company;
       ``(B) determine that the rural business investment company 
     will be able to comply with the requirements of this 
     subtitle;
       ``(C) require that at least 75 percent of the capital of 
     each rural business investment company is invested in rural 
     business concerns and not more than 10 percent of the 
     investments shall be made in an area containing a city of 
     over 150,000 in the last decennial census and the Census 
     Bureau defined urbanized area containing or adjacent to that 
     city;
       ``(D) ensure that the rural business investment company is 
     designed primarily to meet equity capital needs of the 
     businesses in which the rural business investment company 
     invests and not to compete with traditional small business 
     financing by commercial lenders; and
       ``(E) require that the rural business investment company 
     makes short-term non-equity investments of less than 5 years 
     only to the extent necessary to preserve an existing 
     investment.
       ``(d) Diversification of Ownership.--The Secretary shall 
     ensure that the management of each rural business investment 
     company licensed after the date of enactment of this subtitle 
     is sufficiently diversified from and unaffiliated with the 
     ownership of the rural business investment company so as to 
     ensure independence and objectivity in the financial 
     management and oversight of the investments and operations of 
     the rural business investment company.

     ``SEC. 384J. FINANCIAL INSTITUTION INVESTMENTS.

       ``(a) In General.--Except as otherwise provided in this 
     section and notwithstanding any other provision of law, the 
     following banks, associations, and institutions are eligible 
     both to

[[Page H1864]]

     establish and invest in any rural business investment company 
     or in any entity established to invest solely in rural 
     business investment companies:
       ``(1) Any bank or savings association the deposits of which 
     are insured under the Federal Deposit Insurance Act (12 
     U.S.C. 1811 et seq.).
       ``(2) Any Farm Credit System institution described in 
     section 1.2(a) of the Farm Credit Act of 1971 (12 U.S.C. 
     2002(a)).
       ``(b) Limitation.--No bank, association, or institution 
     described in subsection (a) may make investments described in 
     subsection (a) that are greater than 5 percent of the capital 
     and surplus of the bank, association, or institution.
       ``(c) Limitation on Rural Business Investment Companies 
     Controlled by Farm Credit System Institutions.--If a Farm 
     Credit System institution described in section 1.2(a) of the 
     Farm Credit Act of 1971 (12 U.S.C. 2002(a)) holds more than 
     15 percent of the shares of a rural business investment 
     company, either alone or in conjunction with other System 
     institutions (or affiliates), the rural business investment 
     company shall not provide equity investments in, or provide 
     other financial assistance to, entities that are not 
     otherwise eligible to receive financing from the Farm Credit 
     System under that Act (12 U.S.C. 2001 et seq.).

     ``SEC. 384K. REPORTING REQUIREMENTS.

       ``(a) Rural Business Investment Companies.--Each rural 
     business investment company that participates in the program 
     established under this subtitle shall provide to the 
     Secretary such information as the Secretary may require, 
     including--
       ``(1) information relating to the measurement criteria that 
     the rural business investment company proposed in the program 
     application of the rural business investment company; and
       ``(2) in each case in which the rural business investment 
     company under this subtitle makes an investment in, or a loan 
     or grant to, a business that is not located in a rural area, 
     a report on the number and percentage of employees of the 
     business who reside in those areas.
       ``(b) Public Reports.--
       ``(1) In general.--The Secretary shall prepare and make 
     available to the public an annual report on the program 
     established under this subtitle, including detailed 
     information on--
       ``(A) the number of rural business investment companies 
     licensed by the Secretary during the previous fiscal year;
       ``(B) the aggregate amount of leverage that rural business 
     investment companies have received from the Federal 
     Government during the previous fiscal year;
       ``(C) the aggregate number of each type of leveraged 
     instruments used by rural business investment companies 
     during the previous fiscal year and how each number compares 
     to previous fiscal years;
       ``(D) the number of rural business investment company 
     licenses surrendered and the number of rural business 
     investment companies placed in liquidation during the 
     previous fiscal year, identifying the amount of leverage each 
     rural business investment company has received from the 
     Federal Government and the type of leverage instruments each 
     rural business investment company has used;
       ``(E) the amount of losses sustained by the Federal 
     Government as a result of operations under this subtitle 
     during the previous fiscal year and an estimate of the total 
     losses that the Federal Government can reasonably expect to 
     incur as a result of the operations during the current fiscal 
     year;
       ``(F) actions taken by the Secretary to maximize recoupment 
     of funds of the Federal Government expended to implement and 
     administer the Rural Business Investment Program under this 
     subtitle during the previous fiscal year and to ensure 
     compliance with the requirements of this subtitle (including 
     regulations);
       ``(G) the amount of Federal Government leverage that each 
     licensee received in the previous fiscal year and the types 
     of leverage instruments each licensee used;
       ``(H) for each type of financing instrument, the sizes, 
     types of geographic locations, and other characteristics of 
     the small business investment companies using the instrument 
     during the previous fiscal year, including the extent to 
     which the investment companies have used the leverage from 
     each instrument to make loans or equity investments in rural 
     areas; and
       ``(I) the actions of the Secretary to carry out this 
     subtitle.
       ``(2) Prohibition.--In compiling the report required under 
     paragraph (1), the Secretary may not--
       ``(A) compile the report in a manner that permits 
     identification of any particular type of investment by an 
     individual rural business investment company or small 
     business concern in which a rural business investment company 
     invests; and
       ``(B) may not release any information that is prohibited 
     under section 1905 of title 18, United States Code.

     ``SEC. 384L. EXAMINATIONS.

       ``(a) In General.--Each rural business investment company 
     that participates in the program established under this 
     subtitle shall be subject to examinations made at the 
     direction of the Secretary in accordance with this section.
       ``(b) Assistance of Private Sector Entities.--An 
     examination under this section may be conducted with the 
     assistance of a private sector entity that has the 
     qualifications and the expertise necessary to conduct such an 
     examination.
       ``(c) Costs.--
       ``(1) In general.--The Secretary may assess the cost of an 
     examination under this section, including compensation of the 
     examiners, against the rural business investment company 
     examined.
       ``(2) Payment.--Any rural business investment company 
     against which the Secretary assesses costs under this 
     paragraph shall pay the costs.
       ``(d) Deposit of Funds.--Funds collected under this section 
     shall--
       ``(1) be deposited in the account that incurred the costs 
     for carrying out this section;
       ``(2) be made available to the Secretary to carry out this 
     section, without further appropriation; and
       ``(3) remain available until expended.

     ``SEC. 384M. INJUNCTIONS AND OTHER ORDERS.

       ``(a) In General.--
       ``(1) Application by secretary.--Whenever, in the judgment 
     of the Secretary, a rural business investment company or any 
     other person has engaged or is about to engage in any act or 
     practice that constitutes or will constitute a violation of a 
     provision of this subtitle (including any rule, regulation, 
     order, or participation agreement under this subtitle), the 
     Secretary may apply to the appropriate district court of the 
     United States for an order enjoining the act or practice, or 
     for an order enforcing compliance with the provision, rule, 
     regulation, order, or participation agreement.
       ``(2) Jurisdiction; relief.--The court shall have 
     jurisdiction over the action and, on a showing by the 
     Secretary that the rural business investment company or other 
     person has engaged or is about to engage in an act or 
     practice described in paragraph (1), a permanent or temporary 
     injunction, restraining order, or other order, shall be 
     granted without bond.
       ``(b) Jurisdiction.--
       ``(1) In general.--In any proceeding under subsection (a), 
     the court as a court of equity may, to such extent as the 
     court considers necessary, take exclusive jurisdiction over 
     the rural business investment company and the assets of the 
     rural business investment company, wherever located.
       ``(2) Trustee or receiver.--The court shall have 
     jurisdiction in any proceeding described in paragraph (1) to 
     appoint a trustee or receiver to hold or administer the 
     assets.
       ``(c) Secretary As Trustee or Receiver.--
       ``(1) Authority.--The Secretary may act as trustee or 
     receiver of a rural business investment company.
       ``(2) Appointment.--On the request of the Secretary, the 
     court shall appoint the Secretary to act as a trustee or 
     receiver of a rural business investment company unless the 
     court considers the appointment inequitable or otherwise 
     inappropriate by reason of any special circumstances 
     involved.

     ``SEC. 384N. ADDITIONAL PENALTIES FOR NONCOMPLIANCE.

       ``(a) In General.--With respect to any rural business 
     investment company that violates or fails to comply with this 
     subtitle (including any rule, regulation, order, or 
     participation agreement under this subtitle), the Secretary 
     may, in accordance with this section--
       ``(1) void the participation agreement between the 
     Secretary and the rural business investment company; and
       ``(2) cause the rural business investment company to 
     forfeit all of the rights and privileges derived by the rural 
     business investment company under this subtitle.
       ``(b) Adjudication of Noncompliance.--
       ``(1) In general.--Before the Secretary may cause a rural 
     business investment company to forfeit rights or privileges 
     under subsection (a), a court of the United States of 
     competent jurisdiction must find that the rural business 
     investment company committed a violation, or failed to 
     comply, in a cause of action brought for that purpose in the 
     district, territory, or other place subject to the 
     jurisdiction of the United States, in which the principal 
     office of the rural business investment company is located.
       ``(2) Parties authorized to file causes of action.--Each 
     cause of action brought by the United States under this 
     subsection shall be brought by the Secretary or by the 
     Attorney General.

     ``SEC. 384O. UNLAWFUL ACTS AND OMISSIONS; BREACH OF FIDUCIARY 
                   DUTY.

       ``(a) Parties Deemed To Commit a Violation.--Whenever any 
     rural business investment company violates this subtitle 
     (including any rule, regulation, order, or participation 
     agreement under this subtitle), by reason of the failure of 
     the rural business investment company to comply with this 
     subtitle or by reason of its engaging in any act or practice 
     that constitutes or will constitute a violation of this 
     subtitle, the violation shall also be deemed to be a 
     violation and an unlawful act committed by any person that, 
     directly or indirectly, authorizes, orders, participates in, 
     causes, brings about, counsels, aids, or abets in the 
     commission of any acts, practices, or transactions that 
     constitute or will constitute, in whole or in part, the 
     violation.
       ``(b) Fiduciary Duties.--It shall be unlawful for any 
     officer, director, employee, agent, or other participant in 
     the management or conduct of the affairs of a rural business 
     investment company to engage in any act or practice, or to 
     omit any act or practice, in breach of the fiduciary duty of 
     the officer, director, employee, agent, or participant if, as 
     a result of the act or practice, the rural business 
     investment company suffers or is in imminent danger of 
     suffering financial loss or other damage.
       ``(c) Unlawful Acts.--Except with the written consent of 
     the Secretary, it shall be unlawful--
       ``(1) for any person to take office as an officer, 
     director, or employee of any rural business investment 
     company, or to become an agent or participant in the conduct 
     of the affairs or management of a rural business investment 
     company, if the person--
       ``(A) has been convicted of a felony, or any other criminal 
     offense involving dishonesty or breach of trust; or
       ``(B) has been found liable in a civil action for damages, 
     or has been permanently or temporarily enjoined by an order, 
     judgment, or decree

[[Page H1865]]

     of a court of competent jurisdiction, by reason of any act or 
     practice involving fraud or breach of trust; and
       ``(2) for any person to continue to serve in any of the 
     capacities described in paragraph (1), if--
       ``(A) the person is convicted of a felony or any other 
     criminal offense involving dishonesty or breach of trust; or
       ``(B) the person is found liable in a civil action for 
     damages, or is permanently or temporarily enjoined by an 
     order, judgment, or decree of a court of competent 
     jurisdiction, by reason of any act or practice involving 
     fraud or breach of trust.

     ``SEC. 384P. REMOVAL OR SUSPENSION OF DIRECTORS OR OFFICERS.

       ``Using the procedures established by the Secretary for 
     removing or suspending a director or an officer of a rural 
     business investment company, the Secretary may remove or 
     suspend any director or officer of any rural business 
     investment company.

     ``SEC. 384Q. CONTRACTING OF FUNCTIONS.

       ``(a) In General.--Notwithstanding any other provision of 
     law, to carry out the day-to-day management and operation of 
     the program authorized by this subtitle on behalf of the 
     Secretary, the Secretary shall enter into an interagency 
     agreement under section 1535 of title 31, United States Code, 
     with another Federal agency that has considerable expertise 
     in operating a program under which capital is provided for 
     equity investments in private sector companies.
       ``(b) Funding.--The costs incurred by a Federal agency 
     entering into an agreement under subsection (a) shall be 
     reimbursed in accordance with section 1535 of title 31, 
     United States Code, from amounts made available under section 
     384S(a)(2).

     ``SEC. 384R. REGULATIONS.

       ``The Secretary may promulgate such regulations as the 
     Secretary considers necessary to carry out this subtitle.

     ``SEC. 384S. FUNDING.

       ``(a) In General.--Notwithstanding any other provision of 
     law, of the funds of the Commodity Credit Corporation, the 
     Secretary shall make available--
       ``(1) such sums as may be necessary for the cost of 
     guaranteeing $280,000,000 of debentures under this subtitle; 
     and
       ``(2) $44,000,000 to make grants under this subtitle.
       ``(b) Availability of Funds.--Funds transferred under 
     subsection (a) shall remain available until expended.''.

     SEC. 6030. RURAL STRATEGIC INVESTMENT PROGRAM.

       The Consolidated Farm and Rural Development Act (as amended 
     by section 6029) is amended by adding at the end the 
     following:
            ``Subtitle I--Rural Strategic Investment Program

     ``SEC. 385A. PURPOSE.

       ``The purpose of this subtitle is to establish a rural 
     strategic investment program--
       ``(1) to provide rural communities with flexible resources 
     to develop comprehensive, collaborative, and locally-based 
     strategic planning processes; and
       ``(2) to implement innovative community and economic 
     development strategies that optimize regional competitive 
     advantages.

     ``SEC. 385B. DEFINITIONS.

       ``In this subtitle:
       ``(1) Benchmark.--The term `benchmark' means an annual set 
     of strategies and goals of a Regional Board established for 
     the purpose of measuring performance in meeting the regional 
     plan of the Regional Board.
       ``(2) Conference.--The term ``Conference'' means the 
     National Conference on Rural America conducted under section 
     385H.
       ``(3) Eligible area.--
       ``(A) In general.--The term `eligible area' means a 
     nonmetropolitan county (as defined by the Secretary) that has 
     a population of 50,000 inhabitants or less.
       ``(B) Inclusion.--
       ``(i) In general.--Subject to clause (ii), the term 
     `eligible area' includes an unincorporated or other area of a 
     county that has a population of more than 50,000 inhabitants 
     if the unincorporated area or other area is adjacent to an 
     eligible rural area described in subparagraph (A).
       ``(ii) Participation.--An area described in clause (i) may 
     be represented on a Regional Board.
       ``(C) Exclusion.--The term `eligible area' does not include 
     any area designated by the Secretary as a rural empowerment 
     zone or rural enterprise community.
       ``(4) Innovation grant.--The term `innovation grant' means 
     an innovation grant made by the National Board to a Regional 
     Board under section 385G.
       ``(5) National board.--The term `National Board' means the 
     National Board on Rural America established under section 
     385D(a).
       ``(6) National plan.--The term `national plan' means a 
     national strategic investment plan of the National Board 
     developed under section 385D(d)(3).
       ``(7) Planning grant.--The term `planning grant' means a 
     regional strategic investment planning grant made by the 
     National Board to a Regional Board under section 385F.
       ``(8) Program.--The term `program' means the rural 
     strategic investment program established under this subtitle.
       ``(9) Region.--The term `region' means the eligible areas 
     that--
       ``(A) are under the jurisdiction of a Regional Board; and
       ``(B) meet criteria established by the National Board not 
     later than 1 year after the date of enactment of this 
     subtitle.
       ``(10) Regional board.--The term `Regional Board' means a 
     Regional Investment Board certified under section 385C(a).
       ``(11) Regional plan.--The term `regional plan' means a 
     regional strategic investment plan of a Regional Board 
     developed under section 385C(b)(3)(B).

     ``SEC. 385C. REGIONAL INVESTMENT BOARDS.

       ``(a) In General.--The National Board may certify a group 
     representing the interests described in subsection (b)(2)(A) 
     as a Regional Investment Board created to develop and 
     implement a regional strategic investment plan for grants 
     made under this subtitle to promote investment in eligible 
     areas.
       ``(b) Requirements for Certification.--
       ``(1) In general.--A Regional Board shall meet the 
     requirements of this subsection for certification.
       ``(2) Composition.--
       ``(A) In general.--A Regional Board shall be composed of 
     residents of the region that broadly represent diverse 
     public, nonprofit, and private sector interests in investment 
     in the region, including (to the maximum extent practicable) 
     representatives of--
       ``(i) units of local government (including 
     multijurisdictional units of local government);
       ``(ii) in the case of regions with Indian populations, 
     Indian tribes (as defined in section 4 of the Indian Self-
     Determination and Education Assistance Act (25 U.S.C. 450b));
       ``(iii) private nonprofit community-based development 
     organizations;
       ``(iv) regional development organizations;
       ``(v) private business organizations;
       ``(vi) other entities and organizations, as determined by 
     the Regional Board; and
       ``(vii) consortia of entities and organizations described 
     in clauses (i) through (vii).
       ``(B) Local public-private representation.--Of the members 
     of a Regional Board, to the maximum extent practicable--
       ``(i) \1/2\ of the members shall be representatives of 
     units of local government and Indian tribes described in 
     subparagraph (A); and
       ``(ii) \1/2\ of the members shall be representatives of 
     nonprofit, regional, private, and other entities and 
     organizations described in subparagraph (A).
       ``(C) Ex-officio members.--
       ``(i) In general.--An officer or employee of a Federal or 
     State agency may serve as an ex-officio, non-voting member of 
     a Regional Board representing the agency.
       ``(ii) Conflicts.--Participation by a Federal officer or 
     employee in activities of the Regional Board shall not 
     constitute a violation of section 205 or 208 of title 18, 
     United States Code.
       ``(D) Certification.--To be certified by the National 
     Board, a Regional Board shall demonstrate to the National 
     Board that the Regional Board is broadly representative of 
     the interests described in subparagraph (A).
       ``(E) Appeals.--
       ``(i) In general.--Prior to certification of the Regional 
     Board by the National Board, representatives of interests 
     described in subparagraph (A) that participated in the 
     development of a Regional Board may appeal the composition of 
     the Regional Board to the National Board on the ground that--

       ``(I) the composition of the Regional Board does not 
     adequately reflect the purposes of the program; or
       ``(II) the selection process for the Regional Board 
     unfairly disadvantaged those interests.

       ``(ii) Action by national board.--The National Board shall 
     act on any appeal of the composition of a Regional Board 
     before taking action on the certification of the Regional 
     Board.
       ``(3) Duties and purpose.--The organizational documents of 
     the proposed Regional Board shall demonstrate that, on 
     certification, the Regional Board shall--
       ``(A) create a collaborative, inclusive public-private 
     planning process;
       ``(B) develop, and submit to the National Board for 
     approval, a regional strategic investment plan that meets the 
     requirements of section 385F, with benchmarks, to promote 
     investment in eligible areas through the use of grants made 
     available under this subtitle;
       ``(C) implement the approved regional plan;
       ``(D) provide annual reports to the Secretary and the 
     National Board on progress made in achieving the benchmarks 
     of the regional plan, including an annual financial 
     statement; and
       ``(E) select a non-Federal organization (such as a regional 
     development organization) in the local area served by the 
     Regional Board that has previous experience in the management 
     of Federal funds to serve as fiscal manager of any funds of 
     the Regional Board.

     ``SEC. 385D. NATIONAL BOARD ON RURAL AMERICA.

       ``(a) Establishment.--
       ``(1) In general.--The Secretary shall establish a National 
     Board on Rural America to carry out the rural strategic 
     investment program established under this subtitle.
       ``(2) Supervision and direction.--Except as otherwise 
     provided in this subtitle, the National Board shall be 
     subject to the general supervision and direction of the 
     Secretary.
       ``(b) Composition.--
       ``(1) In general.--
       ``(A) Appointment.--In addition to the Secretary or the 
     designee of the Secretary, the National Board shall consist 
     of 14 members appointed by the Secretary from among--
       ``(i) representatives of nationally recognized 
     entrepreneurship organizations;
       ``(ii) representatives of regional planning and development 
     organizations;
       ``(iii) representatives of community-based organizations;
       ``(iv) elected members of county governments;
       ``(v) elected members of State legislatures;
       ``(vi) representatives of the rural philanthropic 
     community; and
       ``(vii) representatives of Indian tribes (as defined in 
     section 4 of the Indian Self-Determination and Education 
     Assistance Act (25 U.S.C. 450b)).

[[Page H1866]]

       ``(B) Recommendations.--In appointing the members of the 
     National Board under subparagraph (A), the Secretary shall 
     consider recommendations made by--
       ``(i) the chairman and ranking member of each of the 
     Committee on Agriculture of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate;
       ``(ii) the Majority Leader of the Senate; and
       ``(iii) the Speaker of the House of Representatives.
       ``(3) Term of office.--
       ``(A) In general.--Subject to subparagraph (B), the term of 
     office of a member of the National Board appointed under 
     paragraph (1)(A) shall be 4 years.
       ``(B) Staggered initial terms.--Of the initial members of 
     the National Board appointed under paragraph (1)(A), the term 
     of office of--
       ``(i) 5 members shall be 4 years;
       ``(ii) 5 members shall be 3 years; and
       ``(iii) 4 members shall be 2 years.
       ``(4) Initial appointments.--Not later than 90 days after 
     the date of enactment of this subtitle, the Secretary shall 
     appoint the initial members of the National Board under 
     paragraph (1)(A).
       ``(5) Ex-officio members.--
       ``(A) Special assistant to the president for rural 
     policy.--If appointed by the President under section 6406(1) 
     of the Farm Security and Rural Investment Act of 2002, the 
     Special Assistant to the President for Rural Policy shall 
     serve as an ex-officio, non-voting member of the National 
     Board.
       ``(B) Other members.--In consultation with the chairman and 
     ranking member of each of the Committee on Agriculture of the 
     House of Representatives and the Committee on Agriculture, 
     Nutrition, and Forestry of the Senate, the Secretary may 
     appoint not more than 3 other officers or employees of the 
     Executive Branch to serve as ex-officio, non-voting members 
     of the National Board.
       ``(6) Vacancies.--A vacancy on the National Board shall be 
     filled in the same manner as the original appointment.
       ``(7) Compensation.--A member of the National Board shall 
     receive no compensation for service on the National Board, 
     but shall be reimbursed for travel and other expenses 
     incurred in carrying out the duties of the member of the 
     National Board in accordance with section 5702 and 5703 of 
     title 5, United States Code.
       ``(8) Chairperson.--The National Board shall select a 
     chairperson from among the members of the National Board.
       ``(9) Meetings.--
       ``(A) Time and place.--The National Board shall meet at the 
     call of the chairperson.
       ``(B) Quorum.--A quorum of the National Board shall consist 
     of a majority of the members.
       ``(C) Majority vote.--A decision of the National Board 
     shall be made by majority vote.
       ``(10) Federal status.--For purposes of Federal law, a 
     member of the National Board shall be considered a special 
     Government employee (as defined in section 202(a) of title 
     18, United States Code).
       ``(11) Conflict of interest.--
       ``(A) In general.--Except as provided in subparagraph (C), 
     no member of the National Board shall vote on any matter 
     respecting any application for a grant or other particular 
     matter pending before the National Board in which, to the 
     knowledge of the member, the member, spouse, or child of the 
     member, partner, or organization in which the member is 
     serving as officer, director, trustee, partner, or employee, 
     or any person or organization with whom the member is 
     negotiating or has any arrangement concerning prospective 
     employment, has a financial interest.
       ``(B) Violations.--A violation of subparagraph (A) by a 
     member of the National Board shall be cause for removal of 
     the member, but shall not impair or otherwise affect the 
     validity of any otherwise lawful action by the National Board 
     in which the member participated.
       ``(C) Exception.--Subparagraph (A) shall not apply to the 
     extent a member of the National Board advises the National 
     Board of the nature of the particular matter in which the 
     member proposes to participate, if--
       ``(i) the member makes a full disclosure of the financial 
     interest; and
       ``(ii) prior to any participation by the member, the 
     National Board determines, by majority vote of the other 
     members of the National Board, that the financial interest is 
     too remote or too inconsequential to affect the integrity of 
     the services of the member to the National Board in that 
     matter.
       ``(c) Administrative Support.--The Secretary, on a 
     reimbursable basis, may provide such administrative support 
     to the National Board as the Secretary determines is 
     necessary to carry out the duties of the National Board.
       ``(d) Duties.--The National Board shall--
       ``(1) certify Regional Boards in accordance with section 
     385C, with the initial certification of Regional Boards 
     occurring not later than 540 days after the date of enactment 
     of this subtitle;
       ``(2) approve, negotiate, or disapprove each regional plan 
     that is submitted by a Regional Board to the National Board 
     under section 385C;
       ``(3) develop, and submit to the Secretary for approval, a 
     national strategic investment plan;
       ``(4) use the amount received from the Secretary under 
     section 385E to make planning grants and innovation grants to 
     Regional Boards and to otherwise carry out the program;
       ``(5) provide leadership and advice to Regional Boards on 
     issues, best practices, and emerging trends relating to rural 
     development;
       ``(6) evaluate the progress of each Regional Board in 
     achieving the benchmarks of the regional plan using annual 
     reports submitted under section 385C(b)(3)(D) and any other 
     information that is available to the Regional Board; and
       ``(7) submit an annual report on the performance of 
     Regional Boards and the program to--
       ``(A) the Committee on Agriculture of the House of 
     Representatives;
       ``(B) the Committee on Agriculture, Nutrition, and Forestry 
     of the Senate; and
       ``(C) the Secretary.

     ``SEC. 385E. RURAL STRATEGIC INVESTMENT PROGRAM.

       ``(a) In General.--If the Secretary approves a national 
     strategic investment plan submitted by the National Board, of 
     the funds of the Commodity Credit Corporation, the Secretary 
     shall transfer to the National Board $100,000,000, to remain 
     available until expended, for the Board to use to make 
     planning grants and innovation grants to Regional Boards and 
     to otherwise carry out this subtitle.
       ``(b) Use by National Board.--Of the amount transferred by 
     the Secretary to the National Board under subsection (a), the 
     National Board shall use--
       ``(1) not less than $8,000,000 to make planning grants to 
     Regional Boards under section 385F;
       ``(2) not less than $87,000,000 to make innovation grants 
     to Regional Boards under section 385G; and
       ``(3) the remainder of the funds to carry out section 385H 
     and administer this subtitle (other than section 385H).

     ``SEC. 385F. REGIONAL STRATEGIC INVESTMENT PLANNING GRANTS.

       ``(a) In General.--The National Board shall use amounts 
     made available under section 385E(b)(1) to make not fewer 
     than 80 planning grants, on a competitive basis, to applicant 
     Regional Boards to develop, maintain, evaluate, and report 
     progress on regional strategic investment plans in accordance 
     with section 385C and this section.
       ``(b) Regional Plans.--A regional plan for a region covered 
     by a Regional Board shall, to the maximum extent practicable, 
     cover--
       ``(1) basic infrastructure needs of the region;
       ``(2) basic services within the region;
       ``(3) opportunities for economic diversification and 
     innovation within the region, with particular attention to 
     entrepreneurial support and innovation;
       ``(4) the current and future human resource capacity of the 
     region;
       ``(5) access to market-based financing and venture and 
     equity capital in the region;
       ``(6) the development of innovative public and private 
     collaborations for investments in the region; and
       ``(7) other appropriate matters, as determined by the 
     National Board and the Secretary.
       ``(c) Preferences.--In awarding planning grants, the 
     National Board shall give a preference to planning grants 
     that will be used to address community capacity building and 
     community sustainability.
       ``(d) Amount.--The total amount of a planning grant made to 
     a Regional Board shall not exceed $100,000.
       ``(e) Cost Sharing.--
       ``(1) In general.--Subject to paragraphs (2) and (3), the 
     share of the costs of developing, maintaining, evaluating, 
     and reporting on a regional plan funded by a grant under this 
     section shall not exceed 50 percent.
       ``(2) Form.--
       ``(A) In general. Except as provided in subparagraph (B), a 
     Regional Board shall pay the grantee share of the costs 
     described in paragraph (1) in the form of cash, services, 
     materials, or other in-kind contributions.
       ``(B) Limitation.--A grantee shall not pay more than 50 
     percent of the grantee share in the form of services, 
     materials, or other in-kind contributions.
       ``(3) Increased share.--The National Board may increase the 
     share of the costs covered by a planning grant made to a 
     Regional Board under this section if a limited ability of the 
     Regional Board to pay would otherwise create a barrier to 
     full participation in the program.

     ``SEC. 385G. INNOVATION GRANTS.

       ``(a) In General.--The National Board shall use amounts 
     made available under section 385E(b)(2) to make innovation 
     grants, on a competitive basis, to Regional Boards to 
     implement projects that are identified in the regional plans 
     of the Regional Boards.
       ``(b) Eligibility.--
       ``(1) In general.--For a Regional Board to be eligible to 
     receive an innovation grant, the National Board shall 
     determine that--
       ``(A) the regional plan of a Regional Board meets the 
     requirements of this subtitle;
       ``(B) the management and organizational structure of the 
     Regional Board is sufficient to oversee grant projects;
       ``(C) the Regional Board will be able to provide the 
     grantee share required under this section; and
       ``(D) the Regional Board agrees to achieve, to the maximum 
     extent practicable, the performance-based benchmarks of the 
     regional plan.
       ``(2) Relationship to planning grants.--A Regional Board 
     that meets the requirements of paragraph (1) shall be 
     eligible to receive an innovation grant, regardless of 
     whether the Regional Board receives a planning grant.
       ``(c) Selection.--Subject to subsection (d), of the 
     applications submitted by Regional Boards for innovation 
     grants, the National Board shall, to the maximum extent 
     practicable, select not fewer than 30 regional boards to 
     receive innovation grants.
       ``(d) Preferences.--In awarding innovation grants, the 
     National Board shall give a preference (in order of priority) 
     to Regional Boards that--
       ``(1) exhibit collaborative innovation and 
     entrepreneurship, particularly within a public-private 
     partnership;
       ``(2) represent a broad coalition of interests described in 
     section 385C(b)(2)(A);

[[Page H1867]]

       ``(3) demonstrate a plan to leverage public (Federal and 
     non-federal) and private funds and existing assets, including 
     natural assets and public infrastructure;
       ``(4) address gaps in existing basic services within a 
     region;
       ``(5) address economic diversification, including 
     agricultural and non-agriculturally based economies, within a 
     regional framework;
       ``(6) demonstrate a plan to achieve multijurisdictional 
     regional planning and development, with particular evidence 
     of economic development successes within diverse stakeholder 
     frameworks; or
       ``(7) meet other community development needs identified by 
     a Regional Board.
       ``(e) Uses.--
       ``(1) Leverage.--A Regional Board shall prioritize 
     projects, in part, on the degree to which the Regional Board 
     is able to leverage additional funds for the implementation 
     of the projects.
       ``(2) Purposes.--A Regional Board may use an innovation 
     grant provided for a region--
       ``(A) to support the development of critical infrastructure 
     necessary to facilitate economic development in the region;
       ``(B) to provide assistance to entities within the region 
     that provide basic public services;
       ``(C) to assist with job training, workforce development, 
     or other needs related to the development and maintenance of 
     strong local and regional economies;
       ``(D) to assist in the development of unique new 
     collaborations that link public, private, and philanthropic 
     resources to achieve collaboratively designed regional 
     advancement; and
       ``(E) to provide support to business investment.
       ``(3) Other department programs.--A Regional Board may not 
     use an innovation grant provided for a region for any purpose 
     for which funding may be obtained under any other rural 
     development program of the Department of Agriculture unless--
       ``(A) the Regional Board--
       ``(i) has submitted an application for the funding under 
     the other program; and
       ``(ii) withdraws the application; and
       ``(B) the National Board approves use of the innovation 
     grant for that purpose.
       ``(4) Operating expenses.--A Regional Board may use for 
     administrative costs in carrying out programs and activities 
     related to the grant the greater of--
       ``(A) $100,000; or
       ``(B) 5 percent of the amount of an innovation grant 
     provided.
       ``(f) Amount.--
       ``(1) In general.--The amount of an innovation grant made 
     to a Regional Board shall not exceed $3,000,000.
       ``(2) Availability.--The amount of an innovation grant made 
     to a Regional Board shall remain available until expended.
       ``(g) Cost Sharing.--
       ``(1) In general.--Subject to paragraphs (2) and (3), the 
     share of the costs of projects covered by an innovation grant 
     made to a Regional Board under this section shall not exceed 
     75 percent, as determined by the National Board.
       ``(2) Form.--A Regional Board may pay the grantee share of 
     the costs of projects covered by an innovation grant in the 
     form of cash or services, materials, or other in-kind 
     contributions.
       ``(3) Waiver of grantee share.--The National Board may 
     waive the grantee share of the costs of projects covered by 
     an innovation grant made to a Regional Board under this 
     section if the National Board determines that such a waiver 
     is appropriate.
       ``(4) Other federal programs.--For the purpose of 
     determining grantee share requirements for any other Federal 
     programs, funds provided for innovation grants shall be 
     considered to be non-Federal funds.
       ``(h) Negotiation.--The National Board may--
       ``(1) negotiate with a Regional Board on the substance, 
     size, and scope of a regional plan; and
       ``(2) approve an innovation grant for an amount that is 
     lower than the amount requested by the Regional Board.
       ``(i) Noncompliance.--If a Regional Board fails to comply 
     with the requirements of this section, the National Board may 
     take such actions as are necessary to obtain reimbursement of 
     unused grant funds.
       ``(j) Other Uses.--The National Board may use not more than 
     5 percent of the amounts made available for innovation 
     grants--
       ``(1) to provide assistance to interests described in 
     section 385C(b)(2)(A) to obtain certification of a Regional 
     Board;
       ``(2) to provide assistance for emergent innovative 
     opportunities that are not covered by existing regional 
     plans;
       ``(3) to provide technical assistance, research, 
     organizational support, and other capacity building 
     infrastructure to support existing Regional Boards;
       ``(4) to provide assistance for other entrepreneurial 
     opportunities to advance the goals of the program; or
       ``(5) to advance a more integrative rural policy framework 
     for the United States.
       ``(k) Transfers.--To ensure maximum use of funds provided 
     under this subtitle, the National Board may transfer not more 
     than 10 percent of the amount of funds made available between 
     planning grants and innovation grants.

     ``SEC. 385H. NATIONAL CONFERENCE ON RURAL AMERICA.

       ``(a) In General.--The President shall call and conduct a 
     National Conference on Rural America, which shall be held not 
     earlier than November 1, 2002, and not later than October 30, 
     2004.
       ``(b) Purpose.--The purpose of the Conference shall be to 
     bring together the resources of governmental agencies and the 
     private and nonprofit sectors to develop--
       ``(1) policy recommendations and integrative strategies for 
     addressing the unique challenges facing rural areas of the 
     United States; and
       ``(2) an implementation plan, with outcome-based 
     measurements, for addressing the challenges.
       ``(c) Composition.--
       ``(1) In general.--The Conference shall be comprised of--
       ``(A) representatives of organizations devoted to rural 
     development;
       ``(B) Members of Congress, including the chairman and 
     ranking member of each of the Committee on Agriculture of the 
     House of Representatives and the Committee on Agriculture, 
     Nutrition, and Forestry of the Senate;
       ``(C) representatives of the Department of Agriculture and 
     other Federal agencies;
       ``(D) State, local, and tribal elected officials and 
     representatives;
       ``(E) representatives of colleges and universities, State 
     and tribal extension services, and State rural development 
     councils; and
       ``(F) individuals with specialized knowledge of and 
     expertise in rural and community development, cooperative 
     business, agricultural credit, venture capital, health care, 
     and rural demography.
       ``(2) Selection.--Of the participants in the Conference 
     described in paragraph (1)--
       ``(A) \1/3\ of the members shall be selected by the 
     President;
       ``(B) \1/3\ of the members shall be selected by the 
     Chairman and the ranking member of the Committee on 
     Agriculture of the House of Representatives; and
       ``(C) \1/3\ of the members shall be selected by the 
     Chairman and the ranking member of the Committee on 
     Agriculture, Nutrition, and Forestry of the Senate.
       ``(3) Representation.--In selecting the participants of the 
     Conference, the President and the Chairman of each Committee 
     referred to in paragraph (2) shall ensure, to the maximum 
     extent practicable, that the participants are representative 
     of the ethnic, racial, and linguistic diversity of rural 
     areas of the United States.
       ``(d) Report.--
       ``(1) Report to president.--Not later than 120 days after 
     the termination of the Conference, the Conference shall 
     submit to the President a report that contains the findings 
     and recommendations of the Conference, including findings and 
     recommendations to address needs related to--
       ``(A) telecommunications;
       ``(B) rural health issues;
       ``(C) transportation;
       ``(D) opportunities for economic diversification and 
     innovation within rural America, with particular attention to 
     entrepreneurial support and innovation;
       ``(E) the current and future human resource capacity of 
     rural America;
       ``(F) access to market-based financing and venture and 
     equity capital in rural America; and
       ``(G) the development of innovative public and private 
     collaborations for investments in rural America.
       ``(2) Report made public and to congress.--Not later than 
     90 days after receipt by the President, the President shall--
       ``(A) make the report public; and
       ``(B) transmit to the Committee on Agriculture of the House 
     of Representatives and the Committee on Agriculture, 
     Nutrition, and Forestry of the Senate a copy of the report 
     and a statement of the President containing recommendations 
     for implementing the report.
       ``(3) Publication and distribution.--
       ``(A) In general.--The Conference shall publish and 
     distribute the report described in paragraph (1).
       ``(B) Mandatory distribution.--The Conference shall provide 
     a copy of a report published under subparagraph (A), at no 
     cost, to--
       ``(i) each Federal depository library; and
       ``(ii) on request, each State, tribal, and local elected 
     official in a rural area of the United States.
       ``(e) Funding.--Not later than 180 days after the 
     establishment of the National Board, the National Board shall 
     transfer not more than $2,000,000 to the Office of the 
     President to carry out this section, to remain available 
     until expended.''.

     SEC. 6031. FUNDING OF PENDING RURAL DEVELOPMENT LOAN AND 
                   GRANT APPLICATIONS.

       (a) Definition of Application.--In this section, the term 
     ``application'' does not include an application for a loan or 
     grant that, as of the date of enactment of this Act, is in 
     the preapplication phase of consideration under regulations 
     of the Secretary of Agriculture in effect on the date of 
     enactment of this Act.
       (b) Use of Funds.--Subject to subsection (c), the Secretary 
     of Agriculture shall use funds made available under 
     subsection (d) to provide funds for applications that are 
     pending on the date of enactment of this Act for--
       (1) water or waste disposal grants or direct loans under 
     paragraph (1) or (2) of section 306(a) of the Consolidated 
     Farm and Rural Development Act (7 U.S.C. 1926(a)); and
       (2) emergency community water assistance grants under 
     section 306A of that Act (7 U.S.C. 1926a).
       (c) Limitations.--
       (1) Appropriated amounts.--Funds made available under this 
     section shall be available to the Secretary to provide funds 
     for applications for loans and grants described in subsection 
     (b) that are pending on the date of enactment of this Act 
     only to the extent that funds for the loans and grants 
     appropriated in the annual appropriations Act for fiscal year 
     2002 have been exhausted.
       (2) Program requirements.--The Secretary may use funds made 
     available under this section

[[Page H1868]]

     to provide funds for a pending application for a loan or 
     grant described in subsection (b) only if the Secretary 
     processes, reviews, and approves the application in 
     accordance with regulations in effect on the date of 
     enactment of this Act.
       (3) Priority.--In providing funding under this section for 
     pending applications for loans or grants described in 
     subsection (b), the Secretary shall provide funding in the 
     following order of priority (until funds made available under 
     this section are exhausted):
       (A) Pending applications for water systems.
       (B) Pending applications for waste disposal systems.
       (d) Funding.--Notwithstanding any other provision of law, 
     of the funds of the Commodity Credit Corporation, the 
     Secretary shall use $360,000,000 to carry out this section, 
     to remain available until expended.
             Subtitle B--Rural Electrification Act of 1936

     SEC. 6101. GUARANTEES FOR BONDS AND NOTES ISSUED FOR 
                   ELECTRIFICATION OR TELEPHONE PURPOSES.

       (a) In General.--The Rural Electrification Act of 1936 is 
     amended by inserting after section 313 (7 U.S.C. 940c) the 
     following:

     ``SEC. 313A. GUARANTEES FOR BONDS AND NOTES ISSUED FOR 
                   ELECTRIFICATION OR TELEPHONE PURPOSES.

       ``(a) In General.--Subject to subsection (b), the Secretary 
     shall guarantee payments on bonds or notes issued by 
     cooperative or other lenders organized on a not-for-profit 
     basis if the proceeds of the bonds or notes are used to make 
     loans for any electrification or telephone purpose eligible 
     for assistance under this Act, including section 4 or 201 or 
     to refinance bonds or notes issued for such purposes.
       ``(b) Limitations.--
       ``(1) Outstanding loans.--A lender shall not receive a 
     guarantee under this section for a bond or note if, at the 
     time of the guarantee, the total principal amount of such 
     guaranteed bonds or notes outstanding of the lender would 
     exceed the principal amount of outstanding loans of the 
     lender for electrification or telephone purposes that have 
     been made concurrently with loans approved for such purposes 
     under this Act.
       ``(2) Generation of electricity.--The Secretary shall not 
     guarantee payment on a bond or note issued by a lender, the 
     proceeds of which are used for the generation of electricity.
       ``(3) Qualifications.--The Secretary may deny the request 
     of a lender for the guarantee of a bond or note under this 
     section if the Secretary determines that--
       ``(A) the lender does not have appropriate expertise or 
     experience or is otherwise not qualified to make loans for 
     electrification or telephone purposes;
       ``(B) the bond or note issued by the lender would not be 
     investment grade quality without a guarantee; or
       ``(C) the lender has not provided to the Secretary a list 
     of loan amounts approved by the lender that the lender 
     certifies are for eligible purposes described in subsection 
     (a).
       ``(4) Interest rate reduction.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     a lender may not use any amount obtained from the reduction 
     in funding costs as a result of the guarantee of a bond or 
     note under this section to reduce the interest rate on a new 
     or outstanding loan.
       ``(B) Concurrent loans.--A lender may use any amount 
     described in subparagraph (A) to reduce the interest rate on 
     a loan if the loan is--
       ``(i) made by the lender for electrification or telephone 
     projects that are eligible for assistance under this Act; and
       ``(ii) made concurrently with a loan approved by the 
     Secretary under this Act for such a project, as provided in 
     section 307.
       ``(c) Fees.--
       ``(1) In general.--A lender that receives a guarantee 
     issued under this section on a bond or note shall pay a fee 
     to the Secretary.
       ``(2) Amount.--The amount of an annual fee paid for the 
     guarantee of a bond or note under this section shall be equal 
     to 30 basis points of the amount of the unpaid principal of 
     the bond or note guaranteed under this section.
       ``(3) Payment.--A lender shall pay the fees required under 
     this subsection on a semiannual basis.
       ``(4) Rural economic development subaccount.--Subject to 
     subsection (e)(2), fees collected under this subsection shall 
     be--
       ``(A) deposited into the rural economic development 
     subaccount maintained under section 313(b)(2)(A), to remain 
     available until expended; and
       ``(B) used for the purposes described in section 
     313(b)(2)(B).
       ``(d) Guarantees.--
       ``(1) In general.--A guarantee issued under this section 
     shall--
       ``(A) be for the full amount of a bond or note, including 
     the amount of principal, interest, and call premiums;
       ``(B) be fully assignable and transferable; and
       ``(C) represent the full faith and credit of the United 
     States.
       ``(2) Limitation.--To ensure that the Secretary has the 
     resources necessary to properly examine the proposed 
     guarantees, the Secretary may limit the number of guarantees 
     issued under this section to 5 per year.
       ``(3) Department opinion.--On the timely request of a 
     lender, the General Counsel of the Department of Agriculture 
     shall provide the Secretary with an opinion regarding the 
     validity and authority of a guarantee issued to the lender 
     under this section.
       ``(e) Authorization of Appropriations.--
       ``(1) In general.--There are authorized to be appropriated 
     such sums as are necessary to carry out this section.
       ``(2) Fees.--To the extent that the amount of funds 
     appropriated for a fiscal year under paragraph (1) are not 
     sufficient to carry out this section, the Secretary may use 
     up to \1/3\ of the fees collected under subsection (c) for 
     the cost of providing guarantees of bonds and notes under 
     this section before depositing the remainder of the fees into 
     the rural economic development subaccount maintained under 
     section 313(b)(2)(A).
       ``(f) Termination.--The authority provided under this 
     section shall terminate on September 30, 2007.''.
       (b) Administration.--
       (1) Regulations.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of Agriculture shall 
     promulgate regulations to carry out the amendments made by 
     this section.
       (2) Implementation.--Not later than 240 days after the date 
     of enactment of this Act, the Secretary shall implement the 
     amendment made by this section.

     SEC. 6102. EXPANSION OF 911 ACCESS.

       Title III of the Rural Electrification Act of 1936 (7 
     U.S.C. 931 et seq.) is amended by adding at the end the 
     following:

     ``SEC. 315. EXPANSION OF 911 ACCESS.

       ``(a) In General.--Subject to such terms and conditions as 
     the Secretary may prescribe, the Secretary may make telephone 
     loans under this title to borrowers of loans made by the 
     Rural Utilities Service, State or local governments, Indian 
     tribes (as defined in section 4 of the Indian Self-
     Determination and Education Assistance Act (25 U.S.C. 450b)), 
     or other public entities for facilities and equipment to 
     expand or improve 911 access and integrated emergency 
     communications systems in rural areas.
       ``(b) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this section for each of fiscal years 2002 through 
     2007.''.

     SEC. 6103. ENHANCEMENT OF ACCESS TO BROADBAND SERVICE IN 
                   RURAL AREAS.

       (a) In General.--The Rural Electrification Act of 1936 (7 
     U.S.C. 901 et seq.) is amended by adding at the end the 
     following:
                   ``TITLE VI--RURAL BROADBAND ACCESS

     ``SEC. 601. ACCESS TO BROADBAND TELECOMMUNICATIONS SERVICES 
                   IN RURAL AREAS.

       ``(a) Purpose.--The purpose of this section is to provide 
     loans and loan guarantees to provide funds for the costs of 
     the construction, improvement, and acquisition of facilities 
     and equipment for broadband service in eligible rural 
     communities.
       ``(b) Definitions.--In this section:
       ``(1) Broadband service.--The term `broadband service' 
     means any technology identified by the Secretary as having 
     the capacity to transmit data to enable a subscriber to the 
     service to originate and receive high-quality voice, data, 
     graphics, and video.
       ``(2) Eligible rural community.--The term `eligible rural 
     community' means any incorporated or unincorporated place 
     that--
       ``(A) has not more than 20,000 inhabitants, based on the 
     most recent available population statistics of the Bureau of 
     the Census; and
       ``(B) is not located in an area designated as a standard 
     metropolitan statistical area.
       ``(c) Loans and Loan Guarantees.--
       ``(1) In general.--The Secretary shall make or guarantee 
     loans to eligible entities described in subsection (d) to 
     provide funds for the construction, improvement, or 
     acquisition of facilities and equipment for the provision of 
     broadband service in eligible rural communities.
       ``(2) Priority.--In making or guaranteeing loans under 
     paragraph (1), the Secretary shall give priority to eligible 
     rural communities in which broadband service is not available 
     to residential customers.
       ``(d) Eligible Entities.--
       ``(1) In general.--To be eligible to obtain a loan or loan 
     guarantee under this section, an entity shall--
       ``(A) have the ability to furnish, improve, or extend a 
     broadband service to an eligible rural community; and
       ``(B) submit to the Secretary a proposal for a project that 
     meets the requirements of this section.
       ``(2) State and local governments.--A State or local 
     government (including any agency, subdivision, or 
     instrumentality thereof (including consortia thereof)) shall 
     be eligible for a loan or loan guarantee under this section 
     to provide broadband services to an eligible rural community 
     only if, not later than 90 days after the Administrator has 
     promulgated regulations to carry out this section, no other 
     eligible entity is already offering, or has committed to 
     offer, broadband services to the eligible rural community.
       ``(3) Subscriber lines.--An entity shall not be eligible to 
     obtain a loan or loan guarantee under this section if the 
     entity serves more than 2 percent of the telephone subscriber 
     lines installed in the aggregate in the United States.
       ``(e) Broadband Service.--The Secretary shall, from time to 
     time as advances in technology warrant, review and recommend 
     modifications of rate-of-data transmission criteria for 
     purposes of the identification of broadband service 
     technologies under subsection (b)(1).
       ``(f) Technological Neutrality.--For purposes of 
     determining whether or not to make a loan or loan guarantee 
     for a project under this section, the Secretary shall use 
     criteria that are technologically neutral.
       ``(g) Terms and Conditions for Loans and Loan Guarantees.--
     Notwithstanding any other provision of law, a loan or loan 
     guarantee under subsection (c) shall--
       ``(1) bear interest at an annual rate of, as determined by 
     the Secretary--
       ``(A) in the case of a direct loan--
       ``(i) the cost of borrowing to the Department of the 
     Treasury for obligations of comparable maturity; or
       ``(ii) 4 percent; and
       ``(B) in the case of a guaranteed loan, the current 
     applicable market rate for a loan of comparable maturity; and

[[Page H1869]]

       ``(2) have a term not to exceed the useful life of the 
     assets constructed, improved, or acquired with the proceeds 
     of the loan or extension of credit.
       ``(h) Use of Loan Proceeds to Refinance Loans for 
     Deployment of Broadband Service.--Notwithstanding any other 
     provision of this Act, the proceeds of any loan made or 
     guaranteed by the Secretary under this Act may be used by the 
     recipient of the loan for the purpose of refinancing an 
     outstanding obligation of the recipient on another 
     telecommunications loan made under this Act if the use of the 
     proceeds for that purpose will further the construction, 
     improvement, or acquisition of facilities and equipment for 
     the provision of broadband service in eligible rural 
     communities.
       ``(i) Reports.--Not later than 1 year after the date of 
     enactment of this section, and biennially thereafter, the 
     Administrator shall submit to Congress a report that--
       ``(1) describes how the Administrator determines under 
     subsection (a)(1) that a service enables a subscriber to 
     originate and receive high-quality voice, data, graphics, and 
     video; and
       ``(2) provides a detailed list of services that have been 
     granted assistance under this section.
       ``(j) Funding.--
       ``(1) In general.--Notwithstanding any other provision of 
     law, of the funds of the Commodity Credit Corporation, the 
     Secretary shall make available to carry out this section--
       ``(A) $20,000,000 for each of fiscal years 2002 through 
     2005, to remain available until expended; and
       ``(B) $10,000,000 for each of fiscal years 2006 and 2007, 
     to remain available until expended.
       ``(2) Television funds.--
       ``(A) In general.--The Secretary shall be entitled to 
     receive, shall accept, and shall use to carry out this 
     section, without further appropriation any funds made 
     available under section 1011(a)(2)(B) of the Launching Our 
     Communities' Access to Local Television Act of 2000 (47 
     U.S.C. 1109(a)(2)(B)).
       ``(B) Use of television funds.--The Secretary shall use any 
     funds received under subparagraph (A) in equal amounts for 
     each remaining fiscal year on receipt of the funds (including 
     the fiscal year of receipt) through fiscal year 2007.
       ``(3) Authorization of appropriations.--In addition to 
     funds otherwise made available under this subsection, there 
     are authorized to be appropriated such sums as necessary to 
     carry out this section for each of fiscal years 2003 through 
     2007.
       ``(4) Allocation of funds.--
       ``(A) In general.--From amounts made available for each 
     fiscal year under this subsection, the Secretary shall--
       ``(i) establish a national reserve for loans and loan 
     guarantees to eligible entities in States under this section; 
     and
       ``(ii) allocate amounts in the reserve to each State for 
     each fiscal year for loans and loan guarantees to eligible 
     entities in the State.
       ``(B) Amount.--The amount of an allocation made to a State 
     for a fiscal year under subparagraph (A) shall bear the same 
     ratio to the amount of allocations made for all States for 
     the fiscal year as the number of communities with a 
     population of 2,500 inhabitants or less in the State bears to 
     the number of communities with a population of 2,500 
     inhabitants or less in all States, as determined on the basis 
     of the latest available census.
       ``(C) Unobligated amounts.--Any amounts in the reserve 
     established for a State for a fiscal year under subparagraph 
     (B) that are not obligated by April 1 of the fiscal year 
     shall be available to the Secretary to make loans and loan 
     guarantees under this section to eligible entities in any 
     State, as determined by the Secretary.
       ``(k) Termination of Authority.--No loan or loan guarantee 
     may be made under this section after September 30, 2007.''.
       (b) Regulations.--
       (1) In general.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of Agriculture shall 
     promulgate such regulations as are necessary to implement the 
     amendment made by subsection (a).
       (2) Procedure.--The promulgation of the regulations shall 
     be made without regard to--
       (A) the notice and comment provisions of section 553 of 
     title 5, United States Code;
       (B) the Statement of Policy of the Secretary of Agriculture 
     effective July 24, 1971 (36 Fed. Reg. 13804), relating to 
     notices of proposed rulemaking and public participation in 
     rulemaking; and
       (C) chapter 35 of title 44, United States Code (commonly 
     known as the ``Paperwork Reduction Act'').
       (3) Congressional review of agency rulemaking.--In carrying 
     out this subsection, the Secretary shall use the authority 
     provided under section 808 of title 5, United States Code.
   Subtitle C--Food, Agriculture, Conservation, and Trade Act of 1990

     SEC. 6201. ALTERNATIVE AGRICULTURAL RESEARCH AND 
                   COMMERCIALIZATION CORPORATION.

       (a) Repeal of Corporation Authorization.--Subtitle G of 
     title XVI of the Food, Agriculture, Conservation, and Trade 
     Act of 1990 (7 U.S.C. 5901 et seq.) is repealed.
       (b) Disposition of Assets.--On the date of enactment of 
     this Act--
       (1) the assets, both tangible and intangible, of the 
     Alternative Agricultural Research and Commercialization 
     Corporation (referred to in this section as the 
     ``Corporation''), including the funds in the Alternative 
     Agricultural Research and Commercialization Revolving Fund as 
     of the date of enactment of this Act, are transferred to the 
     Secretary of Agriculture; and
       (2) notwithstanding the Federal Property and Administrative 
     Services Act of 1949 (40 U.S.C. 471 et seq.) and any other 
     law that prescribes procedures for procurement, use, and 
     disposal of property by a Federal agency, the Secretary shall 
     have authority to manage and dispose of the assets 
     transferred under paragraph (1) in a manner that, to the 
     maximum extent practicable, provides the best value to the 
     Federal Government.
       (c) Use of Assets.--
       (1) In general.--Funds transferred under subsection (b), 
     and any income from assets or proceeds from the sale of 
     assets transferred under subsection (b), shall be deposited 
     in an account in the Treasury, and shall remain available to 
     the Secretary until expended, without further appropriation, 
     to pay--
       (A) any claims against, or obligations of, the Corporation; 
     and
       (B) the costs incurred by the Secretary in carrying out 
     this section.
       (2) Final disposition.--On final disposition of all assets 
     transferred under subsection (b), any funds remaining in the 
     account described in paragraph (1) shall be transferred into 
     miscellaneous receipts in the Treasury.
       (d) Conforming Amendments.--
       (1) Section 5315 of title 5, United States Code, is amended 
     by striking ``Executive Director of the Alternative 
     Agricultural Research and Commercialization Corporation''.
       (2) Section 730 of the Federal Agriculture Improvement and 
     Reform Act of 1996 (7 U.S.C. 5902 note; Public Law 104-127) 
     is repealed.
       (3) Section 211(b) of the Department of Agriculture 
     Reorganization Act of 1994 (7 U.S.C. 6911(b)) is amended by 
     striking paragraph (5).
       (4) Section 404(d) of the Agricultural Research, Extension, 
     and Education Reform Act of 1998 (7 U.S.C. 7624(d)) is 
     amended--
       (A) by striking paragraph (2); and
       (B) by redesignating paragraphs (3) and (4) as paragraphs 
     (2) and (3), respectively.
       (5) The Herger-Feinstein Quincy Library Group Forest 
     Recovery Act (16 U.S.C. 2104; Public Law 105-277; 112 Stat. 
     2681-305) is amended by striking subsection (m).
       (6) Section 9101(3) of title 31, United States Code, is 
     amended by striking subparagraph (Q).

     SEC. 6202. RURAL ELECTRONIC COMMERCE EXTENSION PROGRAM.

       Subtitle H of title XVI of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 is amended by inserting 
     after section 1669 (7 U.S.C. 5922) the following:

     ``SEC. 1670. RURAL ELECTRONIC COMMERCE EXTENSION PROGRAM.

       ``(a) Definitions.--In this section:
       ``(1) Development center.--The term `development center' 
     means--
       ``(A) the North Central Regional Center for Rural 
     Development;
       ``(B) the Northeast Regional Center for Rural Development 
     or its designee;
       ``(C) the Southern Rural Development Center; and
       ``(D) the Western Rural Development Center or its designee.
       ``(2) Extension program.--The term `extension program' 
     means the rural electronic commerce extension program 
     established under subsection (b).
       ``(3) Microenterprise.--The term `microenterprise' means a 
     commercial enterprise that has 5 or fewer employees, 1 or 
     more of whom own the enterprise.
       ``(4) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture, acting through the Administrator of the 
     Cooperative State Research, Education, and Extension Service.
       ``(5) Small business.--The term `small business' has the 
     meaning given the term `small-business concern' by section 
     3(a) of the Small Business Act (15 U.S.C. 632(a)).
       ``(b) Establishment.--The Secretary shall establish a rural 
     electronic commerce extension program to expand and enhance 
     electronic commerce practices and technology to be used by 
     small businesses and microenterprises in rural areas.
       ``(c) Grants.--
       ``(1) In general.--The Secretary shall carry out the 
     program established under subsection (b) by making--
       ``(A) grants to each of the development centers; and
       ``(B) competitive grants to land-grant colleges and 
     universities (or consortia of land-grant colleges and 
     universities) and to colleges and universities (including 
     community colleges) with agricultural or rural development 
     programs--
       ``(i) to develop and facilitate innovative rural electronic 
     commerce business strategies; and
       ``(ii) to assist small businesses and microenterprises in 
     identifying, adapting, implementing, and using electronic 
     commerce business practices and technologies.
       ``(2) Eligibility.--The selection criteria established for 
     grants awarded under paragraph (1)(B) shall include--
       ``(A) the ability of an applicant to provide training and 
     education on best practices, technology transfer, adoption, 
     and use of electronic commerce in rural communities by small 
     businesses and microenterprises;
       ``(B) the extent and geographic diversity of the area 
     served by the proposed project or activity under the 
     extension program;
       ``(C) in the case of a land-grant college or university, 
     the extent of participation of the land-grant college or 
     university in the extension program (including any economic 
     benefits that would result from that participation);
       ``(D) the percentage of funding and in-kind commitments 
     from non-Federal sources that would be needed by and 
     available for a proposed project or activity under the 
     extension program; and
       ``(E) the extent of participation of low-income and 
     minority businesses or microenterprises in a proposed project 
     or activity under the extension program.
       ``(3) Non-federal share.--
       ``(A) In general.--As a condition of the receipt of funds 
     under this section, a development

[[Page H1870]]

     center or grant applicant shall agree to obtain from non-
     Federal sources (including State, local, nonprofit, or 
     private sector sources) contributions of an amount equal to 
     50 percent of the grant amount.
       ``(B) Form.--The non-Federal share required under 
     subparagraph (A) may be provided in the form of in-kind 
     contributions.
       ``(C) Exception.--The non-Federal share required under 
     subparagraph (A) may be reduced to 25 percent if the grant 
     recipient serves low-income or minority-owned businesses or 
     microenterprises, as determined by the Secretary.
       ``(d) Report.--Not later than 2 years after the date of 
     enactment of this section, the Secretary shall submit to the 
     Committee on Agriculture of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate a report that describes--
       ``(1) the policies, practices, and procedures used to 
     assist rural communities in efforts to adopt and use 
     electronic commerce techniques; and
       ``(e) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $60,000,000 for 
     each of fiscal years 2002 through 2007, of which not less 
     than \1/3\ of the amount made available for each fiscal year 
     shall be used to carry out activities under subsection 
     (c)(1)(A).''.

     SEC. 6203. TELEMEDICINE AND DISTANCE LEARNING SERVICES IN 
                   RURAL AREAS.

       (a) In General.--Section 2335A of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 950aaa-5) is 
     amended by striking ``2002'' and inserting ``2007''.
       (b) Conforming Amendment.--Section 1(b) of Public Law 102-
     551 (7 U.S.C. 950aaa note) is amended by striking ``1997'' 
     and inserting ``2007''.
            Subtitle D--SEARCH Grants for Small Communities

     SEC. 6301. DEFINITIONS.

       In this subtitle:
       (1) Council.--The term ``council'' means an independent 
     citizens' council established by a State rural development 
     director under section 6302(c).
       (2) Environmental project.--
       (A) In general.--The term ``environmental project'' means a 
     project that--
       (i) improves environmental quality; and
       (ii) is necessary to comply with an applicable 
     environmental law (including a regulation).
       (B) Inclusion.--The term ``environmental project'' includes 
     an initial feasibility study of a project.
       (3) Region.--The term ``region'' means a geographic area of 
     a State, as determined by the State rural development 
     director, in coordination with the environmental protection 
     director of the State.
       (4) SEARCH grant.--The term ``SEARCH grant'' means a grant 
     awarded under section 6302(f).
       (5) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (6) Small community.--The term ``small community'' means an 
     incorporated or unincorporated rural community with a 
     population of 2,500 inhabitants or less.
       (7) State.--The term ``State'' has the meaning given the 
     term in section 381A of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 2009).

     SEC. 6302. SEARCH GRANT PROGRAM.

       (a) In General.--The Secretary, in coordination with the 
     Administrator of the Environmental Protection Agency, may 
     establish the SEARCH grant program.
       (b) Allocation to State Rural Development Directors.--
       (1) In general.--Subject to paragraph (2) and section 
     6304(a)(2), not later than 60 days after the date on which 
     the Director of the Office of Management and Budget 
     apportions any amounts made available under this subtitle for 
     any of fiscal years 2002 through 2007, the Secretary, on 
     request of a State rural development director (in 
     coordination with the environmental protection director of 
     the State), shall allocate to the State rural development 
     director an amount not to exceed $1,000,000, to be used by 
     the State rural development director to award SEARCH grants 
     under subsection (d).
       (2) Grants to states.--The total amount of funds allocated 
     to State rural development directors in all States other than 
     Alaska, Hawaii, or the 48 contiguous States for a fiscal year 
     under this subsection shall not exceed $1,000,000.
       (c) Independent Citizens' Council.--
       (1) Establishment.--The State rural development director of 
     a State shall establish an independent citizens' council to 
     carry out the duties described in this section.
       (2) Composition.--
       (A) In general.--A council shall be composed of 9 members, 
     appointed by the State rural development director, in 
     coordination with the environmental protection director of 
     the State.
       (B) Representation; residence.--Each member of a council 
     shall--
       (i) represent an individual region of the State, as 
     determined by the State rural development director; and
       (ii) reside in a small community in the State.
       (d) Eligibility.--A SEARCH grant shall be awarded under 
     this section only to a small community for 1 or more 
     environmental projects for which the small community--
       (1) needs funds to carry out initial feasibility or 
     environmental studies as required by Federal or State law 
     before applying to traditional funding sources; and
       (2) demonstrates that the small community has been unable 
     to obtain sufficient funding from traditional funding 
     sources.
       (e) Applications.--To be eligible to receive a SEARCH 
     grant, a small community in a State shall submit to the State 
     rural development director of the State an application that 
     includes--
       (1) a description of the proposed environmental project 
     (including an explanation of how the project would assist the 
     small community in complying with a Federal or State 
     environmental law (including a regulation);
       (2) an explanation of why the project is important to the 
     small community;
       (3) a description of all actions taken with respect to the 
     project as of the date of the application, including any 
     attempt to secure funding; and
       (4) a description of demonstrated need for funding for the 
     project.
       (f) Awards.--
       (1) In general.--Not later than May 1 of each fiscal year, 
     a State rural development director, in coordination with the 
     council and the environmental protection director of the 
     State, shall--
       (A) review all applications received by the State rural 
     development director under subsection (e); and
       (B) award SEARCH grants to small communities based on--
       (i) an evaluation of whether the proposed project meets the 
     eligibility criteria under subsection (d); and
       (ii) the content of the application.
       (2) Administration.--In awarding a SEARCH grant, a State 
     rural development director--
       (A) shall award the funds for any recommended environmental 
     project in a timely and expeditious manner; and
       (B) shall not award a SEARCH grant to a grantee or project 
     in violation of any Federal or State law (including a 
     regulation).
       (3) Matching requirement.--A small community that receives 
     a SEARCH grant under this section may be required to provide 
     matching funds.
       (g) Unexpended Funds.--
       (1) In general.--If, for any fiscal year, any unexpended 
     funds remain after SEARCH grants are awarded by a State rural 
     development director under subsection (f), the State rural 
     development director, in coordination with the environmental 
     protection director of the State, may repeat the application 
     and review process so that any remaining funds are 
     recommended for award, and awarded, not later than July 30 of 
     the fiscal year.
       (2) Retention of funds.--
       (A) In general.--Any unexpended funds that are not awarded 
     under subsection (f) or paragraph (1) shall be retained by 
     the State rural development director for award during the 
     following fiscal year.
       (B) Limitation.--A State SEARCH account that accumulates a 
     balance of unexpended funds described in subparagraph (A) in 
     excess of $2,000,000 shall be ineligible to receive 
     additional funds for SEARCH grants until such time as the 
     State rural development director awards grants in the amount 
     of the excess.

     SEC. 6303. REPORT.

       Not later than 30 days after the end of the first fiscal 
     year for which SEARCH grants are awarded, and annually 
     thereafter, the Secretary shall submit to the Committee on 
     Energy and Commerce and the Committee on Agriculture of the 
     House of Representatives and the Committee on Agriculture, 
     Nutrition, and Forestry of the Senate a report that--
       (1) describes the number of SEARCH grants awarded during 
     the fiscal year;
       (2) identifies each small community that received a SEARCH 
     grant during the fiscal year;
       (3) describes the project or purpose for which each SEARCH 
     grant was awarded, including a statement of the benefit to 
     public health or the environment of the environmental project 
     receiving the grant funds; and
       (4) describes the status of each project or portion of a 
     project for which a SEARCH grant was awarded, including a 
     project or portion of a project for which a SEARCH grant was 
     awarded for any previous fiscal year.

     SEC. 6304. FUNDING.

       (a) Allocation to State Rural Development Directors.--
       (1) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out section 6302(b) $51,000,000 
     for each of fiscal years 2002 through 2007, of which not to 
     exceed $1,000,000 shall be used to make grants under section 
     6302(b)(2).
       (2) Actual appropriation.--If funds to carry out section 
     6302(b) are made available for a fiscal year in an amount 
     that is less than the amount authorized under paragraph (1) 
     for the fiscal year, the Secretary shall divide the 
     appropriated funds for the fiscal year equally among the 50 
     States.
       (b) Other Expenses.--There are authorized to be 
     appropriated such sums as are necessary to carry out this 
     subtitle (other than section 6302(b)).
                       Subtitle E--Miscellaneous

     SEC. 6401. VALUE-ADDED AGRICULTURAL PRODUCT MARKET 
                   DEVELOPMENT GRANTS.

       (a) In General.--Section 231 of the Agricultural Risk 
     Protection Act of 2000 (7 U.S.C. 1621 note; Public Law 106-
     224) is amended--
       (1) by redesignating subsections (b) through (d) as 
     subsections (c) through (e), respectively;
       (2) by striking subsection (a) and inserting the following:
       ``(a) Definition of Value-Added Agricultural Product.--
       ``(1) In general.--The term `value-added agricultural 
     product' means any agricultural commodity or product that--
       ``(A)(i) has undergone a change in physical state;
       ``(ii) was produced in a manner that enhances the value of 
     the agricultural commodity or product, as demonstrated 
     through a business plan that shows the enhanced value, as 
     determined by the Secretary; or

[[Page H1871]]

       ``(iii) is physically segregated in a manner that results 
     in the enhancement of the value of the agricultural commodity 
     or product; and
       ``(B) as a result of the change in physical state or the 
     manner in which the agricultural commodity or product was 
     produced or segregated--
       ``(i) the customer base for the agricultural commodity or 
     product has been expanded; and
       ``(ii) a greater portion of the revenue derived from the 
     marketing, processing, or physical segregation of the 
     agricultural commodity or product is available to the 
     producer of the commodity or product.
       ``(2) Inclusion.--The term `value-added agricultural 
     product' includes farm- or ranch-based renewable energy.
       ``(b) Grant Program.--
       ``(1) In general.--From amounts made available under 
     paragraph (4), the Secretary shall award competitive grants--
       ``(A) to an eligible independent producer (as determined by 
     the Secretary) of a value-added agricultural product to 
     assist the producer--
       ``(i) in developing a business plan for viable marketing 
     opportunities for the value-added agricultural product; or
       ``(ii) in developing strategies that are intended to create 
     marketing opportunities for the producer; and
       ``(B) to an eligible agricultural producer group, farmer or 
     rancher cooperative, or majority-controlled producer-based 
     business venture (as determined by the Secretary) to assist 
     the entity--
       ``(i) in developing a business plan for viable marketing 
     opportunities in emerging markets for a value-added 
     agricultural product; or
       ``(ii) in developing strategies that are intended to create 
     marketing opportunities in emerging markets for the value-
     added agricultural product.
       ``(2) Amount of grant.--
       ``(A) In general.--The total amount provided under this 
     subsection to a grant recipient shall not exceed $500,000.
       ``(B) Majority-controlled producer-based business 
     ventures.--The amount of grants provided to majority-
     controlled producer-based business ventures under paragraph 
     (1)(B) for a fiscal year may not exceed 10 percent of the 
     amount of funds that are used to make grants for the fiscal 
     year under this subsection.
       ``(3) Grantee strategies.--A grantee under paragraph (1) 
     shall use the grant--
       ``(A) to develop a business plan or perform a feasibility 
     study to establish a viable marketing opportunity for a 
     value-added agricultural product; or
       ``(B) to provide capital to establish alliances or business 
     ventures that allow the producer of the value-added 
     agricultural product to better compete in domestic or 
     international markets.
       ``(4) Funding.--Not later than 30 days after the date of 
     enactment of this paragraph, on October 1, 2002, and on each 
     October 1 thereafter through October 1, 2006, of the funds of 
     the Commodity Credit Corporation, the Secretary shall make 
     available to carry out this subsection $40,000,000, to remain 
     available until expended.'';
       (3) in subsection (c)(1) (as redesignated by paragraph 
     (1))--
       (A) by striking ``subsection (a)(2)'' and inserting 
     ``subsection (b)(2)'';
       (B) by striking ``$5,000,000'' and inserting ``5 percent''; 
     and
       (C) by striking ``subsection (a)'' and inserting 
     ``subsection (b)''; and
       (4) in subsection (d) (as redesignated by paragraph (1)), 
     by striking ``subsections (a) and (b)'' and inserting 
     ``subsections (b) and (c)''.
       (b) Applicability.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by subsection (a) apply beginning on October 
     1, 2002.
       (2) Funding.--Funds made available under section 
     231(b)(4)(A)(i) of the Agricultural Risk Protection Act of 
     2000 (as amended by subsection (a)(2)) shall be made 
     available not later than 30 days after the date of enactment 
     of this Act.

     SEC. 6402. AGRICULTURE INNOVATION CENTER DEMONSTRATION 
                   PROGRAM.

       (a) Purpose.--The purpose of this section is to direct the 
     Secretary of Agriculture to establish a demonstration program 
     under which agricultural producers are provided--
       (1) technical assistance, consisting of engineering 
     services, applied research, scale production, and similar 
     services, to enable the agricultural producers to establish 
     businesses to produce value-added agricultural commodities or 
     products;
       (2) assistance in marketing, market development, and 
     business planning; and
       (3) organizational, outreach, and development assistance to 
     increase the viability, growth, and sustainability of 
     businesses that produce value-added agricultural commodities 
     or products.
       (b) Definitions.--In this section:
       (1) Program.--The term ``Program'' means the Agriculture 
     Innovation Center Demonstration Program established under 
     subsection (c).
       (2) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (c) Establishment of Program.--The Secretary shall 
     establish a demonstration program, to be known as the 
     ``Agriculture Innovation Center Demonstration Program'' under 
     which the Secretary shall--
       (1) make grants to assist eligible entities in establishing 
     Agriculture Innovation Centers to enable agricultural 
     producers to obtain the assistance described in subsection 
     (a); and
       (2) provide assistance to eligible entities in establishing 
     Agriculture Innovation Centers through the research and 
     technical services of the Department of Agriculture.
       (d) Eligibility Requirements.--
       (1) In general.--An entity shall be eligible for a grant 
     and assistance described in subsection (c) to establish an 
     Agriculture Innovation Center if--
       (A) the entity--
       (i) has provided services similar to the services described 
     in subsection (a); or
       (ii) demonstrates the capability of providing such 
     services;
       (B) the application of the entity for the grant and 
     assistance includes a plan, in accordance with regulations 
     promulgated by the Secretary, that outlines--
       (i) the support for the entity in the agricultural 
     community;
       (ii) the technical and other expertise of the entity; and
       (iii) the goals of the entity for increasing and improving 
     the ability of local agricultural producers to develop 
     markets and processes for value-added agricultural 
     commodities or products;
       (C) the entity demonstrates that adequate resources (in 
     cash or in kind) are available, or have been committed to be 
     made available, to the entity, to increase and improve the 
     ability of local agricultural producers to develop markets 
     and processes for value-added agricultural commodities or 
     products; and
       (D) the Agriculture Innovation Center of the entity has a 
     board of directors established in accordance with paragraph 
     (2).
       (2) Board of directors.--Each Agriculture Innovation Center 
     of an eligible entity shall have a board of directors 
     composed of representatives of each of the following groups:
       (A) The 2 general agricultural organizations with the 
     greatest number of members in the State in which the eligible 
     entity is located.
       (B) The department of agriculture, or similar State 
     department or agency, of the State in which the eligible 
     entity is located.
       (C) Entities representing the 4 highest grossing 
     commodities produced in the State, determined on the basis of 
     annual gross cash sales.
       (e) Grants and Assistance.--
       (1) In general.--Subject to subsection (i), under the 
     Program, the Secretary shall make, on a competitive basis, 
     annual grants to eligible entities.
       (2) Maximum amount of grants.--A grant under paragraph (1) 
     shall be in an amount that does not exceed the lesser of--
       (A) $1,000,000; or
       (B) twice the dollar amount of the resources (in cash or in 
     kind) that the eligible entity demonstrates are available, or 
     have been committed to be made available, to the eligible 
     entity in accordance with subsection (d)(1)(C).
       (3) Maximum number of grants.--
       (A) First fiscal year of program.--In the first fiscal year 
     of the Program, the Secretary shall make grants to not more 
     than 5 eligible entities.
       (B) Second fiscal year of program.--In the second fiscal 
     year of the Program, the Secretary may make grants to--
       (i) the eligible entities to which grants were made under 
     subparagraph (A); and
       (ii) not more than 10 additional eligible entities.
       (4) State limitation.--
       (A) In general.--Subject to subparagraph (B), in the first 
     3 fiscal years of the Program, the Secretary shall not make a 
     grant under the Program to more than 1 entity in any 1 State.
       (B) Collaboration.--Nothing in subparagraph (A) precludes a 
     recipient of a grant under the Program from collaborating 
     with any other institution with respect to activities 
     conducted using the grant.
       (f) Use of Funds.--An eligible entity to which a grant is 
     made under the Program may use the grant only for the 
     following purposes (but only to the extent that the use is 
     not described in section 231(d) of the Agricultural Risk 
     Protection Act of 2000 (7 U.S.C. 1621 note; Public Law 106-
     224)):
       (1) Applied research.
       (2) Consulting services.
       (3) Hiring of employees, at the discretion of the board of 
     directors of the Agriculture Innovation Center of the 
     eligible entity.
       (4) The making of matching grants, each of which shall be 
     in an amount not to exceed $5,000, to agricultural producers, 
     except that the aggregate amount of all such matching grants 
     made by the eligible entity shall be not more than $50,000.
       (5) Legal services.
       (6) Any other related cost, as determined by the Secretary.
       (g) Research on Effects on the Agricultural Sector.--
       (1) In general.--Of the amount made available under 
     subsection (i) for each fiscal year, the Secretary shall use 
     $300,000 to support research at a university concerning the 
     effects of projects for value-added agricultural commodities 
     or products on agricultural producers and the commodity 
     markets.
       (2) Research elements.--Research under paragraph (1) shall 
     systematically examine, using linked, long-term, global 
     projections of the agricultural sector, the potential effects 
     of projects described in subparagraph (A) on--
       (A) demand for agricultural commodities;
       (B) market prices;
       (C) farm income; and
       (D) Federal outlays on commodity programs.
       (h) Report to Congress.--
       (1) In general.--Not later than 3 years after the date on 
     which the last of the first 10 grants is made under the 
     Program, the Secretary shall submit to the Committee on 
     Agriculture of the House of Representatives and the Committee 
     on Agriculture, Nutrition, and Forestry of the Senate a 
     report on--
       (A) the effectiveness of the Program in improving and 
     expanding the production of value-added agricultural 
     commodities or products; and
       (B) the effects of the Program on the economic viability of 
     agricultural producers.

[[Page H1872]]

       (2) Required elements.--The report under paragraph (1) 
     shall--
       (A) include a description of the best practices and 
     innovations found at each of the Agriculture Innovation 
     Centers established under the Program; and
       (B) specify the number and type of activities assisted, and 
     the type of assistance provided, under the Program.
       (i) Funding.--Of the amount made available under section 
     231(a)(1) of the Agricultural Risk Protection Act of 2000 (7 
     U.S.C. 1621 note; Public Law 106-224) for each fiscal year, 
     the Secretary shall use to carry out this section--
       (1) not less than $3,000,000 for fiscal year 2002; and
       (2) not less than $6,000,000 for each of fiscal years 2003 
     and 2004.

     SEC. 6403. FUND FOR RURAL AMERICA.

       (a) In General.--Section 793 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 2204f) is 
     repealed.
       (b) Conforming Amendment.--Section 2(b)(8)(B) of the 
     Competitive, Special, and Facilities Research Grant Act (7 
     U.S.C. 450i(b)(8)(B)) is amended in the second sentence by 
     striking ``smaller college or university (as described in 
     section 793(c)(2)(ii) of the Federal Agriculture Improvement 
     and Reform Act of 1996 (7 U.S.C. 2204f(c)(2)(ii))'' and 
     inserting ``college, university, or research foundation 
     maintained by a college or university that ranks in the 
     lowest \1/3\ of such colleges, universities, and research 
     foundations on the basis of Federal research funds 
     received''.

     SEC. 6404. RURAL LOCAL TELEVISION BROADCAST SIGNAL LOAN 
                   GUARANTEES.

       (a) In General.--Section 1011(a) of the Launching Our 
     Communities' Access to Local Television Act of 2000 (47 
     U.S.C. 1109(a)) is amended--
       (1) by striking ``For'' and inserting the following:
       ``(1) Authorization of appropriations.--For''; and
       (2) by adding at the end the following:
       ``(2) Commodity credit corporation funds.--
       ``(A) In general.--Notwithstanding any other provision of 
     law, subject to subparagraph (B), in addition to amounts made 
     available under paragraph (1), of the funds of the Commodity 
     Credit Corporation, the Secretary of Agriculture shall make 
     available for loan guarantees to carry out this title 
     $80,000,000 for the period beginning on the date of enactment 
     of this paragraph and ending on December 31, 2006, to remain 
     available until expended.
       ``(B) Broadband loans and loan guarantees.--
       ``(i) In general.--Amounts made available under 
     subparagraph (A) that are not obligated as of the release 
     date described in clause (ii) shall be available to the 
     Secretary to make loans and loan guarantees under section 601 
     of the Rural Electrification Act of 1936.
       ``(ii) Release date.--For purposes of clause (i), the 
     release date is the date that is the earlier of--

       ``(I) the date the Secretary determines that at least 75 
     percent of the designated market areas (as defined in section 
     122(j) of title 17, United States Code) not in the top 40 
     designated market areas described in section 1004(e)(1)(C)(i) 
     of the Launching Our Communities' Access to Local Television 
     Act of 2000 (47 U.S.C. 1103(e)(1)(C)(i)) have access to local 
     television broadcast signals for virtually all households (as 
     determined by the Secretary); or
       ``(II) December 31, 2006.

       ``(C) Advanced appropriations.--Subsections (c) and 
     (h)(1)(B) of section 1004 and section 1005(n)(3)(B) shall not 
     apply to amounts made available under this paragraph.''.
       (b) Technical and Conforming Amendments.--
       (1) Approval of loan guarantees.--Section 1004 of the 
     Launching Our Communities' Access to Local Television Act of 
     2000 (47 U.S.C. 1103) is amended--
       (A) in subsection (b)(1)--
       (i) by striking ``section 5'' and inserting ``section 
     1005''; and
       (ii) by striking ``section 11'' and inserting ``section 
     1011'';
       (B) in subsection (d)(1), by striking ``section 3'' and 
     inserting ``section 1003''; and
       (C) in the first sentence of subsection (h)(2)(D), by 
     striking ``section 5'' and inserting ``section 1005''.
       (2) Administration of loan guarantees.--Section 1005 of the 
     Launching Our Communities' Access to Local Television Act of 
     2000 (47 U.S.C. 1104) is amended--
       (A) in subsection (a), by striking ``sections 3 and 4'' and 
     inserting ``sections 1003 and 1004'';
       (B) in subsection (b)--
       (i) in paragraph (1)(D), by striking ``section 6(a)(2)'' 
     and inserting ``section 1006(a)(2)''; and
       (ii) in paragraph (3), by striking ``section 
     4(d)(3)(B)(iii)'' and inserting ``section 
     1004(d)(3)(B)(iii)''; and
       (C) in subsection (e)(3), by striking ``section 4(g)'' and 
     inserting ``section 1004(g)''.

     SEC. 6405. RURAL FIREFIGHTERS AND EMERGENCY PERSONNEL GRANT 
                   PROGRAM.

       (a) In General.--The Secretary of Agriculture may make 
     grants to units of general local government and Indian tribes 
     (as defined in section 4 of the Indian Self-Determination and 
     Education Assistance Act (25 U.S.C. 450b)) to pay the cost of 
     training firefighters and emergency medical personnel in 
     firefighting, emergency medical practices, and responding to 
     hazardous materials and bioagents in rural areas.
       (b) Use of Funds.--
       (1) Scholarships.--
       (A) In general.--Not less than 60 percent of the amounts 
     made available for competitively-awarded grants under this 
     section shall be used to provide grants to fund partial 
     scholarships for training of individuals at training centers 
     approved by the Secretary.
       (B) Priority.--In awarding grants under this paragraph, the 
     Secretary shall give priority to grant applicants that 
     provide for training within the region (or locality) of the 
     applicant.
       (2) Grants for training centers.--
       (A) In general.--A grant under subsection (a) may be used 
     to provide financial assistance to State and regional centers 
     that provide training for firefighters and emergency medical 
     personnel for improvements to the training facility, 
     equipment, curricula, and personnel.
       (B) Limitation.--Not more than $750,000 shall be provided 
     to any single training center for any fiscal year under this 
     paragraph.
       (c) Funding.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall make available to carry out 
     this section $10,000,000 for each of fiscal years 2003 
     through 2007, to remain available until expended.

     SEC. 6406. SENSE OF CONGRESS ON RURAL POLICY COORDINATION.

       It is the sense of Congress that the President should--
       (1) appoint a Special Assistant to the President for Rural 
     Policy;
       (2) designate within each Federal agency with jurisdiction 
     over rural programs or activities 1 or more senior officers 
     or employees to provide rural policy leadership for the 
     agency; and
       (3) create an intergovernmental rural policy working group 
     comprised of--
       (A) the Special Assistant to the President for Rural 
     Policy, who should serve as Chairperson; and
       (B) the senior officers and employees designated under 
     paragraph (2).
                TITLE VII--RESEARCH AND RELATED MATTERS
                         Subtitle A--Extensions

     SEC. 7101. NATIONAL RURAL INFORMATION CENTER CLEARINGHOUSE.

       Section 2381(e) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 3125b(e)) is amended by striking 
     ``2002'' and inserting ``2007''.

     SEC. 7102. GRANTS AND FELLOWSHIPS FOR FOOD AND AGRICULTURAL 
                   SCIENCES EDUCATION.

       Section 1417 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3152) is 
     amended--
       (1) in subsection (a)--
       (A) by striking ``and'' after ``economics,''; and
       (B) by inserting ``, and rural economic, community, and 
     business development'' before the period;
       (2) in subsection (b)--
       (A) in paragraph (1), by inserting ``, or in rural 
     economic, community, and business development'' before the 
     semicolon;
       (B) in paragraph (2), by inserting ``, or in rural 
     economic, community, and business development'' before the 
     semicolon;
       (C) in paragraph (3), by inserting ``, or teaching programs 
     emphasizing rural economic, community, and business 
     development'' before the semicolon;
       (D) in paragraph (4), by inserting ``, or programs 
     emphasizing rural economic, community, and business 
     development,'' after ``programs''; and
       (E) in paragraph (5), by inserting ``, or professionals in 
     rural economic, community, and business development'' before 
     the semicolon;
       (3) in subsection (d)--
       (A) in paragraph (1), by inserting ``, or in rural 
     economic, community, and business development,'' after 
     ``sciences''; and
       (B) in paragraph (2), by inserting ``, or in the rural 
     economic, community, and business development workforce,'' 
     after ``workforce''; and
       (4) in subsection (l), by striking ``2002'' and inserting 
     ``2007''.

     SEC. 7103. POLICY RESEARCH CENTERS.

       Section 1419A(d) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3155(d)) 
     is amended by striking ``2002'' and inserting ``2007''.

     SEC. 7104. HUMAN NUTRITION INTERVENTION AND HEALTH PROMOTION 
                   RESEARCH PROGRAM.

       Section 1424(d) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3174(d)) 
     is amended by striking ``2002'' and inserting ``2007''.

     SEC. 7105. PILOT RESEARCH PROGRAM TO COMBINE MEDICAL AND 
                   AGRICULTURAL RESEARCH.

       Section 1424A(d) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
     3174a(d)) is amended by striking ``2002'' and inserting 
     ``2007''.

     SEC. 7106. NUTRITION EDUCATION PROGRAM.

       Section 1425(c)(3) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
     3175(c)(3)) is amended by striking ``2002'' and inserting 
     ``2007''.

     SEC. 7107. CONTINUING ANIMAL HEALTH AND DISEASE RESEARCH 
                   PROGRAMS.

       Section 1433(a) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3195(a)) 
     is amended by striking ``2002'' and inserting ``2007''.

     SEC. 7108. APPROPRIATIONS FOR RESEARCH ON NATIONAL OR 
                   REGIONAL PROBLEMS.

       Section 1434(a) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3196(a)) 
     is amended by striking ``2002'' and inserting ``2007''.

     SEC. 7109. GRANTS TO UPGRADE AGRICULTURAL AND FOOD SCIENCES 
                   FACILITIES AT 1890 LAND-GRANT COLLEGES, 
                   INCLUDING TUSKEGEE UNIVERSITY.

       Section 1447(b) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
     3222b(b)) is amended by striking ``$15,000,000 for each of 
     fiscal years 1996 through 2002'' and inserting ``$25,000,000 
     for each of fiscal years 2002 through 2007''.

     SEC. 7110. NATIONAL RESEARCH AND TRAINING VIRTUAL CENTERS.

       (a) Authorization.--Section 1448 of the National 
     Agricultural Research, Extension, and

[[Page H1873]]

     Teaching Policy Act of 1977 (7 U.S.C. 3222c) is amended by 
     striking ``2002'' each place it appears in subsections (a)(1) 
     and (f) and inserting ``2007''.
       (b) Redesignation.--Section 1448 of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3222c) is amended--
       (1) in the section heading, by striking ``CENTENNIAL'' and 
     inserting ``VIRTUAL''; and
       (2) by striking ``centennial'' each place it appears and 
     inserting ``virtual''.

     SEC. 7111. HISPANIC-SERVING INSTITUTIONS.

       Section 1455(c) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3241(c)) 
     is amended by striking ``2002'' and inserting ``2007''.

     SEC. 7112. COMPETITIVE GRANTS FOR INTERNATIONAL AGRICULTURAL 
                   SCIENCE AND EDUCATION PROGRAMS.

       Section 1459A(c) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
     3292b(c)) is amended by striking ``2002'' and inserting 
     ``2007''.

     SEC. 7113. UNIVERSITY RESEARCH.

       Section 1463 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3311) is 
     amended--
       (1) in subsection (a), by striking ``$850,000,000 for each 
     of the fiscal years 1991 through 2002'' and inserting ``such 
     sums as may be necessary for each of fiscal years 1991 
     through 2007''; and
       (2) in subsection (b), by striking ``$310,000,000 for each 
     of the fiscal years 1991 through 2002'' and inserting ``such 
     sums as may be necessary for each of fiscal years 1991 
     through 2007''.

     SEC. 7114. EXTENSION SERVICE.

       Section 1464 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3312) is 
     amended by striking ``$420,000,000 for fiscal year 1991, 
     $430,000,000 for fiscal year 1992, $440,000,000 for fiscal 
     year 1993, $450,000,000 for fiscal year 1994, and 
     $460,000,000 for each of fiscal years 1995 through 2002'' and 
     inserting ``such sums as may be necessary for each of fiscal 
     years 1991 through 2007''.

     SEC. 7115. SUPPLEMENTAL AND ALTERNATIVE CROPS.

       Section 1473D(a) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
     3319d(a)) is amended by striking ``2002'' and inserting 
     ``2007''.

     SEC. 7116. AQUACULTURE RESEARCH FACILITIES.

       The first sentence of section 1477 of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3324) is amended by striking ``2002'' and 
     inserting ``2007''.

     SEC. 7117. RANGELAND RESEARCH.

       Section 1483(a) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3336(a)) 
     is amended by striking ``2002'' and inserting ``2007''.

     SEC. 7118. NATIONAL GENETICS RESOURCES PROGRAM.

       Section 1635(b) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5844(b)) is amended by striking 
     ``2002'' and inserting ``2007''.

     SEC. 7119. HIGH-PRIORITY RESEARCH AND EXTENSION INITIATIVES.

       Section 1672(h) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5925(h)) is amended by striking 
     ``2002'' and inserting ``2007.

     SEC. 7120. NUTRIENT MANAGEMENT RESEARCH AND EXTENSION 
                   INITIATIVE.

       Section 1672A(g) of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (7 U.S.C. 5925a(g)) is amended by 
     striking ``2002'' and inserting ``2007''.

     SEC. 7121. AGRICULTURAL TELECOMMUNICATIONS PROGRAM.

       Section 1673(h) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5926(h)) is amended by striking 
     ``2002'' and inserting ``2007''.

     SEC. 7122. ASSISTIVE TECHNOLOGY PROGRAM FOR FARMERS WITH 
                   DISABILITIES.

       Section 1680(c)(1) of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (7 U.S.C. 5933(c)(1)) is amended by 
     striking ``2002'' and inserting ``2007''.

     SEC. 7123. PARTNERSHIPS FOR HIGH-VALUE AGRICULTURAL PRODUCT 
                   QUALITY RESEARCH.

       Section 402(g) of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (7 U.S.C. 7622(g)) is amended by 
     striking ``2002'' and inserting ``2007''.

     SEC. 7124. BIOBASED PRODUCTS.

       (a) Pilot Project.--Section 404(e)(2) of the Agricultural 
     Research, Extension, and Education Reform Act of 1998 (7 
     U.S.C. 7624(e)(2)) is amended by striking ``2001'' and 
     inserting ``2007''.
       (b) Authorization of Appropriations.--Section 404(h) of 
     such Act (7 U.S.C. 7624(h)) is amended by striking ``2002'' 
     and inserting ``2007''.

     SEC. 7125. INTEGRATED RESEARCH, EDUCATION, AND EXTENSION 
                   COMPETITIVE GRANTS PROGRAM.

       Section 406 of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (7 U.S.C. 7626) is amended--
       (1) by redesignating subsection (e) as subsection (f);
       (2) by inserting after subsection (d) the following:
       ``(e) Term of Grant.--A grant under this section shall have 
     a term of not more than 5 years.''; and
       (3) in subsection (f) (as so redesignated), by striking 
     ``2002'' and inserting ``2007''.

     SEC. 7126. EQUITY IN EDUCATIONAL LAND-GRANT STATUS ACT OF 
                   1994.

       (f) Institutional Capacity Building Grants.--Section 535 of 
     the Equity in Educational Land-Grant Status Act of 1994 (7 
     U.S.C. 301 note; Public Law 103-382) is amended--
       (1) in subsection (b)(1), by striking ``2002'' and 
     inserting ``2007''; and
       (2) in subsection (c), by striking ``$1,700,000 for each of 
     fiscal years 1996 through 2002'' and inserting ``such sums as 
     are necessary for each of fiscal years 2002 through 2007''.

     SEC. 7127. 1994 INSTITUTION RESEARCH GRANTS.

       Section 536(c) of the Equity in Educational Land-Grant 
     Status Act of 1994 (7 U.S.C. 301 note) is amended by striking 
     ``2002'' and inserting ``2007''.

     SEC. 7128. ENDOWMENT FOR 1994 INSTITUTIONS.

       The first sentence of section 533(b) of the Equity in 
     Educational Land-Grant Status Act of 1994 (7 U.S.C. 301 note) 
     is amended by striking ``$4,600,000'' and all that follows 
     through the period and inserting ``such sums as are necessary 
     to carry out this section for each of fiscal years 1996 
     through 2007.''.

     SEC. 7129. PRECISION AGRICULTURE.

       Section 403(i) of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (7 U.S.C. 7623(i)) is amended by 
     striking ``2002'' and inserting ``2007''.

     SEC. 7130. THOMAS JEFFERSON INITIATIVE FOR CROP 
                   DIVERSIFICATION.

       Section 405(h) of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (7 U.S.C. 7625(h)) is amended by 
     striking ``2002'' and inserting ``2007''.

     SEC. 7131. SUPPORT FOR RESEARCH REGARDING DISEASES OF WHEAT, 
                   TRITICALE, AND BARLEY CAUSED BY FUSARIUM 
                   GRAMINEARUM OR BY TILLETIA INDICA.

       Section 408(e) of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (7 U.S.C. 7628(e)) is amended--
       (1) by striking ``$5,200,000'' and inserting ``such sums as 
     may be necessary''; and
       (2) by striking ``2002'' and inserting ``2007''.

     SEC. 7132. OFFICE OF PEST MANAGEMENT POLICY.

       Section 614(f) of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (7 U.S.C. 7653(f)) is amended by 
     striking ``2002'' and inserting ``2007''.

     SEC. 7133. NATIONAL AGRICULTURAL RESEARCH, EXTENSION, 
                   EDUCATION, AND ECONOMICS ADVISORY BOARD.

       Section 1408(h) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3123(h)) 
     is amended by striking ``2002'' and inserting ``2007''.

     SEC. 7134. GRANTS FOR RESEARCH ON PRODUCTION AND MARKETING OF 
                   ALCOHOLS AND INDUSTRIAL HYDROCARBONS FROM 
                   AGRICULTURAL COMMODITIES AND FOREST PRODUCTS.

       Section 1419(d) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3154(d)) 
     is amended by striking ``2002'' and inserting ``2007''.

     SEC. 7135. AGRICULTURAL EXPERIMENT STATIONS RESEARCH 
                   FACILITIES.

       Section 6(a) of the Research Facilities Act (7 U.S.C. 
     390d(a)) is amended by striking ``2002'' and inserting 
     ``2007''.

     SEC. 7136. COMPETITIVE, SPECIAL, AND FACILITIES RESEARCH 
                   GRANTS NATIONAL RESEARCH INITIATIVE.

       Section 2(b)(10) of the Competitive, Special, and 
     Facilities Research Grant Act (7 U.S.C. 450i(b)(10)) is 
     amended by striking ``2002'' and inserting ``2007''.

     SEC. 7137. FEDERAL AGRICULTURAL RESEARCH FACILITIES 
                   AUTHORIZATION OF APPROPRIATIONS.

       Section 1431 of the National Agricultural Research, 
     Extension, and Teaching Policy Act Amendments of 1985 (Public 
     Law 99-198; 99 Stat. 1556) is amended by striking ``2002'' 
     and inserting ``2007''.

     SEC. 7138. CRITICAL AGRICULTURAL MATERIALS RESEARCH.

       Section 16(a) of the Critical Agricultural Materials Act (7 
     U.S.C. 178n(a)) is amended by striking ``2002'' and inserting 
     ``2007''.

     SEC. 7139. AQUACULTURE.

       Section 10 of the National Aquaculture Act of 1980 (16 
     U.S.C. 2809) is amended by striking ``2002'' each place it 
     appears and inserting ``2007''.
                       Subtitle B--Modifications

     SEC. 7201. EQUITY IN EDUCATIONAL LAND-GRANT STATUS ACT OF 
                   1994.

       (a) Authorization of Appropriations.--Section 534(a)(1)(A) 
     of the Equity in Educational Land-Grant Status Act of 1994 (7 
     U.S.C. 301 note) is amended by striking ``$50,000'' and 
     inserting ``$100,000''.
       (b) Change of Indian Student Count Formula.--Section 
     533(c)(4)(A) of the Equity in Educational Land-Grant Status 
     Act of 1994 (7 U.S.C. 301 note; Public Law 103-382) is 
     amended by striking ``(as defined in section 390(3) of the 
     Carl D. Perkins Vocational and Applied Technology Education 
     Act, as such section was in effect on the day preceding the 
     date of enactment of the Carl. D. Perkins Vocational and 
     Applied Technology Education Amendments of 1998 (Oct. 31, 
     1998)) for each 1994 Institution for the fiscal year'' and 
     inserting ``(as defined in section 2(a) of the Tribally 
     Controlled College or University Assistance Act of 1978 (25 
     U.S.C. 1801(a)))''.
       (c) Accreditation Requirement for Research Grants.--Section 
     533(a)(3) of the Equity in Educational Land-Grant Status Act 
     of 1994 (7 U.S.C. 301 note; Public Law 103-382) is amended by 
     striking ``sections 534 and 535'' and inserting ``sections 
     534, 535, and 536''.
       (d) Technical Amendment To Reflect Name Changes.--Section 
     532 of the Equity in Educational Land-Grant Status Act of 
     1994 (7 U.S.C. 301 note; Public Law 103-382) is amended by 
     striking paragraphs (1) through (30) and inserting the 
     following:

[[Page H1874]]

       ``(1) Bay Mills Community College.
       ``(2) Blackfeet Community College.
       ``(3) Cankdeska Cikana Community College.
       ``(4) College of Menominee Nation.
       ``(5) Crownpoint Institute of Technology.
       ``(6) D-Q University.
       ``(7) Dine College.
       ``(8) Chief Dull Knife Memorial College.
       ``(9) Fond du Lac Tribal and Community College.
       ``(10) Fort Belknap College.
       ``(11) Fort Berthold Community College.
       ``(12) Fort Peck Community College.
       ``(13) Haskell Indian Nations University.
       ``(14) Institute of American Indian and Alaska Native 
     Culture and Arts Development.
       ``(15) Lac Courte Oreilles Ojibwa Community College.
       ``(16) Leech Lake Tribal College.
       ``(17) Little Big Horn College.
       ``(18) Little Priest Tribal College.
       ``(19) Nebraska Indian Community College.
       ``(20) Northwest Indian College.
       ``(21) Oglala Lakota College.
       ``(22) Salish Kootenai College.
       ``(23) Sinte Gleska University.
       ``(24) Sisseton Wahpeton Community College.
       ``(25) Si Tanka/Huron University.
       ``(26) Sitting Bull College.
       ``(27) Southwestern Indian Polytechnic Institute.
       ``(28) Stone Child College.
       ``(29) Turtle Mountain Community College.
       ``(30) United Tribes Technical College.
       ``(31) White Earth Tribal and Community College.''.
       (e) Report Recommending Criteria for Additional Eligible 
     Entities.--Not later than 1 year after the date of enactment 
     of this Act, the Secretary of Agriculture shall submit a 
     report containing recommended criteria for designating 
     additional 1994 Institutions to the Committee on Agriculture 
     of the House of Representatives and the Committee on 
     Agriculture, Nutrition, and Forestry of the Senate.

     SEC. 7202. CARRYOVER FOR EXPERIMENT STATIONS.

       Section 7 of the Hatch Act of 1887 (7 U.S.C. 361g) is 
     amended by striking subsection (c) and inserting the 
     following:
       ``(c) Carryover.--
       ``(1) In general.--The balance of any annual funds provided 
     under this Act to a State agricultural experiment station for 
     a fiscal year that remains unexpended at the end of the 
     fiscal year may be carried over for use during the following 
     fiscal year.
       ``(2) Failure to expend full allotment.--
       ``(A) In general.--If any unexpended balance carried over 
     by a State is not expended by the end of the second fiscal 
     year, an amount equal to the unexpended balance shall be 
     deducted from the next succeeding annual allotment to the 
     State.
       ``(B) Redistribution.--Federal funds that are deducted 
     under subparagraph (A) for a fiscal year shall be 
     redistributed by the Secretary in accordance with the formula 
     set forth in section 3(c) to those States for which no 
     deduction under subparagraph (A) has been taken for that 
     fiscal year.''.

     SEC. 7203. AUTHORIZATION PERCENTAGES FOR RESEARCH AND 
                   EXTENSION FORMULA FUNDS.

       (a) Extension.--Section 1444(a) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3221(a)) is amended--
       (1) by striking ``(a) There'' and inserting the following:
       ``(a) Authorization of Appropriations.--
       ``(1) In general.--There'';
       (2) by striking the second sentence; and
       (3) in the third sentence, by striking ``Beginning'' 
     through ``6 per centum'' and inserting the following:
       ``(2) Minimum amount.--Beginning with fiscal year 2003, 
     there shall be appropriated under this section for each 
     fiscal year an amount that is not less than 15 percent'';
       (3) by striking ``Funds appropriated'' and inserting the 
     following:
       ``(3) Uses.--Funds appropriated''; and
       (4) by striking ``No more'' and inserting the following:
       ``(4) Carryover.--No more''.
       (b) Research.--Section 1445(a) of the National Agricultural 
     Research, Extension, and Teaching Policy Act of 1977 (7 
     U.S.C. 3222(a)) is amended--
       (1) by striking ``(a) There'' and inserting the following:
       ``(a) Authorization of Appropriations.--
       ``(1) In general.--There'';
       (2) by striking the second sentence and inserting the 
     following:
       ``(2) Minimum amount.--Beginning with fiscal year 2003, 
     there shall be appropriated under this section for each 
     fiscal year an amount that is not less than 25 percent of the 
     total appropriations for the fiscal year under section 3 of 
     the Hatch Act of 1887 (7 U.S.C. 361c).'';
       (3) by striking ``Funds appropriated'' and inserting the 
     following:
       ``(3) Uses.--Funds appropriated'';
       (4) by striking ``The eligible'' and inserting the 
     following:
       ``(4) Coordination.--The eligible''; and
       (5) by striking ``No more'' and inserting the following:
       ``(5) Carryover.--No more''.

     SEC. 7204. CARRYOVER FOR ELIGIBLE INSTITUTIONS.

       Section 1445(a) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3222(a)) 
     (as amended by section 7203 of this Act) is further amended 
     by striking paragraph (5) and inserting the following:
       ``(5) Carryover.--
       ``(A) In general.--The balance of any annual funds provided 
     to an eligible institution for a fiscal year under this 
     section that remains unexpended at the end of the fiscal year 
     may be carried over for use during the following fiscal year.
       ``(B) Failure to expend full amount.--
       ``(i) In general.--If any unexpended balance carried over 
     by an eligible institution is not expended by the end of the 
     second fiscal year, an amount equal to the unexpended balance 
     shall be deducted from the next succeeding annual allotment 
     to the eligible institution.
       ``(ii) Redistribution.--Federal funds that are deducted 
     under clause (i) for a fiscal year shall be redistributed by 
     the Secretary in accordance with the formula set forth in 
     subsection (b)(2)(B) to those eligible institutions for which 
     no deduction under clause (i) has been taken for that fiscal 
     year.''.

     SEC. 7205. INITIATIVE FOR FUTURE AGRICULTURE AND FOOD 
                   SYSTEMS.

       (a) Funding.--Section 401(b) of the Agricultural Research, 
     Extension, and Education Reform Act of 1998 (7 U.S.C. 
     7621(b)) is amended--
       (1) in paragraph (1), by striking ``2002'' and inserting 
     ``2001''; and
       (2) by adding at the end the following:
       ``(3) Other funding.--Out of funds in the Commodity Credit 
     Corporation, the Secretary shall transfer to the Account--
       ``(A) on October 1, 2003, $120,000,000;
       ``(B) on October 1, 2004, $140,000,000;
       ``(C) on October 1, 2005, $160,000,000; and
       ``(D) on October 1, 2006, and each October 1 thereafter, 
     $200,000,000.''.
       (2) by amending subsection (c)(1) to read as follows:
       ``(1) Critical emerging agricultural and rural issues.--The 
     Secretary shall use the funds in the Account for research, 
     extension, and education grants (referred to in this section 
     as `grants') to address critical emerging agricultural and 
     rural issues related to--
       ``(A) future food production;
       ``(B) environmental quality and natural resource 
     management;
       ``(C) farm income; or
       ``(D) rural economic and business and community development 
     policy.''; and
       (3) in subsection (e)(1), by striking ``small and mid-
     sized'' and inserting ``small, mid-sized, and minority-
     serving''.

     SEC. 7206. ELIGIBILITY FOR INTEGRATED GRANTS PROGRAM.

       Section 406(b) of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (7 U.S.C. 7626(b)) is amended by 
     inserting ``and 1994 Institutions'' before ``on a competitive 
     basis''.

     SEC. 7207. AGRICULTURAL RESEARCH, EXTENSION, AND EDUCATION 
                   REFORM ACT OF 1998.

       (a) Precision Agriculture.--Section 403 of the Agricultural 
     Research, Extension, and Education Reform Act of 1998 (7 
     U.S.C. 7623) is amended--
       (1) in subsection (a)--
       (A) in paragraph (3)--
       (i) in subparagraph (A), inserting ``, horticultural,'' 
     following ``agronomic'' the second place it appears; and
       (ii) in subparagraph (C), by striking ``or'' at the end;
       (iii) in subparagraph (D), by striking the period at the 
     end and inserting ``; or''; and
       (iv) by adding at the end the following:
       ``(E) using such information to enable intelligent 
     mechanized harvesting and sorting systems for horticultural 
     crops.'';
       (B) in paragraph (4)--
       (i) in subparagraph (C), by striking ``or'' at the end;
       (ii) in subparagraph (D), by striking the period at the end 
     and inserting ``; or''; and
       (iii) by adding at the end the following:
       ``(E) robotic and other intelligent machines for use in 
     horticultural cropping systems.''; and
       (C) in paragraph (5)(F), by inserting ``(including improved 
     use of energy inputs)'' after ``farm production 
     efficiencies'';
       (2) in subsection (c)(2)--
       (A) by inserting ``or horticultural'' after ``agronomic''; 
     and
       (B) by striking ``and meteorological variability'' and 
     inserting ``product variability, and meteorological 
     variability'';
       (3) in subsection (d)--
       (A) by redesignating paragraphs (4) and (5) as paragraphs 
     (5) and (6), respectively; and
       (B) by inserting after paragraph (3) the following:
       ``(4) Improve farm energy use efficiencies.''.
       (b) Thomas Jefferson Initiative for Crop Diversification.--
     Section 405(a) of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (7 U.S.C. 7625(a)) is amended by 
     striking ``and marketing'' and inserting ``, marketing, and 
     efficient use''.
       (c) Coordinated Program of Research, Extension, and 
     Education To Improve Viability of Small- and Medium-Size 
     Dairy, Livestock, and Poultry Operations.--Section 407(b)(3) 
     of the Agricultural Research, Extension, and Education Reform 
     Act of 1998 (7 U.S.C. 7627(b)(3)) is amended by inserting 
     ``(including improved use of energy inputs)'' after ``poultry 
     systems that increase efficiencies''.
       (d) Support for Research Regarding Diseases of Wheat, 
     Triticale, and Barley Caused by Fusarium Graminearum or By 
     Tilletia Indica.--
       (1) Research grant authorized.--Section 408(a) of the 
     Agricultural Research, Extension, and Education Reform Act of 
     1998 (7 U.S.C. 7628(a)) is amended to read as follows:
       ``(a) Research Grant Authorized.--The Secretary of 
     Agriculture may make grants to consortia of land-grant 
     colleges and universities to enhance the ability of the 
     consortia to carry out multi-State research projects aimed at 
     understanding and combating diseases of wheat, triticale, and 
     barley caused by Fusarium graminearum and related fungi 
     (referred to in this section as `wheat scab') or by Tilletia 
     indica

[[Page H1875]]

     and related fungi (referred to in this section as `Karnal 
     bunt').''.
       (2) Research components.--Section 408(b) of such Act (7 
     U.S.C. 7628(b)) is amended--
       (A) in paragraph (1), by inserting ``or of Karnal bunt,'' 
     after ``epidemiology of wheat scab'';
       (B) in paragraph (1), by inserting ``, triticale,'' after 
     ``occurring in wheat'';
       (C) in paragraph (2), by inserting ``or Karnal bunt'' after 
     ``wheat scab'';
       (D) in paragraph (3)(A), by striking ``and barley for the 
     presence of'' and inserting ``, triticale, and barley for the 
     presence of Karnal bunt or of'';
       (E) in paragraph (3)(B), by striking ``and barley infected 
     with wheat scab'' and inserting ``, triticale, and barley 
     infected with wheat scab or with Karnal bunt'';
       (F) in paragraph (3)(C), by inserting ``wheat scab'' after 
     ``to render'';
       (G) in paragraph (4), by striking ``and barley to wheat 
     scab'' and inserting ``, triticale, and barley to wheat scab 
     and to Karnal bunt''; and
       (H) in paragraph (5)--
       (i) by inserting ``and Karnal bunt'' after ``wheat scab''; 
     and
       (ii) by inserting ``, triticale,'' after ``resistant 
     wheat''.
       (3) Communications networks.--Section 408(c) of such Act (7 
     U.S.C. 7628(c)) is amended by inserting ``or Karnal bunt'' 
     after ``wheat scab''.
       (4) Technical amendments.--(A) The section heading for 
     section 408 of such Act is amended by striking ``AND BARLEY 
     CAUSED BY FUSARIUM GRAMINEARUM'' and inserting ``, TRITICALE, 
     AND BARLEY CAUSED BY FUSARIUM GRAMINEARUM OR BY TILLETIA 
     INDICA''.
       (B) The table of sections for such Act is amended by 
     striking ``and barley caused by fusarium graminearum'' in the 
     item relating to section 408 and inserting ``, triticale, and 
     barley caused by Fusarium graminearum or by Tilletia 
     indica''.
       (e) Program to Control Johne's Disease.--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 new section:

     ``SEC. 409. BOVINE JOHNE'S DISEASE CONTROL PROGRAM.

       ``(a) Establishment.--The Secretary of Agriculture, in 
     coordination with State veterinarians and other appropriate 
     State animal health professionals, may establish a program to 
     conduct research, testing, and evaluation of programs for the 
     control and management of Johne's disease in livestock.
       ``(b) Authorization of Appropriations.--There is authorized 
     to be appropriated to the Secretary such sums as may be 
     necessary to carry out this section for each of fiscal years 
     2003 through 2007.''.

     SEC. 7208. FOOD, AGRICULTURE, CONSERVATION, AND TRADE ACT OF 
                   1990.

       (a) Agricultural Genome Initiative.--Section 1671(b) of the 
     Food, Agriculture, Conservation, and Trade Act of 1990 (7 
     U.S.C. 5924(b)) is amended--
       (1) in paragraph (3), by inserting ``pathogens and'' before 
     ``diseases causing economic hardship'';
       (2) in paragraph (6), by striking ``and'' at the end;
       (3) by redesignating paragraph (7) as paragraph (8); and
       (4) by inserting after paragraph (6) the following new 
     paragraph:
       ``(7) reducing the economic impact of plant pathogens on 
     commercially important crop plants; and''.
       (b) High-Priority Research and Extension Initiatives.--
     Section 1672(e) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5925) is amended by adding at the 
     end the following new paragraphs:
       ``(25) Genetically modified agriculture products (gmap) 
     research.--Research grants may be made under this section for 
     the purposes of providing unbiased, science-based evaluation 
     of the risks and benefits to the public and the environment 
     of specific genetically modified plant and animal products. 
     Grants may be used to form interdisciplinary teams to review 
     and conduct research on scientific, social, economic, and 
     ethical issues during the review process, to answer questions 
     raised by the release of new genetically modified agriculture 
     products, to conduct fundamental studies on the health and 
     environmental safety of genetically modified agriculture 
     products (including quantitative risk assessment, the effect 
     of specific genetically modified agriculture products on 
     human health, and gene flow studies), to communicate the risk 
     of genetically modified agriculture products through 
     extension and education programs, and to engage the public 
     and industry in relevant issues.
       ``(26) Wind erosion research and extension.--Research and 
     extension grants may be made under this section for the 
     purpose of validating wind erosion models.
       ``(27) Crop loss research and extension.--Research and 
     extension grants may be made under this section for the 
     purpose of validating crop loss models.
       ``(28) Land use management research and extension.--
     Research and extension grants may be made under this section 
     for the purposes of evaluating the environmental benefits of 
     land use management tools such as those provided in the 
     Farmland Protection Program.
       ``(29) Water and air quality research and extension.--
     Research and extension grants may be made under this section 
     for the purpose of better understanding agricultural impacts 
     to air and water quality and means to address them.
       ``(30) Revenue and insurance tools research and 
     extension.--Research and extension grants may be made under 
     this section for the purposes of better understanding the 
     impact of revenue and insurance tools on farm income.
       ``(31) Agrotourism research and extension.--Research and 
     extension grants may be made under this section for the 
     purpose of better understanding the economic, environmental, 
     and food systems impacts of agrotourism.
       ``(32) Harvesting productivity for fruits and vegetables.--
     Research and extension grants may be made under this section 
     for the purpose of improving harvesting productivity for 
     fruits and vegetables (including citrus), including the 
     development of mechanical harvesting technologies and 
     effective, economical, and safe abscission compounds.
       ``(33) Nitrogen-fixation by plants.--Research and extension 
     grants may be made under this section for the purpose of 
     enhancing the nitrogen-fixing ability and efficiency of 
     legumes, developing new varieties of legumes that fix 
     nitrogen more efficiently, and developing new varieties of 
     other commercially important crops that potentially are able 
     to fix nitrogen.
       ``(34) Agricultural marketing.--Extension grants may be 
     made under this section for the purpose of providing 
     education materials, information, and outreach programs 
     regarding commodity and livestock marketing strategies for 
     agricultural producers and for cooperatives and other 
     marketers of any agricultural commodity, including livestock.
       ``(35) Environment and private lands research and 
     extension.--Research and extension grants may be made under 
     this section for the purpose of researching the use of 
     computer models to aid in assessment of best management 
     practices on a watershed basis, working with government, 
     industry, and private landowners to help craft industry-led 
     solutions to identified environmental issues, researching and 
     monitoring water, air, or soil environmental quality to aid 
     in the development of new approaches to local environmental 
     concerns, and working with local, State, and federal 
     officials to help craft effective environmental solutions 
     that respect private property rights and agricultural 
     production realities.
       ``(36) Livestock disease research and extension.--Research 
     and extension grants may be made under this section for the 
     purpose of identifying possible livestock disease threats, 
     educating the public regarding livestock disease threats, 
     training persons to deal with such threats, and conducting 
     related research.
       ``(37) Plant gene expression.--Research grants may be made 
     under this section for the purpose of plant gene expression 
     research to accelerate the application of basic plant genomic 
     science to the development and testing of new varieties of 
     enhanced food crops, crops that can be used as renewable 
     energy sources, and other alternative uses of agricultural 
     crops.
       ``(38) Animal infectious diseases research.--Research and 
     extension grants may be made under this section for the 
     purpose of developing prevention and control methodologies 
     for animal infectious diseases (including evaluation under 
     field conditions in countries in which an animal disease 
     occurs) such as laboratory tests for quicker detection of 
     infected animals and presence of disease, prevention 
     strategies (including vaccination programs), and rapid 
     diagnostic techniques for animal disease agents considered to 
     be risks for agricultural bioterrorism attack.
       ``(39) Program to combat childhood obesity.--Research and 
     extension grants may be made under this section to 
     institutions of higher education with demonstrated capacity 
     in basic and clinical obesity research, nutrition research, 
     and community health education research to develop and 
     evaluate community-wide strategies that catalyze partnerships 
     between families and health care, education, recreation, mass 
     media, and other community resources to reduce the incidence 
     of childhood obesity.
       ``(40) Integrated pest management.--Research and extension 
     grants may be made under this section to coordinate and 
     improve research, education, and outreach on, and 
     implementation on farms of, integrated pest management.
       ``(41) Beef cattle genetics.--Research and extension grants 
     for beef cattle genetics evaluation research may be made 
     under this section to consortia of institutions of higher 
     education that have expertise in beef cattle genetic 
     evaluation research and technology and that have been 
     actively involved for at least 20 years in the estimation and 
     prediction of progeny differences for publication and use by 
     seed stock producer breed associations.
       ``(42) Dairy pipeline cleaner.--Research and extension 
     grants may be made under this section for the purpose of 
     preventing and eliminating the dangers of dairy pipeline 
     cleaner, including development of safer packaging and 
     transfer mechanisms, outlining accident causes and potential 
     prevention measures, and other means of improving efforts to 
     prevent ingestion of dairy pipeline cleaner.
       ``(43) Development of publicly held plants and animal 
     varieties.--Research and extension grants may be made under 
     this section for the purpose of development of publicly held 
     plants and animal varieties (including germplasm for 
     identity-preserved markets) and genetic resource conservation 
     activities.
       ``(44) Sugarcane genetics.--Research grants may be made 
     under this section for the purpose of maintaining acceptable 
     yields under reduced production inputs, implementing marker-
     assisted breeding strategies and other basic plant genomic 
     technologies to screen for improved plant resistance to 
     diseases, weeds, and insects toward minimizing pesticide use, 
     enhancing food, fiber and energy production, and developing 
     varieties for maximum performance under prevailing 
     conditions, including management for improved soil and water 
     conservation.''.
       (c) Assistive Technology Program for Farmers With 
     Disabilities.--Section 1680(a) of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 5933(a)) is 
     amended by adding at the end the following new paragraph:

[[Page H1876]]

       ``(6) Consideration for grants for new programs.--For each 
     fiscal year that amounts are made available for grants under 
     this subsection, the Secretary may make grants in a manner 
     that ensures that eligible entities who apply for grants, but 
     have not previously received a grant under this subsection, 
     are given full consideration.''.

     SEC. 7209. NATIONAL AGRICULTURAL RESEARCH, EXTENSION, AND 
                   TEACHING POLICY ACT OF 1977.

       (a) National Agricultural Research, Extension, Education, 
     and Economic Advisory Board.--Section 1408 of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3123) is amended--
       (1) in subsection (b)(1), by striking ``30 members'' and 
     inserting ``31 members'';
       (2) in subsection (b)(3)--
       (A) by redesignating subparagraphs (R) through (DD) as 
     subparagraphs (S) through (EE), respectively; and
       (B) by inserting after subparagraph (Q) the following new 
     subparagraph:
       ``(R) 1 member representing a non-land grant college or 
     university with a historic commitment to research in the food 
     and agricultural sciences.'';
       (3) in subsection (c)(1), by striking ``and land-grant 
     colleges and universities'' and inserting ``, land-grant 
     colleges and universities, and the Committee on Agriculture 
     of the House of Representatives, the Committee on 
     Agriculture, Nutrition, and Forestry of the Senate, the 
     Subcommittee on Agriculture, Rural Development, Food and Drug 
     Administration and Related Agencies of the Committee on 
     Appropriations of the House of Representatives, and the 
     Subcommittee on Agriculture, Rural Development and Related 
     Agencies of the Committee on Appropriations of the Senate''; 
     and
       (4) in subsection (d)(1), inserting ``consult with any 
     appropriate agencies of the Department of Agriculture and'' 
     after ``the Advisory Board shall''.
       (b) Grants for Research on Production and Marketing of 
     Alcohols and Industrial Hydrocarbons from Agricultural 
     Commodities and Forest Products.--Section 1419 of the 
     National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 (7 U.S.C. 3154) is amended--
       (1) in subsection (a)(2), by inserting ``and animal fats 
     and oils'' after ``industrial oilseed crops''; and
       (2) in subsection (a)(4), by inserting ``or triglycerides'' 
     after ``other industrial hydrocarbons''.
       (c) FAS Overseas Intern Program.--Section 1458(a) of the 
     National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 (7 U.S.C. 3291(a)) is amended--
       (1) by striking ``and'' at the end of paragraph (8);
       (2) by striking the period at the end of paragraph (9) and 
     inserting ``; and''; and
       (3) by adding at the end the following new paragraph:
       ``(10) establish a program, to be coordinated by the 
     Cooperative State Research, Education, and Extension Service 
     and the Foreign Agricultural Service, to place interns from 
     United States colleges and universities at Foreign 
     Agricultural Service field offices overseas.''.
       (d) Rangeland Research Grants.--Section 1480 of the 
     National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 (7 U.S.C. 3333) is amended to read as 
     follows:

     ``SEC. 1480. RANGELAND RESEARCH GRANTS.

       ``(a) In General.--The Secretary may make grants to--
       ``(1) land-grant colleges and universities, State 
     agricultural experiment stations, and colleges, universities, 
     and Federal laboratories having a demonstrable capacity in 
     rangeland research, as determined by the Secretary, to carry 
     out rangeland research; and
       ``(2) the Joe Skeen Institute for Rangeland Restoration for 
     the purposes of facilitating and expanding ongoing State-
     Federal range management, animal husbandry, and agricultural 
     research, education, and extension programs to meet the 
     targeted, emerging, and future needs of western United States 
     rangelands and associated natural resources.
       ``(b) Matching Requirements.--
       ``(1) In general.--Except as provided in paragraph (2), 
     this grant program shall be based on a matching formula of 50 
     percent Federal and 50 percent non-Federal funding.
       ``(2) Exception.--Paragraph (1) shall not apply to a grant 
     to a Federal laboratory or a grant under subsection 
     (a)(2).''.

     SEC. 7210. BIOTECHNOLOGY RISK ASSESSMENT RESEARCH.

       Section 1668 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5921) is amended to read as 
     follows:

     ``SEC. 1668. BIOTECHNOLOGY RISK ASSESSMENT RESEARCH.

       ``(a) Purpose.--It is the purpose of this section--
       ``(1) to authorize and support environmental assessment 
     research to help identify and analyze environmental effects 
     of biotechnology; and
       ``(2) to authorize research to help regulators develop 
     long-term policies concerning the introduction of such 
     technology.
       ``(b) Grant Program.--The Secretary of Agriculture shall 
     establish a grant program within the Cooperative State 
     Research, Education, and Extension Service and the 
     Agricultural Research Service to provide the necessary 
     funding for environmental assessment research concerning the 
     introduction of genetically engineered animals, plants, and 
     microorganisms into the environment.
       ``(c) Research Priorities.-- The following types of 
     research shall be given priority for funding:
       ``(1) Research designed to identify and develop appropriate 
     management practices to minimize physical and biological 
     risks associated with genetically engineered animals, plants, 
     and microorganisms.
       ``(2) Research designed to develop methods to monitor the 
     dispersal of genetically engineered animals, plants, and 
     microorganisms.
       ``(3) Research designed to further existing knowledge with 
     respect to the characteristics, rates, and methods of gene 
     transfer that may occur between genetically engineered 
     animals, plants, and microorganisms and related wild and 
     agricultural organisms.
       ``(4) Environmental assessment research designed to provide 
     analysis which compares the relative impacts of animals, 
     plants, and microorganisms modified through genetic 
     engineering to other types of production systems.
       ``(5) Other areas of research designed to further the 
     purposes of this section.
       ``(d) Eligibility Requirements.--Grants under this section 
     shall be--
       ``(1) made on the basis of the quality of the proposed 
     research project; and
       ``(2) available to any public or private research or 
     educational institution or organization.
       ``(e) Consultation.-- In considering specific areas of 
     research for funding under this section, the Secretary of 
     Agriculture shall consult with the Administrator of the 
     Animal and Plant Health Inspection Service and the National 
     Agricultural Research, Extension, Education, and Economics 
     Advisory Board.
       ``(f) Program Coordination.-- The Secretary of Agriculture 
     shall coordinate research funded under this section with the 
     Office of Research and Development of the Environmental 
     Protection Agency in order to avoid duplication of research 
     activities.
       ``(g) Authorization of Appropriations.--
       ``(1) In general.-- There are authorized to be appropriated 
     such sums as necessary to carry out this section.
       ``(2) Withholdings from biotechnology outlays.--The 
     Secretary of Agriculture shall withhold from outlays of the 
     Department of Agriculture for research on biotechnology, as 
     defined and determined by the Secretary, at least 2 percent 
     of such amount for the purpose of making grants under this 
     section for research on biotechnology risk assessment.
       ``(3) Application of Funds.--Funds made available under 
     this subsection shall be applied, to the maximum extent 
     practicable, to risk assessment research on all categories 
     identified in subsection (c).''.

     SEC. 7211. COMPETITIVE, SPECIAL, AND FACILITIES RESEARCH 
                   GRANTS.

       Section 2(b)(2) of the Competitive, Special, and Facilities 
     Research Grant Act (7 U.S.C. 450i(b)(2)) is amended by 
     striking ``in--'' and inserting the following: ``in the areas 
     described in subparagraphs (A) through (F). Such needs shall 
     be determined by the Secretary, in consultation with the 
     National Agricultural Research, Extension, Education, and 
     Economics Advisory Board, not later than July 1 of each 
     fiscal year for the purposes of the following fiscal year.''.

     SEC. 7212. MATCHING FUNDS REQUIREMENT FOR RESEARCH AND 
                   EXTENSION ACTIVITIES OF 1890 INSTITUTIONS.

       Section 1449 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3222d) 
     is amended--
       (1) by amending subsection (c) to read as follows:
       ``(c) Matching Formula.--Notwithstanding any other 
     provision of this subtitle, for each of fiscal years 2003 
     through 2007, the State shall provide matching funds from 
     non-Federal sources. Such matching funds shall be for an 
     amount equal to not less than--
       ``(1) 60 percent of the formula funds to be distributed to 
     the eligible institution for fiscal year 2003;
       ``(2) 70 percent of the formula funds to be distributed to 
     the eligible institution for fiscal year 2004;
       ``(3) 80 percent of the formula funds to be distributed to 
     the eligible institution for fiscal year 2005;
       ``(4) 90 percent of the formula funds to be distributed to 
     the eligible institution for fiscal year 2006; and
       ``(5) 100 percent of the formula funds to be distributed to 
     the eligible institution for fiscal year 2007 and each fiscal 
     year thereafter.''; and
       (2) by amending subsection (d) to read as follows:
       ``(d) Waiver Authority.--Notwithstanding subsection (f), 
     the Secretary may waive the matching funds requirement under 
     subsection (c) above the 50 percent level for any fiscal year 
     for an eligible institution of a State if the Secretary 
     determines that the State will be unlikely to satisfy the 
     matching requirement.''.

     SEC. 7213. MATCHING REQUIREMENTS FOR RESEARCH AND EXTENSION 
                   FORMULA FUNDS FOR INSULAR AREA LAND-GRANT 
                   INSTITUTIONS.

       (a) Experiment Stations.--Section 3(d) of the Hatch Act of 
     1887 (7 U.S.C. 361c(d)) is amended by striking paragraph (4) 
     and inserting the following:
       ``(4) Exception for insular areas.--
       ``(A) In general.--Effective beginning for fiscal year 
     2003, in lieu of the matching funds requirement of paragraph 
     (1), the insular areas of the Commonwealth of Puerto Rico, 
     Guam, and the Virgin Islands of the United States shall 
     provide matching funds from non-Federal sources in an amount 
     equal to not less than 50 percent of the formula funds 
     distributed by the Secretary to each of the insular areas, 
     respectively, under this section.
       ``(B) Waivers.--The Secretary may waive the matching fund 
     requirement of subparagraph (A) for any fiscal year if the 
     Secretary determines that the government of the insular area 
     will be unlikely to meet the matching requirement for the 
     fiscal year.''.

[[Page H1877]]

       (b) Cooperative Agricultural Extension.--Section 3(e) of 
     the Smith-Lever Act (7 U.S.C. 343(e)) is amended by striking 
     paragraph (4) and inserting the following:
       ``(4) Exception for insular areas.--
       ``(A) In general.--Effective beginning for fiscal year 
     2003, in lieu of the matching funds requirement of paragraph 
     (1), the insular areas of the Commonwealth of Puerto Rico, 
     Guam, and the Virgin Islands of the United States shall 
     provide matching funds from non-Federal sources in an amount 
     equal to not less than 50 percent of the formula funds 
     distributed by the Secretary to each of the insular areas, 
     respectively, under this section.
       ``(B) Waivers.--The Secretary may waive the matching fund 
     requirement of subparagraph (A) for any fiscal year if the 
     Secretary determines that the government of the insular area 
     will be unlikely to meet the matching requirement for the 
     fiscal year.''.

     SEC. 7214. DEFINITION OF FOOD AND AGRICULTURAL SCIENCES.

       Section 2(3) of the Research Facilities Act (7 U.S.C. 
     390(2)(3)) is amended to read as follows:
       ``(3) Food and agricultural sciences.--The term `food and 
     agricultural sciences' has the meaning given that term in 
     section 1404(8) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
     3103(8)).''.

     SEC. 7215. FEDERAL EXTENSION SERVICE.

       Section 3(b)(3) of the Smith-Lever Act (7 U.S.C. 343(b)(3)) 
     is amended--
       (1) by striking ``$5,000,000'' and inserting ``such sums as 
     are necessary''; and
       (2) by adding after the first sentence the following new 
     sentence: ``The balance of any annual funds provided under 
     the preceding sentence for a fiscal year that remains 
     unexpended at the end of that fiscal year shall remain 
     available without fiscal year limitation.''.

     SEC. 7216. POLICY RESEARCH CENTERS.

       Section 1419A(c)(3) of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 
     3155(c)(3)) is amended by striking ``collect and analyze'' 
     and inserting ``collect, analyze, and disseminate''.

     SEC. 7217. AVAILABILITY OF COMPETITIVE GRANT FUNDS.

       The National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 is amended by inserting after section 1469 
     (7 U.S.C. 3315) the following:

     ``SEC. 1469A. AVAILABILITY OF COMPETITIVE GRANT FUNDS.

       ``Except as otherwise provided by law, funds made available 
     to the Secretary to carry out a competitive agricultural 
     research, education, or extension grant program under this or 
     any other Act shall be available for obligation for a 2-year 
     period beginning on October 1 of the fiscal year for which 
     the funds are made available.''.

     SEC. 7218. ORGANIC AGRICULTURE RESEARCH AND EXTENSION 
                   INITIATIVE.

       Section 1672B of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (7 U.S.C. 5925b) is amended--
       (1) in subsection (a)--
       (A) in paragraph (1), by inserting ``, breeding,'' after 
     ``production'';
       (B) in paragraph (2), by striking ``and'' at the end;
       (C) in paragraph (3), by striking the period at the end and 
     inserting a semicolon; and
       (D) by adding at the end the following:
       ``(4) determining desirable traits for organic commodities;
       ``(5) identifying marketing and policy constraints on the 
     expansion of organic agriculture; and
       ``(6) conducting advanced on-farm research and development 
     that emphasizes observation of, experimentation with, and 
     innovation for working organic farms, including research 
     relating to production and marketing and to socioeconomic 
     conditions.''; and
       (2) by amending subsection (e) to read as follows:
       ``(e) Funding.--On October 1, 2003, and each October 1 
     thereafter through October 1, 2007, out of any funds in the 
     Treasury not otherwise appropriated, the Secretary of the 
     Treasury shall transfer $3,000,000 to the Secretary of 
     Agriculture for this section.''.

     SEC. 7219. SENIOR SCIENTIFIC RESEARCH SERVICE.

       Subtitle B of title VI of the Agricultural Research, 
     Extension, and Education Reform Act of 1998 (7 U.S.C. 7651 et 
     seq.) is amended by adding at the end the following:

     ``SEC. 620. SENIOR SCIENTIFIC RESEARCH SERVICE.

       ``(a) In General.--There is established in the Department 
     of Agriculture the Senior Scientific Research Service 
     (referred to in this section as the `Service').
       ``(b) Members.--
       ``(1) In general.--Subject to paragraphs (2) through (4), 
     the Secretary shall appoint the members of the Service.
       ``(2) Qualifications.--To be eligible for appointment to 
     the Service, an individual shall--
       ``(A) have conducted outstanding research in the field of 
     agriculture or forestry;
       ``(B) have earned a doctoral level degree at an institution 
     of higher education (as defined in section 101 of the Higher 
     Education Act of 1965 (20 U.S.C. 1001)); and
       ``(C) meet qualification standards prescribed by the 
     Director of the Office of Personnel Management for 
     appointment to a position at level GS-15 of the General 
     Schedule.
       ``(3) Number.--Not more than 100 individuals may serve as 
     members of the Service at any 1 time.
       ``(4) Other requirements.--
       ``(A) In general.--Subject to subparagraph (B) and 
     subsection (d)(2), the Secretary may appoint and employ a 
     member of the Service without regard to--
       ``(i) the provisions of title 5, United States Code, 
     governing appointments in the competitive service;
       ``(ii) the provisions of subchapter I of chapter 35 of 
     title 5, United States Code, relating to retention 
     preference;
       ``(iii) the provisions of chapter 43 of title 5, United 
     States Code, relating to performance appraisal and 
     performance actions;
       ``(iv) the provisions of chapter 51 and subchapter III of 
     chapter 53 of title 5, United States Code, relating to 
     classification and General Schedule pay rates; and
       ``(v) the provisions of chapter 75 of title 5, United 
     States Code, relating to adverse actions.
       ``(B) Exception.--A member of the Service appointed and 
     employed by the Secretary under subparagraph (A) shall have 
     the same right of appeal to the Merit Systems Protection 
     Board and the same right to file a complaint with the Office 
     of Special Counsel as an employee appointed to a position at 
     level GS-15 of the General Schedule.
       ``(c) Performance Appraisal System.--The Secretary shall 
     develop a performance appraisal system for members of the 
     Service that is designed to--
       ``(1) provide for the systematic appraisal of the 
     employment performance of the members; and
       ``(2) encourage excellence in employment performance by the 
     members.
       ``(d) Compensation.--
       ``(1) In general.--Subject to paragraph (2), the Secretary 
     shall determine the compensation of members of the Service.
       ``(2) Limitations.--The rate of pay for a member of the 
     Service shall--
       ``(A) not be less than the minimum rate payable for a 
     position at level GS-15 of the General Schedule; and
       ``(B) not be more than the rate payable for a position at 
     level I of the Executive Schedule, unless the rate is 
     approved by the President under section 5377(d)(2) of title 
     5, United States Code.
       ``(e) Retirement Contributions.--
       ``(1) In general.--On the request of a member of the 
     Service who was an employee of an institution of higher 
     education (as defined in section 101 of the Higher Education 
     Act of 1965 (20 U.S.C. 1001)) immediately prior to 
     appointment as a member of the Service and who retains the 
     right to continue to make contributions to the retirement 
     system of the institution, the Secretary may contribute an 
     amount not to exceed 10 percent of the basic pay of the 
     member to the retirement system of the institution on behalf 
     of the member.
       ``(2) Federal retirement system.--
       ``(A) In general.--Subject to subparagraph (B), a member 
     for whom a contribution is made under paragraph (1) shall 
     not, as a result of serving as a member of the Service, be 
     covered by, or earn service credit under, chapter 83 or 84 of 
     title 5, United States Code.
       ``(B) Annual leave.--Service of a member of the Service 
     described in subparagraph (A) shall be creditable for 
     determining years of service under section 6303(a) of title 
     5, United States Code.
       ``(f) Involuntary Separation.--
       ``(1) In general.--Subject to paragraph (2) and 
     notwithstanding the provisions of title 5, United States 
     Code, governing appointment in the competitive service, in 
     the case of an individual who is separated from the Service 
     involuntarily and without cause--
       ``(A) the Secretary may appoint the individual to a 
     position in the competitive civil service at level GS-15 of 
     the General Schedule; and
       ``(B) the appointment shall be a career appointment.
       ``(2) Excepted civil service.--In the case of an individual 
     described in paragraph (1) who immediately prior to 
     appointment as a member of the Service was not a career 
     appointee in the civil service or the Senior Executive 
     Service, the appointment of the individual under paragraph 
     (1)--
       ``(A) shall be to the excepted civil service; and
       ``(B) may not exceed a period of 2 years.''.

     SEC. 7220. TERMINATION OF CERTAIN SCHEDULE A APPOINTMENTS.

       (a) Termination.--Not later than January 31, 2003, the 
     Secretary of Agriculture shall terminate each appointment 
     listed as an excepted position under schedule A of the 
     General Schedule made by the Secretary to the Federal civil 
     service of an individual who holds dual government 
     appointments, and who carries out agricultural extension work 
     in a program at a college or university eligible to receive 
     funds, under--
       (1) the Smith-Lever Act (7 U.S.C. 341 et seq.);
       (2) section 1444 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3221); 
     or
       (3) section 208(e) of the District of Columbia Public 
     Postsecondary Education Reorganization Act (88 Stat. 1428).
       (b) Continuation of Certain Federal Benefits.--
       (1) In general.--Notwithstanding title 5, United States 
     Code, and subject to paragraph (2), an individual described 
     in subsection (a), during the period the individual is 
     employed in an agricultural extension program described in 
     subsection (a) without a break in service, shall continue 
     to--
       (A) be eligible to participate, to the same extent that the 
     individual was eligible to participate (on the day before the 
     date of enactment of this Act), in--
       (i) the Federal Employee Health Benefits Program;
       (ii) the Federal Employee Group Life Insurance Program;
       (iii) the Civil Service Retirement System;
       (iv) the Federal Employee Retirement System;
       (v) the Thrift Savings Plan; and
       (vi) the Federal Long Term Care Insurance Program; and
       (B) receive Federal Civil Service employment credit to the 
     same extent that the individual was

[[Page H1878]]

     receiving such credit on the day before the date of enactment 
     of this Act.
       (2) Limitations.--An individual may continue to be eligible 
     for the benefits described in paragraph (1) if--
       (A) in the case of an individual who remains employed in 
     the agricultural extension program described in subsection 
     (a) on the date of enactment of this Act, the employing 
     college or university continues to fulfill the administrative 
     and financial responsibilities (including making agency 
     contributions) associated with providing those benefits, as 
     determined by the Secretary of Agriculture; and
       (B) in the case of an individual who changes employment to 
     a second college or university described in subsection (a)--
       (i) the individual continues to work in an agricultural 
     extension program described in subsection (a), as determined 
     by the Secretary of Agriculture;
       (ii) the second college or university--

       (I) fulfills the administrative and financial 
     responsibilities (including making agency contributions) 
     associated with providing those benefits, as determined by 
     the Secretary of Agriculture; and
       (II) within 1 year before the date of the employment of the 
     individual, had employed a different individual described in 
     subsection (a) who had performed the same duties of 
     employment; and

       (iii) the individual was eligible for those benefits on the 
     day before the date of enactment of this Act.

     SEC. 7221. BIOSECURITY PLANNING AND RESPONSE PROGRAMS.

       (a) Biosecurity.--The National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3101 et 
     seq.) is amended by adding at the end the following:
                       ``Subtitle N--Biosecurity

     ``SEC. 1484. SPECIAL AUTHORIZATION FOR BIOSECURITY PLANNING 
                   AND RESPONSE.

       ``(a) Authorization of Appropriations.--In addition to 
     amounts for agricultural research, extension, and education 
     under this Act, there are authorized to be appropriated for 
     agricultural research, education, and extension activities 
     for biosecurity planning and response such sums as are 
     necessary for each of fiscal years 2002 through 2007.
       ``(b) Use of Funds.--Using any authority available to the 
     Secretary, the Secretary shall use funds made available under 
     this section to carry out agricultural research, education, 
     and extension activities (including through competitive 
     grants) for the following:
       ``(1) To reduce the vulnerability of the United States food 
     and agricultural system to chemical or biological attack.
       ``(2) To continue partnerships with institutions of higher 
     education and other institutions to help form stable, long-
     term programs to enhance the biosecurity of the United 
     States, including the coordination of the development, 
     implementation, and enhancement of diverse capabilities for 
     addressing threats to the Nation's agricultural economy and 
     food supply with special emphasis on planning, training, 
     outreach, and research activities related to vulnerability 
     analyses, incident response, and detection and prevention 
     technologies.
       ``(3) To make competitive grants to universities and 
     qualified research institutions for research on 
     counterbioterrorism.
       ``(4) To counter or otherwise respond to chemical or 
     biological attack.

     ``SEC. 1485. AGRICULTURE RESEARCH FACILITY EXPANSION AND 
                   SECURITY UPGRADES.

       ``(a) In General.--To enhance the security of agriculture 
     in the United States against threats posed by bioterrorism, 
     the Secretary shall make expansion or security upgrade grants 
     on a competitive basis to colleges and universities (as 
     defined in section 1404(4)).
       ``(b) Limitation on Grants.--Grants to a recipient under 
     this section shall not exceed $10,000,000 in any fiscal year.
       ``(c) Requirements for Grants.--The Secretary shall make a 
     grant under this section only if the grant applicant provides 
     satisfactory assurances to the Secretary that--
       ``(1) sufficient funds are available to pay the non-Federal 
     share of the cost of the proposed expansion or security 
     upgrades; and
       ``(2) the proposed expansion or security upgrades meet such 
     reasonable qualifications as may be established by the 
     Secretary with respect to biosafety and biosecurity 
     requirements necessary to protect facility staff, members of 
     the public, and the food supply.
       ``(d) Additional Requirements for Grants for Facility 
     Expansion.--The Secretary shall make a grant under this 
     section for the expansion, renovation, remodeling, or 
     alteration (collectively referred to in this section as 
     ``expansion'') of a facility only if the grant applicant 
     provides such assurances as the Secretary determines to be 
     satisfactory to ensure the following:
       ``(1) For not less than 20 years after the grant is 
     awarded, the facility shall be used for the purposes of the 
     research for which the facility was expanded, as described in 
     the grant application.
       ``(2) Sufficient funds will be available, as of the date of 
     completion of the expansion, for the effective use of the 
     facility for the purposes of the research for which the 
     facility was expanded.
       ``(3) The proposed expansion--
       ``(A) will increase the capability of the applicant to 
     conduct research for which the facility was expanded; or
       ``(B) is necessary to improve the quality of the research 
     of the applicant.
       ``(e) Amount of Grant.--The amount of a grant awarded under 
     this section shall be determined by the Secretary.
       ``(f) Federal Share.--The Federal share of the cost of any 
     expansion or security upgrade carried out using funds from a 
     grant provided under this section shall not exceed 50 
     percent.
       ``(g) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section such 
     sums as are necessary for each fiscal year.''.
       (b) Sense of Congress on Increasing Capacity for Research 
     on Biosecurity and Animal and Plant Health Diseases.--It is 
     the sense of Congress that funding for the Agricultural 
     Research Service, the Animal and Plant Health Inspection 
     Service, and other agencies of the Department of Agriculture 
     with responsibilities for biosecurity should be increased as 
     necessary to improve the capacity of the agencies to conduct 
     research and analysis of, and respond to, bioterrorism and 
     animal and plant diseases.

     SEC. 7222. INDIRECT COSTS FOR SMALL BUSINESS INNOVATION 
                   RESEARCH GRANTS.

       Section 1462 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3310) is 
     amended--
       (1) by inserting ``(a) In General.--'' before ``Except''; 
     and
       (2) by adding at the end the following:
       ``(b) Exception.--Subsection (a) shall not apply to a grant 
     awarded competitively under section 9 of the Small Business 
     Act (15 U.S.C. 638).''.

     SEC. 7223. CARBON CYCLE RESEARCH.

       Section 221 of the Agricultural Risk Protection Act of 2000 
     (Public Law 106-224; 114 Stat. 407), as amended by section 
     9009 of this Act, is amended--
       (1) in subsection (a), by striking ``Of the amount'' and 
     all that follows through ``to provide'' and inserting ``To 
     the extent funds are made available for this purpose, the 
     Secretary shall provide'';
       (2) in subsection (f), by striking ``under subsection (a)'' 
     and inserting ``for this section''; and
       (3) by adding at the end the following new subsection:
       ``(g) Authorization of Appropriations.--There are 
     authorized to be appropriated for fiscal years 2002 through 
     2007 such sums as may be necessary to carry out this 
     section.''.
        Subtitle C--Repeal of Certain Activities and Authorities

     SEC. 7301. FOOD SAFETY RESEARCH INFORMATION OFFICE AND 
                   NATIONAL CONFERENCE.

       (a) Repeal.--Subsections (b) and (c) of section 615 of the 
     Agricultural Research, Extension, and Education Reform Act of 
     1998 (7 U.S.C. 7654(b) and (c)) are repealed.
       (b) Conforming Amendments.--
       (1) Generally.--Section 615 of such Act is amended--
       (A) in the section heading, by striking ``AND NATIONAL 
     CONFERENCE'';
       (B) by striking ``(a) Food Safety Research Information 
     Office.--'';
       (C) by redesignating paragraphs (1), (2), and (3) as 
     subsections (a), (b), and (c), respectively, and moving the 
     margins 2 ems to the left;
       (D) in subsection (b) (as so redesignated), by 
     redesignating subparagraphs (A) and (B) as paragraphs (1) and 
     (2), respectively, and moving the margins 2 ems to the left; 
     and
       (E) in subsection (c) (as so redesignated), by striking 
     ``this subsection'' and inserting ``this section''.
       (2) Table of sections.--The table of sections for such Act 
     is amended by striking ``and National Conference'' in the 
     item relating to section 615.

     SEC. 7302. REIMBURSEMENT OF EXPENSES UNDER SHEEP PROMOTION, 
                   RESEARCH, AND INFORMATION ACT OF 1994.

       Section 617 of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (Public Law 105-185; 112 Stat. 
     607) is repealed.

     SEC. 7303. MARKET EXPANSION RESEARCH.

       Section 1436 of the Food Security Act of 1985 (7 U.S.C. 
     1632) is repealed.

     SEC. 7304. NATIONAL ADVISORY BOARD ON AGRICULTURAL WEATHER.

       (a) Repeal.--Section 1639 of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 5853) is 
     repealed.
       (b) Conforming Amendment.--Section 1640(b) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5854(b)) is amended by striking ``take into'' and all that 
     follows through ``Weather and''.

     SEC. 7305. AGRICULTURAL INFORMATION EXCHANGE WITH IRELAND.

       Section 1420 of the National Agricultural Research, 
     Extension and Teaching Policy Act Amendments of 1985 (Public 
     Law 99-198; 99 Stat. 1551) is repealed.

     SEC. 7306. PESTICIDE RESISTANCE STUDY.

       Section 1437 of the National Agricultural Research, 
     Extension, and Teaching Policy Act Amendments of 1985 (Public 
     Law 99-198; 99 Stat. 1558) is repealed.

     SEC. 7307. EXPANSION OF EDUCATION STUDY.

       Section 1438 of the National Agricultural Research, 
     Extension, and Teaching Policy Act Amendments of 1985 (Public 
     Law 99-198; 99 Stat. 1559) is repealed.

     SEC. 7308. TASK FORCE ON 10-YEAR STRATEGIC PLAN FOR 
                   AGRICULTURAL RESEARCH FACILITIES.

       (a) Repeal.--Section 4 of the Research Facilities Act (7 
     U.S.C. 390b) is repealed.
       (b) Conforming Amendment.--Section 2 of such Act (7 U.S.C. 
     390) is amended by striking paragraph (5).
                      Subtitle D--New Authorities

     SEC. 7401. SUBTITLE DEFINITIONS.

       In this subtitle:
       (1) Department.--The term ``Department'' means the 
     Department of Agriculture.
       (2) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.

[[Page H1879]]

     SEC. 7402. RESEARCH EQUIPMENT GRANTS.

       The National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 is amended by inserting after section 1462 
     (7 U.S.C. 3310) the following:

     ``SEC. 1462A. RESEARCH EQUIPMENT GRANTS.

       ``(a) In General.--The Secretary may make competitive 
     grants for the acquisition of special purpose scientific 
     research equipment for use in the food and agricultural 
     sciences programs of eligible institutions described in 
     subsection (b).
       ``(b) Eligible Institutions.--The Secretary may make a 
     grant under this section to--
       ``(1) a college or university; or
       ``(2) a State cooperative institution.
       ``(c) Maximum Amount.--The amount of a grant made to an 
     eligible institution under this section may not exceed 
     $500,000.
       ``(d) Prohibition on Charge of Equipment as Indirect 
     Costs.--The cost of acquisition or depreciation of equipment 
     purchased with a grant under this section shall not be--
       ``(1) charged as an indirect cost against another Federal 
     grant; or
       ``(2) included as part of the indirect cost pool for 
     purposes of calculating the indirect cost rate of an eligible 
     institution.
       ``(e) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section such 
     sums as may be necessary for each of fiscal years 2002 
     through 2007.''.

     SEC. 7403. JOINT REQUESTS FOR PROPOSALS.

       (a) Purposes.--The purposes of this section are--
       (1) to reduce the duplication of administrative functions 
     relating to grant awards and administration among Federal 
     agencies conducting similar types of research, education, and 
     extension programs;
       (2) to maximize the use of peer review resources in 
     research, education, and extension programs; and
       (3) to reduce the burden on potential recipients that may 
     offer similar proposals to receive competitive grants under 
     different Federal programs in overlapping subject areas.
       (b) Authority.--The National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 is amended by 
     inserting after section 1473A (7 U.S.C. 3319a) the following:

     ``SEC. 1473B. JOINT REQUESTS FOR PROPOSALS.

       ``(a) In General.--In carrying out any competitive 
     agricultural research, education, or extension grant program 
     authorized under this or any other Act, the Secretary may 
     cooperate with 1 or more other Federal agencies (including 
     the National Science Foundation) in issuing joint requests 
     for proposals, awarding grants, and administering grants, for 
     similar or related research, education, or extension projects 
     or activities.
       ``(b) Administration.--
       ``(1) Secretary.--The Secretary may delegate authority to 
     issue requests for proposals, make grant awards, or 
     administer grants, in whole or in part, to a cooperating 
     Federal agency.
       ``(2) Cooperating federal agency.--The cooperating Federal 
     agency may delegate to the Secretary authority to issue 
     requests for proposals, make grant awards, or administer 
     grants, in whole or in part.
       ``(c) Regulations.--The Secretary and a cooperating Federal 
     agency may agree to make applicable to recipients of grants--
       ``(1) the post-award grant administration regulations 
     applicable to recipients of grants from the Secretary; or
       ``(2) the post-award grant administration regulations 
     applicable to recipients of grants from the cooperating 
     Federal agency.
       ``(d) Joint Peer Review Panels.--Subject to section 1413B, 
     the Secretary and a cooperating Federal agency may establish 
     joint peer review panels for the purpose of evaluating grant 
     proposals.''.

     SEC. 7404. REVIEW OF AGRICULTURAL RESEARCH SERVICE.

       (a) In General.--Not later than 90 days after the date of 
     enactment of this Act, the Secretary shall establish a task 
     force to--
       (1) conduct a review of the Agricultural Research Service; 
     and
       (2) evaluate the merits of establishing one or more 
     National Institutes focused on disciplines important to the 
     progress of food and agricultural science.
       (b) Membership.--
       (1) In general.--The Task Force shall consist of 8 members, 
     appointed by the Secretary, that--
       (A) have a broad-based background in plant, animal, and 
     agricultural sciences research, food, nutrition, 
     biotechnology, crop production methods, environmental 
     science, or related disciplines; and
       (B) are familiar with the role and infrastructure used to 
     conduct Federal and private research, including--
       (i) the Agricultural Research Service;
       (ii) the National Institutes of Health;
       (iii) the National Science Foundation;
       (iv) the National Aeronautics and Space Administration;
       (v) the Department of Energy laboratory system; or
       (vi) the Cooperative State Research, Education, and 
     Extension Service.
       (2) Private sector.--Of the members appointed under 
     paragraph (1), the Secretary shall appoint at least 6 members 
     that are members of the private sector or come from 
     institutions of higher education.
       (3) Plant and agricultural sciences research.--Of the 
     members appointed under paragraph (1), the Secretary shall 
     appoint at least 3 members that have an extensive background 
     and preeminence in the field of plant, animal, and 
     agricultural sciences research.
       (4) Chairperson.--Of the members appointed under paragraph 
     (1), the Secretary shall designate a Chairperson that has 
     significant leadership experience in educational and research 
     institutions and indepth knowledge of the research 
     enterprises of the United States.
       (5) Consultation.--Before appointing members of the Task 
     Force under this subsection, the Secretary shall consult with 
     the National Academy of Sciences and the Office of Science 
     and Technology Policy.
       (c) Duties.--The Task Force shall--
       (1) conduct a review of the purpose, efficiency, 
     effectiveness, and impact on agricultural research of the 
     Agricultural Research Service;
       (2) conduct a review and evaluation of the merits of 
     establishing one or more National Institutes (such as 
     National Institutes for Plant and Agricultural Sciences) 
     focused on disciplines important to the progress of food and 
     agricultural sciences, and, if establishment of one or more 
     National Institutes is recommended, provide further 
     recommendations to the Secretary, including the structure for 
     establishing each Institute, the multistate area location of 
     each Institute, and the amount of funding necessary to 
     establish each Institute; and
       (3) submit the reports required by subsection (d).
       (d) Reports.--Not later than 12 months after the date of 
     enactment of this Act, the Task Force shall submit to the 
     Committee on Agriculture of the House of Representatives, the 
     Committee on Agriculture, Nutrition, and Forestry of the 
     Senate, and the Secretary--
       (1) a report on the review and evaluation required under 
     subsection (c)(1); and
       (2) a report on the review and evaluation required under 
     subsection (c)(2).
       (e) Funding.--The Secretary shall use to carry out this 
     section not more than 0.1 percent of the amount of 
     appropriations available to the Agricultural Research Service 
     for fiscal year 2003.

     SEC. 7405. BEGINNING FARMER AND RANCHER DEVELOPMENT PROGRAM.

       (a) Definition of Beginning Farmer or Rancher.--In this 
     section, the term ``beginning farmer or rancher'' means a 
     person that--
       (1)(A) has not operated a farm or ranch; or
       (B) has operated a farm or ranch for not more than 10 
     years; and
       (2) meets such other criteria as the Secretary may 
     establish.
       (b) Program.--The Secretary shall establish a beginning 
     farmer and rancher development program to provide training, 
     education, outreach, and technical assistance initiatives for 
     beginning farmers or ranchers.
       (c) Grants.--
       (1) In general.--In carrying out this section, the 
     Secretary shall make competitive grants to support new and 
     established local and regional training, education, outreach, 
     and technical assistance initiatives for beginning farmers or 
     ranchers, including programs and services (as appropriate) 
     relating to--
       (A) mentoring, apprenticeships, and internships;
       (B) resources and referral;
       (C) assisting beginning farmers or ranchers in acquiring 
     land from retiring farmers and ranchers;
       (D) innovative farm and ranch transfer strategies;
       (E) entrepreneurship and business training;
       (F) model land leasing contracts;
       (G) financial management training;
       (H) whole farm planning;
       (I) conservation assistance;
       (J) risk management education;
       (K) diversification and marketing strategies;
       (L) curriculum development;
       (M) understanding the impact of concentration and 
     globalization;
       (N) basic livestock and crop farming practices;
       (O) the acquisition and management of agricultural credit;
       (P) environmental compliance;
       (Q) information processing; and
       (R) other similar subject areas of use to beginning farmers 
     or ranchers.
       (2) Eligibility.--To be eligible to receive a grant under 
     this subsection, the recipient shall be a collaborative 
     State, tribal, local, or regionally-based network or 
     partnership of public or private entities, which may 
     include--
       (A) a State cooperative extension service;
       (B) a Federal, State, or tribal agency;
       (C) a community-based and nongovernmental organization;
       (D) a college or university (including an institution 
     awarding an associate's degree) or foundation maintained by a 
     college or university; or
       (E) any other appropriate partner, as determined by the 
     Secretary.
       (3) Term of grant.--The term of a grant under this 
     subsection shall not exceed 3 years.
       (4) Matching requirement.--To be eligible to receive a 
     grant under this subsection, a recipient shall provide a 
     match in the form of cash or in-kind contributions in an 
     amount equal to 25 percent of the funds provided by the 
     grant.
       (5) Set-aside.--Not less than 25 percent of funds used to 
     carry out this subsection for a fiscal year shall be used to 
     support programs and services that address the needs of--
       (A) limited resource beginning farmers or ranchers (as 
     defined by the Secretary);
       (B) socially disadvantaged beginning farmers or ranchers 
     (as defined in section 355(e) of the Consolidated Farm and 
     Rural Development Act (7 U.S.C. 2003(e)); and
       (C) farmworkers desiring to become farmers or ranchers.
       (6) Prohibition.--A grant made under this subsection may 
     not be used for the planning, repair, rehabilitation, 
     acquisition, or construction of a building or facility.
       (7) Administrative costs.--The Secretary shall use not more 
     than 4 percent of the funds made available to carry out this 
     subsection for

[[Page H1880]]

     administrative costs incurred by the Secretary in carrying 
     out this section.
       (d) Education Teams.--
       (1) In general.--In carrying out this section, the 
     Secretary shall establish beginning farmer and rancher 
     education teams to develop curricula and conduct educational 
     programs and workshops for beginning farmers or ranchers in 
     diverse geographical areas of the United States.
       (2) Curriculum.--In promoting the development of curricula, 
     the Secretary shall, to the maximum extent practicable, 
     include modules tailored to specific audiences of beginning 
     farmers or ranchers, based on crop or regional diversity.
       (3) Composition.--In establishing an education team for a 
     specific program or workshop, the Secretary shall, to the 
     maximum extent practicable--
       (A) obtain the short-term services of specialists with 
     knowledge and expertise in programs serving beginning farmers 
     or ranchers; and
       (B) use officers and employees of the Department with 
     direct experience in programs of the Department that may be 
     taught as part of the curriculum for the program or workshop.
       (4) Cooperation.--
       (A) In general.--In carrying out this subsection, the 
     Secretary shall cooperate, to the maximum extent practicable, 
     with--
       (i) State cooperative extension services;
       (ii) Federal and State agencies;
       (iii) community-based and nongovernmental organizations;
       (iv) colleges and universities (including an institution 
     awarding an associate's degree) or foundations maintained by 
     a college or university; and
       (v) other appropriate partners, as determined by the 
     Secretary.
       (B) Cooperative agreement.--Notwithstanding chapter 63 of 
     title 31, United States Code, the Secretary may enter into a 
     cooperative agreement to reflect the terms of any cooperation 
     under subparagraph (A).
       (e) Curriculum and Training Clearinghouse.--The Secretary 
     shall establish an online clearinghouse that makes available 
     to beginning farmers or ranchers education curricula and 
     training materials and programs, which may include online 
     courses for direct use by beginning farmers or ranchers.
       (f) Stakeholder Input.--In carrying out this section, the 
     Secretary shall seek stakeholder input from--
       (1) beginning farmers and ranchers;
       (2) national, State, tribal, and local organizations and 
     other persons with expertise in operating beginning farmer 
     and rancher programs; and
       (3) the Advisory Committee on Beginning Farmers and 
     Ranchers established under section 5 of the Agricultural 
     Credit Improvement Act of 1992 (7 U.S.C. 1929 note; Public 
     Law 102-554).
       (g) Participation by Other Farmers and Ranchers.--Nothing 
     in this section prohibits the Secretary from allowing farmers 
     and ranchers who are not beginning farmers or ranchers from 
     participating in programs authorized under this section to 
     the extent that the Secretary determines that such 
     participation is appropriate and will not detract from the 
     primary purpose of educating beginning farmers and ranchers.
       (h) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section such sums as may 
     be necessary for each of fiscal years 2002 through 2007.

     SEC. 7406. SENSE OF CONGRESS REGARDING DOUBLING OF FUNDING 
                   FOR AGRICULTURAL RESEARCH.

       It is the sense of Congress that--
       (1) Federal funding for food and agricultural research has 
     been essentially constant for 2 decades, putting at risk the 
     scientific base on which food and agricultural advances have 
     been made;
       (2) the resulting increase in the relative proportion of 
     private sector, industry investments in food and agricultural 
     research has led to questions about the independence and 
     objectivity of research and outreach conducted by the Federal 
     and university research sectors; and
       (3) funding for food and agricultural research should be at 
     least doubled over the next 5 fiscal years--
       (A) to restore the balance between public and private 
     sector funding for food and agricultural research; and
       (B) to maintain the scientific base on which food and 
     agricultural advances are made.

     SEC. 7407. ORGANIC PRODUCTION AND MARKET DATA INITIATIVES.

       The Secretary shall ensure that segregated data on the 
     production and marketing of organic agricultural products is 
     included in the ongoing baseline of data collection regarding 
     agricultural production and marketing.

     SEC. 7408. INTERNATIONAL ORGANIC RESEARCH COLLABORATION.

       The Secretary, acting through the Agricultural Research 
     Service (including the National Agricultural Library) and the 
     Economic Research Service, shall facilitate access by 
     research and extension professionals, farmers, and other 
     interested persons in the United States to, and the use by 
     those persons of, organic research conducted outside the 
     United States.

     SEC. 7409. REPORT ON PRODUCERS AND HANDLERS OF ORGANIC 
                   AGRICULTURAL PRODUCTS.

       Not later than 1 year after funds are made available to 
     carry out this section, the Secretary shall submit to 
     Congress a report that--
       (1) describes--
       (A) the extent to which producers and handlers of organic 
     agricultural products are contributing to research and 
     promotion programs of the Department;
       (B) the extent to which producers and handlers of organic 
     agricultural products are surveyed for ideas for research and 
     promotion;
       (C) ways in which the programs reflect the contributions 
     made by producers and handlers of organic agricultural 
     products and directly benefit the producers and handlers; and
       (D) the implementation of initiatives that directly benefit 
     organic producers and handlers; and
       (2) evaluates industry and other proposals for improving 
     the treatment of certified organic agricultural products 
     under Federal marketing orders, including proposals to target 
     additional resources for research and promotion of organic 
     products and to differentiate between certified organic and 
     other products in new or existing volume limitations or other 
     orderly marketing requirements.

     SEC. 7410. REPORT ON GENETICALLY MODIFIED PEST-PROTECTED 
                   PLANTS.

       It is the sense of Congress that, not later than 1 year 
     after the date of enactment of this Act, the Secretary 
     should--
       (1) review the recommendations of the Committee on 
     Genetically Modified Pest-Protected Plants of the Board on 
     Agriculture and Natural Resources of the National Research 
     Council made during 2000 and the Committee on Environmental 
     Impacts Associated with Commercialization of Transgenic 
     Plants made during 2002, concerning food safety, ecological 
     research, monitoring needs for transgenic crops with plant 
     incorporated protectants, and the environmental effects of 
     transgenic plants; and
       (2) submit to the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate a report that describes actions 
     taken to implement those recommendations by agencies within 
     the Department, including agencies that develop or implement 
     programs or objectives relating to marketing, regulation, 
     food safety, research, education, or economics.

     SEC. 7411. STUDY OF NUTRIENT BANKING.

       (a) In General.--The Secretary may conduct a study to 
     evaluate nutrient banking for the purpose of enhancing the 
     health and viability of watersheds in areas with large 
     concentrations of animal producing units.
       (b) Components.--In conducting any study under subsection 
     (a), the Secretary shall evaluate the costs, needs, and means 
     by which litter may be collected and distributed outside the 
     applicable watershed to reduce potential point source and 
     nonpoint source phosphorous pollution.
       (c) Report.--The Secretary shall submit to the Committee on 
     Agriculture of the House of Representatives and the Committee 
     on Agriculture, Nutrition, and Forestry of the Senate a 
     report that describes the results of any study conducted 
     under subsection (a).

     SEC. 7412. GRANTS FOR YOUTH ORGANIZATIONS.

       Title IV of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (7 U.S.C. 7621 et seq.) (as 
     amended by section 7206(e)) is amended by adding at the end 
     the following:

     ``SEC. 410. GRANTS FOR YOUTH ORGANIZATIONS.

       ``(a) In General.--The Secretary, acting through the 
     Administrator of the Cooperative State Research, Education, 
     and Extension Service, shall make grants to the Girl Scouts 
     of the United States of America, the Boy Scouts of America, 
     the National 4-H Council, and the National FFA Organization 
     to establish pilot projects to expand the programs carried 
     out by the organizations in rural areas and small towns 
     (including, with respect to the National 4-H Council, 
     activities provided for in Public Law 107-19 (115 Stat. 
     153)).
       ``(b) Funding.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall make available $8,000,000 
     for fiscal year 2002, which shall remain available until 
     expended.
       ``(c) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section such sums as are 
     necessary for each of fiscal years 2003 through 2007.''.
                       Subtitle E--Miscellaneous

     SEC. 7501. RESIDENT INSTRUCTION AND DISTANCE EDUCATION AT 
                   INSTITUTIONS OF HIGHER EDUCATION IN UNITED 
                   STATES INSULAR AREAS.

       (a) Purpose.--It is the purpose of this subtitle to promote 
     and strengthen higher education in the food and agricultural 
     sciences at institutions of higher education (as defined in 
     section 101(a) of the Higher Education Act of 1965 (20 U.S.C. 
     1001(a))) that have demonstrable capacity to carry out 
     teaching and extension programs in food and agricultural 
     sciences and that are located in the insular areas of the 
     Commonwealth of Puerto Rico, the Virgin Islands of the United 
     States, Guam, American Samoa, the Commonwealth of the 
     Northern Mariana Islands, the Federated States of Micronesia, 
     the Republic of the Marshall Islands, or the Republic of 
     Palau by formulating and administering programs to enhance 
     teaching programs in agriculture, natural resources, 
     forestry, veterinary medicine, home economics, and 
     disciplines closely allied to the food and agriculture 
     production and delivery systems.

     SEC. 7502. DEFINITIONS.

       (a) In General.--Section 1404 of the National Agricultural 
     Research, Extension, and Teaching Policy Act of 1977 (7 
     U.S.C. 3103) is amended--
       (1) by redesignating paragraphs (10) through (17) as 
     paragraphs (11) through (18), respectively;
       (2) by inserting after paragraph (9) the following:
       ``(10) Insular area.--The term `insular area' means--
       ``(A) the Commonwealth of Puerto Rico;
       ``(B) Guam;
       ``(C) American Samoa;
       ``(D) the Commonwealth of the Northern Mariana Islands;
       ``(E) the Federated States of Micronesia;
       ``(F) the Republic of the Marshall Islands;
       ``(G) the Republic of Palau; and

[[Page H1881]]

       ``(H) the Virgin Islands of the United States.''; and
       (3) by striking paragraph (13) (as so redesignated) and 
     inserting the following:
       ``(13) State.--The term `State' means--
       ``(A) a State;
       ``(B) the District of Columbia; and
       ``(C) any insular area.''.
       (b) Effect of amendments.--The amendments made by 
     subsection (a) shall not affect any basis for distribution of 
     funds by formula (in effect on the date of enactment of this 
     Act) to--
       (1) the Federated States of Micronesia;
       (2) the Republic of the Marshall Islands; or
       (3) the Republic of Palau.

     SEC. 7503. RESIDENT INSTRUCTION AND DISTANCE EDUCATION GRANTS 
                   PROGRAM FOR INSULAR AREA INSTITUTIONS OF HIGHER 
                   EDUCATION.

       The National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 (7 U.S.C. 3101 et seq.) is amended by 
     adding at the end the following:
    ``Subtitle O--Institutions of Higher Education in Insular Areas

     ``SEC. 1489. DEFINITION.

       ``For the purposes of this subtitle, the term `eligible 
     institution' means an institution of higher education (as 
     defined in section 101(a) of the Higher Education Act of 1965 
     (20 U.S.C. 1001(a)) in an insular area that has demonstrable 
     capacity to carry out teaching and extension programs in 
     the food and agricultural sciences.

     ``SEC. 1490. DISTANCE EDUCATION GRANTS FOR INSULAR AREAS.

       ``(a) In General.--The Secretary may make competitive or 
     noncompetitive grants to eligible institutions in insular 
     areas to strengthen the capacity of such institutions to 
     carry out distance food and agricultural education programs 
     using digital network technologies.
       ``(b) Use.--Grants made under this section shall be used--
       ``(1) to acquire the equipment, instrumentation, networking 
     capability, hardware and software, digital network 
     technology, and infrastructure necessary to teach students 
     and teachers about technology in the classroom;
       ``(2) to develop and provide educational services 
     (including faculty development) to prepare students or 
     faculty seeking a degree or certificate that is approved by 
     the State or a regional accrediting body recognized by the 
     Secretary of Education;
       ``(3) to provide teacher education, library and media 
     specialist training, and preschool and teacher aid 
     certification to individuals who seek to acquire or enhance 
     technology skills in order to use technology in the classroom 
     or instructional process;
       ``(4) to implement a joint project to provide education 
     regarding technology in the classroom with a local 
     educational agency, community-based organization, national 
     nonprofit organization, or business; or
       ``(5) to provide leadership development to administrators, 
     board members, and faculty of eligible institutions with 
     institutional responsibility for technology education.
       ``(c) Limitation on Use of Grant Funds.--Funds provided 
     under this section shall not be used for the planning, 
     acquisition, construction, rehabilitation, or repair of a 
     building or facility.
       ``(d) Administration of program.--The Secretary may carry 
     out this section in a manner that recognizes the different 
     needs and opportunities for eligible institutions in the 
     Atlantic and Pacific Oceans.
       ``(e) Matching requirement.--
       ``(1) In general.--The Secretary may establish a 
     requirement that an eligible institution receiving a grant 
     under this section shall provide matching funds from non-
     Federal sources in an amount equal to not less than 50 
     percent of the grant.
       ``(2) Waivers.--If the Secretary establishes a matching 
     requirement under paragraph (1), the Secretary shall retain 
     an option to waive the requirement for an eligible 
     institution for any fiscal year if the Secretary determines 
     that the institution will be unlikely to meet the matching 
     requirement for the fiscal year.
       ``(f) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section such sums as may 
     be necessary for each of fiscal years 2002 through 2007.

     ``SEC. 1491. RESIDENT INSTRUCTION GRANTS FOR INSULAR AREAS.

       ``(a) In General.--The Secretary of Agriculture shall make 
     competitive grants to eligible institutions to--
       ``(1) strengthen institutional educational capacities, 
     including libraries, curriculum, faculty, scientific 
     instrumentation, instruction delivery systems, and student 
     recruitment and retention, in order to respond to identified 
     State, regional, national, or international education needs 
     in the food and agricultural sciences;
       ``(2) attract and support undergraduate and graduate 
     students in order to educate them in identified areas of 
     national need in the food and agriculture sciences;
       ``(3) facilitate cooperative initiatives between two or 
     more insular area eligible institutions, or between those 
     institutions and units of State Government or organizations 
     in the private sector, to maximize the development and use of 
     resources such as faculty, facilities, and equipment to 
     improve food and agricultural sciences teaching programs; and
       ``(4) conduct undergraduate scholarship programs to assist 
     in meeting national needs for training food and agricultural 
     scientists
       ``(b) Grant Requirements.--
       ``(1) The Secretary of Agriculture shall ensure that each 
     eligible institution, prior to receiving grant funds under 
     subsection (a), shall have a significant demonstrable 
     commitment to higher education programs in the food and 
     agricultural sciences and to each specific subject area for 
     which grant funds under this section are to be used.
       ``(2) The Secretary of Agriculture may require that any 
     grant awarded under this section contain provisions that 
     require funds to be targeted to meet the needs identified in 
     section 1402.
       ``(e) Authorization of appropriations.--There are 
     authorized to be appropriated such sums as are necessary for 
     each of the fiscal years 2002 through 2007 to carry out this 
     section.''.

     SEC. 7504. DECLARATION OF EXTRAORDINARY EMERGENCY AND 
                   RESULTING AUTHORITIES.

       (a) Review of Payment of Compensation.--Section 415(e) of 
     the Plant Protection Act (7 U.S.C. 7715(e)) is amended by 
     inserting before the final period the following: ``or a 
     review of longer than 60 days by any officer or employee of 
     the Federal Government other than the Secretary or the 
     designee of the Secretary''.
       (b) Review of Certain Decisions.--Section 442 of the Plant 
     Protection Act (7 U.S.C. 7772) is amended by adding at the 
     end the following new subsection:
       ``(c) Secretarial Discretion.--The action of any officer, 
     employee, or agent of the Secretary in carrying out this Act, 
     including determining the amount of and making any payment 
     authorized to be made under this title, shall not be subject 
     to a review of longer than 60 days by any officer or employee 
     of the Federal Government other than the Secretary or the 
     designee of the Secretary.''.
       (c) Methyl Bromide.--The Plant Protection Act (7 U.S.C. 
     7701 et seq.) is amended by inserting after section 418 the 
     following new section:

     ``SEC. 419. METHYL BROMIDE.

       ``(a) In General.--The Secretary, upon request of State, 
     local, or tribal authorities, shall determine whether methyl 
     bromide treatments or applications required by State, local, 
     or tribal authorities to prevent the introduction, 
     establishment, or spread of plant pests (including diseases) 
     or noxious weeds should be authorized as an official control 
     or official requirement. The Secretary shall not authorize 
     such treatments or applications unless the Secretary finds 
     there is no other registered, effective, and economically 
     feasible alternative available.
       ``(b) Methyl Bromide Alternative.--The Secretary, in 
     consultation with State, local and tribal authorities, shall 
     establish a program to identify alternatives to methyl 
     bromide for treatment and control of plant pests and weeds. 
     For uses where no registered, effective, economically 
     feasible alternatives available can currently be identified, 
     the Secretary shall initiate research programs to develop 
     alternative methods of control and treatment.
       ``(c) Registry.--Not later than 180 days after the date of 
     enactment of this section, the Secretary shall publish, and 
     thereafter maintain, a registry of State, local, and tribal 
     requirements authorized by the Secretary under this section.
       ``(d) Administration.--
       ``(1) Timeline for determination.--Upon the promulgation of 
     regulations to carry out this section, the Secretary shall 
     make the determination required by subsection (a) not later 
     than 90 days after receiving the request for such a 
     determination.
       ``(2) Construction.--Nothing in this section shall be 
     construed to alter or modify the authority of the 
     Administrator of the Environmental Protection Agency or to 
     provide any authority to the Secretary of Agriculture under 
     the Clean Air Act or regulations promulgated under the Clean 
     Air Act.''.

     SEC. 7505. AGRICULTURAL BIOTECHNOLOGY RESEARCH AND 
                   DEVELOPMENT FOR DEVELOPING COUNTRIES.

       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. 411. AGRICULTURAL BIOTECHNOLOGY RESEARCH AND 
                   DEVELOPMENT FOR DEVELOPING COUNTRIES.

       ``(a) Eligible entity.--In this section, the term `eligible 
     entity' means--
       ``(A) an institution of higher education that offers a 
     curriculum in agriculture or the biosciences;
       ``(B) a nonprofit organization; or
       ``(C) a consortium of for-profit institutions and 
     agricultural research institutions.
       ``(b) Grant Program.--
       ``(1) In general.--The Secretary (acting through the 
     Foreign Agricultural Service) shall establish and administer 
     a program to make competitive grants to eligible entities to 
     develop agricultural biotechnology for developing countries.
       ``(2) Use of funds.--Funds provided to an eligible entity 
     under this section may be used for projects that use 
     biotechnology to--
       ``(A) enhance the nutritional content of agricultural 
     products that can be grown in developing countries;
       ``(B) increase the yield and safety of agricultural 
     products that can be grown in developing countries;
       ``(C) increase the yield of agricultural products that are 
     drought- and stress-resistant and that can be grown in 
     developing countries;
       ``(D) extend the growing range of crops that can be grown 
     in developing countries;
       ``(E) enhance the shelf-life of fruits and vegetables grown 
     in developing countries;
       ``(F) develop environmentally sustainable agricultural 
     products that can be grown in developing countries; and
       ``(G) develop vaccines to immunize against life-threatening 
     illnesses and other medications that can be administered by 
     consuming genetically-engineered agricultural products.
       ``(c) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as may be necessary 
     to carry out this section for each of fiscal years 2002 
     through 2007.''.

[[Page H1882]]

     SEC. 7506. LAND ACQUISITION AUTHORITY, NATIONAL PEANUT 
                   RESEARCH LABORATORY, DAWSON, GEORGIA.

       The limitation on the authority of the Agricultural 
     Research Service to acquire lands by purchase using funds 
     appropriated under the heading Agricultural Research Service-
     salaries and expenses in the Agriculture, Rural Development, 
     Food and Drug Administration, and Related Agencies 
     Appropriations Act, 2002 (Public Law 107-76; 115 Stat. 708), 
     shall not apply to the purchase of land for a research farm 
     for the National Peanut Research Laboratory in Dawson, 
     Georgia, for which a lease with an option to purchase has 
     been entered into before the date of enactment of this Act.
                          TITLE VIII--FORESTRY
        Subtitle A--Cooperative Forestry Assistance Act of 1978

     SEC. 8001. REPEAL OF FORESTRY INCENTIVES PROGRAM AND 
                   STEWARDSHIP INCENTIVE PROGRAM.

       (a) Repeal.--The Cooperative Forestry Assistance Act of 
     1978 is amended by striking section 4 (16 U.S.C. 2103) and 
     section 6 (16 U.S.C. 2103b).
       (b) Use of Remaining Funds.--Notwithstanding the amendment 
     made by subsection (a), the Secretary of Agriculture may use 
     funds appropriated for fiscal year 2002 for the forestry 
     incentives program or the stewardship incentive program, but 
     not expended before the date of enactment of this Act, to 
     carry out sections 4 and 6 of the Cooperative Forestry 
     Assistance Act of 1978, as in effect on the date before the 
     date of enactment of this Act.

     SEC. 8002. ESTABLISHMENT OF FOREST LAND ENHANCEMENT PROGRAM.

       (a) Purposes.--The purposes of this section are--
       (1) to strengthen the commitment of the Secretary of 
     Agriculture to sustainable forest management to enhance the 
     productivity of timber, fish and wildlife habitat, soil and 
     water quality, wetland, recreational resources, and aesthetic 
     values of forest land; and
       (2) to establish a coordinated and cooperative Federal, 
     State, and local sustainable forestry program for the 
     establishment, management, maintenance, enhancement, and 
     restoration of forests on nonindustrial private forest land.
       (b) Forest Land Enhancement Program.--The Cooperative 
     Forestry Assistance Act of 1978 is amended by inserting after 
     section 3 (16 U.S.C. 2102) the following:

     ``SEC. 4. FOREST LAND ENHANCEMENT PROGRAM.

       ``(a) Establishment.--
       ``(1) In general.--The Secretary of Agriculture shall 
     establish a forest land enhancement program--
       ``(A) to provide financial assistance to State foresters; 
     and
       ``(B) to encourage the long-term sustainability of 
     nonindustrial private forest lands in the United States by 
     assisting the owners of nonindustrial private forest lands, 
     through State foresters, in more actively managing the 
     nonindustrial private forest lands and related resources of 
     those owners through the use of State, Federal, and private 
     sector resource management expertise, financial assistance, 
     and educational programs.
       ``(2) Coordination and consultation.--The Secretary, acting 
     through State foresters, shall implement the program--
       ``(A) in coordination with the State Forest Stewardship 
     Coordinating Committees; and
       ``(B) in consultation with other Federal, State, and local 
     natural resource management agencies, institutions of higher 
     education, and a broad range of private sector interests.
       ``(b) Program Objectives.--In implementing the program, the 
     Secretary shall target resources to achieve the following 
     objectives:
       ``(1) Investing in practices to establish, restore, 
     protect, manage, maintain, and enhance the health and 
     productivity of the nonindustrial private forest lands in the 
     United States for timber, habitat for flora and fauna, soil, 
     water, and air quality, wetlands, and riparian buffers.
       ``(2) Ensuring that afforestation, reforestation, 
     improvement of poorly stocked stands, timber stand 
     improvement, practices necessary to improve seedling growth 
     and survival, and growth enhancement practices occur where 
     needed to enhance and sustain the long-term productivity of 
     timber and nontimber forest resources to help meet future 
     public demand for all forest resources and provide 
     environmental benefits.
       ``(3) Reducing the risks and helping restore, recover, and 
     mitigate the damage to forests caused by fire, insects, 
     invasive species, disease, and damaging weather.
       ``(4) Increasing and enhancing carbon sequestration 
     opportunities.
       ``(5) Enhancing implementation of agroforestry practices.
       ``(6) Maintaining and enhancing the forest landbase and 
     leverage State and local financial and technical assistance 
     to owners that promote the same conservation and 
     environmental values.
       ``(7) Preserving the aesthetic quality of nonindustrial 
     private forest lands and providing opportunities for outdoor 
     recreation.
       ``(c) State Priority Plan.--
       ``(1) Development.--The State Forester and State Forest 
     Stewardship Coordinating Committee of a State shall jointly 
     develop and submit to the Secretary a State priority plan 
     that is intended to promote forest management objectives in 
     that State.
       ``(2) Report.--Not later than September 30, 2006, each 
     State that implemented a State priority plan shall submit to 
     the Secretary a report describing the status of all 
     activities and practices funded under the program as of that 
     date.
       ``(d) Owner Eligibility for Assistance.--
       ``(1) Eligibility criteria.--To be eligible for cost-share 
     assistance under the program, an owner of nonindustrial 
     private forest lands shall agree--
       ``(A) to develop and implement, in cooperation with a State 
     forester, another State official, or a professional resources 
     manager, a management plan that--
       ``(i) except as provided in paragraph (2) or (3), provides 
     for the treatment of not more than 1,000 acres of 
     nonindustrial private forest lands;
       ``(ii) is approved by the State forester; and
       ``(iii) addresses site specific activities and practices; 
     and
       ``(B) to implement approved activities and practices in a 
     manner consistent with the management plan for a period of 
     not less than 10 years, unless the State forester approves a 
     modification to the plan.
       ``(2) Public benefit exception.--The Secretary may increase 
     the acreage limitation specified in paragraph (1)(A)(i) to 
     not more than 5,000 acres for an owner of nonindustrial 
     private forest lands if the Secretary, in consultation with 
     the State forester, determines that significant public 
     benefits will accrue as a result of the provision of cost-
     share assistance under the program for the treatment of the 
     additional acreage.
       ``(3) Plan development exception.--An owner may receive 
     cost-share assistance under the program for the purpose of 
     developing a management plan under subsection (e) that 
     provides for the treatment of acreage in excess of the 
     acreage limitations specified in paragraphs (1)(A)(i) and 
     (2), except that the owner's eligibility for cost-share 
     assistance to implement approved activities and practices 
     under the management plan remains subject to the acreage 
     limitation specified in paragraph (1)(A)(i) or, if the 
     Secretary makes the determination described in paragraph (2), 
     the acreage limitation specified in that paragraph.
       ``(e) Management Plan.--
       ``(1) Submission and content.--An owner of nonindustrial 
     private forest lands that seeks to participate in the program 
     shall submit to the State forester of the State in which the 
     lands are located a management plan that--
       ``(A) identifies and describes projects and activities to 
     be carried out by the owner to protect or enhance soil, 
     water, air, range and aesthetic quality, recreation, timber, 
     water, wetland, or fish and wildlife resources on the lands 
     in a manner that is compatible with the objectives of the 
     owner;
       ``(B) addresses any criteria established by the State and 
     the applicable Committee; and
       ``(C) meets the other requirements of this section.
       ``(2) Lands covered.--At a minimum, the management plan 
     shall apply to those portions of the nonindustrial private 
     forest lands of the owner on which any project or activity 
     funded under the program will be carried out. In a case in 
     which a project or activity may affect acreage outside the 
     portion of the land on which the project or activity is 
     carried out, the management plan shall apply to all lands of 
     the owner that are in forest cover and may be affected by the 
     project or activity.
       ``(f) Approved Activities.--
       ``(1) State list.--The Secretary shall develop for each 
     State a list of approved forest activities and practices 
     eligible for cost-share assistance that meets the purposes of 
     the program. The Secretary shall develop the list for a State 
     in consultation with the State forester and the Committee for 
     that State.
       ``(2) Types of activities.--Approved activities and 
     practices under paragraph (1) may consist of activities and 
     practices for the following purposes:
       ``(A) The establishment, management, maintenance, and 
     restoration of forests for shelterbelts, windbreaks, 
     aesthetic quality, and other conservation purposes.
       ``(B) The sustainable growth and management of forests for 
     timber production.
       ``(C) The restoration, use, and enhancement of forest 
     wetland and riparian areas.
       ``(D) The protection of water quality and watersheds 
     through--
       ``(i) the planting of trees in riparian areas; and
       ``(ii) the enhanced management and maintenance of native 
     vegetation on land vital to water quality.
       ``(E) The management, maintenance, restoration, or 
     development of habitat for plants, fish, and wildlife.
       ``(F) The control, detection, monitoring, and prevention of 
     the spread of invasive species and pests on nonindustrial 
     private forest lands.
       ``(G) The restoration of nonindustrial private forest land 
     affected by invasive species and pests.
       ``(H) The conduct of other management activities, such as 
     the reduction of hazardous fuels, that reduce the risks to 
     forests posed by, and that restore, recover, and mitigate the 
     damage to forests caused by, fire or any other catastrophic 
     event, as determined by the Secretary.
       ``(I) The development of management plans;
       ``(J) The conduct of energy conservation and carbon 
     sequestration activities.
       ``(K) The conduct of other activities approved by the 
     Secretary, in consultation with the State forester and the 
     appropriate Committees.
       ``(g) Reimbursement of Eligible Activities.--
       ``(1) In general.--In the case of an eligible owner that 
     has an approved management plan, the Secretary shall share 
     the cost of implementing the approved activities and 
     practices that the Secretary determines are appropriate.
       ``(2) Rate.--The Secretary shall determine the appropriate 
     reimbursement rate for cost-share payments under paragraph 
     (1) and the schedule for making those payments.
       ``(3) Maximum cost share.--The Secretary shall not make 
     cost-share payments under this subsection to an owner in an 
     amount in excess of 75 percent, or a lower percentage as 
     determined by the State forester, of the total cost to

[[Page H1883]]

     the owner to implement the approved activities and practices 
     under the management plan.
       ``(4) Aggregate payment limit.--The Secretary shall 
     determine the maximum aggregate amount of cost-share payments 
     that an owner may receive under the program.
       ``(5) Consultation.--The Secretary shall make 
     determinations under this subsection in consultation with the 
     State forester.
       ``(h) Recapture.--
       ``(1) In general.--The Secretary shall establish and 
     implement a mechanism to recapture payments made to an owner 
     in the event that the owner fails to implement an approved 
     activity or practice specified in the management plan for 
     which the owner received cost-share payments.
       ``(2) Additional remedy.--The remedy provided in paragraph 
     (1) is in addition to any other remedy available to the 
     Secretary.
       ``(i) Distribution of Cost-Share Funds.--The Secretary, 
     acting through the State foresters, shall distribute funds 
     available for cost sharing under the program only after 
     giving appropriate consideration to the following factors:
       ``(1) The public benefits that would result from the 
     distribution.
       ``(2) The total acreage of nonindustrial private forest 
     lands in each State.
       ``(3) The potential productivity of those lands, as 
     determined by the Secretary.
       ``(4) The number of owners eligible for cost sharing in 
     each State.
       ``(5) The opportunities to enhance nontimber resources on 
     those lands, including--
       ``(A) the protection of riparian buffers and forest 
     wetland;
       ``(B) the preservation of fish and wildlife habitat;
       ``(C) the enhancement of soil, air, and water quality; and
       ``(D) the preservation of aesthetic quality and 
     opportunities for outdoor recreation.
       ``(6) The anticipated demand for timber and nontimber 
     resources in each State.
       ``(7) The need to improve forest health to minimize the 
     damaging effects of catastrophic fire, insects, disease, or 
     weather.
       ``(8) The need and demand for agroforestry practices in 
     each State.
       ``(9) The need to maintain and enhance the forest landbase.
       ``(10) The need for afforestation, reforestation, and 
     timber stand improvement.
       ``(j) Availability of Funds.--The Secretary shall use 
     $100,000,000 of funds of the Commodity Credit Corporation to 
     carry out the Program during the period beginning on the date 
     of enactment of the Farm Security and Rural Investment Act of 
     2002 and ending on September 30, 2007.
       ``(k) Definitions.--In this section:
       ``(1) Nonindustrial private forest lands.--The term 
     `nonindustrial private forest lands' means rural lands, as 
     determined by the Secretary, that--
       ``(A) have existing tree cover or are suitable for growing 
     trees; and
       ``(B) are owned by any nonindustrial private individual, 
     group, association, corporation, Indian tribe, or other 
     private legal entity so long as the individual, group, 
     association, corporation, tribe, or entity has definitive 
     decision-making authority over the lands.
       ``(2) Committee.--The terms `State Forest Stewardship 
     Coordinating Committee' and `Committee' means a State Forest 
     Stewardship Coordinating Committee established under section 
     19(b).
       ``(3) Indian tribe.--The term `Indian tribe' has the 
     meaning given the term in section 4 of the Indian Self-
     Determination and Education Assistance Act (25 U.S.C. 450b).
       ``(4) Owner.--The term `owner' means an owner of 
     nonindustrial private forest land.
       ``(5) Program.--The term `program' means the forest land 
     enhancement program established by this section.
       ``(6) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture.
       ``(7) State forester.--The term `State forester' means the 
     director or other head of a State Forestry Agency or 
     equivalent State official.''.
       (c) Conforming Amendment.--Section 246(b)(2) of the 
     Department of Agriculture Reorganization Act of 1994 (7 
     U.S.C. 6962(b)(2)) is amended by striking ``forestry 
     incentive program'' and inserting ``forest land enhancement 
     program''.

     SEC. 8003. ENHANCED COMMUNITY FIRE PROTECTION.

       (a) Findings.--Congress finds the following:
       (1) The severity and intensity of wildland fires has 
     increased dramatically over the past few decades as a result 
     of past fire and land management policies.
       (2) The record 2000 fire season is a prime example of what 
     can be expected if action is not taken.
       (3) Wildland fires threaten not only the forested resources 
     of the United States, but also the thousands of communities 
     intermingled with the wildlands in the wildland-urban 
     interface.
       (4) The National Fire Plan, if implemented to achieve 
     appropriate priorities, is the proper, coordinated, and most 
     effective means to address the issue of wildfires.
       (5) While adequate authorities exist to tackle the wildfire 
     issues at the landscape level on Federal lands, there is 
     limited authority to take action on most private lands, and 
     the largest threat to life and property exists on private 
     lands.
       (6) There is a significant Federal interest in enhancing 
     community protection from wildfire.
       (b) Enhanced Protection.--The Cooperative Forestry 
     Assistance Act of 1978 is amended by inserting after section 
     10 (16 U.S.C. 2106) the following:

     ``SEC. 10A. ENHANCED COMMUNITY FIRE PROTECTION.

       ``(a) Cooperative Management Related to Wildfire Threats.--
     The Secretary may cooperate with State foresters and 
     equivalent State officials in the management of lands in the 
     United States for the following purposes:
       ``(1) Aid in wildfire prevention and control.
       ``(2) Protect communities from wildfire threats.
       ``(3) Enhance the growth and maintenance of trees and 
     forests that promote overall forest health.
       ``(4) Ensure the continued production of all forest 
     resources, including timber, outdoor recreation 
     opportunities, wildlife habitat, and clean water, through 
     conservation of forest cover on watersheds, shelterbelts, and 
     windbreaks.
       ``(b) Community and Private Land Fire Assistance Program.--
       ``(1) Establishment; purpose.--The Secretary shall 
     establish a Community and Private Land Fire Assistance 
     program (in this subsection referred to as the `Program')--
       ``(A) to focus the Federal role in promoting optimal 
     firefighting efficiency at the Federal, State, and local 
     levels;
       ``(B) to augment Federal projects that establish landscape 
     level protection from wildfires;
       ``(C) to expand outreach and education programs to 
     homeowners and communities about fire prevention; and
       ``(D) to establish space around homes and property of 
     private landowners that is defensible against wildfires.
       ``(2) Administration and implementation.--The Program shall 
     be administered by the Forest Service and implemented through 
     State foresters or equivalent State officials.
       ``(3) Components.--In coordination with existing 
     authorities under this Act, the Secretary, in consultation 
     with the State forester or equivalent State official, may 
     undertake on non-Federal lands--
       ``(A) fuel hazard mitigation and prevention;
       ``(B) invasive species management;
       ``(C) multiresource wildfire planning;
       ``(D) community protection planning;
       ``(E) community and landowner education enterprises, 
     including the program known as FIREWISE;
       ``(F) market development and expansion;
       ``(G) improved wood utilization; and
       ``(H) special restoration projects.
       ``(4) Consent required.--Program activities undertaken by 
     the Secretary on non-Federal lands shall be undertaken only 
     with the consent of the owner of the lands.
       ``(5) Considerations.--The Secretary shall use persons in 
     the local community wherever possible to carry out projects 
     under the Program.
       ``(c) Consultation.--In carrying out this section, the 
     Secretary shall consult with the Administrator of the United 
     States Fire Administration, the Director of the National 
     Institute of Standards and Technology, and the heads of other 
     Federal agencies, as necessary.
       ``(d) Authorization of Appropriations.--There are hereby 
     authorized to be appropriated to the Secretary to carry out 
     this section--
       (1) $35,000,000 for each of fiscal years 2002 through 2007; 
     and
       (2) such sums as are necessary for fiscal years 
     thereafter.''.
                  Subtitle B--Amendments to Other Laws

     SEC. 8101. SUSTAINABLE FORESTRY OUTREACH INITIATIVE; 
                   RENEWABLE RESOURCES EXTENSION ACTIVITIES.

       (a) Sustainable Forestry Outreach Initiative.--The 
     Renewable Resources Extension Act of 1978 is amended by 
     inserting after section 5A (16 U.S.C. 1674a) the following:

     ``SEC. 5B. SUSTAINABLE FORESTRY OUTREACH INITIATIVE.

       ``The Secretary shall establish a program, to be known as 
     the `Sustainable Forestry Outreach Initiative', to educate 
     landowners concerning the following:
       ``(1) The value and benefits of practicing sustainable 
     forestry.
       ``(2) The importance of professional forestry advice in 
     achieving sustainable forestry objectives.
       ``(3) The variety of public and private sector resources 
     available to assist the landowners in planning for and 
     practicing sustainable forestry.''.
       (b) Renewable Resources Extension Activities.--
       (1) Authorization of appropriations.--Section 6 of the 
     Renewable Resources Extension Act of 1978 (16 U.S.C. 1675) is 
     amended by striking the first sentence and inserting the 
     following: ``There is authorized to be appropriated to carry 
     out this Act $30,000,000 for each of fiscal years 2002 
     through 2007.''.
       (2) Termination date.--Section 8 of the Renewable Resources 
     Extension Act of 1978 (16 U.S.C. 1671 note; Public Law 95-
     306) is amended by striking ``2000'' and inserting ``2007''.

     SEC. 8102. OFFICE OF INTERNATIONAL FORESTRY.

       Section 2405(d) of the Global Climate Change Prevention Act 
     of 1990 (7 U.S.C. 6704(d)) is amended by striking ``2002'' 
     and inserting ``2007''.
                  Subtitle C--Miscellaneous Provisions

     SEC. 8201. MCINTIRE-STENNIS COOPERATIVE FORESTRY RESEARCH 
                   PROGRAM.

       It is the sense of Congress to reaffirm the importance of 
     Public Law 87-788 (16 U.S.C. 582a et seq.), commonly known as 
     the ``McIntire-Stennis Cooperative Forestry Act''.
                            TITLE IX--ENERGY

     SEC. 9001. DEFINITIONS.

       In this title:
       (1) Administrator.--The term ``Administrator'' means the 
     Administrator of the Environmental Protection Agency.
       (2) Biobased product.--The term ``biobased product'' means 
     a product determined by the

[[Page H1884]]

     Secretary to be a commercial or industrial product (other 
     than food or feed) that is composed, in whole or in 
     significant part, of biological products or renewable 
     domestic agricultural materials (including plant, animal, and 
     marine materials) or forestry materials.
       (3) Biomass.--
       (A) In general.--The term ``biomass'' means any organic 
     material that is available on a renewable or recurring basis.
       (B) Inclusions.--The term ``biomass'' includes--
       (i) agricultural crops;
       (ii) trees grown for energy production;
       (iii) wood waste and wood residues;
       (iv) plants (including aquatic plants and grasses);
       (v) residues;
       (vi) fibers;
       (vii) animal wastes and other waste materials; and
       (viii) fats, oils, and greases (including recycled fats, 
     oils, and greases).
       (C) Exclusions.--The term ``biomass'' does not include--
       (i) paper that is commonly recycled; or
       (ii) unsegregated solid waste.
       (4) Renewable energy.--The term ``renewable energy'' means 
     energy derived from--
       (A) a wind, solar, biomass, or geothermal source; or
       (B) hydrogen derived from biomass or water using an energy 
     source described in subparagraph (A).
       (5) Rural small business.--The term ``rural small 
     business'' has the meaning that the Secretary shall prescribe 
     by regulation.
       (6) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.

     SEC. 9002. FEDERAL PROCUREMENT OF BIOBASED PRODUCTS.

       (a) Application of Section.--Except as provided in 
     subsection (c), each Federal agency shall comply with the 
     requirements set forth in this section and any regulations 
     issued under this section, with respect to any purchase or 
     acquisition of a procurement item where the purchase price of 
     the item exceeds $10,000 or where the quantity of such items 
     or of functionally equivalent items purchased or acquired in 
     the course of the preceding fiscal year was $10,000 or more.
       (b) Procurement Subject to Other Law.--Any procurement, by 
     any Federal agency, which is subject to regulations of the 
     Administrator under section 6002 of the Solid Waste Disposal 
     Act (42 U.S.C. 6962), shall not be subject to the 
     requirements of this section to the extent that such 
     requirements are inconsistent with such regulations.
       (c) Procurement Preference.--(1) Except as provided in 
     paragraph (2), after the date specified in applicable 
     guidelines prepared pursuant to subsection (e) of this 
     section, each Federal agency which procures any items 
     designated in such guidelines shall, in making procurement 
     decisions, give preference to such items composed of the 
     highest percentage of biobased products practicable, 
     consistent with maintaining a satisfactory level of 
     competition, considering such guidelines.
       (2) Agency flexibility.--Notwithstanding paragraph (1), an 
     agency may decide not to procure such items if the agency 
     determines that the items--
       (A) are not reasonably available within a reasonable period 
     of time;
       (B) fail to meet the performance standards set forth in the 
     applicable specifications or fail to meet the reasonable 
     performance standards of the procuring agencies; or
       (C) are available only at an unreasonable price.
         (3) After the date specified in any applicable guidelines 
     prepared pursuant to subsection (e) of this section, 
     contracting offices shall require that, with respect to 
     biobased products, vendors certify that the biobased products 
     to be used in the performance of the contract will comply 
     with the applicable specifications or other contractual 
     requirements.
       (d) Specifications.--All Federal agencies that have the 
     responsibility for drafting or reviewing specifications for 
     procurement items procured by Federal agencies shall, within 
     one year after the date of publication of applicable 
     guidelines under subsection (e), or as otherwise specified in 
     such guidelines, assure that such specifications require the 
     use of biobased products consistent with the requirements of 
     this section.
       (e) Guidelines.--
       (1) In general.--The Secretary, after consultation with the 
     Administrator, the Administrator of General Services, and the 
     Secretary of Commerce (acting through the Director of the 
     National Institute of Standards and Technology), shall 
     prepare, and from time to time revise, guidelines for the use 
     of procuring agencies in complying with the requirements of 
     this section. Such guidelines shall--
       (A) designate those items which are or can be produced with 
     biobased products and whose procurement by procuring agencies 
     will carry out the objectives of this section;
       (B) set forth recommended practices with respect to the 
     procurement of biobased products and items containing such 
     materials and with respect to certification by vendors of the 
     percentage of biobased products used; and
       (C) provide information as to the availability, relative 
     price, performance, and environmental and public health 
     benefits, of such materials and items and where appropriate 
     shall recommend the level of biobased material to be 
     contained in the procured product.
       (2) Considerations.--In making the designation under 
     paragraph (1)(A), the Secretary shall, at a minimum, 
     consider--
       (A) the availability of such items; and
       (B) the economic and technological feasibility of using 
     such items, including life cycle costs.
       (3) Final guidelines.--The Secretary shall prepare final 
     guidelines under this section within 180 days after the date 
     of enactment of this Act.
       (f) Office of Federal Procurement Policy.--The Office of 
     Federal Procurement Policy, in cooperation with the 
     Secretary, shall implement the requirements of this section. 
     It shall be the responsibility of the Office of Federal 
     Procurement Policy to coordinate this policy with other 
     policies for Federal procurement to implement the 
     requirements of this section, and, every two years beginning 
     in 2003, to report to the Congress on actions taken by 
     Federal agencies and the progress made in the implementation 
     of this section, including agency compliance with subsection 
     (d).
       (g) Procurement Program.--(1) Within one year after the 
     date of publication of applicable guidelines under subsection 
     (e), each Federal agency shall develop a procurement program 
     which will assure that items composed of biobased products 
     will be purchased to the maximum extent practicable and which 
     is consistent with applicable provisions of Federal 
     procurement law.
       (2) Each procurement program required under this subsection 
     shall, at a minimum, contain--
       (A) a biobased products preference program;
       (B) an agency promotion program to promote the preference 
     program adopted under subparagraph (A); and
       (C) annual review and monitoring of the effectiveness of an 
     agency's procurement program.
       (3) In developing the preference program, the following 
     options shall be considered for adoption:
       (A) Case-by-case policy development.--Subject to the 
     limitations of subsection (c)(2) (A) through (C), a policy of 
     awarding contracts to the vendor offering an item composed of 
     the highest percentage of biobased products practicable. 
     Subject to such limitations, agencies may make an award to a 
     vendor offering items with less than the maximum biobased 
     products content.
       (B) Minimum content standards.--Minimum biobased products 
     content specifications which are set in such a way as to 
     assure that the biobased products content required is 
     consistent with the requirements of this section, without 
     violating the limitations of subsection (c)(2) (A) through 
     (C).

     Federal agencies shall adopt one of the options set forth in 
     subparagraphs (A) and (B) or a substantially equivalent 
     alternative, for inclusion in the procurement program.
       (h) Labeling.--
       (1) In general.--The Secretary, in consultation with the 
     Administrator, shall establish a voluntary program under 
     which the Secretary authorizes producers of biobased products 
     to use the label ``U.S.D.A. Certified Biobased Product''.
       (2) Eligibility criteria.--Within one year after the date 
     of enactment of this Act, the Secretary, in consultation with 
     the Administrator, shall issue criteria for determining which 
     products may qualify to receive the label under paragraph 
     (1). The criteria shall encourage the purchase of products 
     with the maximum biobased content, and should, to the maximum 
     extent possible, be consistent with the guidelines issued 
     under subsection (e).
       (3) Use of the label.--The Secretary shall ensure that the 
     label referred to in paragraph (1) is used only on products 
     that meet the criteria issued pursuant to paragraph (2).
       (4) Recognition.--The Secretary shall establish a voluntary 
     program to recognize Federal agencies and private entities 
     that use a substantial amount of biobased products.
       (i) Limitation.--Nothing in this section shall apply to the 
     procurement of motor vehicle fuels or electricity.
       (j) Funding.--
       (1) Authorization of appropriations.--There are authorized 
     to be appropriated such sums as may be necessary to carry out 
     this section.
       (2) Funding for testing of biobased products.--
       (A) In general.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall use $1,000,000 for each of 
     fiscal years 2002 through 2007 to support testing of biobased 
     products to carry out this section.
       (B) Use of funds.--Amounts made available under 
     subparagraph (A) may be used to support contracts or 
     cooperative agreements with entities that have experience and 
     special skills to conduct such testing.
       (C) Priority.--At the discretion of the Secretary, the 
     Secretary may give priority to the testing of products for 
     which private sector firms provide cost sharing for the 
     testing.

     SEC. 9003. BIOREFINERY DEVELOPMENT GRANTS.

       (a) Purpose.--The purpose of this section is to assist in 
     the development of new and emerging technologies for the use 
     of biomass, including lignocellulosic biomass, so as to--
       (1) develop transportation and other fuels, chemicals, and 
     energy from renewable sources;
       (2) increase the energy independence of the United States;
       (3) provide beneficial effects on conservation, public 
     health, and the environment;
       (4) diversify markets for raw agricultural and forestry 
     products; and
       (5) create jobs and enhance the economic development of the 
     rural economy.
       (b) Definitions.--In this section:
       (1) Advisory committee.--The term ``Advisory Committee'' 
     means the Biomass Research and Development Technical Advisory 
     Committee established by section 306 of the Biomass Research 
     and Development Act of 2000 (7 U.S.C. 7624 note; Public Law 
     106-224).
       (2) Biorefinery.--The term ``biorefinery'' means equipment 
     and processes that--
       (A) convert biomass into fuels and chemicals; and

[[Page H1885]]

       (B) may produce electricity.
       (3) Board.--The term ``Board'' means the Biomass Research 
     and Development Board established by section 305 of the 
     Biomass Research and Development Act of 2000 (7 U.S.C. 7624 
     note; Public Law 106-224).
       (4) Indian tribe.--The term ``Indian tribe'' has the 
     meaning given the term in section 4 of the Indian Self-
     Determination and Education Assistance Act (25 U.S.C. 450b).
       (c) Grants.--The Secretary shall award grants to eligible 
     entities to assist in paying the cost of development and 
     construction of biorefineries to carry out projects to 
     demonstrate the commercial viability of 1 or more processes 
     for converting biomass to fuels or chemicals.
       (d) Eligible Entities.--An individual, corporation, farm 
     cooperative, association of farmers, national laboratory, 
     institution of higher education (as defined in section 101 of 
     the Higher Education Act of 1965 (20 U.S.C. 1001)), State or 
     local energy agency or office, Indian tribe, or consortium 
     comprised of any of those entities shall be eligible to 
     receive a grant under subsection (c).
       (e) Competitive Basis for Awards.--
       (1) In general.--The Secretary shall award grants under 
     subsection (c) on a competitive basis after consulting the 
     Board and Advisory Committee.
       (2) Selection criteria.--
       (A) In general.--In selecting projects to receive grants 
     under subsection (c), the Secretary--
       (i) shall select projects based on the likelihood that the 
     projects will demonstrate the commercial viability of a new 
     and emerging process for converting biomass into fuels, 
     chemicals, or energy; and
       (ii) may consider the likelihood that the projects will 
     produce electricity.
       (B) Factors.--The factors to be considered under 
     subparagraph (A) may include--
       (i) the potential market for the product or products;
       (ii) the level of financial participation by the 
     applicants;
       (iii) the availability of adequate funding from other 
     sources;
       (iv) the beneficial impact on resource conservation, public 
     health, and the environment;
       (v) the participation of producer associations and 
     cooperatives;
       (vi) the timeframe in which the project will be 
     operational;
       (vii) the potential for rural economic development;
       (viii) the participation of multiple eligible entities; and
       (ix) the potential for developing advanced industrial 
     biotechnology approaches.
       (f) Cost Sharing.--
       (1) In general.--The amount of a grant for a project 
     awarded under subsection (c) shall not exceed 30 percent of 
     the cost of the project.
       (2) Form of grantee share.--
       (A) In general.--The grantee share of the cost of a project 
     may be made in the form of cash or the provision of services, 
     material, or other in-kind contributions.
       (B) Limitation.--The amount of the grantee share of the 
     cost of a project that is made in the form of the provision 
     of services, material, or other in-kind contributions shall 
     not exceed 25 percent of the amount of the grantee share 
     determined under paragraph (1).
       (g) Consultation.--In carrying out this section, the 
     Secretary shall consult with the Secretary of Energy.
       (h) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section for each of fiscal years 2002 through 2007.

     SEC. 9004. BIODIESEL FUEL EDUCATION PROGRAM.

       (a) Establishment.--The Secretary shall, under such terms 
     and conditions as are appropriate, make competitive grants to 
     eligible entities to educate governmental and private 
     entities that operate vehicle fleets, other interested 
     entities (as determined by the Secretary), and the public 
     about the benefits of biodiesel fuel use.
       (b) Eligible Entities.--To receive a grant under subsection 
     (a), an entity--
       (1) shall be a nonprofit organization or institution of 
     higher education (as defined in section 101 of the Higher 
     Education Act of 1965 (20 U.S.C. 1001));
       (2) shall have demonstrated knowledge of biodiesel fuel 
     production, use, or distribution; and
       (3) shall have demonstrated the ability to conduct 
     educational and technical support programs.
       (c) Consultation.--In carrying out this section, the 
     Secretary shall consult with the Secretary of Energy.
       (d) Funding.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall make available to carry out 
     this section $1,000,000 for each of fiscal years 2003 through 
     2007.

     SEC. 9005. ENERGY AUDIT AND RENEWABLE ENERGY DEVELOPMENT 
                   PROGRAM.

       (a) In General.--The Secretary shall make competitive 
     grants to eligible entities to carry out a program to assist 
     farmers, ranchers, and rural small businesses in becoming 
     more energy efficient and in using renewable energy 
     technology and resources.
       (b) Eligible Entities.--Entities eligible to carry out a 
     program under subsection (a) are--
       (1) a State energy or agricultural office;
       (2) a regional or State-based energy organization or energy 
     organization of an Indian tribe (as defined in section 4 of 
     the Indian Self-Determination and Education Assistance Act 
     (25 U.S.C. 450b));
       (3) a land-grant college or university (as defined in 
     section 1404 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103)) 
     or other institution of higher education (as defined in 
     section 101 of the Higher Education Act of 1965 (20 U.S.C. 
     1001));
       (4) a rural electric cooperative or utility;
       (5) a nonprofit organization; and
       (6) any other entity, as determined by the Secretary.
       (c) Merit Review.--
       (1) Merit review process.--The Secretary shall establish a 
     merit review process to review applications for grants under 
     subsection (a) that uses the expertise of other Federal 
     agencies, industry, and nongovernmental organizations.
       (2) Selection criteria.--In reviewing applications of 
     eligible entities to receive grants under subsection (a), the 
     Secretary shall consider--
       (A) the ability and expertise of the eligible entity in 
     providing professional energy audits and renewable energy 
     assessments;
       (B) the geographic scope of the program proposed by the 
     eligible entity;
       (C) the number of farmers, ranchers, and rural small 
     businesses to be assisted by the program;
       (D) the potential for energy savings and environmental and 
     public health benefits resulting from the program; and
       (E) the plan of the eligible entity for educating farmers, 
     ranchers, and rural small businesses on the benefits of 
     energy efficiency and renewable energy development.
       (d) Use of Grant Funds.--
       (1) Required uses.--A recipient of a grant under subsection 
     (a) shall use the grant funds to conduct and promote energy 
     audits for farmers, ranchers, and rural small businesses to 
     provide farmers, ranchers, and rural small businesses 
     recommendations on how to improve energy efficiency and use 
     renewable energy technology and resources.
       (2) Permitted uses.--In addition to the uses described in 
     paragraph (1), a recipient of a grant may use the grant funds 
     to make farmers, ranchers, and rural small businesses aware 
     of, and ensure that they have access to--
       (A) financial assistance under section 9006; and
       (B) other Federal, State, and local financial assistance 
     programs for which farmers, ranchers, and rural small 
     businesses may be eligible.
       (e) Cost Sharing.--A recipient of a grant under subsection 
     (a) that conducts an energy audit for a farmer, rancher, or 
     rural small business under subsection (d)(1) shall require 
     that, as a condition of the energy audit, the farmer, 
     rancher, or rural small business pay at least 25 percent of 
     the cost of the audit.
       (f) Use of Cost-Share Funds.--Funds collected by a 
     recipient of a grant under subsection (e) as a result of 
     activities carried out using the grant funds shall be used to 
     conduct activities authorized under this section, as approved 
     by the Secretary.
       (g) Consultation.--In carrying out this section, the 
     Secretary shall consult with the Secretary of Energy.
       (h) Reports.--Not later than 4 years after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report on the implementation of this section.
       (i) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section for each of fiscal years 2002 through 2007.

     SEC. 9006. RENEWABLE ENERGY SYSTEMS AND ENERGY EFFICIENCY 
                   IMPROVEMENTS.

       (a) In General.--In addition to exercising authority to 
     make loans and loan guarantees under other law, the Secretary 
     shall make loans, loan guarantees, and grants to farmers, 
     ranchers, and rural small businesses to--
       (1) purchase renewable energy systems; and
       (2) make energy efficiency improvements.
       (b) Eligibility.--To be eligible to receive a grant under 
     subsection (a), a farmer, rancher, or rural small business 
     shall demonstrate financial need as determined by the 
     Secretary.
       (c) Cost Sharing.--
       (1) In general.--
       (A) Grants.--The amount of a grant shall not exceed 25 
     percent of the cost of the activity funded under subsection 
     (a).
       (B) Maximum amount of combined grant and loan.--The 
     combined amount of a grant and loan made or guaranteed shall 
     not exceed 50 percent of the cost of the activity funded 
     under subsection (a).
       (2) Factors.--In determining the amount of a grant or loan, 
     the Secretary shall take into consideration, as applicable--
       (A) the type of renewable energy system to be purchased;
       (B) the estimated quantity of energy to be generated by the 
     renewable energy system;
       (C) the expected environmental benefits of the renewable 
     energy system;
       (D) the extent to which the renewable energy system will be 
     replicable;
       (E) the amount of energy savings expected to be derived 
     from the activity, as demonstrated by an energy audit 
     comparable to an energy audit under section 9005;
       (F) the estimated length of time it would take for the 
     energy savings generated by the activity to equal the cost of 
     the activity; and
       (G) other factors as appropriate.
       (d) Interest Rate.--
       (1) In general.--A loan made by the Secretary under 
     subsection (a) shall bear interest at the rate equivalent to 
     the rate of interest charged on Treasury securities of 
     comparable maturity on the date the loan is approved.
       (2) Duration.--The interest rate for each loan will remain 
     in effect for the term of the loan.
       (e) Consultation.--In carrying out this section, the 
     Secretary shall consult with the Secretary of Energy.
       (f) Funding.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall make available to carry out 
     this section $23,000,000 for each of fiscal years 2003 
     through 2007.

[[Page H1886]]

     SEC. 9007. HYDROGEN AND FUEL CELL TECHNOLOGIES.

       (a) In General.--The Secretary and the Secretary of Energy 
     shall enter into a memorandum of understanding under which 
     the Secretary and the Secretary of Energy shall cooperate in 
     the application of hydrogen and fuel cell technology programs 
     for rural communities and agricultural producers.
       (b) Dissemination of Information.--Under the memorandum of 
     understanding, the Secretary shall work with the Secretary of 
     Energy to disseminate information to rural communities and 
     agricultural producers on potential applications of hydrogen 
     and fuel cell technologies.

     SEC. 9008. BIOMASS RESEARCH AND DEVELOPMENT.

       (a) Funding.--The Biomass Research and Development Act of 
     2000 (7 U.S.C. 7624 note; Public Law 106-224) is amended--
       (1) in section 307, by striking subsection (f);
       (2) by redesignating section 310 as section 311; and
       (3) by inserting after section 309 the following:

     ``SEC. 310. FUNDING.

       ``(a) Funding.--Of funds of the Commodity Credit 
     Corporation, the Secretary shall make available to carry out 
     this title--
       ``(1) $5,000,000 for fiscal year 2002; and
       ``(2) $14,000,000 for each of fiscal years 2003 through 
     2007;

     to remain available until expended.
       ``(b) Authorization of Appropriations.--In addition to 
     amounts transferred under subsection (a), there are 
     authorized to be appropriated to carry out this title 
     $49,000,000 for each of fiscal years 2002 through 2007.''.
       (b) Termination of Authority.--Section 311 of the Biomass 
     Research and Development Act of 2000 (7 U.S.C. 7624 note; 
     Public Law 106-224) (as redesignated by subsection (a)) is 
     amended by striking ``December 31, 2005'' and inserting 
     ``September 30, 2007''.

     SEC. 9009. COOPERATIVE RESEARCH AND EXTENSION PROJECTS.

       Section 221 of the Agricultural Risk Protection Act of 2000 
     (114 Stat. 407) is amended--
       (1) by redesignating subsection (d) as subsection (f); and
       (2) by inserting after subsection (c) the following:
       ``(d) Cooperative Research.--
       ``(1) In general.--Subject to the availability of 
     appropriations, the Secretary, in cooperation with 
     departments and agencies participating in the U.S. Global 
     Change Research Program (which may use any of their statutory 
     authorities) and with eligible entities, may carry out 
     research to promote understanding of--
       ``(A) the flux of carbon in soils and plants (including 
     trees); and
       ``(B) the exchange of other greenhouse gases from 
     agriculture.
       ``(2) Eligible entities.--Research under this subsection 
     may be carried out through the competitive awarding of grants 
     and cooperative agreements to colleges and universities (as 
     defined in section 1404 of the National Agricultural 
     Research, Extension, and Teaching Policy Act of 1977 (7 
     U.S.C. 1303)).
       ``(3) Cooperative research purposes.--Research conducted 
     under this subsection shall encourage collaboration among 
     scientists with expertise in the areas of soil science, 
     agronomy, agricultural economics, forestry, and other 
     agricultural sciences to focus on--
       ``(A) developing data addressing carbon losses and gains in 
     soils and plants (including trees) and the exchange of 
     methane and nitrous oxide from agriculture;
       ``(B) understanding how agricultural and forestry practices 
     affect the sequestration of carbon in soils and plants 
     (including trees) and the exchange of other greenhouse gases, 
     including the effects of new technologies such as 
     biotechnology and nanotechnology;
       ``(C) developing cost-effective means of measuring and 
     monitoring changes in carbon pools in soils and plants 
     (including trees), including computer models;
       ``(D) evaluating the linkage between federal conservation 
     programs and carbon sequestration;
       ``(E) developing methods, including remote sensing, to 
     measure the exchange of carbon and other greenhouse gases 
     sequestered, and to evaluate leakage, performance, and 
     permanence issues; and
       ``(F) assessing the applicability of the results of 
     research conducted under this subsection for developing 
     methods to account for the impact of agricultural activities 
     (including forestry) on the exchange of greenhouse gases.
       ``(4) Authorization of appropriation.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this subsection for each of fiscal years 2002 through 2007.
       ``(e) Extension Projects.--
       ``(1) In general.--The Secretary, in cooperation with 
     departments and agencies participating in the U.S. Global 
     Change Research Program (which may use any of their statutory 
     authorities), and local extension agents, experts from 
     institutions of higher education that offer a curriculum in 
     agricultural and biological sciences, and other local 
     agricultural or conservation organizations, may implement 
     extension projects (including on-farm projects with direct 
     involvement of agricultural producers) that combine 
     measurement tools and modeling techniques into integrated 
     packages to monitor the carbon sequestering benefits of 
     conservation practices and the exchange of greenhouse gas 
     emissions from agriculture which demonstrate the feasibility 
     of methods of measuring and monitoring--
       ``(A) changes in carbon content and other carbon pools in 
     soils and plants (including trees); and
       ``(B) the exchange of other greenhouse gases.
       ``(2) Extension project results.--The Secretary may 
     disseminate to farmers, ranchers, private forest landowners, 
     and appropriate State agencies in each State information 
     concerning--
       ``(A) the results of projects under this subsection; and
       ``(B) the manner in which the methods used in the projects 
     might be applicable to the operations of the farmers, 
     ranchers, private forest landowners, and State agencies.
       ``(3) Authorization of appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this subsection for each of fiscal years 2002 
     through 2007.''.

     SEC. 9010. CONTINUATION OF BIOENERGY PROGRAM.

       (a) Definitions.--In this section:
       (1) Bioenergy.--The term ``bioenergy'' means--
       (A) biodiesel; and
       (B) fuel grade ethanol.
       (2) Biodiesel.--The term ``biodiesel'' means a monoalkyl 
     ester that meets the requirements of an appropriate American 
     Society for Testing and Materials standard.
       (3) Eligible commodity.--The term ``eligible commodity'' 
     means--
       (A) wheat, corn, grain sorghum, barley, oats, rice, 
     soybeans, sunflower seed, rapeseed, canola, safflower, 
     flaxseed, mustard, crambe, sesame seed, and cottonseed;
       (B) a cellulosic commodity (such as hybrid poplar and 
     switch grass);
       (C) fats, oils, and greases (including recycled fats, oils, 
     and greases) derived from an agricultural product; and
       (D) any animal byproduct (in addition to oils, fats, and 
     greases) that may be used to produce bioenergy, as determined 
     by the Secretary.
       (4) Eligible producer.--The term ``eligible producer'' 
     means a producer that uses an eligible commodity to produce 
     bioenergy.
       (b) Bioenergy Program.--
       (1) Continuation.--The Secretary shall continue the program 
     under part 1424 of title 7, Code of Federal Regulations (or 
     any successor regulation), under which the Secretary makes 
     payments to eligible producers to encourage increased 
     purchases of eligible commodities for the purpose of 
     expanding production of such bioenergy and supporting new 
     production capacity for such bioenergy.
       (2) Contracts.--To be eligible to receive a payment, an 
     eligible producer shall--
       (A) enter into a contract with the Secretary to increase 
     bioenergy production for 1 or more fiscal years; and
       (B) submit to the Secretary such records as the Secretary 
     may require as evidence of increased purchase and use of 
     eligible commodities for the production of bioenergy.
       (3) Payment.--
       (A) In general.--Under the program, the Secretary shall 
     make payments to eligible producers, based on the quantity of 
     bioenergy produced by the eligible producer during a fiscal 
     year that exceeds the quantity of bioenergy produced by the 
     eligible producer during the preceding fiscal year.
       (B) Payment rate.--
       (i) Producers of less than 65,000,000 gallons.--An eligible 
     producer that produces less than 65,000,000 gallons of 
     bioenergy shall be reimbursed 1 feedstock unit for every 2.5 
     feedstock units of eligible commodity used for increased 
     production.
       (ii) Producers of 65,000,000 or more gallons.--An eligible 
     producer that produces 65,000,000 or more gallons of 
     bioenergy shall be reimbursed 1 feedstock unit for every 3.5 
     feedstock units of eligible commodity used for increased 
     production.
       (C) Quarterly payments.--The Secretary shall make payments 
     to an eligible producer for each quarter of the fiscal year.
       (4) Proration.--If the amount made available for a fiscal 
     year under subsection (c) is insufficient to allow the 
     payment of the amount of the payments that eligible producers 
     (that apply for the payments) otherwise would receive under 
     this subsection, the Secretary shall prorate the amount of 
     the funds among all such eligible producers.
       (5) Overpayments.--If the total amount of payments that an 
     eligible producer receives for a fiscal year under this 
     section exceeds the amount that the eligible producer should 
     have received under this subsection, the eligible producer 
     shall repay the amount of the overpayment to the Secretary, 
     with interest (as determined by the Secretary).
       (6) Limitation.--No eligible producer shall receive more 
     than 5 percent of the total amount made available under 
     subsection (c) for a fiscal year.
       (7) Other requirements.--To be eligible to receive a 
     payment under this subsection, an eligible producer shall 
     meet other requirements of Federal law (including 
     regulations) applicable to the production of bioenergy.
       (c) Funding.--Of the funds of the Commodity Credit 
     Corporation, the Secretary shall use to carry out this 
     section--
       (1) not more than $150,000,000 for each of fiscal years 
     2003 through 2006; and
       (2) $0 for fiscal year 2007.
                         TITLE X--MISCELLANEOUS
                       Subtitle A--Crop Insurance

     SEC. 10001. EQUAL CROP INSURANCE TREATMENT OF POTATOES AND 
                   SWEET POTATOES.

       Section 508(a)(2) of the Federal Crop Insurance Act (7 
     U.S.C. 1508(a)(2)) is amended in the first sentence by 
     striking ``and potatoes'' and inserting ``, potatoes, and 
     sweet potatoes''.

     SEC. 10002. CONTINUOUS COVERAGE.

       Section 508(e)(4) of the Federal Crop Insurance Act (7 
     U.S.C. 1508(e)(4)) is amended--
       (1) in the paragraph heading, by striking ``Temporary 
     prohibition'' and inserting ``Prohibition''; and

[[Page H1887]]

       (2) by striking ``through 2005'' and inserting ``and 
     subsequent''.

     SEC. 10003. QUALITY LOSS ADJUSTMENT PROCEDURES.

       Section 508(m) of the Federal Crop Insurance Act (7 U.S.C. 
     1508(m)) is amended--
       (1) in paragraph (3)--
       (A) by striking ``The Corporation'' and inserting the 
     following:
       ``(A) Review.--The Corporation''; and
       (B) by striking ``Based on'' and inserting the following:
       ``(B) Procedures.--Effective beginning not later than the 
     2004 reinsurance year, based on''; and
       (2) by adding at the end the following:
       ``(4) Quality of agricultural commodities delivered to 
     warehouse operators.--In administering this title, the 
     Secretary shall accept, in the same manner and under the same 
     terms and conditions, evidence of the quality of agricultural 
     commodities delivered to--
       ``(A) warehouse operators that are licensed under the 
     United States Warehouse Act (7 U.S.C. 241 et seq.);
       ``(B) warehouse operators that--
       ``(i) are licensed under State law; and
       ``(ii) have entered into a storage agreement with the 
     Commodity Credit Corporation; and
       ``(C) warehouse operators that--
       ``(i) are not licensed under State law but are in 
     compliance with State law regarding warehouses; and
       ``(ii) have entered into a commodity storage agreement with 
     the Commodity Credit Corporation.''.

     SEC. 10004. ADJUSTED GROSS REVENUE INSURANCE PILOT PROGRAM.

       Section 523 of the Federal Crop Insurance Act (7 U.S.C. 
     1523) is amended by adding at the end the following:
       ``(e) Adjusted Gross Revenue Insurance Pilot Program.--
       ``(1) In general.--The Corporation shall carry out, through 
     at least the 2004 reinsurance year, the adjusted gross 
     revenue insurance pilot program in effect for the 2002 
     reinsurance year.
       ``(2) Additional counties.--
       ``(A) In general.--In addition to counties otherwise 
     included in the pilot program, the Corporation shall include 
     in the pilot program for the 2003 reinsurance year at least 8 
     counties in the State of California and at least 8 counties 
     in the State of Pennsylvania.
       ``(B) Selection criteria.--In carrying out subparagraph 
     (A), the Corporation shall work with the respective State 
     Departments of Agriculture to establish criteria to determine 
     which counties to include in the pilot program.''.

     SEC. 10005. SENSE OF CONGRESS ON EXPANSION OF CROP INSURANCE 
                   COVERAGE.

       It is the sense of Congress that the Federal Crop Insurance 
     Corporation should address needs of producers through the 
     expansion of pilot programs and coverage under the Federal 
     Crop Insurance Act (7 U.S.C. 1501 et seq.), including--
       (1) crop revenue insurance for the producers of pecans in 
     the State of Georgia; and
       (2) coverage for continuous crops of wheat produced in the 
     State of Kansas.

     SEC. 10006. REPORT ON SPECIALTY CROP INSURANCE.

       Not later than 180 days after the date of enactment of this 
     Act, the Secretary of Agriculture shall submit to the 
     Committee on Agriculture of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate a report that describes--
       (1) the progress made by the Federal Crop Insurance 
     Corporation in research and development of innovative risk 
     management products to include cost of production insurance 
     that provides coverage for specialty crops, paying special 
     attention to apples, asparagus, blueberries (wild and 
     domestic), cabbage, canola, carrots, cherries, Christmas 
     trees, citrus fruits, cucumbers, dry beans, eggplants, 
     floriculture, grapes, greenhouse and nursery agricultural 
     commodities, green peas, green peppers, hay, lettuce, maple, 
     mushrooms, pears, potatoes, pumpkins, snap beans, spinach, 
     squash, strawberries, sugar beets, and tomatoes; and
       (2) the progress made by the Corporation in increasing the 
     use of risk management products offered through the 
     Corporation by producers of specialty crops, by small- and 
     moderate-sized farms, and in areas that are underserved, as 
     determined by the Secretary.
                    Subtitle B--Disaster Assistance

     SEC. 10101. REFERENCE TO SEA GRASS AND SEA OATS AS CROPS 
                   COVERED BY NONINSURED CROP DISASTER ASSISTANCE 
                   PROGRAM.

       Section 196(a)(2)(B) of the Federal Agriculture Improvement 
     and Reform Act of 1996 (7 U.S.C. 7333(a)(2)(B)) is amended by 
     inserting ``sea grass and sea oats,'' after ``fish),''.

     SEC. 10102. EMERGENCY GRANTS TO ASSIST LOW-INCOME MIGRANT AND 
                   SEASONAL FARMWORKERS.

       Section 2281(a) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (42 U.S.C. 5177a(a)) is amended by striking 
     ``, not to exceed $20,000,000 annually,''.

     SEC. 10103. EMERGENCY LOANS FOR SEED PRODUCERS.

       Section 253(b)(5)(B) of the Agricultural Risk Protection 
     Act of 2000 (Public Law 106-224; 114 Stat. 423) is amended by 
     striking ``18 months'' and inserting ``36 months''.

     SEC. 10104. ASSISTANCE FOR LIVESTOCK PRODUCERS.

       (a) Availability of Assistance.--In such amounts as are 
     provided in advance in appropriation Acts, the Secretary of 
     Agriculture may provide assistance to dairy and other 
     livestock producers to cover economic losses incurred by such 
     producers in connection with the production of livestock.
       (b) Types of Assistance.--The assistance provided to 
     livestock producers may be in the following forms:
       (1) Indemnity payments to livestock producers who incur 
     livestock mortality losses.
       (2) Livestock feed assistance to livestock producers 
     affected by shortages of feed.
       (3) Compensation for sudden increases in production costs.
       (4) Such other assistance, and for such other economic 
     losses, as the Secretary considers appropriate.
       (c) Limitations.--The Secretary may not use the funds of 
     the Commodity Credit Corporation to provide assistance under 
     this section.
       (d) Authorization of Appropriations.--There is authorized 
     to be appropriated to the Secretary such sums as may be 
     necessary to carry out this section.

     SEC. 10105. MARKET LOSS ASSISTANCE FOR APPLE PRODUCERS.

       (a) In General.--Of the funds of the Commodity Credit 
     Corporation, the Secretary of Agriculture shall use 
     $94,000,000 for fiscal year 2002 to make payments, as soon as 
     practicable after the date of enactment of this Act, to apple 
     producers for the loss of markets during the 2000 crop year.
       (b) Payment Quantity.--The payment quantity of apples for 
     which the producers on a farm are eligible for payments under 
     this section shall be equal to the lesser of--
       (1) the quantity of the 2000 crop of apples produced by the 
     producers on the farm; or
       (2) 5,000,000 pounds of apples produced on the farm.
       (c) Limitations.--Subject to subsection (b)(2), the 
     Secretary shall not establish a payment limitation, or income 
     eligibility limitation, with respect to payments made under 
     this section.
       (d) Regulations.--
       (1) In general.--The Secretary shall promulgate such 
     regulations as are necessary to implement this section.
       (2) Procedure.--The promulgation of the regulations and 
     administration of this section shall be made without regard 
     to--
       (A) the notice and comment provisions of section 553 of 
     title 5, United States Code;
       (B) the Statement of Policy of the Secretary of Agriculture 
     effective July 24, 1971 (36 Fed. Reg. 13804), relating to 
     notices of proposed rulemaking and public participation in 
     rulemaking; and
       (C) chapter 35 of title 44, United States Code (commonly 
     known as the ``Paperwork Reduction Act'').
       (3) Congressional review of agency rulemaking.--In carrying 
     out this subsection, the Secretary shall use the authority 
     provided under section 808 of title 5, United States Code.

     SEC. 10106. MARKET LOSS ASSISTANCE FOR ONION PRODUCERS.

       The Secretary of Agriculture shall use $10,000,000 of the 
     funds of the Commodity Credit Corporation to make a grant to 
     the State of New York to be used to support onion producers 
     in Orange County, New York, that have suffered losses to 
     onion crops during 1 or more of the 1996 through 2000 crop 
     years.

     SEC. 10107. COMMERCIAL FISHERIES FAILURE.

       (a) In General.--The Secretary of Agriculture, in 
     consultation with the Secretary of Commerce, shall provide 
     emergency disaster assistance for the commercial fishery 
     failure under section 308(b)(1) of the Interjurisdictional 
     Fisheries Act of 1986 (16 U.S.C. 4107(b)(1)) with respect to 
     Northeast multispecies fisheries.
       (b) Program Requirements.--Amounts made available to carry 
     out this section shall be used to support a voluntary fishing 
     capacity reduction program in the Northeast multispecies 
     fishery that--
       (1) is certified by the Secretary of Commerce to be 
     consistent with section 312(b) of the Magnuson-Stevens 
     Fishery Conservation and Management Act (16 U.S.C. 1861a(b)); 
     and
       (2) permanently revokes multispecies limited access fishing 
     permits so as to obtain the maximum sustained reduction in 
     fishing capacity at the least cost and in the minimum period 
     of time and to prevent the replacement of fishing capacity 
     removed by the program.
       (c) Application of Regulations.--The program shall be 
     carried out in accordance with the regulations codified at 
     part 648 of title 50, Code of Federal Regulations, and any 
     corresponding rule issued in accordance with the regulations.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.
       (e) Termination of Authority.--The authority provided under 
     this section terminates on the date that is 1 year after the 
     date of enactment of this Act.

     SEC. 10108. STUDY OF FEASIBILITY OF PRODUCER INDEMNIFICATION 
                   FROM GOVERNMENT-CAUSED DISASTERS.

       (a) Findings.--Congress finds that the implementation of 
     Federal disaster assistance programs fails to adequately 
     address situations in which disaster conditions are caused 
     primarily by Federal action.
       (b) Authority.--The Secretary of Agriculture shall conduct 
     a study of the feasibility of expanding eligibility for crop 
     insurance under the Federal Crop Insurance Act (7 U.S.C. 1501 
     et seq.), and noninsured crop assistance under section 196 of 
     the Federal Agriculture Improvement and Reform Act of 1996 (7 
     U.S.C. 7333), to agricultural producers experiencing disaster 
     conditions caused primarily by Federal agency action 
     restricting access to irrigation water, including any lack of 
     access to an adequate supply of water caused by failure by 
     the Secretary of the Interior to fulfill a contract in 
     accordance with the Central Valley Project Improvement Act 
     (106 Stat. 4706).
       (c) Report.--Not later than 150 days after the date of 
     enactment of this Act, the Secretary shall submit to the 
     Committee on Agriculture of

[[Page H1888]]

     the House of Representatives and the Committee on 
     Agriculture, Nutrition, and Forestry of the Senate a report 
     that describes the results of the study, including any 
     recommendations.
                  Subtitle C--Tree Assistance Program

     SEC. 10201. DEFINITIONS.

       In this subtitle:
       (1) Eligible orchardist.--The term ``eligible orchardist'' 
     means a person that produces annual crops from trees for 
     commercial purposes.
       (2) Natural disaster.--The term ``natural disaster'' means 
     plant disease, insect infestation, drought, fire, freeze, 
     flood, earthquake, lightning, and other occurrence, as 
     determined by the Secretary.
       (3) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (4) Tree.--The term ``tree'' includes a tree, bush, and 
     vine.

     SEC. 10202. ELIGIBILITY.

       (a) Loss.--Subject to subsection (b), the Secretary shall 
     provide assistance under section 10203 to eligible 
     orchardists that planted trees for commercial purposes but 
     lost the trees as a result of a natural disaster, as 
     determined by the Secretary.
       (b) Limitation.--An eligible orchardist shall qualify for 
     assistance under subsection (a) only if the tree mortality of 
     the eligible orchardist, as a result of damaging weather or 
     related condition, exceeds 15 percent (adjusted for normal 
     mortality).

     SEC. 10203. ASSISTANCE.

       Subject to section 10204, the assistance provided by the 
     Secretary to eligible orchardists for losses described in 
     section 10202 shall consist of--
       (1) reimbursement of 75 percent of the cost of replanting 
     trees lost due to a natural disaster, as determined by the 
     Secretary, in excess of 15 percent mortality (adjusted for 
     normal mortality); or
       (2) at the option of the Secretary, sufficient seedlings to 
     reestablish a stand.

     SEC. 10204. LIMITATIONS ON ASSISTANCE.

       (a) Amount.--The total amount of payments that a person 
     shall be entitled to receive under this subtitle may not 
     exceed $75,000, or an equivalent value in tree seedlings.
       (b) Acres.--The total quantity of acres planted to trees or 
     tree seedlings for which a person shall be entitled to 
     receive payments under this subtitle may not exceed 500 
     acres.
       (c) Regulations.--The Secretary shall promulgate 
     regulations--
       (1) defining the term ``person'' for the purposes of this 
     subtitle, which shall conform, to the maximum extent 
     practicable, to the regulations defining the term ``person'' 
     promulgated under section 1001 of the Food Security Act of 
     1985 (7 U.S.C. 1308); and
       (2) promulgating such regulations as the Secretary 
     determines necessary to ensure a fair and reasonable 
     application of the limitation established under this section.

     SEC. 10205. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated such sums as are 
     necessary to carry out this subtitle.
                       Subtitle D--Animal Welfare

     SEC. 10301. DEFINITION OF ANIMAL UNDER THE ANIMAL WELFARE 
                   ACT.

       Section 2(g) of the Animal Welfare Act (7 U.S.C. 2132(g)) 
     is amended in the first sentence by striking ``excludes 
     horses not used for research purposes and'' and inserting the 
     following: ``excludes (1) birds, rats of the genus Rattus, 
     and mice of the genus Mus, bred for use in research, (2) 
     horses not used for research purposes, and (3)''.

     SEC. 10302. PROHIBITION ON INTERSTATE MOVEMENT OF ANIMALS FOR 
                   ANIMAL FIGHTING.

       (a) In General.--Section 26 of the Animal Welfare Act (7 
     U.S.C. 2156) is amended--
       (1) by striking subsection (a) and inserting the following:
       ``(a) Sponsoring or Exhibiting an Animal in an Animal 
     Fighting Venture.--
       ``(1) In general.--Except as provided in paragraph (2), it 
     shall be unlawful for any person to knowingly sponsor or 
     exhibit an animal in an animal fighting venture, if any 
     animal in the venture was moved in interstate or foreign 
     commerce.
       ``(2) Special rule for certain states.--With respect to 
     fighting ventures involving live birds in a State where it 
     would not be in violation of the law, it shall be unlawful 
     under this subsection for a person to sponsor or exhibit a 
     bird in the fighting venture only if the person knew that any 
     bird in the fighting venture was knowingly bought, sold, 
     delivered, transported, or received in interstate or foreign 
     commerce for the purpose of participation in the fighting 
     venture.'';
       (2) in subsection (b), by striking ``or deliver to another 
     person or receive from another person'' and inserting 
     ``deliver, or receive''; and
       (3) in subsection (d), by striking ``subsections (a), (b), 
     or (c) of this section'' and inserting ``subsection (c)''.
       (b) Effective Date.--The amendments made by this section 
     take effect 1 year after the date of enactment of this Act.

     SEC. 10303. PENALTIES AND FOREIGN COMMERCE PROVISIONS OF THE 
                   ANIMAL WELFARE ACT.

       (a) In General.--Section 26 of the Animal Welfare Act (7 
     U.S.C. 2156) is amended--
       (1) in subsection (e)--
       (A) by inserting ``Penalties.--'' after ``(e)''; and
       (B) by striking ``$5,000'' and inserting ``$15,000''; and
       (2) in subsection (g)(2)(B), by inserting before the 
     semicolon at the end the following: ``or from any State into 
     any foreign country''.
       (b) Effective Date.--The amendment made by this section 
     takes effect 1 year after the date of enactment of this Act.

     SEC. 10304. REPORT ON RATS, MICE, AND BIRDS.

       (a) In General.--Not later than 1 year after the date of 
     enactment of this Act, the National Research Council shall 
     submit to the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate, a report on the implications of 
     including rats, mice, and birds within the definition of 
     animal under the regulations promulgated under the Animal 
     Welfare Act (7 U.S.C. 2131 et seq.)
       (b) Requirements.--The report under subsection (a) shall--
       (1) be completed with input, consultation, and 
     recommendations from--
       (A) the Secretary of Agriculture;
       (B) the Secretary of Health and Human Services; and
       (C) the Institute for Animal Laboratory Research within the 
     National Academy of Sciences;
       (2) contain an estimate of--
       (A) the number and types of entities that use rats, mice, 
     and birds for research purposes; and
       (B) which of the entities--
       (i) are subject to regulations of the Department of 
     Agriculture;
       (ii) are subject to regulations or guidelines of the 
     Department of Health and Human Services; or
       (iii) voluntarily comply with the accreditation 
     requirements of the Association for Assessment and 
     Accreditation of Laboratory Animal Care;
       (3) contain an estimate of the numbers of rats, mice, and 
     birds used in research facilities, with an indication of 
     which of the facilities--
       (A) are subject to regulations of the Department of 
     Agriculture;
       (B) are subject to regulations or guidelines of the 
     Department of Health and Human Services; or
       (C) voluntarily comply with the accreditation requirements 
     of the Association for Assessment and Accreditation of 
     Laboratory Animal Care;
       (4) contain an estimate of the additional costs likely to 
     be incurred by breeders and research facilities resulting 
     from the additional regulatory requirements needed in order 
     to afford the same level of protection to rats, mice, and 
     birds as is provided for species regulated by the Department 
     of Agriculture, detailing the costs associated with 
     individual regulatory requirements;
       (5) contain recommendations for minimizing such costs, 
     including--
       (A) an estimate of the cost savings that would result from 
     providing a different level of protection to rats, mice, and 
     birds than is provided for species regulated by the 
     Department of Agriculture; and
       (B) an estimate of the cost savings that would result if 
     new regulatory requirements were substantially equivalent to, 
     and harmonized with, guidelines of the National Institutes of 
     Health;
       (6) contain an estimate of the additional funding that the 
     Animal and Plant Health Inspection Service would require to 
     be able to ensure that the level of compliance with respect 
     to other regulated animals is not diminished by the increase 
     in the number of facilities that would require inspections if 
     a rule extending the regulatory definition of animal to rats, 
     mice, and birds were to become effective; and
       (7) contain recommendations for--
       (A) minimizing the regulatory burden on facilities subject 
     to--
       (i) regulations of the Department of Agriculture;
       (ii) regulations or guidelines of the Department of Health 
     and Human Services; or
       (iii) accreditation requirements of the Association for 
     Assessment and Accreditation of Laboratory Animal Care; and
       (B) preventing any duplication of regulatory requirements.

     SEC. 10305. ENFORCEMENT OF HUMANE METHODS OF SLAUGHTER ACT OF 
                   1958.

       (a) Sense of Congress.--It is the sense of Congress that 
     the Secretary of Agriculture should--
       (1) continue tracking the number of violations of Public 
     Law 85-765 (7 U.S.C. 1901 et seq.; commonly known as the 
     ``Humane Methods of Slaughter Act of 1958'') and report the 
     results and relevant trends annually to Congress; and
       (2) fully enforce Public Law 85-765 by ensuring that humane 
     methods in the slaughter of livestock--
       (A) prevent needless suffering;
       (B) result in safer and better working conditions for 
     persons engaged in slaughtering operations;
       (C) bring about improvement of products and economies in 
     slaughtering operations; and
       (D) produce other benefits for producers, processors, and 
     consumers that tend to expedite an orderly flow of livestock 
     and livestock products in interstate and foreign commerce.
       (b) United States Policy.--It is the policy of the United 
     States that the slaughtering of livestock and the handling of 
     livestock in connection with slaughter shall be carried out 
     only by humane methods, as provided by Public Law 85-765.
                  Subtitle E--Animal Health Protection

     SEC. 10401. SHORT TITLE.

       This subtitle may be cited as the ``Animal Health 
     Protection Act''.

     SEC. 10402. FINDINGS.

       Congress finds that--
       (1) the prevention, detection, control, and eradication of 
     diseases and pests of animals are essential to protect--
       (A) animal health;
       (B) the health and welfare of the people of the United 
     States;
       (C) the economic interests of the livestock and related 
     industries of the United States;
       (D) the environment of the United States; and
       (E) interstate commerce and foreign commerce of the United 
     States in animals and other articles;

[[Page H1889]]

       (2) animal diseases and pests are primarily transmitted by 
     animals and articles regulated under this subtitle;
       (3) the health of animals is affected by the methods by 
     which animals and articles are transported in interstate 
     commerce and foreign commerce;
       (4) the Secretary must continue to conduct research on 
     animal diseases and pests that constitute a threat to the 
     livestock of the United States; and
       (5)(A) all animals and articles regulated under this 
     subtitle are in or affect interstate commerce or foreign 
     commerce; and
       (B) regulation by the Secretary and cooperation by the 
     Secretary with foreign countries, States or other 
     jurisdictions, or persons are necessary--
       (i) to prevent and eliminate burdens on interstate commerce 
     and foreign commerce;
       (ii) to regulate effectively interstate commerce and 
     foreign commerce; and
       (iii) to protect the agriculture, environment, economy, and 
     health and welfare of the people of the United States.

     SEC. 10403. DEFINITIONS.

       In this subtitle:
       (1) Animal.--The term ``animal'' means any member of the 
     animal kingdom (except a human).
       (2) Article.--The term ``article'' means any pest or 
     disease or any material or tangible object that could harbor 
     a pest or disease.
       (3) Disease.--The term ``disease'' has the meaning given 
     the term by the Secretary.
       (4) Enter.--The term ``enter'' means to move into the 
     commerce of the United States.
       (5) Export.--The term ``export'' means to move from a place 
     within the territorial limits of the United States to a place 
     outside the territorial limits of the United States.
       (6) Facility.--The term ``facility'' means any structure.
       (7) Import.--The term ``import'' means to move from a place 
     outside the territorial limits of the United States to a 
     place within the territorial limits of the United States.
       (8) Indian tribe.--The term ``Indian tribe'' has the 
     meaning given the term in section 4 of the Indian Self-
     Determination and Education Assistance Act (25 U.S.C. 450b).
       (9) Interstate commerce.--The term ``interstate commerce'' 
     means trade, traffic, or other commerce--
       (A) between a place in a State and a place in another 
     State, or between places within the same State but through 
     any place outside that State; or
       (B) within the District of Columbia or any territory or 
     possession of the United States.
       (10) Livestock.--The term ``livestock'' means all farm-
     raised animals.
       (11) Means of conveyance.--The term ``means of conveyance'' 
     means any personal property used for or intended for use for 
     the movement of any other personal property.
       (12) Move.--The term ``move'' means--
       (A) to carry, enter, import, mail, ship, or transport;
       (B) to aid, abet, cause, or induce carrying, entering, 
     importing, mailing, shipping, or transporting;
       (C) to offer to carry, enter, import, mail, ship, or 
     transport;
       (D) to receive in order to carry, enter, import, mail, 
     ship, or transport;
       (E) to release into the environment; or
       (F) to allow any of the activities described in this 
     paragraph.
       (13) Pest.--The term ``pest'' means any of the following 
     that can directly or indirectly injure, cause damage to, or 
     cause disease in livestock:
       (A) A protozoan.
       (B) A plant.
       (C) A bacteria.
       (D) A fungus.
       (E) A virus or viroid.
       (F) An infectious agent or other pathogen.
       (G) An arthropod.
       (H) A parasite.
       (I) A prion.
       (J) A vector.
       (K) Any organism similar to or allied with any of the 
     organisms described in this paragraph.
       (14) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (15) State.--The term ``State'' means any of the States, 
     the District of Columbia, the Commonwealth of Puerto Rico, 
     Guam, the Commonwealth of the Northern Mariana Islands, the 
     Virgin Islands of the United States, or any territory or 
     possession of the United States.
       (16) This subtitle.--Except when used in this section, the 
     term ``this subtitle'' includes any regulation or order 
     issued by the Secretary under the authority of this subtitle.
       (17) United states.--The term ``United States'' means all 
     of the States.

     SEC. 10404. RESTRICTION ON IMPORTATION OR ENTRY.

       (a) In General.--With notice to the Secretary of the 
     Treasury and public notice as soon as practicable, the 
     Secretary may prohibit or restrict--
       (1) the importation or entry of any animal, article, or 
     means of conveyance, or use of any means of conveyance or 
     facility, if the Secretary determines that the prohibition or 
     restriction is necessary to prevent the introduction into or 
     dissemination within the United States of any pest or disease 
     of livestock;
       (2) the further movement of any animal that has strayed 
     into the United States if the Secretary determines that the 
     prohibition or restriction is necessary to prevent the 
     introduction into or dissemination within the United States 
     of any pest or disease of livestock; and
       (3) the use of any means of conveyance in connection with 
     the importation or entry of livestock if the Secretary 
     determines that the prohibition or restriction is necessary 
     because the means of conveyance has not been maintained in a 
     clean and sanitary condition or does not have accommodations 
     for the safe and proper movement of livestock.
       (b) Regulations.--
       (1) Restrictions on import and entry.--The Secretary may 
     issue such orders and promulgate such regulations as are 
     necessary to carry out subsection (a).
       (2) Post importation quarantine.--The Secretary may 
     promulgate regulations requiring that any animal imported or 
     entered be raised or handled under post-importation 
     quarantine conditions by or under the supervision of the 
     Secretary for the purpose of determining whether the animal 
     is or may be affected by any pest or disease of livestock.
       (c) Destruction or Removal.--
       (1) In general.--The Secretary may order the destruction or 
     removal from the United States of--
       (A) any animal, article, or means of conveyance that has 
     been imported but has not entered the United States if the 
     Secretary determines that destruction or removal from the 
     United States is necessary to prevent the introduction into 
     or dissemination within the United States of any pest or 
     disease of livestock;
       (B) any animal or progeny of any animal, article, or means 
     of conveyance that has been imported or entered in violation 
     of this subtitle; or
       (C) any animal that has strayed into the United States if 
     the Secretary determines that destruction or removal from the 
     United States is necessary to prevent the introduction into 
     or dissemination within the United States of any pest or 
     disease of livestock.
       (2) Requirements of owners.--
       (A) Orders to disinfect.--The Secretary may require the 
     disinfection of--
       (i) a means of conveyance used in connection with the 
     importation of an animal;
       (ii) an individual involved in the importation of an animal 
     and personal articles of the individual; and
       (iii) any article used in the importation of an animal.
       (B) Failure to comply with orders.--If an owner fails to 
     comply with an order of the Secretary under this section, the 
     Secretary may--
       (i) take remedial action, destroy, or remove from the 
     United States the animal or progeny of any animal, article, 
     or means of conveyance as authorized under paragraph (1); and
       (ii) recover from the owner the costs of any care, 
     handling, disposal, or other action incurred by the Secretary 
     in connection with the remedial action, destruction, or 
     removal.

     SEC. 10405. EXPORTATION.

       (a) In General.--The Secretary may prohibit or restrict--
       (1) the exportation of any animal, article, or means of 
     conveyance if the Secretary determines that the prohibition 
     or restriction is necessary to prevent the dissemination from 
     or within the United States of any pest or disease of 
     livestock;
       (2) the exportation of any livestock if the Secretary 
     determines that the livestock is unfit to be moved;
       (3) the use of any means of conveyance or facility in 
     connection with the exportation of any animal or article if 
     the Secretary determines that the prohibition or restriction 
     is necessary to prevent the dissemination from or within the 
     United States of any pest or disease of livestock; or
       (4) the use of any means of conveyance in connection with 
     the exportation of livestock if the Secretary determines that 
     the prohibition or restriction is necessary because the means 
     of conveyance has not been maintained in a clean and sanitary 
     condition or does not have accommodations for the safe and 
     proper movement and humane treatment of livestock.
       (b) Requirements of Owners.--
       (1) Orders to disinfect.--The Secretary may require the 
     disinfection of--
       (A) a means of conveyance used in connection with the 
     exportation of an animal;
       (B) an individual involved in the exportation of an animal 
     and personal articles of the individual; and
       (C) any article used in the exportation of an animal.
       (2) Failure to comply with orders.--If an owner fails to 
     comply with an order of the Secretary under this section, the 
     Secretary may--
       (A) take remedial action with respect to the animal, 
     article, or means of conveyance referred to in paragraph (1); 
     and
       (B) recover from the owner the costs of any care, handling, 
     disposal, or other action incurred by the Secretary in 
     connection with the remedial action.
       (c) Certification.--The Secretary may certify the 
     classification, quality, quantity, condition, processing, 
     handling, or storage of any animal or article intended for 
     export.

     SEC. 10406. INTERSTATE MOVEMENT.

       The Secretary may prohibit or restrict--
       (1) the movement in interstate commerce of any animal, 
     article, or means of conveyance if the Secretary determines 
     that the prohibition or restriction is necessary to prevent 
     the introduction or dissemination of any pest or disease of 
     livestock; and
       (2) the use of any means of conveyance or facility in 
     connection with the movement in interstate commerce of any 
     animal or article if the Secretary determines that the 
     prohibition or restriction is necessary to prevent the 
     introduction or dissemination of any pest or disease of 
     livestock.

     SEC. 10407. SEIZURE, QUARANTINE, AND DISPOSAL.

       (a) In General.--The Secretary may hold, seize, quarantine, 
     treat, destroy, dispose of, or take other remedial action 
     with respect to--
       (1) any animal or progeny of any animal, article, or means 
     of conveyance that--
       (A) is moving or has been moved in interstate commerce or 
     has been imported and entered; and

[[Page H1890]]

       (B) the Secretary has reason to believe may carry, may have 
     carried, or may have been affected with or exposed to any 
     pest or disease of livestock at the time of movement or that 
     is otherwise in violation of this subtitle;
       (2) any animal or progeny of any animal, article, or means 
     of conveyance that is moving or is being handled, or has 
     moved or has been handled, in interstate commerce in 
     violation of this subtitle;
       (3) any animal or progeny of any animal, article, or means 
     of conveyance that has been imported, and is moving or is 
     being handled or has moved or has been handled, in violation 
     of this subtitle; or
       (4) any animal or progeny of any animal, article, or means 
     of conveyance that the Secretary finds is not being 
     maintained, or has not been maintained, in accordance with 
     any post-importation quarantine, post-importation condition, 
     post-movement quarantine, or post-movement condition in 
     accordance with this subtitle.
       (b) Extraordinary Emergencies.--
       (1) In general.--Subject to paragraph (2), if the Secretary 
     determines that an extraordinary emergency exists because of 
     the presence in the United States of a pest or disease of 
     livestock and that the presence of the pest or disease 
     threatens the livestock of the United States, the Secretary 
     may--
       (A) hold, seize, treat, apply other remedial actions to, 
     destroy (including preventative slaughter), or otherwise 
     dispose of, any animal, article, facility, or means of 
     conveyance if the Secretary determines the action is 
     necessary to prevent the dissemination of the pest or 
     disease; and
       (B) prohibit or restrict the movement or use within a 
     State, or any portion of a State of any animal or article, 
     means of conveyance, or facility if the Secretary determines 
     that the prohibition or restriction is necessary to prevent 
     the dissemination of the pest or disease.
       (2) State action.--
       (A) In general.--The Secretary may take action in a State 
     under this subsection only on finding that measures being 
     taken by the State are inadequate to control or eradicate the 
     pest or disease, after review and consultation with--
       ``(i) the Governor or an appropriate animal health official 
     of the State; or
       ``(ii) in the case of any animal, article, facility, or 
     means of conveyance under the jurisdiction of an Indian 
     tribe, the head of the Indian tribe.
       (B) Notice.--Subject to subparagraph (C), before any action 
     is taken in a State under subparagraph (A), the Secretary 
     shall--
       (i) notify the Governor, an appropriate animal health 
     official of the State, or head of the Indian tribe of the 
     proposed action;
       (ii) issue a public announcement of the proposed action; 
     and
       (iii) publish in the Federal Register--

       (I) the findings of the Secretary;
       (II) a description of the proposed action; and
       (III) a statement of the reasons for the proposed action.

       (C) Notice after action.--If it is not practicable to 
     publish in the Federal Register the information required 
     under subparagraph (B)(iii) before taking action under 
     subparagraph (A), the Secretary shall publish the information 
     as soon as practicable, but not later than 10 business days, 
     after commencement of the action.
       (c) Quarantine, Disposal, or Other Remedial Action.--
       (1) In general.--The Secretary, in writing, may order the 
     owner of any animal, article, facility, or means of 
     conveyance referred to in subsection (a) or (b) to maintain 
     in quarantine, dispose of, or take other remedial action with 
     respect to the animal, article, facility, or means of 
     conveyance, in a manner determined by the Secretary.
       (2) Failure to comply with orders.--If the owner fails to 
     comply with the order of the Secretary, the Secretary may--
       (A) seize, quarantine, dispose of, or take other remedial 
     action with respect to the animal, article, facility, or 
     means of conveyance under subsection (a) or (b); and
       (B) recover from the owner the costs of any care, handling, 
     disposal, or other remedial action incurred by the Secretary 
     in connection with the seizure, quarantine, disposal, or 
     other remedial action.
       (d) Compensation.--
       (1) In general.--Except as provided in paragraph (3), the 
     Secretary shall compensate the owner of any animal, article, 
     facility, or means of conveyance that the Secretary requires 
     to be destroyed under this section.
       (2) Amount.--
       (A) In general.--Subject to subparagraphs (B) and (C), the 
     compensation shall be based on the fair market value, as 
     determined by the Secretary, of the destroyed animal, 
     article, facility, or means of conveyance.
       (B) Limitation.--Compensation paid any owner under this 
     subsection shall not exceed the difference between--
       (i) the fair market value of the destroyed animal, article, 
     facility, or means of conveyance; and
       (ii) any compensation received by the owner from a State or 
     other source for the destroyed animal, article, facility, or 
     means of conveyance.
       (C) Reviewability.--The determination by the Secretary of 
     the amount to be paid under this subsection shall be final 
     and not subject to judicial review or review of longer than 
     60 days by any officer or employee of the Federal Government 
     other than the Secretary or the designee of the Secretary.
       (3) Exceptions.--No payment shall be made by the Secretary 
     under this subsection for--
       (A) any animal, article, facility, or means of conveyance 
     that has been moved or handled by the owner in violation of 
     an agreement for the control and eradication of diseases or 
     pests or in violation of this subtitle;
       (B) any progeny of any animal or article, which animal or 
     article has been moved or handled by the owner of the animal 
     or article in violation of this subtitle;
       (C) any animal, article, or means of conveyance that is 
     refused entry under this subtitle; or
       (D) any animal, article, facility, or means of conveyance 
     that becomes or has become affected with or exposed to any 
     pest or disease of livestock because of a violation of an 
     agreement for the control and eradication of diseases or 
     pests or a violation of this subtitle by the owner.

     SEC. 10408. INSPECTIONS, SEIZURES, AND WARRANTS.

       (a) Guidelines.--The activities authorized by this section 
     shall be carried out consistent with guidelines approved by 
     the Attorney General.
       (b) Warrantless Inspections.--The Secretary may stop and 
     inspect, without a warrant, any person or means of conveyance 
     moving--
       (1) into the United States, to determine whether the person 
     or means of conveyance is carrying any animal or article 
     regulated under this subtitle;
       (2) in interstate commerce, on probable cause to believe 
     that the person or means of conveyance is carrying any animal 
     or article regulated under this subtitle; or
       (3) in intrastate commerce from any State, or any portion 
     of a State, quarantined under section 10407(b), on probable 
     cause to believe that the person or means of conveyance is 
     carrying any animal or article quarantined under section 
     10407(b).
       (c) Inspections With Warrants.--
       (1) In general.--The Secretary may enter, with a warrant, 
     any premises in the United States for the purpose of making 
     inspections and seizures under this subtitle.
       (2) Application and issuance of warrants.--
       (A) In general.--On proper oath or affirmation showing 
     probable cause to believe that there is on certain premises 
     any animal, article, facility, or means of conveyance 
     regulated under this subtitle, a United States judge, a judge 
     of a court of record in the United States, or a United States 
     magistrate judge may issue a warrant for the entry on 
     premises within the jurisdiction of the judge or magistrate 
     to make any inspection or seizure under this subtitle.
       (B) Execution.--The warrant may be applied for and executed 
     by the Secretary or any United States marshal.

     SEC. 10409. DETECTION, CONTROL, AND ERADICATION OF DISEASES 
                   AND PESTS.

       (a) In General.--The Secretary may carry out operations and 
     measures to detect, control, or eradicate any pest or disease 
     of livestock (including the drawing of blood and diagnostic 
     testing of animals), including animals at a slaughterhouse, 
     stockyard, or other point of concentration.
       (b) Compensation.--
       (1) In general.--The Secretary may pay a claim arising out 
     of the destruction of any animal, article, or means of 
     conveyance consistent with the purposes of this subtitle.
       (2) Reviewability.--The action of the Secretary in carrying 
     out paragraph (1) shall not be subject to review of longer 
     than 60 days by any officer or employee of the Federal 
     Government other than the Secretary or the designee of the 
     Secretary.

     SEC. 10410. VETERINARY ACCREDITATION PROGRAM.

       (a) In General.--The Secretary may establish a veterinary 
     accreditation program that is consistent with this subtitle, 
     including the establishment of standards of conduct for 
     accredited veterinarians.
       (b) Consultation.--The Secretary shall consult with State 
     animal health officials and veterinary professionals 
     regarding the establishment of the veterinary accreditation 
     program.
       (c) Suspension or Revocation of Accreditation.--
       (1) In general.--The Secretary may, after notice and 
     opportunity for a hearing on the record, suspend or revoke 
     the accreditation of any veterinarian accredited under this 
     title who violates this subtitle.
       (2) Final order.--The order of the Secretary suspending or 
     revoking accreditation shall be treated as a final order 
     reviewable under chapter 158 of title 28, United States Code.
       (3) Summary suspension.--
       (A) In general.--The Secretary may summarily suspend the 
     accreditation of a veterinarian whom the Secretary has reason 
     to believe knowingly violated this subtitle.
       (B) Hearings.--The Secretary shall provide the veterinarian 
     with a subsequent notice and an opportunity for a prompt 
     post-suspension hearing on the record.
       (d) Application of Penalty Provisions.--The criminal and 
     civil penalties described in section 10414 shall not apply to 
     a violation of this section that is not a violation of any 
     other provision of this subtitle.

     SEC. 10411. COOPERATION.

       (a) In General.--To carry out this subtitle, the Secretary 
     may cooperate with other Federal agencies, States or 
     political subdivisions of States, national governments of 
     foreign countries, local governments of foreign countries, 
     domestic or international organizations, domestic or 
     international associations, Indian tribes, and other persons.
       (b) Responsibility.--The person or other entity cooperating 
     with the Secretary shall be responsible for the authority 
     necessary to carry out operations or measures--
       (1) on all land and property within a foreign country or 
     State, or under the jurisdiction of an Indian tribe, other 
     than on land and property owned or controlled by the United 
     States; and
       (2) using other facilities and means, as determined by the 
     Secretary.
       (c) Screwworms.--
       (1) In general.--The Secretary may, independently or in 
     cooperation with national governments of foreign countries or 
     international

[[Page H1891]]

     organizations or associations, produce and sell sterile 
     screwworms to any national government of a foreign country or 
     international organization or association, if the Secretary 
     determines that the livestock industry and related industries 
     of the United States will not be adversely affected by the 
     production and sale.
       (2) Proceeds.--
       (A) Independent production and sale.--If the Secretary 
     independently produces and sells sterile screwworms under 
     paragraph (1), the proceeds of the sale shall be--
       (i) deposited into the Treasury of the United States; and
       (ii) credited to the account from which the operating 
     expenses of the facility producing the sterile screwworms 
     have been paid.
       (B) Cooperative production and sale.--
       (i) In general.--If the Secretary cooperates to produce and 
     sell sterile screwworms under paragraph (1), the proceeds of 
     the sale shall be divided between the United States and the 
     cooperating national government or international organization 
     or association in a manner determined by the Secretary.
       (ii) Account.--The United States portion of the proceeds 
     shall be--

       (I) deposited into the Treasury of the United States; and
       (II) credited to the account from which the operating 
     expenses of the facility producing the sterile screwworms 
     have been paid.

       (d) Cooperation in Program Administration.--The Secretary 
     may cooperate with State authorities, Indian tribe 
     authorities, or other persons in the administration of 
     regulations for the improvement of livestock and livestock 
     products.
       (e) Consultation and Coordination With Other Federal 
     Agencies.--
       (1) In general.--The Secretary shall consult and coordinate 
     with the head of a Federal agency with respect to any 
     activity that is under the jurisdiction of the Federal 
     agency.
       (2) Lead agency.--Subject to the consultation and 
     coordination requirement in paragraph (1), the Department of 
     Agriculture shall be the lead agency with respect to issues 
     related to pests and diseases of livestock.

     SEC. 10412. REIMBURSABLE AGREEMENTS.

       (a) Authority To Enter Into Agreements.--The Secretary may 
     enter into reimbursable fee agreements with persons for 
     preclearance of animals or articles at locations outside the 
     United States for movement into the United States.
       (b) Funds Collected for Preclearance.--Funds collected for 
     preclearance activities shall--
       (1) be credited to accounts that may be established by the 
     Secretary for carrying out this section; and
       (2) remain available until expended for the preclearance 
     activities, without fiscal year limitation.
       (c) Payment of Employees.--
       (1) In general.--Notwithstanding any other law, the 
     Secretary may pay an officer or employee of the Department of 
     Agriculture performing services under this subtitle relating 
     to imports into and exports from the United States for all 
     overtime, night, or holiday work performed by the officer or 
     employee at a rate of pay determined by the Secretary.
       (2) Reimbursement.--
       (A) In general.--The Secretary may require a person for 
     whom the services are performed to reimburse the Secretary 
     for any expenses paid by the Secretary for the services under 
     this subsection.
       (B) Use of funds.--All funds collected under this 
     subsection shall--
       (i) be credited to the account that incurs the costs; and
       (ii) remain available until expended, without fiscal year 
     limitation.
       (d) Late Payment Penalties.--
       (1) Collection.--On failure by a person to reimburse the 
     Secretary in accordance with this section, the Secretary may 
     assess a late payment penalty against the person, including 
     interest on overdue funds, as required by section 3717 of 
     title 31, United States Code.
       (2) Use of funds.--Any late payment penalty and any accrued 
     interest shall--
       (A) be credited to the account that incurs the costs; and
       (B) remain available until expended, without fiscal year 
     limitation.

     SEC. 10413. ADMINISTRATION AND CLAIMS.

       (a) Administration.--To carry out this subtitle, the 
     Secretary may--
       (1) acquire and maintain real or personal property;
       (2) employ a person;
       (3) make a grant; and
       (4) notwithstanding chapter 63 of title 31, United States 
     Code, enter into a contract, cooperative agreement, 
     memorandum of understanding, or other agreement.
       (b) Tort Claims.--
       (1) In general.--Except as provided in paragraph (2), the 
     Secretary may pay a tort claim, in the manner authorized by 
     the first paragraph of section 2672 of title 28, United 
     States Code, if the claim arises outside the United States in 
     connection with an activity authorized under this subtitle.
       (2) Requirements.--A claim may not be allowed under this 
     subsection unless the claim is presented in writing to the 
     Secretary not later than 2 years after the date on which the 
     claim arises.

     SEC. 10414. PENALTIES.

       (a) Criminal Penalties.--
       (1) Offenses.--
       (A) In general.--A person that knowingly violates this 
     subtitle, or knowingly forges, counterfeits, or, without 
     authority from the Secretary, uses, alters, defaces, or 
     destroys any certificate, permit, or other document provided 
     for in this subtitle shall be fined under title 18, United 
     States Code, imprisoned not more than 1 year, or both.
       (B) Distribution or sale.--A person that knowingly imports, 
     enters, exports, or moves any animal or article, for 
     distribution or sale, in violation of this subtitle, shall be 
     fined under title 18, United States Code, imprisoned not more 
     than 5 years, or both.
       (2) Multiple violations.--On the second and any subsequent 
     conviction of a person of a violation of this subtitle under 
     paragraph (1), the person shall be fined under title 18, 
     United States Code, imprisoned not more than 10 years, or 
     both.
       (b) Civil Penalties.--
       (1) In general.--Except as provided in section 10410(d), 
     any person that violates this subtitle, or that forges, 
     counterfeits, or, without authority from the Secretary, uses, 
     alters, defaces, or destroys any certificate, permit, or 
     other document provided under this subtitle may, after notice 
     and opportunity for a hearing on the record, be assessed a 
     civil penalty by the Secretary that does not exceed the 
     greater of--
       (A)(i) $50,000 in the case of any individual, except that 
     the civil penalty may not exceed $1,000 in the case of an 
     initial violation of this subtitle by an individual moving 
     regulated articles not for monetary gain;
       (ii) $250,000 in the case of any other person for each 
     violation; and
       (iii) $500,000 for all violations adjudicated in a single 
     proceeding; or
       (B) twice the gross gain or gross loss for any violation or 
     forgery, counterfeiting, or unauthorized use, alteration, 
     defacing or destruction of a certificate, permit, or other 
     document provided under this subtitle that results in the 
     person's deriving pecuniary gain or causing pecuniary loss to 
     another person.
       (2) Factors in determining civil penalty.--In determining 
     the amount of a civil penalty, the Secretary shall take into 
     account the nature, circumstance, extent, and gravity of the 
     violation or violations and the Secretary may consider, with 
     respect to the violator--
       (A) the ability to pay;
       (B) the effect on ability to continue to do business;
       (C) any history of prior violations;
       (D) the degree of culpability; and
       (E) such other factors as the Secretary considers to be 
     appropriate.
       (3) Settlement of civil penalties.--The Secretary may 
     compromise, modify, or remit, with or without conditions, any 
     civil penalty that may be assessed under this subsection.
       (4) Finality of orders.--
       (A) Final order.--The order of the Secretary assessing a 
     civil penalty shall be treated as a final order reviewable 
     under chapter 158 of title 28, United States Code.
       (B) Review.--The validity of the order of the Secretary may 
     not be reviewed in an action to collect the civil penalty.
       (C) Interest.--Any civil penalty not paid in full when due 
     under an order assessing the civil penalty shall thereafter 
     accrue interest until paid at the rate of interest applicable 
     to civil judgments of the courts of the United States.
       (c) Liability for Acts of Agents.--In the construction and 
     enforcement of this subtitle, the act, omission, or failure 
     of any officer, agent, or person acting for or employed by 
     any other person within the scope of the employment or office 
     of the officer, agent, or person, shall be deemed also to be 
     the act, omission, or failure of the other person.
       (d) Guidelines for Civil Penalties.--Subject to the 
     approval of the Attorney General, the Secretary shall 
     establish guidelines to determine under what circumstances 
     the Secretary may issue a civil penalty or suitable notice of 
     warning in lieu of prosecution by the Attorney General of a 
     violation of this subtitle.

     SEC. 10415. ENFORCEMENT.

       (a) Collection of Information.--
       (1) In general.--The Secretary may gather and compile 
     information and conduct any inspection or investigation that 
     the Secretary considers to be necessary for the 
     administration or enforcement of this subtitle.
       (2) Subpoenas.--
       (A) In general.--The Secretary shall have power to issue a 
     subpoena to compel the attendance and testimony of any 
     witness and the production of any documentary evidence 
     relating to the administration or enforcement of this 
     subtitle or any matter under investigation in connection with 
     this subtitle.
       (B) Location of production.--The attendance of any witness 
     and production of documentary evidence relevant to the 
     inquiry may be required from any place in the United States.
       (C) Enforcement.--
       (i) In general.--In case of disobedience to a subpoena by 
     any person, the Secretary may request the Attorney General to 
     invoke the aid of any court of the United States within the 
     jurisdiction in which the investigation is conducted, or 
     where the person resides, is found, transacts business, is 
     licensed to do business, or is incorporated, to require the 
     attendance and testimony of any witness and the production of 
     documentary evidence.
       (ii) Noncompliance.--In case of a refusal to obey a 
     subpoena issued to any person, a court may order the person 
     to appear before the Secretary and give evidence concerning 
     the matter in question or to produce documentary evidence.
       (iii) Contempt.--Any failure to obey the order of the court 
     may be punished by the court as contempt of the court.
       (D) Compensation.--
       (i) Witnesses.--A witness summoned by the Secretary under 
     this subtitle shall be paid the same fees and mileage that 
     are paid to a witness in a court of the United States.
       (ii) Depositions.--A witness whose deposition is taken, and 
     the person taking the deposition,

[[Page H1892]]

     shall be entitled to the same fees that are paid for similar 
     services in a court of the United States.
       (E) Procedures.--
       (i) Publication.--The Secretary shall publish procedures 
     for the issuance of subpoenas under this section.
       (ii) Review.--The procedures shall include a requirement 
     that subpoenas be reviewed for legal sufficiency and, to be 
     effective, be signed by the Secretary.
       (iii) Delegation.--If the authority to sign a subpoena is 
     delegated to an agency other than the Office of 
     Administrative Law Judges, the agency receiving the 
     delegation shall seek review of the subpoena for legal 
     sufficiency outside that agency.
       (b) Authority of Attorney General.--The Attorney General 
     may--
       (1) prosecute, in the name of the United States, all 
     criminal violations of this subtitle that are referred to the 
     Attorney General by the Secretary or are brought to the 
     notice of the Attorney General by any person;
       (2) bring an action to enjoin the violation of or to compel 
     compliance with this subtitle, or to enjoin any interference 
     by any person with the Secretary in carrying out this 
     subtitle, in any case in which the Secretary has reason to 
     believe that the person has violated, or is about to violate 
     this subtitle or has interfered, or is about to interfere, 
     with the actions of the Secretary; or
       (3) bring an action for the recovery of any unpaid civil 
     penalty, funds under a reimbursable agreement, late payment 
     penalty, or interest assessed under this subtitle.
       (c) Court Jurisdiction.--
       (1) In general.--The United States district courts, the 
     District Court of Guam, the District Court of the Northern 
     Mariana Islands, the District Court of the Virgin Islands, 
     the highest court of American Samoa, and the United States 
     courts of the other territories and possessions are vested 
     with jurisdiction in all cases arising under this subtitle.
       (2) Venue.--Any action arising under this subtitle may be 
     brought, and process may be served, in the judicial district 
     where a violation or interference occurred or is about to 
     occur, or where the person charged with the violation, 
     interference, impending violation, impending interference, or 
     failure to pay resides, is found, transacts business, is 
     licensed to do business, or is incorporated.
       (3) Exception.--Paragraphs (1) and (2) do not apply to 
     sections 10410(c) and 10414(b).

     SEC. 10416. REGULATIONS AND ORDERS.

       The Secretary may promulgate such regulations, and issue 
     such orders, as the Secretary determines necessary to carry 
     out this subtitle.

     SEC. 10417. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--There are authorized to be appropriated 
     such sums as are necessary to carry out this subtitle.
       (b) Transfer of Funds.--
       (1) In general.--In connection with an emergency under 
     which a pest or disease of livestock threatens any segment of 
     agricultural production in the United States, the Secretary 
     may transfer from other appropriations or funds available to 
     the agencies or corporations of the Department of Agriculture 
     such funds as the Secretary determines are necessary for the 
     arrest, control, eradication, or prevention of the spread of 
     the pest or disease of livestock and for related expenses.
       (2) Availability.--Any funds transferred under this 
     subsection shall remain available until expended, without 
     fiscal year limitation.
       (3) Reviewability.--The action of any officer, employee, or 
     agent of the Secretary in carrying out this section 
     (including determining the amount of and making any payment 
     authorized to be made under this subtitle) shall not be 
     subject to review of longer than 60 days by any officer or 
     employee of the Federal Government other than the Secretary 
     or the designee of the Secretary.
       (c) Use of Funds.--In carrying out this subtitle, the 
     Secretary may use funds made available to carry out this 
     subtitle for--
       (1) the employment of civilian nationals in foreign 
     countries; and
       (2) the construction and operation of research 
     laboratories, quarantine stations, and other buildings and 
     facilities for special purposes.

     SEC. 10418. REPEALS AND CONFORMING AMENDMENTS.

       (a) Repeals.--The following provisions of law are repealed:
       (1) Public Law 97-46 (7 U.S.C. 147b).
       (2) Section 101(b) of the Act of September 21, 1944 (7 
     U.S.C. 429).
       (3) The Act of August 28, 1950 (7 U.S.C. 2260).
       (4) Section 919 of the Federal Agriculture Improvement and 
     Reform Act of 1996 (7 U.S.C. 2260a).
       (5) Section 306 of the Tariff Act of 1930 (19 U.S.C. 1306).
       (6) Sections 6 through 8 and 10 of the Act of August 30, 
     1890 (21 U.S.C. 102 through 105).
       (7) The Act of February 2, 1903 (21 U.S.C. 111, 120 through 
     122).
       (8) Sections 2 through 9, 11, and 13 of the Act of May 29, 
     1884 (21 U.S.C. 112, 113, 114, 114a, 114a-1, 115 through 120, 
     130).
       (9) The first section and sections 2, 3, and 5 of the Act 
     of February 28, 1947 (21 U.S.C. 114b, 114c, 114d, 114d-1).
       (10) The Act of June 16, 1948 (21 U.S.C. 114e, 114f).
       (11) Public Law 87-209 (21 U.S.C. 114g, 114h).
       (12) The third and fourth provisos of the fourth paragraph 
     under the heading ``bureau of animal industry'' of the Act of 
     May 31, 1920 (21 U.S.C. 116).
       (13) The first section and sections 2, 3, 4, and 6 of the 
     Act of March 3, 1905 (21 U.S.C. 123 through 127).
       (14) The first proviso under the heading ``General 
     expenses, Bureau of Animal Industry'' under the heading 
     ``BUREAU OF ANIMAL INDUSTRY'' of the Act of June 30, 1914 (21 
     U.S.C. 128).
       (15) The fourth proviso under the heading ``salaries and 
     expenses'' under the heading ``Animal and Plant Health 
     Inspection Service'' of title I of the Agriculture, Rural 
     Development, Food and Drug Administration, and Related 
     Agencies Appropriations Act, 2001 (21 U.S.C. 129).
       (16) The third paragraph under the heading 
     ``MISCELLANEOUS'' of the Act of May 26, 1910 (21 U.S.C. 131).
       (17) The first section and sections 2 through 6 and 11 
     through 13 of Public Law 87-518 (21 U.S.C. 134 through 134h).
       (18) Public Law 91-239 (21 U.S.C. 135 through 135b).
       (19) Sections 12 through 14 of the Federal Meat Inspection 
     Act (21 U.S.C. 612 through 614).
       (20) Chapter 39 of title 46, United States Code.
       (b) Conforming Amendments.--
       (1) Section 414(b) of the Plant Protection Act (7 U.S.C. 
     7714(b)) is amended--
       (A) in paragraph (1), by striking ``, or the owner's 
     agent,''; and
       (B) in paragraph (2), by striking ``or agent of the owner'' 
     each place it appears.
       (2) Section 423 of the Plant Protection Act (7 U.S.C. 7733) 
     is amended--
       (A) by striking subsection (b) and inserting the following:
       ``(b) Location of Production.--The attendance of any 
     witness and production of documentary evidence relevant to 
     the inquiry may be required from any place in the United 
     States.'';
       (B) in the third sentence of subsection (e), by inserting 
     ``to an agency other than the Office of Administrative Law 
     Judges'' after ``is delegated''; and
       (C) by striking subsection (f).
       (3) Section 11(h) of the Endangered Species Act of 1973 (16 
     U.S.C. 1540(h)) is amended in the first sentence by striking 
     ``animal quarantine laws (21 U.S.C. 101-105, 111-135b, and 
     612-614)'' and inserting ``animal quarantine laws (as defined 
     in section 2509(f) of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (21 U.S.C. 136a(f))''.
       (4) Section 18 of the Federal Meat Inspection Act (21 
     U.S.C. 618) is amended by striking ``of the cattle'' and all 
     that follows through ``as herein described'' and inserting 
     ``of the carcasses and products of cattle, sheep, swine, 
     goats, horses, mules, and other equines''.
       (5) Section 2509 of the Food, Agriculture, Conservation, 
     and Trade Act of 1990 (21 U.S.C. 136a) is amended--
       (A) in subsection (c), by inserting after paragraph (1) the 
     following:
       ``(2) Veterinary diagnostics.--The Secretary may prescribe 
     and collect fees to recover the costs of carrying out the 
     provisions of the Animal Health Protection Act that relate to 
     veterinary diagnostics.''; and
       (B) in subsection (f)(1), by striking subparagraphs (B) 
     through (O) and inserting the following:
       ``(B) section 9 of the Act of August 30, 1890 (21 U.S.C. 
     101);
       ``(C) the Animal Health Protection Act; or
       ``(D) any other Act administered by the Secretary relating 
     to plant or animal diseases or pests.''.
       (c) Effect on Regulations.--A regulation issued under a 
     provision of law repealed by subsection (a) shall remain in 
     effect until the Secretary issues a regulation under section 
     10404(b) or 10416 that supersedes the earlier regulation.
                         Subtitle F--Livestock

     SEC. 10501. TRANSPORTATION OF POULTRY AND OTHER ANIMALS.

       Section 5402(d)(2) of title 39, United States Code, is 
     amended--
       (1) in subparagraph (A), by inserting ``, honeybees,'' 
     after ``poultry''; and
       (2) by striking subparagraph (C).

     SEC. 10502. SWINE CONTRACTORS.

       (a) Definitions.--Section 2(a) of the Packers and 
     Stockyards Act, 1921 (7 U.S.C. 182(a)), is amended by adding 
     at the end the following:
       ``(12) Swine contractor.--The term `swine contractor' means 
     any person engaged in the business of obtaining swine under a 
     swine production contract for the purpose of slaughtering the 
     swine or selling the swine for slaughter, if--
       ``(A) the swine is obtained by the person in commerce; or
       ``(B) the swine (including products from the swine) 
     obtained by the person is sold or shipped in commerce.
       ``(13) Swine production contract.--The term `swine 
     production contract' means any growout contract or other 
     arrangement under which a swine production contract grower 
     raises and cares for the swine in accordance with the 
     instructions of another person.
       ``(14) Swine production contract grower.--The term `swine 
     production contract grower' means any person engaged in the 
     business of raising and caring for swine in accordance with 
     the instructions of another person.''.
       (b) Swine Contractors.--
       (1) In general.--The Packers and Stockyards Act, 1921, is 
     amended by striking ``packer'' each place it appears in 
     sections 202, 203, 204, and 205 (7 U.S.C. 192, 193, 194, 195) 
     (other than section 202(c)) and inserting ``packer or swine 
     contractor''.
       (2) Conforming amendments.--
       (A) Section 202(c) of the Packers and Stockyards Act, 1921 
     (7 U.S.C. 192(c)), is amended by inserting ``, swine 
     contractor,'' after ``other packer'' each place it appears.
       (B) Section 308(a) of the Packers and Stockyards Act, 1921 
     (7 U.S.C. 209(a)), is amended by inserting ``or swine 
     production contract'' after ``poultry growing arrangement''.
       (C) Sections 401 and 403 of the Packers and Stockyards Act, 
     1921 (7 U.S.C. 221, 223), are

[[Page H1893]]

     amended by inserting ``any swine contractor, and'' after 
     ``packer,'' each place it appears.

     SEC. 10503. RIGHT TO DISCUSS TERMS OF CONTRACT.

       (a) Definitions.--In this section:
       (1) Producer.--The term ``producer'' means any person 
     engaged in the raising and caring for livestock or poultry 
     for slaughter.
       (2) Processor.--The term ``processor'' means any person 
     engaged in the business of obtaining livestock or poultry for 
     the purpose of slaughtering the livestock or poultry.
       (b) No Prohibition of Discussion.--Notwithstanding a 
     provision in any contract between a producer and a processor 
     for the production of livestock or poultry, or in any 
     marketing agreement between a producer and a processor for 
     the sale of livestock or poultry for a term of 1 year or 
     more, that provides that information contained in the 
     contract is confidential, a party to the contract shall not 
     be prohibited from discussing any terms or details of the 
     contract with--
       (1) a Federal or State agency;
       (2) a legal adviser to the party;
       (3) a lender to the party;
       (4) an accountant hired by the party;
       (5) an executive or manager of the party;
       (6) a landlord of the party; or
       (7) a member of the immediate family of the party.
       (c) Effect on State Laws.--Subsection (b) does not--
       (1) preempt any State law that addresses confidentiality 
     provisions in contracts for the sale or production of 
     livestock or poultry, except any provision of State law that 
     makes lawful a contract provision that prohibits a party 
     from, or limits a party in, engaging in discussion that 
     subsection (b) requires to be permitted; or
       (2) deprive any State court of jurisdiction under any such 
     State law.
       (d) Applicability.--This section applies to each contract 
     described in subsection (b) that is entered into, amended, 
     renewed, or extended after the date of enactment of this Act.

     SEC. 10504. VETERINARY TRAINING.

       The Secretary of Agriculture may develop a program to 
     maintain in all regions of the United States a sufficient 
     number of Federal and State veterinarians who are well 
     trained in recognition and diagnosis of exotic and endemic 
     animal diseases.

     SEC. 10505. PSEUDORABIES ERADICATION PROGRAM.

       Section 2506(d) of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (21 U.S.C. 114i(d)) is amended by striking 
     ``2002'' and inserting ``2007''.
                      Subtitle G--Specialty Crops

     SEC. 10601. MARKETING ORDERS FOR CANEBERRIES.

       (a) In General.--Section 8c of the Agricultural Adjustment 
     Act (7 U.S.C. 608c), reenacted with amendments by the 
     Agricultural Marketing Agreement Act of 1937, is amended--
       (1) in subsection (2)(A), by inserting ``caneberries 
     (including raspberries, blackberries, and loganberries),'' 
     after ``other than pears, olives, grapefruit, cherries,''; 
     and
       (2) in subsection (6)(I), by striking ``tomatoes,,'' and 
     inserting ``tomatoes, caneberries (including raspberries, 
     blackberries, and loganberries),''.
       (b) Conforming Amendment.--Section 8e(a) of the 
     Agricultural Adjustment Act (7 U.S.C. 608e-l(a)), reenacted 
     with amendments by the Agricultural Marketing Agreement Act 
     of 1937, is amended in the first sentence by striking ``or 
     apples'' and inserting ``apples, or caneberries (including 
     raspberries, blackberries, and loganberries)''.

     SEC. 10602. AVAILABILITY OF SECTION 32 FUNDS.

       The second undesignated paragraph of section 32 of the Act 
     of August 24, 1935 (7 U.S.C. 612c), is amended by striking 
     ``$300,000,000'' and inserting ``$500,000,000''.

     SEC. 10603. PURCHASE OF SPECIALTY CROPS.

       (a) General Purchase Authority.--Of the funds made 
     available under section 32 of the Act of August 24, 1935 (7 
     U.S.C. 612c), for fiscal year 2002 and each subsequent fiscal 
     year, the Secretary of Agriculture shall use not less than 
     $200,000,000 each fiscal year to purchase fruits, vegetables, 
     and other specialty food crops.
       (b) Purchase Authority.--
       (1) Purchase.--Of the amount specified in subsection (a), 
     the Secretary of Agriculture shall use not less than 
     $50,000,000 each fiscal year for the purchase of fresh fruits 
     and vegetables for distribution to schools and service 
     institutions in accordance with section 6(a) of the Richard 
     B. Russell National School Lunch Act (42 U.S.C. 1755(a)).
       (2) Servicing agency.--The Secretary of Agriculture shall 
     provide for the Secretary of Defense to serve as the 
     servicing agency for the procurement of the fresh fruits and 
     vegetables under this subsection on the same terms and 
     conditions as provided in the memorandum of agreement entered 
     into between the Agricultural Marketing Service, the Food and 
     Consumer Service, and the Defense Personnel Support Center 
     during August 1995 (or any successor memorandum of 
     agreement).
       (c) Definitions.--In this section, the terms ``fruits'', 
     ``vegetables'', and ``other specialty food crops'' shall have 
     the meaning given the terms by the Secretary of Agriculture.

     SEC. 10604. PROTECTION FOR PURCHASERS OF FARM PRODUCTS.

       (a) Definition of Effective Financing Statement.--Section 
     1324(c)(4) of the Food Security Act of 1985 (7 U.S.C. 
     1631(c)(4)) is amended--
       (1) in subparagraph (B), by striking ``signed'' and 
     inserting ``signed, authorized, or otherwise authenticated by 
     the debtor,'';
       (2) by striking subparagraph (C);
       (3) in subparagraph (D)--
       (A) in clause (iii), by adding ``and'' after the semicolon 
     at the end; and
       (B) in clause (iv), by striking ``applicable;'' and all 
     that follows and inserting ``applicable, and the name of each 
     county or parish in which the farm products are produced or 
     located;'';
       (4) in subparagraph (E), by striking ``signed'' and 
     inserting ``signed, authorized, or otherwise authenticated by 
     the debtor'';
       (5) in subparagraph (G), by striking ``notice signed'' and 
     inserting ``notice signed, authorized, or otherwise 
     authenticated''; and
       (6) by redesignating subparagraphs (D) through (I) as 
     subparagraphs (C) through (H), respectively.
       (b) Purchases Subject to Security Interests.--Section 
     1324(e) of the Food Security Act of 1985 (7 U.S.C. 1631(e)) 
     is amended--
       (1) in paragraph (1)(A)(ii)--
       (A) in subclause (III), by adding ``and'' after the 
     semicolon at the end; and
       (B) in subclause (IV), by striking ``crop year,'' and all 
     that follows and inserting ``crop year, and the name of each 
     county or parish in which the farm products are produced or 
     located;'';
       (2) in paragraph (1)(A)(iii), by striking ``similarly 
     signed'' and inserting ``similarly signed, authorized, or 
     otherwise authenticated'';
       (3) in paragraph (1)(A)(iv), by striking ``notice signed'' 
     and inserting ``notice signed, authorized, or otherwise 
     authenticated'';
       (4) in paragraph (1)(A)(v), by inserting ``contains'' 
     before ``any payment''; and
       (5) in paragraph (3)--
       (A) in subparagraph (A), by striking ``subparagraph'' and 
     inserting ``subsection''; and
       (B) in subparagraph (B), by striking ``; and'' and 
     inserting a period.
       (c) Certain Sales Subject to Security Interest.--Section 
     1324(g)(2)(A) of the Food Security Act of 1985 (7 U.S.C. 
     1631(g)(2)(A)) is amended--
       (1) in clause (ii)--
       (A) in subclause (III), by adding ``and'' after the 
     semicolon at the end; and
       (B) in subclause (IV), by striking ``crop year,'' and all 
     that follows and inserting ``crop year, and the name of each 
     county or parish in which the farm products are produced or 
     located;'';
       (2) in clause (iii), by striking ``similarly signed'' and 
     inserting ``similarly signed, authorized, or otherwise 
     authenticated'';
       (3) in clause (iv), by striking ``notice signed'' and 
     inserting ``notice signed, authorized, or otherwise 
     authenticated''; and
       (4) in clause (v), by inserting ``contains'' before ``any 
     payment''.

     SEC. 10605. FARMERS' MARKET PROMOTION PROGRAM.

       (a) In General.--The Farmer-to-Consumer Direct Marketing 
     Act of 1976 is amended by inserting after section 5 (7 U.S.C. 
     3004) the following:

     ``SEC. 6. FARMERS' MARKET PROMOTION PROGRAM.

       ``(a) Establishment.--The Secretary shall carry out a 
     program, to be known as the `Farmers' Market Promotion 
     Program' (referred to in this section as the `Program'), to 
     make grants to eligible entities for projects to establish, 
     expand, and promote farmers' markets.
       ``(b) Program Purposes.--
       ``(1) In general.--The purposes of the Program are--
       ``(A) to increase domestic consumption of agricultural 
     commodities by improving and expanding, or assisting in the 
     improvement and expansion of, domestic farmers' markets, 
     roadside stands, community-supported agriculture programs, 
     and other direct producer-to-consumer market opportunities; 
     and
       ``(B) to develop, or aid in the development of, new 
     farmers' markets, roadside stands, community-supported 
     agriculture programs, and other direct producer-to-consumer 
     infrastructure.
       ``(2) Limitations.--An eligible entity may not use a grant 
     or other assistance provided under the Program for the 
     purchase, construction, or rehabilitation of a building or 
     structure.
       ``(c) Eligible Entities.--An entity shall be eligible to 
     receive a grant under the Program if the entity is--
       ``(1) an agricultural cooperative;
       ``(2) a local government;
       ``(3) a nonprofit corporation;
       ``(4) a public benefit corporation;
       ``(5) an economic development corporation;
       ``(6) a regional farmers' market authority; or
       ``(7) such other entity as the Secretary may designate.
       ``(d) Criteria and Guidelines.--The Secretary shall 
     establish criteria and guidelines for the submission, 
     evaluation, and funding of proposed projects under the 
     Program.
       ``(e) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as are necessary to 
     carry out this section for each of fiscal years 2002 through 
     2007.''.
       (b) Technical and Conforming Amendments.--
       (1) Survey.--Section 4 of the Farmer-to-Consumer Direct 
     Marketing Act of 1976 (7 U.S.C. 3003) is amended--
       (A) in the first sentence, by striking ``a continuing'' and 
     inserting ``an annual''; and
       (B) by striking the second sentence.
       (2) Direct marketing assistance.--Section 5 of the Farmer-
     to-Consumer Direct Marketing Act of 1976 (7 U.S.C. 3004) is 
     amended--
       (A) in subsection (a)--
       (i) in the first sentence, by striking ``Extension Service 
     of the United States Department of Agriculture'' and 
     inserting ``Secretary''; and
       (ii) in the second sentence--

       (I) by striking ``Extension Service'' and inserting 
     ``Secretary''; and
       (II) by striking ``and on the basis of which of these two 
     agencies, or combination thereof, can best perform these 
     activities'' and inserting ``, as determined by the 
     Secretary'';

       (B) by redesignating subsection (b) as subsection (c); and

[[Page H1894]]

       (C) by inserting after subsection (a) the following:
       ``(b) Development of Farmers' Markets.--The Secretary 
     shall--
       ``(1) work with the Governor of a State, and a State agency 
     designated by the Governor, to develop programs to train 
     managers of farmers' markets;
       ``(2) develop opportunities to share information among 
     managers of farmers' markets;
       ``(3) establish a program to train cooperative extension 
     service employees in the development of direct marketing 
     techniques; and
       ``(4) work with producers to develop farmers' markets.''.

     SEC. 10606. NATIONAL ORGANIC CERTIFICATION COST-SHARE 
                   PROGRAM.

       (a) In General.--Of funds of the Commodity Credit 
     Corporation, the Secretary of Agriculture (acting through the 
     Agricultural Marketing Service) shall use $5,000,000 for 
     fiscal year 2002, to remain available until expended, to 
     establish a national organic certification cost-share program 
     to assist producers and handlers of agricultural products in 
     obtaining certification under the national organic production 
     program established under the Organic Foods Production Act of 
     1990 (7 U.S.C. 6501 et seq.).
       (b) Federal Share.--
       (1) In general.--Subject to paragraph (2), the Secretary 
     shall pay under this section not more than 75 percent of the 
     costs incurred by a producer or handler in obtaining 
     certification under the national organic production program, 
     as certified to and approved by the Secretary.
       (2) Maximum amount.--The maximum amount of a payment made 
     to a producer or handler under this section shall be $500.

     SEC. 10607. EXEMPTION OF CERTIFIED ORGANIC PRODUCTS FROM 
                   ASSESSMENTS.

       (a) In General.--Section 501 of the Federal Agriculture 
     Improvement and Reform Act of 1996 (7 U.S.C. 7401) is amended 
     by adding at the end the following:
       ``(e) Exemption of Certified Organic Products from 
     Assessments.--
       ``(1) In general.--Notwithstanding any provision of a 
     commodity promotion law, a person that produces and markets 
     solely 100 percent organic products, and that does not 
     produce any conventional or nonorganic products, shall be 
     exempt from the payment of an assessment under a commodity 
     promotion law with respect to any agricultural commodity that 
     is produced on a certified organic farm (as defined in 
     section 2103 of the Organic Foods Production Act of 1990 (7 
     U.S.C. 6502)).
       ``(2) Regulations.--Not later than 1 year after the date of 
     enactment of this subsection, the Secretary shall promulgate 
     regulations concerning eligibility and compliance for an 
     exemption under paragraph (1).''.
       (b) Technical Amendments.--Section 501(a) of the Federal 
     Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 
     7401(a)) is amended--
       (1) in paragraph (17), by striking ``or'';
       (2) in paragraph (18), by striking the period and inserting 
     ``; or''; and
       (3) by adding at the end the following:
       ``(19) any other provision of law enacted after April 4, 
     1996, that provides for the establishment and operation of a 
     promotion program described in the first sentence.''.

     SEC. 10608. CRANBERRY ACREAGE RESERVE PROGRAM.

       (a) Definitions.--In this section:
       (1) Eligible area.--The term ``eligible area'' means a 
     wetland or buffer strip adjacent to a wetland that, as 
     determined by the Secretary--
       (A)(i) is used, and has a history of being used, for the 
     cultivation of cranberries; or
       (ii) is an integral component of a cranberry-growing 
     operation;
       (B) is located in an environmentally sensitive area.
       (2) Secretary.--The term ``Secretary'' means the Secretary 
     of Agriculture.
       (b) Program.--The Secretary shall establish a program to 
     purchase permanent easements in eligible areas from willing 
     sellers.
       (c) Purchase Price.--The Secretary shall ensure, to the 
     maximum extent practicable, that each easement purchased 
     under this section is for an amount that appropriately 
     reflects the range of values for agricultural and 
     nonagricultural land in the region in which the eligible area 
     subject to the easement is located (including whether that 
     land is located in 1 or more environmentally sensitive areas, 
     as determined by the Secretary).
       (d) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $10,000,000.
                       Subtitle H--Administration

     SEC. 10701. INITIAL RATE OF BASIC PAY FOR EMPLOYEES OF COUNTY 
                   COMMITTEES.

       Section 5334 of title 5, United States Code, is amended by 
     striking subsection (e) and inserting the following:
       ``(e) An employee of a county committee established 
     pursuant to section 8(b) of the Soil Conservation and 
     Domestic Allotment Act (16 U.S.C. 590h(b)) may, on 
     appointment to a position subject to this subchapter, have 
     the initial rate of basic pay of the employee fixed at--
       ``(1) the lowest rate of the higher grade that exceeds the 
     rate of basic pay of the employee with the county committee 
     by not less than 2 step-increases of the grade from which the 
     employee was promoted, if the Federal Civil Service position 
     under this subchapter is at a higher grade than the last 
     grade the employee had while an employee of the county 
     committee;
       ``(2) the same step of the grade as the employee last held 
     during service with the county committee, if the Federal 
     Civil Service position under this subchapter is at the same 
     grade as the last grade the employee had while an employee of 
     the county committee; or
       ``(3) the lowest step of the Federal grade for which the 
     rate of basic pay is equal to or greater than the highest 
     previous rate of pay of the employee, if the Federal Civil 
     Service position under this subchapter is at a lower grade 
     than the last grade the employee had while an employee of the 
     county committee.''.

     SEC. 10702. COMMODITY FUTURES TRADING COMMISSION PAY 
                   COMPARABILITY.

       (a) Appointment and Compensation of Employees of the 
     Commission.--Section 2(a) of the Commodity Exchange Act (7 
     U.S.C. 2(a)) is amended--
       (1) by redesignating paragraphs (7) through (11) as 
     paragraphs (8) through (12), respectively; and
       (2) by inserting after paragraph (6) the following:
       ``(7) Appointment and compensation.--
       ``(A) In general.--The Commission may appoint and fix the 
     compensation of such officers, attorneys, economists, 
     examiners, and other employees as may be necessary for 
     carrying out the functions of the Commission under this Act.
       ``(B) Rates of pay.--Rates of basic pay for all employees 
     of the Commission may be set and adjusted by the Commission 
     without regard to chapter 51 or subchapter III of chapter 53 
     of title 5, United States Code.
       ``(C) Comparability.--
       ``(i) In general.--The Commission may provide additional 
     compensation and benefits to employees of the Commission if 
     the same type of compensation or benefits are provided by any 
     agency referred to in section 1206(a) of the Financial 
     Institutions Reform, Recovery, and Enforcement Act of 1989 
     (12 U.S.C. 1833b(a)) or could be provided by such an agency 
     under applicable provisions of law (including rules and 
     regulations).
       ``(ii) Consultation.--In setting and adjusting the total 
     amount of compensation and benefits for employees, the 
     Commission shall consult with, and seek to maintain 
     comparability with, the agencies referred to in section 
     1206(a) of the Financial Institutions Reform, Recovery, and 
     Enforcement Act of 1989 (12 U.S.C. 1833b(a)).''.
       (b) Reporting of Information by the Commission.--Section 
     1206 of the Financial Institutions Reform, Recovery, and 
     Enforcement Act of 1989 (12 U.S.C. 1833b) is amended--
       (1) by striking ``The Federal'' and inserting the 
     following:
       ``(a) In General.--The Federal''; and
       (2) by adding at the end the following:
       ``(b) Commodity Futures Trading Commission.--In 
     establishing and adjusting schedules of compensation and 
     benefits for employees of the Commodity Futures Trading 
     Commission under applicable provisions of law, the Commission 
     shall--
       ``(1) inform the heads of the agencies referred to in 
     subsection (a) and Congress of such compensation and 
     benefits; and
       ``(2) seek to maintain comparability with those agencies 
     regarding compensation and benefits.''.
       (c) Conforming Amendments.--
       (1) Section 3132(a)(1) of title 5, United States Code, is 
     amended--
       (A) in subparagraph (C), by striking ``or'' at the end;
       (B) in subparagraph (D), by adding ``or'' at the end; and
       (C) by adding at the end the following:
       ``(E) the Commodity Futures Trading Commission;''.
       (2) Section 5316 of title 5, United States Code, is 
     amended--
       (A) by striking ``General Counsel, Commodity Futures 
     Trading Commission.''; and
       (B) by striking ``Executive Director, Commodity Futures 
     Trading Commission.''.
       (3) Section 5373(a) of title 5, United States Code, is 
     amended--
       (A) in paragraph (2), by striking ``or'' at the end;
       (B) in paragraph (3), by striking the period at the end and 
     inserting ``; or''; and
       (C) by adding at the end the following:
       ``(4) section 2(a)(7) of the Commodity Exchange Act (7 
     U.S.C. 2(a)(7)).''.

     SEC. 10703. OVERTIME AND HOLIDAY PAY.

       (a) In General.--The Secretary of Agriculture may--
       (1) pay employees of the Department of Agriculture employed 
     in an establishment subject to the Federal Meat Inspection 
     Act (21 U.S.C. 601 et seq.) or the Poultry Products 
     Inspection Act (21 U.S.C. 451 et seq.) for all overtime and 
     holiday work performed at the establishment at rates 
     determined by the Secretary, subject to applicable law 
     relating to minimum wages and maximum hours; and
       (2) accept from the establishment reimbursement for any 
     sums paid by the Secretary for the overtime and holiday work, 
     at rates determined under paragraph (1).
       (b) Availability.--Sums received by the Secretary under 
     this section shall remain available until expended without 
     further appropriation and without fiscal year limitation, to 
     carry out subsection (a).
       (c) Conforming Amendments.--
       (1) Section 25 of the Poultry Products Inspection Act (21 
     U.S.C. 468) is amended by striking ``except that the cost'' 
     and all that follows and inserting ``except the cost of 
     overtime and holiday pay paid pursuant to the section 10703 
     of the Farm Security and Rural Investment Act of 2002.''.
       (2) The Act of June 5, 1948 (21 U.S.C. 695), is amended by 
     striking ``overtime'' and all that follows and inserting 
     ``overtime and holiday pay paid pursuant to section 10703 of 
     the Farm Security and Rural Investment Act of 2002.''.
       (3) The matter under the heading ``bureau of animal 
     industry'' of the Act of July 24, 1919, is amended by 
     striking the next to the last paragraph (7 U.S.C. 394).
       (4) Section 5549 of title 5, United States Code is amended 
     by striking paragraph (1) and inserting the following:

[[Page H1895]]

       ``(1) section 10703 of the Farm Security and Rural 
     Investment Act of 2002;''.

     SEC. 10704. ASSISTANT SECRETARY OF AGRICULTURE FOR CIVIL 
                   RIGHTS.

       (a) In General.--Section 218 of the Department of 
     Agriculture Reorganization Act of 1994 (7 U.S.C. 6918) is 
     amended--
       (1) in subsection (a)--
       (A) in paragraph (1), by striking ``and'' at the end;
       (B) in paragraph (2), by striking the period at the end and 
     inserting ``; and''; and
       (C) by adding at the end the following:
       ``(3) Assistant Secretary of Agriculture for Civil 
     Rights.''; and
       (2) by striking subsections (d) and (e) and inserting the 
     following:
       ``(d) Duties of Assistant Secretary of Agriculture for 
     Civil Rights.--The Secretary may delegate to the Assistant 
     Secretary for Civil Rights responsibility for--
       ``(1) ensuring compliance with all civil rights and related 
     laws by all agencies and under all programs of the 
     Department;
       ``(2) coordinating administration of civil rights laws 
     (including regulations) within the Department for employees 
     of, and participants in, programs of the Department; and
       ``(3) ensuring that necessary and appropriate civil rights 
     components are properly incorporated into all strategic 
     planning initiatives of the Department and agencies of the 
     Department.''.
       (b) Compensation.--Section 5315 of title 5, United States 
     Code, is amended by striking ``Assistant Secretaries of 
     Agriculture (2)'' and inserting ``Assistant Secretaries of 
     Agriculture (3)''.
       (c) Conforming Amendments.--Section 296(b) of the 
     Department of Agriculture Reorganization Act of 1994 (7 
     U.S.C. 7014(b)) is amended--
       (1) in paragraph (3), by striking ``or'' at the end;
       (2) in paragraph (4), by striking the period at the end and 
     inserting ``; or''; and
       (3) by adding at the end the following:
       ``(5) the authority of the Secretary to establish within 
     the Department the position of Assistant Secretary of 
     Agriculture for Civil Rights, and delegate duties to the 
     Assistant Secretary, under section 218.''.

     SEC. 10705. OPERATION OF GRADUATE SCHOOL OF DEPARTMENT OF 
                   AGRICULTURE.

       (a) Audits of Records.--Section 921 of the Federal 
     Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 
     2279b) is amended by adding at the end the following:
       ``(k) Audits of Records.--The financial records of the 
     Graduate School (including records relating to contracts or 
     agreements entered into under subsection (c)) shall be made 
     available to the Comptroller General for purposes of 
     conducting an audit.''.
       (b) Conforming Repeal.--Section 1669 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5922) is repealed.
       (c) Effective Date.--The amendments made by this section 
     take effect on October 1, 2002.

     SEC. 10706. IMPLEMENTATION FUNDING AND INFORMATION 
                   MANAGEMENT.

       (a) Additional Funds for Administrative Costs.--
       (1) In general.--The Secretary of Agriculture, acting 
     through the Farm Service Agency, may use not more than 
     $55,000,000 of funds of the Commodity Credit Corporation to 
     cover administrative costs associated with the implementation 
     of title I and the amendments made by that title.
       (2) Availability.--The funds referred to in paragraph (1) 
     shall remain available to the Secretary until expended.
       (3) Set-aside.--Of the amount specified in paragraph (1), 
     the Secretary shall use not less than $5,000,000, but not 
     more than $8,000,000, to carry out subsection (b).
       (b) Information Management.--
       (1) Development of system.--The Secretary of Agriculture 
     shall develop a comprehensive information management system, 
     using appropriate technologies, to be used in implementing 
     the programs administered by the Federal Crop Insurance 
     Corporation and the Farm Service Agency.
       (2) Elements.--The information management system developed 
     under this subsection shall be designed to--
       (A) improve access by agricultural producers to programs 
     described in paragraph (1);
       (B) improve and protect the integrity of the information 
     collected;
       (C) meet the needs of the agencies that require the data in 
     the administration of their programs;
       (D) improve the timeliness of the collection of the 
     information;
       (E) contribute to the elimination of duplication of 
     information collection;
       (F) lower the overall cost to the Department of Agriculture 
     for information collection; and
       (G) achieve such other goals as the Secretary considers 
     appropriate.
       (3) Reconciliation of current information management.--The 
     Secretary shall ensure that all current information of the 
     Federal Crop Insurance Corporation and the Farm Service 
     Agency is combined, reconciled, redefined, and reformatted in 
     such a manner so that the agencies can use the common 
     information management system developed under this 
     subsection.
       (4) Assistance for development of system.--The Secretary 
     shall enter into an agreement or contract with a non-Federal 
     entity to assist the Secretary in the development of the 
     information management system. The Secretary shall give 
     preference in entering into an agreement or contract to 
     entities that have--
       (A) prior experience with the information and management 
     systems of the Federal Crop Insurance Corporation; and
       (B) collaborated with the Corporation in the development of 
     the identification procedures required by section 515(f) of 
     the Federal Crop Insurance Act (7 U.S.C. 1515(f)).
       (5) Use.--The information collected using the information 
     management system developed under this subsection may be made 
     available to--
       (A) any Federal agency that requires the information to 
     carry out the functions of the agency; and
       (B) any approved insurance provider, as defined in section 
     502(b) of the Federal Crop Insurance Act (7 U.S.C. 1502(b)), 
     with respect to producers insured by the approved insurance 
     provider.
       (6) Relation to other activities.--This subsection shall 
     not interfere with, or delay, existing agreements or requests 
     for proposals of the Federal Crop Insurance Corporation or 
     the Farm Service Agency regarding the information management 
     activities known as data mining or data warehousing.
       (c) Authorization of Appropriations.--In addition to 
     amounts made available under subsection (a)(3), there are 
     authorized to be appropriated such sums as are necessary to 
     carry out subsection (b) for each of fiscal years 2003 
     through 2008.

     SEC. 10707. OUTREACH AND ASSISTANCE FOR SOCIALLY 
                   DISADVANTAGED FARMERS AND RANCHERS.

       (a) Definitions.--Section 2501(e) of the Food, Agriculture, 
     Conservation, and Trade Act of 1990 (7 U.S.C. 2279(e)) is 
     amended by adding at the end the following:
       ``(4) Department.--The term `Department' means the 
     Department of Agriculture.
       ``(5) Eligible entity.--The term `eligible entity' means 
     any of the following:
       ``(A) Any community-based organization, network, or 
     coalition of community-based organizations that--
       ``(i) has demonstrated experience in providing agricultural 
     education or other agriculturally related services to 
     socially disadvantaged farmers and ranchers;
       ``(ii) has provided to the Secretary documentary evidence 
     of work with socially disadvantaged farmers and ranchers 
     during the 2-year period preceding the submission of an 
     application for assistance under subsection (a); and
       ``(iii) does not engage in activities prohibited under 
     section 501(c)(3) of the Internal Revenue Code of 1986.
       ``(B) An 1890 institution or 1994 institution (as defined 
     in section 2 of the Agricultural Research, Extension, and 
     Education Reform Act of 1998 (7 U.S.C. 7601)), including West 
     Virginia State College.
       ``(C) An Indian tribal community college or an Alaska 
     Native cooperative college.
       ``(D) An Hispanic-serving institution (as defined in 
     section 1404 of the National Agricultural Research, 
     Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103)).
       ``(E) Any other institution of higher education (as defined 
     in section 101 of the Higher Education Act of 1965 (20 U.S.C. 
     1001)) that has demonstrated experience in providing 
     agriculture education or other agriculturally related 
     services to socially disadvantaged farmers and ranchers in a 
     region.
       ``(F) An Indian tribe (as defined in section 4 of the 
     Indian Self-Determination and Education Assistance Act (25 
     U.S.C. 450b)) or a national tribal organization that has 
     demonstrated experience in providing agriculture education or 
     other agriculturally related services to socially 
     disadvantaged farmers and ranchers in a region.
       ``(G) An organization or institution that received funding 
     under subsection (a) before January 1, 1996, but only with 
     respect to projects that the Secretary considers are similar 
     to projects previously carried out by the organization or 
     institution under such subsection.
       ``(6) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture.''.
       (b) Outreach and Assistance.--Section 2501 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     2279) is amended by striking subsection (a) and inserting the 
     following:
       ``(a) Outreach and Assistance.--
       ``(1) Program.--The Secretary of Agriculture shall carry 
     out an outreach and technical assistance program to encourage 
     and assist socially disadvantaged farmers and ranchers--
       ``(A) in owning and operating farms and ranches; and
       ``(B) in participating equitably in the full range of 
     agricultural programs offered by the Department.
       ``(2) Requirements.--The outreach and technical assistance 
     program under paragraph (1) shall--
       ``(A) enhance coordination of the outreach, technical 
     assistance, and education efforts authorized under various 
     agriculture programs; and
       ``(B) include information on, and assistance with--
       ``(i) commodity, conservation, credit, rural, and business 
     development programs;
       ``(ii) application and bidding procedures;
       ``(iii) farm and risk management;
       ``(iv) marketing; and
       ``(v) other activities essential to participation in 
     agricultural and other programs of the Department.
       ``(3) Grants and contracts.--
       ``(A) In general.--The Secretary may make grants to, and 
     enter into contracts and other agreements with, an eligible 
     entity to provide information and technical assistance under 
     this subsection.
       ``(B) Relationship to other law.--The authority to carry 
     out this section shall be in addition to any other authority 
     provided in this or any other Act.
       ``(C) Other projects.--Notwithstanding paragraph (1), the 
     Secretary may make grants

[[Page H1896]]

     to, and enter into contracts and other agreements with, an 
     organization or institution that received funding under this 
     section before January 1, 1996, to carry out a project that 
     is similar to a project for which the organization or 
     institution received such funding.
       ``(4) Funding.--
       ``(A) Authorization of appropriations.--There is authorized 
     to be appropriated to carry out this subsection $25,000,000 
     for each of fiscal years 2002 through 2007.
       ``(B) Interagency funding.--In addition to funds authorized 
     to be appropriated under subparagraph (A), any agency of the 
     Department may participate in any grant, contract, or 
     agreement entered into under this subsection by contributing 
     funds, if the agency determined that the objectives of the 
     grant, contract, or agreement will further the authorized 
     programs of the contributing agency.''.
       (c) Conforming Amendments.--Section 2501 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     2279) is amended--
       (1) in subsection (d)(1), by striking ``of Agriculture'' 
     after ``Department''; and
       (2) in subsection (g)(1), by striking ``of Agriculture'' 
     after ``Department''.

     SEC. 10708. TRANSPARENCY AND ACCOUNTABILITY FOR SOCIALLY 
                   DISADVANTAGED FARMERS AND RANCHERS; PUBLIC 
                   DISCLOSURE REQUIREMENTS FOR COUNTY COMMITTEE 
                   ELECTIONS.

       (a) Transparency and Accountability for Socially 
     Disadvantaged Farmers and Ranchers.--The Food, Agriculture, 
     Conservation, and Trade Act of 1990 is amended by inserting 
     after section 2501 (7 U.S.C. 2279) the following:

     ``SEC. 2501A. TRANSPARENCY AND ACCOUNTABILITY FOR SOCIALLY 
                   DISADVANTAGED FARMERS AND RANCHERS.

       ``(a) Purpose.--The purpose of this section is to ensure 
     compilation and public disclosure of data to assess and hold 
     the Department of Agriculture accountable for the 
     nondiscriminatory participation of socially disadvantaged 
     farmers and ranchers in programs of the Department.
       ``(b) Definition of Socially Disadvantaged Farmer or 
     Rancher.--In this section, the term `socially disadvantaged 
     farmer or rancher' has the meaning given the term in section 
     355(e) of the Consolidated Farm and Rural Development Act (7 
     U.S.C. 2003(e)).
       ``(c) Compilation of Program Participation Data.--
       ``(1) Annual requirement.--For each county and State in the 
     United States, the Secretary shall compute annually the 
     participation rate of socially disadvantaged farmers and 
     ranchers as a percentage of the total participation of all 
     farmers and ranchers for each program of the Department of 
     Agriculture established for farmers or ranchers.
       ``(2) Reporting participation.--In reporting the rates of 
     participation under paragraph (1), the Secretary shall report 
     the participation rate of socially disadvantaged farmers and 
     ranchers according to race, ethnicity, and gender.''.
       (b) Public Disclosure Requirements for County Committee 
     Elections.--Section 8(b)(5) of the Soil Conservation and 
     Domestic Allotment Act (16 U.S.C. 590h(b)(5)) is amended by 
     striking subparagraph (B) and inserting the following:
       ``(B) Establishment and elections for county, area, or 
     local committees.--
       ``(i) Establishment.--

       ``(I) In general.--In each county or area in which 
     activities are carried out under this section, the Secretary 
     shall establish a county or area committee.
       ``(II) Local administrative areas.--The Secretary may 
     designate local administrative areas within a county or a 
     larger area under the jurisdiction of a committee established 
     under subclause (I).

       ``(ii) Composition of county, area, or local committees.--A 
     committee established under clause (i) shall consist of not 
     fewer than 3 nor more than 5 members that--

       ``(I) are fairly representative of the agricultural 
     producers within the area covered by the county, area, or 
     local committee; and
       ``(II) are elected by the agricultural producers that 
     participate or cooperate in programs administered within the 
     area under the jurisdiction of the county, area, or local 
     committee.

       ``(iii) Elections.--

       ``(I) In general.--Subject to subclauses (II) through (V), 
     the Secretary shall establish procedures for nominations and 
     elections to county, area, or local committees.
       ``(II) Nondiscrimination statement.--Each solicitation of 
     nominations for, and notice of elections of, a county, area, 
     or local committee shall include the nondiscrimination 
     statement used by the Secretary.
       ``(III) Nominations.--

       ``(aa) Eligibility.--To be eligible for nomination and 
     election to the applicable county, area, or local committee, 
     as determined by the Secretary, an agricultural producer 
     shall be located within the area under the jurisdiction of a 
     county, area, or local committee, and participate or 
     cooperate in programs administered within that area.
       ``(bb) Outreach.--In addition to such nominating procedures 
     as the Secretary may prescribe, the Secretary shall solicit 
     and accept nominations from organizations representing the 
     interests of socially disadvantaged groups (as defined in 
     section 355(e)(1) of the Consolidated Farm and Rural 
     Development Act (7 U.S.C. 2003(e)(1)).

       ``(IV) Opening of ballots.--

       ``(aa) Public notice.--At least 10 days before the date on 
     which ballots are to be opened and counted, a county, area, 
     or local committee shall announce the date, time, and place 
     at which election ballots will be opened and counted.
       ``(bb) Opening of ballots.--Election ballots shall not be 
     opened until the date and time announced under item (aa).
       ``(cc) Observation.--Any person may observe the opening and 
     counting of the election ballots.

       ``(V) Report of election.--Not later than 20 days after the 
     date on which an election is held, a county, area, or local 
     committee shall file an election report with the Secretary 
     and the State office of the Farm Service Agency that 
     includes--

       ``(aa) the number of eligible voters in the area covered by 
     the county, area, or local committee;
       ``(bb) the number of ballots cast in the election by 
     eligible voters (including the percentage of eligible voters 
     that cast ballots);
       ``(cc) the number of ballots disqualified in the election;
       ``(dd) the percentage that the number of ballots 
     disqualified is of the number of ballots received;
       ``(ee) the number of nominees for each seat up for 
     election;
       ``(ff) the race, ethnicity, and gender of each nominee, as 
     provided through the voluntary self-identification of each 
     nominee; and
       ``(gg) the final election results (including the number of 
     ballots received by each nominee).

       ``(VI) National report.--Not later than 90 days after the 
     date on which the first election of a county, area, or local 
     committee that occurs after the date of enactment of the Farm 
     Security and Rural Investment Act of 2002 is held, the 
     Secretary shall complete a report that consolidates all the 
     election data reported to the Secretary under subclause (V).
       ``(VII) Election reform.--

       ``(aa) Analysis.--If determined necessary by the Secretary 
     after analyzing the data contained in the report under 
     subclause (VI), the Secretary shall promulgate and publish in 
     the Federal Register proposed uniform guidelines for 
     conducting elections for members and alternate members of 
     county, area, and local committees not later than 1 year 
     after the date of completion of the report.
       ``(bb) Inclusion.--The procedures promulgated by the 
     Secretary under item (aa) shall ensure fair representation of 
     socially disadvantaged groups described in subclause 
     (III)(bb) in an area covered by the county, area, or local 
     committee, in cases in which those groups are 
     underrepresented on the county, area, or local committee for 
     that area.
       ``(cc) Methods of inclusion.--Notwithstanding clause (ii), 
     the Secretary may ensure inclusion of socially disadvantaged 
     farmers and ranchers through provisions allowing for 
     appointment of 1 additional voting member to a county, area, 
     or local committee or through other methods.
       ``(iv) Term of office.--The term of office for a member of 
     a county, area, or local committee shall not exceed 3 years.
       ``(v) Public availability and report to congress.--

       ``(I) Public disclosure.--The Secretary shall maintain and 
     make readily available to the public, via website and 
     otherwise in electronic and paper form, all data required to 
     be collected and computed under section 2501A(c) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 and clause 
     (iii)(V) collected annually since the most recent Census of 
     Agriculture.
       ``(II) Report to congress.--After each Census of 
     Agriculture, the Secretary shall report to Congress the rate 
     of loss or gain in participation by each socially 
     disadvantaged group, by race, ethnicity, and gender, since 
     the previous Census.''.

                     Subtitle I--General Provisions

     SEC. 10801. COTTON CLASSIFICATION SERVICES.

       (a) Extension of Authority to Provide Services.--The first 
     sentence of section 3a of the Act of March 3, 1927 (commonly 
     known as the ``Cotton Statistics and Estimates Act''; 7 
     U.S.C. 473a), is amended by striking ``2002'' and inserting 
     ``2007''.
       (b) Repeal of Obsolete Effective Date Provisions.--
       (1) 1984 amendment.--The first section of Public Law 98-403 
     (98 Stat. 1479) is amended by striking ``, effective for the 
     period beginning October 1, 1984, and ending September 30, 
     1988,''.
       (2) 1987 amendments.--Section 2 of the Uniform Cotton 
     Classing Fees Act of 1987 (Public Law 100-108; 101 Stat. 728) 
     is amended by striking ``Effective for the period beginning 
     on the date of enactment of this Act and ending September 30, 
     1992, section'' and inserting ``Section''.
       (3) 1991 amendments.--Section 120 of the Food, Agriculture, 
     Conservation, and Trade Act Amendments of 1991 (Public Law 
     102-237; 105 Stat. 1842) is amended by striking subsection 
     (e).

     SEC. 10802. PROGRAM OF PUBLIC EDUCATION REGARDING USE OF 
                   BIOTECHNOLOGY IN PRODUCING FOOD FOR HUMAN 
                   CONSUMPTION.

       (a) Public Information Campaign.--Not later than 1 year 
     after the date of enactment of this Act, the Secretary of 
     Agriculture shall develop and implement a program to 
     communicate with the public regarding the use of 
     biotechnology in producing food for human consumption. The 
     information provided under the program shall include the 
     following:
       (1) Science-based evidence on the safety of foods produced 
     with biotechnology.
       (2) Scientific data on the human outcomes of the use of 
     biotechnology to produce food for human consumption.
       (b) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section for each of fiscal years 2002 through 2007.

     SEC. 10803. CHINO DAIRY PRESERVE PROJECT.

       Notwithstanding any other provision of law, the Secretary 
     of Agriculture, acting through the Natural Resources 
     Conservation Service, may provide financial and technical 
     assistance to the Chino Dairy Preserve Project, San Bernadino 
     County, California.

     SEC. 10804. GRAZINGLANDS RESEARCH LABORATORY.

       Notwithstanding any other provision of law, before December 
     31, 2007, the Federal land and

[[Page H1897]]

     facilities at El Reno, Oklahoma, currently administered by 
     the Secretary of Agriculture as the Grazinglands Research 
     Laboratory shall not, without specific authorization by 
     Congress--
       (1) be declared to be excess or surplus under the Federal 
     Property and Administrative Services Act of 1949 (40 U.S.C. 
     471 et seq.); or
       (2) be conveyed or otherwise transferred in whole or in 
     part.

     SEC. 10805. FOOD AND AGRICULTURAL POLICY RESEARCH INSTITUTE.

       (a) Authority.--The Secretary of Agriculture may award 
     grants to the Food and Agricultural Policy Research Institute 
     for the purpose of funding prospective, independent research 
     on the effects of alternative domestic, foreign, and trade 
     policies, on the agricultural sector, including research on 
     the effects of those policies on--
       (1) commodity prices for--
       (A) feed; and
       (B) food grains, oilseeds, cotton, livestock, and products 
     thereof;
       (2) supply and demand conditions for similar products;
       (3) costs to the Federal Government;
       (4) farm income;
       (5) food costs;
       (6) the volume and value of trade in agricultural 
     commodities; and
       (7) exporter and importer supply, demand, and trade.
       (b) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $6,000,000 for 
     each of fiscal years 2003 through 2007.

     SEC. 10806. MARKET NAMES FOR CATFISH AND GINSENG.

       (a) Catfish Labeling.--
       (1) In general.--Notwithstanding any other provision of 
     law, for purposes of the Federal Food, Drug, and Cosmetic Act 
     (21 U.S.C. 301 et seq.)--
       (A) the term ``catfish'' may only be considered to be a 
     common or usual name (or part thereof) for fish classified 
     within the family Ictaluridae; and
       (B) only labeling or advertising for fish classified within 
     that family may include the term ``catfish''.
       (2) Amendment.--Section 403 of the Federal Food, Drug, and 
     Cosmetic Act (21 U.S.C. 343) is amended by adding at the end 
     the following:
       ``(t) If it purports to be or is represented as catfish, 
     unless it is fish classified within the family 
     Ictaluridae.''.
       (b) Ginseng Labeling.--
       (1) In general.--Notwithstanding any other provision of 
     law, for purposes of the Federal Food, Drug, and Cosmetic Act 
     (21 U.S.C. 301 et seq.)--
       (A) the term ``ginseng'' may only be considered to be a 
     common or usual name (or part thereof) for any herb or herbal 
     ingredient derived from a plant classified within the genus 
     Panax; and
       (B) only labeling or advertising for herbs or herbal 
     ingredients classified within that genus may include the term 
     ``ginseng''.
       (2) Amendment.--Section 403 of the Federal Food, Drug, and 
     Cosmetic Act (21 U.S.C. 343) (as amended by subsection 
     (a)(2)) is amended by adding at the end the following:
       ``(u) If it purports to be or is represented as ginseng, 
     unless it is an herb or herbal ingredient derived from a 
     plant classified within the genus Panax.''.

     SEC. 10807. FOOD SAFETY COMMISSION.

       (a) Establishment.--
       (1) In general.--There is established a commission to be 
     known as the ``Food Safety Commission'' (referred to in this 
     section as the ``Commission'').
       (2) Membership.--
       (A) Composition.--The Commission shall be composed of 15 
     members (including a Chairperson, appointed by the President.
       (B) Eligibility.--
       (i) In general.--Members of the Commission--

       (I) shall have specialized training or significant 
     experience in matters under the jurisdiction of the 
     Commission; and
       (II) shall represent, at a minimum--

       (aa) consumers;
       (bb) food scientists;
       (cc) the food industry; and
       (dd) health professionals.
       (ii) Federal employees.--Not more than 3 members of the 
     Commission may be Federal employees.
       (C) Date of appointments.--The appointment of the members 
     of the Commission shall be made as soon as practicable after 
     the date on which funds authorized to be appropriated under 
     subsection (e)(1) are made available.
       (D) Vacancies.--A vacancy on the Commission--
       (i) shall not affect the powers of the Commission; and
       (ii) shall be filled--

       (I) not later than 60 days after the date on which the 
     vacancy occurs; and
       (II) in the same manner as the original appointment was 
     made.

       (3) Meetings.--
       (A) Initial meeting.--The initial meeting of the Commission 
     shall be conducted not later than 30 days after the date of 
     appointment of the final member of the Commission.
       (B) Other meetings.--The Commission shall meet at the call 
     of the Chairperson.
       (4) Quorum; standing rules.--
       (A) Quorum.--A majority of the members of the Commission 
     shall constitute a quorum to conduct business.
       (B) Standing rules.--At the first meeting of the 
     Commission, the Commission shall adopt standing rules of the 
     Commission to guide the conduct of business and 
     decisionmaking of the Commission.
       (b) Duties.--
       (1) Recommendations.--The Commission shall make specific 
     recommendations to enhance the food safety system of the 
     United States, including a description of how each 
     recommendation would improve food safety.
       (2) Components.--Recommendations made by the Commission 
     under paragraph (1) shall address all food available 
     commercially in the United States.
       (3) Report.--Not later than 1 year after the date on which 
     the Commission first meets, the Commission shall submit to 
     the President and Congress--
       (A) the findings, conclusions, and recommendations of the 
     Commission, including a description of how each 
     recommendation would improve food safety;
       (B) a summary of any other material used by the Commission 
     in the preparation of the report under this paragraph; and
       (C) if requested by 1 or more members of the Commission, a 
     statement of the minority views of the Commission.
       (c) Powers of the Commission.--
       (1) Hearings.--The Commission may, for the purpose of 
     carrying out this section, hold such hearings, meet and act 
     at such times and places, take such testimony, and receive 
     such evidence as the Commission considers advisable.
       (2) Information from federal agencies.--
       (A) In general.--The Commission may secure directly, from 
     any Federal agency, such information as the Commission 
     considers necessary to carry out this section.
       (B) Provision of information.--
       (i) In general.--Subject to subparagraph (C), on the 
     request of the Commission, the head of a Federal agency 
     described in subparagraph (A) may furnish information 
     requested by the Commission to the Commission.
       (ii) Administration.--The furnishing of information by a 
     Federal agency to the Commission shall not be considered a 
     waiver of any exemption available to the agency under section 
     552 of title 5, United States Code.
       (C) Information to be kept confidential.--
       (i) In general.--For purposes of section 1905 of title 18, 
     United States Code--

       (I) the Commission shall be considered an agency of the 
     Federal Government; and
       (II) any individual employed by an individual, entity, or 
     organization that is a party to a contract with the 
     Commission under this section shall be considered an employee 
     of the Commission.

       (ii) Prohibition on disclosure.--Information obtained by 
     the Commission, other than information that is available to 
     the public, shall not be disclosed to any person in any 
     manner except to an employee of the Commission as described 
     in clause (i), for the purpose of receiving, reviewing, or 
     processing the information.
       (d) Commission Personnel Matters.--
       (1) Members.--
       (A) Compensation.--A member of the Commission shall serve 
     without compensation for the services of the member on the 
     Commission.
       (B) Travel expenses.--A member of the Commission shall be 
     allowed travel expenses, including per diem in lieu of 
     subsistence, at rates authorized for an employee of an agency 
     under subchapter I of chapter 57 of title 5, United States 
     Code, while away from the home or regular place of business 
     of the member in the performance of the duties of the 
     Commission.
       (2) Staff.--
       (A) In general.--The Chairperson of the Commission may, 
     without regard to the civil service laws (including 
     regulations), appoint and terminate the appointment of an 
     executive director and such other additional personnel as are 
     necessary to enable the Commission to perform the duties of 
     the Commission.
       (B) Confirmation of executive director.--The employment of 
     an executive director shall be subject to confirmation by the 
     Commission.
       (C) Compensation.--
       (i) In general.--Except as provided in clause (ii), the 
     Chairperson of the Commission may fix the compensation of the 
     executive director and other personnel without regard to the 
     provisions of chapter 51 and subchapter III of chapter 53 of 
     title 5, United States Code, relating to classification of 
     positions and General Schedule pay rates.
       (ii) Maximum rate of pay.--The rate of pay for the 
     executive director and other personnel shall not exceed the 
     rate payable for level II of the Executive Schedule under 
     section 5316 of title 5, United States Code.
       (3) Detail of federal government employees.--
       (A) In general.--An employee of the Federal Government may 
     be detailed to the Commission, without reimbursement, for 
     such period of time as is permitted by law.
       (B) Civil service status.--The detail of the employee shall 
     be without interruption or loss of civil service status or 
     privilege.
       (4) Procurement of temporary and intermittent services.--
     The Chairperson of the Commission may procure temporary and 
     intermittent services in accordance with section 3109(b) of 
     title 5, United States Code, at rates for individuals that do 
     not exceed the daily equivalent of the annual rate of basic 
     pay prescribed for level II of the Executive Schedule under 
     section 5316 of that title.
       (e) Authorization of Appropriations.--
       (1) In general.--There is authorized to be appropriated 
     such sums as are necessary to carry out this section.
       (2) Limitation.--No payment may be made under subsection 
     (d) except to the extent provided for in advance in an 
     appropriations Act.
       (f) Termination.--The Commission shall terminate on the 
     date that is 60 days after the date on which the Commission 
     submits the recommendations and report under subsection 
     (b)(3).

     SEC. 10808. PASTEURIZATION.

       (a) Pasteurization of Meat and Poultry.--

[[Page H1898]]

       (1) In general.--Effective beginning not later than 30 days 
     after the date of enactment of this Act, the Secretary of 
     Agriculture shall conduct an education program regarding the 
     availability and safety of processes and treatments that 
     eliminate or substantially reduce the level of pathogens on 
     meat, meat food products, poultry, and poultry products.
       (2) Authorization of appropriations.--There is authorized 
     to be appropriated such sums as are necessary to carry out 
     this subsection.
       (b) Pasteurization of Food As Pasteurized.--Section 403(h) 
     of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
     343(h)) is amended--
       (1) by striking ``or'' at the end of paragraph (1);
       (2) by striking the period at the end of paragraph (2) and 
     inserting ``; or''; and
       (3) by adding at the end the following:
       ``(3) a food that is pasteurized unless--
       ``(A) such food has been subjected to a safe process or 
     treatment that is prescribed as pasteurization for such food 
     in a regulation promulgated under this Act; or
       ``(B)(i) such food has been subjected to a safe process or 
     treatment that--
       ``(I) is reasonably certain to achieve destruction or 
     elimination in the food of the most resistant microorganisms 
     of public health significance that are likely to occur in the 
     food;
       ``(II) is at least as protective of the public health as a 
     process or treatment described in subparagraph (A);
       ``(III) is effective for a period that is at least as long 
     as the shelf life of the food when stored under normal and 
     moderate abuse conditions; and
       ``(IV) is the subject of a notification to the Secretary, 
     including effectiveness data regarding the process or 
     treatment; and
       ``(ii) at least 120 days have passed after the date of 
     receipt of such notification by the Secretary without the 
     Secretary making a determination that the process or 
     treatment involved has not been shown to meet the 
     requirements of subclauses (I) through (III) of clause (i).

     For purposes of paragraph (3), a determination by the 
     Secretary that a process or treatment has not been shown to 
     meet the requirements of subclauses (I) through (III) of 
     subparagraph (B)(i) shall constitute final agency action 
     under such subclauses.''.

     SEC. 10809. RULEMAKING ON LABELING OF IRRADIATED FOOD; 
                   CERTAIN PETITIONS.

       The Secretary of Health and Human Services (referred to in 
     this section as the ``Secretary'') shall publish a proposed 
     rule and, with due consideration to public comment, a final 
     rule to revise, as appropriate, the current regulation 
     governing the labeling of foods that have been treated to 
     reduce pest infestation or pathogens by treatment by 
     irradiation using radioactive isotope, electronic beam, or x-
     ray. Pending promulgation of the final rule required by this 
     subsection, any person may petition the Secretary for 
     approval of labeling, which is not false or misleading in any 
     material respect, of a food which has been treated by 
     irradiation using radioactive isotope, electronic beam, or x-
     ray. The Secretary shall approve or deny such a petition 
     within 180 days of receipt of the petition, or the petition 
     shall be deemed denied, except to the extent additional 
     agency review is mutually agreed upon by the Secretary and 
     the petitioner. Any denial of a petition under this 
     subsection shall constitute final agency action subject to 
     judicial review by the United States Court of Appeals for the 
     District of Columbia Circuit. Any labeling approved through 
     the foregoing petition process shall be subject to the 
     provisions of the final rule referred to in the first 
     sentence of the subparagraph on the effective date of such 
     final rule.

     SEC. 10810. PENALTIES FOR VIOLATIONS OF PLANT PROTECTION ACT.

       Section 424 of the Plant Protection Act (7 U.S.C. 7734) is 
     amended by striking subsection (a) and inserting the 
     following:
       ``(a) Criminal Penalties.--
       ``(1) Offenses.--
       ``(A) In general.--A person that knowingly violates this 
     title, or knowingly forges, counterfeits, or, without 
     authority from the Secretary, uses, alters, defaces, or 
     destroys any certificate, permit, or other document provided 
     for in this title shall be fined under title 18, United 
     States Code, imprisoned not more than 1 year, or both.
       ``(B) Movement.--A person that knowingly imports, enters, 
     exports, or moves any plant, plant product, biological 
     control organism, plant pest, noxious weed, or article, for 
     distribution or sale, in violation of this title, shall be 
     fined under title 18, United States Code, imprisoned not more 
     than 5 years, or both.
       ``(2) Multiple violations.--On the second and any 
     subsequent conviction of a person of a violation of this 
     title under paragraph (1), the person shall be fined under 
     title 18, United States Code, imprisoned not more than 10 
     years, or both.''.

     SEC. 10811. PRECLEARANCE QUARANTINE INSPECTIONS.

       (a) Preclearance Inspections Required.--The Secretary of 
     Agriculture, acting through the Administrator of the Animal 
     and Plant Health Inspection Service, shall conduct 
     preclearance quarantine inspections of persons, baggage, 
     cargo, and any other articles destined for movement from the 
     State of Hawaii to any of the following--
       (1) The continental United States.
       (2) Guam.
       (3) Puerto Rico.
       (4) The United States Virgin Islands.
       (b) Inspection Locations.--The preclearance quarantine 
     inspections required by subsection (a) shall be conducted at 
     all direct departure and interline airports in the State of 
     Hawaii.
       (c) Limitation.--The Secretary shall not implement this 
     section unless appropriations for necessary expenses of the 
     Animal and Plant Health Inspection Service for inspection, 
     quarantine, and regulatory activities are increased by an 
     amount not less than $3,000,000 in an Act making 
     appropriations for fiscal year 2003.

     SEC. 10812. CONNECTICUT RIVER ATLANTIC SALMON COMMISSION.

       Section 3(2) of Public Law 98-138 (Public Law 98-138; 97 
     Stat. 870) is amended by striking ``twenty'' and inserting 
     ``40''.

     SEC. 10813. PINE POINT SCHOOL.

       Section 802(b)(2) of the No Child Left Behind Act of 2001 
     (Public Law 107-110) is amended by striking ``2002'' each 
     place it appears and inserting ``2000''.

     SEC. 10814. 7-MONTH EXTENSION OF CHAPTER 12 OF TITLE 11 OF 
                   THE UNITED STATES CODE.

       (a) Amendments.--Section 149 of title I of division C of 
     Public Law 105-277 is amended--
       (1) by striking ``June 1, 2002'' each place it appears and 
     inserting ``January 1, 2003''; and
       (2) in subsection (a)--
       (A) by striking ``September 30, 2001'' and inserting ``May 
     31, 2002''; and
       (B) by striking ``October 1, 2001'' and inserting ``June 1, 
     2002''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall take effect on June 1, 2002.

     SEC. 10815. PRACTICES INVOLVING NONAMBULATORY LIVESTOCK.

       (a) Report.--The Secretary of Agriculture shall investigate 
     and submit to Congress a report on--
       (1) the scope of nonambulatory livestock;
       (2) the causes that render livestock nonambulatory;
       (3) the humane treatment of nonambulatory livestock; and
       (4) the extent to which nonambulatory livestock may present 
     handling and disposition problems for stockyards, market 
     agencies, and dealers.
       (b) Authority.--Based on the findings of the report, if the 
     Secretary determines it necessary, the Secretary shall 
     promulgate regulations to provide for the humane treatment, 
     handling, and disposition of nonambulatory livestock by 
     stockyards, market agencies, and dealers.
       (c) Administration and Enforcement.--For the purpose of 
     administering and enforcing any regulations promulgated under 
     subsection (b), the authorities provided under sections 10414 
     and 10415 shall apply to the regulations in a similar manner 
     as those sections apply to the Animal Health Protection Act. 
     Any person that violates regulations promulgated under 
     subsection (b) shall be subject to penalties provided in 
     section 10414.

     SEC. 10816. COUNTRY OF ORIGIN LABELING.

       The Agricultural Marketing Act of 1946 (7 U.S.C. 1621 et 
     seq.) is amended by adding at the end the following:
                ``Subtitle D--Country of Origin Labeling

     ``SEC. 281. DEFINITIONS.

       ``In this subtitle:
       ``(1) Beef.--The term `beef' means meat produced from 
     cattle (including veal).
       ``(2) Covered commodity.--
       ``(A) In general.--The term `covered commodity' means--
       ``(i) muscle cuts of beef, lamb, and pork;
       ``(ii) ground beef, ground lamb, and ground pork;
       ``(iii) farm-raised fish;
       ``(iv) wild fish;
       ``(v) a perishable agricultural commodity; and
       ``(vi) peanuts.
       ``(B) Exclusions.--The term `covered commodity' does not 
     include an item described in subparagraph (A) if the item is 
     an ingredient in a processed food item.
       ``(3) Farm-raised fish.--The term `farm-raised fish' 
     includes--
       ``(A) farm-raised shellfish; and
       ``(B) fillets, steaks, nuggets, and any other flesh from a 
     farm-raised fish or shellfish.
       ``(4) Food service establishment.--The term `food service 
     establishment' means a restaurant, cafeteria, lunch room, 
     food stand, saloon, tavern, bar, lounge, or other similar 
     facility operated as an enterprise engaged in the business of 
     selling food to the public.
       ``(5) Lamb.--The term `lamb' means meat, other than mutton, 
     produced from sheep.
       ``(6) Perishable agricultural commodity; retailer.--The 
     terms `perishable agricultural commodity' and `retailer' have 
     the meanings given the terms in section 1(b) of the 
     Perishable Agricultural Commodities Act of 1930 (7 U.S.C. 
     499a(b)).
       ``(7) Pork.--The term `pork' means meat produced from hogs.
       ``(8) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture, acting through the Agricultural Marketing 
     Service.
       ``(9) Wild fish.--
       ``(A) In general.--The term `wild fish' means naturally-
     born or hatchery-raised fish and shellfish harvested in the 
     wild.
       ``(B) Inclusions.--The term `wild fish' includes a fillet, 
     steak, nugget, and any other flesh from wild fish or 
     shellfish.
       ``(C) Exclusions.--The term `wild fish' excludes net-pen 
     aquacultural or other farm-raised fish.

     ``SEC. 282. NOTICE OF COUNTRY OF ORIGIN.

       ``(a) In General.--
       ``(1) Requirement.--Except as provided in subsection (b), a 
     retailer of a covered commodity shall inform consumers, at 
     the final point of sale of the covered commodity to 
     consumers, of the country of origin of the covered commodity.
       ``(2) United states country of origin.--A retailer of a 
     covered commodity may designate the covered commodity as 
     having a United

[[Page H1899]]

     States country of origin only if the covered commodity--
       ``(A) in the case of beef, is exclusively from an animal 
     that is exclusively born, raised, and slaughtered in the 
     United States (including from an animal exclusively born and 
     raised in Alaska or Hawaii and transported for a period not 
     to exceed 60 days through Canada to the United States and 
     slaughtered in the United States);
       ``(B) in the case of lamb and pork, is exclusively from an 
     animal that is exclusively born, raised, and slaughtered in 
     the United States;
       ``(C) in the case of farm-raised fish, is hatched, raised, 
     harvested, and processed in the United States;
       ``(D) in the case of wild fish, is--
       ``(i) harvested in waters of the United States, a territory 
     of the United States, or a State; and
       ``(ii) processed in the United States, a territory of the 
     United States, or a State, including the waters thereof; and
       ``(E) in the case of a perishable agricultural commodity or 
     peanuts, is exclusively produced in the United States.
       ``(3) Wild fish and farm-raised fish.--The notice of 
     country of origin for wild fish and farm-raised fish shall 
     distinguish between wild fish and farm-raised fish.
       ``(b) Exemption for Food Service Establishments.--
     Subsection (a) shall not apply to a covered commodity if the 
     covered commodity is--
       ``(1) prepared or served in a food service establishment; 
     and
       ``(2)(A) offered for sale or sold at the food service 
     establishment in normal retail quantities; or
       ``(B) served to consumers at the food service 
     establishment.
       ``(c) Method of Notification.--
       ``(1) In general.--The information required by subsection 
     (a) may be provided to consumers by means of a label, stamp, 
     mark, placard, or other clear and visible sign on the covered 
     commodity or on the package, display, holding unit, or bin 
     containing the commodity at the final point of sale to 
     consumers.
       ``(2) Labeled commodities.--If the covered commodity is 
     already individually labeled for retail sale regarding 
     country of origin, the retailer shall not be required to 
     provide any additional information to comply with this 
     section.
       ``(d) Audit Verification System.--The Secretary may require 
     that any person that prepares, stores, handles, or 
     distributes a covered commodity for retail sale maintain a 
     verifiable recordkeeping audit trail that will permit the 
     Secretary to verify compliance with this subtitle (including 
     the regulations promulgated under section 284(b)).
       ``(e) Information.--Any person engaged in the business of 
     supplying a covered commodity to a retailer shall provide 
     information to the retailer indicating the country of origin 
     of the covered commodity.
       ``(f) Certification of Origin.--
       ``(1) Mandatory identification.--The Secretary shall not 
     use a mandatory identification system to verify the country 
     of origin of a covered commodity.
       ``(2) Existing certification programs.--To certify the 
     country of origin of a covered commodity, the Secretary may 
     use as a model certification programs in existence on the 
     date of enactment of this Act, including--
       ``(A) the carcass grading and certification system carried 
     out under this Act;
       ``(B) the voluntary country of origin beef labeling system 
     carried out under this Act;
       ``(C) voluntary programs established to certify certain 
     premium beef cuts;
       ``(D) the origin verification system established to carry 
     out the child and adult care food program established under 
     section 17 of the Richard B. Russell National School Lunch 
     Act (42 U.S.C. 1766); or
       ``(E) the origin verification system established to carry 
     out the market access program under section 203 of the 
     Agricultural Trade Act of 1978 (7 U.S.C. 5623).

     ``SEC. 283. ENFORCEMENT.

       ``(a) In General.--Except as provided in subsections (b) 
     and (c), section 253 shall apply to a violation of this 
     subtitle.
       ``(b) Warnings.--If the Secretary determines that a 
     retailer is in violation of section 282, the Secretary 
     shall--
       ``(1) notify the retailer of the determination of the 
     Secretary; and
       ``(2) provide the retailer a 30-day period, beginning on 
     the date on which the retailer receives the notice under 
     paragraph (1) from the Secretary, during which the retailer 
     may take necessary steps to comply with section 282.
       ``(c) Fines.--If, on completion of the 30-day period 
     described in subsection (b)(2), the Secretary determines that 
     the retailer has willfully violated section 282, after 
     providing notice and an opportunity for a hearing before the 
     Secretary with respect to the violation, the Secretary may 
     fine the retailer in an amount of not more than $10,000 for 
     each violation.

     ``SEC. 284. REGULATIONS.

       ``(a) Guidelines.--Not later than September 30, 2002, the 
     Secretary shall issue guidelines for the voluntary country of 
     origin labeling of covered commodities based on the 
     requirements of section 282.
       ``(b) Regulations.--Not later than September 30, 2004, the 
     Secretary shall promulgate such regulations as are necessary 
     to implement this subtitle.
       ``(c) Partnerships With States.--In promulgating the 
     regulations, the Secretary shall, to the maximum extent 
     practicable, enter into partnerships with States with 
     enforcement infrastructure to assist in the administration of 
     this subtitle.

     ``SEC. 285. APPLICABILITY.

       ``This subtitle shall apply to the retail sale of a covered 
     commodity beginning September 30, 2004.''.
             Subtitle J--Miscellaneous Studies and Reports

     SEC. 10901. REPORT ON SPECIALTY CROP PURCHASES.

       Not later than 1 year after the date of enactment of this 
     Act, the Secretary of Agriculture shall submit to the 
     Committee on Agriculture of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate a report on the quantity and type of--
       (1) fruits, vegetables, and other specialty food crops that 
     are purchased under section 10603; and
       (2) other commodities that are purchased under section 32 
     of the Act of August 24, 1935 (7 U.S.C. 612c).

     SEC. 10902. REPORT ON POUCHED AND CANNED SALMON.

       (a) In General.--Not later than 180 days after the date of 
     enactment of this Act, the Secretary of Agriculture shall 
     submit to Congress a report on efforts to expand the 
     promotion, marketing, and purchasing of pouched and canned 
     salmon harvested and processed in the United States under 
     food and nutrition programs administered by the Secretary.
       (b) Components.--The report under subsection (a) shall 
     include--
       (1) an analysis of pouched and canned salmon inventories in 
     the United States that, as of the date on which the report is 
     submitted, are available for purchase;
       (2) an analysis of the demand for pouched and canned salmon 
     and value-added products (such as salmon ``nuggets'') by--
       (A) partners of the Department of Agriculture (including 
     other appropriate Federal agencies); and
       (B) consumers; and
       (3) an analysis of impediments to additional purchases of 
     pouched and canned salmon, including--
       (A) any marketing issues; and
       (B) recommendations for methods to resolve those 
     impediments.

     SEC. 10903. STUDY ON UPDATING YIELDS.

       (a) In General.--The Comptroller General shall conduct a 
     study and make findings and recommendations with respect to 
     determining how producer income would be affected by updating 
     yield bases, including--
       (1) whether crop yields have increased over the past 20 
     crop years for program crops and oilseeds;
       (2) whether program payments would be disbursed differently 
     under title I if yield bases were updated further;
       (3) what impact the target prices under title I would have 
     on producer income if the yield bases of the target prices 
     were further updated; and
       (4) what impact lower target prices with updated yield 
     bases would have on producer income, as compared with the 
     impact of target prices under title I.
       (b) Report.--Not later than 180 days after the date of 
     enactment of this Act, the Comptroller General shall submit 
     to Congress a report on the study, findings, and 
     recommendations required by subsection (a).

     SEC. 10904. REPORT ON EFFECT OF FARM PROGRAM PAYMENTS.

       (a) In General.--The Secretary of Agriculture shall conduct 
     a review of the effects that payments under production 
     flexibility contracts and market loss assistance payments 
     have had, and that direct payments and counter-cyclical 
     payments are likely to have, on the economic viability of 
     producers and the farming infrastructure, particularly in 
     areas where climate, soil types, and other agronomic 
     conditions severely limit the covered crops that producers 
     can choose to successfully and profitably produce.
       (b) Case Study Related to Rice Production.--The review 
     shall include a case study of the effects that the payments 
     described in subsection (a), and the forecast effects of 
     increasing these or other fixed payments, are likely to have 
     on rice producers (including tenant rice producers), the rice 
     milling industry, and the economies of rice farming areas in 
     Texas, where harvested rice acreage has fallen from 320,000 
     acres in 1995 to only 211,000 acres in 2001.
       (c) Report and Recommendations.--
       (1) Report.--Not later than 90 days after the date of the 
     enactment of this Act, the Secretary shall submit to the 
     Committee on Agriculture of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate a report describing the information collected for the 
     review and the case study and any findings made on the basis 
     of the information.
       (2) Recommendations.--The report shall include 
     recommendations for minimizing the adverse effects on 
     producers, with a special focus on--
       (A) producers who are tenants;
       (B) the agricultural economies in farming areas generally;
       (C) particular areas described in subsection (a); and
       (D) on the area that is the subject of the case study 
     conducted under subsection (b).

     SEC. 10905. CHILOQUIN DAM FISH PASSAGE FEASIBILITY STUDY.

       (a) In General.--The Secretary of the Interior, in 
     collaboration with all interested parties (including the 
     Modoc Point Irrigation District, the Klamath Tribes, and the 
     Oregon Department of Fish and Wildlife), shall conduct a 
     study of the feasibility of providing adequate upstream and 
     downstream passage for fish at the Chiloquin Dam on the 
     Sprague River, Oregon.
       (b) Subjects.--The study shall include--
       (1) a review of all alternatives for providing passage 
     described in subsection (a), including the removal of the 
     dam;
       (2) the determination of the most appropriate alternative;
       (3) the development of recommendations for implementing 
     that alternative; and

[[Page H1900]]

       (4) examination of mitigation needed for upstream and 
     downstream water users, and for Klamath tribal nonconsumptive 
     uses, as a result of the implementation of the alternative.
       (c) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary of the Interior shall 
     submit to Congress a report that describes the findings, 
     conclusions, and recommendations of the study.

     SEC. 10906. REPORT ON GEOGRAPHICALLY DISADVANTAGED FARMERS 
                   AND RANCHERS.

       (a) Definition of Geographically Disadvantaged Farmer or 
     Rancher.--In this section, the term ``geographically 
     disadvantaged farmer or rancher' means a farmer or rancher 
     in--
       (1) an insular area (as defined in section 1404 of the 
     National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 (7 U.S.C. 3103) (as amended by section 
     7502(a)); or
       (2) a State other than 1 of the 48 contiguous States.
       (b) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary of Agriculture shall 
     submit to the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate a report that describes--
       (1) barriers to efficient and competitive transportation of 
     inputs and products by geographically disadvantaged farmers 
     and ranchers; and
       (2) means of encouraging and assisting geographically 
     disadvantaged farmers and ranchers--
       (A) to own and operate farms and ranches; and
       (B) to participate equitably in the full range of 
     agricultural programs offered by the Department of 
     Agriculture.

     SEC. 10907. STUDIES ON AGRICULTURAL RESEARCH AND TECHNOLOGY.

       (a) Scientific Studies.--
       (1) In general.--The Secretary of Agriculture may conduct 
     scientific studies on--
       (A) the transmission of spongiform encephalopathy in deer, 
     elk, and moose; and
       (B) chronic wasting disease (including the risks that 
     chronic wasting disease poses to livestock).
       (2) Report.--The Secretary shall submit to the Committee on 
     Agriculture of the House of Representatives and the Committee 
     on Agriculture, Nutrition, and Forestry of the Senate a 
     report on the results of any scientific studies conducted 
     under paragraph (1).
       (b) Vaccines.--
       (1) Vaccine storage study.--The Secretary may--
       (A) conduct a study to determine the number of doses of 
     livestock disease vaccines that should be available to 
     protect against livestock diseases that could be introduced 
     into the United States; and
       (B) compare that number with the number of doses of the 
     livestock disease vaccines that are available as of that 
     date.
       (2) Stockpiling of vaccines.--If, after conducting the 
     study and comparison described in paragraph (1), the 
     Secretary determines that there is an insufficient number of 
     doses of a particular vaccine referred to in that paragraph, 
     the Secretary may take such actions as are necessary to 
     obtain the required additional doses of the vaccine.

     SEC. 10908. REPORT ON TOBACCO SETTLEMENT AGREEMENT.

       Not later than December 31, 2002, and annually thereafter 
     through 2006, the Comptroller General shall submit to 
     Congress a report that describes all programs and activities 
     that States have carried out using funds received under all 
     phases of the Master Settlement Agreement of 1997.

     SEC. 10909. REPORT ON SALE AND USE OF PESTICIDES FOR 
                   AGRICULTURAL USES.

       Not later than 180 days after the date of enactment of this 
     Act, the Administrator of the Environmental Protection Agency 
     shall submit to the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate a report on the manner in which 
     the Agency is applying regulations of the Agency governing 
     the sale and use of pesticides for agricultural use to 
     electronic commerce transactions.

     SEC. 10910. REVIEW OF OPERATION OF AGRICULTURAL AND NATURAL 
                   RESOURCE PROGRAMS ON TRIBAL TRUST LAND.

       (a) Review.--The Secretary of Agriculture (referred to in 
     this section as the ``Secretary'') shall conduct a review of 
     the operation of agricultural and natural resource programs 
     available to farmers and ranchers operating on tribal and 
     trust land, including--
       (1) agricultural commodity, price support, and farm income 
     support programs (collectively referred to in this section as 
     ``agricultural commodity programs'');
       (2) conservation programs (including financial and 
     technical assistance);
       (3) agricultural credit programs;
       (4) rural development programs; and
       (5) forestry programs.
       (b) Criteria for Review.--In carrying out the review under 
     subsection (a), the Secretary shall consider--
       (1) the extent to which agricultural commodity programs and 
     conservation programs are consistent with tribal goals and 
     priorities regarding the sustainable use of agricultural 
     land;
       (2) strategies for increasing tribal participation in 
     agricultural commodity programs and conservation programs;
       (3) the educational and training opportunities available to 
     Indian tribes and members of Indian tribes in the practical, 
     technical, and professional aspects of agriculture and land 
     management; and
       (4) the development and management of agricultural land 
     under the jurisdiction of Indian tribes in accordance with 
     integrated resource management plans that--
       (A) ensure proper management of the land;
       (B) produce increased economic returns;
       (C) promote employment opportunities; and
       (D) improve the social and economic well-being of Indian 
     tribes and members of Indian tribes.
       (c) Consultation.--In carrying out this section, the 
     Secretary shall consult with--
       (1) the Secretary of the Interior;
       (2) local officers and employees of the Department of 
     Agriculture; and
       (3) program recipients.
       (d) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Secretary shall submit to Congress 
     a report that contains--
       (1) a description of the results of the review conducted 
     under this section;
       (2) recommendations for program improvements; and
       (3) a description of actions that will be taken to carry 
     out the improvements.
       And the Senate agree to the same.
       That the House recede from its disagreement to the 
     amendment of the Senate to the title of the bill and agree to 
     the same with an amendment as follows:
       In lieu of the matter proposed to be inserted by the 
     amendment of the Senate to the title of the bill, insert the 
     following: ``An Act to provide for the continuation of 
     agricultural programs through fiscal year 2007, and for other 
     purposes.''.
       And the Senate agree to the same.

     From the Committee on Agriculture, for consideration of the 
     House bill and Senate amendment and modifications committed 
     to conference:
     Larry Combest,
     Bob Goodlatte,
     Richard Pombo,
     Terry Everett,
     Frank D. Lucas,
     Saxby Chambliss,
     Jerry Moran,
     Charles W. Stenholm,
     Gary Condit,
     Collin C. Peterson,
     Eva M. Clayton,
     Tim Holden,
     As additional conferees from the Committee on the Budget, for 
     consideration of sec. 197 of the Senate amendment, and 
     modifications committed to conference:
     Jim Nussle,
     From the Committee on Education and the Workforce, for 
     consideration of secs. 453-5, 457-9, 460-1, and 464 of the 
     Senate amendment and modifications committed to conference:
     Michael N. Castle,
     Tom Osborne,
     Dale E. Kildee,
     From the Committee on Energy and Commerce, for consideration 
     of secs. 213, 605, 627, 648, 652, 902, 1041, and 1079E of the 
     Senate amendment, and modifications committed to conference:
     Billy Tauzin,
     Joe Barton,
     John D. Dingell,
     From the Committee on Financial Services, for consideration 
     of secs. 335 and 601 of the Senate amendment, and 
     modifications committed to conference:
     Michael G. Oxley,
     Spencer Bachus,
     John J. LaFalce
       (except for sec. 335),
     From the Committee on International Relations, for 
     consideration of title III of the House bill and title III of 
     the Senate amendment, and modifications committed to 
     conference:
     Henry Hyde,
     Christopher Smith,
     Tom Lantos,
     From the Committee on the Judiciary, for consideration of 
     secs. 940-1 of the House bill and secs. 602, 1028-9, 1033-5, 
     1046, 1049, 1052-3, 1058, 1068-9, 1070-1, 1098, and 1098A of 
     the Senate amendment, and modifications committed to 
     conference:
     Mark Green,
     From the Committee on Resources, for consideration of secs. 
     201, 203, 211, 213, 215-7, 262, 721, 786, 806, 810, 817-8, 
     1069, 1070, and 1076 of the Senate amendment, and 
     modifications committed to conference:
     James V. Hansen,
     Don Young,
     From the Committee on Science, for consideration of secs. 
     808, 811, 902-3, and 1079 of the Senate amendment, and 
     modifications committed to conference:
     Sherwood Boehlert,
     Roscoe G. Bartlett,
     Ralph M. Hall,
     From the Committee on Ways and Means, for consideration of 
     secs. 127 and 146 of the House bill and sections 144, 1024, 
     1038, and 1070 of the Senate amendment, and modifications 
     committed to conference:
     Charles B. Rangel,
                                Managers on the Part of the House.

     Tom Harkin,
     Patrick Leahy,
     Kent Conrad,
     Tom Daschle,
     Thad Cochran,
                               Managers on the Part of the Senate.

       JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE

       The Managers on the part of the House and the Senate at the 
     conference on the disagreeing votes of the two Houses on the 
     amendment of the Senate to the bill (H.R. 2646) to provide 
     for the continuation of agricultural programs through fiscal 
     year 2011, submit the following joint statement to the

[[Page H1901]]

     House and the Senate in explanation of the effect of the 
     action agreed upon by the managers and recommended in the 
     accompanying conference report:
       The Senate amendment struck out all of the House bill after 
     the enacting clause and inserted a substitute text.
       The House recedes from its disagreement to the amendment of 
     the Senate with an amendment which is a substitute for the 
     House bill and the Senate amendment. The differences between 
     the House bill, the Senate amendment, and the substitute 
     agreed to in conference are noted below, except for clerical 
     corrections, conforming changes made necessary by agreements 
     reached by the conferees, and minor drafting and clarifying 
     changes.

                     Short Title; Table of Contents

     (1) Short Title
       The House bill cites that this Act may be cited as the 
     ``Farm Security Act of 2001''. (Section 1)
       The Senate amendment cites that the Act may be cited as the 
     ``Agriculture, Conservation, and Rural Enhancement Act of 
     2002''. (Section 1)
       The Conference substitute cites this Act as the ``Farm 
     Security and Rural Investment Act of 2002''. (Section 1000)

                      Title I--Commodity Programs

     (2) Definitions
       The House bill defines terms necessary for implementation 
     of this Act: Agricultural Act of 1949, base acres, counter-
     cyclical payment, covered commodity, effective price, 
     eligible producer, fixed decoupled payment, other oilseed, 
     payment acres, payment yield, producer, Secretary, State, 
     target price and United States. (Section 101)
       The Senate amendment defines terms necessary for 
     implementation of this Act: Agricultural Act of 1949, 
     considered planted, contract, contract acreage, contract 
     commodity, contract payment, Department, ELS Cotton, loan 
     commodity, oilseed, payment yield, producer, Secretary, State 
     and United States. (Section 101)
       The Conference substitute defines terms necessary for 
     implementation of this Act: Agricultural Act of 1949, base 
     acres, counter-cyclical payment, covered commodity, direct 
     payment, effective price, extra long staple cotton, loan 
     commodity, other oilseed, payment acres, payment yield, 
     updated payment yield, producer, Secretary, State, target 
     price and United States. (Section 1001)


   Subtitle A--Fixed Decoupled Payments and Counter-Cyclical Payments

     (3) Payments to Eligible Producers
       The House bill provides that beginning with the 2002 crop 
     year, the Secretary will make fixed decoupled payments and 
     counter-cyclical payments to eligible producers, including 
     producers that would have been eligible for an AMTA contract 
     payment in 2002 and other producers of a covered commodity on 
     a farm in the United States as described in section 103(a).
       Defines a producer eligible to share in a fixed, decoupled 
     and counter-cyclical payment as ``an owner, operator, 
     landlord, tenant, or sharecropper who shares in the risk of 
     producing a crop and who is entitled to share in the crop 
     available for marketing from the farm, or would have shared 
     had the crop been produced. In determining whether a grower 
     of hybrid seed is a producer, the Secretary shall not take 
     into consideration the existence of a hybrid seed contract 
     and shall ensure that program requirements do not adversely 
     affect the ability of the grower to receive a payment under 
     this title''.
       Requires the Secretary to protect the interests of tenants 
     and sharecroppers in carrying out this title.
       Sharing of Contract Payments.--The Secretary shall provide 
     for the sharing of fixed, decoupled payments and counter-
     cyclical payments among the eligible producers on a farm on a 
     fair and equitable basis.
       The Senate amendment provides that the Secretary shall 
     offer to enter into a contract with an eligible owner or 
     producer on a farm containing eligible cropland under which 
     the eligible owner or producer will receive direct and 
     counter-cyclical payments under sections 113 and 114, 
     respectively.
       For each of the 2002 through 2006 fiscal years, the 
     Secretary shall make direct payments available to eligible 
     owners and producers on a farm that have entered into a 
     contract to receive payments under this section.
       For each of the 2002 through 2006 crop years, the Secretary 
     shall make counter-cyclical payments to eligible owners and 
     producers on a farm of each contract commodity that have 
     entered into a contract to receive payments under this 
     section.
       An eligible owner or producer on a farm, subject to the 
     provisions for share-rent tenants, cash-rent tenants and 
     cash-rent owners, shall be eligible to enter into a contract.
       Share-rent Tenant.--A producer on eligible cropland that is 
     a tenant with a share-rent lease of the eligible cropland 
     shall be eligible to enter into a contract, regardless of the 
     length of the lease, if the owner enters into the same 
     contract.
       Cash-Rent Tenant.--Contracts With Long-Term Lease--A 
     producer on eligible cropland that cash rents the eligible 
     cropland under a lease expiring on or after the termination 
     of the contract shall be eligible to enter into a contract.
       Contracts With Short-Term Lease.--A producer that cash 
     rents the eligible cropland under a lease expiring before the 
     termination of the contract shall be eligible to enter into a 
     contract in addition to the owner. Provides that the owner 
     must consent if a producer elects to enroll less than 100 
     percent of the eligible cropland in the contract.
       Cash-Rent Owner.--An owner of eligible cropland that cash 
     rents under a lease that expires before the end of the 2006 
     crop year shall be eligible to enter into a contract if the 
     tenant declines to do so, however the Secretary shall not 
     make contract payments to the owner under the contract until 
     the lease held by the tenant terminates.
       Requires the Secretary to protect the interest of tenants 
     and sharecroppers in carrying out this subtitle.
       Requires the Secretary to provide for the sharing of 
     contract payments among the eligible producers on a farm on a 
     fair and equitable basis. (Section 111)
       The Conference substitute deletes both the House and the 
     Senate provisions, except provides in section 1105 for the 
     protection of the interest of tenants and sharecroppers and 
     requires the sharing of direct and counter-cyclical payments 
     among the producers on a farm on a fair and equitable basis. 
     (Section 1105)
       The Managers intend that the Secretary will consider 
     acreage and production data from producers' federal crop 
     insurance records, as well as records provided to the Farm 
     Service Agency to qualify for market assistance loan benefits 
     during the relevant crop years.
     (4) Establishment of Payment Yield
       The House bill requires the Secretary to establish payment 
     yields for each farm for each covered commodity. The yield 
     for a farm will be the payment yield in effect for the 2002 
     crop of the commodity as provided under section 505 of the 
     Agricultural Act of 1949. If no yield is available, the 
     Secretary shall establish an appropriate payment yield taking 
     into account the payment yields applicable to the commodity 
     for similar farms in the area.
       Relative to soybeans and other oilseeds, the Secretary will 
     establish a yield for a farm by determining the average yield 
     from 1998 through 2001, excluding years where the acreage 
     planted to the oilseed was zero. If a farm would have 
     satisfied disaster eligibility requirements under the FY1999 
     Agriculture Appropriations Bill in any of the 1998 through 
     2001 crop years, the Secretary will assign a yield to the 
     farm equal to 65 percent of the county yield for that year in 
     determining the 4-year average.
       The payment yield for a farm for an oilseed shall be equal 
     to the product of the following: (A) the average yield for 
     the oilseed determined under paragraph (1). The ratio 
     resulting from dividing the national average yield for the 
     oilseed for the 1981 through 1985 crops by the national 
     average yield for the oilseed for the 1998 through 2001 
     crops. (Section 102)
       The Senate amendment provides that subject to subsection 
     (h), an eligible owner or producer that has entered into a 
     contract under this subtitle may make a 1-time election to 
     have the payment yield for each of the contract commodities 
     for a farm be equal to an amount that is the greater of: (1) 
     the average yield per harvested acre for the crop of the 
     contract commodity for the farm for the 1998-2001 crop years, 
     excluding any crop year for which the producers on the farm 
     did not plant the contract crop and, at the option of the 
     producers, 1 additional crop year or the farm program payment 
     yield adjusted for any additional yields. If no yield records 
     are available for a contract commodity, including land 
     devoted to oilseed under a conservation reserve contract, the 
     Secretary shall establish an appropriate payment yield taking 
     into account the payment yields applicable to the commodity 
     for similar farms in the area. (Section 111)
       The Conference substitute requires the Secretary to 
     establish payment yields for each farm for each covered 
     commodity. The yield for a farm will be the payment yield in 
     effect for the 2002 crop of the commodity as provided under 
     section 505 of the Agricultural Act of 1949, as adjusted by 
     the Secretary to account for any additional yield payments. 
     If no yield is available, the Secretary shall establish an 
     appropriate payment yield taking into account the payment 
     yields applicable to the commodity for similar farms in the 
     area, but before the yields for the similar farms are updated 
     to reflect the actual yield per planted acre for the period 
     1998 through 2001.
       Relative to soybeans and other oilseeds, the Secretary will 
     establish a yield for a farm by determining the average yield 
     from 1998 through 2001, excluding years where the acreage 
     planted to the oilseed was zero.
       The payment yield for a farm for an oilseed shall be equal 
     to the product of the following: (A) The average yield for 
     the oilseed for the 1998 through 2001 crops. (B) The ratio 
     resulting from dividing the national average yield for the 
     oilseed for the 1981 through 1985 crops by the national 
     average yield for the oilseed for the 1998 through 2001 
     crops.
       If the yield per planted acre for a crop of an oilseed for 
     a farm for any of the 1998 through 2001 crop years was less 
     than 75 percent of the county yield for that oilseed, the 
     Secretary shall assign a yield for that crop year equal to 75 
     percent of the county yield for purposes of determining the 
     average yield for the 1998 through 2001 crop years.
       If the owner of a farm elects to update the crop acreage 
     base for all covered commodities using the average of the 
     planted and prevented from planting acreage for 1998

[[Page H1902]]

     through 2001, the owner shall also have a 1-time opportunity 
     to elect to partially update the payment yields that would be 
     used in calculating any counter-cyclical payments for covered 
     commodities on the farm. If yields are updated for counter-
     cyclical payments for one covered commodity, they must be 
     updated for all covered commodities on the farm.
       If the owner of a farm elects to update yields for 
     payments, the counter-cyclical payment yield for a covered 
     commodity on the farm shall be equal to the yield determined 
     using either of the following: (A) The sum of the payment 
     yield applicable for direct payments for the covered 
     commodity on the farm and 70 percent of the difference 
     between the average of the yield per planted acre for the 
     crop of the covered commodity on the farm for the 1998 
     through 2001 crop years and the payment yield applicable for 
     direct payments for the covered commodity on the farm, or (B) 
     93.5 percent of the average yield per planted acre for the 
     crop of the covered commodity for the farm for the 1998 
     through 2001 crop years.
       If the yield per planted acre for a crop of the covered 
     commodity for a farm for any of the 1998 through 2001 crop 
     years was less than 75 percent of the county yield for that 
     commodity, the Secretary shall assign a yield for that crop 
     year equal to 75 percent of the county for the purpose of 
     determining the average yield.
       Owners electing to partially update yields are required to 
     have the partially updated yield determined on the average 
     yield per planted acre, excluding any year in which the crop 
     was not planted. The Managers intend that the Secretary 
     recognize that those producers planting crops for grazing 
     that will be included as base acreage are unable to furnish 
     production evidence similar to that furnished by producers 
     that harvest crops for grain. For those owners intending to 
     partially update a crop's counter-cyclical yield that have 
     this situation, the Managers intend for the Secretary to 
     equitably determine the yield on the grazed acreage to be 
     used for purposes of proven yields by either assigning a 
     yield based on the actual production for that year on similar 
     farms that harvested for grain or other method determined 
     appropriate by the Secretary. (Section 1102)
     (5) Establishment of Base Acres and Payment Acres for a Farm
       The House bill provides that the Secretary will give 
     producers a choice in determining their base acres. Producers 
     may choose base acres reflecting the four-year average of 
     acreage planted or prevented from being planted to the 
     commodity for harvest, grazing, haying, silage, and other 
     similar purposes during the 1998 through 2001 crop years. 
     Alternatively, producers may choose base acres reflecting 
     contract acreage that would otherwise be used to calculate 
     the fiscal year 2002 production flexibility contract 
     payments.
       Producers may make an election of base acres only once and 
     provide notice of the election to the Secretary no later than 
     180 days after the date of enactment of this Act. If a 
     producer fails to make an election of base acreage, or fails 
     to timely notify the Secretary of the selected base acreage, 
     the producers shall be deemed to have chosen base acres 
     reflecting the production flexibility contract acreage.
       The election made by the producer shall apply to all 
     covered commodities on the farm.
       In the case of producers on a farm that elect as their base 
     acreage the contract acreage used by the Secretary to 
     calculate the fiscal year 2002 payment, the Secretary will 
     restore base acres when land under a conservation reserve 
     contract expires, is voluntary terminated, or is released by 
     the Secretary. (Conservation Reserve Program Sign-up 1-14)
       For the fiscal year and crop year in which a base acre 
     adjustment is first made, the producers on the farm shall 
     elect to receive either fixed decoupled payments and counter-
     cyclical payments with respect to the acreage added to the 
     farm or a prorated payment under the conservation reserve 
     contract, but not both.
       In the case of producers on a farm that elect as their base 
     acreage the contract acreage used by the Secretary to 
     calculate the fiscal year 2002 payment, the Secretary will 
     restore base acres when land under a conservation reserve 
     contract expires, is voluntary terminated, or is released by 
     the Secretary. (Conservation Reserve Program Sign-up 15 and 
     greater)
       Payment acres for both the fixed decoupled and the counter-
     cyclical payment shall be equal to 85% of the base acres.
       The sum of base acres, peanut acres and acreage enrolled in 
     CRP, WRP, or other programs in which a producer agrees not to 
     produce a commodity on acreage in exchange for a payment, 
     cannot exceed the actual cropland acreage on the farm. The 
     Secretary shall give producers on the farm the opportunity to 
     select base acres or peanuts acres against which the 
     reduction will be made. The Secretary shall make an exception 
     in the case of double cropping. (Section 103)
       The Senate amendment provides that land shall be considered 
     to be cropland eligible for coverage under a contract only if 
     the land has with respect to a contract commodity, contract 
     acreage attributable to the land and a payment yield or was 
     subject to a conservation reserve contract with a term that 
     expired, or was voluntarily terminated on or after the date 
     of enactment.
       Provides that an eligible owner or producer may enroll as 
     contract acreage under this subtitle all or a portion of the 
     eligible cropland on the farm.
       Provides that an owner or producer that enters into a 
     contract may subsequently reduce the quantity of contract 
     acreage covered by the contract.
       Subject to subsection (h) the Secretary shall provide 
     eligible owners and producers on the farm with an opportunity 
     to elect 1 of the following methods as the method by which 
     the contract acreage for the 2002 through 2006 crops of all 
     contract commodities for a farm are determined: (1) the 4-
     year average of acreage planted or considered planted to a 
     contract commodity for harvest, grazing, haying, silage, or 
     other similar purposes during the 1998 through 2001 crop 
     years or (2) contract acreage that would be used to calculate 
     the fiscal year 2002 production flexibility contract payments 
     and the 4-year average for each oilseed produced on the farm.
       In making the contract acreage and yield elections, 
     eligible owners and producers on a farm shall elect to update 
     the contract acreage using the 4-year 1998 through 2001 
     average acreage and the 1998 through 2001 average yield per 
     harvested acre (adjusted for years with no planted acreage 
     and at the option of the producer, 1 additional crop year) or 
     the 2002 production flexibility contract crop acreage plus 
     the 4-year average of oilseeds and the farm program payment 
     yield for current contract crops and for oilseeds, the 1998 
     through 2001 average yield per harvested acre (adjusted for 
     years with no planted acreage and at the option of the 
     producer, 1 additional crop year).
       At the beginning of each fiscal year, the Secretary shall 
     allow an eligible owner or producer on a farm covered by a 
     conservation reserve contract that terminated after 180 days 
     after the enactment of this Act to enter into or expand a 
     contract to cover the eligible cropland of the farm that was 
     subject to the former conservation reserve contract.
       For the fiscal year and crop year for which a contract 
     acreage adjustment is made as a result of the termination of 
     a conservation reserve program contract the eligible owners 
     and producers on the farm shall elect to receive direct 
     payments and counter-cyclical payments with respect to the 
     acreage added to the farm or a prorated payment under the 
     conservation reserve contract.
       The sum of the contract acreage, peanut acres and acreage 
     enrolled in CRP, WRP, or other acreage on a farm enrolled in 
     a voluntary Federal conservation program under which 
     production of any agricultural commodity is prohibited, 
     cannot exceed the actual cropland acreage on a farm. The 
     Secretary shall give owners and producers on the farm the 
     opportunity to select contract acreage or peanut acres 
     against which the reduction will be made. The Secretary shall 
     take into account additional acreage as a result of an 
     established double-cropping history on a farm. (Section 111)
       The Conference substitute provides that for the purpose of 
     making direct and counter-cyclical payments to a farm, the 
     Secretary shall give an owner of the farm an opportunity to 
     elect the method by which the base acres of all covered 
     commodities on the farm are to be determined. Subject to the 
     provision requiring the base acreage to be determined based 
     on a 4-year average, including the years in which the crop 
     was not planted, and the treatment of multiple plantings or 
     prevented planting on the same acreage, owners may choose the 
     farms crop acreage base by either: (1) using the acreage 
     planted on the farm to covered commodities for harvest, 
     grazing, haying, silage, or other similar purposes for the 
     1998 through 2001 crop years including any acreage on the 
     farm that the producers were prevented from planting to 
     covered commodities because of drought, flood, or other 
     natural disaster, or other condition beyond the control of 
     the producers, as determined by the Secretary or (2) contract 
     acreage that would be used to calculate the fiscal year 2002 
     production flexibility contract payments and the 4-year 
     average for each oilseed produced on the farm for the 1998 
     through 2001 crop years. The eligible acreage for each 
     oilseed on a farm shall be the average of each oilseed for 
     the 1998 through 2001 crop years, except that the total 
     acreage for all oilseeds on the farm for a crop year may not 
     exceed the difference between the total acreage determined 
     for all covered commodities for that crop year and the total 
     contract acreage used by the Secretary to calculate the 
     fiscal year 2002 production flexibility contract payment.
       The owner of a farm may increase the eligible acreage for 
     an oilseed on the farm by reducing the production flexibility 
     contract acreage for one or more covered commodities on an 
     acre-for-acre-basis, except that the total base acreage for 
     each oilseed on the farm may not exceed the 4-year average of 
     each oilseed.
       The Secretary shall not exclude any crop year in which a 
     covered commodity was not planted for purposes of determining 
     a 4-year acreage average.
       For the purposes of determining the 4-year average of 
     acreage planted or prevented from being planted during the 
     1998 through 2001 crop years to covered commodities, acreage 
     that was planted or prevented from being planted that was 
     devoted to another covered commodity in the same crop year 
     may only be used in the base calculation after the owner 
     determines whether the initial commodity or the subsequent 
     commodity, but not both, will be used.

[[Page H1903]]

       As soon as practicable after the date of enactment of this 
     Act, the Secretary shall provide notice to owners of farms 
     regarding their opportunity to make the applicable base 
     election. The notice shall include: (1) notice that the 
     opportunity of an owner to make the election is being 
     provided only once and (2) information regarding the manner 
     in which the election must be made and the time periods and 
     manner in which notice of the election must be submitted to 
     the Secretary.
       The owner may make an election of base acres only once and 
     must provide notice of the election to the Secretary within 
     the time period and in the manner prescribed by the 
     Secretary. If an owner fails to make an election of base 
     acreage, or fails to timely notify the Secretary of the 
     election made, the owner shall be deemed to have chosen base 
     acres reflecting the production flexibility contract acreage, 
     plus oilseeds if applicable.
       The election made by the producer shall apply to all 
     covered commodities on the farm.
       The Secretary shall provide for an appropriate adjustment 
     in the base acres for covered commodities for a farm whenever 
     land under a conservation reserve contract expires, is 
     voluntary terminated, or is released by the Secretary.
       For the crop year in which a base acre adjustment is first 
     made, the owner on the farm shall elect to receive either 
     direct payments and counter-cyclical payments with respect to 
     the acreage added to the farm or a prorated payment under the 
     conservation reserve contract, but not both.
       Payment acres for both the direct and the counter-cyclical 
     payment shall be equal to 85% of the base acres.
       The sum of base acres, base acres for peanuts and acreage 
     enrolled in CRP, WRP, or other conservation programs which 
     restrict or prohibit the production of an agricultural 
     commodity cannot exceed the actual cropland acreage on the 
     farm. The Secretary shall give producers on the farm the 
     opportunity to select base acres or base acres for peanuts 
     against which the reduction will be made. The Secretary shall 
     make an exception in the case of double cropping.
       The owner of a farm may reduce, at any time, base acreage 
     for any covered commodity for the farm provided the reduction 
     of base acreage is permanent.
       In implementing Section 1101, the Secretary shall also 
     allow owners of a farm who did not hold a production 
     flexibility contract under the Federal Agriculture 
     Improvement and Reform Act of 1996 to elect to calculate base 
     acreage for planting history on the farm for crop years 1998-
     2001. The intent of this section is to provide the 
     opportunity to owners to update base acreage to reflect a 
     more recent planting history, to allow owners not holding a 
     production flexibility contract to receive farm program 
     benefits under this Act, and to allow owners holding 
     production flexibility contracts the opportunity to retain 
     their base acreage and add oilseeds in a limited manner.
       The Managers expect the Secretary to recognize that 
     although the owner of the farm will be allowed the 
     opportunity to make the applicable base election under 
     Section 1101, it is important that other producers on the 
     farm are notified of the acreage options available to the 
     owner. In addition to providing notice to the owner of the 
     farm, the Managers expect the Secretary to provide notice to 
     operators or producers on a farm of the owner's opportunity 
     to elect the method in which to calculate base acres at the 
     time the Secretary provides notice to the owner.
       The Managers are aware that production flexibility contract 
     acreage was not protected on acreage enrolled into the 
     Conservation Reserve Program during CRP signup number 15 and 
     later. The Managers intend that the Secretary develop a 
     method that provides for the restoration of base acreage on 
     farms that permanently reduced contract acreage because of 
     enrollment in CRP. Since soybeans and other oilseeds did not 
     have contract acreage prior to this Act, the Managers expect 
     the Secretary to treat soybeans and other oilseeds in a 
     manner that is similar and consistent with other covered 
     commodities. (Section 1101)
     (5) Elements of Contracts
       The Senate amendment provides the Time for Contracting--
       (1) Commencement.--To the extent practicable, the Secretary 
     shall commence entering into contracts not later than 45 days 
     after the date of enactment of this title.
       (2) Except as provided in paragraph the Secretary may not 
     enter into a contract after the date that is 180 days after 
     the date of enactment.
       (3) At the beginning of each fiscal year, the Secretary 
     shall allow an eligible owner or producer on a farm with a 
     conservation reserve contract that terminated after the final 
     date to enroll eligible cropland in a direct and counter-
     cyclical payment contract to enter into or expand a contract 
     to cover the eligible cropland that was subject to the former 
     conservation reserve contract.
       Duration of Contract.--The term of a contract shall begin 
     with the 2002 crop or in the case of acreage that was subject 
     to a conservation reserve contract that is subsequently 
     terminated, the date the contract was entered into or 
     expanded to cover the terminated acreage. Unless earlier 
     terminated by eligible owners or producer, the contract shall 
     extend through the 2006 crop. (Section 111)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (6) Availability of Fixed, Decoupled Payments
       The House bill provides that the Secretary shall make fixed 
     decoupled payments to eligible producers for each of the 2002 
     through 2011 crop years at a payment rate of $0.53 per bushel 
     for wheat, $0.30 per bushel for corn, $0.36 per bushel for 
     grain sorghum, $0.25 per bushel for barley, $0.025 per bushel 
     for oats, $0.0667 per pound for upland cotton, $2.35 per 
     hundredweight for rice, $0.42 per bushel for soybeans, and 
     $0.0074 per pound for other oilseeds.
       The amount of the fixed, decoupled payment will be equal to 
     the product of the payment rate of the applicable base crop, 
     the payment acres, and the payment yield.
       Fixed decoupled payments shall be paid no later than 
     September 30 of fiscal years 2002 through 2011, except that 
     in fiscal year 2002 payments may be made on or after December 
     1, 2001.
       A producer may elect to receive 50 percent of the fixed 
     decoupled payment in advance anytime on or after December 1 
     of a fiscal year. The producer may change the selected date 
     for a subsequent fiscal year by providing advance notice to 
     the Secretary.
       If a producer who receives an advance fixed decoupled 
     payment ceases to be an eligible producer by the time final 
     fixed decoupled payments are to be made, the producer must 
     repay the advance amount.
       The Senate amendment provides that the Secretary shall make 
     direct payments available to eligible owners and producers 
     that have entered into a contract at a payment rate as 
     follows:

----------------------------------------------------------------------------------------------------------------
                                                                      2002-03         2004-05          2006
----------------------------------------------------------------------------------------------------------------
Wheat (bu)......................................................           $0.45          $0.225         $0.113
Corn (bu).......................................................            0.27           0.135          0.068
Barley (bu).....................................................            0.20           0.100          0.050
Oats (bu).......................................................            0.05           0.025          0.013
Cotton (lb).....................................................            0.13           0.065          0.0325
Rice (cwt)......................................................            2.45           2.400          2.400
Soybeans (bu)...................................................            0.55           0.275          0.138
Other oilseeds (lb).............................................            0.01           0.005          0.0025
Grain sorghum (bu)..............................................      2002--0.31           0.135          0.068
                                                                      2003--0.27
----------------------------------------------------------------------------------------------------------------

       The amount of direct payment will be equal to the product 
     of the payment rate for the contract crop for the applicable 
     year, contract acreage and the payment yield.
       A final direct payment (less the amount of any initial 
     payment made to the producers on the farm of the contract 
     commodity) shall be made not later than September 30 of the 
     fiscal year.
       A producer may elect to receive 50% of the direct payment 
     in advance anytime on or after December 1 of the fiscal year. 
     (Section 111)
       The Conference substitute provides that the Secretary shall 
     make direct payments to eligible producers for each of the 
     2002 through 2007 crop years at a payment rate of $0.52 per 
     bushel for wheat, $0.28 per bushel for corn, $0.35 per bushel 
     for grain sorghum, $0.24 per bushel for barley, $0.024 per 
     bushel for oats, $0.0667 per pound for upland cotton, $2.35 
     per hundredweight for rice, $0.44 per bushel for soybeans, 
     and $0.008 per pound for other oilseeds.
       The amount of the direct payment will be equal to the 
     product of the payment rate of the applicable base crop, the 
     payment acres, and the payment yield.
       For 2002, the Secretary is directed to make payments as 
     soon as practicable after the date of enactment of this Act 
     and for 2002 through 2007, but not before October 1 of the 
     calendar year in which the crop of the covered commodity is 
     harvested.
       A producer may elect to receive up to 50 percent of the 
     direct payment in advance in any month after December 1 of 
     the calendar year before the calendar year in which the crop 
     of the covered commodity is harvested. The producer may 
     change the selected month for a subsequent crop year by 
     providing advance notice to the Secretary.
       If a producer who receives an advance fixed decoupled 
     payment ceases to be a producer or changes share before the 
     date the remainder of the direct payments are to be made, the 
     producer must repay the applicable amount of the advance 
     payment.
       The Managers are aware that producers that elect to receive 
     up to 50 percent of an advance direct payment might cease to 
     be a producer on the farm before the date the remainder of 
     the direct payment is made. The Managers assume the Secretary 
     recognizes that different reasons exist for a producer 
     ceasing to be a producer on a farm. These reasons would 
     include bankruptcy, foreclosure and other similar situations 
     that would preclude the producer from repaying the advance 
     direct payment. Specifically, the Managers would not intend 
     for this provision to apply in situations where a producer 
     with winter wheat harvested a crop or failed to harvest the 
     crop for weather related reasons beyond their control and the 
     acreage was subsequently under the control of another 
     producer that intended to plant a subsequent crop, or other 
     similar situations. Conversely, the Managers expect there are 
     a number of situations where the producer receiving the 
     advance direct payment ceases to be a producer on the farm 
     and should refund the advance direct payment. (Section 1103)
     (7) Availability of Counter-Cyclical Payments
       The House bill provides that the Secretary shall make 
     counter-cyclical payments relative to a covered commodity 
     whenever the effective price is less than the target price.

[[Page H1904]]

       The target price is $4.04 per bushel for wheat, $2.78 per 
     bushel for corn, $2.64 per bushel for grain sorghum, $2.39 
     per bushel for barley, $1.47 per bushel for oats, $0.736 per 
     pound for upland cotton, $10.82 per hundredweight for rice, 
     $5.86 per bushel for soybeans, and $0.1036 per pound for 
     other oilseeds.
       The effective price is equal to the sum of (1) the higher 
     of the national average market price during the 12-month 
     marketing year for the commodity or the national average loan 
     rate for the commodity, and (2) the payment rate for fixed 
     decoupled payments for the commodity.
       The payment rate for counter-cyclical payments is equal to 
     the difference between the target price and the effective 
     price for the commodity.
       The payment amount for counter-cyclical payments is the 
     product of the payment rate, the payment acres, and the 
     payment yield.
       The Secretary shall make counter-cyclical payments for a 
     covered commodity as soon as possible after determining that 
     such payments are required.
       The Secretary may provide a partial payment up to 40 
     percent of the projected counter-cyclical payment to 
     producers upon completion of the first 6 months of the 
     marketing year for that crop.
       The producer must repay the amount, if any, by which the 
     partial payment exceeds the counter-cyclical payment to be 
     made in that crop year.
       If the Secretary uses the authority to designate another 
     oilseed for counter-cyclical payments the Secretary may 
     modify the target price in subsection (c) (9) that would 
     otherwise apply to that oilseed.
       For purposes of calculating the effective price for barley 
     the Secretary shall use the loan rate in effect for barley 
     under section 122(b)(3) except in the case of producers who 
     received the higher loan rate provided under such section for 
     barley used only for feed purposes, the Secretary shall use 
     the that higher loan rate. (Section 105)
       The Senate amendment provides that the Secretary shall make 
     counter-cyclical payments relative to a contract commodity to 
     owners and producers on a farm that have entered into a 
     contract to receive such payments.
       The income protection price is $3.4460 per bushel for 
     wheat, $2.3472 per bushel for corn, $2.3472 per bushel for 
     grain sorghum, $2.1973 per bushel for barley, $1.5480 per 
     bushel for oats, $0.6793 per pound for upland cotton, $9.2914 
     per hundredweight for rice, $5.7431 per bushel for soybeans, 
     and $0.1049 per pound for other oilseeds.
       The payment rate for counter-cyclical payments shall equal 
     the difference between the income protection price and the 
     total of the higher of (1) the average price of the contract 
     commodity during the first 5 months of the marketing year of 
     the contract commodity or the loan rate for the commodity, 
     and (2) the direct payment for the contract crop for the 
     fiscal year that precedes the date of payment under this 
     section.
       The payment amount for counter-cyclical payments is the 
     product of the payment rate for the contract crop, the 
     contract acreage, and the payment yield.
       The Secretary shall make counter-cyclical payments not 
     later than 190 days after the beginning of the marketing year 
     for the applicable contract crop. (Section 114)
       The Conference substitute provides that the Secretary shall 
     make counter-cyclical payments to producers on farms for 
     which payment yields and bases acres are established with 
     respect to a covered commodity whenever the effective price 
     is less than the target price.
       The effective price is equal to the sum of (1) the higher 
     of the national average market price during the 12-month 
     marketing year for the commodity or the national average loan 
     rate for the commodity, and (2) the payment rate for direct 
     payments for the commodity.
       For the 2002 and 2003 crop years, the target price is $3.86 
     per bushel for wheat, $2.60 per bushel for corn, $2.54 per 
     bushel for grain sorghum, $2.21 per bushel for barley, $1.40 
     per bushel for oats, $0.724 per pound for upland cotton, 
     $10.50 per hundredweight for rice, $5.80 per bushel for 
     soybeans, and $0.098 per pound for other oilseeds.
       For the 2004 and 2007 crop years, the target price is $3.92 
     per bushel for wheat, $2.63 per bushel for corn, $2.57 per 
     bushel for grain sorghum, $2.24 per bushel for barley, $1.44 
     per bushel for oats, $0.724 per pound for upland cotton, 
     $10.50 per hundredweight for rice, $5.80 per bushel for 
     soybeans, and $0.1010 per pound for other oilseeds.
       The payment rate for counter-cyclical payments is equal to 
     the difference between the target price and the effective 
     price for the commodity.
       The payment amount for counter-cyclical payments is the 
     product of the payment rate, the payment acres, and the 
     payment yield or updated payment yield, depending on the 
     election of the owner of the farm.
       If the Secretary determines that a counter-cyclical payment 
     is required to be made for a covered commodity, the Secretary 
     shall make the counter-cyclical payments for the crop as soon 
     as practicable after the end of the 12-month marketing year 
     for the covered commodity.
       If the Secretary estimates counter-cyclical payments will 
     be required, the Secretary shall give producers the option to 
     receive partial payments.
       When the Secretary makes partial payments for any of the 
     2002 through 2006 crop years, the first partial payment for 
     the crop shall be made not earlier than October 1 and to the 
     maximum extent practicable, not later than October 31, of the 
     calendar year in which the crop is harvested. The second 
     partial payment shall be made not earlier than February 1 of 
     the next calendar year and the third and final partial 
     payment shall be made as soon as practicable after the end of 
     the 12-month marketing year for the covered commodity.
       For the 2002 through 2006 crop years, the first partial 
     payment may not exceed 35 percent of the projected counter-
     cyclical payment for the covered commodity for the crop year. 
     The second partial payment may not exceed the difference 
     between 70 percent of the revised projection of the counter-
     cyclical payment for the crop of the covered commodity and 
     the amount of the payment made under clause (i). The final 
     payment shall be equal to the difference between the actual 
     counter-cyclical payment to be made to the producer and the 
     amount of the first and second partial payment.
       For the 2007 crop year, the first partial payment shall be 
     made after completion of the first 6 months of the marketing 
     year and the second and final partial payment shall be made 
     as soon as practicable after the end of the 12-month 
     marketing year for the covered commodity.
       For the 2007 crop year, the first partial payment may not 
     exceed 40 percent of the projected counter-cyclical payment. 
     The final payment shall be equal to the difference between 
     the actual counter-cyclical payment to be made to the 
     producer and the amount of the partial payment.
       The producer must repay the amount, if any, by which the 
     partial payment exceeds the counter-cyclical payment to be 
     made in that crop year. (Section 1104)
     (8) Producer Agreement Required as Condition on Provision of 
         Fixed, Decoupled Payments and Counter-Cyclical Payments
       The House bill provides that before producers on a farm may 
     receive fixed, decoupled payments or counter-cyclical 
     payments with respect to the farm, the producers shall agree, 
     in exchange for the payments to comply with applicable 
     conservation requirements, applicable wetland protection 
     requirements, planting flexibility requirements and to use 
     the land on the farm, in an amount equal to the base acres, 
     for an agricultural or conserving use, and not for a 
     nonagricultural commercial or industrial use, as determined 
     by the Secretary.
       The Secretary may issue such rules to ensure compliance 
     with these requirements.
       A producer may not be required to make repayments to the 
     Secretary of fixed, decoupled payments and counter-cyclical 
     payments if the farm has been foreclosed on and the Secretary 
     determines that forgiving the repayments is appropriate to 
     provide fair and equitable treatment. This subsection shall 
     not void the responsibilities of the producer to comply with 
     conservation, wetlands protection, planting flexibility and 
     agriculture land use requirements if the producer continues 
     or resumes operation, or control of the farm. On the 
     resumption of operation or control over the farm by the 
     producer, the above noted requirements in effect on the date 
     of the foreclosure shall apply.
       A transfer of (or change in) the interest of a producer in 
     base acres for which fixed decoupled or counter-cyclical 
     payments are made shall result in the termination of the 
     payments with respect to bases acres, unless the transferee 
     or owner of the acreage agrees to assume all obligations 
     under conservation, wetland, planting flexibility or 
     agriculture land use provisions. The termination shall be 
     effective on the date of the transfer or change.
       There is no restriction on the transfer of base acres or 
     payment yield as part of a change in the producers on the 
     farm.
       At the request of the transferee or owner, the Secretary 
     may modify the conservation, wetlands protection, planting 
     flexibility and agriculture land use requirements if the 
     modifications are consistent with the objectives of such 
     subsection, as determined by the Secretary.
       If a producer entitled to a fixed, decoupled payment or 
     counter-cyclical payment dies, becomes incompetent, or is 
     otherwise unable to receive the payment, the Secretary shall 
     make the payment, in accordance with regulations prescribed 
     by the Secretary.
       Requires a producer who receives fixed decoupled payments, 
     counter-cyclical payments, or marketing loan assistance to 
     submit acreage reports to the Secretary.
       A determination of the Secretary under this section shall 
     be considered an adverse decision for purposes of 
     availability of administrative review. (Section 106)
       The Senate amendment provides that under the terms of a 
     contract, the owner or producer shall agree, in exchange for 
     annual payments to comply with applicable highly erodible 
     land conservation requirements, applicable wetland 
     conservation requirements, planting flexibility requirements 
     and to use a quantity of land on the farm equal to the 
     contract acreage, for an agricultural or conserving use, and 
     not for a nonagricultural commercial or industrial use, as 
     determined by the Secretary. (Section 111)
       The Conference substitute provides that before producers on 
     a farm may receive direct payments or counter-cyclical 
     payments with respect to the farm, the producers shall

[[Page H1905]]

     agree, in exchange for the payments to comply with applicable 
     conservation requirements, applicable wetland protection 
     requirements, planting flexibility requirements, to use the 
     land on the farm in a quantity attributable to the base acres 
     for an agricultural or conserving use and not for a 
     nonagricultural commercial or industrial use, as determined 
     by the Secretary and on noncultivated land attributable to 
     the base acres, control noxious weeds and otherwise maintain 
     the land in accordance with sound agricultural practices.
       The Secretary may issue rules to ensure compliance with 
     these requirements.
       At the request of the transferee or owner, the Secretary 
     may modify the requirements of this subsection if the 
     modifications are consistent with the objectives of such 
     subsection, as determined by the Secretary.
       A transfer of (or change in) the interest of a producer in 
     base acres for which direct or counter-cyclical payments are 
     made shall result in the termination of the payments with 
     respect to bases acres, unless the transferee or owner of the 
     acreage agrees to assume all obligations under conservation, 
     wetland, planting flexibility, agriculture land use 
     provisions and controlling noxious weeds provisions. The 
     termination shall take effect on the date determined by the 
     Secretary.
       If a producer entitled to a direct payment or counter-
     cyclical payment dies, becomes incompetent, or is otherwise 
     unable to receive the payment, the Secretary shall make the 
     payment, in accordance with regulations prescribed by the 
     Secretary.
       A producer who receives direct payments, counter-cyclical 
     payments, or marketing loan benefits is required to submit 
     annual acreage reports with respect to all cropland on the 
     farm to the Secretary.
       The Secretary shall provide adequate safeguards to protect 
     the interests of tenants and sharecroppers.
       The Secretary shall provide for the sharing of direct 
     payments and counter-cyclical payments among the producers on 
     a farm on a fair and equitable basis.
       When there is a transfer (or change in) the interest of a 
     producer in base acres for which direct or counter-cyclical 
     payments are made, the Managers intend for the Secretary to 
     provide a time frame for the succession to occur that is 
     farmer-friendly.
       Acreage reports provide important information such as 
     assisting in determining the eligibility of land to be 
     accepted into the Conservation Reserve Program. The Managers 
     are aware that in prior years, the Secretary has imposed 
     penalties on producers that submit acreage reports that the 
     Secretary later determines to be inaccurate. The Managers 
     understand that under prior acreage limiting and acreage 
     reduction programs there was a need for very accurate 
     reporting. However, under this Act, with the exception of 
     determining the amount of fruits, vegetables, and wild rice 
     planted on base acreage, there is no such need or requirement 
     for the level of accuracy. Therefore, under this provision 
     the Managers do not intend for any penalty to be applicable 
     to inaccurate acreage reports on covered commodities or 
     peanuts, provided the producer has made a good faith effort 
     to accurately report acreage. (Section 1105)
     (9) Violations of Contracts
       The Senate amendment is the same as current law except for 
     amending language in existing law to add a provision for a 
     planting flexibility violation. Makes corrections to add:
       Planting Flexibility.--In the case of a first violation of 
     the planting flexibility provisions by an eligible owner or 
     producer that has entered into a contract and that acted in 
     good faith, in lieu of terminating the contract under 
     subsection (a), the Secretary shall require a refund or 
     reduce a future contract payment under subsection (b) in an 
     amount that does not exceed twice the amount otherwise 
     payable under the contract on the number of acres involved in 
     the violation. (Section 112)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (10) Planting Flexibility
       The House bill provides that all rules concerning planting 
     flexibility are unchanged with the exception of adding wild 
     rice as a prohibited crop.
       Subject to the limitations in subsection (b), any commodity 
     may be planted on base acres on a farm.
       The planting of fruits, vegetables (excluding lentils, mung 
     beans, and dry peas) and wild rice are prohibited on base 
     acres.
       The 3 exceptions to this rule in current law are also 
     unchanged.
       (1) Fruits, vegetables or wild rice may be planted on base 
     acres in a region where the Secretary determines there is a 
     history of double cropping of covered commodities with 
     fruits, vegetables or wild rice.
       (2) Fruits, vegetables or wild rice may be planted on base 
     acres on a farm that the Secretary determines has a history 
     of planting fruits, vegetables or wild rice on base acres, 
     except that fixed decoupled payments and counter-cyclical 
     payments will be reduced for each acre planted. Fruits and 
     vegetables also may be planted by a producer who the 
     Secretary determines has an established planting history 
     of a specific fruit, vegetable or wild rice, except that 
     the quantity planted may not exceed the producer's annual 
     planting history of such agricultural commodity from the 
     1991 through 1995 crop years, as determined by the 
     Secretary, and fixed, decoupled payments and counter-
     cyclical payments will be reduced for each acre planted. 
     (Section 107)
       The Senate amendment provides that all rules concerning 
     planting flexibility are unchanged with the exception of 
     adding chickpeas as a permitted exception, wild rice as a 
     prohibited crop for 2003 and beyond, and by changing the base 
     period from 1991 through 1995 to 1996 through 2001 to 
     establish a planting history for a producer.
       Limitations.--The planting of the following agricultural 
     commodities shall be prohibited on contract acreage: (A) 
     Fruits. (B) Vegetables (other than lentils, mung beans, dry 
     peas, and chickpeas). (C) In the case of the 2003 and 
     subsequent crops of an agricultural commodity, wild rice'';
       Same as current law except for the change in base period 
     (for a producer) as noted directly below.
       Sec. 118(b)(2)(C) by striking ``1991 through 1995'' and 
     inserting ``1996 through 2001''. (Section 113)
       The Conference substitute adopts the House provision with 
     an amendment that provides that the planting of fruits, 
     vegetables (other than lentils, mung beans and dry peas) and 
     wild rice shall be prohibited on base acreage unless the 
     commodity, if planted, is destroyed before harvest.
       The planting of fruits and vegetables produced on trees and 
     other perennials shall be prohibited on base acres.
       The Secretary shall establish a producer planting history 
     for fruits, vegetables and wild rice planted by the producers 
     on the farm in the 1991 through 1995 or 1998 through 2001 
     crop years.
       For the 2002 crop year, if the calculation of base acres 
     results in total base acres for a farm in excess of the 
     contract acreage for the farm that was used to calculate the 
     fiscal year 2002 payment, the planting of fruits, vegetables 
     and wild rice on new base acres is allowed, provided the 
     direct and counter-cyclical payments for the 2002 crop year 
     are reduced on an acre-for-acre basis. (Section 1106)
     (11) Relation to Remaining Payment Authority Under Production 
         Flexibility Contracts
       The House bill provides authority to make production 
     flexibility contract payments for the 2002 fiscal year is 
     terminated upon enactment. If a producer receives an PFC 
     contract payment for the 2002 fiscal year before enactment of 
     this legislation, the amount of the producer's fixed 
     decoupled payment for fiscal year 2002 will be reduced by the 
     amount of the PFC contract payment. (Section 108)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment that terminates the authority of the Secretary 
     to make production flexibility contract payments on the date 
     of the enactment of this Act, unless requested by the 
     producer. Any direct payments due a producer under this Act 
     would be reduced by any fiscal year 2002 payments made under 
     a production flexibility contract. (Section 1107)
     (12) Payment Limitations
       The House bill provides fixed decoupled payments and 
     counter-cyclical payments are subject to the payment 
     limitations contained in sections 1001 through 1001C of the 
     Food Security Act of 1985 as amended. Limitations are based 
     on a crop year and the fixed, decoupled limitation is $50,000 
     and the counter-cyclical limitation is $75,000. (Section 109)
       The Senate amendment amends Section 1001 of the Food 
     Security Act of 1985. The total of direct and counter-
     cyclical payments that an individual or entity may receive 
     during any fiscal year for program commodities shall not 
     exceed $75,000. The total of marketing loan gains, forfeiture 
     gains, gains from marketing certificates and loan deficiency 
     payments that a person is entitled to receive for program 
     crops, peanuts, honey and wool is $150,000 per crop year.
       During a fiscal and corresponding crop year, the total 
     amount of payments and benefits that a married couple may 
     receive from direct, counter-cyclical and marketing loan is 
     $75,000 and $150,000 respectively, plus a combined total of 
     an additional $50,000.
       Provides that an individual or entity shall not be eligible 
     for a direct, income-protection and marketing loan program 
     benefits if the average adjusted gross income of the 
     individual or entity exceeds $2.5 million. (Section 169)
       The Conference substitute provides the total direct and 
     counter-cyclical payments to a person for corn, grain 
     sorghum, barley, oats, wheat, soybeans, minor oilseeds, 
     cotton and rice may not exceed $40,000 and $65,000, 
     respectively. The total marketing loan gains and loan 
     deficiency payments for corn, grain sorghum, barley, oats, 
     wheat, soybeans, minor oilseeds, cotton, rice, lentils, dry 
     peas and small chickpeas that a person is entitled to receive 
     is $75,000.
       Provides for a separate direct and counter-cyclical payment 
     limitation for peanuts of $40,000 and $65,000, respectively. 
     Provides for a separate marketing loan gain and loan 
     deficiency payments limitation for peanuts, wool, mohair and 
     honey of $75,000.
       Retains current rules on husband and wife, 3-entities, 
     actively engaged, generic certificates and adopts the $2.5 
     million adjusted gross income means test.
       The Conference substitute refers to levels of adjusted 
     gross income or comparable measures of income. The Managers 
     intend

[[Page H1906]]

     that the comparable measure provision be utilized when 
     necessary and in cases of applicants for whom, because of 
     their status under the Internal Revenue Code, adjusted gross 
     income is not measured or reported. For example, participants 
     who are organized as C Corporations, S Corporations, or as 
     nonprofit organizations, the Managers intend for the 
     Secretary to use this direction to adopt alternative income 
     measurements that compare most closely to adjusted gross 
     income. The Managers expect the Secretary to implement this 
     provision in a manner that provides equitable treatment, to 
     the maximum extent practicable to all producers regardless of 
     the legal structure of their farming operation.
       For purposes of subsection (b), the Managers expect the 
     Secretary to determine the individual or entity to be 
     ineligible only if the adjusted gross income or similar 
     equivalent exceeds $2.5 million and less than 75 percent of 
     the adjusted gross income is derived from farming, ranching 
     or forestry operations as determined by the Secretary. 
     (Section 1603)
     (13) Period of Effectiveness
       The House bill provides that the subtitle is effective from 
     the 2002 crop year through the 2011 crop year. (Section 110)
       The Senate amendment provides that the term of a contract 
     shall extend through the 2006 crop, unless earlier terminated 
     by the eligible owners or producers on a farm. (Section 111)
       The Conference substitute adopts the House provision with 
     an amendment that the subtitle is effective through the 2007 
     crop year. (Section 1109)
     (14) Pilot Program for Farm Counter-Cyclical Savings Accounts
       The Senate amendment amends Subtitle B of title I of the 
     Federal Agriculture Improvement and Reform Act of 1996 (7 
     U.S.C 7211 et seq.) to authorize and fund a pilot program for 
     farm counter-cyclical savings accounts. Eligible producers 
     may establish such accounts in the name of the producer in a 
     bank or financial institution selected by the producer and 
     approved by the Secretary of Agriculture. A savings account 
     shall consist of B contributions of the producer; matching 
     contributions of the Secretary; and interest earned on 
     account balances.
       To be eligible, a producer must share in the risk of 
     producing an agricultural commodity for the applicable year; 
     have filed a farm business-related federal income tax return 
     during each of the previous 5 years, or be a beginning farmer 
     or rancher, and have at least $50,000 in average adjusted 
     gross farm revenue, except for limited resource farmers as 
     determined by the Secretary.
       An eligible producer may deposit such amounts in the 
     account of the producer as the producer considers 
     appropriate. The Secretary shall provide a matching 
     contribution on the amount deposited by the producer into the 
     account, except that matching contributions may not exceed 2 
     percent of the producer's average adjusted gross farm 
     revenue, or $5,000 for any applicable fiscal year. The 
     Secretary shall provide the required matching contributions 
     for a producer as of the date that a majority of the 
     commodities grown by the producer are harvested.
       In any year, a producer may withdraw funds from the account 
     in an amount up to the difference between 90 percent of the 
     producer's average adjusted gross revenue and the producers 
     adjusted gross revenue in that year. A producer that ceases 
     to be actively engaged in farming, as determined by the 
     Secretary, may withdraw the full balance from, and close, the 
     account; and may not establish another account.
       The Secretary shall administer this program through the 
     Farm Service Agency and local, county, and area offices of 
     the Agriculture Department. For each of fiscal years 2003 
     through 2005, the Secretary shall establish a farm counter-
     cyclical savings account pilot program in 3 States, as 
     determined by the Secretary. The total amount of matching 
     contributions in a State may not exceed $4 million per State 
     for each of fiscal years 2003 through 2005. (Section 114)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.


  subtitle b--marketing assistance loans and loan deficiency payments

     (15) Availability of Nonrecourse Marketing Assistance Loans 
         for Covered Commodities
       The House bill provides that the Secretary shall make 
     available to producers on a farm nonrecourse marketing 
     assistance loans for covered commodities produced on the 
     farm, including extra long staple cotton, for each of the 
     2002 through 2011 crop years.
       Any production of a covered commodity on a farm is eligible 
     for a marketing assistance loan.
       Producers that would otherwise be eligible for the 
     assistance, but for the fact the covered commodity is 
     commingled with covered commodities of other producers in 
     facilities unlicensed for the storage of commodities, if the 
     producer obtaining the loan agrees to immediately redeem the 
     loan collateral.
       Producers are required to comply with applicable 
     conservation requirements and applicable wetland protection 
     requirements as a condition to receiving marketing loan 
     assistance.
       Extra long staple cotton is defined.
       Marketing assistance loans for the 2002 crop of covered 
     commodities shall not be made under subtitle C of title I of 
     such Act. (Section 121)
       The Senate amendment provides that the Secretary shall make 
     available to producers on a farm nonrecourse marketing 
     assistance loans for loan commodities produced on the farm 
     through the 2006 crop.
       The FAIR Act is amended by striking the definition of 
     eligible production and redefining as: Eligible Production.--
     The producers on a farm shall be eligible for a marketing 
     loan under subsection (a) for any quantity of a loan 
     commodity produced on the farm.
       Sec. 169 may restrict quantity. (Section 121)
       The Conference substitute provides that the Secretary shall 
     make available to producers on a farm nonrecourse marketing 
     assistance loans for loan commodities produced on the farm, 
     including extra long staple cotton, wool, mohair, honey, dry 
     peas, lentils and small chickpeas for each of the 2002 
     through 2007 crop years.
       Any production of a loan commodity on a farm is eligible 
     for a marketing assistance loan, however loan commodities 
     harvested for hay and silage, and unshorn pelts are eligible 
     only for a loan deficiency payment.
       The Secretary shall make loans to producers that would 
     otherwise be eligible for the assistance, but for the fact 
     the loan commodity is commingled with loan commodities of 
     other producers in facilities unlicensed for the storage of 
     commodities, if the producer obtaining the loan agrees to 
     immediately redeem the loan collateral.
       Producers are required to comply with applicable 
     conservation requirements and applicable wetland protection 
     requirements as a condition to receiving marketing loan 
     assistance.
       Marketing assistance loans for the 2002 crop of loan 
     commodities shall not be made under subtitle C of title I of 
     the Federal Agriculture Improvement and Reform Act of 1996.
       Beginning with the 2002 crop, the Managers intend for 
     marketing loan and loan deficiency program benefits to be 
     made available for all farms producing loan commodities, 
     regardless of whether the farm does or does not have base 
     acreage. (Section 1201)
     (16) Loan Rates for Nonrecourse Marketing Assistance Loans
       The House bill provides loan rates (per bushel or pound, as 
     applicable) are maintained at not more than $2.58 for wheat, 
     $1.89 for corn and grain sorghum, $1.65 for barley except not 
     more than $1.70 for barley used only for feed purposes, $1.21 
     for oats, $0.5192 for upland cotton (and not less than 
     $0.50), $0.7965 for extra long staple cotton, $4.92 for 
     soybeans, and $0.087 for other oilseeds, and equal to 
     $6.50 per cwt. for rice.
       Amends section 162(b) of the FAIR Act by striking ``this 
     title'' and inserting ``this title and title I of the Farm 
     Security Act of 2001''. (Section 122)
       The Senate amendment provides loan rates are $2.9960 per 
     bushel for wheat, $2.0772 per bushel for corn and grain 
     sorghum, $1.9973 per bushel for barley, $1.4980 per bushel 
     for oats, $0.5493 per pound for upland cotton, $0.7965 per 
     pound for extra long staple cotton, $6.4914 per hundredweight 
     for rice, $5.1931 per bushel for soybeans, $0.0949 per pound 
     for other oilseeds, $6.78 per hundredweight for dry peas, 
     $12.79 per hundredweight for lentils, $17.44 per 
     hundredweight for large chickpeas and $8.10 per hundredweight 
     for small chickpeas.
       Sec. 132(b)(1) of the FAIR Act. No change from existing law 
     except instead of referencing ``commodity'', ``loan 
     commodity'' is referenced.
       Sec. 132(b)(2) of the FAIR Act is consistent with Sec 
     162(b) of existing law. Sec. 123(b) Repeals Sec. 162(c) of 
     current law, but Sec. 171(b)(2) repeals Sec. 123(b). (Section 
     123)
       The Conference substitute provides for loan rates for the 
     2002 and 2003 crop years that are different than loan rates 
     for the 2004 through 2007 crop years for most crops.
       Loan rates for the 2002 and 2003 crop years are $2.80 per 
     bushel for wheat, $1.98 per bushel for corn, $1.98 per bushel 
     for grain sorghum, $1.88 per bushel for barley, $1.35 per 
     bushel for oats, $0.52 per pound for upland cotton, $0.7977 
     per pound for extra long staple cotton, $5.00 per bushel for 
     soybeans, $0.096 per pound for other oilseeds, and $6.50 per 
     hundredweight for rice, $6.33 per hundredweight for dry peas, 
     $11.94 per hundredweight for lentils and $7.56 per 
     hundredweight for small chickpeas.
       Loan rates for the 2004 through 2007 crop years are $2.75 
     per bushel for wheat, $1.95 per bushel for corn, $1.95 per 
     bushel for grain sorghum, $1.85 per bushel for barley, $1.33 
     per bushel for oats, $0.52 per pound for upland cotton, 
     $0.7977 per pound for extra long staple cotton, $5.00 per 
     bushel for soybeans, $0.093 per pound for other oilseeds, and 
     $6.50 per hundredweight for rice, $6.22 per hundredweight for 
     dry peas, $11.72 per hundredweight for lentils and $7.43 per 
     hundredweight for small chickpeas.
       Loan rates for the 2002 through 2007 crop years are $1.00 
     per pound for graded wool, $0.40 per pound for ungraded wool 
     and unshorn pelts and $4.20 per pound for mohair.
       Loan rate for the 2002 through 2007 crop years for honey is 
     $0.60 per pound.
       The Managers anticipate the Secretary will take advantage 
     of the change in national average loan rates to review and 
     adjust as appropriate the county loan rates.
       To the extent practicable, for purposes of making loans and 
     loan deficiency payments, the Secretary should designate loan 
     rates in those units that are consistent with the units in 
     common usage in the industry.
       It is the intention of the Committee that the provision for 
     non-graded wool be made

[[Page H1907]]

     available for wool that has not been objectively measured for 
     fiber diameter (micron) and yield. Documentation of objective 
     measurement is commonly known as a core test, which is 
     available through laboratory analysis. It is the intent of 
     the Mangers that the Secretary provide the graded wool loan 
     rate to wool that meets the terminology used by the wool 
     industry to define graded wool, such as core tested. (Section 
     1202)
     (17) Term of Loans
       The House bill provides that the term for marketing 
     assistance loans is unchanged. For all covered commodities 
     except upland cotton and extra long staple cotton, the term 
     of the loan is nine months beginning on the first day of the 
     first month after the month in which the loan is made.
       For upland cotton and extra long staple cotton, the term of 
     the loan is 10 months beginning on the first day of the month 
     in which the loan is made.
       Prohibits extension of a marketing assistance loan for a 
     covered commodity. (Section 123)
       The Senate amendment provides that the term for marketing 
     assistance loans for all commodities shall be 9 months 
     beginning on the first day of the first month after the month 
     in which the loan is made. (Section 124)
       The Conference substitute adopts the Senate provision with 
     respect to the term of loans and adopts the House provision 
     with respect to the prohibition on extension of loans. 
     (Section 1203)
     (18) Repayment of Loans
       The House bill provides repayment of marketing assistance 
     loans is unchanged. The Secretary will permit producers of 
     wheat, corn, grain sorghum, barley, oats, soybeans, and other 
     oilseeds to repay a marketing assistance loan at a rate that 
     is the lesser of the loan rate for the commodity plus 
     interest or a rate that the Secretary determines will 
     minimize forfeitures, accumulation of stocks, storage costs, 
     and allow the commodity to be marketed freely and 
     competitively.
       The Secretary will permit producers of upland cotton and 
     rice to repay a marketing assistance loan at a rate that is 
     the lesser of the loan rate for the commodity plus interest 
     or the prevailing world market price (adjusted to U.S. 
     quality and location), as determined by the Secretary.
       The Secretary will permit producers of extra long staple 
     cotton to repay a marketing assistance loan at the loan rate 
     plus interest.
       The Secretary will prescribe by regulation the formula to 
     determine the prevailing world market price and a mechanism 
     to periodically announce this price.
       The adjustment of the prevailing world market price for 
     upland cotton is unchanged.
       In the case of a producer that marketed or lost beneficial 
     interest before repaying the loan, the Secretary shall permit 
     the producer to repay the loan at the lowest repayment rate 
     that was in effect for the covered commodity under this 
     section as of the date that the producer lost beneficial 
     interest. (Section 124)
       The Senate amendment amends Section 134(a) of the FAIR Act 
     by striking the reference to wheat, corn, grain sorghum, 
     barley, oats and oilseeds and inserting ``a loan commodity 
     (other than upland cotton, rice, and extra long staple 
     cotton)'' (in effect, adding wool, honey, dry peas, lentils 
     and chickpeas to the list of commodities) and adding 
     ``minimize discrepancies in marketing loan benefits across 
     State boundaries and across county boundaries'' to the other 
     4 factors the Secretary is required to use in determining a 
     loan repayment rate.
       Amends Sec. 1001 of the Food Security Act of 1985. Sec. 
     1001(c) Limitations on marketing loan gains, loan deficiency 
     payments, and commodity certificate transactions and Sec. 
     1001(d) Settlement of certain loans may restrict the 
     eligibility of some producers to repay loans at a lower 
     repayment rate.
       Amends Sec. 134(e)(1) of the FAIR Act by authorizing the 
     program through July 31, 2007. (Section 125, 121, and 169)
       The Conference substitute permits producers of wheat, corn, 
     grain sorghum, barley, oats, soybeans, other oilseeds, dry 
     peas, lentils, small chickpeas, wool, mohair, and honey to 
     repay a marketing assistance loan at a rate that is the 
     lesser of the loan rate for the commodity plus interest or a 
     rate that the Secretary determines will minimize forfeitures, 
     accumulation of stocks, storage costs, allow the commodity to 
     be marketed freely and competitively, and minimizes 
     discrepancies in marketing loan benefits across State 
     boundaries and county boundaries.
       The Secretary will permit producers of upland cotton and 
     rice to repay a marketing assistance loan at a rate that is 
     the lesser of the loan rate for the commodity plus interest 
     or the prevailing world market price (adjusted to U.S. 
     quality and location), as determined in accordance with 
     section 163 of the FAIR Act.
       The Secretary will permit producers of extra long staple 
     cotton to repay a marketing assistance loan at the loan rate 
     plus interest as determined in accordance with section 163 of 
     the FAIR Act.
       The Secretary will prescribe by regulation the formula to 
     determine the prevailing world market price for upland cotton 
     and rice and a mechanism to periodically announce this price.
       The adjustment of the prevailing world market price for 
     upland cotton is unchanged.
       For the 2001 crop, in the case of a producer that marketed 
     or lost beneficial interest before repaying the loan, the 
     Secretary shall permit the producer to repay the loan at the 
     appropriate repayment rate that was in effect for the loan 
     commodity under as of the date that the producer lost 
     beneficial interest, if the Secretary determines the 
     producers acted in good faith.
       The Managers intend that in determining loan repayment 
     rates for loan commodities other than upland cotton and rice, 
     the Secretary will consider alternative methodologies, 
     including establishing the Posted County Prices for grains 
     and oilseeds at levels that reflect market prices at both 
     terminal markets for counties with two terminal markets. The 
     Managers expect the Secretary to determine whether assigning 
     equal weight to two terminal markets will better reflect 
     local market prices than the current system of using the 
     higher of the two terminal markets to establish the Posted 
     County Price.
       In implementing the marketing assistance loan program for 
     minor oilseeds, the Managers expect the Secretary to 
     establish a single sunflower loan rate in each county for 
     oil-type, confection and other-type sunflowers combined. 
     Managers also expect the Secretary to continue to announce 
     weekly loan repayment rates for sunflowers reflecting local 
     market prices that minimize potential loan forfeitures. 
     Accordingly, sunflower seed loan repayment rates should 
     reflect oil-type sunflower seed local market prices.
       The Conference substitute established a marketing 
     assistance loan program for pulse crops--dry peas, lentils 
     and small chickpeas. The loan rate for dry peas is based on 
     U.S. feed pea prices; the loan rate for lentils is based on 
     the price of U.S. No. 3 lentils; and the loan rate for small 
     chickpeas is based on the price of chickpeas that drop below 
     a 20/64 screen. Accordingly, the Managers expect the 
     Secretary to calculate regional pulse loan rates and 
     repayment rates based on the prices of feed peas, No. 3 
     lentils, and chickpeas that drop below a 20/64 screen. 
     (Section 1204)
     (19) Loan Deficiency Payments
       The House bill provides loan deficiency payments are 
     maintained. The Secretary will make loan deficiency payments 
     available to producers who, although eligible for a marketing 
     assistance loan, agree to forgo a loan in favor of receiving 
     a payment.
       The loan deficiency payment is determined by multiplying 
     the loan payment rate by the quantity of the covered 
     commodity produced, excluding any commodity for which the 
     producer obtained a loan.
       The loan payment rate is the amount by which the loan rate 
     exceeds the rate at which the loan may be repaid.
       Loan deficiency payments do not apply to extra long staple 
     cotton.
       The Secretary shall make a loan deficiency payment on the 
     earlier of the date the producer marketed or lost beneficial 
     interest in the commodity, or the date the producer requests 
     the payment.
       Provides for loan deficiency payments on crop year 2001 
     covered commodities on farms that do not have an AMTA 
     contract. (Section 125)
       The Senate amendment amends Sec. 135 of the FAIR Act. Makes 
     loan deficiency payments available to producers on a farm 
     that, although eligible to obtain a marketing assistance loan 
     with respect to a loan commodity, agree to forgo obtaining 
     the loan in return for payments under this section.
       Strikes subsections (e) and (f) of section 135 of the FAIR 
     Act and inserts language comparable to the House provision 
     except the provision is applicable for the 2001-2006 crops. 
     The Secretary shall make a loan deficiency payment only if 
     the producer has beneficial interest in the loan commodity as 
     of the earlier of the date on which the producers on the farm 
     marketed or otherwise lost beneficial interest in the loan 
     commodity or the date the producers on the farm request the 
     payment.
       Amends section 135(a)(2) to provide for loan deficiency 
     payments on crop year 2001 contract commodities on farms that 
     do not have a production flexibility contract. (Section 126)
       The Conference substitute provides for the continuation of 
     loan deficiency payments. The Secretary will make loan 
     deficiency payments available to producers who, although 
     eligible for a marketing assistance loan, agree to forgo a 
     loan in favor of receiving a payment.
       Unshorn pelts, hay and silage derived from a loan commodity 
     are not eligible for a marketing assistance loan, however the 
     commodities are eligible for loan deficiency payments when 
     unshorn pelts, hay or silage are derived from a loan 
     commodity.
       The loan deficiency payment is determined by multiplying 
     the payment rate by the quantity of the loan commodity 
     produced, excluding any commodity for which the producer 
     obtained a loan.
       The payment rate is the amount by which the loan rate 
     exceeds the rate at which the loan may be repaid.
       Provides that the loan deficiency payment for unshorn pelts 
     is based on the rate in effect for ungraded wool and the loan 
     deficiency payment for hay and silage is based on the loan 
     commodity from which the hay and silage is derived.
       Loan deficiency payments do not apply to extra long staple 
     cotton.
       The Secretary shall make a loan deficiency payment on the 
     date the producer requests the payment.
       Provides for loan deficiency payments on crop year 2001 
     loan commodities on farms that do not have an AMTA contract.

[[Page H1908]]

       For the 2001 crop, the Secretary shall make a loan 
     deficiency payment on the earlier of the date the producer 
     marketed or lost beneficial interest in the loan commodity, 
     or the date the producer requested the payment. (Section 
     1205)
     (20) Payments in Lieu of Loan Deficiency Payments for Grazed 
         Acreage
       The House bill provide that the Secretary will make 
     payments in lieu of loan deficiency payments for grazed 
     acreage to producers that would be eligible for such a loan 
     deficiency payment for wheat, barley, or oats but elects to 
     use the acreage planted to the crops for livestock grazing.
       To receive a payment, the producer must agree to forgo any 
     other harvesting of the commodity on that acreage.
       The payment amount is determined by multiplying the loan 
     deficiency payment rate by the payment quantity, which is 
     determined by multiplying the quantity of grazed acreage in 
     which the producer elects to forgo harvesting by the payment 
     yield.
       The time, manner, and availability of these payments are to 
     be consistent with the general loan deficiency payment and 
     marketing assistance loan provisions for wheat, barley, and 
     oats.
       Producers who receive a loan deficiency payment under this 
     section are ineligible for crop insurance or noninsured crop 
     assistance as to that acreage. (Section 126)
       The Senate amendment adds Sec. 138 to Subtitle C of the 
     FAIR Act. The Secretary will make payments in lieu of loan 
     deficiency payments for grazed acreage to producers that 
     would be eligible for such a loan deficiency payment for 
     wheat, grain sorghum, barley, or oats but who elect to use 
     the acreage planted to the crops for livestock grazing.
       To receive a payment, the producer must agree to forgo any 
     other harvesting of the commodity on that acreage.
       The payment amount is determined by multiplying the loan 
     deficiency payment rate by the payment quantity, which is 
     determined by multiplying the quantity of grazed acreage in 
     which the producer elects to forgo harvesting by the payment 
     yield.
       The time, manner, and availability of these payments are to 
     be consistent with the general loan deficiency payment and 
     marketing assistance loan provisions for wheat, grain 
     sorghum, barley, and oats.
       Producers who receive a loan deficiency payment under this 
     section are ineligible for crop insurance or noninsured crop 
     assistance as to that acreage. (Section 127)
       The Conference substitute adopts the House provision with 
     an amendment that provides payments to producers with 
     triticale for grazing when the producer agrees to forgo any 
     other harvesting of the acreage.
       For purposes of determining the loan deficiency payment to 
     be used in calculating the payment for the grazing of 
     triticale acreage only, the Managers intend for the Secretary 
     to take into account the predominate class of wheat grown in 
     the county in which the farm is located. (Section 1206)
     (21) Special Marketing Loan Provisions for Upland Cotton
       The House bill provides that the special marketing loan 
     provisions for upland cotton remain unchanged, including 
     provisions relating to cotton user marketing certificates, 
     the special import quota, and the limited global import quota 
     for upland cotton.
       Authorizes through July 31, 2012. (Section 127)
       The Senate amendment amends section 136(a) of the FAIR Act 
     by adding language that removes the 1.25-cent threshold for 
     Step-2 cotton payments beginning on the date of enactment of 
     this paragraph and ending on July 31, 2003.
       Amends Sec. 136 of the FAIR Act by authorizing program 
     through July 31, 2007. (Section 121 and 128)
       The Conference substitute adopts the House provision with 
     an amendment that accepts the Senate provision removing the 
     1.25-cent threshold for cotton Step-2 payments through July 
     31, 2006. (Section 1207)
     (22) Special Competitive Provisions for Extra Long Staple 
         Cotton
       The House bill provides that the special competitive 
     provisions for extra long staple cotton remain unchanged, 
     including provisions relating to the competitiveness program, 
     payments under the program, eligibility, and the amount and 
     form of payment. (Section 128)
       The Senate amendment amends Sec. 136(A)(a) of the FAIR Act 
     by authorizing the program through July 31, 2007. (Section 
     121)
       The Conference substitute adopts the House provisions 
     through July 31, 2008. (Section 1208)
     (23) Availability of Recourse Loans for High Moisture Feed 
         Grains and Seed Cotton and other Fibers
       The House bill provides that the availability of recourse 
     loans for high moisture feed grains and seed cotton remains 
     unchanged. Authority under the FAIR Act to provide this 
     assistance for the 2002 crop year is terminated. (Section 
     129)
       The Senate amendment amends Sec. 137 of the FAIR Act by 
     authorizing the loans through the 2006 crops. Otherwise 
     retains current law. (Section 121)
       The Conference substitute adopts the House provision with 
     an amendment that provides that a loan under this subsection 
     shall be made on a quantity of acquired grain determined by 
     multiplying the acreage in a high moisture state on the farm 
     by the lower of the farm program payment yield used for 
     counter-cyclical payments under subtitle A or the actual 
     yield on a field, as determined by the Secretary. (Section 
     1209)
     (24) Availability of Nonrecourse Marketing Assistance Loans 
         for Wool and Mohair
       The House bill provides that the Secretary will make 
     nonrecourse marketing assistance loans available to producers 
     of wool and mohair for the 2002 through 2011 marketing years.
       The graded wool loan rate is not more than $1.00 per pound. 
     The non-graded wool loan rate is not more than $0.40 per 
     pound. The mohair loan rate is not more than $4.20 per pound.
       The term of the loan is one year beginning on the first day 
     of the first month after the month in which the loan is made.
       Producers may repay the loan at a rate that is the lesser 
     of the loan rate established for the commodity plus interest 
     or at a rate that the Secretary determines will 
     minimize forfeitures, accumulation of stocks, storage 
     costs, and that allows the commodity to be marketed freely 
     and competitively.
       Loan deficiency payments are also authorized to those 
     producers who agree to forgo obtaining a loan.
       The loan payment rate shall be the amount by which the loan 
     rate in effect for the commodity exceeds the rate at which a 
     loan may be repaid.
       The Secretary shall make a loan deficiency payment on the 
     earlier of the date the producer marketed or lost beneficial 
     interest in the commodity or the date the producer requests 
     the payment.
       The marketing loan gains and loan deficiency payment a 
     producer may receive under the wool and mohair program is 
     subject to a separate but equal payment limitation than other 
     covered commodities receiving marketing loan benefits. 
     (Section 130)
       The Senate amendment amends Sec. 132 of the FAIR Act. Loan 
     rates are $1.00 per pound for graded wool, $0.40 per pound 
     for nongraded wool and unshorn pelts. The Senate amendment 
     contains no provisions for mohair.
       Amends Sec. 133 of the FAIR Act to establish a 9-month loan 
     term for all loan commodities.
       Amends Sec. 134(a) of the FAIR Act to provide loan 
     repayment rate criteria for wool and other loan commodities. 
     (Section 123, 124 and 125)
       The Conference substitute accepts the House provisions with 
     an amendment that adds unshorn pelts as a commodity eligible 
     for a loan deficiency payment. In addition, all marketing 
     loan and loan deficiency provisions for wool and mohair are 
     integrated into the same sections in subtitle B as for other 
     loan commodities.
     (25) Availability of Nonrecourse Marketing Assistance Loans 
         for Honey
       The House bill provides that the Secretary will make 
     nonrecourse marketing assistance loans available to producers 
     of honey for the 2002 through 2011 marketing years.
       The honey loan rate shall be equal to $0.60 per pound.
       The term of the loan is one year beginning on the first day 
     of the first month after the month in which the loan is made.
       Producers may repay the loan at a rate that is the lesser 
     of the loan rate established for the commodity plus interest 
     or at the prevailing domestic market price for honey.
       Loan deficiency payments are also authorized to those 
     producers who agree to forgo obtaining a loan.
       The loan payment rate shall be the amount by which the loan 
     rate in effect for the commodity exceeds the rate at which a 
     loan may be repaid.
       The Secretary shall make a loan deficiency payment on the 
     earlier of the date the producer marketed or lost beneficial 
     interest in the commodity or the date the producer requests 
     the payment.
       The marketing loan gains and loan deficiency payment a 
     producer may receive under the honey program is subject to a 
     separate but equal payment limitation than other covered 
     commodities receiving marketing loan benefits.
       This section shall be carried out in a manner as to 
     minimize forfeitures of honey. (Section 131)
       The Senate amendment amends Sec. 132 of the FAIR Act. Loan 
     rate is $0.60 per pound.
       Amends Sec. 133 of the FAIR Act to establish a 9-month loan 
     term for all loan commodities.
       Amends Sec. 134(a) of the FAIR Act to provide loan 
     repayment rate criteria for honey and other loan commodities. 
     (Section 123, 124, and 125)
       The Conference substitute accepts the House provisions with 
     an amendment that includes honey in the same marketing loan 
     and loan deficiency sections as for other loan commodities in 
     subtitle B.
     (26) Availability of Nonrecourse Marketing Assistance Loans 
         for Dry Peas, Lentils and Chickpeas
       The Senate amendment amends Sec. 132 of the FAIR Act. Loan 
     rate for dry peas is $6.78 per hundredweight, loan rate for 
     lentils is $12.79 per hundredweight, loan rate for large 
     chickpeas is $17.44 per hundredweight, and loan rate for 
     small chickpeas is $8.10 per hundredweight.
       Amends Sec. 133 of the FAIR Act to establish a 9-month loan 
     term for all loan commodities.
       Amends Sec. 134(a) of the FAIR Act to provide loan 
     repayment rate criteria for dry

[[Page H1909]]

     peas, lentils, chickpeas and other loan commodities. (Section 
     123, 124, and 125)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that provides a loan rate for the 2002 and 2003 
     crop years at $7.56 per hundredweight for small chickpeas, 
     $11.94 per hundredweight for lentils and $6.33 per 
     hundredweight for dry peas.
       Provides a loan rate for the 2004 through 2007 crop years 
     at $7.43 per hundredweight for small chickpeas, $11.72 per 
     hundredweight for lentils and $6.22 per hundredweight for dry 
     peas. (Section 1202)
     (27) Producer Retention of Erroneously Paid Loan Deficiency 
         Payments and Marketing Loan Gains
       The House bill provides that neither the Secretary nor CCC 
     shall require producers in Erie County, Pennsylvania, to 
     repay 1998 and 1999 loan deficiency payments and marketing 
     loan gains erroneously paid or determined to have been 
     earned. In the case of a producer who has already made 
     repayment, CCC shall reimburse the producer the full amount 
     of the repayment. (Section 132)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 1618)


                     Subtitle C--Other Commodities

                            Chapter 1--Dairy

     (28) Milk Price Support Program
       The House bill provides that the Milk Price Support Program 
     is authorized through December 31, 2011 at a rate of $9.90/
     cwt on a 3.67% milk fat basis. The Secretary is authorized to 
     purchase butter, nonfat dry milk powder or cheese at 
     established prices in order to maintain the $9.90/cwt support 
     price. The purchase prices for butter and nonfat dry milk 
     powder may be allocated so as to minimize expenditures from 
     the Commodity Credit Corporation. The Secretary may modify 
     purchase prices for butter and nonfat dry milk not more than 
     2 times per year. (Section 141)
       The Senate amendment amends the Federal Agriculture 
     Improvement and Reform Act of 1996 extending the price 
     support program through December 31, 2006. It also retains 
     provisions of the 1996 Act to provide that at the program's 
     termination, it shall be considered to have expired 
     notwithstanding section 257 (relating to the baseline) of the 
     Balanced Budget and Emergency Deficit Control Act of 1985 (2 
     U.S.C. 907). (Section 131)
       The Conference substitute adopts the House provision 
     (including an enduring budgetary baseline) with an amendment 
     providing for the program's operation through December 31, 
     2007.
     (29) Repeal of Recourse Loan Program For Processors
       The House bill provides that the Recourse Loan Program for 
     Processors (7 U.S.C. 7252) is repealed (Section 142)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision. P.L. 
     107-76 repealed the Recourse Loan Program.
     (30) Extension of Dairy Export Incentive and Dairy Indemnity 
         Programs
       The House bill provides that the Dairy Export Incentive 
     Program (15 U.S.C. 713a-14(a)) is extended through 2011. The 
     Dairy Indemnity Program (7 U.S.C. 4501) is extended through 
     2011. (Section 143)
       The Senate amendment extends the Dairy Export Incentive 
     Program and the Dairy Indemnity Program through 2006. 
     (Section 133)
       The Conference substitute adopts the House provision with 
     an amendment to extend both programs through 2007.
     (31) Fluid Milk Promotion
       The House bill provides that the Fluid Milk Processor 
     Promotion Program (7 U.S.C. 6402) is amended to repeal the 
     termination of authority, and to make technical changes to 
     the definitions of ``Fluid Milk Product'' and ``Fluid Milk 
     Processor.'' (Section 144)
       The Senate amendment is similar with technical amendments 
     within the definition of fluid milk processor regarding 
     exclusion for products delivered directly to the place of 
     residence of a consumer. (Section 134)
       The Conference substitute adopts the Senate provision.
     (32) Dairy Product Mandatory Reporting
       The House bill provides that the Dairy Product Mandatory 
     Reporting (7 U.S.C. 1637a(1)) is amended to make technical 
     corrections regarding products to be reported. (Section 145)
       The Senate amendment is similar with technical amendments 
     regarding the definition of manufactured dairy products. 
     (Section 135)
       The Conference substitute adopts the Senate provision.
       The managers want to ensure the enforcement of federal 
     standards of identity that apply for fluid milk products 
     purchased by the federal government for distribution in all 
     federally supported feeding and nutrition programs. If the 
     Secretary of Health and Human Services determines that the 
     federal standards are not being enforced, the Secretary is 
     urged to develop and implement procedures for the enforcement 
     of federal standards of identity for fluid milk products 
     purchased by the federal government within 1 year of 
     enactment of this legislation.
     (33) Funding of Dairy Promotion and Research Program
       The House bill provides that the Dairy Promotion Program (7 
     U.S.C. 4502) is amended to require dairy importers to pay an 
     assessment equivalent to domestic dairy producers. Importers 
     would be eligible to vote in referenda and would have 
     representation on the National Dairy Promotion and Research 
     Board. (Section 146)
       The Senate amendment is the same (Section 136)
       The Conference substitute adopts the House provision with 
     amendments to authorize the Secretary of Agriculture to 
     reapportion the representation levels of domestic producers 
     and importers to reflect a proportion of domestic production 
     and imports supplying the United States market; to make clear 
     that assessments from importers will not be used for foreign 
     export promotion purposes; to clarify when the importer must 
     pay the assessment; to make clear that the domestic milk rate 
     shall be applied to imports on a milk-equivalent basis; to 
     make clear that national dairy promotion program and order 
     must promote milk and dairy products without regard to 
     origin; and to require that in implementing an order under 
     this section, the Secretary consults with the United States 
     Trade Representative in order to ensure consistency with the 
     international trade obligations of the United States.
       The Conferees note that since 1990, the provisions of 7 
     U.S.C. 2278 have been in effect and apply generally to 
     research and promotion programs administered by the 
     Department of Agriculture. Those provisions require that the 
     Secretary consult with the U.S. Trade Representative when 
     research and promotion orders are modified or implemented to 
     apply to imported products, and take steps to ensure that 
     international trade obligations are met. The Conferees intend 
     that the similar provision included specifically in the 
     conference substitute with respect to assessments on imports 
     for the dairy promotion program not be regarded as being in 
     conflict with current law.
     (34) Study of National Dairy Policy and Studies of Effects of 
         Changes in Approach to National Dairy Policy and Fluid 
         Milk Identity Standards
       The House bill requires the Secretary of Agriculture to 
     conduct an economic analysis of various options for a 
     National Dairy Program and report to Congress not later than 
     April 30, 2002. (Section 147)
       The Senate amendment requires studies of the effects of 
     terminating all Federal dairy programs and establishing 
     regional compacts, and a study of the effects of establishing 
     minimum protein standards to be reported to Congress not 
     later than September 30, 2002. (Section 137)
       The Conference substitute adopts the both the House and 
     Senate provisions with an amendment to require that each 
     report be issued one year after the date of enactment of this 
     Act.
     (35) National Dairy Program
       The Senate amendment creates a national dairy support 
     program with two components. The National Dairy Market Loss 
     Assistance Program is authorized from December 1, 2001, 
     through September 30, 2005. The program covers producers in 
     states not included in the Northeast Dairy Market Loss 
     Payment program. Payment is calculated by taking 40% of 
     the difference between the all-milk price and the 
     historical five-year average multiplied by eligible 
     production. Eligible production is based on taking the 
     lesser of (A) the average quantity of milk marketed for 
     commercial use in which the producer has had a direct or 
     indirect interest during each of the 1999 through 2001 
     fiscal years, (B) 8,000,000 pounds, or (C) actual 
     production for the time period. The program is capped at 
     $1.5 billion.
       The Northeast Dairy Market Loss Payment program is 
     authorized from December 1, 2001 through September 30, 2005. 
     The program covers the states of Connecticut, Delaware, 
     Maine, Maryland, Massachusetts, New Hampshire, New Jersey, 
     New York, Pennsylvania, Rhode Island, Vermont, and West 
     Virginia. Payment is based on a target price of $16.94. 
     Eligible production is based on the lesser of (A) the average 
     quantity of milk marketed for commercial use in which the 
     producer had a direct or indirect interest during each of the 
     1999 through 2001 fiscal years, (B) 8,000,000 pounds, or (C) 
     actual production for the time period. The program is capped 
     at $500 million. (Section 132)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision to 
     create a single national program using the payment formula 
     established under the proposed Northeast Dairy Market Loss 
     Assistance Program. Under this program, participating dairy 
     producers will receive monthly payments equal to 45 percent 
     of the difference between $16.94 and the price per 
     hundredweight of Class I fluid milk in Boston under the 
     applicable federal milk marketing order. No payments will be 
     made for months during which the fluid milk price in Boston 
     is $16.94 or higher. Payments will be made not later than 60 
     days after the end of the month for which a payment is made. 
     Producers, on an operation-by-operation basis, may receive 
     payments on no more than 2.4 million pounds of milk marketed 
     per year. Retroactive payments will be made covering market 
     losses due to low prices since December 1, 2001. The program 
     is authorized through September 30, 2005.
       The Managers understand that previous Dairy Market Loss 
     Assistance Programs provided discretion to the Secretary to 
     limit payments to individual dairy operations. It

[[Page H1910]]

     is the intent of the Managers that this program shall be 
     administered in the same manner, thereby limiting payments on 
     an operation-by-operation basis. Accordingly, a producer 
     might qualify for separate limits on separate operations.
       The managers intend that in carrying out this section, the 
     Secretary utilize information available through the 
     Agricultural Marketing Service monthly milk marketing's by 
     producers.

                            Chapter 2--Sugar

     (36) Sugar Program
       The House bill subsection (a) reauthorizes the sugar 
     program through the 2011 crop year.
       Subsection (b) terminates the marketing assessment on sugar 
     effective October 1, 2001.
       Subsection (c) provides the Secretary of Agriculture the 
     discretion to reduce loan rates for U.S. sugar producers in 
     the event that support for foreign competitors is reduced 
     beyond that required under the Agreement on Agriculture.
       Subsection (d) ensures that notification requirements do 
     not frustrate the purposes of the nonrecourse loan program.
       Subsection (e) authorizes nonrecourse loans on in-process 
     sugars.
       Subsection (f) requires the Secretary of Agriculture to 
     administer the sugar program at no net cost to the federal 
     government to the maximum extent practicable. The subsection 
     also authorizes the CCC to accept bids from processors for 
     the purchase of sugar inventory in exchange for reduced 
     production.
       Subsection (g) establishes reporting guidelines for 
     producers and importers relative to yields and acreage 
     planted and amounts imported. Requires reporting by sugar 
     cane producers in proportionate share states.
       Subsection (h) makes section 163 of the FAIR Act 
     inapplicable to sugar. (Section 151)
       The Senate amendment subsection (i) reauthorizes the sugar 
     program through the 2006 crop year.
       Subsection (c) terminates the marketing assessment on sugar 
     effective October 1, 2001.
       Subsection (a) provides the Secretary of Agriculture the 
     discretion to reduce loan rates for U.S. sugar producers in 
     the event that support for foreign competitors is reduced 
     beyond that required under the Agreement on Agriculture.
       Paragraph (2) of subsection (b) ensures that notification 
     requirements do not frustrate the purposes of the nonrecourse 
     loan program.
       Subsection (e) authorizes nonrecourse loans on in-process 
     sugars.
       Subsection (f) requires the Secretary of Agriculture to 
     administer the sugar program at no net cost to the federal 
     government to the maximum extent practicable and subject to 
     subsection (e)(3) (which bars the Secretary from imposing pre 
     notification requirements as a condition to forfeiture). The 
     subsection also authorizes the CCC to accept bids from 
     processors for the purchase of sugar inventory in exchange 
     for reduced production.
       Subsection (g) establishes reporting guidelines for 
     producers and importers relative to yields and acreage 
     planted and amounts imported. Loan assistance is conditioned 
     on reporting by sugar cane producers located in proportionate 
     share states.
       Subsection (j) makes section 163 of the FAIR Act 
     inapplicable to sugar.
       Subsection(b)(1) modifies provisions to assure that loan 
     benefits are passed through to producers by allowing beet 
     producers to contract minimum payments and by providing for 
     the use of CCC funds to compensate producers in the event of 
     bankruptcy or insolvency of the processor.
       Subsection (h) allows substitutability of all refined sugar 
     for re-export. (Section 141)
       The Conference substitute adopts the Senate sugar 
     provisions, with technical and clarifying amendments, except 
     that the provision providing for the use of CCC funds to 
     compensate producers in the event of processor bankruptcy or 
     insolvency is excluded.
     (37) Reauthorize Provisions of Agricultural Adjustment Act of 
         1938 Regarding Sugar
       The House bill subsection (a) repeals repetitive reporting 
     provisions.
       Subsection (b) requires the Secretary to establish 
     marketing allotments for domestically grown sugar to 
     eliminate forfeitures through 2011.
       Subsection (c) updates the allotment formula to take into 
     account current U.S. import obligations. The subsection also 
     assigns allotments between sugarcane and sugar beets. Finally 
     the subsection authorizes the Secretary to suspend 
     allotments whenever imports exceed a certain level.
       Subsection (d) updates the base periods and other factors 
     applicable to the allocation of sugarcane and sugar beet 
     allotments among sugarcane and sugar beet processors, 
     respectively.
       Subsection (e) establishes procedures for the Secretary to 
     reassign allotments if a processor cannot meet the 
     allocation.
       Subsection (f) prescribes the manner in which allotment 
     disputes are settled and provides for certain adjustments in 
     the event a processor closes.
       Subsection (g) allows the Secretary to preserve certain 
     acreage base history for a longer period and also defines the 
     term ``offshore states''.
       Subsection (h) lifts the suspension on allotments for the 
     2002 crop. (Section 152)
       The Senate amendment subsection (a) repeals repetitive 
     reporting provisions.
       Subsection (b) requires the Secretary to establish 
     marketing allotments for domestically grown sugar to 
     eliminate forfeitures through 2006.
       Subsection (c) updates the allotment formula to take into 
     account current U.S. import obligations. The subsection also 
     assigns allotments between sugarcane and sugar beets. Finally 
     the subsection authorizes the Secretary to suspend allotments 
     whenever imports exceed a certain level.
       Subsection (d) updates the base periods and other factors 
     applicable to the allocation of sugarcane and sugar beet 
     allotments among sugarcane and sugar beet processors, 
     respectively. Adds provisions for new entrant states. 
     Provides formula for beet sugar allocation.
       Subsection (e) establishes procedures for the Secretary to 
     reassign allotments if a processor cannot meet the 
     allocation.
       Subsection (f) prescribes the manner in which allotment 
     disputes are settled and provides for certain adjustments in 
     the event a processor closes.
       Subsection (g) allows the Secretary to preserve certain 
     acreage base history for a longer period and also defines the 
     term ``offshore states''.
       Sec. 165(2)(A) strikes the suspension of price support 
     authority for sugar. (Section 143)
       The Conference substitute adopts the Senate sugar 
     provisions, with technical and clarifying amendments.
       Subsections (b)(1)(D) and (b)(2)(C) of section 359(e) of 
     the Agricultural Adjustment Act of 1938, as amended by 
     section 1403 of the conference agreement, provide for the 
     reassignment of unused marketing allotments for cane sugar 
     and beet sugar, respectively to imports of sugar under 
     certain specified conditions. It is the intent of the 
     conferees that in the event that any allotments are 
     reassigned to imports, the appropriate agency shall 
     accommodate the allotted imports by increasing the tariff-
     rate quota for sugar in an amount equal to the total amount 
     of the allotments reassigned to imports. By doing so, the 
     market balance sought by the allotment system should be 
     maintained and will not result in a reduction in the overall 
     allotment quantity, a suspension of the allotments, or any 
     increase in the prospect of the forfeiture of domestically 
     produced sugar to the Commodity Credit Corporation.
     (38) Storage Facility Loans
       The House bill subsection (a) requires the CCC to amend the 
     Code of Federal Regulations to establish a sugar storage 
     facility loan program. Subsection (b) requires the CCC to 
     make such loans to processors of domestically produced sugar 
     that have satisfactory credit history, that need increased 
     storage, and that demonstrate an ability to repay the loan. 
     Subsection (c) provides for a 7-year term for the loan. 
     Subsection (d) requires the program be administered using the 
     services, facilities, and funds of the CCC. (Section 153)
       The Senate amendment subsection (a) requires the CCC to 
     amend the Code of Federal Regulations to establish a sugar 
     storage facility loan program. Subsection (b) requires the 
     CCC to make such loans to processors of domestically produced 
     sugar that have satisfactory credit history, that need 
     increased storage, and that demonstrate an ability to repay 
     the loan. Subsection (c) provides for a 7-year term for the 
     loan. (Section 142)
       The Conference substitute adopts the Senate provision.
     (39) Reallocation of Sugar Quota
       The Senate amendment requires the U.S. Trade Representative 
     in consultation with the Secretary, by June 1 of each year, 
     to determine the amount of the quota of cane sugar used by 
     each qualified supplying country for that country for that 
     fiscal year. The Trade Representative may reallocate the 
     unused quota. (Section 144)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate amendment with 
     technical amendments.

                           Chapter 3--Peanuts

     (40) Definitions
       The House bill defines terms necessary for implementation 
     of this act, including counter-cyclical payment, effective 
     price, historic peanut producer, fixed, decoupled payment, 
     payment acres, peanut acres, payment yield, peanut producer, 
     Secretary, State, target price, and United States. (Section 
     161)
       The Senate amendment defines terms necessary for 
     implementation of this act, including counter-cyclical 
     payment, direct payment, effective price, historical peanut 
     producers on a farm, income protection price, payment acres, 
     peanut acres, payment yield, and peanut producer. (Section 
     151)
       The Conference substitute adopts the House provision with 
     an amendment that clarifies the definition of ``producer'', 
     changes the term ``peanut acres'' to ``base acres for 
     peanuts'', changes the term ``fixed, decoupled payment'' to 
     ``direct payment'', and provides 2002 transitional payment 
     language under the term ``payment acres''. (Section 1301)
     (41) Establishment of Payment Yield, Peanut Acres, and 
         Payment Acres for a Farm.
       The House bill provides that the Secretary shall determine, 
     for each historic peanut producer, the average yield for 
     peanuts on each farm on which the historic peanut producer 
     produced peanuts for the 1998 through 2001 crops years, 
     excluding any crop year in which the producer did not produce 
     peanuts.

[[Page H1911]]

       If, for any of these four crop years in which peanuts were 
     planted on a farm by the producer, the farm would have 
     satisfied the eligibility criteria established to carry out 
     section 1102 of the Agriculture, Rural Development, Food and 
     Drug Administration, and Related Agencies Appropriations Act 
     1999, the Secretary shall assign a yield for the producer 
     for that year equal to 65 percent of the county yield, as 
     determined by the Secretary. (Section 162)
       The Secretary shall determine, for each historic peanut 
     producer, the four-year average of acreage actually planted 
     in peanuts by the historic peanut producer for harvest on one 
     or more farms during crop years 1998, 1999, 2000, and 2001 
     and any acreage that the producer was prevented from planting 
     to peanuts during such crops years because of drought, flood 
     or other natural disaster, or other condition beyond the 
     control of the producer, as determined by the Secretary.
       If more than one historic peanut producer shared in the 
     risk of producing the crop on the farm, the historic peanut 
     producers shall receive their proportional share of the 
     number of acres planted (or prevented from being planted) to 
     peanuts for harvest on the farm based on the sharing 
     arrangement that was in effect among the producers for the 
     crop.
       The Secretary shall make the determinations required by 
     this subsection not later than 90 days after the date of the 
     enactment of this Act. In making such determinations, the 
     Secretary shall take into account changes in the number and 
     identity of persons sharing in the risk of producing a peanut 
     crop since the 1998 crop year, including providing a method 
     for the assignment of average acres and average yield to a 
     farm when the historic peanut producer is no longer living or 
     an entity composed of historic peanut producers has been 
     dissolved.
       The Secretary shall give each historic peanut producer an 
     opportunity to assign the average peanut yield and average 
     acreage determined under subsection (a) for the producer to 
     cropland on a farm.
       The average of all of the yields assigned by historic 
     peanut producers to a farm shall be deemed to be the payment 
     yield for that farm for the purpose of making fixed, 
     decoupled payments and counter-cyclical payments under this 
     chapter.
       Subject to subsection (e), the total number of acres 
     assigned by historic peanut producers to a farm shall be 
     deemed to be the peanut acres for a farm for the purpose of 
     making fixed, decoupled payments and counter-cyclical 
     payments under this chapter.
       The opportunity to make the assignments described in 
     subsection (b) shall be available to historic peanut 
     producers only once. The historic peanut producers shall 
     notify the Secretary of the assignments made by such 
     producers under such subsections not later than 180 days 
     after the date of the enactment of this Act.
       The payment acres for peanuts on a farm shall be equal to 
     85 percent of the peanut acres assigned to the farm.
       If the sum of the peanut acres for a farm, together with 
     the base acres for the farm under subtitle A, any acreage on 
     the farm enrolled in the conservation reserve program or 
     wetlands reserve program, and any other acreage on the farm 
     enrolled in a conservation program for which payments are 
     made in exchange for not producing an agricultural commodity 
     on the acreage, exceeds the actual cropland acreage of the 
     farm, the Secretary shall reduce the quantity of peanut acres 
     for the farm or base acres for one of more covered 
     commodities for the farm as necessary so that sum of peanut 
     acres and other covered acreage does not exceed the actual 
     cropland acreage of the farm. The Secretary shall give the 
     peanut producers on the farm the opportunity to select the 
     peanut acres or base acres against which the reduction will 
     be made.
       In applying paragraph (1), the Secretary shall make an 
     exception in the case of double cropping as determined by the 
     Secretary (Section 162)
       The Senate amendment provides that the Secretary shall 
     determine, for each historical peanut producer, the average 
     yield for peanuts on all farms of the historical peanut 
     producer for the 1998 through 2001 crop years, excluding any 
     crop year during which the producers did not produce peanuts.
       If, for any of the crop years in which peanuts were planted 
     on a farm by the historical peanut producer, the historical 
     peanut producer has satisfied the eligibility criteria 
     established to carry out section 1102 of the Agriculture, 
     Rural Development, Food and Drug Administration, and Related 
     Agencies Appropriations Act, 1999, the Secretary shall assign 
     to the historical peanut producer a yield for the farm for 
     the crop year equal to 65 percent of the average yield for 
     peanuts for the previous 5 crop years.
       Except as provided in paragraph (3), the Secretary shall 
     determine, for the historical peanut producer, the 4-year 
     average of acreage planted to peanuts on all farms for 
     harvest during the 1998 through 2001 crop years, and any 
     acreage that was prevented from being planted to peanuts 
     during the crop years because of drought, flood or other 
     natural disaster, or other condition beyond the control of 
     the historical peanut producer, as determined by the 
     Secretary.
       If a county in which a historical peanut producer is 
     located is declared a disaster area during 1 or more of the 
     four crop years, for purposes of determining the 4-year 
     average acreage for the historical peanut producer, the 
     historical peanut producer may elect to substitute, for not 
     more than 1 year of the crop years during which a disaster is 
     declared (A) the State average of acreage actually planted to 
     peanuts; or (B) the average of acreage for the historical 
     peanut producer determined by the Secretary under paragraph 
     (2)
       The Secretary shall make the determinations required by 
     this subsection not later than 90 days after the date of 
     enactment of this section. In making the determinations, the 
     Secretary shall take into account changes in the number and 
     identity of historical peanut producers sharing in the risk 
     of producing a peanut crop since the 1998 crop year, 
     including providing a method for the assignment of average 
     acres and average yield to a farm when a historical peanut 
     producer is no longer living or an entity composed of 
     historical peanut producers has been dissolved.
       The Secretary shall provide each historical peanut producer 
     with an opportunity to assign the average peanut yield and 
     average acreage determined under subsection (a) for the 
     historical peanut producer to cropland on a farm
       The average of all of the yields assigned by historical 
     peanut producers to a farm shall be considered to be the 
     payment yield for the farm for the purpose of making direct 
     payments and counter-cyclical payments under this chapter.
       Subject to subsection (e), the total number of acres 
     assigned by historical peanut producers to a farm shall be 
     considered to be the peanut acres for the farm for the 
     purpose of making direct payments and counter-cyclical 
     payments under this chapter
       Not later than 180 days after the date of enactment of this 
     section, a historical peanut producer shall notify the 
     Secretary of the assignments described in subsection (b).
       The payment acres for peanuts on a farm shall be equal to 
     85 percent of the peanut acres assigned to the farm.
       If the total of the peanut acres for a farm, together with 
     the contract acreage for the farm under subtitle B, any 
     acreage on the farm enrolled in the conservation 
     reserve program or wetlands reserve program, and any other 
     acreage on the farm enrolled in a conservation program for 
     which payments are made in exchange for not producing an 
     agriculture commodity on the acreage, exceeds the actual 
     cropland acreage of the farm, the Secretary shall reduce 
     the quantity of peanut acres for the farm or contract 
     acreage for one or more covered commodities for the farm 
     as necessary so that the total of the peanut acres and 
     other covered acreage does not exceed the actual cropland 
     acreage of the farm. The Secretary shall give the peanut 
     producers on the farm the opportunity to select the peanut 
     acres or contact acreage against which the reduction will 
     be made.
       In applying paragraph (1), the Secretary shall take into 
     account additional acreage as a result of an established 
     double-cropping history on a farm, as determined by the 
     Secretary. (Section 151)
       The Conference substitute adopts the House provision with 
     an amendment. The amendment allows the historic peanut 
     producer to elect to substitute for a farm, for not more than 
     3 of the 1998 through 2001 crop years in which the producer 
     planted peanuts on the farm, the average yield for peanuts 
     produced in the county in which the farm is located for the 
     1990 through 1997 crop years.
       The amendment requires the historic peanut producer to 
     assign average base acreage and average yield to a farm by 
     March 31, 2003. In addition, the amendment sets a series of 
     criteria that a historic peanut producer must meet for them 
     to assign average base acreage and average yield across state 
     lines. The Secretary shall provide notice to historic peanut 
     producers regarding their opportunity to assign average 
     peanut yields and average acreages to farms. The amendment 
     states that the notice shall include: notice that the 
     opportunity to make the assignments is being provided once, a 
     description of the limitation of assigning average acres and 
     average yields across state lines, and information regarding 
     the manner in which the assignments must be made and the time 
     periods and manner in which the notice of the assignments 
     must be submitted to the Secretary.
       The amendment further states the Secretary shall provide 
     for an adjustment in the base acres for peanuts for a farm 
     whenever a conservation reserve contract with respect to the 
     farm expires or is voluntarily terminated, or the Secretary 
     releases cropland from coverage under a conservation reserve 
     contract. Also included is a provision to allow the owner of 
     a farm to reduce at any time the base acres for peanuts 
     assigned to the farm. (Section 1302)
       The Managers are aware that AMTA contract acreage was not 
     protected on acreage enrolled into CRP during CRP signups 15 
     and later. The Managers intend that the Secretary develop a 
     method that provides for the restoration of base acreage on 
     farms that permanently reduced contract acreage because of 
     enrollment in CRP. Since soybeans and other oilseeds did not 
     have contract acreage prior to this Act, the Managers expect 
     the Secretary to treat soybeans and other oilseeds in a 
     manner that is similar and consistent with other covered 
     commodities. (Section 1302)
     (42) Availability of Fixed, Decoupled Payments for Peanuts
       The House bill provides that for each of the 2002 through 
     2011 crop years, the Secretary shall make fixed, decoupled 
     payments to peanut producers on a farm. The payment

[[Page H1912]]

     rate used to make fixed, decoupled payments with respect to 
     peanuts for a crop year shall be equal to $36 per ton.
       The amount of the fixed, decoupled payment to be paid to 
     the peanut producers on a farm for a covered commodity for a 
     crop year shall be equal to the product of the payment rate, 
     the payment acres and the payment yield.
       Fixed, decoupled payments shall be paid not later than 
     September 30 of each of the fiscal years 2002 through 2011. 
     In the case of the 2002 crop, payments may begin to be made 
     on or after December 1, 2001.
       At the option of a peanut producer, 50 percent of the 
     fixed, decoupled payment for a fiscal year shall be paid on a 
     date selected by the peanut producer. The selected date shall 
     be on or after December 1 of that fiscal year, and the peanut 
     producer may change the selected date for a subsequent fiscal 
     year by providing advance notice to the Secretary.
       If a peanut producer that receives an advance fixed, 
     decoupled payment for a fiscal year ceases to be a peanut 
     producer before the date the fixed, decoupled payment would 
     otherwise have been made by the Secretary, the peanut 
     producer shall be responsible for repaying the Secretary the 
     full amount of the advance payment. (Section 163)
       The Senate amendment provides that for each of the 2002 
     through 2006 fiscal years, the Secretary shall make direct 
     payments to peanut producers on a farm with peanut acres 
     under section 158B and a payment yield for peanuts under 
     section 158B. The payment rate used to make direct payments 
     with respect to peanuts for a fiscal year shall be equal to 
     $0.018 per pound.
       The amount of the direct payment to be paid to the peanut 
     producers on a farm for peanuts for a fiscal year shall be 
     equal to the product obtained by multiplying the payment 
     rate, the payment acres, and the payment yield.
       The Secretary shall make direct payments in the case of the 
     2002 fiscal year, during the period beginning December 1, 
     2001, and ending September 30, 2002; and in the case of each 
     of the 2003 through 2006 fiscal years, not later than 
     September 30 of the fiscal year.
       At the option of the peanut producers on a farm, the 
     Secretary shall pay 50 percent of the direct payment for a 
     fiscal year for the producers on the farm on a date selected 
     by the peanut producers on the farm. The selected date for a 
     fiscal year shall be on or after December 1 of the fiscal 
     year. The peanut producers on a farm may change the selected 
     date for a subsequent fiscal year by providing advance notice 
     to the Secretary.
       If any peanut producer on a farm that receives an advance 
     direct payment for a fiscal year ceases to be eligible for a 
     direct payment before the date the direct payment would have 
     been made by the Secretary, the peanut producer shall be 
     responsible for repaying the Secretary the full amount of the 
     advance payment. (Section 151)
       The Conference substitute adopts the House provision with 
     an amendment to clarify payment rules for the 2002 crop year 
     by directing the Secretary to make direct payments to 
     historic peanut producers for the 2002 crop year. For each of 
     the 2003 through 2007 crop years for peanuts, the Secretary 
     shall make direct payments to the producers on a farm to 
     which a payment yield and base acres for peanuts are assigned 
     under section 1302.
       The payment rate used to make direct payments with respect 
     to peanuts for a crop year shall be equal to $36 per ton. 
     (Section 1303)
     (43) Availability of Counter-Cyclical Payment for Peanuts
       The House bill provides that during the 2002 through 2011 
     crop years for peanuts, the Secretary shall make counter-
     cyclical payments with respect to peanuts whenever the 
     Secretary determines that the effective price for peanuts is 
     less than the target price.
       The effective price for peanuts is equal to the sum of 
     higher of either (A) the national average market price 
     received by peanut producers during the 12-month marketing 
     year for peanuts, as determined by the Secretary; or (B) the 
     national average loan rate for a marketing assistance loan 
     for peanuts in effect for the same period under this chapter; 
     and the payment rate in effect under section 163 for the 
     purpose of making fixed, decoupled payments.
       The target price for peanuts is $480 per ton.
       The payment rate for counter-cyclical payments is equal to 
     the difference between the target price for peanuts and the 
     effective price for the peanuts.
       The amount of the counter-cyclical payment to be paid to 
     the peanut producers on a farm for a crop year shall be equal 
     to the product of the payment rate, the payment acres, by the 
     payment yield.
       The Secretary shall make counter-cyclical payments for a 
     peanut crop as soon as possible after determining that such 
     payments are required for that crop year.
       The Secretary may permit, and, if so permitted, a peanut 
     producer may elect to receive, up to 40 percent of the 
     projected counter-cyclical payment, as determined by the 
     Secretary, to be made under this section for a peanut crop 
     upon completion of the first six months of the marketing year 
     for that crop. The peanut producer shall repay the Secretary 
     the amount, if any, by which the partial payment exceeds the 
     actual counter-cyclical payment to be made for that crop. 
     (Section 164)
       The Senate amendment provides for each of the 2002 through 
     2006 crops of peanuts, the Secretary shall make counter-
     cyclical payments with respect to peanuts if the Secretary 
     determines that the effective price for peanuts is less than 
     the income protection price for peanuts.
       The effective price for peanuts is equal to the total of 
     the greater of either (A) the national average market price 
     received by peanut producers during the 12-month marketing 
     year for peanuts or (B) the national average loan rate for a 
     marketing assistance loan for peanuts under section 158G in 
     effect for the 12-month marketing year for peanuts under this 
     chapter; and the payment rate in effect for peanuts under 
     section 158C for the purpose of making direct payments with 
     respect to peanuts.
       The income protection price for peanuts is $520 per ton.
       The amount of the counter-cyclical payment to be paid to 
     the peanut producers on a farm for a crop year shall be equal 
     to the product obtained by multiplying the payment rate, the 
     payment acres, by the payment yield.
       The payment rate used to make counter-cyclical payments 
     with respect to peanuts for a crop year shall be equal to the 
     difference between the income protection price for peanuts 
     and the effective price for peanuts.
       The Secretary shall make counter-cyclical payments to 
     peanut producers on a farm under this section for a crop of 
     peanuts as soon as practicable after determining under 
     subsection (a) that the payments are required for the crop 
     year.
       At the option of the Secretary, the peanut producers on a 
     farm may elect to receive up to 40 percent of the projected 
     counter-cyclical payment to be made under this section for a 
     crop of peanuts on completion of the first six months of the 
     marketing year for the crop. The peanut producers on a farm 
     shall repay to the Secretary the amount, if any, by which the 
     payment received by producers on the farm (including partial 
     payments) exceeds the counter-cyclical payment the producers 
     on the farm are eligible for under this section. (Section 
     151)
       The Conference substitute adopts the Senate provision with 
     an amendment to clarify payment rules for the 2002 crop year 
     by directing the Secretary to make counter-cyclical payments 
     to historic peanut producers for the 2002 crop year. For each 
     of the 2003 through 2007 crop years for peanuts, the 
     Secretary shall make counter-cyclical payments to the 
     producers on a farm to which a payment yield and base acres 
     for peanuts are assigned under section 1302.
       The amendment changes the effective price definition to 
     state the effective price for peanuts is equal to the sum of 
     the higher of (a) the national average market price for 
     peanuts received by producers during the 12-month marketing 
     year for peanuts or (b) the national average loan rate for a 
     marketing assistance loan for peanuts in effect for the 
     applicable period under this subtitle; plus the payment rate 
     in effect under section 1303 for the purpose of making direct 
     payments.
       If before the end of the 12-month marketing year, the 
     Secretary estimates that counter-cyclical payments will be 
     required under this section for a crop year, the Secretary 
     shall give producers on a farm (or, in the case of the 2002 
     crop year, historic peanut producers) the option to receive 
     partial payments of the counter-cyclical payment projected to 
     be made for that crop.
       When the Secretary makes partial payments for any of the 
     2002 through 2006 crop years the first partial payment for 
     the crop year shall be made not earlier than October 1, and, 
     to the maximum extent practicable, not later than October 31, 
     of the calendar year in which the crop is harvested; the 
     second partial payment shall be made not earlier than 
     February 1 of the next calendar year; and the final payment 
     shall be made as soon as practicable after the end of the 12-
     month marketing year for that crop.
       When the Secretary makes partial payments available for the 
     2007 crop year the first partial payment shall be made after 
     completion of the first 6 months of the marketing year for 
     that crop; and the final partial payment shall be made as 
     soon as practicable after the end of the 12-month marketing 
     year for that crop.
       In the case of the 2002 crop year, the first partial 
     payment to an historic peanut producer may not exceed 35 
     percent of the projected counter-cyclical payment for the 
     crop year, as determined by the Secretary. The second partial 
     payment may not exceed the difference between 70 percent of 
     the revised projection of the counter-cyclical payment for 
     the 2002 crop year and the amount of the first partial 
     payment. The final payment shall be equal to the difference 
     between the actual counter-cyclical payment to be made to the 
     historic peanut producer and the amount of the partial 
     payment already made to the historic peanut producers under 
     clauses (i) and (ii).
       For each of the 2003 through 2006 crop years, the first 
     partial payment to the producers on a farm may not exceed 35 
     percent of the projected counter-cyclical payment for the 
     crop year, as determined by the Secretary. The second partial 
     payment may not exceed the difference between 70 percent of 
     the revised projection of the counter-cyclical payment for 
     the 2002 crop year and the amount of the first partial 
     payment. The final payment shall be equal to the difference 
     between the actual counter-cyclical payment to be made to the 
     producers for that crop year and the amount of the partial 
     payment already made to the producers under clauses (i) and 
     (ii) for that crop year.

[[Page H1913]]

       For the 2007 crop year, the first partial payment to the 
     producers on a farm may not exceed 40 percent of the 
     projected counter-cyclical payment for that crop year, as 
     determined by the Secretary. The final payment for the 2007 
     crop year shall be equal to the difference between the actual 
     counter-cyclical payment to be made to the producers for that 
     crop year and the amount of the partial payment made to the 
     producers under clause (i).
       The producers on a farm (or, in the case of the 2002 crop 
     year, historic peanut producers) must repay the amount, if 
     any, by which the partial payment exceeds the counter-
     cyclical payment to be made in that crop year. (Section 1304)
       The target price for peanuts shall be equal to $495 per 
     ton. (Section 1304)
     (44) Producer Agreement Required As Condition On Provision of 
         Fixed, Decoupled Payments and Counter-Cyclical Payments
       The House bill provides that before the peanut producers on 
     a farm may receive fixed, decoupled payments or counter-
     cyclical payments with respect to the farm, the peanut 
     producers shall agree, in exchange for the payments to comply 
     with applicable conservation and wetland protection 
     requirements, to comply with the planting flexibility 
     requirements, and to use the land on the farm, in an amount 
     equal to the peanut acres for an agriculture or conserving 
     use.
       The Secretary may issue such rules as the Secretary 
     considers necessary to ensure peanut producer compliance with 
     the requirements of paragraph (1).
       A peanut producer may not be required to make repayments to 
     the Secretary of fixed, decoupled payments and counter-
     cyclical payments if the farm has been foreclosed on and the 
     Secretary determines that the forgiving the repayments is 
     appropriate to provide fair and equitable treatment.
       This subsection shall not void the responsibilities of the 
     peanut producer under subsection (a) if the peanut producer 
     continues or resumes operation or control of the farm.
       On the resumption of operation or control over the farm by 
     the producer, the requirements of subsection (a) in effect on 
     the date of foreclosure shall apply.
       Except as provided in paragraph (4), a transfer or change 
     in the interest of a peanut producer in peanut acres for 
     which fixed, decoupled payments or counter-cyclical payments 
     are made shall result in the termination of the payments with 
     respect to the peanut acres, unless the transferee or owner 
     of the acreage agrees to assume all obligations under 
     subsection (a). The termination shall be effective on the 
     date of the transfer or change.
       There is no restriction on the transfer of a farm's peanut 
     acres or payment yield as part of a change in the peanut 
     producers on the farm.
       At the request of the transferee or owner, the Secretary 
     may modify the requirements of subsection (a) if the 
     modifications are consistent with the objectives of such 
     subsection, as determined by the Secretary.
       If a peanut producer entitled to a fixed, decoupled payment 
     or counter-cyclical payment dies, becomes incompetent, or is 
     otherwise unable to receive payment, the Secretary shall make 
     the payment, in accordance with regulations prescribed by the 
     Secretary.
       As a condition on the receipt of any benefits under this 
     chapter, the Secretary shall require peanut producers to 
     submit to the Secretary acreage reports.
       In carrying out this chapter, the Secretary shall provide 
     adequate safeguards to protect the interests of tenants and 
     sharecroppers.
       The Secretary shall provide for the sharing of fixed, 
     decoupled payments and counter-cyclical payments among the 
     peanut producers on a farm on a fair and equitable basis. 
     (Section 165)
       The Senate amendment provide that before the peanut 
     producers on a farm may receive direct payments or counter 
     cyclical payments with respect to the farm, the peanut 
     producers on the farm shall agree during the fiscal year or 
     crop year, respectively, for which the payments are received, 
     in exchange for payments to comply with applicable highly 
     erodible land conservation requirements, to comply with 
     applicable wetland conservation requirements, to comply with 
     planting flexibility requirements, and to agree to use a 
     quantity of the land on the farm equal to peanut acres for an 
     agriculture or conserving use.
       The Secretary may promulgate such regulations as the 
     Secretary considers necessary to ensure peanut producer 
     compliance with paragraph (1).
       The Secretary shall not require the peanut producers on a 
     farm to repay a direct payment or counter-cyclical payment if 
     a foreclosure has occurred with respect to the farm and the 
     Secretary determines that forgiving the repayment is 
     appropriate to provide fair and equitable treatment.
       This subsection shall not void the responsibilities of the 
     peanut producers on a farm under subsection (a), if the 
     peanut producers on the farm continue or resume operation, or 
     control, of the farm.
       On the resumption of operation or control over the farm by 
     the peanut producers on the farm, the requirements of 
     subsection (a) in effect on the date of the foreclosure shall 
     apply.
       Except as provided in paragraph (5), a transfer of or 
     change in the interest of the peanut producers on a farm in 
     peanut acres for which direct payments or counter-cyclical 
     payments are made shall result in the termination of the 
     payments with respect to the peanut acres, unless the 
     transferee or owner of the acreage agrees to assume all 
     obligations under subsection (a). The termination takes 
     effect on the date of the transfer or change.
       The Secretary shall not impose any restrictions on the 
     transfer of the peanut acres or payment yield of a farm as 
     part of a transfer or change described in paragraph (1).
       At the request of the transferee or owner, the Secretary 
     may modify the requirements of subsection (a) if the 
     modifications are consistent with the purposes of subsection 
     (a), as determined by the Secretary.
       If a peanut producer entitled to a direct payment or 
     counter-cyclical payment dies, becomes incompetent, or is 
     otherwise unable to receive the payment, the Secretary shall 
     make the payment, in accordance with regulations promulgated 
     by the Secretary.
       As a condition on the receipt of any benefits under this 
     chapter, the Secretary shall require the peanut producers on 
     a farm to submit to the Secretary acreage reports for the 
     farm.
       In carrying out this chapter, the Secretary shall provide 
     adequate safeguards to protect the interests of tenants and 
     sharecroppers.
       The Secretary shall provide for the sharing of direct 
     payments and counter-cyclical payments among the peanut 
     producers on a farm on a fair and equitable basis. (Section 
     151)
       The Conference substitute provides that before producers on 
     a farm may receive direct payments or counter-cyclical 
     payments with respect to the farm, the producers shall agree, 
     in exchange for the payments to comply with applicable 
     conservation requirements, applicable wetland protection 
     requirements, planting flexibility requirements, to use the 
     land on the farm in a quantity attributable to the base acres 
     for an agricultural or conserving use and not for a 
     nonagricultural commercial or industrial use, as determined 
     by the Secretary and on noncultivated land attributable to 
     the base acres, control noxious weeds and otherwise maintain 
     the land in accordance with sound agricultural practices.
       The Secretary may issue rules to ensure compliance with 
     these requirements.
       At the request of the transferee or owner, the Secretary 
     may modify the requirements of this subsection if the 
     modifications are consistent with the objectives of such 
     subsection, as determined by the Secretary.
       A transfer of (or change in) the interest of a producer in 
     base acres for which direct or counter-cyclical payments are 
     made shall result in the termination of the payments with 
     respect to bases acres, unless the transferee or owner of the 
     acreage agrees to assume all obligations under conservation, 
     wetland, planting flexibility, agriculture land use 
     provisions and controlling noxious weeds provisions. The 
     termination shall take effect on the date determined by the 
     Secretary.
       If a producer entitled to a direct payment or counter-
     cyclical payment dies, becomes incompetent, or is otherwise 
     unable to receive the payment, the Secretary shall make the 
     payment, in accordance with regulations prescribed by the 
     Secretary.
       A producer who receives direct payments, counter-cyclical 
     payments, or marketing loan benefits is required to submit 
     annual acreage reports with respect to all cropland on the 
     farm to the Secretary.
       The Secretary shall provide adequate safeguards to protect 
     the interests of tenants and sharecroppers.
       The Secretary shall provide for the sharing of direct 
     payments and counter-cyclical payments among the producers on 
     a farm on a fair and equitable basis.
       When there is a transfer (or change in) the interest of a 
     producer in base acres for which direct or counter-cyclical 
     payments are made, the Managers intend for the Secretary to 
     provide a time frame for the succession to occur that is 
     farmer-friendly.
       Acreage reports provide important information such as 
     assisting in determining the eligibility of land to be 
     accepted into the Conservation Reserve Program. The Managers 
     are aware that in prior years, the Secretary has imposed 
     penalties on producers that submit acreage reports that the 
     Secretary later determines to be inaccurate. The Managers 
     understand that under prior acreage limiting and acreage 
     reduction programs there was a need for very accurate 
     reporting. However, under this Act, with the exception of 
     determining the amount of fruits, vegetables, and wild rice 
     planted on base acreage, there is no such need or requirement 
     for the level of accuracy. Therefore, under this provision 
     the Managers do not intend for any penalty to be applicable 
     to inaccurate acreage reports on covered commodities or 
     peanuts, provided the producer has made a good faith effort 
     to accurately report acreage. (Section 1305)
     (45) Planting Flexibility
       The House bill provides that generally, producers may plant 
     any commodity on the peanut acres of a farm, except fruits 
     and vegetables (other than lentils, mung beans, and dry 
     peas), and wild rice.
       Paragraph (1) shall not limit the planting of an 
     agriculture commodity in (A) any region in which there is a 
     history of double-cropping of peanuts with agriculture 
     commodities specified in paragraph (1), as determined by the 
     Secretary, in which case the double-cropping shall be 
     permitted; (B) on a farm that the Secretary determines has a 
     history of planting agriculture commodities specified in 
     paragraph (1) on peanut acres, except that fixed, decoupled 
     payments and

[[Page H1914]]

     counter-cyclical payments shall be reduced by an acre for 
     each acre planted to such an agriculture commodity; or (C) by 
     a peanut producer who the Secretary determines has an 
     established planting history of a specific agriculture 
     commodity specified in paragraph (1), except that the 
     quantity planted may not exceed the peanut producer's average 
     annual planting history of such agriculture commodity in the 
     1991 through 1995 crop years (excluding any crop year in 
     which no plantings were made); and fixed decoupled payments 
     and counter-cyclical payments shall be reduced by an acre for 
     each acre planted to such agriculture commodity. (Section 
     166)
       The Senate amendment provides that generally, producers may 
     plant any commodity on the peanut acres of a farm, except 
     fruits and vegetables (other than lentils, mung beans, and 
     dry peas), and in the case of the 2003 and subsequent crops 
     of an agriculture commodity, wild rice.
       Paragraph (1) shall not limit the planting of an 
     agriculture commodity in (A) any region in which there is a 
     history of double-cropping of peanuts with agriculture 
     commodities specified in paragraph (1), as determined by the 
     Secretary, in which case the double-cropping shall be 
     permitted; (B) on a farm that the Secretary determines has a 
     history of planting agriculture commodities specified in 
     paragraph (1) on peanut acres, except that direct payments 
     and counter-cyclical payments shall be reduced by an acre for 
     each acre planted to the agriculture commodity; or (C) by the 
     peanut producers on a farm that the Secretary determines has 
     an established planting history of a specific agriculture 
     commodity specified in paragraph (1), except that the 
     quantity planted may not exceed the average annual planting 
     history of the agricultural commodity by the peanut producers 
     on the farm during the 1996 through 2001 crop years 
     (excluding any crop year in which no plantings were made), as 
     determined by the Secretary and direct payments and counter-
     cyclical payments shall be reduced by an acre for each acre 
     planted to the agriculture commodity. (Section 151)
       The Conference substitute adopts the House provision with 
     an amendment that provides that the planting of fruits, 
     vegetables (other than lentils, mung beans and dry peas) and 
     wild rice shall be prohibited on base acreage unless the 
     commodity, if planted, is destroyed before harvest.
       The planting of fruits and vegetables produced on trees and 
     other perennials shall be prohibited on base acres.
       The Secretary shall establish a producer planting history 
     for fruits, vegetables and wild rice planted by the producers 
     on the farm in the 1991 through 1995 or 1998 through 2001 
     crop years. (Section 1306)
     (46) Marketing Assistance Loans and Loan Deficiency Payments 
         for Peanuts
       The House bill provides that for each of the 2002 through 
     2011 crop of peanuts, the Secretary shall make available to 
     peanut producers on a farm non-recourse marketing assistance 
     loans for peanuts produced on the farm. Any production of 
     peanuts on a farm shall be eligible for a marketing 
     assistance loan.
       In carrying out this subsection, the Secretary shall make 
     loans to a peanut producer that is otherwise eligible to 
     obtain a marketing assistance loan, but for the fact the 
     peanuts owned by the peanut producer are commingled with 
     other peanuts in facilities unlicensed for the storage of 
     agricultural commodities by the Secretary or a State 
     licensing authority, if the peanut producer obtaining the 
     loan agrees to immediately redeem the loan collateral in 
     accordance with section 166 of the Federal Improvement and 
     Reform Act of 1996.
       A marketing assistance loan and loan deficiency payments 
     may be obtained at the option of the peanut producer through 
     a designated marketing association of peanut producers that 
     is approved by the Secretary; or the Farm Service Agency.
       The loan rate for a marketing assistance loan for peanuts 
     shall be equal to $350 per ton.
       A marketing assistance loan for peanuts under subsection 
     (a) shall have a term of nine months beginning on the first 
     day of the first month after the month in which the loan is 
     made. The Secretary may not extend the term of a marketing 
     assistance loan under subsection (a).
       The Secretary shall permit producers to repay a marketing 
     assistance loan for peanuts at a rate that is the lesser of 
     the loan rate for the commodity plus interest; or a rate that 
     the Secretary determines will minimize loan forfeitures, 
     accumulation of stocks, storage costs, and allow peanuts 
     produced in the United States to be marketed freely and 
     competitively.
       The Secretary may make loan deficiency payments available 
     to peanut producers who, although eligible to obtain a 
     marketing assistance loan for peanuts, agree to forgo 
     obtaining the loan for the peanuts in return for payments.
       A loan deficiency payment shall be computed by multiplying 
     the loan payment rate and the quantity of the peanuts 
     produced by the peanut producers, excluding any quantity for 
     which the producers obtain a loan under subsection (a).
       The loan payment rate shall be the amount by which the loan 
     rate exceeds the rate at which a loan may be repaid.
       The Secretary shall make a payment under this subsection to 
     a peanut producer with respect to a quantity of peanuts as of 
     the earlier of (A) the date on which the peanut producer 
     marketed or otherwise lost beneficial interest in the peanuts 
     or (B) the date the peanut producer requests the payment.
       As a condition of the receipt of a marketing assistance 
     loan, the peanut producer shall comply with applicable 
     conservation and wetland protection requirements, during the 
     term of the loan.
       To the extent practicable, the Secretary shall implement 
     any reimbursable agreements or provide for the payment of 
     expenses under this chapter in a manner that is consistent 
     with such activities in regard to other commodities.
       This section terminates section 155 of the Federal 
     Agriculture Improvement and Reform Act of 1996, which 
     provided superseded price support authority. (Section 166)
       The Senate amendment provides that for each of the 2002 
     through 2006 crops of peanuts, the Secretary shall make 
     available to peanut producers on a farm non-recourse 
     marketing assistance loans for peanuts produced on the farm. 
     The producers on a farm shall be eligible for a marketing 
     assistance loan under this section for any quantity of 
     peanuts produced on the farm.
       In carrying out this section, the Secretary shall make 
     loans to peanut producers on a farm that would be eligible to 
     obtain a marketing assistance loan, but for the fact the 
     peanuts owned by the peanut producers on the farm are 
     commingled with other peanuts of other producers in 
     facilities unlicensed for the storage of agricultural 
     commodities by the Secretary or a State licensing authority, 
     if the peanut producers on a farm obtaining the loan agree to 
     immediately redeem the loan collateral in accordance with 
     section 158E.
       A marketing assistance loan and loan deficiency payments 
     may be obtained at the option of the peanut producers on a 
     farm through (A) a designated marketing association of peanut 
     producers that is approved by the Secretary, (B) the Farm 
     Service Agency, or (C) a loan servicing agent approved by the 
     Secretary.
       The loan rate for a marketing assistance loan for peanuts 
     shall be equal to $400 per ton.
       A marketing assistance loan for peanuts under subsection 
     (a) shall have a term of nine months beginning on the first 
     day of the first month after the month in which the loan is 
     made. The Secretary may not extend the term of a marketing 
     assistance loan for peanuts under subsection (a).
       The Secretary shall permit peanut producers on a farm to 
     repay a marketing assistance loan for peanuts at a rate that 
     is the lesser of the loan rate for peanuts plus interest or a 
     rate that the Secretary determines will minimize forfeitures, 
     accumulation of stocks, storage costs; and allow peanuts 
     produced in the United States to be marketed freely and 
     competitively.
       The Secretary may make loan deficiency payments available 
     to the peanut producers on a farm that, although eligible to 
     obtain a marketing assistance loan for peanuts under 
     subsection (a), agree to forgo obtaining the loan for the 
     peanuts in return for payments under this subsection.
       A loan deficiency payment shall be obtained by multiplying 
     the loan payment rate by the quantity of the peanuts produced 
     by the peanut producers on the farm, excluding any quantity 
     for which the producers on a farm obtain a loan under 
     subsection (a).
       The loan payment rate shall be the amount by which the loan 
     rate exceeds the rate at which a loan may be repaid.
       The Secretary shall make a payment under this subsection to 
     the peanut producers on a farm with respect to a quantity of 
     peanuts as of the earlier of (A) the date on which the peanut 
     producers on the farm marketed or otherwise lost beneficial 
     interest in the peanuts, as determined by the Secretary or 
     (B) the date the peanut producers on the farm request the 
     payment.
       As a condition of the receipt of a marketing assistance 
     loan under subsection (a), the peanut producers on a farm 
     shall comply during the term of the loan with applicable 
     conservation and wetland protection requirements.
       To the maximum extent practicable, the Secretary shall 
     implement any reimbursable agreements or provide for the 
     payment of expenses under this chapter in a manner that is 
     consistent with the implementation of the agreements or 
     payment of the expenses for other commodities.
       This section terminates Section 155 of the Federal 
     Agriculture Improvement and Reform Act of 1996 is repealed. 
     (Section 151)
       The Conference substitute adopts the House provision with 
     an amendment modifying the options the producer has for 
     obtaining a marketing assistance loan and loan deficiency 
     payments to not only include a designated marketing 
     association and the Farm Service Agency, but also a marketing 
     cooperative of producers.
       Effective for the 2002 through 2006 crop of peanuts, to 
     ensure proper storage of peanuts for which a loan is made 
     under this section, the Secretary shall use the funds of the 
     Commodity Credit Corporation to pay storage, handling, and 
     other associated costs. This authority terminates beginning 
     with the 2007 crop of peanuts. Also included is 
     nondiscriminatory language for individuals or entities 
     seeking approval to store peanuts for which a marketing loan 
     is made.
       The amendment added language that a marketing association 
     or cooperative may market peanuts for which a loan is made 
     under this section in any manner that conforms to consumer 
     needs, including the separation of peanuts by type and 
     quality.

[[Page H1915]]

       The amendment added language on good faith exemptions to 
     the beneficial interest requirement for the 2002 crop of 
     peanuts. In the case of the producers on a farm that marketed 
     or otherwise lost beneficial interest in the peanuts for 
     which a marketing assistance loan was made under this section 
     before repaying the loan, the Secretary shall permit the 
     producers to repay the loan at the appropriate repayment rate 
     that was in effect for peanuts under this subsection as of 
     the date that the producers lost beneficial interest, as 
     determined by the Secretary, if the Secretary determines the 
     producers acted in good faith.
       The amendment establishes a special rule for the 2002 crop 
     year loan deficiency payments. For the 2002 crop year only, 
     the Secretary shall determine the amount of the loan 
     deficiency payment to be made to the producers on a farm with 
     respect to a quantity of peanuts using the payment rate for 
     peanuts as of the earlier of the following: the date on which 
     the producers marketed or otherwise lost beneficial interest 
     in the crop, as determined by the Secretary, or the date the 
     producers request the payment.
       The loan rate for a marketing assistance loan for peanuts 
     shall be equal to $355 per ton. (Section 1307)
       The Managers encourage the Department to continue its 
     traditional practice of accounting for all commingled peanuts 
     such that all peanuts stored commingled with peanuts covered 
     by a marketing assistance loan are graded and exchanged on a 
     dollar value basis unless it is the determination of the 
     Secretary that the beneficial interest in peanuts covered by 
     the marketing assistance loan have been transferred to other 
     parties prior to demand for delivery.
     (47) Quality Improvement
       The House bill peanuts placed under a marketing assistance 
     loan under section 167 shall be officially inspected and 
     graded by Federal or State inspectors. Peanuts not placed 
     under a marketing assistance loan may be graded at the option 
     of the producer.
       This section terminates the Peanut Administrative Committee 
     and the Secretary is directed to establish a Peanut Standards 
     Board for the purpose of assisting in the establishment of 
     quality standards for peanuts. The authority of the Board is 
     limited to assisting in the establishment of quality 
     standards for peanuts. The members of the Board should fairly 
     reflect all regions and segments of the peanut industry.
       This section shall take effect with the 2002 crop of 
     peanuts. (Section 168)
       The Senate amendment provides that all peanuts placed under 
     a marketing assistance loan under section 158G shall be 
     officially inspected and graded by a Federal or State 
     inspector. Peanuts not placed under a marketing assistance 
     loan may be graded at the option of the peanut producers on a 
     farm.
       The Senate amendment provides that this section terminates 
     the Peanut Administrative Committee. The Secretary shall 
     establish a Peanut Standards Board for the purpose of 
     assisting in the establishment of quality standards with 
     respect to peanuts. The Secretary shall appoint members to 
     the Board that, to the maximum extent practicable, reflect 
     all regions and segments of the peanut industry. The Board 
     shall assist the Secretary in establishing quality standards 
     for peanuts.
       This section shall apply beginning with the 2002 crop of 
     peanuts. (Section 151)
       The Conference substitute adopts the Senate provision with 
     an amendment requiring all peanuts marketed in the United 
     States to be officially inspected and graded by Federal or 
     Federal-State inspectors.
       The amendment clarifies the composition of the Peanut 
     Standards Board, the terms for members, and provides language 
     to transition from the Peanut Administrative Committee to the 
     Peanut Standards Board. (Section 1308)
       It is the Managers' intention that the definition of 
     ``peanut industry representatives'' includes, but is not 
     limited to, representatives of the manufacturers, shellers, 
     buying points, marketing associations and marketing 
     cooperatives.
       The Managers expect the Secretary, when developing 
     inspection and grading standards, to encourage the use of the 
     latest technology and evaluation systems to eliminate costs 
     and increase efficiency in the inspection and grading 
     process. The Secretary should also encourage the use of the 
     latest research and technology to assist in the elimination 
     and prevention of aflatoxin.
     (48) Payment Limitations
       The House bill provides that separate payment limitations 
     shall apply to peanuts with respect to fixed, decoupled 
     payments, counter-cyclical payments, and limitations on 
     marketing loan gains and loan deficiency payments.
       The Senate amendment contains no comparable provision in 
     Chapter 3.
       The Conference substitute provides the total direct and 
     counter-cyclical payments to a person for corn, grain 
     sorghum, barley, oats, wheat, soybeans, minor oilseeds, 
     cotton and rice may not exceed $40,000 and $65,000, 
     respectively. The total marketing loan gains and loan 
     deficiency payments for corn, grain sorghum, barley, oats, 
     wheat, soybeans, minor oilseeds, cotton, rice, lentils, dry 
     peas and small chickpeas that a person is entitled to receive 
     is $75,000.
       Provides for a separate direct and counter-cyclical payment 
     limitation for peanuts of $40,000 and $65,000, respectively. 
     Provides for a separate marketing loan gain and loan 
     deficiency payments limitation for peanuts, wool, mohair and 
     honey of $75,000.
       Retains current rules on husband and wife, 3-entities, 
     actively engaged and generic certificates.
       Adopts the $2.5 million adjusted gross income means test.
       The Conference substitute refers to levels of adjusted 
     gross income or comparable measures of income. The Managers 
     intend that the comparable measure provision be utilized when 
     necessary and in cases of applicants for whom, because of 
     their status under the Internal Revenue Code, adjusted gross 
     income is not measured or reported. For example, participants 
     who are organized as C Corporations, S Corporations, or as 
     nonprofit organizations, the Managers intend for the 
     Secretary to use this direction to adopt alternative 
     income measurements that compare most closely to adjusted 
     gross income. (Section 1309)
       The Managers expect the Secretary to implement this 
     provision in a manner that provides equitable treatment, to 
     the maximum extent practicable to all producers regardless of 
     the legal structure of their farming operation.
       For purposes of subsection (b), the Managers expect the 
     Secretary to determine the individual or entity to be 
     ineligible only if the adjusted gross income or similar 
     equivalent exceeds $2.5 million and less than 75 percent of 
     the adjusted gross income is derived from farming, ranching 
     or forestry operations as determined by the Secretary.
     (49) Termination of Marketing Quota Programs for Peanuts and 
         Compensation to Peanut Quota Holders for Loss of Quota 
         Asset Value
       The House bill repeals the marketing quota for peanuts, 
     part VI of subtitle B of title III of the Agricultural 
     Adjustment Act of 1938.
       The marketing quota as in effect the day before the date of 
     enactment of this Act, shall continue to apply with respect 
     to the 2001 crop of peanuts.
       The Secretary shall offer to enter into a contract with 
     eligible peanut quota holders for the purpose of providing 
     compensation for the lost value of the quota on account of 
     the repeal of the marketing quota program for peanuts. Under 
     the contracts, the Secretary shall make payments to eligible 
     peanut quota holders during fiscal years 2002 through 2006. 
     The payments required under the contracts shall be provided 
     in five equal installments not later than September 30 of 
     each of the fiscal years 2002 through 2006.
       The amount of the payment for a fiscal year to a peanut 
     quota holder under a contract shall be equal to the product 
     obtained by multiplying $0.10 per pound by the actual farm 
     poundage quota (excluding seed and experimental peanuts) 
     established for the peanut quota holder's farm for the 2001 
     marketing year.
       The provisions of section 8(g) of the Soil Conservation and 
     Domestic Allotment Act, relating to the assignment of 
     payments, shall apply to the payments made to peanut quota 
     holders under the contracts. The peanut quota holder making 
     the assignment or the assignee, shall provide the Secretary 
     with notice, in such a manner as the Secretary may require, 
     of any assignment made under this subsection.
       This section defines peanut quota holder as a person or 
     enterprise that owns a farm that was eligible, immediately 
     before the date of the enactment of this Act, to have a 
     peanut quota established upon it; if there are not quotas 
     currently established, would be eligible to have a quota 
     established upon it for the succeeding crop year; or is 
     otherwise a farm that was eligible for such a quota at the 
     time the general quota establishment authority was repealed.
       The Secretary shall apply this definition without regard to 
     temporary leases or transfers or quotas for seed or 
     experimental purposes. (Section 170)
       The Senate amendment provides the effective beginning with 
     the 2002 crop of peanuts, part VI of subtitle B of title III 
     of the Agriculture Adjustment Act of 1938 is repealed.
       This section and the amendments made by this section apply 
     beginning with the 2002 crop of peanuts.
       The Secretary shall offer to enter into a contract with 
     peanut quota holders for the purpose of providing 
     compensation for the lost value of quota as a result of the 
     repeal of the marketing quota program for peanuts. Under a 
     contract, the Secretary shall make payments to an eligible 
     peanut quota holder for each of fiscal years 2002 through 
     2006. The payments required under the contracts shall be 
     provided in 5 equal installments not later than September 30 
     of each of the fiscal years 2002 through 2006.
       The amount of the payment for a fiscal year to a peanut 
     quota holder under contract shall be equal to the product 
     obtained by multiplying $0.11 by the actual farm poundage 
     quota (excluding any quantity for seed and experimental 
     peanuts) established for the farm of a peanut quota holder 
     for the 2001 marketing year.
       The provisions of section 8(g) of the Soil Conservation and 
     Domestic Allotment Act, relating to assignment of payments, 
     shall apply to the payments made to peanut quota holders 
     under the contracts. The peanut quota holder making the 
     assignment, or the assignee, shall provide the Secretary with 
     notice, in such a manner as the Secretary may require, of any 
     assignment made under this subsection.
       This section defines peanut quota holder as a person or 
     entity that owns a farm that (I)

[[Page H1916]]

     held a peanut quota established for the farm for the 2001 
     crop of peanuts; (II) if there was not such a quota 
     established for the farm for the 2001 crop of peanuts, would 
     be eligible to have such a quota established for the farm for 
     the 2002 crop of peanuts; (III) is otherwise a farm that was 
     eligible for such a quota as of the effective date of the 
     amendments made by this section.
       The Secretary shall apply the definition of peanut quota 
     holder without regard to temporary leases, transfers, or 
     quotas for seed or experimental purposes. (Section 152)
       The Conference substitute adopts the House provision with 
     clarifying language to the quota holder definition. The quota 
     compensation payment shall be $0.11 per year for a total of 
     five years. The amendment gives an option to eligible peanut 
     quota holders entitled to payments under a contract to 
     receive the entire payment in a single lump sum.
       The amendment adds disposal language to allow the Secretary 
     to ensure that the disposal of peanuts for which a loan for 
     the 2001 crop was made is carried out in a manner that 
     prevents price disruptions in the domestic and international 
     markets for peanuts.
       The amendment adds language on the effect of termination on 
     crop insurance policies. The subsection shall apply for the 
     2002 crop year only notwithstanding any other provision of 
     law or crop insurance policy. The nonquota price election for 
     segregation I, II, and III shall be 17.75 cents per pound and 
     shall be used for all aspects of the policy relating to the 
     calculations of premium, liability, and indemnities. For the 
     purposes of quality adjustment only, the average support 
     price per pound of peanuts shall be a price equal to 17.75 
     cents per pound. Quality under the crop insurance policy for 
     peanuts shall be adjusted under procedures issued by the 
     Federal Crop Insurance Corporation. (Section 1310)


                       Subtitle D--Administration

     (50) Administration Generally
       The House bill provides that:
       (a) Use of Commodity Credit Corporation.--The Secretary 
     shall carry out this title through the Commodity Credit 
     Corporation.
       (b) Determinations by Secretary.--A determination made by 
     the Secretary under this title shall be final and conclusive.
       (c) Regulations.--Not later than 90 days after the date of 
     the enactment of this Act, the Secretary and the Commodity 
     Credit Corporation, as appropriate, shall issue such 
     regulations as are necessary to implement this title. The 
     issuance of the regulations shall be made without regard to--
       (1) the notice and comment provisions of section 553 of 
     title 5, United States Code;
       (2) the Statement of Policy of the Secretary of Agriculture 
     effective July 24, 1971 (36 Fed. Reg. 13804) relating to 
     notices of proposed rulemaking and public participation in 
     rulemaking, and
       (3) chapter 35 of title 44, United States Code (commonly 
     known as the ``Paperwork Reduction Act'').
       (d) Protection of Producers.--The protection afforded 
     producers that elect the option to accelerate the receipt of 
     any payment under a production flexibility contract payable 
     under the Federal Agriculture Improvement and Reform Act of 
     1996 (7 U.S.C. 7212 note) shall also apply to the advance 
     payment of fixed, decoupled payments and counter-cyclical 
     payments.
       (e) Adjustment Authority Related to Uruguay Round 
     Compliance.--If the Secretary determines that expenditures 
     under subtitles A, B, and C that are subject to the total 
     allowable domestic support levels under the Uruguay Round 
     Agreements (as defined in section 2(7) of the Uruguay Round 
     Agreements Act (19 U.S.C. 3501(7))), as in effect on the date 
     of the enactment of this Act, will exceed such allowable 
     levels for any applicable reporting period, the Secretary may 
     make adjustments in the amount of such expenditures during 
     that period to ensure that such expenditures do not exceed, 
     but in no case are less than, such allowable levels. (Section 
     181)
       The Senate amendment provides that:
       (a) In General.--The Secretary of Agriculture may 
     promulgate such regulations as are necessary to implement 
     this Act and the amendments made by this Act.
       (b) Procedure.--The promulgation of the regulations and 
     administration of title I and sections 456 and 508 and the 
     amendments made by title I and sections 456 and 508 shall be 
     made without regard to--
       (1) the notice and comment provisions of section 553 of 
     title 5, United States Code;
       (2) the Statement of Policy of the Secretary of Agriculture 
     effective July 24, 1971 (36 Fed. Reg. 13804), relating to 
     notices of proposed rulemaking and public participation in 
     rulemaking; and (3) chapter 35 of title 44, United States 
     Code (commonly known as the ''Paperwork Reduction Act'').
       (c) Congressional Review of Agency Rule-Making.--In 
     carrying out subsection (b), the Secretary shall use the 
     authority provided under section 808 of title 5, United 
     States Code.
       Amends Section 161 of the FAIR Act to allow the Secretary 
     to adjust the amount of domestic support to assure compliance 
     with Uruguay Round obligations.
       Requires the Secretary to report to Congress of intent to 
     make adjustment and allows adjustment unless a joint 
     resolution disapproving the adjustments is enacted by both 
     Houses of Congress within 60 days.
       Requires annual reports on domestic support by April 30 of 
     each year. (Section 164 and 1099)
       The Conference substitute adopts the House provision with 
     an amendment that provides for the Secretary, to the maximum 
     extent practicable, make adjustments in the amount of such 
     expenditures during that period to ensure that such 
     expenditures do not exceed such allowable levels.
       Before making any adjustment, the Secretary shall submit to 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate and the Committee on Agriculture of the House of 
     Representatives a report describing the determination made 
     and the extent of the adjustment made.
       The Conference has made it a priority to craft a program 
     that provides assistance to producers in a way that is 
     consistent with our obligations under the Uruguay Round 
     Agreement on Agriculture. (Section 1601)
     (51) Extension of Suspension of Permanent Price Support 
         Authority
       The House bill amends Section 171 of the FAIR Act.
       (a) Agricultural Adjustment Act of 1938.--Section 171(a)(1) 
     of the Federal Agriculture Improvement and Reform Act of 1996 
     (7 U.S.C. 7301(a)(1)) is amended by striking ``2002'' both 
     places it appears and inserting ``2011''.
       (b) Agricultural Act of 1949.--Section 171(b)(1) of the 
     Federal Agriculture Improvement and Reform Act of 1996 (7 
     U.S.C. 7301(b)(1)) is amended by striking ``2002'' both 
     places it appears and inserting ``2011''.
       (c) Suspension of Certain Quota Provisions.--Section 171(c) 
     of the Federal Agriculture Improvement and Reform Act of 1996 
     (7 U.S.C. 7301(c)) is amended by striking ``2002'' and 
     inserting ``2011''. (Section 182)
       The Senate amendment amends Section 171 of the Fair Act. 
     Section 171 of the Federal Agriculture Improvement and Reform 
     Act of 1996 (7 U.S.C. 7301) is amended--
       (1) by striking ``2002'' each place it appears and 
     inserting ``2006''; and
       (2) in subsection (a)(1)--
       (A) by striking subparagraph (E); and
       (B) by redesignating subparagraphs (F) through (I) as 
     subparagraphs (E) through (H), respectively. (Section 165)
       The Conference substitute adopts the House provision with 
     an amendment. (Section 1602)
     (52) Commodity Purchases
       The Senate Amendment provides new mandatory spending for 
     commodity purchases with a specific amount for specialty 
     crops, for the Department of Defense nutrition program and 
     for the Emergency Food Assistance Program. (Section 166)
       The House Bill contains no similar provision.
       The Conference Substitute adopts the Senate provision with 
     an amendment to provide a minimum of $200 million per year 
     from Section 32 funds for the purchase of fruits, vegetables 
     and other specialty food crops. A minimum of $50 million per 
     year of these funds is to be spent on the Department of 
     Defense Fresh Program. And the Secretary shall submit a 
     report not later than 1 year after the date of the enactment 
     of this Act, to the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, 
     Nutrition, and Forestry of the Senate that analyzes by 
     type the commodities purchased under this section as well 
     as by type the commodities purchased using all other 
     Section 32 funds. (Section 10603)
       The Managers intend that the funds made available under 
     this section are to be used for additional purchases of 
     fruits and vegetables, over and above the purchases made 
     under current law or that might otherwise be made without 
     this authority. The Managers expect the $200 million to be a 
     minimum amount for fruit and vegetable purchases under 
     Section 32 funds; it is not intended to interfere with or 
     decrease from Agricultural Marketing Service's historical 
     purchases of fruits and vegetables [e.g. $243 million in 
     2001; $232 million in 2000] or to decrease or displace other 
     commodity purchases. It is the Managers' further intention 
     that tree nuts may be included in the Secretary's definition 
     of ``other specialty food crops'' purchases for this section. 
     The Managers intend that none of the amounts made available 
     under this section for the purchases of fruits, vegetables, 
     and other specialty food crops may be used to purchase apples 
     for 2002 and 2003. The Secretary may continue to purchase 
     apples under other existing authority.
       The amendment requires that a minimum of $50 million from 
     the $200 million made available under section 10603 be used 
     exclusively for additional purchases of fresh fruits and 
     vegetables for the schools through the ``DoD Fresh'' program. 
     The Department of Agriculture currently provides $25 million 
     in funding each year for the purchase of fresh fruits and 
     vegetables for the schools, pursuant to existing authority 
     under the School Lunch Act. Through a 1995 memorandum of 
     agreement between the Agricultural Marketing Service, the 
     Food & Consumer Service, and the Defense Personnel Support 
     Center, the Department of Defense serves as the servicing 
     agency for the procurement of these fresh fruits and 
     vegetables through the ``DoD Fresh'' program. The Managers 
     strongly support efforts to fully utilize this program to 
     assist small businesses, specialty crop producers, and 
     schools in providing greater quantities of fresh fruits and 
     vegetables in USDA feeding programs, and expects

[[Page H1917]]

     the Secretary to review the effectiveness of the program in 
     meeting these goals on an on-going basis.
     (53) Hard White Wheat Incentive Payments
       The Senate amendment amends Sec. 193 of the FAIR Act. For 
     crop years 2003 through 2005, this section requires the 
     Secretary to use $40 million of funds of the Commodity Credit 
     Corporation to provide incentive payments to producers of 
     hard white wheat. The program offers wheat producers an 
     alternative crop to meet a growing international market 
     opportunity. (Section 167)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that provides for the 2003 through 2005 crop 
     years, a total of $20 million in hard white wheat incentive 
     payments to growers that demonstrate that buyers and end-
     users are available for the wheat to be covered by the 
     incentive payment. (Section 1616)
     (54) Limitations
       The House bill amends section 1001 of the Food Security Act 
     of 1985 to delete the references to production flexibility 
     contract and AMTA and include fixed, decoupled and counter-
     cyclical payment limitations. The total fixed, decoupled 
     payments and counter-cyclical payments to a person may not 
     exceed $50,000 and $75,000, respectively. The total of 
     marketing loan gains and loan deficiency payments that a 
     person is entitled to receive is $150,000.
       Peanuts, honey and wool and mohair have limitations for the 
     applicable programs separate from other commodities. (Section 
     183)
       The Senate amendment amends Section 1001 of the Food 
     Security Act of 1985. The total of direct and counter-
     cyclical payments that an individual or entity may receive 
     during any fiscal year for program commodities shall not 
     exceed $75,000. The total of marketing loan gains, forfeiture 
     gains, gains from marketing certificates and loan deficiency 
     payments that a person is entitled to receive for program 
     crops, peanuts, honey and wool is $150,000 per crop year.
       During a fiscal and corresponding crop year, the total 
     amount of payments and benefits that a married couple may 
     receive from direct, counter-cyclical and marketing loan is 
     $75,000 and $150,000 respectively, plus a combined total of 
     an additional $50,000. (Section 169)
       The Conference substitute provides the total direct and 
     counter-cyclical payments to a person for corn, grain 
     sorghum, barley, oats, wheat, soybeans, minor oilseeds, 
     cotton and rice may not exceed $40,000 and $65,000, 
     respectively. The total marketing loan gains and loan 
     deficiency payments for corn, grain sorghum, barley, oats, 
     wheat, soybeans, minor oilseeds, cotton, rice, lentils, dry 
     peas and small chickpeas that a person is entitled to receive 
     is $75,000.
       Provides for a separate direct and counter-cyclical payment 
     limitation for peanuts of $40,000 and $65,000, respectively. 
     Provides for a separate marketing loan gain and loan 
     deficiency payments limitation for peanuts, wool, mohair and 
     honey of $75,000.
       Retains current rules on husband and wife, 3-entities, 
     actively engaged, generic certificates and adopts the $2.5 
     million adjusted gross income means test.
       The Conference substitute refers to levels of adjusted 
     gross income or comparable measures of income. The Managers 
     intend that the comparable measure provision be utilized when 
     necessary and in cases of applicants for whom, because of 
     their status under the Internal Revenue Code, adjusted gross 
     income is not measured or reported. For example, participants 
     who are organized as C Corporations, S Corporations, or as 
     nonprofit organizations, the Managers intend for the 
     Secretary to use this direction to adopt the use of income 
     measure terms that compare most closely to adjusted gross 
     income. The Managers expect the Secretary to implement this 
     provision in a manner that provides equal treatment, to the 
     maximum extent practicable across all producers regardless of 
     the legal structure of their farming operation.
       For purposes of subsection (b), the Managers expect the 
     Secretary to determine the individual or entity to be 
     ineligible only if the adjusted gross income or similar 
     equivalent exceeds $2.5 million and less than 75 percent of 
     the adjusted gross income is derived from farming, ranching 
     or forestry operations as determined by the Secretary. 
     (Section 1603)
     (55) Adjustments of Loans
       The House bill extends current authority to adjust loans 
     so, to the maximum extent practicable, the average loan level 
     for a commodity will be equal to the level of support 
     determined appropriate under this Act. (Section 184)
       The Senate amendment retains current law as section 162 of 
     the FAIR Act with ``loan commodity'' reference. (Section 171)
       The Conference substitute adopts the House provision. 
     (Section 1606)
     (56) Personal Liability of Producers for Deficiencies
       The House bill amends Section 164 of the FAIR Act by 
     striking ``this title'' and inserting ``this title and title 
     I of the Farm Security Act of 2001''. The liability of a 
     producer is limited if the collateral securing any 
     nonrecourse loan is sold as long as the sale was not 
     fraudulent. (Section 185)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 1607)
     (57) Extension of Existing Administrative Authority Regarding 
         Loans
       The House bill amends Section 166 of the FAIR Act. The full 
     protection of marketing loan assistance to producers is 
     extended under this Act. (Section 186)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment that includes a reference to this Act. (Section 
     1608)
     (58) Assignment of Payments
       The House bill provides that producers may assign any 
     payments received under this Act by providing notice in a 
     manner prescribed by the Secretary. (Section 187)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 1612)
     (59) Report on Effect of Certain Farm Payments
       The House bill requires the Secretary to review the effects 
     that payments under production flexibility contracts and 
     market loss assistance payments have had, and that fixed, 
     decoupled and counter-cyclical payments are likely to have, 
     on the economic viability of producers and the farming 
     infrastructure. The review shall include a case study on the 
     effects these payments are likely to have on rice producers, 
     millers and the economies of rice farming areas in Texas. 
     (Section 187)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section ???)
     (61) Reserve Stock Level
       The Senate amendment reduces the reserve stock level for 
     Flue-cured tobacco from 100 million pounds (farm sales 
     weight) to 75 million pounds or 10 percent of the national 
     marketing quota. (Section 162)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that reduces the reserve stock level for Flue-
     cured tobacco from 100 million pounds (farm sales weight) to 
     60 million pounds. (Section 1610)
     (62) Farm Reconstitutions
       The Senate amendment provides for the 2002 crop only, the 
     Secretary shall allow special farm reconstitutions, in lieu 
     of lease of tobacco quota. Requires a study on the effects of 
     limitation on producers who move quota. (Section 163)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 1611)
     (63) Livestock Assistance Program
       The Senate amendment authorizes appropriations of $500 
     million for each of fiscal years 2003 through 2008 for the 
     livestock assistance program. (Section 168)
       The House bill contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 10104)
     (64) Restriction of Commodity and Crop Insurance Payments, 
         Loans and Benefits to Previously Cropped Land
       The Senate amendment restricts commodity and crop insurance 
     payments to previously cropped land. To be eligible for 
     benefits, land must have been planted, considered planted or 
     devoted to an agricultural commodity (excluding forage, 
     livestock, timber, forest products, or hay) at least 1 of the 
     5 crop years preceding the 2002 crop year, or at least 3 of 
     the 10 crop years preceding the 2002 crop year, or at least 1 
     of the 20 crop years preceding 2002 crop year if the land has 
     been maintained, using long-term crop rotation practices.
       There are exceptions for land enrolled in the conservation 
     reserve program and land under the jurisdiction of an Indian 
     tribe. (Section 170)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (65) Reports of Equitable Relief and Misaction-Misinformation 
         Requests
       The Senate amendment requires the Secretary to submit to 
     the Committee on Agriculture of the House of Representatives 
     and the Committee on Agriculture, Nutrition and Forestry of 
     the Senate a report the describes the requests for equitable 
     relief. (Section 172)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that provides State Executive Directors of the 
     Farm Service Agency and State Conservationists with the 
     Natural Resource Conservation Service authority to grant 
     relief in special circumstances. In addition, a report is 
     required to be provided annually that describes for the 
     previous calendar year, the number of requests for equitable 
     relief and the disposition of the requests. (Section 1613)
     (66) Estimates of Net Farm Income
       The Senate amendment requires the Secretary to include--
       ``(1) an estimate of the net farm income earned by 
     commercial producers in the United States; and
       ``(2) an estimate of the net farm income attributable to 
     commercial producers of each of--
       ``(A) livestock;

[[Page H1918]]

       ``(B) loan commodities; and
       ``(C) agricultural commodities other than loan 
     commodities.'' (Section 173)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 1615)
     (67) Commodity Credit Corporation Inventory
       The Senate amendment authorizes the Commodity Credit 
     Corporation to use of private sector entities when purchasing 
     and selling commodities. (Section 174)
       The House bill contains no comparable provision.
       The Conference substitute accepts the Senate provision. 
     (Section 1609)
     (68) Agricultural Producers Supplemental Payments and 
         Assistance
       The Senate amendment authorizes the Secretary to make 
     payments to persons who are eligible to receive assistance 
     under Public Law 107-25 but who did not receive the payments 
     or assistance prior to October 1, 2001.
       The amount of payments or assistance shall not exceed the 
     amount of payments or assistance the person would have been 
     eligible to receive under Public Law 107- 25.
       The House bill contains no comparable provision.
       The Conference substitute accepts the Senate provision with 
     an amendment to also include producers participating in 1998, 
     1999, 2000 or 2001 economic or disaster assistance programs 
     that have not been paid. (Section 1617)


               Subtitle E--Payment Limitation Commission

     (69) Establishment of Commission
       The Senate amendment establishes commission, specifies 
     membership, establishes terms, meetings, quorum, and provides 
     that the Secretary appoint one commissioner to serve as 
     Chair. (Section 181)
       The House bill contains no comparable provision.
       The Conference substitute provides for the establishment of 
     a Commission on the Application of Payment Limitations for 
     Agriculture.
       The Commission shall be composed of 10 members of which 3 
     members are appointed by the Secretary of Agriculture, 3 
     members by the Committee on Agriculture, Nutrition and 
     Forestry of the Senate, 3 members by the Committee on 
     Agriculture of the House of Representatives and the Chief 
     Economist of the Department of Agriculture.
       The Managers encourage the appointing authorities to ensure 
     that the membership of the commission has a diversity of 
     experiences and expertise on the issues to be studied by the 
     Commission. (Section 1605)
     (70) Duties
       The Senate amendment requires the commission to conduct a 
     comprehensive review of payment limitations. (Section 182)
       The House bill contains no comparable provision.
       The Conference substitute requires that the Commission 
     conduct a study on the potential impacts of further payment 
     limitations on the receipt of direct payments, counter-
     cyclical payments, and marketing loan gains and loan 
     deficiency payments on farm income, land values, rural 
     communities, agribusiness infrastructure, planting decisions, 
     supply and prices of covered commodities and other 
     agriculture commodities, including fruits and vegetables.
       Not later than 1 year after the date of enactment of this 
     Act, the Commission shall submit a report containing the 
     results of the study, including such recommendations as the 
     Commission considers appropriate.
       The Managers intend for the Commission to examine the 
     feasibility of improving the application and effectiveness of 
     payment limitation requirements, including the use of 
     commodity certificates and unlimited forfeiture of loan 
     collateral. (Section 1605)
     (71) Powers
       The Senate amendment authorizes the commission to hold 
     hearings and obtain information from Federal agencies. 
     (Section 183)
       The House bill contains no comparable provision.
       The Conference substitute provides that the Commission may 
     hold such hearings, meet and act, take testimony and receive 
     evidence the Commission considers advisable to carry out 
     their duties. (Section 1605)
     (72) Commission Personnel Matters
       The Senate amendment provides for compensation of members. 
     (Section 184)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 1605)
     (73) Federal Advisory Committee Act
       The Senate amendment exempts the commission from the 
     Federal Advisory Committee Act. (Section 185)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 1605)
     (74) Funding
       The Senate amendment authorizes the Secretary to use not 
     more than $100,000 of the funds of the CCC to carry out this 
     subtitle. (Section 186)
       The House bill contains no comparable provision.
       The Conference substitute provides that the Commission may 
     use the mail in the same manner and under the same conditions 
     as other agencies of the Federal Government, allows the 
     Secretary to provide appropriate office space and allows for 
     the reimbursement of travel expenses. (Section 1605)
     (75) Termination of Commission
       The Senate amendment provides that the Commission 
     terminates on the day after the Commission submits its 
     report. (Section 187)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.


              Subtitle F--Emergency Agriculture Assistance

     (76) Income Loss Assistance
       The Senate amendment provides $500 million in emergency 
     livestock assistance for 2001 losses. (Section 192)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (77) Market Loss Assistance for Apple Producers
       The Senate amendment provides $100 million for apple 
     producers for the loss of markets during the 2000 crop year 
     and further specifies payment quantity and payment/
     eligibility limitations parameters. (Section 193)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments to provide $94 million to apple producers for the 
     loss of markets during the 2000 crop year, payment quantity 
     parameters are retained, the Secretary shall not establish a 
     payment limitation or an income eligibility limitation with 
     respect to payments made on the payment quantity of 5 million 
     pounds of apples produced on the farm; and promulgation of 
     regulations and administration of this section will be exempt 
     from the rulemaking requirements and Paperwork Reduction Act. 
     Also provides $10 million as a grant to the State of New York 
     to be used to support current onion producers in Orange 
     County, New York, who have suffered losses to onion crops 
     during one or more of the 1996 through 2000 crop years. 
     (Section 10105)
     (78) Commodity Credit Corporation
       The Senate amendment authorizes the Secretary to use the 
     funds, facilities, and authorities of the Commodity Credit 
     Corporation to carry out this subtitle. (Section 194)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (79) Administrative Expenses
       The Senate amendment authorizes the transfer of $50 million 
     from the Treasury to the Department of Agriculture to pay 
     salaries and expenses in carrying out this subtitle.(Section 
     195)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (80) Regulations
       The Senate amendment authorizes the Secretary to promulgate 
     rules and regulations to implement this subtitle. (Section 
     196)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (81) Emergency Requirement
       The Senate amendment designates the entire amount necessary 
     to carry out this subtitle as emergency spending. (Section 
     197)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.

                         Title II--Conservation


               Subtitle A--Conservation Security Program

     (1) Conservation Security Act
       The Senate amendment establishes the Conservation Security 
     Program (CSP) and provides the applicable definitions. 
     (Section 201 (Section 1238))
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     modification. The Managers expect the Secretary to implement 
     the CSP to encourage the widest participation possible at a 
     level that ensures resources are protected at a non-
     degradation level. (Sec. 2001)
     (2) Conservation Security Program
       The Senate amendment establishes the CSP for fiscal years 
     2003 through 2006 to assist producers in implementing various 
     conservation practices as applicable for each individual 
     operation. Eligible lands include private cropland, 
     grassland, prairie land, pasture land and rangeland and 
     private forest land in agro-forestry practices.
       The Senate amendment establishes three tiers of 
     conservation contracts that provide flexibility to farmers. 
     Eligible practices may include the continuation of some 
     practices combined with the adoption of new practices. 
     Producers must adopt or maintain practices to address a 
     resource concern of the operation, such as soil or water 
     quality.
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     modification. The CSP, which is open to all producers for 
     maintaining or adopting practices on private agricultural 
     land, will be established from fiscal years 2003 through 
     2007. Only private agricultural lands and forested land that 
     is incidental to an agricultural operation is eligible for 
     enrollment. Lands enrolled in the

[[Page H1919]]

     Conservation Reserve Program (CRP), the Wetlands Reserve 
     Program (WRP), or the Grasslands Reserve Program (GRP) and 
     not eligible for enrollment, nor are lands that have not been 
     cropped for more than four out of the past six years. This 
     change is to help discourage producers from using the program 
     as an inducement to cultivate land. Because this is a working 
     lands program, producers will be allowed economic use of the 
     land, in a manner consistent with the program. (Section 2001)
       Agricultural producers are longtime stewards of America's 
     lands. In establishing the CSP, the Managers recognize the 
     need to support ongoing stewardship by providing incentive 
     payments for producers to maintain and enhance conservation 
     practices at a non-degradation level.
       The Managers intend to assist agriculture producers to 
     concentrate on resource problems, including soil, air, water, 
     plant and animal (including wildlife) and energy 
     conservation, on their particular operation using a broad 
     array of conservation practices. Participation does not 
     require a producer to address a locally-identified priority. 
     Instead, a producer may receive an enhanced payment for 
     addressing locally-identified priorities which will be 
     determined by the state technical committees working with 
     local working groups and agricultural producers. Overall, the 
     Managers intend that the enhanced payments be used to ensure 
     and optimize environmental benefits. The enhanced payments 
     should reward producers who go beyond the minimum 
     requirements of the program to address additional resource 
     concerns.
       The Managers intend that the Secretary shall provide base 
     payments based on the average national rental rate for the 
     specific land use type. The Managers encourage the Secretary 
     to look at alternative approaches for a base payment that is 
     not based on rental rates. In applying another appropriate 
     rate to ensure regional equity, the Secretary shall not 
     provide a rate lower than the national average rental 
     rate.
       The Managers intend the Secretary will not employ an 
     environmental bidding or ranking system in implementing CSP 
     and approve should approve a producer's contract that meets 
     the standards of the program. The Managers are aware that 
     many agricultural producers who want to adopt conservation 
     practices have not had access to conservation program 
     funding. Together, with the overall increase in funds for all 
     conservation programs, agriculture producers who chose to 
     employ conservation practices should have access to funding.
       The Secretary should provide cost-share payments at a rate 
     not exceeding 75 per cent. The Secretary should provide cost-
     share assistance at a comparable rate as that provided under 
     the Environmental Quality Incentives Program for the same 
     practices. In limiting cost-share for land-based structures, 
     payments should be limited to those structures that are 
     integral to the land-based conservation system.
       The Managers expect the Secretary to implement the CSP in a 
     manner that will allow all agricultural producers, including 
     fruit and vegetable producers and livestock producers, to 
     participate equitably in the program. The Managers also 
     direct the Secretary to begin CSP at the full national level 
     as soon as practicable.
       While CSP is directed toward practices on working 
     agricultural lands, the Managers recognize that some land use 
     practices may involve alternative uses of the land, such as 
     providing for wildlife habitat or the corners on center-pivot 
     irrigation systems, and expect the Secretary to include these 
     parcels, when incidental to the operation, as part of the CSP 
     contract.
       The Managers are aware of the unique conservation and 
     production practices utilized by specialty crop growers 
     throughout the United States. The Managers expect the 
     Department to ensure that adequate resources are made 
     available for specialty crop conservation practices under 
     CSP. They also expect that, in carrying out the financial 
     assistance provisions of various conservation programs the 
     unique production practices involved in fruit and vegetable 
     production, are taken into account when drafting and 
     implementing regulations to carry out those programs.
     (3) Partnerships and Cooperation
       The Senate amendment allows the Secretary to designate 
     special projects and enter into agreements with nonfederal 
     entities to provide enhanced technical and financial 
     assistance to be used by owners to meet the purposes of the 
     Clean Water Act, Safe Drinking Water Act and Clean Air Act, 
     and other Federal, state or local laws, and to address 
     environmental issues associated with watersheds of special 
     significance or other geographic areas of environmental 
     sensitivity such as wetlands.
       It also allows the Secretary to provide incentive payments 
     to producers participating in special projects to encourage 
     partnerships and sharing of technical and financial resources 
     among owners, producers, government and non-governmental 
     organizations and to adjust the application of eligibility 
     criteria, approved practices, innovative conservation 
     practices and other elements of the conservation programs to 
     better reflect unique local circumstances, if consistent with 
     environmental enhancement and purposes and requirements of 
     the title. Participating parties must submit a plan to the 
     Secretary. The purposes of the special projects include the 
     installation of systems affecting multiple agricultural 
     operations and innovative techniques. This provision directs 
     the Secretary to use 5 percent of the funds made available 
     for the EQIP to carry out special projects consistent with 
     the purposes of EQIP. (Section 203) The House bill contains 
     no comparable provision.
       The Conference substitute adopts the Senate provision with 
     modification. The Secretary may enter into agreements to 
     enhance technical and financial assistance provided to 
     owners, operators, and producers to address natural resource 
     issues related to agricultural production. The Secretary may 
     provide incentives for special projects to encourage 
     partnerships and enrollments of optimal conservation value. 
     (Section 2003)
       The Managers intend for the Secretary to use this authority 
     to help producers avoid the need for further federal and 
     state regulation to protect clean water and air. The 
     Secretary is strongly encouraged to be proactive in 
     establishing partnerships in critical areas such as the 
     Chesapeake Bay.
     (4) Administrative Requirements for Conservation Programs
       (a) Good-faith reliance
       The Senate amendment requires the Secretary to provide 
     relief to owners, operators or producers injured by good 
     faith reliance based on an action or on the advice of an 
     employee of the Secretary.
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision due 
     to the adoption of a general good faith reliance provision 
     covering both the commodity and conservation titles. (Section 
     2004)
       (b) Education, assessment and evaluation
       The Senate amendment requires the Secretary to provide 
     education, outreach, training, monitoring, evaluation, and 
     technical assistance to agricultural producers. Allows 
     Secretary to enter contracts with nonfederal entities to 
     provide these services.
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. The 
     Secretary has been providing education and outreach to 
     agricultural producers, beginning farmers and ranchers and 
     Indian tribes. The Managers intend that education, 
     monitoring, and assessment of the programs under Subtitle D 
     of the 1985 Food Security Act be conducted as a part of the 
     technical assistance for these programs. In carrying out 
     these activities, the Managers would also expect the 
     Secretary to utilize the experience and expertise of outside 
     entities such as, states (including state agencies and local 
     units of government), educational institutions, and non-
     profit groups with a demonstrated history of working with 
     agricultural producers. The Managers expect $10 million per 
     year from technical assistance funds for the conservation 
     programs to be used for these purposes.
       (c) Beginning and limited-resource farmers
       The Senate amendment allows the Secretary to provide 
     beginning farmers and ranchers and Indian tribes and limited-
     resource producer incentives to participate in conservation 
     programs.
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision for 
     beginning farmers and ranchers. (Section 2004)
       (d) Maintenance of conservation data
       The Senate amendment requires the Secretary to maintain 
     data concerning conservation plans and programs.
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. 
     (Section 2004)
       (e) Mediation
       The Senate amendment requires the Secretary to provide 
     aggrieved producers mediation services or an informal hearing 
     on the matter.
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. 
     (Section 2004)
       (f) Privacy
       The Senate amendment directs the Secretary to ensure the 
     privacy of individual information provided to USDA to secure 
     technical or financial assistance for conservation programs. 
     Information may be released to the Attorney General to 
     enforce programs. (Section 204)
       The House bill amended the Freedom of Information Act to 
     provide similar protections for producer-provided 
     information.
       The Conference substitute adopts the Senate provision with 
     modification.
       (g) Cooperation with tribal governments
       The Senate amendment directs the Secretary to cooperate 
     with the tribal government of Indian tribes when 
     administering lands under the jurisdiction of an Indian 
     tribe.
       The House bill contains no comparable provision.
       The Conference substitute deletes this provision due to the 
     adoption of similar provisions in the Miscellaneous Title. 
     (Section 2004)
     (5) Reform and Assessment of Conservation Programs
       The Senate amendment directs the Secretary to develop a 
     plan for coordinating conservation plans and programs to 
     facilitate implementation and delivery of conservation 
     programs and provide a report to

[[Page H1920]]

     Congress within 180 days after enactment of this Act. 
     (Section 205)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     modification. (Section 2005)
     (6) Conservation Security Program Regulations
       The Senate amendment states that the Secretary may 
     promulgate regulations for implementation of the CSP upon 
     enactment of this Act. (Section 206)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 2702)
     (7) Conforming Amendments
       The House bill reauthorizes the Environmental Conservation 
     Acreage Reserve Program (ECARP) through 2011 and removes 
     provisions establishing conservation priority areas. (Section 
     201)
       The Senate amendment renames the ECARP the Comprehensive 
     Conservation Enhancement Program (CCEP), reauthorizes the 
     CCEP programs through 2006, and directs the Secretary to give 
     priority to areas in which designated land would facilitate 
     the most rapid completion of projects that are ongoing as of 
     the date of the application. (Sections 207 and 211)
       The Conference substitute adopts the Senate provision, with 
     a modification that removes priority areas from CCEP as well 
     as the reference to priority being given to the most rapid 
     completion of projects. Also, the substitute extends the 
     program to 2007. (Section 2006)
       The Managers find that bobwhite quail are a valued 
     traditional symbol of farmed landscapes, but their 
     populations have declined by two-thirds since 1980. The 
     Managers further find that the success of the Southeast Quail 
     Study Group's new ``Northern Bobwhite Conservation 
     Initiative'' is largely dependent upon land management 
     actions by agricultural producers and non-industrial private 
     forestland owners. The Managers further find that many 
     conservation programs of this farm bill have large potential 
     to contribute to bobwhite quail habitat objectives and 
     encourage the Secretary to support the goal of restoring 
     habitat for this species.
       The Managers intend that the CRP, the CREP, the Wildlife 
     Habitat Incentives Program (WHIP), the EQIP, the WRP, the 
     GRP, the CSP and other USDA programs could be helpful in 
     supplementing the Comprehensive Everglades Restoration 
     Program. The Secretary is encouraged to work with appropriate 
     state and federal officials to develop and implement a 
     coordinated plan toward this end.


                Subtitle B--Conservation Reserve Program

     (1) Reauthorization
       The House bill reauthorizes the CRP through 2011 and adds 
     conservation and improvement of wildlife resources to the 
     scope of the program's purpose. (Section 211)
       The Senate amendment reauthorizes the CRP through 2006. 
     (Section 212(a))
       The Conference substitute adopts the House provision with a 
     modification that extends the program to 2007. (Section 2101)
     (2) Enrollment
       The House bill modifies language on land eligibility to 
     add: (1) marginal pasturelands devoted to natural vegetation 
     in or near riparian areas or for similar water quality 
     purposes, (2) land that the Secretary determines will 
     contribute to the degradation of soil, water or air quality 
     or poses an environmental threat if permitted to remain in 
     production, (3) land where soil, water and air quality 
     objectives cannot be achieved under the Environmental Quality 
     Incentives Program (EQIP), and (4) land where enrollment 
     would contribute to the conservation of ground or surface 
     water. (Section 212(a))
       The Senate amendment modifies language on vegetative cover, 
     providing that in the case of marginal pastureland, an owner 
     or operator shall not be required to plant trees if the land 
     is to be restored as a wetland or with appropriate native 
     riparian vegetation. (Sec. 212 (g))
       The Conference substitute adopts the House provision with a 
     technical change. Marginal pastureland should be devoted to 
     appropriate vegetation, including trees, in or near riparian 
     areas or for similar water quality purposes, including 
     marginal pastureland converted to wetlands or established as 
     wildlife habitat. (Section 2101)
       The Conference substitute adopts the House provision on 
     land which would contribute to degradation of soil, water or 
     air quality if permitted to remain in production. The 
     substitute also adopts the provision on land where enrollment 
     would contribute to the conservation of ground or surface 
     water, with modification that land may only be enrolled where 
     the measure would provide a net savings in ground or 
     surface water resources on the agricultural operation of 
     the producer. This is a new factor, under CRP, that should 
     not be given a significant increase in points under the 
     Environmental Benefits Index. (Section 2101)
     (3) Eligibility and Cropping History
       The House amendment modifies the language on eligibility to 
     limit enrollment of land that has not been in production for 
     at least four years.
       The Senate amendment modifies language on eligibility of 
     highly-erodible cropland that cannot be farmed in accordance 
     with a conservation plan, and requires that the land have a 
     cropping history or be considered to have been planted for 
     three of the six years preceding the enactment of this 
     legislation, and modifies language on land eligibility to 
     add: (1) the portion of land in a field in cases where more 
     than 50 percent of the land in the field is enrolled as a 
     buffer, and (2) land (including land with no cropping 
     history) enrolled through the continuous sign-up program or 
     Conservation Reserve Enhancement Program (CREP). (Section 212 
     (b))
       The Conference substitute adopts the Senate provision, with 
     modification requiring that land have a cropping history or 
     be considered to have been planted for four of the six years 
     preceding the enactment of this legislation to be eligible. 
     The Managers are concerned about reports that producers are 
     planting crops on non-cropped lands as a means of being 
     eligible to participate in CRP. This language is intended to 
     prevent the enrollment of these lands under CRP. (Section 
     2101)
       The Conference substitute deletes the Senate provision on 
     land, other than cropland, being enrolled in the continuous 
     sign-up program. However, the Managers understand the 
     Secretary is currently reviewing the land eligibility 
     criteria, including the eligibility of non-cropland that 
     could be restored to serve as buffers. The Managers expect 
     the Secretary to do this examination expeditiously. (Section 
     212(b)) (Section 2101)
       The Conference substitute adopts the Senate provision with 
     modification on the eligibility of partial fields. The 
     provision allows producers to enroll entire fields through 
     the continuous CRP as buffers in cases in which more than 50 
     percent of the field is eligible for enrollment and the 
     remainder of the field is infeasible to farm. The 
     modification restricts payments on the remaining acreage to 
     general sign-up rates. (Section 212 (b)(1)(B)) (Section 2101)
       The Managers intend the USDA to allow prescribed burning 
     and other measures that are intended to enhance forage for 
     the benefit of pheasants and other wildlife species on land 
     enrolled in the CRP.
       In carrying out the CRP, the Managers direct the Secretary 
     to evaluate qualifications and criteria relating to spring 
     wind erosion of sandy soils not currently recognized by the 
     Wind Erosion Equation.
       The Managers expect the Secretary to develop ways to make 
     land prone to frequent seasonal flooding, such as 3 out of 
     the last 5 years, eligible for enrollment in the CRP, 
     including, but not limited to, designating the area as a 
     conservation priority area.
     (4) Acreage Limitations
       The House bill increases the acreage cap to 39.2 million 
     acres. (Section 212(b))
       The Senate amendment increases the acreage cap to 41.1 
     million acres. (Section 212 (c))
       The Conference substitute adopts the House provision on 
     raising the acreage cap to 39.2 million acres. (Section 2101)
     (5) Priority Areas
       The House bill deletes priority areas and requires that on 
     the expiration of a CRP contract the land shall be eligible 
     to be considered for re-enrollment in the program. (Section 
     212)
       The Senate amendment modifies language regarding priority 
     areas to direct the Secretary to give priority to areas in 
     which designated land would facilitate the most rapid 
     completion of projects that are ongoing and that meet the 
     purposes of the program.
       The Conference substitute adopts the Senate provision that 
     retains priority areas. The Managers recognize that 
     conservation benefits may increase from cumulative enrollment 
     and encourages the Secretary to consider these cumulative 
     benefits by enrolling lands in areas where land is currently 
     enrolled. (Section 2101)
       The Managers expect the Secretary to revisit the issue of 
     how the CRP national priority area for the Prairie Pothole 
     Region was determined and direct the Secretary to utilize the 
     Prairie Pothole Joint Venture Implementation Plan map as the 
     area to be considered the national CRP priority area for the 
     Prairie Pothole Region.
       The Conference substitute adopts the House provision on 
     requiring land to be considered for re-enrollment in CRP. It 
     is the intent of the Managers not to provide an automatic re-
     enrollment of these lands, but instead require that these 
     lands go through the normal application process. (Section 
     2101)
     (6) Balance of Natural Resources
       The House bill requires the Secretary to do a rule making 
     that balances CRP contracts between soil erosion, water 
     quality and wildlife habitat. (Section 212)
       The Senate amendment has no comparable provision
       The Conference substitute adopts the House provision to 
     conduct a rulemaking to achieve a balance between natural 
     resource purposes. (Section 2101)
       The Managers are concerned that a general sign-up has not 
     taken place for several years. The Managers expect the 
     Secretary to hold a general sign-up as soon as practicable.
     (7) Hardwood Trees
       The Senate amendment permits the Secretary to extend the 
     duration of CRP contracts for an additional 15 years in the 
     case of land devoted to hardwood trees. The Secretary may 
     provide rental payments in an amount not exceeding 50 percent 
     of the applicable rental payment before the contract was 
     extended. For new CRP contracts with hardwood trees, the 
     Secretary may allow 30-year contracts at reduced rates. The 
     bill provides a one-year extension on 15-year contracts 
     required to be terminated by statute. (Section 212 (d))

[[Page H1921]]

       The House bill contains no comparable provision.
       The Conference substitute strikes the Senate provision 
     regarding longer-term contracts for hardwood trees, but the 
     substitute adopts the Senate provision regarding one-year 
     extensions. (Section 2101)
       It has come to the attention of the Managers that CRP 
     offers that include the planting of longleaf pines may not be 
     receiving a weight equal to those assigned to other softwoods 
     planted on CRP contract acres. The Managers encourage the 
     Secretary to take such measures as may be necessary to ensure 
     that a portion of land accepted for CRP contracts devoted to 
     pine trees include longleaf pines.
     (8) Irrigated Land Rates
       The Senate amendment makes irrigated land eligible for 
     enrollment at irrigated land rates unless the Secretary 
     determines that other compensation is appropriate. (Section 
     212 (f))
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. 
     (Section 2101)
     (9) Signing and Practice Incentive Payments
       The Senate amendment directs the Secretary to provide 
     signing and practice incentive payments for landowners who 
     implement a practice under the conservation buffer or CREP 
     programs at the highest rate currently provided. (Section 
     212(i))
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. 
     (Section 2101)
       The Managers are concerned that the payments for practices 
     may not reflect the conservation benefits of the practices. 
     Grass wind strips, shelterbelts, living snow fences and 
     wellhead protection are particular activities that should 
     receive serious consideration for signing and practice 
     incentive payments. The Managers strongly encourage the 
     Secretary to re-examine the procedures used to determine the 
     incentive payment. The Managers intend that the Secretary 
     should continue current signing and practice incentive 
     payments throughout the duration of this legislation.
     (10) Payment Limits for Conservation Buffers and CREP
       The Senate amendment creates an exception to the CRP 
     payment limit for payments received for conservation buffers 
     and the CREP. (Section 212(j))
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. 
     (Section 2101)
     (11) County Acreage Limitation
       The Senate amendment exempts land enrolled under continuous 
     sign-up from the limitation on the percentage of land in a 
     county eligible for enrollment. (Section 212 (k))
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. 
     (Section 2101)
     (12) Report on Economic and Social Impacts
       The Senate amendment requires the Secretary to submit a 
     report to the House and Senate Agriculture Committees about 
     the economic and social impacts on rural communities 
     resulting from the CRP within 270 days from the date of 
     enactment of this legislation. (Section 212(l)).
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     modifications that require the Secretary to submit the report 
     within 18 months and require the Secretary to consider the 
     economic value from recreational opportunities (including 
     hunting and fishing). (Section 2101)
     (13) Duties of Owners and Operators
       The House bill permits landowners to maintain existing 
     cover where practicable. In addition, it authorizes the 
     Secretary to permit managed haying and grazing, wind turbines 
     and biomass recovery as long as these activities are 
     consistent with the conservation of soil, water quality and 
     wildlife habitat. Finally, the House bill deletes the 
     environmental use and alley-cropping provisions. (Section 
     213)
       The Senate amendment permits owners of marginal pasture 
     land not to plant trees if native prairie grass may be 
     retained or restored or if land is restored as a wetland; 
     directs the Secretary to permit harvesting or grazing for 
     maintenance purposes, without a reduction in rental payment, 
     on acres that are enrolled to establish conservation buffers 
     and acres enrolled into the CREP in a manner that is 
     consistent with the purposes of the CRP; allows the Secretary 
     to permit an owner of CRP land, other than that enrolled 
     under continuous sign-up, to install wind turbines on the 
     land at a reduced rate; and modifies language regarding 
     duties of participating landowners to say that an owner also 
     agrees not to produce a crop for the duration of the CRP 
     contract on any other highly erodible land without a cropping 
     history that the owner owns or operates with exemptions of 
     land used as a homestead or building site. (Section 212 (g), 
     (h))
       The Conference substitute adopts the House provision to 
     permit landowners to continue with existing cover where 
     practicable and consistent with wildlife reserve benefits of 
     CRP. (Section 2101)
       The Conference substitute adopts the House provision on 
     managed haying (including for biomass) and grazing and wind 
     turbines, with modification. USDA will permit, consistent 
     with the conservation of soil, water quality and wildlife 
     habitat, managed harvesting and grazing on the land at a 
     reduced rate. Harvesting and grazing or other commercial use 
     of the forage is permitted in response to a drought or other 
     emergency. In addition, the Secretary shall ensure that all 
     precautions are taken to protect against overgrazing or 
     haying or use of land during a period that may adversely 
     impact wildlife habitat or wildlife directly, especially 
     ensuring that activities take place after nesting season is 
     completed. USDA, with the State technical committees, will 
     develop appropriate vegetation management requirements 
     including appropriate harvesting and grazing periods. In 
     determining the appropriate use of CRP lands for haying and 
     grazing (including the frequency and time period), the 
     Secretary shall require the State Technical Committees to 
     consider the type of grass (shrubs, forbs or bushes) on the 
     land as well as the local ecosystem. (Section 2101)
       The Secretary shall permit wind turbines on CRP land, 
     whether commercial in nature or not, in a manner that does 
     not interfere with wildlife. In so doing, the Secretary may 
     restrict the number and location of wind turbines that may be 
     installed on a tract of land. The Secretary shall take 
     special care when allowing wind turbines on small parcels of 
     land, especially buffers, so that turbines are spaced in a 
     manner that does not interfere with wildlife habitat, flyways 
     or movement. (House Section 213(1)(C)) (Section 212 (h)(f))
       The Conference substitute deletes the Senate provision 
     requiring an owner to agree not to produce a crop for the 
     duration of the CRP contract on any other highly erodible 
     land without a cropping history that the owner owns or 
     operates. (Section 2101)
       The Conference substitute adopts the House provision to 
     delete the environmental use and alley-cropping provisions.
     (14) Reference to Conservation Reserve Payments
       The House bill replaces the term rental payment with 
     conservation reserve payment. (Section 214)
       The Senate amendment has no comparable provision.
       The Conference substitute deletes the House provision. 
     (Section 2101)
     (15) Expansion of Pilot Program to All States
       The House bill reauthorizes the project through 2011, 
     directs the Secretary to carry out a project in each state 
     and limits enrollment to not more than 150,000 acres in any 
     state.
       The Senate amendment reauthorizes the pilot program through 
     2006 in Minnesota, Montana, Nebraska, Iowa, North Dakota and 
     South Dakota. Expands the maximum size of any wetland 
     enrolled to 10 contiguous acres with not more than 5 acres 
     being eligible for payment. (Section 212(e))
       The Conference substitute adopts the House provision with 
     modification. The Secretary shall carry out a nationwide 
     program, limiting enrollment to 100,000 acres in any state 
     and a million acres nationwide. After three years the 
     Secretary may reallocate another 50,000 acres to interested 
     states, based on their original allocation. The provision 
     also expands the maximum size of any wetland enrolled to 10 
     contiguous acres with not more than 5 acres being eligible 
     for payment. This change was made to facilitate enrollment of 
     lands that meet the eligibility of the program and will 
     achieve the goals of this program. The Secretary shall ensure 
     that changes to regulations to the program do not have a 
     significant impact on the original 6 states involved in the 
     pilot program. (Section 2101)
       In expanding the CRP Wetland Pilot nationwide, the Managers 
     recognize that the playa lakes found throughout the Southern 
     Great Plains states of Kansas, Oklahoma, Colorado, New Mexico 
     and Texas, are also worthy of protection as they function as 
     recharge points for the Ogalalla Aquifer, help in containing 
     flood waters and provide habitat for hundreds of bird 
     species. Playa lakes are the most significant topographical 
     and hydrological attribute in the Southern Great Plains. 
     Playa lakes are often dry enough to be farmed due to the 
     annual precipitation rates and high evaporation rates that 
     occur in the high plains.
     (16) Water Conservation
       The Senate amendment requires the Secretary to provide up 
     to 500,000 acres for CREP for water conservation measures in 
     California, Maine, Nevada, New Hampshire, New Mexico, Oregon, 
     and Washington. (Section 215)
       The House bill contains no comparable provision.
       The Conference substitute strikes the Senate provision. 
     (Section 2101)
       The Managers encourage the Secretary to allow states to 
     have flexibility in creating CREP programs.


                  subtitle c--wetlands reserve program

     (1) Enrollment
       The House bill allows the Secretary to enroll an additional 
     150,000 acres per year. Any acres not enrolled may be carried 
     over to subsequent years. (Section 221)
       The Senate amendment clarifies that technical assistance is 
     provided under the WRP and allows the Secretary to raise the 
     acreage cap to 2.225 million acres. Of this acreage, the 
     Secretary may enroll not more than 25,000 acres per year in 
     the Wetlands Reserve

[[Page H1922]]

     Enhancement Program (WREP). (Section 214 (a) and (b))
       The Conference substitute adopts the Senate provision with 
     modification to increase the acreage cap up to 2.275 million 
     acres. Also, the substitute requires the Secretary to enroll 
     250,000 acres per year to the maximum extent practicable. 
     (Section 2202)
     (2) Easements and Cost-Share Allocations
       The House bill strikes language requiring the Secretary to 
     enroll acres with numeric allocations to particular methods. 
     Directs the Secretary to enroll acres through easements, 
     restoration cost share agreements or both. (Section 221)
       The Senate amendment has no comparable provision.
       The Conference substitute strikes the House provision. It 
     modifies current law to clarify that land can be enrolled 
     with 30-year or permanent easements, restoration cost share 
     agreements or both. The Conference substitute also continues 
     to require the Secretary to enroll lands in proportion to 
     landowner interest. (Section 1237(b)(2)(B)). (Section 2203)
     (3) Reauthorization
       The House bill extends the WRP through 2011. (Section 221)
       The Senate amendment extends the WRP through 2006. (Section 
     214 (c))
       The Conference substitute extends the WRP through 2007. 
     (Section 2201)
     (4) Wetlands Reserve Enhancement Program
       The Senate amendment creates a WREP under which the 
     Secretary may enter into cooperative with state or local 
     governments, and with private organizations, to conduct 
     wetland restoration activities that address critical 
     environmental issues. (Section 214 (d))
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. 
     (Section 2202)
     (5) Technical Assistance, Monitoring and Maintenance
       The Senate amendment clarifies that technical assistance 
     includes monitoring and maintenance of the terms and 
     conditions of the easement and the plan. (Section 214 (e))
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. 
     (Section 2203)
     (6) Easements and Agreements
       The House bill consolidates the language defining 
     prohibited activities to prohibit the alteration of wildlife 
     habitat and other natural features of such land, 
     unless specifically permitted by the plan. Consolidates 
     the language describing the length of a WRP easement to 
     say that easements shall be consistent with applicable 
     state law, and strikes redundant language stating that the 
     Secretary can enroll land into the WRP using restoration 
     cost-share agreements. (Section 222)
       The Senate amendment has no comparable provision.
       The Conference substitute deletes the House provisions on 
     prohibited activities and length of easements. In addition, 
     it strikes the redundant provision in current law regarding 
     restoration cost-share agreements. (Section 2203)
     (7) Duties of the Secretary
       The House bill deletes a provision that requires the 
     Secretary to give priority to obtaining permanent 
     conservation easements and easements designed to protect and 
     enhance habitat for migratory birds and other wildlife. 
     (Section 223)
       The Senate amendment has no comparable provision.
       The Conference substitute deletes the House provision. 
     (Section 2203)
     (8) Changes in Ownership: Agreement Modification; Termination
       The House bill amends the language regarding changes in 
     ownership to provide that no easement can be created on land 
     that has changed ownership in the past 12 months unless: (1) 
     the new ownership was acquired by will or succession as a 
     result of the death of the previous owner, (2) the ownership 
     change occurred due to foreclosure on the land and the owner 
     of the land exercises a right of redemption from the mortgage 
     holder in accordance with state law, or (3) the Secretary 
     determines that the land was acquired under circumstances 
     which give adequate assurances that such land was not 
     acquired for the purposes of placing it in the WRP. (Section 
     223)
       The Senate amendment has no comparable provision.
       The Conference substitute adopts the House provision with a 
     modification to replace the section on changes in ownership 
     due to a foreclosure with new language. (Section 1237E(a)(2)) 
     (Section 2204)


          subtitle d--environmental quality incentives program

     (1) Purposes
       The House bill strikes language describing the purpose of 
     the EQIP as combining four previous conservation programs 
     into a single program; strikes language regarding carrying 
     out a program to maximize the environmental benefits per 
     dollar expended; and rewords language about assisting farmers 
     and ranchers who face the most serious environmental threats 
     to providing assistance to farmers and ranchers to address 
     environmental needs; adds air to the list of resources to be 
     addressed; and replaces the terms farmers and ranchers with 
     producers. (Section 231)
       The Senate amendment rewrites the purposes of the EQIP to 
     promote agricultural production and environmental quality as 
     compatible national goals and to: (1) assist producers in 
     complying with federal, state and local environmental laws, 
     (2) avoid the need for regulatory programs, (3) provide 
     assistance to producers for installing and maintaining 
     conservation systems, (4) assist producers in making certain 
     conservation changes, (5) facilitate partnerships between 
     producers, government and nongovernmental organizations, and 
     (6) consolidating and streamlining conservation planning; 
     retains language regarding a program goal to maximize the 
     environmental benefits per dollar expended; and includes air 
     in the purposes of the EQIP. (Section 213(a))
       The Conference substitute adopts the Senate provision on 
     the purposes of the program with a modification to subsection 
     (1) stating that the purposes of EQIP are to promote 
     agricultural production and environmental quality as 
     compatible goals and to optimize environmental benefits by 
     assisting producers in complying with local, state and 
     national regulatory requirements concerning soil, water, and 
     air quality, wildlife habitat, and surface and ground water 
     conservation. (Section 1240) (Section 2301)
       The Conference substitute adopts the Senate provision with 
     a modification changing the phrase conservation systems to 
     conservation practices. (Section 1240(3)) (Section 2301)
       The Managers expect the Secretary to continue carrying out 
     EQIP with the goal of optimizing environmental benefits. 
     (Section 213(a))
     (2) Definitions
       The House bill adds the term non-industrial private 
     forestland to the definition of eligible land. Further, the 
     House bill changes the definition of eligible land by 
     striking reference to land that poses a serious threat and 
     inserting that provides increased environmental benefits to 
     air, soil, water or related resources, and adds the term non-
     industrial private forestland to the definition of producer. 
     (Section 2302)
       The Senate amendment defines the term eligible land to 
     include private non-industrial private forestland, defines 
     producer with the same meaning given to the term in the 
     Agricultural Market Transition Act.
       The definition section includes definitions for: beginning 
     farmer and rancher, comprehensive nutrient management, 
     eligible land, innovative technology, land management 
     practice, livestock, maximize environmental benefits per 
     dollar expended, practice, producer and structural practice. 
     (Section 213(a))
       The Conference substitute adopts the Senate definition of 
     beginning farmer, land management practice, livestock, 
     structural practice, and practice. (Section 2301)
       The Conference substitute adopts the Senate definition of 
     eligible land with an amendment that adds air to the list of 
     protected resources but excludes specific threatening 
     conditions. (Section 2301)
       The Conference substitute deletes the Senate provisions 
     defining innovative technology and comprehensive nutrient 
     management plan. (Section 2301)
       The Conference substitute deletes the Senate provisions 
     defining managed grazing, innovative technology, producer, 
     and program. The substitute also deletes the Senate provision 
     defining the term ``maximize environmental benefits per 
     dollar expended,'' thus striking the provision throughout the 
     program. (Section 1240(A)(8)) (Section 2301)
     (3) Establishment and Administration
       The House bill re-authorizes the EQIP through 2011; amends 
     the permissible term of EQIP contracts to allow for 
     agreements ranging from one to ten years; amends language 
     governing the selection process for structural practice 
     applications. Strikes references to priorities established in 
     the EQIP and factors to maximize the environmental benefits 
     per dollar expended replaces with language directing 
     the Secretary to base the selection process on achieving 
     the purposes established under this subtitle; removes 
     prohibition on large confined livestock operations getting 
     cost-share assistance to build waste management 
     facilities; and replaces the language regarding incentive 
     payments with new language directing the Secretary to make 
     incentive payments to encourage producers to perform 
     multiple land management practices and to promote the 
     enhancement of soil, water, wildlife habitat, air and 
     related resources. Permits the Secretary to give great 
     weight to practices that include residue, nutrient, pest, 
     invasive species and air quality management. (Section 233)
       The Senate amendment reauthorizes the EQIP through 2006; 
     directs the Secretary to provide conservation education; 
     amends the permissible term of EQIP contracts to allow for 
     agreements ranging from three to ten years; prohibits a 
     producer from entering into more than one contract for 
     structural practices relating to livestock nutrient 
     management from fiscal years 2002 through 2006; directs the 
     Secretary to develop an application and evaluation process 
     for awarding assistance that maximizes the environmental 
     benefits per dollar expended; prohibits the Secretary from 
     assigning a higher priority to an application based solely on 
     the reason that it presents the least cost to the program; 
     cost-share payments shall not exceed 75 percent of the cost 
     of the practice; cost-

[[Page H1923]]

     share payments to limited resource and beginning farmers 
     shall not exceed 90%; removes prohibition on large confined 
     livestock operations getting cost-share assistance to build 
     waste management facilities; directs the Secretary to make 
     incentive payments in an amount and rate determined to be 
     necessary to encourage a producer to perform 1 or more 
     practices; directs the Secretary to give incentive payments 
     to producers to be used to obtain technical assistance 
     associated with the development of any component of a 
     comprehensive nutrient management plan from certified 
     providers. (Section 213(a)) (Section 2301)
       The Conference substitute adopts the Senate provision with 
     modification providing incentive payments for producers who 
     develop a comprehensive nutrient management plan. (Section 
     1240B(a)(2)) (Section 2301)
       The Conference substitute deletes the Senate provision on 
     education. (Section 1240B(a)(3)) (Section 2301)
       The Conference substitute adopts the Senate provision with 
     modification on the application and term of contracts. At a 
     minimum, the contract should have a term of one year beyond 
     the date of completion of the project. (Section 1240B(b)) 
     (Section 2301)
       The Conference substitute adopts the Senate provision on 
     incentive payments with modification, by including a special 
     rule for priority under incentive payments. (House Section 
     233(e)) (Section 2301)
       The Conference substitute adopts the House provision by 
     striking the provision on the application and evaluation 
     process for awarding assistance that maximizes the 
     environmental benefits per dollar expended. (House Section 
     233(c), Senate 213(a) (1240B(c))) (Section 2301)
       The Conference substitute adopts the Senate provision to 
     remove the bidding down procedure that assigns a higher 
     priority to an application because it costs less. (Section 
     1240B(c)(4)) (Section 2301)
       The Conference substitute adopts the Senate provision on 
     increased cost-share payments for beginning and limited 
     resource farmers. (Section 1240B(d)) (Section 2301)
       The Conference substitute adopts the House provision on 
     technical assistance in EQIP. All technical assistance will 
     be addressed in Subtitle E in the Administration and 
     Technical Assistance section. (Section 1240B(f)) (Section 
     2301)
     (4) Evaluation of Offers and Payments
       The House bill strikes existing language. Replaces with 
     language directing the Secretary to give a higher priority to 
     EQIP offers that: (1) aid producers in complying with federal 
     and state environmental laws, (2) promote the use of animal 
     manure or other similar soil amendments, and (3) encourage 
     the utilization of sustainable grazing systems. (Section 234)
       The Senate amendment directs the Secretary to give priority 
     to applications that: (1) maximize the environmental benefits 
     per dollar expended, (2) national conservation priority 
     areas, (3) are provided in conservation priority areas, (4) 
     are provided in special projects, or (5) include an 
     innovative technology in connection with a structural 
     practice or land management practice. (Section 213(a)) 
     (Section 2301)
       The Conference substitute adopts the Senate provision with 
     modification on giving higher priority to applications that 
     use cost-effective conservation practices and address 
     national conservation priorities. (Section 1240C(a)(2)) 
     (Section 2301)
       The Conference substitute deletes the Senate provision on 
     special projects and innovative technology. (Section 2301)
       Inhibitor Technology.--To make efficient use of urea and 
     ammonium fertilizers, reduce nitrate run-off and leaching, 
     and the emission of ammonia and greenhouse gases, the 
     incorporation of urease inhibitors and nitrification 
     inhibitors into urea and ammonium containing fertilizers 
     should be recommended as a best management practice.
       Nutrient Management.--Since enactment of the Food, 
     Agriculture, Conservation and Trade Act of 1990, Congress has 
     been concerned about the impact federal, state and local 
     environmental laws eventually would have on U.S. agricultural 
     producers and their ability to maintain viable farming and 
     ranching operations.
       In the past few years, those laws, regulations and court 
     orders have been focused on agriculture. Those provisions 
     reflect a disconnect between regulators and agricultural 
     producers as well as rural communities. In this posture, U.S. 
     farmers and ranchers feel as though they are pressed against 
     an inflexible wall of legal and environmental requirements. 
     These requirements are issued from Washington in a top-down 
     management style that attempts to fit all areas of the 
     country into a national program. Congress has responded with 
     financial and technical assistance implemented through the 
     USDA.
       In 1996, Congress created the EQIP to help farmers and 
     ranchers meet environmental laws. The Managers believe EQIP 
     is a valuable tool to help producers avoid the need for 
     future regulation, and the Secretary shall manage the program 
     to maximize this purpose. As legislation was developed to 
     improve EQIP and provide additional resources to it, Congress 
     was specifically concerned about how the U.S. livestock 
     industry would meet new Clean Water Act requirements on 
     animal feeding operations. In that regard, the Managers agree 
     that nutrient management, especially animal waste management, 
     is both a problem to address and a resource to be used. To 
     that extent, the Managers encourage the Secretary to evaluate 
     EQIP contract offers on their use of animal manures and other 
     similar soil amendments that improve soil health, tilth, 
     and water-holding capacity.
       Managed Grazing.--The Managers further encourage the use of 
     grazing systems, such as year-round, rotational or managed 
     grazing systems, that enhance productive livestock 
     operations.
     (5) Duties of Producers
       The Senate amendment requires producers to implement a 
     conservation plan; not conduct any practices that defeat the 
     purposes of the program; take actions upon termination of a 
     contract and supply information to determine compliance, and 
     submit a list of all confined livestock feeding operations 
     wholly or partially-owned or operated by the applicant. 
     (Section 213(a))
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     a modification removing the requirement to submit a list of 
     all confined livestock feeding operations wholly or 
     partially-owned or operated by the applicant. (Section 2301)
     (6) Environmental Quality Incentives Program Plan
       The House bill strikes language regarding practices and 
     principles that the Secretary deems necessary. Replaces with 
     language requiring the producer to submit a plan that 
     provides or will continue to provide increased environmental 
     benefits to air, soil, water or related resources. (Section 
     235)
       The Senate amendment requires a producer to submit an EQIP 
     plan that describes conservation and environmental purposes 
     to be achieved through 1 or more practices that are approved 
     by the Secretary. Confined livestock feeding operations with 
     an animal waste system must develop and implement 
     comprehensive nutrient management plans if applicable. 
     (Section 1240E(a))
       The Senate amendment requires the Secretary to eliminate 
     duplication, to the maximum extent practicable, of planning 
     activities under EQIP and other conservation programs. 
     (Section 1240E(b))
       The Conference substitute adopts the Senate provision with 
     modification. All livestock producers that receive funding 
     for animal waste manure systems must have a comprehensive 
     nutrient management plan. The Managers believe that there 
     will be few cases in which a comprehensive nutrient 
     management plan will not be required. The Managers recognize 
     the importance of comprehensive nutrient management plans for 
     the proper use and storage of animal waste and for that 
     reason require these plans. (Section 2301)
       The Conference substitute also adopts the Senate provision 
     on eliminating duplication. (Section 1240E(a), (b)) (Section 
     2301)
     (7) Duties of the Secretary
       The House bill requires the Secretary to provide technical 
     assistance and cost-share payments for developing structural 
     practices or land management practices. (Section 236)
       The Senate amendment requires the Secretary to provide 
     cost-share assistance and incentive payments for developing 
     and implementing one or more practices. (Section 213 (a) 
     (1240F)
       The Conference substitute adopts the Senate provision. 
     (Section 2301)
       The Managers are aware of the unique conservation and 
     production practices utilized by specialty crop growers 
     throughout the United States. The Managers expect the USDA to 
     ensure that adequate resources are made available for 
     specialty crop conservation practices under the EQIP. The 
     Managers also expect that, in carrying out the financial 
     assistance provisions of the various conservation programs, 
     the unique production practices involved in fruit and 
     vegetable production are taken into account when drafting and 
     implementing regulations to carry out those programs. In 
     particular, the Managers would direct the Secretary when 
     enrolling a producer who is already undertaking activities 
     related to integrated pest management, make those ongoing 
     activities eligible for financial assistance after the date 
     of enrollment.
     (8) Limitation on Payments
       The House bill raises the payment limits to $50,000 in any 
     fiscal year and $200,000 for any multi-fiscal year contract, 
     strikes reference to the phrase ``maximization of 
     environmental benefits per dollar expended'' in discussion of 
     exceptions to the annual limit, and strikes prohibition on 
     payment in the same fiscal year in which the contract is 
     entered into. (Section 237)
       The Senate amendment raises the payment limitations to 
     $30,000 in any fiscal year and $150,000 for any multi-year 
     contract of four or more years and permits payment during the 
     first year of the contract. The Secretary may waive the 
     annual limit. (Section 213 (a))
       The Conference substitute adopts the House provision with 
     modification. A producer may receive, directly or indirectly, 
     up to $450,000 in any combination of contracts over the life 
     of the farm bill. The Managers recognize that the Secretary 
     may need to adjust cost-share percentages provided under a 
     contract to maximize participation and optimize environmental 
     benefits. (Section 2301)
     (9) Ground and Surface Water Conservation
       The House bill replaces the entire section with a new 
     program within the EQIP providing cost-share, low-interest 
     loans and incentive payments to encourage ground and

[[Page H1924]]

     surface water conservation, and funds at $30 million in 
     fiscal year 2002, $45 million in fiscal year 2003 and $60 
     million for fiscal years 2004 through 2011. (Section 238)
       The Senate amendment has no comparable provision.
       The Conference substitute adopts the House provision with 
     modification. Water conservation activities that are eligible 
     for incentive payments and cost-share include the lining of 
     ditches and installation of piping, tail water return 
     systems, low-energy precision irrigation systems, low-flow 
     irrigation systems, off-stream and groundwater storage, and 
     conversion from gravity or flood irrigation to higher 
     efficiency systems. In addition, the Secretary may provide 
     cost-share and incentive payments under this section only if 
     the assistance will facilitate a conservation measure that 
     results in a net savings in ground or surface water resources 
     on the agricultural operations of the producers. (Section 
     2301)
       Of the $600 million in funding made available for this 
     program, the Secretary should make available $50 million per 
     year to assist producers in the Klamath Basin.
       In providing funding for water conservation incentives, the 
     Managers recognize that the High Plains Aquifer underlying 
     the states of Texas, New Mexico, Oklahoma, Kansas, Colorado, 
     South Dakota, Wyoming, and Nebraska is a critical source of 
     groundwater for agricultural and municipal uses. The Managers 
     encourage the Secretary to give producers in the High Plains 
     Aquifer the highest priority for funding under this program. 
     The communities on the High Plains depend on the Aquifer as 
     their major water supply. Due to the scope and significance 
     of this geological feature, there is a need for regional 
     efforts to address groundwater management in the High Plains 
     Aquifer. The Managers urge the Secretary to work with state 
     water or conservation agencies and agricultural producers in 
     the High Plains region to coordinate federal assistance with 
     state programs and to encourage cooperation between states in 
     implementing conservation incentives and water reduction 
     practices.
     (10) Desert Terminal Lakes
       The Conference substitute directs the Secretary to transfer 
     $200 million to the Bureau of Reclamation to be used to 
     provide water to at-risk natural desert terminal lakes. These 
     funds cannot be used for the purchase or lease of water 
     rights. (Section 2507)
     (11) Conservation Grants
       The Senate amendment allows the Secretary to use up to $100 
     million in each of fiscal years 2003 through 2006 for 
     competitive grants that are intended to stimulate innovative 
     approaches to leveraging federal investment in environmental 
     enhancement and protection through the use of the EQIP. Funds 
     not obligated by April 1st of the fiscal year shall be used 
     to carry out other activities under EQIP. (Section 213 (a) 
     (Section 1240H)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision by 
     authorizing the Secretary to provide innovation grants. The 
     Managers encourage the Secretary to allow funding for these 
     grants, including for practices that foster markets for 
     nutrient trading and for the continued implementation and 
     acceleration of programs for demonstrating innovative 
     nutrient management technology systems for animal feeding 
     operations. (Section 2301)
       This section has been included as a discretionary use of 
     EQIP funds to foster the adoption of innovative, cost 
     effective approaches to addressing a broad base of 
     conservation needs.
       This Managers intend that these grants be used to provide 
     for the use of incentives to farmers--as opposed to 
     regulations--to address some of the nation's most difficult 
     conservation needs. By establishing market-based incentives, 
     an efficient mechanism is created to improve water quality 
     and create environmentally beneficial income alternatives for 
     farmers.
       By leveraging Federal funds through competitive grants, the 
     Managers expect other sectors of the economy, such as States, 
     and the conservation and philanthropic communities will be 
     engaged in helping find and deliver the best solutions to 
     environmental needs.
     (12) Southern High Plains Aquifer Groundwater Conservation
       The Senate amendment creates a southern High Plains Aquifer 
     groundwater conservation program. Directs the Secretary to 
     provide cost-share payments, incentive payments and 
     groundwater education assistance to producers that draw water 
     from the southern High Plains Aquifer. Funds at $15 million 
     for fiscal year 2003, $25 million for fiscal years 2004 and 
     2005, $35 million for fiscal year 2006 and $0 for fiscal year 
     2007. Funds not expended by April 1st of each fiscal year 
     shall be made available for other states under EQIP. (Section 
     213(a) section 1240I)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision, but 
     recognizes the importance of providing producers access to 
     funds to aid their efforts in water conservation. (Section 
     2301)
     (13) Pilot Programs
       The Senate amendment creates a drinking water suppliers 
     pilot program in selected watersheds to allow the Secretary 
     to work cooperatively with local water utilities to improve 
     water quality. The Secretary shall also carry out a nutrient 
     reduction pilot program in the Chesapeake Bay watershed for 
     fiscal years 2003 through 2006 to reduce nutrient loads in 
     the Chesapeake Bay. Funds at $10 million for fiscal year 
     2003, $15 million for fiscal year 2004, $20 million for 
     fiscal year 2005, $25 million for fiscal year 2006 and $0 for 
     fiscal year 2007. Funds not obligated by April 1st shall be 
     made available under EQIP. (Section 213(a) (Section 1240J(a), 
     (b))
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision on 
     the drinking water suppliers pilot program. In so doing, the 
     Managers believe that coordination with third parties, 
     including drinking water suppliers should be encouraged. Any 
     projects which involve drinking water suppliers and EQIP 
     participants should encouraged. (Section 1240J(a)) (Section 
     2301)
       The Conference substitute deletes the Senate provision on 
     the nutrient reduction pilot program.
     (14) Section 11
       The Senate amendment amends Section 11 of the Commodity 
     Credit Corporation (CCC) Charter Act to exclude transfers and 
     allotments for conservation technical assistance from the 
     current limitation. (Section 213(c))
       The House bill contains no comparable provision.
       The Conference deletes the Senate provision. The Managers 
     understand the critical nature of providing adequate funding 
     for technical assistance. For that reason, technical 
     assistance should come from each individual program. (Section 
     2301)
     (15) Water Benefits Program
       The Senate amendment states that the Secretary shall 
     establish a Water Benefits Program, run through the Natural 
     Resources Conservation Service (NRCS), in Nevada, California, 
     New Mexico, Oregon, Washington, Maine and New Hampshire for 
     cost-share payments for practices, including irrigation 
     efficiency infrastructures and conversions from a water-
     intensive crop to a crop that requires less water, aimed at 
     conservation of water to benefit fish and wildlife, with 
     special emphasis on threatened and endangered species. 
     (Section 1240R)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.


                 Subtitle E--Funding And Administration

     (1) Reauthorization
       The House bill reauthorizes these programs through 2011. 
     (Section 241)
       The Senate amendment has no comparable provision.
       The Conference substitute reauthorizes the CCEP programs 
     through 2007. (Section 2701)
     (2) Funding
       The House bill funds EQIP at $1.025 billion in fiscal years 
     2002 and 2003, $1.2 billion in fiscal years 2004, 2005 and 
     2006, $1.4 billion in fiscal years 2007, 2008 and 2009, and 
     $1.5 billion fiscal years 2010 and 2011. (Section 242)
       The Senate amendment funds EQIP at $500 million in fiscal 
     year 2002, $1.3 billion in fiscal year 2003, $1.45 billion in 
     fiscal years 2004 and 2005, and $1.5 billion in fiscal year 
     2006 and $850 million in fiscal year 2007. (Section 213(b))
       The Conference substitute funds EQIP at $400 million in 
     fiscal year 2002, $700 million in fiscal year 2003, $1 
     billion in fiscal year 2004, $1.2 in fiscal years 2005 and 
     2006, and $1.3 billion in fiscal year 2007. (Section 2701)
     (3) Allocation for Livestock Production
       The House bill extends the allocation of 50 percent of the 
     EQIP funding to livestock through 2011. (Section 243)
       The Senate amendment removes the allocation formula.
       The Conference substitute adopts the House provision with 
     modification to allow 60 percent for practices related 
     livestock and 40 percent for practices related to crops 
     through fiscal year 2007. (Section 2701)
     (4) Administration and Technical Assistance
       The House bill broadens the exception to the acreage 
     limitation by striking the requirement that operators in the 
     county be having difficulties complying with a conservation 
     plan, and requires the Secretary to reevaluate the provision 
     of and amount of technical assistance made available under 
     CRP, WRP and EQIP. (Section 244)
       The Senate amendment has no comparable provision.
       The Conference substitute adopts the House provision with 
     modification. The Managers provide that funds for technical 
     assistance shall come directly from the mandatory money 
     provided for conservation programs under Subtitle D. (Section 
     2701)
       In order to ensure implementation, the Managers believe 
     that technical assistance must be an integral part of all 
     conservation programs authorized for mandatory funding. 
     Accordingly, the Managers have provided for the payment of 
     technical assistance from program accounts. The Managers 
     expect technical assistance for all conservation programs to 
     follow the model currently used for the EQIP whereby the 
     Secretary determines, on an annual basis, the amount of 
     funding for technical assistance. Furthermore, the Managers 
     intend that the funding will cover costs associated with 
     technical assistance, such as administrative and overhead 
     costs.
     (5) Third-Party Providers
       The House bill requires the Secretary to develop a system 
     for approving third-party

[[Page H1925]]

     providers to give technical assistance within six months of 
     the enactment of this subsection. (Section 244)
       The Senate amendment requires the Secretary to establish 
     provisions for increased technical assistance by nonfederal 
     providers, including certification of providers (without 
     undermining private certification organizations). The 
     Secretary may also enter cooperative agreements with state, 
     local and nongovernmental groups to provide technical 
     assistance. The Secretary shall require certification 
     (including payment of a fee) for providers of technical 
     assistance and offer waivers for both certification and fee 
     payment. The Secretary shall establish an advisory committee 
     with federal, state, local and private representatives 
     charged with advising the Secretary on third-party technical 
     assistance. (Section 204(f))
       The Conference substitute adopts the House provision with 
     modification. The Managers strongly encourage the Secretary 
     to design a certification program for approving individuals 
     and entities to provide technical assistance that includes 
     individuals currently providing technical assistance through 
     agreements or contracts, including cooperative agreements and 
     memorandums of understanding. Persons that have provided 
     technical assistance through a previous agreement such as a 
     memorandum of understanding contract or cooperative agreement 
     with the Secretary may continue to provide technical 
     assistance. Their certification should be evaluated according 
     to the criteria established by the regulations. In addition, 
     the Secretary may request the services of, and enter into a 
     cooperative agreement or a contract with, non-federal 
     entities, a state water quality agency, a state fish and 
     wildlife agency, a state forestry agency, a state 
     conservation agency or conservation district, a land grant 
     institution or other institutions of higher learning, or any 
     other governmental or non-governmental organization. (Section 
     2701)
       Today there is considerable interest in both the private 
     and public sectors to provide technical assistance for USDA 
     conservation programs. In the past, USDA has been the primary 
     provider of technical assistance to conservation program 
     participants. However, it will be difficult to meet the 
     increased demand for technical services as financial 
     assistance increases over the life of the farm bill. The 
     potential volume of many new, as well as returning, USDA 
     conservation program participants may overwhelm the 
     assistance available through existing resources. To meet this 
     demand, assistance from third-party providers will be needed.
       It is the intent of the Managers that the third-party 
     technical assistance certification program will result in a 
     pool of individuals and organizations and agencies that are 
     qualified to provide technical assistance to producers 
     related to the development and implementation of conservation 
     practices. The Managers intend for the Secretary to seek to 
     optimize the delivery of technical assistance through public 
     and private sources, and in conjunction with USDA staff, to 
     effectively, efficiently, and expeditiously deliver 
     conservation programs.
       The Managers intend that third-party vendors accepting 
     federal technical assistance payments will follow all the 
     applicable Federal laws. Furthermore, the Managers intend for 
     third parties to accept the appropriate liability for the 
     adequacy of their plans, practice designs, and 
     implementation procedures, and to comply with all 
     appropriate privacy and confidentiality requirements.
       It is the Managers intent in this section that third-party 
     private providers may certify that the technical assistance 
     meets USDA standards, but it is not intended as a 
     certification for approval of program payment.


                       Subtitle F--Other Programs

     (1) Private Grazing Land and Conservation Assistance
       The House bill adds sustainable grazing systems to the list 
     of activities eligible for assistance. (Section 251)
       The Senate amendment reauthorizes program to 2006. (Section 
     217 (Section 1240P))
       The Conference substitute adopts the Senate provision, with 
     a modification to remove the findings section. The substitute 
     reauthorizes the program through 2007. (Section 2501)
     (2) Wildlife Habitat Incentives Program
       The Senate amendment allows the Secretary to provide cost-
     share payments and technical assistance to landowners to 
     develop and enhance wildlife habitat. Funds the Wildlife 
     Habitat Incentive Program (WHIP) at $50 million in fiscal 
     year 2002, $225 million for fiscal year 2003, $275 million 
     for fiscal year 2004, $325 million for fiscal year 2005, $355 
     million for fiscal year 2006, and $50 million for fiscal year 
     2007. The amendment reserves at least 15 percent of funds for 
     projects to benefit endangered, threatened and sensitive 
     species, allows the Secretary to establish a pilot program 
     using up to 15 percent of the funds to enroll lands for at 
     least 15 years for essential habitat, and allows the 
     Secretary to provide grants to individuals or nonprofit 
     groups that lease public lands for enhancing wildlife 
     habitat, if the work on the public land if it directly 
     benefits private land. (Section 217)
       The House bill funds WHIP at $25 million in fiscal year 
     2002, $30 million in fiscal years 2003 and 2004, $35 million 
     in fiscal years 2005 and 2006, $40 million in fiscal year 
     2007, $45 million in fiscal years 2008 and 2009, and $50 
     million in fiscal years 2010 and 2011. (Section 252)
       The Conference substitute adopts the House amendment with 
     modification. Cost-share payments will be made to landowners 
     to develop upland wildlife, wetland wildlife, threatened and 
     endangered species, fish and other types of wildlife habitat. 
     Up to 15 percent of annual funds under this section may be 
     for increased cost-share payments to producers to protect and 
     restore essential plant and animal habitat using agreements 
     with a duration of at least 15 years. The Managers strongly 
     encourage the Secretary to continue using at least 15 percent 
     of funds for threatened and endangered species. (Section 
     2502)
       The Conference substitute funds the program as follows: $15 
     million for fiscal year 2002; $30 million for fiscal year 
     2003; $60 million for fiscal year 2004; $85 million for each 
     of fiscal years 2005 through 2007. (Section 2502)
       Where private lands adjoin public lands that are leased by 
     the same producer, the Secretary may provide WHIP assistance 
     if the conservation purpose directly benefits the adjacent 
     private lands.
     (3) Farmland Protection Program
       (a) Acreage and eligibility
       The House bill strikes the acreage limitation, and makes 
     agricultural land that contains historic or archaeological 
     resources eligible for enrollment. (Section 253)
       The Senate amendment strikes the Farmland Protection 
     Program (FPP) from the 1996 FAIR Act and moves to the 1985 
     Farm Bill, strikes the acreage limitation, expands the 
     definition of eligible land, and makes agricultural land that 
     contains historic or archaeological resources eligible for 
     enrollment. (Section 218)
       The Conference substitute adopts the Senate provision. 
     (Section 1238H(1)) (Section 2503)
       The Conference substitute adopts the Senate provision with 
     clarification that forested land can only be enrolled if it 
     is an incidental part of the agricultural operation. (Section 
     1238H(2)) (Section 2503)
       FPP has been a successful program and the Managers' intent 
     is that it continue to protect the nation's best working 
     agricultural lands. Although the name of the FPP shall remain 
     the same for the purpose of continuity, the purpose of the 
     program has been expanded to also include grazing, pasture, 
     range, and forestland that is a part of an agricultural 
     operation.
       In order to ensure that all states can participate in the 
     program, the Managers have added non-profit organizations as 
     eligible entities. In addition, the Managers recognize the 
     need to protect important historic and archaeological 
     resources located on farms and ranches.
       (b) Funding
       The House bill increases funding to $50 million per year in 
     FY 2002 through 2011. (Section 253)
       The Senate amendment increases FPP funding to $150 million 
     in fiscal year 2002, $250 million in fiscal year 2003; $400 
     million in fiscal year 2004, $450 million for fiscal year 
     2005, $500 million in fiscal year 2006, and $100 million for 
     fiscal year 2007. (Section 218)
       The Conference substitute funds the program as follows: $50 
     million for fiscal year 2002, $100 million for fiscal year 
     2003, $125 million for fiscal years 2004 and 2005, $100 
     million for fiscal year 2006, and $97 million for fiscal year 
     2007. (Section 2503)
       (c) Purchase of conservation easements
       The House bill clarifies entities that are eligible to 
     receive funding for the purchase of conservation easements. 
     (Section 253)
       The Senate amendment clarifies entities that are eligible 
     to receive funding for the purchase of conservation 
     easements. (Section 218)
       The Conference substitute adopts the Senate provision. 
     (Section 2503)
       The Managers expect the Secretary to utilize funds out of 
     the FPP to protect from development the farm operated by 
     American Airlines Captain John Ogonowski, the pilot of AA 
     Flight 11 that was hijacked on September 11, 2001. The 
     Managers direct the Secretary to work with the Dracut Land 
     Trust, Incorporated, in Dracut, Massachusetts, to preserve 
     this prime farmland as a working memorial to Captain 
     Ogonowski. The Managers understand that the Dracut Land Trust 
     would intend to keep a portion of the farm available for 
     the New Entry Sustainable Farming Project that assists 
     immigrant farmers from Cambodia, a project that Captain 
     Ogonowski was deeply involved with from its inception.
       (d) Market viability grants
       The Senate amendment allows the Secretary to use up to $10 
     million annually to provide matching market viability grants. 
     The grantee must provide matching funds, limits federal cost-
     share to 50 percent of the appraised fair market value of the 
     easement. (Section 218)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     modification allowing for authorization of funding for market 
     viability grants. (Section 218(b)) (Section 2503)
     (4) Resource Conservation and Development Program
       The House bill provides permanent authorization for the 
     Resource Conservation and Development (RC&D) program and 
     makes technical and conforming changes necessary to the 
     program. (Section 254)
       The Senate amendment provides permanent authorization for 
     the RC&D program

[[Page H1926]]

     and makes technical and conforming changes necessary to the 
     program. (Section 216)
       The Conference substitute adopts the Senate provision with 
     the modification that Senate amendment section 1532(e) will 
     be struck, thereby disallowing an RC&D Council from using 
     another person or entity to assist in developing and 
     implementing an area plan. (Section 2504)
     (5) Grassland Reserve Program
       (a) Establishment
       The House amendment establishes a Grasslands Reserve 
     Program (GRP) under which the Secretary may enroll up to 2 
     million acres (1 million acres of restored grassland, 1 
     million acres of virgin (never cultivated) grassland) using 
     ten, fifteen and twenty-year contracts as well as thirty-year 
     and permanent easements.
       The Senate amendment establishes a GRP under which the 
     Secretary may enroll up to 2 million acres of natural 
     grassland or land that was historically natural grassland 
     using thirty-year rental agreements, easements or permanent 
     easements.
       The Conference substitute adopts the House provision with 
     modification that the total number of acres shall not exceed 
     2 million acres of restored, improved, or natural grassland, 
     rangeland and pastureland, including prairie. The Secretary 
     shall enroll not less than 40 contiguous acres of land using 
     ten-year, fifteen-year, twenty-year and thirty-year contracts 
     as well as thirty-year and permanent easements. The Secretary 
     may provide a waiver for smaller tracts of land in the case 
     of exceptional acreage that meets the purposes of the 
     program. (Section 2401)
       The Managers expect the Secretary to use 40 percent of the 
     funds to conduct the sign-up and enrollment for the ten, 
     fifteen, and twenty-year GRP contracts in a manner similar to 
     the method currently used by the Secretary for the CRP. This 
     should allow for enrollment competition that will limit the 
     cost per acre but encourage the producer to maintain or 
     initiate sound grazing practices commonly used in the local 
     area. For long-term agreements and easements, the Managers 
     intend that the sign-up be conducted in a manner similar to 
     the WRP. The standards for grazing should be no more 
     stringent than those used in the CRP, the CSP or the FPP. All 
     grasslands should receive equitable treatment in the sign-up 
     and enrollment process.
       (b) Funding
       The House amendment provides $254 million in funding. Not 
     more than one-third of this money may be used to acquire 
     permanent easements.
       The Senate amendment directs that funding shall be provided 
     through the CCC.
       The Conference substitute adopts the House provision with 
     modification that 60 percent of this money may be used to 
     enter into thirty-year agreements and acquire thirty-year and 
     permanent easements. (Section 2401)
       (c) Eligible practices
       The House bill permits common grazing practices where 
     consistent with maintaining the viability of natural grass 
     and shrub species indigenous to that locality, allows for 
     haying, mowing or haying for seed production except during 
     the nesting season for birds in the local area which are in 
     significant decline or are conserved pursuant to state or 
     federal law as determined by NRCS. The bill also permits the 
     construction of firebreaks and fences. The House bill 
     prohibits the production of any agricultural commodity (other 
     than hay) and any other activity that would disturb the 
     surface of the land covered by the agreement.
       The Senate amendment permits common grazing practices where 
     consistent with maintaining the viability of natural grass, 
     shrub, forb and wildlife species indigenous to that locality 
     and allows for haying, mowing or haying for seed production 
     except during the nesting or brood-rearing season for birds 
     in the local area which are in significant as determined by 
     NRCS. It permits the construction of firebreaks and fences 
     and gives emphasis to support for native grassland and land 
     containing shrubs or forb, grazing operations, and plant and 
     animal bio-diversity under the threat of conversion. The 
     Senate amendment prohibits the production of any agricultural 
     commodity (other than hay) and any other activity that would 
     disturb the surface of the land covered by the agreement. The 
     Secretary together with the State technical committee shall 
     establish criteria for ranking applications, but shall 
     emphasize support for grazing operations, biodiversity and 
     lands under greatest threat of conversion.
       The Conference substitute adopts the House provision with 
     modification. (Section 2401)
       The Managers intend that the Secretary shall permit common 
     grazing practices. In permitting such activities, the 
     Managers intend that the Secretary will allow for maintenance 
     and necessary cultural practices common to grazing systems 
     utilized throughout the various regions of the country. These 
     management practices may include such things as: controlled 
     burning, aeration, over-seeding, reseeding, planting of new 
     native species or any other practice as determined by the 
     Secretary to be necessary for grazing management. Beyond 
     maintenance, the Managers intend that the Secretary will 
     permit haying, mowing, or harvesting for seed production, 
     subject to appropriate restrictions for completion of the 
     nesting season for birds in the local area which are in 
     significant decline or are conserved pursuant to state or 
     federal law, as determined by the NRCS state conservationist.
       (d) Payments
       The House amendment directs that contract payments shall be 
     made annually in an amount that is not more than 75 percent 
     of the grazing value of the land. Easement payments may be 
     made as a single payment or a series of annual payments. In 
     the case of a permanent easement, the payment shall be equal 
     to the fair market value of the land less the grazing 
     value of the land encumbered by the easement. With respect 
     to a thirty-year easement, the payment shall be equal to 
     30 percent of the fair market value of the land less the 
     grazing value of the land for the period that the land is 
     encumbered by the easement. In addition to incentive 
     payments, the Secretary is authorized to provide cost-
     share assistance for restoration projects. In the case of 
     virgin grassland, these payments may not exceed 90 percent 
     of the restoration costs. With respect to restored 
     grasslands, these payments may not exceed 75 percent of 
     such costs. (Section 255)
       The Senate amendment establishes payments for permanent 
     easements that shall equal the fair market value of the land 
     less the grazing value and for 30-year easements, 30% of the 
     fair market value of the land less the grazing value. 30-year 
     rental agreements shall be equal, to the maximum extent 
     possible, to the payment for 30-year easements. The Secretary 
     shall provide up to 75% of cost-share for restoration of 
     grassland. The Secretary may permit an eligible private 
     organization or state agency to hold and enforce an easement. 
     (Section 219)
       The Conference substitute adopts the House provision with 
     modification to use the Senate formula for thirty-year 
     agreements as well as thirty-year and permanent easements. 
     (Section 2401)
     (6) Farmland Stewardship Program
       The House bill establishes a new program to use federal 
     conservation programs in conjunction and cooperation with 
     state and local conservation efforts, and enables the 
     Secretary to implement or combine together the features of 
     the WRP, WHIP, FPP, the new Forest Land Enhancement Program 
     (FLEP) or other conservation programs where feasible. 
     (Section 256)
       The Senate amendment has no comparable provision.
       The Conference substitute deletes the House provision. 
     (Section 2502)
     (7) Small Watershed Rehabilitation Program
       The House bill authorizes appropriations to fund the 
     program at $15 million annually for fiscal year 2002 and each 
     succeeding fiscal year. (Section 257)
       The Senate amendment has no comparable provision.
       The Conference substitute adopts the House provision, 
     providing $275 million over the length of this legislation 
     and reauthorizes the program. (Section 2505)
     (8) Provision of Assistance For Repaupo Creek Tide Gate and 
         Dike Restoration Project, New Jersey
       The House bill directs the Secretary, acting through NRCS, 
     to provide assistance for planning and implementation of the 
     Repaupo Creek Tide Gate and Dike Restoration Project. 
     (Section 258)
       The Senate amendment has no comparable provision.
       The Conference substitute deletes the House provision. 
     (Section 2501)
     (9) Conservation Corridor Demonstration Program
       The Conference substitute adopts a new provision not 
     contained in either bill that requires the Secretary of 
     Agriculture to establish a conservation corridor 
     demonstration program on the Delmarva Peninsula in the states 
     of Delaware, Maryland and Virginia located on the east side 
     of the Chesapeake Bay. A state, local government or 
     combination of states must submit a plan and commit resources 
     in order to participate in the program that is designed to 
     demonstrate local conservation and economic cooperation using 
     existing agriculture and forestry conservation programs of 
     the Department of Agriculture.
       The Managers intend that this new program may use only 
     conservation program funds for which they are authorized and 
     annually appropriated by the Congress.


                       Subtitle G--Miscellaneous

     (1) Grassroots Source Water Protection Program
       The Senate amendment authorizes $5 million annually from 
     fiscal years 2002 to 2006 for a national grassroots water 
     protection program to more effectively use technical 
     capabilities of each state rural water association that 
     operates a well-head or groundwater protection program. 
     (Section 217 (Section 1240Q))
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision.
     (2) Underserved States
       The Conference substitute adopts a provision adding $10 
     million per year for USDA's Agriculture Management Assistance 
     Program for fiscal years 2003 through 2007. The program 
     assists states found by USDA to be under-served in the 
     Agricultural Risk Protection Act of 2000.
     (3) Organic Agriculture Research Trust Fund
       The Senate amendment establishes an Organic Agriculture 
     Research Trust Fund.

[[Page H1927]]

       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     funding of $3 million a year through the life of the bill. 
     (Section 231)
     (4) Establishment of National Organic Research Endowment 
         Institute
       The Senate amendment states that the Secretary shall 
     establish a National Organic Research Endowment Institute.
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (5) Allocation of Conservation Funds by State
       The Senate amendment states that the Secretary shall, to 
     the maximum extent possible, provide each state with a 
     minimum of $12 million annually from conservation programs. 
     Each state shall be provided $5 million from EQIP and a 
     minimum of $7 million from other conservation programs 
     administered by the Secretary. Any funds not obligated under 
     this provision by April 1 of the fiscal year shall be 
     available to carry out activities under Subtitle D. (Section 
     241)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     modification. Before April 1 of each fiscal year, priority 
     for funding for conservation programs, excluding CRP, CSP and 
     WRP, shall be given to approved applications in any state 
     that has not received cumulative conservation funding for the 
     fiscal year of at least $12 million. The Managers 
     understand that only participants who qualify under the 
     individual program from which funds will be provided shall 
     be eligible to receive this priority under this program.
     (6) Watershed Risk Reduction
       The Senate amendment states that the Secretary, acting 
     through NRCS, shall cooperate with landowners and land users 
     to conduct projects (including the purchase of flood plain 
     easements) to safeguard lives and property from floods, 
     drought, and the products of erosion on any watershed. 
     Priority shall be given to any project or activity that is 
     carried out on a flood plain adjacent to a major river and 
     there is authorized to be appropriate $15 million for each of 
     fiscal years 2002 through 2006. (Section 217 (Section 1240N))
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (7) Great Lakes Basin Program For Soil Erosion and Sediment 
         Control
       The Senate amendment authorizes the Secretary of 
     Agriculture, in consultation with the Great Lakes Commission, 
     and in cooperation with the Administrator of the 
     Environmental Protection Agency and the Secretary of the Army 
     to carry out a program in the Great Lakes basin for soil 
     erosion and sediment control. There is an authorization of 
     appropriations of $5 million for each of the fiscal years 
     2002 through 2006. (Sec. 12400)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate amendment.
     (8) Cranberry Acreage Reserve Program
       The Senate amendment states that the Secretary shall 
     establish a program to purchase permanent easements on 
     wetlands or buffer strips adjacent to a wetland that is 
     environmentally sensitive and has or is used for cultivation 
     of cranberries. The purchase price should reflect the range 
     of values for agricultural and non-agricultural lands. The 
     section authorizes appropriations of $10 million. (Section 
     261)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision and 
     moves the item to the Miscellaneous Title of this 
     legislation.
     (9) Klamath Basin
       The Senate amendment provides that the Secretary shall, in 
     coordination with the Secretary of the Interior, establish 
     the Klamath Basin Interagency Task Force composed of relevant 
     federal agencies to use conservation programs to address the 
     environmental and agricultural needs of the Klamath Basin. 
     (Section 262)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision, 
     however, funding is provided to assist producers in the 
     Klamath Basin under the new section 1240I, Ground and Surface 
     Water Conservation.
       The Managers encourage the U.S. Department of Agriculture 
     to make full use of specific funding of $50,000,000 for the 
     Klamath Basin contained in the new water conservation program 
     to help farmers and ranchers with cost-share assistance, 
     incentive payments and technical assistance.
     (10) State Technical Committees
       The Senate amendment expands and updates membership of 
     State Technical Committee to include NRCS (instead of the 
     Soil Conservation Service) as chair, Farm Service Agency, 
     land grant colleges and universities, and forestry experts. 
     (Section 1261)
       The House bill contains no comparable provision
       The Conference substitute deletes the Senate provision.
       The Managers strongly encourage updating the involvement of 
     interested experts, including those with expertise in 
     forestry and land grant colleges. Also, the Managers are 
     concerned about reports that in some states, members of state 
     technical committees are not fully included. The Managers 
     strongly encourage the Secretary to ensure that chairpersons 
     of the committee strive to increase involvement.


                          Subtitle H--Repeals

     (1) Provisions of the Food Security Act of 1985
       The House bill repeals various authorities including the 
     wetlands mitigation-banking program (1222(k)), environmental 
     easement program (chapter 3 of subtitle D), conservation farm 
     option (chapter 5 of subtitle D) and tree planting initiative 
     (1256). Repeals various provisions of the CRP and WRP. 
     (Section 261)
       The Senate amendment has no comparable provision.
       The Conference substitute deletes the House provision.
     (2) National Natural Resources Conservation Foundation Act
       The House bill repeals subtitle F of Title III of the 1996 
     FAIR Act. (Section 262)
       The Senate amendment permits the Secretary to authorize the 
     Foundation to use, license or transfer symbols, slogans and 
     logos of the Department. Requires that all revenues be 
     transferred to NRCS account to carry out conservation 
     operations. (Section 221)
       The Conference substitute adopts the Senate provision with 
     a modification to authorize the Foundation to license logos 
     of the Foundation and explicitly prohibits the licensing of 
     any symbol or logo of a government entity. (Section 2506)

                            Title III--Trade

     (1) Market Access Program
       The House bill reauthorizes the Market Access Program 
     through 2011 and increases funding to $200 million. (Section 
     301)
       The Senate amendment reauthorizes MAP through 2006, and 
     increases MAP funding to: $100 million in 2002, $120 million 
     in 2003, $140 million in 2004, $180 million in 2005, and $200 
     million in 2006. It also establishes priority for new program 
     participants and programs in emerging markets for amounts 
     above $90 million and authorizes the new Quality Export 
     Initiative to identify high quality U.S. agricultural 
     products. This initiative will be subject to appropriations. 
     (Section 322)
       The Conference substitute adopts the Senate provision on 
     reauthorization through 2007, at the following annual funding 
     levels: $100 million in 2002, $110 million in 2003, $125 
     million in 2004, $140 million in 2005, and $200 million in 
     2006 and subsequent years. It establishes that proposals 
     submitted by new program participants and programs in 
     emerging markets shall receive consideration equal to that 
     given to current program participants for new funds made 
     available. It includes no provision dealing with the Quality 
     Export Initiative program. (Section 3103)
     (2) Food for Progress
       The House bill includes the following: reauthorizes Food 
     for Progress through 2011; increases the limits on Commodity 
     Credit Corporation funding for administrative costs to $15 
     million; increases the limits on Commodity Credit Corporation 
     funding for transportation costs related to distribution of 
     commodities to $40 million; excludes from the limitations on 
     tonnage in Section 1110(g) of Food for Progress those 
     commodities furnished on a grant basis or on credit terms 
     under title I of the Agricultural Trade Development Act of 
     1954; increases limits on amounts of commodities to 1,000,000 
     metric tons; encourages the President to approve agreements 
     that provide commodities to be made available for 
     distribution or sale on a multi-year basis; allows for the 
     use of U.S. dollars and other currencies for the monetization 
     of commodities by authorizing the President to use 
     ``proceeds''; adds a new provision that encourages the 
     Secretary to finalize program agreements and requests before 
     the beginning of the relevant fiscal year; and requires the 
     Secretary to provide the House Committee on Agriculture, 
     House Committee on International Relations and the Senate 
     Committee on Agriculture, Nutrition and Forestry a list of 
     approved programs, countries and commodities, and the total 
     amounts of funds approved for transportation and 
     administrative costs related to Food for Progress by November 
     1 of the relevant fiscal year. (Section 302)
       The Senate amendment includes the following: rewrites Food 
     for Progress as a new Title VIII of the 1978 Agricultural 
     Trade Act called ``Food for Progress and Education 
     Programs,'' authorized through 2006; permits USDA to provide 
     agricultural commodities to support introduction or expansion 
     of free trade enterprises in recipient country economies; 
     defines eligible commodities as ``agricultural commodities 
     (including vitamins and minerals) acquired by the Secretary 
     or the Corporation for disposition in a program authorized 
     under this title''; provides that not more than $55 million 
     of the funds made available may be used to cover non-
     commodity costs, of which not more than $12 million may be 
     used to cover administrative costs; establishes a 400,000 MT 
     minimum tonnage per year for the program; allows multi-year 
     PVO agreements and certified institutional partners status 
     for PVO's; allows monetization in U.S. dollars; encourages 
     timely and streamlined approval programs; directs the 
     Secretary to make program announcements before the beginning 
     of the fiscal year; requires eligible organizations with 
     agreements under this title to submit reports to the 
     Secretary containing such information as is required relating 
     to the use of

[[Page H1928]]

     commodities and funds provided for said agreements; requires 
     that assistance under this title shall be coordinated with 
     other forms of foreign assistance under the mechanism 
     designated by the President; requires the Secretary to ensure 
     that each eligible organization is optimizing the use of 
     donated commodities, as follows: (1) taking into account the 
     needs of target populations in recipient countries; (2) 
     working with recipient countries and institutions or groups 
     within those countries to design mutually acceptable 
     programs; (3) monitor and report on distribution and sale of 
     eligible commodities using accurate and timely reporting 
     methods; (4) periodically evaluate the eligible 
     organization's program effectiveness; and (5) consider means 
     of improving program operation.
       Agricultural commodities shall be made available under this 
     title without regard to political, geographic, ethnic, or 
     religious identity of the recipient. The Secretary is barred 
     from providing commodities under any agreement that requires 
     or permits the distribution or handling of those commodities 
     by any military forces, except when non-military channels are 
     not available and the Secretary deems that conditions require 
     such distributions occur.
       The Senate amendment also authorizes the appropriation of 
     such sums as may be necessary to carry out the title, plus 
     permits the use of P.L. 480 Title I funds; Provides that all 
     commodities related expenses must be in addition to any other 
     P.L. 480 assistance. (Section 325)
       The Conference substitute adopts the House bill provisions 
     in the following areas: (1) the program is reauthorized 
     through 2007; (2) an exclusion from the limitation on tonnage 
     for those commodities furnished on a grant basis or on credit 
     terms under title I; (3) encouragement of the President to 
     finalize agreements before the beginning of the relevant 
     fiscal year, and provision by the President to the relevant 
     Committees a list of approved programs, countries, and 
     commodities by December 1 of the relevant fiscal year; (4) 
     definition of eligible commodities, and (5) funding levels 
     for the program, both for non-commodity costs and 
     administrative expenses.
       The Conference substitute adopts the following House 
     provisions with modifications. The President was encouraged 
     to approve agreements on a multi-year basis; the provision 
     was expanded to include all eligible organizations rather 
     than just PVO's and to encourage multi-country agreements as 
     well, subject to the availability of commodities.
       The Conference substitute adopts the Senate provisions on 
     monetization of commodities in U.S. dollars, on minimum 
     tonnage. In recognition of the Senate provision on certified 
     institutional partners, the Conference substitute adopts 
     language to streamline, improve and clarify the application, 
     approval, and implementation processes pertaining to 
     agreements under the Food for Progress program. It also 
     requires the Department to undertake consultation with the 
     relevant Congressional Committees within one year of 
     enactment of the Act on the Department's progress in 
     achieving streamlining. Unlike the certified institutional 
     partners provisions, the streamlining provisions will apply 
     equally to all eligible organizations, whether or not they 
     have previously participated in the program.
       The Conference substitute amends the existing Food for 
     Progress Act of 1985, rather than establishes a new Title 
     VIII of the Agricultural Trade Act of 1978. Out of the Senate 
     amendment, it incorporates a definition section in the 
     statute, establishes quality assurance requirements, and 
     requires the President to ensure that each eligible 
     organization is optimizing the use of donated commodities, as 
     follows: (1) taking into account the needs of target 
     populations in recipient countries; (2) working with 
     recipient countries and institutions or groups within those 
     countries to design mutually acceptable programs; (3) monitor 
     and report on distribution and sale of eligible commodities 
     using accurate and timely reporting methods; and (4) 
     periodically evaluate the eligible organization's program 
     effectiveness. It also establishes the purposes of the 
     program. (Section 3106)
       The Managers are aware of the Food Aid Review conducted by 
     the Administration, which is a continuing process of review 
     of all foreign food aid programs. The Administration plans to 
     make several changes beginning in FY 2003, which include USDA 
     administering all government-to-government programs as a 
     result of funding Food for Progress programs through Title I 
     and USAID administering most private voluntary programs 
     through Title II.
       Under the current Food for Progress statute, eligible 
     organizations include private voluntary organizations, 
     cooperatives, other non-governmental and intergovernmental 
     organizations, as well as foreign governments. In providing 
     additional resources and establishing a minimum tonnage 
     requirement for the Food for Progress program under this 
     section, the Managers wish to see the program accessible to 
     all eligible organizations submitting proposals. The 
     Administration's ongoing food aid review should take this 
     into consideration. In many circumstances, the institutional 
     experience of private voluntary organizations and other 
     organizations may be crucial in determining the success or 
     failure of projects in emerging markets under the Food for 
     Progress program.
     (3) Surplus Commodities for Developing or Friendly Countries
       The House bill authorizes the use of U.S. dollars and other 
     currencies for the monetization of commodities and requires 
     the Secretary to publish in the Federal Register by October 
     31 of each fiscal year an estimate of the total commodities 
     available under this section for that fiscal year and 
     encourages the Secretary to finalize agreements by Dec. 31. 
     (Section 303)
       The Senate amendment authorizes the use of U.S. dollars and 
     other currencies for the monetization of commodities, strikes 
     subparagraph 416(b)(8)(A), allows direct delivery of 
     commodities to milling or processing facilities in recipient 
     countries, with proceeds of transactions going to eligible 
     organizations to carry out the approved project, permits 
     PVO's to apply to become certified institutional partners, 
     and provides that PVO's may submit multi-country proposals. 
     (Section 334)
       The Conference substitute adopts the House provision with 
     respect to monetization and requiring the Secretary to report 
     by October 31 the commodities available under this section 
     for that fiscal year. The Conference substitute adopts the 
     Senate provision with respect to encouraging submission of 
     multi-country proposals, expanded to include all eligible 
     organizations rather than just PVO's, and to encourage multi-
     year agreements as well, subject to the availability of 
     commodities. The conference substitute omits the Senate 
     provision on direct delivery of commodities.
       The Conference substitute also adopts the Senate provision 
     on certified institutional partners, with the following 
     changes: within 270 days, the Secretary shall review and, as 
     necessary, make changes in regulations and internal 
     procedures designed to streamline, improve, and clarify the 
     application, approval, and implementation processes 
     pertaining to agreements under Section 416(b). It also 
     requires the Secretary to undertake consultation with the 
     relevant Congressional Committees within one year of 
     enactment of the Act on the Secretary's progress in achieving 
     streamlining. These new procedures will apply equally to all 
     eligible organizations, whether or not they have previously 
     participated in the program. (Section 3201)
       The Managers believe that the use of donated American 
     agricultural commodities to support rural electrification 
     overseas is a highly appropriate use of surplus commodity 
     monetization, particularly where the USDA's own rural 
     electrification expertise can be added to the on-going 
     efforts of American electric cooperatives to ``export'' the 
     successful rural electrification model that was established 
     with the Rural Electrification Administration. The Conferees 
     encourage the Secretary of Agriculture to direct a more 
     aggressive rural electrification development effort as part 
     of USDA's monetization programs under section 416(b) of the 
     Agricultural Act of 1949, including collaboration with other 
     international development agencies in leveraging funds to 
     build on the successful experience of American electric co-op 
     projects in less developed countries.
     (4) Export Enhancement Program
       The House bill extends the Export Enhancement Act through 
     2011 at the current funding level. (Section 304)
       The Senate amendment extends the Export Enhancement Act 
     through 2006 at the current funding level and expands 
     definition of unfair trade practices to include (1) pricing 
     practices by an exporting state trading enterprise that ``are 
     not consistent with sound commercial practices conducted in 
     the ordinary course of trade,'' or (2) changing U.S. ``export 
     terms of trade through a deliberate change in the dollar 
     exchange rate of a competing exporter.'' (Section 323)
       The Conference substitute adopts the House provision with 
     respect to reauthorization of the program through 2007. The 
     Conference substitute adopts the Senate provision on unfair 
     trade practices, with the following changes: amends paragraph 
     (2) to clarify the type of state trading enterprise covered 
     by this definition, drops the exchange rate reference, and 
     inserts the following list of activities: subsidies that 
     decrease market opportunities for United States exports or 
     unfairly distort agricultural markets to the detriment of the 
     United States; unjustified trade restrictions or commercial 
     requirements, such as labeling, that affect new technologies, 
     including biotechnology; unjustified sanitary or 
     phytosanitary restrictions, including those not based on 
     scientific principles in contravention of the Uruguay Round 
     Agreements; other unjustified technical barriers to trade; 
     rules that unfairly restrict imports of United States 
     agricultural products in the administration of tariff rate 
     quotas; and the failure of a country to adhere to the 
     provision of already existing trade agreements with the 
     United States or by the circumvention by that country of its 
     obligations under those agreements. (Section 3104)
     (5) Foreign Market Development Cooperator Program
       The House bill includes the following: reauthorizes the 
     Foreign Market Development Cooperator Program through 2011; 
     authorizes such sums as may be necessary to carry out this 
     title, and in addition to any sums appropriated, authorizes 
     $37 million from the Commodity Credit Corporation for each of 
     fiscal years 2002 through 2011 to carry out the program; 
     directs the Secretary to carry out the Foreign Market 
     Development Cooperator

[[Page H1929]]

     Program with a significant emphasis on the importance of 
     exporting value-added agricultural products to emerging 
     markets; specifies that the Secretary shall report to the 
     House Committees on Agriculture and International Relations, 
     and the Committees on Agriculture, Nutrition and Forestry and 
     Foreign Relations of the Senate, on the funding and success 
     of the Foreign Market Development Cooperator Program. 
     (Section 305)
       The Senate amendment contains the following: reauthorizes 
     Foreign Market Development Cooperator Program through 2006; 
     authorizes, from the Commodity Credit Corporation: $37.5 
     million for 2002, $40 million for 2003, and $42.5 million for 
     2004, 2005 and 2006; establishes priority for new program 
     participants and programs in emerging markets for amounts 
     above $35 million. (Section 324)
       The Conference substitute adopts the Senate provision on 
     reauthorizing the program through 2007, and establishes that 
     proposals submitted by new program participants and programs 
     in emerging markets shall receive consideration equal to that 
     given to current program participants for additional funds 
     made available. The substitute authorizes, from the Commodity 
     Credit Corporation, $34.5 million for each fiscal year 
     between 2002 and fiscal year 2007.
       The Conference substitute adopts the House provision with 
     respect to a significant emphasis on value-added products, 
     with clarification that the emphasis required is a `continued 
     significant emphasis', to recognize that USDA already places 
     a significant emphasis on value-added, accounting for about 
     one-third of the program. It also requires a report on 
     funding and success of the Foreign Market Development 
     Cooperator Program to the relevant Congressional Committees. 
     (Section 3105)
     (6) Export Credit Guarantee Program
       The House bill reauthorizes the Export Credit Guarantee 
     Program through 2011, and continues for fiscal years 2002 
     through 2011 the current requirement that not less than 35 
     percent of the export credit guarantees issued be used to 
     promote the export of processed or high-value agricultural 
     products. (Section 306)
       The Senate amendment reauthorizes Export Credit Guarantee 
     Program through 2006, continues for fiscal years 2002 through 
     2006 the current requirement that not less than 35 percent of 
     the export credit guarantees issued be used to promote the 
     export of processed or high-value agricultural products; 
     extends terms of repayment for the supplier credit guarantee 
     program from 180 days to 12 months, and requires Secretary to 
     provide a report, one year after enactment of the law, on the 
     status of multilateral export credit negotiations at the WTO 
     and OECD. (Section 321)
       The Conference substitute adopts the Senate provision and 
     reauthorizes the program through 2007. It changes the 
     subsection that requires the Secretary to provide a report on 
     multilateral export credit negotiations to requiring the 
     Secretary and the United States Trade Representative to 
     regularly consult with the relevant House and Senate 
     Committees on that issue. The substitute also changes the new 
     terms of repayment for the supplier credit guarantee program 
     from 12 months to 360 days, if an authorization of 
     appropriations to fund loan terms greater than current length 
     of 180 days is provided. (Section 3102)
     (7) Food for Peace Program and the International Food Relief 
         Partnership Act
       The House bill reauthorizes the Food for Peace Program and 
     the International Food Relief Partnership Act through 2011, 
     and adds conflict prevention as a program objective. (Section 
     307)
       The Senate amendment reauthorizes the Food for Peace 
     Program and the International Food Relief Partnership Act 
     through 2006, and adds conflict prevention as a program 
     objective. (Section 311)
       The Conference substitute adopts the House provision, 
     reauthorizing the program through 2007. Program approvals 
     should be based on the potential benefits of the program on 
     food security and the choice of the appropriate commodity for 
     the intended use. (Section 3011)
     (8) Non-emergency Assistance
       The Senate amendment adds a new provision under ``(b) 
     Nonemergency Assistance'' requiring the Administrator to 
     foster program diversity by encouraging eligible 
     organizations to propose and implement plans that address 1 
     or more aspects of Food for Peace and incorporate a variety 
     of program objectives to assist development in foreign 
     countries. (Section 302)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision, with 
     an amendment clarifying that plans shall address program 
     objectives specified in Section 201 of the Agricultural 
     Trade, Development and Assistance Act of 1954. (Section 3002)
     (9) Funding
       The House bill provides that the funding for 
     transportation, storage and handling of P.L. 480 commodities 
     shall be not less than 5 percent and not more than 10 percent 
     of the funds made available under title II in each fiscal 
     year. (Section 307)
       The Senate amendment provides that the funding for 
     transportation, storage and handling of P.L. 480 commodities 
     shall be not less than 5 percent and not more than 10 percent 
     of the funds made available under title II in each fiscal 
     year. (Section 302)
       The Conference substitute adopts the Senate provision. 
     (Section 3002)
     (10) Private Voluntary Organization Authority (PVO)
       The House bill grants PVO's authority to submit multi-
     country proposals. (Section 307)
       The Senate amendment grants PVO's authority to submit 
     multi-country proposals. Also requires US-AID or USDA, as 
     applicable, to establish a process enabling PVO's and 
     cooperatives that can demonstrate their capacity to carry out 
     the programs, to qualify as ``certified institutional 
     partners,'' which would entitle them to use streamlined 
     application procedures, including expedited review, to 
     receive commodities. (Section 302)
       The Conference substitute adopts the House provision with 
     the following changes: the inclusion of all eligible 
     organizations rather than just PVO's and to encourage multi-
     year agreements as well.
       The Conference substitute also adopts the Senate provision 
     with the following changes: within one year after enactment 
     of this Act, requires the Administrator to establish 
     streamlined guidelines and application procedures for 
     programs under Title II, to be effective for fiscal year 
     2004, to the maximum extent practicable, for resource 
     allocation for existing projects and for new project 
     proposals. It also requires US-AID to undertake stakeholder 
     consultation using statutory procedures, as well as 
     consultation with the relevant Congressional Committees, 
     within six months of enactment, on the Agency's progress in 
     achieving streamlining. A report is to be submitted within 
     270 days on progress achieved in modernizing US-AID's 
     information management, procurement, and financial management 
     systems to accommodate Title II needs. (Section 3002)
     (11) Use of U.S. Dollars
       The House bill allows PVO's to use U.S. dollars when 
     monetizing commodities in foreign countries. (Section 307)
       The Senate amendment allows the use of U.S. dollars when 
     monetization is done in foreign countries. (Section 303)
       The Conference substitute adopts the Senate provision on 
     permitting eligible organizations to monetize commodities in 
     U.S. dollars in foreign countries. (Section 3003)
     (12) Minimum Level of Commodities
       The House bill increases the minimum level of commodities 
     available to 2,250,000 metric tons. (Section 307)
       The Senate amendment increases the minimum level of 
     commodities available from 2,025,000 MT to: 2,100,000 metric 
     tons for 2002; 2,200,000 metric tons for 2003; 2,300,000 
     metric tons for 2004; 2,400,000 metric tons for 2005; and 
     2,500,000 metric tons for 2006. It also adds crude degummed 
     soybean oil to list of value-added commodities under Title 
     II. (Section 304)
       The Conference substitute adopts the House provision, with 
     a change to 2,500,000 metric tons per year as the minimum 
     level of commodities beginning in fiscal year 2002.
       The Conference substitute adopts a new provision, changing 
     the sub-minimum requirement for non-emergency programs to 
     1,875,000 tons annually (Section 3004)
       The Managers ask the Administrator to examine the 
     commodities currently shipped under Title II non-emergency 
     programs, and determine which ones qualify as value-added 
     products to satisfy the sub-minimum requirement under Section 
     204(b) of the Agricultural Trade Development and Assistance 
     Act of 1954 (7 U.S.C. 1724).
     (13) Food Aid Consultative Group
       The House bill reauthorizes the food aid consultative group 
     through 2011. (Section 307)
       The Senate amendment reauthorizes the food aid consultative 
     group through 2006. (Section 305)
       The Conference substitute adopts the House provision, 
     reauthorizing the consultative group through 2007. (Section 
     3005)
     (14) Title II Spending
       The House bill eliminates the $1 billion cap on spending 
     for Title II. (Section 307)
       The Senate amendment raises the cap on Title II spending 
     from $1 billion to $2 billion annually. (Section 306)
       The Conference substitute adopts the House provision. 
     (Section 3006)
     (15) Duties of the Administrator of US-AID
       The House bill requires that the Administrator of US-AID 
     make decisions on program proposals, received from PVO's, not 
     later than 120 days after receipt. (Section 307)
       The Senate amendment requires that the Administrator of US-
     AID make decisions on program proposals, received from PVO's, 
     not later than 120 days after receipt, requires the 
     Administrator to treat proposed policy determinations the 
     same as guidelines, and allows direct delivery of commodities 
     to milling or processing facilities in recipient countries, 
     with proceeds of transactions going to eligible organizations 
     to carry out the approved project. (Section 307)
       The Conference substitute adopts the Senate provision, with 
     the technical change that the 120 day period begins after 
     submission of the proposal to the Administrator rather than 
     receipt of the proposal by the Administrator, and that to the 
     maximum extent practicable, the Administrator is encouraged 
     to make decisions on program proposals within that period. 
     The annual policy guidance letter issued by the Administrator 
     shall be subject to notice and comment requirements. The 
     conference substitute omits the

[[Page H1930]]

     Senate provision on direct delivery of commodities. (Section 
     3007)
       The Managers note that at present, milling or processing 
     facilities located in or near countries receiving food aid 
     are occasionally unable to process commodities or arrange for 
     the monetization of commodities because the non-governmental 
     organizations coordinating or arranging the food aid delivery 
     do not interact on a timely basis with the milling or 
     processing facilities. This often leads to delay and 
     inefficiencies in the food aid program.
       The streamlining of procedures and regulatory requirements, 
     and acceleration of the approval and review of projects 
     involving food aid programs administered by USDA and US-AID 
     are a priority in this legislation. It is equally important 
     that participating non-governmental organizations also 
     expedite the delivery of their projects by consulting with 
     milling or processing facilities prior to filing project 
     applications with USDA or US-AID. It is necessary for USDA, 
     US-AID, and participating non-governmental organizations to 
     act in concert to streamline and expedite procedures and 
     activities to achieve a more effective and timely food aid 
     delivery process.
     (16) Funding for Stockpiling and Rapid Transportation, 
         Delivery, and Distribution of Shelf-Stable Prepackaged 
         Foods
       The House bill reauthorizes at current funding level 
     through 2011. (Section 307)
       The Senate amendment reauthorizes at current funding level 
     through 2006. (Section 308)
       The Conference substitute adopts the House provision, 
     reauthorizing the funding through 2007. (Section 3008)
     (17) Sale Procedure
       The House bill adds a new subsection, (l), to section 403 
     that provides that (b) and (h) shall apply to titles II and 
     III of Food for Peace, section 416(b) of the Agricultural Act 
     of 1949, and section 1110 of the Food and Security Act of 
     1985. It also allows for monetization in the sales to 
     generate proceeds under these designated sections and titles. 
     (Section 307)
       The Senate amendment adds a new subsection, (l), to section 
     403 that provides that (b) shall apply to section 416(b) of 
     the Agricultural Act of 1949, and title VIII of the 
     Agricultural Trade Act of 1978. It also allows for 
     monetization in the sales to generate proceeds under these 
     programs, and defines reasonable market price for purposes of 
     monetization of commodities. (Section 310)
       The Conference substitute adopts the House provision with 
     respect to sale procedure and adopts the Senate provision 
     with respect to reasonable market price. (Section 3009)
       The reasonable market price provision requires that 
     commodities be sold at a reasonable market price in the 
     economy where the commodity is to be sold. This would 
     generally be the locally prevailing price for the same or a 
     similar commodity.
       The Managers understand that, as with commercial sales, the 
     actual sales price will be affected by product quality and 
     delivery and payment terms. There are two primary purposes 
     for this provision. The first is to ensure that commodities 
     are sold at the prevailing local market price, rather than 
     imposing an arbitrary formula approach.
       The Managers believe that a relatively inflexible formula 
     approach is undesirable because in situations in which local 
     prices are above the formula value, the formula does not 
     maximize proceeds from sales of commodities. Conversely, in 
     cases in which the formula produces a price significantly 
     above locally prevailing prices, no sales are likely to 
     result, to the possible detriment of program operations in 
     recipient countries.
       The second reason for this provision is to bring 
     consistency to the approaches currently used by US-AID and 
     USDA. The Managers understand that although the two agencies 
     generally operate in different countries at different times, 
     some monetization programs may overlap. The Managers expect 
     that, should this occur, the two agencies will consult to 
     ensure that, to the extent possible, a uniform sales price is 
     established. More generally, the Managers expect the two 
     agencies to adopt methodologies for determining a reasonable 
     market price that will tend to produce similar results in 
     determining sales prices.
       Finally, the Managers note that this provision is intended 
     to be consistent with the goal of maximizing proceeds from 
     commodity sales. In deciding whether to approve a proposed 
     sale of commodities at the local market price, the Managers 
     expect that both agencies will take into account the 
     prevailing U.S. and world market prices of a commodity, 
     including U.S. acquisition costs, transportation costs, and 
     any localized factors that might result in significant 
     differences between prevailing local market prices and those 
     prices that would be expected to prevail in a pure free 
     market. In cases in which high-quality U.S. agricultural 
     products are purchased for the program, it should be noted 
     that the market in the recipient country may not be 
     sufficiently sensitive to fully reflect quality premiums.
     (18) Lamb Program
       The Senate amendment permits the Secretary to establish a 
     program to provide live lamb on an emergency food relief 
     basis to Afghanistan. (Section 309)
       The House bill contains no comparable provision.
       The Conference substitute incorporates the Senate provision 
     into another section of this title dealing with a report on 
     use of perishable commodities in food aid programs. (Sec. 
     3207)
     (19) Reauthorize Limits on Funding for Prepositioning
       The House bill reauthorizes limits on funding for 
     prepositioning through 2011. (Section 307)
       The Senate amendment reauthorizes limits on funding for 
     prepositioning through 2006. (Section 311)
       The Conference substitute adopts the Senate provision, 
     reauthorizing the funding through 2007. (Section 3010)
     (20) Authority for Paying Transportation Costs Under Title II 
         Non-Emergency Program
       The House bill adds a provision providing the authority for 
     the US-AID Administrator to pay for transportation costs for 
     nonemergency assistance under Title II, and only to least 
     developed countries. (Section 307)
       The Senate bill contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 3012)
     (21) Expiration Date
       The House bill extends the expiration date to December 31, 
     2011. (Section 307)
       The Senate amendment extends the expiration date to 
     December 31, 2006. (Section 312)
       The Conference substitute adopts the House provision, 
     reauthorizing the program through fiscal year 2007. (Section 
     3011)
     (22) Reauthorize Farmer-to-Farmer Program
       The House bill reauthorizes the Farmer-to-Farmer Program 
     through 2011 at the current funding level of 0.4 percent of 
     the funds made available under titles I and II of P.L. 480 
     (Section 307)
       The Senate amendment reauthorizes the Farmer-to-Farmer 
     Program through 2006 and increases the share of P.L.-480 
     title I and title II funding which can be diverted for 
     support of the program from 0.4 to 0.5 percent. (Section 314)
       The Conference substitute adopts the House provision, 
     reauthorizing the program through 2007 and the Senate 
     provision that increases funding for the program. (Section 
     3014)
     (23) Micronutrient Fortification Pilot Program
       The Senate amendment re-authorizes the micronutrient 
     fortification pilot program. (Section 313)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     technical corrections, also adding folic acid as a fortifying 
     element that can be used under the program. The US-AID 
     sponsored ``Micronutrient Assessment Project'' study (report 
     issued in 1999), found significant quality problems in 
     fortified food aid commodities, including low micronutrient 
     levels and the loss of highly labile vitamins. A US-AID-
     sponsored ``Micronutrient Compliance Review of Fortified P.L. 
     480 Commodities'' (report issued in 2001) found that while 
     progress has been made, additional follow-up is needed to 
     assure adequate micronutrient levels in the fortified 
     commodities and to standardize procedures used to test and 
     monitor for compliance. Additional concerns, such as lack of 
     shelf-life information, bioavailibility and package 
     durability have also been reported. The organization that 
     conducted the 1999 and 2001 assessments uses an effective 
     approach of engaging technical experts from food industries 
     to improve the quality and nutritional content of food 
     products for developing countries. This provision calls on 
     the Administrator, in consultation with the Secretary, to use 
     the same mechanism to follow-up on the 2001 compliance review 
     recommendations to improve and assure the quality of 
     fortified food aid commodities. (Section 3013)
     (24) Emerging Markets
       The House bill reauthorizes the Emerging Markets program 
     through 2011, and increases the amount of assistance the 
     Secretary shall provide for the Agricultural Fellowship 
     Program from $10 million to $13 million. (Section 308)
       The Senate amendment reauthorizes the Emerging Markets 
     program at current levels through 2006, but does not increase 
     the amount of assistance. (Section 332)
       The Conference substitute adopts the Senate provision 
     reauthorizing the program through 2007. (Section 3203)
     (25) Bill Emerson Humanitarian Trust
       The House bill extends the Bill Emerson Humanitarian Trust 
     Act through 2011. (Section 309)
       The Senate amendment extends the Bill Emerson Humanitarian 
     Trust Act through 2006. (Section 331)
       The Conference substitute adopts the Senate provision, 
     reauthorizing the program through 2007. (Section 3202)
     (26) Technical Assistance for Specialty Crops
       The House bill establishes an export assistance program to 
     address barriers to the export of United States specialty 
     crops; provides direct assistance through public and private 
     sector projects; and technical assistance to remove, resolve, 
     and/or mitigate sanitary or phytosanitary and related 
     barriers to trade. It also gives priority to time sensitive 
     and market access projects based on the trade effect and 
     trade impact and authorizes $3 million annually from the 
     Commodity Credit Corporation. (Section 310)
       The Senate amendment directs USDA to assist U.S. exporters 
     harmed by ``unwarranted and arbitrary'' barriers to trade due

[[Page H1931]]

     to marketing of biotechnology products, food safety, disease, 
     or other SPS concerns and authorizes appropriations of $1 
     million annually through 2006. (Section 333)
       The Conference substitute adopts the House provision, with 
     funding provided at $2 million per year from the Commodity 
     Credit Corporation. (Section 3205)
     (27) Farmers From Africa and Caribbean Basin Program
       The House bill authorizes $10 million for the President to 
     establish and administer bilateral exchange programs whereby 
     U.S. farmers and farming specialists provide technical advice 
     and assistance to eligible farmers in Africa and the 
     Caribbean Basin countries. (Section 311)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision, to be 
     incorporated into the existing Farmer-to-Farmer program, 
     authorizing appropriations, while allowing the Administrator 
     to use up to five percent of those appropriated funds to 
     cover administrative expenses in operating the program. 
     (Section 3014)
     (28) George McGovern-Robert Dole International Food for 
         Education and Child Nutrition Program
       The House bill authorizes the President to direct the 
     provision of U.S. agricultural commodities and financial and 
     technical assistance for foreign preschool and school feeding 
     programs to reduce hunger and improve literacy (particularly 
     among girls) and nutrition programs for pregnant and nursing 
     women and young children. It also authorizes the 
     appropriation of such sums as may be necessary each year 
     through FY2011. The President has the authority to designate 
     the administering federal agency. For this program, eligible 
     recipients are PVO's, cooperatives, governments and their 
     agencies, and other organizations. Funds may be used to pay 
     commodity transportation and storage costs, in-country 
     activities that enhance the programs, and certain providers' 
     administrative expenses. The House bill specifies a list of 
     priorities for program funding and provides guidelines for 
     application process, encourages multilateral involvement and 
     private sector involvement, and requires assurances that 
     local production and marketing in recipient countries are not 
     disrupted. Annual reports to Congress are required. (Section 
     312)
       The Senate amendment requires the establishment of an 
     International Food for Education and Nutrition Program, as a 
     separately funded program within the new Food for Progress 
     title, whereby USDA may provide commodities and technical and 
     nutrition assistance for programs that improve food security 
     and enhance educational opportunities for preschool and 
     primary school children in the recipient countries. USDA is 
     authorized to use not more than $150 million per year for 
     four years to carry out this program. Eligible organizations 
     are PVO's, cooperatives, nongovernmental organizations, or 
     foreign countries, as determined by USDA. Permitted uses of 
     funds, and various other requirements not specified here are 
     the same as those that apply to Food for Progress activities 
     generally. The Senate amendment includes a ``graduation 
     requirement'' to provide for continuation of the program when 
     funding terminates. It also encourages other donor and 
     private sector involvement and requires an annual report to 
     Congress. (Section 325(c))
       The Conference substitute adopts the House bill provisions, 
     with the following modifications: (1) accepts Senate 
     provisions on graduation; (2) accept Senate language on 
     availability of funds for internal shipping, transportation, 
     and handling costs, and (3) provides $100 million in 
     mandatory funding for fiscal year 2003 to continue existing 
     pilot projects. The program is to be named the McGovern-Dole 
     International Food for Education and Child Nutrition program. 
     (Section 3107)
       The Managers expect that mandatory funds provided for 
     fiscal year 2003 will be utilized to continue the operation 
     of projects approved under the pilot program.
     (29) Study on Fee for Services
       The House bill instructs the Secretary to report to 
     Congress on the feasibility of instituting a program charging 
     fees to cover the costs of services performed abroad on 
     matters within the authority of the Department of Agriculture 
     administered by the Foreign Agriculture Service. (Section 
     313)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     the clarification that the report would address the 
     feasibility of a program that charged fees would be assessed 
     only for services performed beyond those already provided by 
     the Foreign Agricultural Service as part of an overall market 
     development strategy for a particular country or region. 
     (Section 3208)
     (30) National Export Strategy Report
       The House bill directs the Secretary to prepare a long-
     range comprehensive agricultural trade strategy and to report 
     to the House Committees on Agriculture and International 
     Relations, and the Senate Committee on Agriculture, Nutrition 
     and Forestry, on the activities the Department of Agriculture 
     has undertaken to implement the National Export Strategy 
     Report. (Section 314)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision, 
     changing the report to consultations with relevant 
     Congressional Committees which will occur within six months 
     of enactment, and every two years subsequently. (Section 
     3206)
     (31) Exporter Assistance Initiative
       The Senate amendment authorizes development of a federal 
     website to assist aspiring exporters to learn all they need 
     to know about getting started. An authorization of 
     appropriations is provided at the following levels: $1 
     million for each of 2003 and 2004 and $500,000 for 2005 and 
     2006. (Section 326)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision, 
     amended to instruct the Secretary to maintain a website to 
     assist exporters or potential exporters of U.S. agricultural 
     products. No appropriations are authorized. (Section 3101)
       The Managers observe that knowledge about legal and 
     regulatory requirements that apply to the export of an 
     agricultural product is basic to any transaction. This 
     applies to the country in which the exporter is located and 
     the importing foreign country. Many countries already provide 
     at least this much assistance to private exporters. In the 
     United States, a small exporter that cannot afford to hire a 
     trade consultant has been forced to navigate among numerous 
     Federal laws and regulations that impact an export 
     transaction. Today, the Internet provides a propitious 
     vehicle for making such information accessible. The Foreign 
     Agricultural Service at USDA has developed a website that 
     provides information about USDA programs that may affect the 
     exporter, recommendations on how to develop a marketing plan, 
     and tariff and sanitary/phyto-sanitary requirements of 
     several countries. However the website does not alert the 
     small exporter to U.S. laws such as, for example, the Corrupt 
     Practices Act that may impact the export. Linkage to the 
     website of the Treasury Department for detailed information 
     about the Corrupt Practices Act is also necessary. A new 
     Government website, `FirstGov', provides access to the 
     Department of the Treasury's website, but the FAS website 
     does not provide a link to FirstGov.
       Other U.S. agencies such as the Treasury Department's 
     Office of Foreign Assets Control and the Commerce 
     Department's Bureau of Export Administration enforce laws and 
     regulations which bear on international business transactions 
     involving agricultural products. Access to the websites of 
     these agencies is also necessary to ensure that a potential 
     or current exporter has access to a maximum amount of 
     information relevant to the international commercial 
     transaction. A small exporter needs more than just 
     information about U.S. laws and regulations. Information 
     about tariff and non-tariff regulations of importing 
     countries is needed. Information about private companies in 
     this country and abroad that may impact a marketing plan and 
     decision to proceed with the export transaction is also 
     necessary. A new website established by USDA, the Export 
     Directory of U.S. Food Distribution Companies, provides a 
     good start. The Secretary of Agriculture is directed to 
     improve and maintain the FAS website consistent with the 
     requirements of this provision and to coordinate the content 
     of this website with the agency responsible for the FirstGov 
     website. The Secretary is further directed to improve the FAS 
     website so that an exporter may connect to links with 
     oversees governmental, private sector, and non-profit sector 
     websites that provide information on market opportunities, 
     marketing requirements and restrictions, product preferences, 
     foreign legal considerations, and other information that may 
     assist the exporter with marketing an agricultural product in 
     a foreign market.
     (32) Biotechnology and Agriculture Trade Program
       The Senate amendment requires USDA to establish a program 
     to assist exporters facing problems with biotech-based 
     agricultural products. The Senate amendment requires $15 
     million of CCC funding per year through 2006. (Section 333)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision 
     establishing a stand-alone program, providing an 
     authorization of appropriations. The provision is also 
     revised to reflect a narrower purpose than the original 
     Senate provision, focusing on technical assistance in 
     addressing barriers to trade. (Section 3204)
     (33) Agricultural Trade with Cuba
       The Senate amendment strikes restrictions on private 
     financing of sales of food and medicine to Cuba that were 
     established in the FY 2001 Agricultural Appropriations bill. 
     (Section 335)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (34) Sense of Congress Regarding Agricultural Trade
       The Senate amendment establishes Congressional priorities 
     and concerns for bilateral and multilateral agricultural 
     trade negations. (Section 336)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision, 
     changing it to reflect the Sense of the Senate rather than 
     the Congress. Similar priorities are also reflected in

[[Page H1932]]

     the Trade Promotion Authority bill (H.R. 3005) passed by the 
     House in 2001. (Section 3210)
     (35) Report on Use of Perishable Commodities in Food Aid
       The Senate amendment requires the Secretary to report on 
     transportation, storage, and funding deficiencies that limit 
     the use of perishable and semi-perishable commodities in USDA 
     international food aid programs. (Section 337)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision, with 
     technical changes and adds a requirement to examine the cost 
     of shipping live lambs and other animals for use in U.S. food 
     aid programs. (Section 3207)
     (36) Sense of Senate Regarding Foreign Assistance Programs
       The Senate amendment notes past success of U.S. foreign 
     assistance in helping democratize developing nations and 
     create U.S. commercial customers, and urges increased role of 
     such programs in countries with impoverished and 
     disadvantaged populations that are the breeding grounds for 
     terrorism. (Section 338)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision, 
     changing it to reflect the Sense of the Congress rather than 
     the Senate. (Section 3209)

                          Title IV--Nutrition

     (1) Short Title
       The Senate Amendment names Title IV the Food Stamp 
     Reauthorization Act of 2001. (Section 401)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4001)


                     subtitle a--food stamp program

     (2) Simplified Definition of Income
       The House bill adds new types of income exclusions: at 
     state option, education assistance that is required to be 
     excluded under its Medicaid rules; ``state complementary 
     assistance program payments'' that are excluded under 
     Medicaid rules; and at state option, any income the state 
     does not consider when determining eligibility for cash 
     assistance under its Temporary Assistance for Needy Families 
     (TANF) program or eligibility for medical assistance under 
     its Medicaid program. Under the third exclusion authority, 
     states are specifically not permitted to exclude earned 
     income, various Social Security Act payments (e.g., 
     Supplemental Security Income (SSI), Social Security 
     disability and retirement benefits, and foster care and 
     adoption assistance payments), or other types of income the 
     Secretary judges essential to equitable eligibility 
     determinations. (Section 401)
       The Senate amendment adds new income exclusions: education 
     assistance, ``state complementary assistance program 
     payments,'' same as the House bill with technical differences 
     and at state option; any types of income the state does not 
     consider when determining eligibility for or the amount of 
     cash assistance under its TANF program or eligibility for 
     medical assistance under its Medicaid program. Under the 
     third exclusion authority, states are specifically not 
     permitted to exclude wages or salaries, various Social 
     Security Act payments, regular payments from a government 
     source (such as unemployment benefits and general 
     assistance), workers' compensation, child support payments 
     (for the recipient), or other types of income the Secretary 
     judges essential to equitable eligibility determinations. It 
     is the intent of this provision to align, to the extent 
     possible, with Medicaid and TANF rules and that the Secretary 
     will only add additional types of income that are judged to 
     be absolutely essential to make equitable determinations of 
     eligibility in the food stamp program. (Section 412)
       The Conference substitute adopts the Senate provision. 
     (Section 4102)
       The Managers intend that this provision will allow states 
     to eliminate consideration of any types of income they do not 
     consider when judging eligibility for temporary assistance to 
     needy families (TANF) cash assistance or those required to be 
     covered by Medicaid. It does not include items that are 
     included in the definition of income but part of which are 
     disregarded for the purposes of TANF and Medicaid by state 
     agencies.
     (3) Standard Deduction
       The House bill establishes multiple standard deductions 
     equal to 9.7 percent of the federal poverty income guideline 
     amounts used for food stamp income eligibility determinations 
     in FY2002. The new standard deductions would remain fixed 
     over time. It also requires that the new standard deductions 
     not be less than the current amount for each jurisdiction or 
     greater than 9.7 percent of the FY2002 poverty guideline 
     amounts for a 6-person household. In the case of the Virgin 
     Islands, the new standard deductions would be similar to 
     those for the 48 states and the District of Columbia. In the 
     case of Guam, a special rule would maintain standard 
     deduction levels at about twice the levels for the 48 states 
     and the District of Columbia. (Section 402)
       The Senate amendment establishes multiple standard 
     deductions equal to an increasing percentage of the 
     inflation-indexed federal poverty income guideline amounts 
     used for food stamp income eligibility determinations: for 
     FY2002-FY2004, the new standard deductions would equal 8 
     percent of each year's poverty guideline amounts; for FY2005-
     FY2007, the new standard deductions would equal 8.5 percent 
     of each year's poverty guideline amounts; for FY2008-FY2010, 
     the new standard deductions would equal 9 percent of each 
     year's poverty guideline amounts; and for FY2011and each 
     following year, the new standard deductions would equal 10 
     percent of each year's poverty guideline amounts. The Senate 
     amendment also requires that the new standard deductions not 
     be less than the current amount for each jurisdiction or 
     greater than the applicable percentage (noted above) of the 
     poverty guideline amounts for a 6-person household. In the 
     case of the Virgin Islands, the new standard deductions would 
     be similar to those for the 48 states and the District of 
     Columbia. In the case of Guam, a special rule would maintain 
     standard deduction levels at about twice the levels for the 
     48 states and the District of Columbia. (Section 171(c)(2), 
     replacing Section 413)
       The Conference substitute adopts the House provision with 
     an amendment that sets the standard deduction equal to 8.31 
     percent of the inflation-indexed federal poverty income 
     guideline used for food stamp income eligibility 
     determinations and includes comparable provisions for the 
     Virgin Islands and Guam. (Section 4103)
     (4) Transitional Food Stamps for Families Moving From Welfare
       The House bill provides, at state option, for 6 months of 
     transitional food stamp benefits for families no longer 
     eligible to receive Temporary Assistance for Needy Families 
     (TANF). Households could receive transitional benefits for up 
     to 6 months after termination of cash assistance, regardless 
     of whether their certification period expires during the 
     transitional period. The transitional benefit amount would be 
     equal to the monthly allotment households received in the 
     month immediately prior to termination. Households receiving 
     transitional benefits could apply for food stamps under 
     regular rules at any time during the transitional period. In 
     the final month of the transitional period, states could 
     require a household to cooperate in a re-determination of 
     eligibility in order to receive continued benefits.
       Transitional benefits would not be allowed for (1) 
     households sanctioned under food stamp rules for intentional 
     program violations, failure to cooperate, failure to meet 
     work requirements, transferring assets to gain eligibility, 
     failure to perform an action required under a federal, state, 
     or local means-tested public assistance program, multiple 
     receipt of food stamp benefits, or failure to fulfill child-
     support-related requirements and (2) households sanctioned 
     for failure to perform an action required by federal, state, 
     or local law relating to TANF cash assistance. (Section 403)
       The Senate amendment permits states to provide transitional 
     food stamp benefits to households who cease to receive TANF 
     cash assistance. Under this option, households could receive 
     transitional benefits for up to 6 months after termination 
     of cash assistance, without regard to normal eligibility 
     reviews or termination of an eligibility review period. 
     During the transitional period, food stamp benefits 
     generally would be frozen, without required reports of 
     changed circumstances. Transitional benefits would be 
     equal to the monthly allotment received in the month 
     immediately prior to termination adjusted for (1) the 
     change in household income because of termination of cash 
     assistance and (2) any changes in circumstances that could 
     increase household benefits (if the household elects to 
     report them). In the final month of the transitional 
     period, states could require a household to cooperate in a 
     re-determination of eligibility in order to receive 
     continued benefits.
       Transitional benefits would not be allowed for households 
     (1) losing eligibility under food stamp rules for intentional 
     program violations, failure to cooperate or meet work-
     requirements, post-secondary students, transferring assets to 
     gain eligibility, failure to perform an action required by a 
     means-tested assistance program, receipt of multiple 
     benefits, fleeing felons, or failure to fulfill child-
     support-related requirements, (2) sanctioned for failure to 
     perform an action required by a federal, state, or local TANF 
     law, or (3) in any state-designated category. (Section 429)
       The Conference substitute adopts the Senate provision with 
     an amendment that allows households to receive transitional 
     benefits for up to 5, instead of up to 6, months after 
     termination of cash assistance, without regard to normal 
     eligibility reviews or termination of an eligibility review 
     period. In addition, transitional benefits are equal to the 
     monthly allotment received in the month immediately prior to 
     termination, adjusted for the change in household income 
     because of termination of cash assistance but not adjusted 
     for any other changes in circumstances that could increase 
     household benefits and which the household may report. The 
     Conference substitute retains the House bill language that 
     enables households receiving transitional benefits to apply 
     for food stamps under regular rules at any time during the 
     transitional period. (Section 4115)
     (5) Quality Control Systems
       The House bill reforms the food stamp quality control 
     program to require the Secretary to use a 95 percent 
     statistical probability (lower bound) in calculating state

[[Page H1933]]

     error rates. States with a total payment error rate (lower 
     bound) between 6 percent and the national performance measure 
     (plus 1 percentage point) receive no special treatment, but 
     have to develop and implement corrective action plans to 
     reduce errors. The bill provides that, in determining 
     sanctions against states for high error rates, sanctions are 
     delayed until the third consecutive year in which a state's 
     error rate (lower bound) exceeds the national average error 
     rate by more than 1 percentage point.
       Sanctions are figured as follows: First, the state's 
     potential total liability amount is calculated. This is the 
     difference between its total payment error rate (point 
     estimate) and the national performance measure plus one 
     percentage point, multiplied by the dollar value of benefits 
     issued in the state for the year. Then, the state's actual 
     penalty/sanction is calculated. This assessment is ``scaled'' 
     according to how far above 10 percent the state's total 
     payment error rate (point estimate) is.
       The House bill also requires the Secretary to measure 
     states' performance with respect to (1) compliance with 
     deadlines for prompt determinations of eligibility and 
     issuance of benefits and (2) the percentage of negative 
     eligibility decisions that are made correctly for each of 
     fiscal years 2002 through 2007. It provides for ``excellence 
     bonus payments'' of $1 million each to (1) the 5 states with 
     the highest combined performance in the 2 measures noted 
     above and (2) the 5 states whose combined performance in the 
     2 measures noted above is most improved for each of fiscal 
     years 2002-2007. (Section 404)
       The Senate amendment reforms the system that measures the 
     degree to which states make erroneous eligibility and benefit 
     decisions so that only states with serious, persistent 
     problems would be sanctioned. For states with error rates 
     below 6 percent, enhanced federal matching is reduced for 
     2001 and then discontinued in subsequent years. States with a 
     total payment error rate between 6 percent and the national 
     average plus 1 percentage point would receive no special 
     treatment. All states are required to develop and implement 
     corrective action plans to reduce payment errors. Each year, 
     the Secretary is required to investigate the administration 
     of the food stamp program in states with a total payment 
     error rate above the national average plus one percentage 
     point, unless sufficient information is already available to 
     review the state's administration. A ``good cause'' exception 
     is provided. If the investigation/review results in a 
     determination that the state has been ``seriously negligent'' 
     (under standards promulgated by the Secretary), the state has 
     to pay a fine (``initial sanction'') that reflects the extent 
     of negligence (again, under standards promulgated by the 
     Secretary) not to exceed 5 percent of the federal match for 
     state administrative costs. States with a total payment error 
     rate above the national average plus 1 percentage point are 
     assessed fiscal penalties if they have been the subject of an 
     investigation/review or sanctioned for high error rates in 
     each of the 2 preceding years. This effectively sanctions 
     states with a payment error rate above the national average 
     plus 1 percentage point for 3 consecutive years, in the third 
     year as in the House bill. Sanctions are figured in the same 
     way as is done in the House bill.
       Beginning with error rates calculated for FY2002, the 
     Senate amendment establishes in law a requirement that the 
     Secretary adjust states' total payment error rates to take 
     into account any increases in errors because a state serves 
     high percentages of households with earnings or households 
     containing non-citizens. The adjustments are similar to those 
     carried out under current policy for states subject to 
     penalties/ sanctions; however, they are somewhat more liberal 
     in the measurement standard they use to identify states with 
     ``high'' proportions of error-prone households, likely 
     qualifying more states for an adjustment. For error rates 
     figured for FY2003 and later years, additional adjustments to 
     states' total payment error rates are permitted, as the 
     Secretary determines consistent with achieving the purposes 
     of the Food Stamp Act. (Section 431)
       The Senate amendment beginning with FY2002, requires the 
     Secretary to measure states' performance with respect to the 
     proportion of households with children having (a) income 
     below 130 percent of the federal poverty income guidelines 
     and (b) annual earnings of at least half the full-time 
     minimum wage equivalent who receive food stamps. Beginning 
     with FY2002, it also requires the Secretary to measure 
     states' performance with respect to four additional measures 
     established by the Secretary in consultation with the 
     National Governors Association, the American Public Human 
     Services Association, and the National Conference of State 
     Legislatures. The additional four measures must be 
     established not later than 180 days after enactment, and at 
     least 1 measure must relate to the provision of timely and 
     appropriate services to food stamp applicants and recipients.
       In FY2003 and each following year, it requires the 
     Secretary to make ``high performance bonus payments'' 
     totaling $6 million for each of the 5 measures noted above. 
     For each measure, payments (allocated by caseload size) are 
     to be made to the 6 states with (1) the greatest improvement 
     in performance, (2) the highest level of performance, or (3) 
     a combination of greatest improvement and highest 
     performance. Among the 6 states chosen for payments under 
     each measure, payments are allocated according to caseload 
     size.
       The Senate amendment prohibits bonus payments to states 
     subject to a quality control system sanction for that fiscal 
     year and it provides that the Secretary's determinations 
     relating to whether and in what amount bonus payments are 
     made are not subject to judicial review. (Section 433)
       The Conference substitute adopts the Senate provisions with 
     amendments. In general, the new system eliminates features of 
     current law under which approximately half the states must be 
     assessed sanctions each year, reconfigures the formula for 
     determining sanction amounts, delays any sanctions until a 
     state has shown a persistently high error rate, explicitly 
     recognizes a policy for new investment in improved 
     administration by states with high error rates, places some 
     limits on the Secretary's ability to excuse payment of 
     sanctions, and replaces the current system for rewarding 
     states with very low error rates with a requirement to pay 
     bonuses to states that exhibit exemplary administrative 
     performance. The major features of the Conference substitute 
     are as follows.
       Threshold for potential sanctions: The threshold for 
     sanctions is set at 105 percent of the national average, 
     rather than the national average as under current law.
       Calculation of state error rates: A state is not considered 
     to be above the threshold unless there is a 95 percent 
     statistical certainty that the state's error rate is truly 
     above the threshold.
       Sanction Notification and Method of Payment: When the 
     Secretary determines that a state must pay a sanction, the 
     state agency, the Governor, and the state legislature must be 
     notified. The Chief Executive Officer of the state subject to 
     a sanction must remit the amount of the sanction or the 
     state's letter of credit will be reduced.
       Corrective action plans: States with combined error rates 
     of 6 percent or more are required to provide a corrective 
     action plan to the Secretary.
       Time period for sanctions: States will not have a sanction 
     amount calculated until the second consecutive year in which 
     their error rates exceed the threshold. If, in the following 
     year, they still exceed the threshold, they will be required 
     to pay an amount the Secretary has determined to be at risk.
       State liability: States' potential liability amounts will 
     equal dollar issuance multiplied by ten percent of the amount 
     by which a state's error rate exceeds a six percent 
     threshold. Under the Conference substitute, the Secretary has 
     the authority to resolve the liability (calculated for the 
     second consecutive year in which the state exceeds the 
     threshold) in one of three ways: require the state to 
     reinvest up to 50 percent of the liability; hold up to 50 
     percent of the liability ``at risk,'' to be paid as a 
     sanction by the state the following year only if the state's 
     error rate continues to exceed the threshold; or to waive any 
     amount that is not reinvested or held at risk. If a state 
     fails to reduce its error rate to below the threshold for a 
     third consecutive year, it must pay its `at-risk' amount to 
     the federal government. The Secretary may settle amounts 
     required to be reinvested.
       Waivers, Adjustments and Appeals: The Secretary retains the 
     authority to waive any amount of a state's potential 
     liability and to make adjustments to claims against states. 
     States continue to have the full right to appeal liability 
     amounts.
       Enhanced funding and bonus payments: Enhanced funding is 
     eliminated for Fiscal Year 2003 and beyond and replaced by 
     bonuses to states. The Secretary must issue regulations 
     regarding the criteria for bonus awards for FY2005 and 
     succeeding years. Performance criteria specified in 
     legislation include those related to actions taken to correct 
     errors; reduce rates of error; and improve eligibility 
     determinations, including in the area of service delivery 
     (such as timeliness and a low rate of improper denials). The 
     Secretary is directed to solicit concrete ideas within these 
     general areas from state agencies and organizations that 
     represent state interests prior to issuing proposed 
     regulations. For FY2003 and FY2004, the Secretary is provided 
     the authority to issue guidance to the state regarding 
     criteria for bonus awards.
       Effective dates: The new policy is effective for error 
     rates measured in FY 2003 and sanctions and enhanced funding 
     laws and regulations are unchanged for FY2002 and prior 
     years. (Sections 4118 and 4120)
     (6) Simplified Application and Eligibility Determination 
         Systems
       The House bill requires the Secretary to spend up to $9.5 
     million to provide grants to states to develop and implement 
     programs that improve the food stamp application and 
     eligibility determination process. (Section 405)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment to establish a program of grants to states and 
     other eligible entities to simplify food stamp application 
     and eligibility determination systems and to improve access 
     to the food stamp program. The Secretary would be required to 
     fund grants totaling up to $5 million per year for projects: 
     to coordinate application and eligibility procedures; 
     establish methods for applying and determining eligibility 
     that use electronic alternatives; otherwise improve program 
     administration; or improve access to the Program. Grants 
     could not be made for on-going costs and

[[Page H1934]]

     preference would be given to government/non-government 
     partnerships.
       In addition to the types of projects described in the 
     amendment, the Managers believe that other types of projects 
     may be permissible under this section. These projects include 
     but are not limited to:
       (a) establishing a single site at which individuals may 
     apply for food stamp benefits, supplemental security income, 
     Medicaid, states' children's health insurance program 
     benefits, WIC benefits and benefits under other programs 
     as determined by the Secretary;
       (b) developing systems to enable increased participation in 
     the provision of benefits under the food stamp program 
     through farmers' markets, roadside stands, and other 
     community-supported agriculture programs, including wireless 
     electronic benefit transfer systems and other systems 
     appropriate to open-air settings where farmers and other 
     vendors sell directly to consumers;
       (c) encouraging consumption of fruit and vegetables by 
     developing a cost-effective system for providing discounts 
     for purchases of fruit and vegetables made through use of 
     electronic benefit transfer cards; or,
       (d) reducing barriers to participation by individuals, with 
     emphasis on working families, eligible immigrants, elderly 
     individuals, and individuals with disabilities.
       The Conference substitute repeals existing grant authority 
     (Section 17(i)), dependent on appropriations, in the 
     expectation that similar grants may be made under this new 
     authority. (Section 4116)
     (7) Authorization of Appropriations: Employment and Training 
         Programs
       The House bill reauthorizes the existing food stamp 
     employment and training program through FY2011. It sets the 
     annual amount of unmatched federal funds at the current 
     FY2002 level of $165 million. It also preserves the current 
     requirement to use at least 80 percent of unmatched federal 
     funding for able-bodied adults without dependents (ABAWDs). 
     (Section 406(a))
       The Senate amendment extends the requirement for unmatched 
     federal funding for employment and training programs through 
     FY2006; and sets the basic amount of unmatched federal 
     funding at $90 million a year for FY2002-FY2006.
       In addition to the basic $90 million a year, the Senate 
     amendment requires the Secretary to allocate up to $25 
     million a year for FY2002-FY2006 to reimburse states for 
     services to able-bodied adults without dependents (ABAWDs). 
     In order to be eligible for a share of this unmatched 
     funding, a state must (1) exhaust its basic funding 
     allocation and (2) make and comply with a commitment to offer 
     an employment/training placement (``position'') to all 
     applicant/recipient ABAWDs who are in the last month of their 
     6-month eligibility period under ABAWD work rules and not 
     eligible for an exemption.
       The Senate amendment rescinds any unmatched federal funding 
     provided through FY2001 unless obligated by a state before 
     enactment. However, the new $90 million basic grant money 
     would remain available until expended, while the new $25 
     million ABAWD grant money would not. It also provides that 
     the basic $90 million a year in unmatched federal funding be 
     allocated among states according to a formula established and 
     adjusted by the Secretary that takes into account their ABAWD 
     populations; and eliminates the requirement to use at least 
     80 percent of unmatched federal funding for ABAWDs.
       The Senate amendment eliminates the ``maintenance of 
     effort'' requirement, whereby states must maintain 
     expenditures on employment and training programs at a level 
     not less than FY 1996 spending in order to receive a portion 
     of their allocation of unmatched federal funding; and 
     eliminates the authority for the Secretary to set 
     reimbursement levels for each qualifying employment and 
     training slot that a state offers or fills. (Section 434)
       The Senate amendment eliminates the $25 per-month limit on 
     the amount that states provide to participants in employment 
     and training programs for transportation and other costs 
     (other than dependent care costs) that are reasonably 
     necessarily and directly related to their participation. 
     (Section 169(c)(3)) It also eliminates the limit on federal 
     matching payments for these costs. (Section 169(c)(4))
       The Conference substitute adopts the Senate provision with 
     technical changes, and amendments to: provide unmatched 
     funding through FY2007, reduce the allocation from ``up to 
     $25 million a year'' to ``up to $20 million a year'' to 
     reimburse states for services provided only to ABAWDs, and 
     eliminate the requirement that states must exhaust their 
     basic funding allocation before being eligible for a share of 
     this unmatched funding. (Section 4121)
     (8) Authorization of Appropriations: Cost Allocation
       The House bill extends the required reduction in federal 
     matching payments to states for administrative costs through 
     FY2011. (Section 406(b))
       The Senate amendment extends the required reduction in 
     federal matching payments to states for administrative costs 
     through FY2006. (Section 435(a))
       The Conference substitute adopts the House provision with 
     an amendment to reauthorize the required reduction in federal 
     matching payments to states for administrative costs through 
     FY2007. (Section 4122)
     (9) Authorization of Appropriations: Cash Payment Pilot 
         Projects
       The House bill extends the authority for cash payment 
     projects through FY2011, if the state requests. (Section 
     406(c))
       The Senate amendment extends authority for cash payment 
     projects through FY2006, if the state requests. (Section 
     435(b))
       The Conference substitute adopts the House provision with 
     an amendment to extend the authority for cash payment 
     projects through FY2007, if the state requests. (Section 
     4122)
     (10) Authorization of Appropriations: Outreach Demonstration 
         Projects
       The House bill extends the authority for outreach 
     demonstration projects through FY2011. (Section 406(d))
       The Senate amendment extends the authority for outreach 
     demonstration projects through FY2006. (Section 435(c))
       The Conference substitute repeals the authority for 
     outreach demonstration projects and replaces it with new 
     grant authority found in Section 4116. (Section 4122)
     (11) Authorization of Appropriations
       The House bill extends the authorization of appropriations 
     for the Food Stamp Act through FY2011. This includes the food 
     stamp program as well as the Food Distribution Program on 
     Indian Reservations. (Section 406(e))
       The Senate amendment extends the authorization of 
     appropriations for the Food Stamp Act through FY2006. This 
     includes the food stamp program as well as the Food 
     Distribution Program on Indian Reservations. (Section 435(d))
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization of appropriations 
     for the Food Stamp Act through FY2007. This includes the food 
     stamp program as well as the Food Distribution Program on 
     Indian Reservations. (Section 4122)
     (12) Puerto Rico and Territory of American Samoa
       The House bill extends Puerto Rico's nutrition assistance 
     block grant through FY2011, retaining annual indexing for 
     food-price inflation using changes in the cost of the Thrifty 
     Food Plan. It also authorizes the use of up to $6 million to 
     pay for upgrading and modernizing electronic data processing 
     systems and implementing systems to simplify eligibility 
     determinations without regard to the regular 50 percent 
     administrative cost matching requirement. (Section 406(f))
       The House bill extends American Samoa's nutrition 
     assistance grant through FY2011 and increases the size of the 
     annual grant to $5.75 million in FY2002 and $5.8 million a 
     year for FYs 2003-2011. (Section 406(g))
       The Senate amendment consolidates funding for Puerto Rico's 
     nutrition assistance block grant and American Samoa's 
     nutrition assistance grant and establishes the consolidated 
     ``mandatory'' grant through FY2006. The base consolidated 
     grant amount would be $1.356 billion (FY2002), which would 
     then be adjusted for food-price inflation using changes in 
     the cost of the Thrifty Food Plan starting with FY2003. Under 
     the terms of the consolidated grant, Puerto Rico would 
     receive 99.6 percent of the annual total. Of the amount paid 
     to Puerto Rico in FY2002, up to $6 million could be used to 
     pay for upgrading and modernizing electronic data processing 
     systems, implementing systems to simplify eligibility 
     determinations, and operating electronic benefit transfer 
     systems without regard to the regular 50 percent 
     administrative cost matching requirement. Not later than 270 
     days after enactment, the Senate amendment requires the GAO 
     to develop and submit a report to Congress that: describes 
     the similarities and differences (in program administration, 
     rules, benefits, and requirements) between the regular Food 
     Stamp program and Puerto Rico's nutrition assistance program; 
     specifies the costs and savings associated with each 
     similarity and difference; and? states the recommendation of 
     the GAO as to whether additional funding should be provided 
     to carry out Puerto Rico's nutrition assistance program. 
     Effective on the date of submission of the report, it 
     authorizes additional appropriations for the new consolidated 
     nutrition assistance block grant at a level of $50 million a 
     year.
       Under the terms of the consolidated grant, American Samoa 
     would receive .4 percent of the annual total. (Section 439)
       The Conference substitute adopts the Senate provision with 
     a number of amendments: authorizing the consolidated grant 
     through FY2007; deleting reference to the report and 
     authorization for appropriations; increasing the base 
     consolidated grant amount by (approximately $10 million per 
     year for Puerto Rico) to $1.401 billion in FY2003; allowing 
     carryover of up to two-percent of funds; allowing the one-
     time authority to use $6 million for upgrading and 
     modernizing electronic data processing systems, implementing 
     systems to simplify eligibility determinations, and operating 
     electronic benefit transfer systems without regard to the 
     regular 50 percent administrative cost matching requirement, 
     in either FY2002, FY2003 or in both years. (Section 4124)
     (13) Authorization of Appropriations: Assistance for 
         Community Food Projects
       The House bill extends the authority for community food 
     project grants through FY2011 and increases the amount 
     reserved to $7.5 million a year, beginning in FY2002. 
     (Section 406)
       The Senate amendment extends the authority for community 
     food project grants

[[Page H1935]]

     through FY2006; and maintains the amount reserved at $2.5 
     million a year. It also increases the federal share of 
     projects' costs to 75 percent.
       The Senate amendment broadens the list of projects that 
     must be given preference by: modifying the 4th preference 
     category to projects that encourage long-term planning 
     activities and multi-system, interagency approaches with 
     multi-stakeholder collaborations, that build the long-term 
     capacity of communities to address their food and agriculture 
     problems (such as food policy councils and food planning 
     associations); and adding a 5th preference category of 
     projects that meet (through grants not exceeding $25,000 
     each) specific neighborhood, local, or state food and 
     agriculture needs including: needs for infrastructure 
     improvement and development (purchase of equipment for 
     production, handling, or marketing of locally produced food), 
     needs for planning for long-term solutions, or needs for the 
     creation of innovative marketing activities that mutually 
     benefit farmers and low-income consumers. (Section 440)
       The Conference substitute adopts the House provision with 
     amendments to increase funding for the projects to $5 million 
     per year, extend the authority for community food project 
     grants through FY2007, and add additional language describing 
     other purposes for community food projects which must meet 
     specific state, local, or neighborhood food and agriculture 
     needs, including needs for infrastructure improvement and 
     development; planning for long-term solutions; or, the 
     creation of innovative marketing activities that mutually 
     benefit agricultural producers and low-income consumers.
       The Conference substitute includes language from former 
     Senate section 443 (``Innovative Programs for Addressing 
     Common Community Problems'') as a new subsection (h) and 
     provides funding for additional years such that not later 
     than 90 days after enactment, and on October 1 of each of 
     fiscal years 2003 through 2007, the Secretary must allocate 
     $200,000 out of the funds made available under this section, 
     to implement subsection (h), and to remain available until 
     expended. The Conference language permits the Secretary in 
     selecting a non-governmental organization (NGO) to carry out 
     this provision to either contract with that NGO or provide a 
     grant to that NGO indicating the responsibilities to be 
     completed for the $200,000. (Section 4125)
       As was the case with the Senate amendment, the Managers 
     intend that the NGO selected by the Secretary to carry out 
     this subsection shall: be experienced in gathering relevant 
     information about successful innovative programs; be 
     experienced in working with other targeted entities (NGOs, 
     federal agencies, states, and political subdivisions) and be 
     experienced in providing information about such innovative 
     programs; and be experienced in operating a national 
     information clearinghouse. In addition, the Managers intend 
     that the NGO selected under subsection (h) shall contribute 
     in-kind resources toward implementation of any contract or 
     grant and should be prepared to coordinate with targeted 
     entities and with the Community Food Security Coalition.
     (14) Authorization of Appropriations: Availability of 
         Commodities for Emergency Food Assistance Programs
       The House bill extends the requirement to purchase 
     commodities for The Emergency Food Assistance Program (TEFAP) 
     through FY2011 and increases to $140 million a year through 
     FY2011 the amount of commodities the Secretary must purchase 
     for TEFAP. Beginning in FY2002, the House bill requires the 
     Secretary to use $10 million a year of the TEFAP funds to pay 
     for direct and indirect costs related to processing, storing, 
     transporting, and distributing commodities, including gleaned 
     commodities. (Section 406(i))
       The Senate amendment extends the requirement to purchase 
     commodities for TEFAP through FY2006 and increases the amount 
     reserved for TEFAP to $110 million a year for FY2002-2006. 
     The provision setting aside $10 million a year is the same as 
     the House bill, but through FY2006. (Section 441)
       The Conference substitute adopts the House funding level of 
     $140 million a year with an amendment extending the 
     purchasing requirement through FY2007, eliminating the $10 
     million a year set-aside, and increasing the authorization of 
     appropriations from $50 million to $60 million a year for 
     direct and indirect costs related to processing, storing, 
     transporting, and distributing commodities, including gleaned 
     commodities. (Section 4126)


                   Subtitle B--Commodity Distribution

     (15) Distribution of Surplus Commodities to Special Nutrition 
         Projects
       The House bill extends this requirement through FY2011. 
     (Section 441)
       The Senate amendment reauthorizes the commodity 
     distribution program through FY2006. (Section 451(c))
       The Conference substitute adopts the Senate provision with 
     an amendment to reauthorize the program through FY2007. 
     (Section 4203)
     (16) Commodity Supplemental Food Program
       The House bill reauthorizes the commodity supplemental food 
     program through FY2011. (Section 442)
       The Senate amendment reauthorizes the commodity 
     supplemental food program through FY2006. (Section 451(a))
       The Senate amendment also replaces the current rule 
     limiting administrative payments to 20 percent of the 
     Commodity Supplemental Food Program (CSFP) appropriation with 
     a requirement for ``grants per caseload slot.'' The amendment 
     requires the Secretary to provide each state CSFP agency 
     (from discretionary funds for the current year or carried 
     over) an administrative grant per assigned caseload slot, as 
     follows: for FY2003, the grant would be $50 per assigned 
     caseload slot adjusted for the percentage change in the state 
     and local government price index of the Bureau of Economic 
     Analysis between the 12-month period ending June 30, 2001, 
     and the 12-month period ending June 30, 2002. For later 
     years, the per-slot grant would be adjusted in the same 
     manner. (Section 451(b))
       The Conference substitute adopts the Senate provision with 
     amendments reauthorizing the program through FY2007; 
     requiring the Secretary to use the FY2001 fiscal year grant-
     per-assigned slot as the baseline from which the 
     administrative cost grant per assigned caseload slot is 
     calculated, rather than using $50 as the base; requiring the 
     Secretary to spend the amount necessary to permit all states 
     that began to participate in the Commodity Supplemental Food 
     Program in the FY2000 caseload cycle to participate at a 
     caseload level not less than their originally assigned 
     caseload through the FY2002 caseload cycle , as determined by 
     the Secretary. Funding from the Commodity Credit Corporation 
     (CCC) is provided to permit the Secretary to alleviate an 
     unusual situation that has arisen in two states that have 
     recently implemented the CSFP. This is a one-time emergency 
     use of CCC funds and is not intended as a precedent for 
     drawing on the CCC to supplement appropriations for the CSFP. 
     (Section 4201)
     (17) Emergency Food Assistance
       The House bill reauthorizes TEFAP administrative cost 
     appropriations through FY2011 and revises the definition of 
     costs to be covered to include the costs to the states 
     related to the processing, storage, transporting, and 
     distributing commodities. (Section 443)
       The Senate amendment reauthorizes TEFAP administrative cost 
     appropriations through FY2006 and revises the definition of 
     costs to be covered to include the costs to the states 
     related to the processing, storage, transporting, and 
     distributing commodities. (Section 451(d))
       The Conference substitute adopts the House provision with 
     an amendment to reauthorize TEFAP administrative costs 
     through FY2007. (Section 4204)


                  Subtitle C--Miscellaneous Provisions

     (18) Hunger Fellowship Program
       The House bill establishes an independent agency of the 
     Legislative Branch of the U.S. government, the Congressional 
     Hunger Fellows Program. (Section 461)
       The Senate amendment establishes a Congressional Hunger 
     Fellowship. This formalizes an internship program already 
     being carried out by the Congressional Hunger Center and 
     funded under annual appropriations bills. (Section 462)
       The Conference substitute adopts the House provision but 
     deletes a reference to ``a commitment to social change'' as a 
     required attribute for fellows. In addition, it directs the 
     program to make available to the General Accounting Office 
     the salaries of the Executive Director and personnel, in 
     addition to the other materials already included, to carry 
     out audits. (Section 4404)
     (19) General Effective Date
       The House bill designates that the amendments made by this 
     title shall take effect on October 1, 2002, unless otherwise 
     specified. (Section 462)
       The Senate amendment designates that the amendments made by 
     this title shall take effect on September 1, 2002, except 
     that a state agency may elect to implement any or all of the 
     amendments on October 1, 2002. (Section 464)
       The Conference substitute adopts the House provision. 
     (Section 4405)
     (20) Payment limitations; Nutrition and Commodity Programs
       The Senate amendment increases the cap on the amount that 
     may be claimed as an excess shelter expense deduction. For 
     FY2003, the cap would be $390 a month for the 48 states and 
     the District of Columbia, $624 for Alaska, $526 for 
     Hawaii, $458 for Guam, and $307 for the Virgin Islands. 
     For FY2004-FY2009, amounts would be annually adjusted for 
     changes in the Consumer Price Index for All Urban 
     Consumers (CPI-U). Effective, FY2010, the cap is 
     eliminated. (Section 169(c)(2))
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (21) Encouragement of Payment of Child Support
       The Senate amendment permits states to (1) exclude 
     completely from a household's counted income any legally 
     obligated child support payments made by a household member 
     (before calculating any deductions) or (2) continue to deduct 
     them in the calculation of net income (as under current law). 
     Regardless of a state's exclusion or deduction choice, the 
     Senate amendment requires the Secretary to establish 
     simplified procedures that allow a state option to determine 
     the amount of child support paid. These must include 
     procedures that permit states to rely on information from 
     state child support enforcement agencies about

[[Page H1936]]

     payments made in prior months in lieu of obtaining current 
     information from the household. The amendment also allows 
     states to freeze the amount of any child support payment 
     exclusion or deduction until the eligibility of the household 
     is re-determined. (Section 411)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     a technical amendment and an amendment that deletes the state 
     option to freeze the amount of child support payment 
     exclusion or deduction. In addition, states are allowed to 
     rely on information from child support enforcement agencies 
     about payments made in prior months. (Section 4101)
     (22) Simplified Determination of Housing Costs
       The Senate amendment mandates that states treat any 
     required payment to a landlord as a housing or shelter cost 
     when determining a household's shelter expenses for 
     application of the excess shelter expense deduction. The 
     payments are included without regard to the specific charges 
     they cover. It also permits states to allow homeless 
     households not receiving free shelter throughout the month to 
     choose a standard shelter deduction from income (set by law 
     at $143 a month) in lieu of any excess shelter expense 
     deduction. Sates could deny this deduction to households with 
     extremely low shelter costs. Homeless households would 
     continue to be permitted to choose the regular excess shelter 
     expense deduction that is based on actual shelter costs. 
     (Section 414)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that strikes the section mandating that states 
     treat any required payment to a landlord as a housing or 
     shelter cost when determining a household's shelter expenses 
     for application of the excess shelter expense deduction. It 
     does, however, permit states to allow homeless households not 
     receiving free shelter throughout the month to receive a 
     standard deduction from income in lieu of any excess shelter 
     expense deduction.
       The Conference substitute deletes the Senate provision that 
     allows all required payments to landlords to count as 
     eligible shelter costs for the purpose of calculating a food 
     stamp excess shelter expense deduction. The Secretary should 
     review current rules governing allowable shelter costs and 
     their implementation and identify any means, within existing 
     authority, to modify or communicate these rules in a manner 
     that makes the determination of eligible shelter costs less 
     complicated and error prone for food stamp participants and 
     eligibility workers. (Section 4105)
     (23) Simplified Utility Allowances
       The Senate amendment allows states choosing to make 
     standard utility allowances (SUAs) mandatory to do so without 
     regard to the current metered public housing and prorating 
     rules. SUAs could be used in lieu of actual costs for all 
     households incurring a heating or cooling expense and covered 
     by a mandatory SUA without having to determine their utility 
     metering status or prorated expenses. (Section 415)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4104)
     (24) Simplified Procedure for Determination of Earned Income
       The Senate amendment allows states to elect to determine 
     monthly-earned income by multiplying weekly income by 4 and 
     biweekly income by 2. The amendment requires states making 
     this election to adjust the earned income deduction (normally 
     20 percent of earnings) downward for all households with 
     earnings to the extent necessary to prevent the election from 
     resulting in increased benefit costs consistent with 
     standards promulgated by the Secretary. (Section 416)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (25) Simplified Determination of Deductions
       The Senate amendment establishes a state option to 
     disregard most types of changes in household circumstances 
     that affect the amount of those deductions until the next 
     determination of eligibility. The amendment makes clear that 
     states are not permitted to disregard (1) any reported change 
     in residence or (2) under standards prescribed by the 
     Secretary, any change in earned income. (Section 417)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     States will be able to disregard changes in: household size; 
     the costs for dependent care; the amount of child support 
     payments; medical expenses for elderly or disabled 
     individuals; and shelter costs, unless they were the result 
     of a move. (Section 4106)
     (26) Simplified Definition of Resources
       The Senate amendment requires the Secretary to promulgate 
     regulations under which a state may exclude any types of 
     financial resources that it does not consider when 
     determining eligibility for cash assistance under its TANF 
     program, or medical assistance under its Medicaid program. 
     This authority would not allow the exclusion of cash, 
     vehicles (except to the extent states already are allowed to 
     use their TANF standard to exclude vehicles), and readily 
     available amounts in any account in a financial institution, 
     or any similar type of resource the Secretary judges 
     essential to equitable determinations of eligibility. The 
     intent of this provision is to align with, to the extent 
     possible, Medicaid and TANF rules. The Secretary will only 
     count types of resources that are required by law or 
     judged to be absolutely essential to equitable 
     determinations of eligibility in the food stamp program. 
     (Section 418)
       The Senate amendment also adds households with disabled 
     members to those covered by the current $3,000 liquid asset 
     limit applied to the elderly. (Section 171(c)(1))
       The House bill contains no comparable provisions.
       The Conference substitute adopts the Senate provisions. 
     (Section 4107)
     (27) Alternative Issuance Systems in Disasters
       The Senate amendment allows the Secretary to adjust 
     issuance systems in disaster situations to take into account 
     any conditions that make reliance on EBT systems 
     impracticable, effectively permitting the issuance of cash or 
     other forms of benefits. (Section 419)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4108)
       The Managers expect the authority provided in this section 
     for alternative issuances in disaster programs will only be 
     used in the most extreme circumstances, after the Secretary, 
     working with the state, has exhausted all other means of 
     benefit delivery and determined that electronic systems 
     cannot be restored in a timely fashion and that the use of 
     food coupons is impractical.
     (28) State Option to Reduce Reporting Requirements
       The Senate amendment allows states to establish semi-annual 
     reporting requirements for any household, independent of the 
     presence of earners or other characteristics. However, 
     households required to report less often than once each 3 
     months are required to report, in a manner prescribed by the 
     Secretary, if their income exceeds the food stamp gross 
     income eligibility limit (130 percent of the federal poverty 
     income guidelines). (Section 420)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4109)
     (29) Benefits for Adults Without Dependents
       The Senate amendment changes the ``3-months-out-of-36 
     months'' rule to make able-bodied adults without dependents 
     (ABAWDs) ineligible if, during the preceding 24 months they 
     received benefits for 6 months while not meeting work-related 
     requirements. ABAWDS ineligible under this new ``6-months-
     out-of-24-months'' rule may become eligible during any period 
     in which they work 20+ hours a week, participate in a work 
     program 20+ hours a week, or participate in a workfare 
     program. In implementing the new ``6-months-out-of-24-
     months'' rule, states are required to disregard any period 
     before enactment during which an individual received food 
     stamps.
       The Senate amendment changes the definition of a qualifying 
     work program to include job search or job search training 
     programs if (1) they meet standards set by the Secretary to 
     ensure that participants are continuously and actively 
     seeking private-sector employment and (2) no position is 
     available for the participant in another employment or 
     training program. (Section 421)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (30) Preservation of Access to Electronic Benefits
       The Senate amendment requires that no benefits provided 
     through EBT systems be taken ``off-line'' (or otherwise made 
     inaccessible) because of inactivity until at least 180 days 
     have elapsed since the recipient household last accessed the 
     account. Where benefits are taken off-line or made 
     inaccessible, it requires that the household be sent a notice 
     that explains how to reactivate benefits and offers 
     assistance if the household is having difficulty doing so. 
     These requirements apply to states as they enter into EBT 
     contracts. (Section 422)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (31) Cost Neutrality for Electronic Benefit Transfer Systems
       The Senate amendment eliminates the current requirement 
     that EBT systems not cost the federal government more than 
     the prior paper issuance systems. (Section 423)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4110)
       The Managers encourage the Department to continue its cost 
     containment and competition efforts and its efforts to work 
     with the states on this issue. Information about these 
     efforts will be provided in the report detailed in Section 
     4110.
     (32) Alternative Procedures for Residents of Certain Groups' 
         Facilities
       The Senate amendment provides a state option that allows 
     the provision of an inflation-adjusted standardized monthly 
     benefit

[[Page H1937]]

     to residents of group homes, rather than going through the 
     individualized benefit calculation for each resident. The 
     group homes that are eligible include those for the disabled; 
     shelters for battered women/children or the homeless, and 
     substance abuse treatment centers. Recipients' benefits are 
     calculated according to standardized procedures established 
     by the Secretary and take into account benefits typically 
     received by recipients in these group living facilities.
       States shall issue benefits to the facility (as an 
     authorized representative), and the Secretary shall establish 
     procedures to ensure that the facility does not receive a 
     greater proportion of a recipient's monthly benefits than the 
     proportion of the month during which the recipient lived 
     there.
       Group living facilities are required to (1) notify the 
     state when a recipient departs and (2) notify the recipient 
     that the recipient is eligible for continued benefits and 
     should contact the state about continuation of benefits.
       On receiving notification that a recipient has departed a 
     group living facility, the state is required to issue the 
     recipient a benefit allotment covering the remainder of the 
     month (calculated in a manner prescribed by the Secretary) 
     unless the recipient re-applies for food stamps or the state 
     cannot locate the recipient. The state also is permitted to 
     issue a benefit allotment for the month following departure 
     calculated under the standardized procedures used to set the 
     amount received while the departed recipient lived in the 
     group living facility. Recipients who have left group 
     facilities and re-apply for food stamps will have their 
     benefits determined under regular food stamp rules. (Section 
     424)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to convert this provision to a pilot program 
     that tests, at the request of a state agency or state 
     agencies, the feasibility of the alternative procedures for 
     determining allotments for residents of groups living in 
     certain group facilities. If an insufficient number of pilot 
     projects are proposed by state agencies or the Secretary 
     concludes that this is not in the best interest of the food 
     stamp program, the Secretary must inform the Senate Committee 
     on Agriculture, Nutrition, and Forestry and the House 
     Committee on Agriculture, and will not implement this 
     provision nationwide. (Section 4112)
     (33) Redemption of Benefits Through Group Living Arrangements
       The Senate amendment allows the Secretary to authorize 
     group living facilities to redeem food stamp benefits through 
     direct use of EBT cards, if they are equipped with ``point-
     of-sale'' devices. This provision allows authorized group 
     living facilities to continue a practice they have been 
     carrying out using waiver authority. (Section 425)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4113)
     (34) Availability of Food Stamp Program Applications on the 
         Internet
       The Senate amendment requires states to make food stamp 
     applications available on their agencies' Internet websites 
     in each language in which printed applications available. 
     (Section 426)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change the effective date for this provision 
     to 18 months after enactment of this Act. Section 504 of the 
     Rehabilitation Act requires state agencies to make their web 
     sites accessible to people with disabilities. The requirement 
     includes ensuring that documents are in a format in which 
     browsers for the visually impaired can read them, and that 
     they can be converted to Braille documents; that graphic 
     elements that convey meaning have text explanations 
     available; and that English language text is also available 
     in other languages, as appropriate. Many states have already 
     adopted standards that comply with this requirement. States 
     should, therefore, not incur additional costs to put their 
     food stamp application forms on their web sites. (Section 
     4114)
     (36) Simplified Determinations of Continuing Eligibility
       The Senate amendment provides for procedures for re-
     determining recipient households' continuing eligibility that 
     are consistent with re-determination procedures in other 
     programs serving low-income families. It replaces assigned 
     certification periods and the rules governing recertification 
     with new ``eligibility review periods'' under which states 
     periodically review the eligibility status of recipient 
     households. Eligibility review periods are up to 12 months 
     (or 24 months if all adult household members are elderly or 
     disabled), and states are required to have at least 1 contact 
     with each household every 12 months. Eligibility review 
     periods are not necessarily assigned to each household when 
     their eligibility is established. Instead, states are 
     mandated to periodically require each household to cooperate 
     in a re-determination of eligibility. Each re-determination 
     is based on information supplied by the household and has to 
     conform to standards established by the Secretary, and the 
     interval between redeterminations cannot exceed 12 or 24 
     months. Where households are found ineligible (or eligible 
     for a reduced amount) in their re-determination, they can 
     continue to receive benefits until the conclusion of any fair 
     hearing process. (Section 427)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (37) Clearinghouse for Successful Nutrition Education Efforts
       The Senate amendment requires the Secretary to (1) ask 
     states for descriptions of successful nutrition education 
     programs for the food stamp and other nutrition assistance 
     programs, (2) make them available on the Agriculture 
     Department's website, and (3) inform states of their 
     availability on the website. (Section 428)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. In 
     March 2002, the U.S. Department of Agriculture unveiled a 
     Website that features a clearinghouse for nutrition education 
     efforts described in the Senate amendment.
     (38) Delivery to Retailers of Notices of Adverse Action
       The Senate amendment permits notices of adverse action 
     against retailers to be delivered by any form of delivery 
     that the Secretary determines will provide evidence of 
     delivery. (Section 430)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4117)
     (39) Improvement of Calculation of State Performance Measures
       The Senate amendment changes the deadline for completion of 
     error-rate determinations and arbitration of state-federal 
     differences to May 31st; it also changes the deadline for the 
     determination of final error rates and claims against states 
     to June 30th. (Section 432)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4119)
     (40) Coordination of Program Information Efforts
       The Senate amendment permits states to use Temporary 
     Assistance for Needy Families (TANF) funds to conduct food 
     stamp information informational activities. (Section 436)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
       The Managers understand that, to further the purposes of 
     TANF, it is current policy to allow states to use TANF (and 
     ``maintenance of effort'') funds for food stamp informational 
     activities directed to families, long as they do not also 
     charge these same costs to the food stamp program. The 
     Managers expect the Secretary and the Secretary of Health and 
     Human Services to issue guidance that clearly informs states 
     of this policy.
     (41) Expanded Grant Authority
       The Senate amendment extends the Secretary's waiver 
     authority to cover any and all contracts and grants 
     authorized under this section. (Section 437)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4123)
     (42) Access and Outreach Pilot Programs
       The Senate amendment requires the Secretary to make grants 
     to states and other entities to pay the federal share (75 
     percent) of the cost of projects to improve access to food 
     stamp benefits or outreach to eligible individuals. It 
     authorizes appropriations totaling $3 million for FY2003-
     FY2005 for pilot programs and requires the Secretary to 
     evaluate funded projects, but limits spending on evaluations 
     to no more than 10 percent of funds made available. Criteria 
     for selecting grantees are to be developed by the Secretary 
     and include a record of serving low-income individuals, 
     ability to reach hard-to-serve populations, innovative 
     proposals in the application, and the development of public-
     private partnerships and community linkages. Preference is 
     required for project partnerships between states and private/
     public entities (e.g., food banks, community-based 
     organizations, public schools and health clinics, nonprofit 
     health or welfare agencies). At least 1 grantee has to be 
     selected from each Food and Nutrition Service (FNS) region 
     and additional rural or urban areas chosen by the Secretary. 
     The Secretary is not required to select grantees where an 
     insufficient number of applications have been received. 
     (Section 438)
       The House bill contains no comparable provision.
       The Conference substitute combines Section 405 of the House 
     Bill with Section 438 of the Senate amendment, as described 
     in Section 4116: ``Grants for simple application and 
     eligibility determination systems and improved access to 
     benefits.''
     (43) Use of Approved Food Safety Technology
       The Senate amendment bars the Secretary from prohibiting 
     the use of ``any technology that has been approved by the 
     Secretary or the Secretary of Health and Human Services'' in 
     acquiring commodities for distribution through TEFAP, the 
     Food Distribution Program on Indian Reservations (FDPIR), the 
     Commodity Supplemental Food Program (CSFP), and programs 
     under the Richard B.

[[Page H1938]]

     Russell National School Lunch Act and the Child Nutrition 
     Act. This bar is effective on enactment. (Section 442)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     a technical amendment that clarifies that the Secretary 
     cannot prohibit the use of any technology to improve food 
     safety that has been approved or is otherwise allowed by the 
     Secretary or the Secretary of Health and Human Services. In 
     implementing this provision, the Secretary is not expected to 
     set aside established, well-founded procurement practices. 
     (Section 4201)
       The Managers expect the Secretary to continue to make 
     commodity purchases, taking into consideration the 
     acceptability by recipients of products purchased and 
     considering the relative costs of products available for 
     purchase.
     (44) Innovative Programs Addressing Common Community Problems
       The Senate amendment requires the Secretary to offer a 
     contract to a non-governmental organization to coordinate 
     with federal agencies, states, political subdivisions, and 
     nongovernmental organizations (``targeted entities'') to 
     develop, and recommend to the targeted entities, innovative 
     programs for addressing ``common community problems'' 
     including loss of farms, rural poverty, welfare dependency, 
     hunger, the need for job training, juvenile crime prevention, 
     and individuals' and communities' need for self-sufficiency. 
     The organization must be selected competitively and must (1) 
     be experienced in working with targeted entities and 
     organizing workshops that demonstrate programs to targeted 
     entities, (2) be experienced in identifying programs that 
     effectively address ``common community problems,'' (3) agree 
     to contribute in-kind resources and provide targeted entities 
     information free of charge, (4) be experienced in and capable 
     of receiving information from (and communicating with) 
     targeted entities throughout the U.S., and (5) be experienced 
     in operating a national information clearinghouse that 
     addresses ``common community problems.'' It also makes 
     available to the Secretary mandatory funding totaling 
     $400,000 to carry out the contract in two installments 
     effective on enactment.
       This Senate provision was based in part on a project 
     (called ``Reinvesting in America'') in which a non-profit 
     group headquartered in New York, called World Hunger Year, 
     gathered information about successful innovative local 
     programs and then advised other NGOs, communities, or city, 
     state or federal agencies (targeted entities) about these 
     successful projects and about how to replicate them. This 
     turned out to be a very efficient approach because other 
     communities or agencies would be aware of the lessons learned 
     by the community that originated the idea. World Hunger Year 
     held ``replication workshops'' in which they advised these 
     targeted entities about how to replicate those successful 
     programs in other areas. World Hunger Year officials also 
     provided information about some of these programs to the 
     Community Food Security Coalition and to federal Departments. 
     (Section 443)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. The 
     Conference substitute includes a variation of this provision 
     in House Section 440, as described in Section 4125.
     (45) Report on Use of Electronic Benefit Transfer Systems
       The Senate amendment requires the Secretary to submit a 
     report to Congress on (1) difficulties relating to use of EBT 
     systems, (2) the extent of fraud and the types of fraud that 
     exist, and (3) the efforts being made by the Secretary, 
     retailers, EBT contractors, and states to address 
     difficulties and fraud in EBT systems. The report is due no 
     later than one year after enactment. (Section 444)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that changes the elements to be included in the 
     report. The report will include: a description of the status 
     of statewide EBT implementation in the food stamp program; an 
     indication of the number of vendors that currently hold an 
     EBT-related contract with the states; information on the 
     number of states that are working with multiple vendors and a 
     description of how responsibilities are divided among the 
     various vendors and other organizations within a given state; 
     an explanation of the reasons any state is not operational 
     statewide by October 1, 2002, how these issues are being 
     addressed, and the expected date for statewide EBT 
     operations; a description of the issues faced by any states 
     that have awarded a second EBT contract in the last two years 
     and the steps taken to resolve them; a description of the 
     issues faced by any states that will award a second EBT 
     contract within the next two years and strategies they are 
     considering to address these issues; initiatives being 
     considered or taken by USDA, food retailers, EBT vendors, 
     and client advocates to address any outstanding issues 
     with respect to EBT systems; and an examination of areas 
     of potential advances in electronic benefit delivery in 
     the next 5-10 years including but not limited to access to 
     electronic benefits in farmers' markets, increased use of 
     EBT transaction data to identify and prosecute fraud, and 
     the fostering of increased EBT vendor competition to 
     ensure cost-containment and optimal service. (Section 
     4111)
     (46) Vitamin and Mineral Supplements
       The Senate amendment adds dietary supplements that 
     ``provide exclusively 1 or more vitamins or minerals'' to the 
     food items that may be purchased with food stamp benefits.
       Not later than April 1, 2003, the amendment requires the 
     Secretary to contract with a scientific research organization 
     to study and develop a report on technical issues, economic 
     impacts, and health effects associated with allowing 
     individuals to use food stamp benefits to purchase dietary 
     vitamin-mineral supplements. The report is to be submitted to 
     the Secretary no later than 2 years after the contract is 
     entered into. The Senate amendment authorizes $3 million for 
     the report. At a minimum, the report is to examine: the 
     extent to which problems arise in the purchase of vitamin-
     mineral supplements with EBT cards; the extent of any 
     difficulties in distinguishing vitamin-mineral supplements 
     from herbal and botanical supplements (for which food stamp 
     benefits may not be used); whether recipients spend more on 
     vitamin-mineral supplements than non-recipients; the extent 
     to which vitamin-mineral supplements are substituted for 
     other foods purchased with food stamp benefits; the 
     proportion of the average food stamp allotment that is being 
     used to purchase vitamin-mineral supplements; and the extent 
     to which the quality of recipients' diets has changed as the 
     result of allowing them to use food stamp benefits to 
     purchase vitamin-mineral supplements. (Section 445)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (47) Partial Restoration of Benefits to Legal Immigrants
       The Senate amendment makes legal permanent residents under 
     age 18 eligible for food stamps without regard to date of 
     entry. It also exempts them from requirements that their 
     sponsors' financial resources be deemed to them in 
     determining food stamp eligibility. The Senate amendment also 
     reduces the work history requirement for legal permanent 
     residents' eligibility for food stamps to 16 quarters (4 
     years); removes the 7-year limit on eligibility for refuges 
     and people seeking asylum, Cuban/Haitian entrants, certain 
     aliens whose deportation is being withheld for humanitarian 
     reasons, and Vietnam-born Americans fathered by U.S. 
     citizens; and makes eligible legal permanent residents 
     receiving government disability benefits regardless of date 
     of entry so long as they meet any non citizen test applied by 
     the program under which they receive benefits. (Section 452)
       Effective April 1, 2003, the Senate amendment makes 
     eligible individuals who have continuously resided in the 
     U.S. as ``qualified aliens'' for a period of 5 years or more 
     beginning on the date on which the qualified alien entered 
     the U.S. However, eligibility based on this new 5-year 
     residence rule would not apply in the case of an alien who 
     enters the country illegally and remains illegally for a 
     period of one year or more (or has been an ``illegal alien'' 
     for one year or more) unless the alien has continuously 
     resided in the U.S. for a period of 5 years or more as of the 
     ``date of enactment.'' (Section 170(b) and (c))
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that eliminates the provision that restricts 
     application of the new 5-year residence rule by denying it to 
     aliens who enter the country illegally and remain illegally 
     for a period of one year or more. The substitute also 
     eliminates the provision that changes the work history 
     requirement provision for legal permanent residents' from 40 
     quarters (in current law) to 16 quarters and the removal of 
     the 7-year limit on the length of time that refugees and 
     people seeking asylum may participate in the program. The 
     Managers note that application of the new 5-year residence 
     rule to refugees and asylees has the same effect as lifting 
     the 7-year limit. (Section 4401)
     (48) Commodities for School Lunch Programs
       The Senate amendment extends, until FY2004, provisions of 
     current law that remove a mandate that any ``bonus'' 
     commodities acquired for agricultural support purposes and 
     donated to schools be counted toward a minimum requirement 
     that 12 percent of all school lunch assistance be in the form 
     of commodities. The provision, therefore, mandates that only 
     entitlement commodities count toward the 12 percent 
     requirement through FY2003. (Section 453)
       The House bill contains no comparable provisions.
       The Conference substitute adopts the Senate provision. 
     (Section 4301)
     (49) Eligibility for Free and Reduced-Price School Meals: 
         Military Housing
       Effective on enactment and through FY2003, the Senate 
     amendment requires that, in cases where military personnel 
     live in ``privatized'' housing, their housing allowance not 
     be counted as income in determining eligibility for free and 
     reduced-price school meals. (Section 454)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4302)
     (50) Eligibility for Assistance Under the Special 
         Supplemental Nutrition Program From Women, Infants, and 
         Children
       Effective on enactment, the Senate amendment adds an option 
     for states to exclude

[[Page H1939]]

     any housing allowance in cases in which military personnel 
     live in ``privatized'' housing whether on base or off base. 
     (Section 455)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4306)
     (51) Report on Conversion of the WIC Program Into an 
         Individual Entitlement Program
       The Senate amendment requires, no later than December 31, 
     2002, a report from the Secretary to the House Committee on 
     Education and the Workforce and the Senate Committee on 
     Agriculture, Nutrition, and Forestry that analyzes the 
     conversion of the WIC program from a discretionary program 
     into an individual entitlement program. It also requires the 
     Secretary to use funds made available to carry out the WIC 
     program to fund the cost of the report. (Section 456)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate amendment.
       The Managers expect that, in preparation for child 
     nutrition programs' reauthorization in FY2003, the Department 
     will work with the Congressional Budget Office, the Office of 
     Management and Budget and others to review the current WIC 
     funding approach and alternative approaches to ensure an 
     appropriate level of funding is available throughout the 
     fiscal year. Also in preparation for this legislation, the 
     Managers encourage the continued development, refinement, and 
     testing of a national standard for WIC electronic benefit 
     transfer (EBT) transactions. The Managers encourage the 
     completion of work on a national standard for WIC EBT 
     transactions prior to WIC reauthorization.
       In addition, the Managers understand that several states 
     differentiate between 100 percent fruit juice and blended 100 
     percent fruit juices in formulating an approved WIC list. The 
     Managers are aware that a number of factors are considered by 
     a state when selecting products for its approved WIC list. 
     The Managers encourage states not to limit the availability 
     of eligible food choices of WIC participants, and strongly 
     urge states to evaluate objectively the merits of WIC-
     eligible food products. The Managers encourage the Department 
     to provide guidance to the states, making them aware that 
     blended 100 percent fruit juices are permissible WIC 
     products.
     (52) Use of Commodities for Domestic Feeding Programs
       The Senate amendment provides that, notwithstanding any 
     provision of law concerning commodity donations, any 
     commodities acquired in the conduct of CCC operations and any 
     ``Section 32'' commodities may be used for any domestic 
     feeding program involving acquisition and use of commodities. 
     This authority applies to the extent that the commodities 
     involved are in excess of quantities needed to carry out 
     other obligations (including quantities otherwise reserved 
     for a specific purpose). The domestic feeding programs 
     covered by this authority include TEFAP, and programs 
     authorized under the Richard B. Russell National School Lunch 
     Act, the Child Nutrition Act, the Older Americans Act, or 
     other laws the Secretary determines appropriate. (Section 
     457)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 4202)
       The Managers recognize that, under current law, the source 
     of funding for the purchase of a particular commodity can 
     limit the eligible recipient programs. As a result, 
     distribution of commodities to the Department's School 
     Nutrition Programs and other domestic programs has sometimes 
     been difficult or prevented entirely. The limitation in the 
     current law has stymied the two-fold purposes of commodity 
     purchases--to support American agriculture and to provide 
     nutritious foods through our domestic feeding programs. For 
     purposes of this distribution authority, the Managers 
     consider eligible excess commodities to be those that are 
     purchased by the Commodity Credit Corporation or by the 
     Secretary and remain available after all other authorized 
     distributions, including distribution of specific quantities 
     reserved for specific purposes, have been satisfied. This 
     section allows more efficient, expeditious and direct 
     distribution of excess commodities by expanding the 
     Secretary's existing distribution authorities.
     (53) Purchase of Locally Produced Foods
       The Senate amendment requires the Secretary to: encourage 
     institutions participating in the School Lunch and Breakfast 
     programs to purchase locally produced foods, to the maximum 
     extent practicable and appropriate and in addition to other 
     food purchases; advise these institutions of the locally 
     produced food policy; and provide start-up grants to up to 
     200 institutions to defray initial costs of equipment, 
     materials, storage facilities, and similar costs incurred in 
     carrying out the locally produced food policy. Also it 
     authorizes appropriations of $400,000 a year for FY2002-
     FY2006. (Section 458)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision.
       The intent of the Managers is to authorize the Secretary to 
     award modest start-up grants for equipment, materials and 
     similar costs associated with purchasing locally produced 
     foods. It is not the intent to create a geographical 
     preference for purchases of locally produced foods or 
     purchases made with grant funds. All purchases are to be made 
     competitively, consistent with federal procurement laws and 
     regulations.
       The Conference substitute also includes an amendment that 
     treats Puerto Rico in the same way as Hawaii is treated under 
     the Buy America provision in the National School Lunch Act. 
     It extends, to the extent practicable, an advantage of 
     domestic grown or produced products over foreign products, to 
     Puerto Rico for purposes of the School Lunch Program. The Buy 
     America provision originally applied only to the 48 
     contiguous states with the later addition of Hawaii.
       The Managers want to make clear that school food 
     authorities are still required to follow federal procurement 
     rules calling for free and open competition and limit local 
     product purchases to those that are practicable. Furthermore, 
     while products from Puerto Rico will have an advantage over 
     foreign products, this provision will not give an advantage 
     to products produced or grown in one of the 48 contiguous 
     states or Hawaii. (Section 4303)
     (54) WIC Farmers' Market Nutrition Program
       The Senate amendment makes available an additional $15 
     million in mandatory funding for the WIC farmers' market 
     nutrition program no later than 30 days after enactment. 
     (Section 460)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment providing that funding for the program is made 
     available out of the Commodity Credit Corporation. This 
     emergency allocation of CCC funding to the WIC farmers' 
     market nutrition program is made to meet a one-time shortfall 
     and is not intended to set a precedent for the use of CCC 
     resources to support the WIC farmers' market nutrition 
     program. (Section 4307)
     (55) Fruit and Vegetable Pilot Program
       The Senate amendment requires the Secretary to use 
     ``Section 32'' funds to conduct a pilot program to make free 
     fruits and vegetables available to students in 25 schools in 
     each of four states and students in schools on one Indian 
     reservation, in the 2002-2003 school year. It also requires 
     an evaluation of the pilot to determine whether students take 
     advantage, whether interest increased or lessened over time, 
     and what effect the pilot has on vending machine sales and 
     sales of school meals. The Secretary is required to use 
     $200,000 in ``Section 32'' funds to carry out the 
     evaluation. The evaluation is to be conducted through the 
     Economic Research Service and submitted to the House 
     Committee on Education and the Workforce and the Senate 
     Committee on Agriculture, Nutrition, and Forestry not 
     later than one year after implementation of the pilot 
     program. (Section 461)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments: The pilot will begin in July 2002 and last one 
     year; free fresh and dried fruits and fresh vegetables will 
     be made available throughout the school day in one or more 
     areas designated by the school; not later than one year after 
     the implementation of the pilot program, the Secretary 
     (acting through the Economic Research Service) shall report 
     to the Committee on Education and the Workforce of the House 
     of Representatives and the Committee on Agriculture, 
     Nutrition, and Forestry of the Senate, the results of the 
     pilot program; $6 million of Section 32 funds shall be made 
     available to carry out this pilot program. (Section 4305)
       The Managers agree that the intent of the pilot program is 
     to determine the feasibility of carrying out such a program 
     and its success as determined by the students' interest in 
     participating in the program. The Managers encourage USDA to 
     work with the schools to collect information on the types of 
     schools that ultimately participate in the program, how 
     schools choose to implement the program (including 
     information on whether or not they incorporate nutrition 
     education), and reasons for different implementation 
     approaches. The Department is encouraged to find out from the 
     schools about lessons learned and whether or not (and why) 
     they are interested in continuing to participate in a similar 
     program. To the extent practical, the Department is also 
     asked to find out from teachers and/or students about 
     students' attitudes and actual behavior over the course of 
     time. The Managers recommend the selection of the following 
     four states to participate in the pilot: Indiana, Iowa, 
     Michigan, and Ohio. The Secretary will select the Indian 
     reservation and the schools within each of the states that 
     will participate in the pilot project.
     (56) Nutrition Information and Awareness Pilot Program
       The Senate amendment authorizes the Secretary to 
     establish--in not more than 15 states--a pilot program to 
     increase domestic consumption of fresh fruits and vegetables 
     and convey related health messages. It authorizes 
     appropriations of $25 million a year for FY2002-FY2006. The 
     federal share of project costs is 50 percent and funds are 
     not available to any foreign for-profit corporation. Where 
     practicable, the amendment requires the Secretary to: 
     establish the program in states where production of fresh 
     fruits and vegetables is a significant industry; and base the 
     program on ``strategic initiatives,'' including health 
     promotion and

[[Page H1940]]

     education interventions, public service and paid marketing 
     activities, and health promotion and social marketing 
     campaigns. In selecting states, the Senate amendment requires 
     the Secretary to take into account the state's experience in: 
     carrying out similar activities and its ability to be 
     innovative, conduct marketing campaigns to promote produce 
     consumption, track increases in levels of produce 
     consumption, and to optimize the availability of produce. 
     (Section 463)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments: establishing in not more than 5 states, and for a 
     period not to exceed 4 years for each participating state, a 
     pilot program for the purpose of increasing the domestic 
     consumption of fresh fruits and vegetables and conveying 
     related health promotion messages; funds may not be used to 
     disparage any other agricultural commodities and funds made 
     available to states under this program may not be provided by 
     a state to any foreign for-profit corporation; regarding the 
     Secretary selecting states to participate in the program, the 
     funds may be used to enhance existing state programs that are 
     consistent with the purposes of this section, and the 
     Secretary shall take into consideration states' experience in 
     carrying out similar projects or activities, innovative 
     approaches, and the ability of the state to promote and track 
     increases in levels of produce consumption; participating 
     states shall establish eligibility criteria under which the 
     states may select public and private sector entities to carry 
     out demonstration projects under this program ; authorizing 
     to be appropriated $10 million per fiscal year 2002 through 
     2007 to carry out this section. (Section 4403)

                            Title V--Credit

     1(1) Eligibility of Limited Liability Companies for Farm 
         Ownership Loans, Farm Operating Loans, and Emergency 
         Loans
       The House bill includes limited liability companies as 
     entities eligible for USDA farmer loan programs. (Sec. 501)
       The Senate amendment is identical to the House provision. 
     (Sec. 521)
       The Conference substitute adopts the House provision and 
     also includes trusts as eligible entities. (Sec. 532)
     (2) Suspension of Effectiveness of Certain Provision
       The House bill provides that Sec. 319(b) of the 
     Consolidated Farm and Rural Development Act (ConAct) limiting 
     loan eligibility of borrowers with Farm Service Agency loan 
     guarantees will have no effect through December 31, 2006. 
     (Section 501)
       The Senate amendment amends Sec. 311(c) of the ConAct by 
     adding new provisions--(1) to require the Secretary to waive 
     the direct OL loan eligibility limitations to a farmer or 
     rancher who is a member of an Indian tribe and whose 
     operation is within an Indian reservation; and (2) to 
     authorize the Secretary, on a case-by-case basis, to grant a 
     waiver for a direct OL loan to a borrower one time for a 
     period of two years if the borrower demonstrates, a) he has a 
     viable farm or ranch operation; b) he has applied for 
     commercial credit from two commercial lenders; c) he was 
     unable to obtain a commercial loan, including a loan 
     guarantee; and d) he has completed successfully or will 
     complete within one year a borrower's training course 
     required under Sec. 359 of the ConAct. (Section 502(b))
       The Conference substitute adopts the House provision with 
     regard to loan eligibility under Section 319 (b) of the 
     ConAct. (Sec. 512)
       The Conference substitute adopts the Senate provision with 
     regard to the case by case determination on the one time 
     waiver of two years. The substitute also permits the 
     Secretary to waive limitations with respect to direct loans 
     for farmers and ranchers who farm land subject to the 
     jurisdiction of an Indian Tribe, or when applicable security 
     interests are subject to such jurisdiction, if commercial 
     credit is not generally available. (Sec. 511)
     (3) Administration of Certified Lenders and Preferred 
         Certified Lenders Programs.
       The House bill amends Sec. 331(b) of the ConAct to add a 
     new provision authorizing the Secretary to administer the 
     certified and preferred lender guaranteed loan programs 
     through central offices in states or multi-state areas. (Sec. 
     503)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment to make the authority discretionary. (Sec. 539)
     (4) Simplified Loan Guarantee Application Available for Loans 
         of Greater Amounts.
       The House bill amends Sec. 333A(g)(1) of the ConAct to 
     increase the loan amount of the guaranteed program using a 
     simplified short form to a maximum of $150,000. (Sec. 504)
       The Senate amendment amends Sec. 333A(g)(1) to increase the 
     loan amount of the guaranteed program using a simplified 
     short from to $100,000. (Sec. 526)
       The Conference substitute sets the loan amount at $125,000. 
     (Sec. 537)
     (5) Elimination of Requirement That Secretary Require County 
         Committees To Certify in Writing That Certain Loan 
         Reviews Have Been Conducted
       The House bill strikes Sec. 333(2) of the ConAct to remove 
     the requirement that county committees must certify in 
     writing annually that farmer program borrowers' business 
     operations and credit histories have been reviewed for the 
     borrowers to continue to be eligible for the loan program. 
     (Sec. 505)
       The Senate amendment amends Sec. 333(2) by removing the 
     requirement that local or area FSA committees must certify in 
     writing that they have reviewed the credit histories, 
     business operations and continued eligibility of all 
     borrowers. The amendment retains language requiring that 
     these annual reviews be conducted. (Sec 525)
       The Conference substitute adopts the Senate provision. 
     (Sec. 536)
     (6) Authority To Reduce Percentage of Loan Guaranteed if 
         Borrower Income Is Insufficient to Service Debt
       The House bill amends Sec. 339(c)(4)(A) and (d)(4)(A) of 
     the ConAct dealing with the certified and preferred 
     guaranteed lending program to authorize the Secretary to 
     guarantee less than 80 percent of farm program loans even 
     though the borrower does not show adequate income as 
     described in current law. (Sec. 506)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (7) Timing of Loan Assessments
       The House bill strikes language in Sec. 360(a) of the 
     ConAct to conform to a provision of the 1994 USDA 
     Reauthorization Act that eliminated a requirement for the 
     local county committee to approve a borrower's eligibility 
     for farmer program loans. (Sec. 507)
       The Senate amendment amends Sec. 360(a) of the ConAct by 
     striking the words, ``established pursuant to section 332''. 
     (Sec 552(d))
       The Conference substitute adopts the House provision. (Sec. 
     546)
     (8) Making and Servicing of Loans by Personnel of State, 
         County or Area Committees
       The House bill amends Subtitle D of the ConAct to add a new 
     section 376 to require the Secretary to use Farm Service 
     Agency state, area or county office employees to make and 
     service farmer program loans if the personnel are trained to 
     do so. This authority overrides the 90-day finality rule of 
     FSA state, area or county office employees in Sec. 281(a)(1) 
     of the USDA reorganization act. (Sec. 508)
       The Senate amendment amends Sec. 281(a)(1) of the 
     Department of Agriculture Reorganization Act so that the 
     finality rule does not apply to an agricultural credit 
     decision made by a state, area or county FSA employee. (Sec. 
     551)
       The Conference substitute adopts the House provision. (Sec. 
     549)
       This section would enable the Secretary to employ personnel 
     of a State, county or area committee to make and service USDA 
     farm loans to the extent the personnel are trained to do so. 
     The Managers believe that the Secretary should provide that 
     these individuals have been adequately trained in these areas 
     in a comparable manner as USDA Farm Service Agency employees 
     with the same job responsibilities. Furthermore, the 
     Secretary should ensure that the credit decisions of these 
     individuals are subject to the same USDA loan review as any 
     USDA employee making credit decisions, including internal 
     control review, and disciplinary action to protect against 
     the misuse of government funds.
     (9) Eligibility of Employees of State, County, or Area 
         Committees for Loans and Loan Guarantees
       The House bill Amends Subtitle D of the ConAct to add a new 
     section 377 to make eligible Farm Service Agency local county 
     office employees and USDA employees for farmer program loans 
     so long as a local county office other than the applicant's 
     home office approves the loan application. (Sec. 509)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment providing that when applying for loans, local/
     county employees apply to the State level and State employees 
     apply to the federal level. (Sec. 550)
       This section would allow employees of a State, county or 
     area committee to be eligible for USDA farm loans as long as 
     these loans are approved at a higher level within the Farm 
     Service Agency, either at the state office or national level. 
     The Managers believe it is important for these employees, 
     many of whom are farmers in their communities, to have access 
     to the same farm loan programs as other producers. 
     Nevertheless, the Managers believe that a higher level of 
     review is appropriate to alleviate concerns regarding the 
     eligibility of these individuals for the farm loan programs.
     (10) Emergency Loans in Response to an Economic Emergency 
         Resulting From Sharply Increasing Energy Costs
       The House bill amends: (1) Sec. 321(a) of the ConAct to 
     include among natural disasters economic disasters caused by 
     high energy costs and crop and livestock quarantines for 
     which farmers, ranchers or persons engaged in aquaculture may 
     be eligible for disaster loans; (2) Sec. 323 of the ConAct to 
     conform disasters or emergencies referred to in this section 
     caused by plant or animal quarantines or sharply rising 
     energy costs; (3) Sec. 329 of the ConAct by adding a new 
     subsection (b) requiring the Secretary to make financial 
     assistance available when energy costs for any three-month 
     period is at

[[Page H1941]]

     least 50 percent greater than the average of the preceding 
     five years and the applicant's income loss was incurred to 
     prevent livestock mortality, degradation of perishable 
     commodities or damage to field crops; and (4) Sec. 324(a) 
     of the ConAct by adding two provisions to limit the amount 
     of any loan made in response to a quarantine to $500,000 
     and any loan made in response to an energy emergency to 
     $200,000. (Sec. 510)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision only 
     on providing new authority to make emergency loans for plant 
     or animal quarantines. (Sec. 521)
     (11) Extension of Authority To Contract for Servicing of 
         Farmer Program Loans
       The House bill reauthorizes the program in Sec. 331(d) of 
     the ConAct through 2011 to allow the Secretary to contract 
     with regulated financial institutions to service farmer 
     program loans under the ConAct and removes the ``temporary'' 
     designation of this program. (Sec. 511)
       The Senate amendment amends Sec. 331 by striking 
     subsections (d) [loan servicing pilot program for farm loans] 
     and (e) [authority for the Secretary to use private debt 
     collection agencies] and provides that any existing contracts 
     are unaffected by this provision. (Sec. 523)
       The Conference substitute adopts the Senate provision. 
     (Sec. 534)
     (12) Authorization for Loans
       The House bill amends Sec. 346(b)(1) by reauthorizing the 
     farmer loan programs at such sums as may be necessary. (Sec. 
     512)
       The Senate amendment amends Sec. 346(b)(1) of the ConAct by 
     providing not more than $3,796,000,000 for each of the fiscal 
     years 2002 through 2006.
       Of the above amount in each fiscal year, $770,000,000 shall 
     be for direct loans of which--
       (1) $205,000,000 shall be for farm ownership loans; and
       (2) $565,000,000 shall be for operating loans.
       Of the remainder of the above amount in each fiscal year, 
     $3,026,000,000 shall be for guaranteed loans of which--
       (1) $1,000,000,000 shall be for guaranteed farm ownership 
     loans; and--
       (2) $2,000,026,000 shall be for guaranteed operating loans. 
     (Sec. 529(1)(A))
       The Conference substitute adopts the Senate provision with 
     an amendment to provide the authorization from fiscal years 
     2002 to 2007. (Sec. 541)
     (13) Reservation of Funds for Direct Operating Loans for 
         Beginning Farmers and Ranchers
       The House bill amends Sec. 346(b)(2)(A)(ii)(III) of the 
     ConAct to reauthorize the reservation of beginning farmer and 
     ranchers loan amounts at 35 percent of the funds through 
     2011. (Sec. 513)
       The Senate amendment amends Sec. 346(b)(2)(A)(ii) of the 
     ConAct to provide that the Secretary shall reserve during 
     fiscal years 2002 through 2006 35 percent of the funds made 
     available for direct operating loans authorized to be 
     appropriated under the ConAct. Further, in addition to funds 
     made available under Agricultural Appropriations, the 
     Secretary shall use $5,000,000 of funds of the CCC for fiscal 
     year 2002 to make loans described in section 346(b)(2)(A)(i). 
     (Sec. 529(1)(B))
       The Conference substitute adopts the House provision with 
     an amendment to provide the authorization from fiscal years 
     2002 to 2007. (Sec. 542)
     (14) Extension of Interest Rate Reduction Program
       The House bill amends Sec. 351(a)(2) to reauthorize the 
     interest rate buy-down program for farmer program loan 
     guarantees through 2011. (Sec. 514)
       The Senate amendment amends Sec. 351 of the ConAct and 
     replaces subsection (c) by providing an interest rate 
     reduction of three percent for farmers and ranchers and four 
     percent for beginning farmers and ranchers; authorizes 
     $750,000,000 to carry out this program; and requires the 
     Secretary to reserve until April of each fiscal year not less 
     than 25 percent of the funds for the interest rate reduction 
     program for beginning farmers and ranchers. (Sec. 530)
       The Conference substitute adopts the Senate provision with 
     an amendment that retains current law on the interest rate, 
     but reserves 15% of funds in a fiscal year for beginning 
     farmers and ranchers until March 1st and provides for a 
     permanent authorization of $750 million annually. (Sec. 543)
     (15) Increase in Duration of Loans under Down Payment Loan 
         Program.
       The House bill amends Sec. 310E (b)(3) of the beginning 
     farmer and rancher down payment loan program by increasing 
     the loan repayment period to 15 years and makes a conforming 
     amendment to Sec. 310E (c)(3)(B). (Sec. 515)
       The Senate amendment amends Sec. 310E (b)(3) of the 
     beginning farmer and rancher down payment loan program by 
     increasing the repayment period to 20 years (Sec. 507(1)(B)). 
     The Senate amendment also makes a conforming amendment to 
     Sec. 310E (c)(3)(B). (Sec. 507(2))
       The Conference substitute adopts the House provision. (Sec. 
     505)
     (16) Horse Breeder Loans
       The House bill (1) defines a horse breeder as a person that 
     derives more than 70 percent of the income of the person from 
     the business of breeding, boarding, raising, training or 
     selling horses during the shorter of (a) the five-year period 
     ending on Jan. 1, 2001; or (b) the period the person has been 
     engaged in the business; (2) directs the Secretary to make a 
     loan to an eligible horse breeder for losses suffered from 
     mare reproductive loss syndrome; (3) defines eligible 
     breeders are those a) who suffered at least a 30 percent loss 
     of mare offspring as a result of mare reproductive loss 
     syndrome during the periods of Jan. 1, 2000-Oct. 1, 2000, or 
     Jan. 1, 2001-Oct. 1, 2001. Losses could be from mares having 
     failed to conceive, or miscarried, aborted or otherwise 
     failed to produce a live healthy foal. Mares could be owned 
     by a breeder or boarded on a farm owned, operated or leased 
     by a breeder; b) who, during the period Jan. 1, 2000, and 
     ending on Sept. 30, 2002, were unable to meet financial 
     obligations in connection with breeding, boarding, raising, 
     training, or selling horses; (c) who were unable to obtain 
     sufficient credit elsewhere (within the meaning of Sec. 
     321(a) of the ConAct; (4) directs the Secretary shall 
     determine the amount of the loan based on the amount losses 
     suffered by a breeder but a loan may not exceed $500,000; (5) 
     directs the Secretary shall determine the duration of the 
     loan but any loan may not exceed 15 years; (6) establishes 
     the interest rate shall be at a rate prescribed by Sec. 
     324(b)(1) of the ConAct; (7) directs the Secretary shall take 
     a security interest in the loan; (8) establishes that a 
     breeder must submit a loan application by Sept. 30, 200; 
     (9) directs the Secretary shall carry out this section 
     using funds made available for the emergency loan program 
     under subtitle C of the ConAct; and (10) establishes the 
     authority for this loan program expires on Sept. 30, 2003. 
     (Sec. 516)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (17) Evaluations of Direct and Guaranteed Loan Programs
       The House bill (1) requires the Secretary to conduct two 
     studies of the direct and guaranteed farm ownership and 
     operating loan programs. Each will include an examination of 
     the number, average principal amount, and delinquency and 
     default rates of loans during the period covered by the 
     study. (2) The first study shall cover the one-year period 
     that begins one year after enactment. The second study shall 
     cover the one-year period that begins three years after 
     enactment. (3) At the end of the period covered by each 
     study, the Secretary shall submit reports to Congress that 
     contains an evaluation of the results of the study, including 
     an analysis of the effectiveness of the loan programs in 
     meeting the credit needs of agricultural producers. (Sec. 
     517)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. (Sec. 
     531)
     (18) Loan Eligibility for Borrowers With Prior Debt 
         Forgiveness
       The House bill amends Sec. 373(b)(1) of the ConAct to 
     authorize the Secretary to make loans to borrowers who have 
     not received debt forgiveness on loans or loan guarantees 
     more than two times and to guarantee loans to borrowers who 
     have not received debt forgiveness on loans or loan 
     guarantees more than three times. (Sec. 519)
       The Senate amendment contains no comparable provisions.
       The Conference substitute deletes the House provision and 
     provides for the Secretary to make an operating loan to a 
     borrower who has received debt forgiveness on not more than 
     one occasion that was directly and primarily resulting from a 
     natural disaster as designated by the President. (Sec. 548)
     (19) Allocation of Certain Funds for Socially Disadvantaged 
         Farmers and Ranchers
       The House bill amends Sec. 355(c)(2) of the ConAct to 
     authorize the Secretary to provide unused funds allocated for 
     socially disadvantaged farmers and ranchers within a state to 
     other states where there are pending loan applications for 
     (SDA) farmers and ranchers. Any remaining unused SDA funds 
     within a state may be reallocated to other applicants in that 
     state. (Sec. 520)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. (Sec. 
     544)
     (20) Horses Considered To Be Livestock Under the Consolidated 
         Farm and Rural Development Act
       The House bill amends Sec. 343 of the ConAct to include 
     horses within the meaning of livestock (Sec. 521)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (21) Temporary Suspension of Foreclosure on Certain Real 
         Property Owned by, and Recovery of Certain Payments From, 
         Borrowers With Shared Appreciation Arrangements
       The House bill directs the Secretary upon enactment of the 
     bill and through Dec. 31, 2002, to suspend foreclosure on 
     real property secured by a shared appreciation arrangement 
     and not attempt to recover payments on the terms of any 
     shared appreciation arrangement entered into between the 
     Secretary and a borrower. (Sec. 522)
       The Senate amendment amends Sec. 353(e)(7) to provide 
     alternatives to repaying the recapture amount of a shared 
     appreciation arrangement by--(1) financing the recapture 
     agreement; or (2) granting the Secretary an agricultural use 
     protection and

[[Page H1942]]

     conservation easement on the secured property which is 
     subject to the shared appreciation arrangment.
       An agricultural use protection and conservation easement 
     shall--(1) be for all of the real security property subject 
     to the shared appreciation arrangement in lieu of payment of 
     the recapture amount; (2) be for a term of 25 years; (3) 
     require that the property subject to the easement be used or 
     conserved for agricultural or conservation purposes in 
     accordance with sound farming and conservation practices; and 
     (4) provide that the borrower who is financing the recapture 
     amount may replace the financing with an agricultural use 
     protection and conservation easement.
       The amendments shall apply to a shared appreciation 
     arrangement that--(1) matures on or after the date of 
     enactment; or (2) matured before the date of enactment if--
     (a) the recapture was reamortized under sec. 353(e)(7) or 
     (b)(1) the recapture amount had not been paid before the date 
     of enactment because of circumstances beyond the control of 
     the borrower; and (b)(2) the borrower acted in good faith in 
     attempting to repay the recapture amount. (Sec. 531)
       The Conference substitute provides that the Secretary may 
     modify a recapture loan on which a payment has become 
     delinquent by using loan servicing tools if the default was 
     beyond the control of the borrower and the borrower acted in 
     good faith in attempting to repay the recapture loan. A 
     reamortized loan may not exceed 25 years from the date of the 
     original amortization agreement or provide for reducing the 
     outstanding principal or unpaid interest due on the loan.
       The Managers expect the Secretary to review USDA appeal 
     policies regarding appraisals used for shared appreciation 
     agreements. The Managers expect the Secretary to establish 
     policies that will result in the use of the most accurate 
     appraisal of assets, including the use of independent 
     appraisals provided on appeal by the borrower that are 
     consistent with Federal appraisal standards.
     (22) Authority To Make Business and Industry Guaranteed Loans 
         for Farmer-Owned Projects That Add Value to or Process 
         Agricultural Products
       The House bill amends Sec. 310B(a)(1) by expanding the 
     Secretary's loan making authority in the business and 
     industry loan program to larger than rural communities if a 
     majority of the project involved is owned by individuals who 
     reside and have farming operations in rural communities and 
     the project adds value to or processes agricultural 
     commodities. (Sec. 523)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (23) Direct Loans
       The Senate amendment amends Sec. 302(b)(1) to authorize the 
     Secretary to make direct farm ownership loans to farmers and 
     ranchers who have ``participated in the business operations 
     of'' a farm or ranch for not less than three years. (Sec. 
     501)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 501)
       The Managers are aware of the limiting impact of the 
     requirement for 3 years of operating experience on the 
     eligibility of qualified beginning farmers and ranchers for 
     farm ownership loans. The Managers intend for the Department 
     to examine potential borrowers comprehensively in terms of 
     their participation in the business operations of a farm or 
     ranch, whether or not the potential borrower was the primary 
     or senior operator. In making these determinations, the 
     Department should ensure the borrower fully meets the 
     training and experience requirement of section 302(a). The 
     Department should also place considerable weight on whether 
     the borrower has enrolled and will successfully complete the 
     borrower training program.
     (24) Financing of Bridge Loans
       The Senate amendment amends Sec. 303(a)(1) to add a new 
     purpose authorizing the refinancing of short-term temporary 
     bridge loans made by a commercial or cooperative lender to a 
     beginning farmer or rancher for the acquisition of a farm or 
     ranch if--the Secretary approved an application for a direct 
     farm ownership loan for acquisition of the land and the funds 
     for direct farm ownership loans were not available at the 
     time the application was approved. (Sec. 502)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to refinance bridge loans made by commercial or 
     cooperative lenders to borrowers who have a direct ownership 
     loan approved and for which funds are available. (Sec. 502)
     (25) Limitation on Amount of Farm Ownership Loans
       The Senate amendment amends Sec. 305(a) to limit the unpaid 
     indebtedness of any borrower to the lesser of--(1) the value 
     of the farm or other security; or (2) in the case of a direct 
     loan to a beginning farmer or rancher $250,000 (adjusted for 
     inflation) or $200,000 to other farmers or ranchers; or in 
     the case of a guaranteed loan, $700,000 (adjusted for 
     inflation and reduced by the amount of any unpaid 
     indebtedness on guaranteed operating loans of the borrower). 
     (Sec. 503)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (26) Joint Financing Arrangements
       The Senate amendment amends Sec. 307(a)(3)(D) to require 
     the Secretary to charge a rate of interest to beginning 
     farmers or ranchers that is 50 basis points less than the 
     rate charged to other farmers and ranchers on a direct loan 
     that is part of a joint financing arrangement. (Sec. 504)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (27) Guarantee Percentage for Beginning Farmers and Ranchers
       The Senate amendment amends Sec. 305(h)(6) to require the 
     Secretary to guarantee 95 percent of a farm ownership loan to 
     a beginning farmer or rancher participating in the down 
     payment loan program or an operating loan to a beginning 
     farmer or rancher who is participating in the down payment 
     loan program during the period the borrower has an 
     outstanding direct farm ownership loan. (Sec. 505)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (28) Guarantee of Loans Made Under State Beginning Farmer or 
         Rancher Programs
       The Senate amendment amends Sec. 309 by adding a new 
     subsection to authorize the Secretary to guarantee loans made 
     under a state beginning farmer or rancher program, including 
     a loan financed by the net proceeds of a qualified small 
     issue agricultural bond pursuant to the federal tax code. 
     (Sec. 506)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 504)
     (29) Down Payment Loan Program
       The Senate amendment amends Sec. 310E (b)(1) to increase 
     the principal amount of the down payment loan to be equal to 
     40 percent of the purchase price of the land acquisition. 
     (Sec. 507(1)(A))
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 505)
       The Managers are aware that on an average per dollar basis, 
     funds used for down payment loans serve over 3 times as many 
     borrowers as regular farm ownership loans, and thus help to 
     stretch limited loan funds and increase new farming and 
     ranching opportunities. The Managers encourage the Secretary 
     to widely publicize the availability of loans under this 
     section as amended among potentially eligible recipients of 
     the loans, retiring farmers and ranchers, and applicants for 
     farm ownership loans under this subtitle and to coordinate 
     the loan program established by this section with State 
     programs that provide farm ownership or operating loans for 
     beginning farmers and ranchers. The Managers strongly 
     encourage the Secretary to establish performance goals for 
     each state with a significant volume of real estate loans 
     under this subtitle, with a goal of attaining down payment 
     loan volumes consistent with the loan reservation percentage 
     for down payment loans.
     (30) Beginning Farmer and Rancher Contract Land Sales Program
       The Senate amendment adds a new Sec. 310F to the ConAct to 
     require the Secretary to carry out a pilot program by Oct. 1, 
     2002, in at least 10 geographically dispersed states. The 
     Secretary is required to guarantee at least five loans per 
     state in each of the fiscal years 2003 through 2006 made by a 
     private seller of a farm or ranch to a qualified beginning 
     farmer or rancher on a contract land sale basis, if the loan 
     meets the applicable underwriting standards and a commercial 
     lending institution agrees to serve as escrow agent. The 
     Secretary shall start the program on making a determination 
     that guarantees of contract land sales present a risk 
     comparable to the risk presented in the case of guarantees to 
     commercial lenders. (Sec. 508)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment requiring a pilot program in not fewer than 5 
     states to guarantee loans made by a private seller to a 
     beginning farmer or rancher on a contract land sale basis 
     commencing once the Secretary makes a determination and 
     authorizing the program through 2007 if it is carried out. 
     (Sec. 506)
       The Managers are aware that contract land sales are 
     prevalent in many states and encourage the Secretary to 
     create a pilot program for guaranteeing the financing of such 
     contract land sales. The Managers intend for the Secretary to 
     approve any loan guarantee under this pilot program using its 
     normal underwriting criteria. The Managers envision that land 
     contracts between the seller and buyer will contain a side 
     escrow agreement that outlines the duties and 
     responsibilities of the escrow agent.
     (31) Direct Loans
       The Senate amendment amends Sec. 311(c)(1)(A) to delete the 
     requirement that a direct loan may not be made to a farmer or 
     rancher who has operated a farm or ranch for five years or 
     more. (Sec. 511)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 511)

[[Page H1943]]

     (32) Amount of Guarantee of Loans for Tribal Farm Operations; 
         Waiver of Limitations for Tribal Operations and Other 
         Operations
       The Senate amendment adds a new paragraph (7) to Sec. 
     309(h) requiring the Secretary to guarantee 95 percent of 
     operating loans made to a farmer or rancher who is a member 
     of an Indian tribe whose farm or ranch is within an Indian 
     reservation. (Sec. 512(a))
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment requiring the Secretary to guarantee 95% of 
     operating loans made to any farmer or rancher whose operation 
     is subject to the jurisdiction of an Indian tribe. (Sec. 503)
     (33) Debt Settlement
       The Senate amendment amends Sec. 331(b)(4) by deleting the 
     provision that the Secretary may not release a borrower from 
     a debt obligation on more favorable terms than that 
     recommended by the county committee under Sec. 332. Note: 
     Sec. 332 was repealed by the 1994 USDA reorganization act. 
     (Sec. 522)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change the role of local or area Farm Service 
     Agency committees in debt settlement to consultation only 
     regarding a potential debt settlement agreement. (Sec. 533)
     (34) Interest Rate Options for Loans in Servicing
       The Senate amendment amends Sec. 331B to require the 
     Secretary, when restructuring a farmer program loan, to 
     charge the lowest of (1) the rate of the original loan; (2) 
     the rate being charged when the borrower applies for 
     restructuring the loan; or (3) the rate being charged when 
     the borrower restructures the loan. (Sec. 524)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 535)
     (35) Inventory Property
       The Senate amendment amends Sec. 335(c) dealing with the 
     sale of inventory property by--(1) providing a greater number 
     of days that the property must be held by the Secretary and 
     offered for sale to beginning farmers and ranchers; (2) 
     authorizing the Secretary to bundle or parcel real estate in 
     such ways as to maximize the sale of such real estate to 
     beginning farmers and ranchers; (3) authorizing the Secretary 
     to sell farm real estate that has been acquired and leased 
     before April 4, 1996, to beginning farmers and ranchers 
     within 60 days of the expiration of the lease arrangements; 
     and (4) authorizing the Secretary, for purposes of farmland 
     preservation and in consultation with the State 
     Conservationist, to sell or grant easements, restrictions or 
     development rights to states, political subdivisions within 
     states or private nonprofit organizations of real estate held 
     in inventory. (Sec. 527)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the period of time inventory property 
     must be offered to beginning farmers and ranchers and to 
     maximize the purchase of inventory property by combining or 
     dividing parcels of property as appropriate. (Sec. 538)
     (36) Definitions
       The Senate amendment amends Sec. 343(a)(11)(F) to replace 
     the 25 percent limitation on ownership of the median 
     ownership acreage within a county for purposes of determining 
     a beginning farmer or rancher with a 30 percent acreage 
     limitation. (Sec. 528(a))
       The House bill contains no comparable provisions.
       The Conference substitute adopts the Senate provision. 
     (Sec. 540)
     (37) Waiver of Borrower Training Certification Requirement
       The Senate amendment amends Sec. 359(f) by authorizing the 
     Secretary to waive the educational training requirements of 
     Sec. 359 if the Secretary determines that the borrower 
     demonstrates adequate knowledge in financial and farm 
     management. The Secretary shall establish standards for this 
     waiver that is implemented consistently in all counties. 
     (Sec. 532)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 545)
       The Managers are aware that waivers have not always been 
     applied consistently and are concerned that in many areas 
     waivers are exceptionally high, exceeding the 50% level. The 
     Managers intend for the Secretary to issue clear and 
     transparent criteria for waivers as quickly after enactment 
     as possible and to re-assert the importance of borrower 
     training to the success of borrowers and the effectiveness of 
     the direct lending programs.
     (38) Repeal of Burdensome Approval Requirements
       The Senate amendment amends Sec. 3.1(11)(B) to delete a 
     provision that restricts without prior approval the loan 
     participation activities of a bank for cooperatives in the 
     lending territory of a Farm Credit Bank or association. The 
     Senate amendment also amends Sec. 4.18A to make conforming 
     changes to loan participation activities of banks for 
     cooperatives and FCS institutions that operate under separate 
     titles of the Farm Credit Act. (Sec. 541)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 551)
       The Managers understand that although this provision 
     eliminates certain territorial concurrence requirements on 
     Farm Credit System lenders so that lenders may participate in 
     loan syndications or other multiple-lender arrangements for 
     ``similar entity'' loans originated in other Farm Credit 
     System geographic territories without seeking the permission 
     of the Farm Credit System lender in that territory. Current 
     law requires System institutions to obtain permission from 
     one another when participating in similar entity transactions 
     in which a commercial bank originates the loan and then sells 
     the loan to a group of lenders (including the System 
     institution). The change eliminates these requirements only 
     as they pertain to similar entity loans that the System does 
     not originate. Territorial concurrence for loans other than 
     similar entity loans are not affected by this change. The 
     Managers are expressing no opinion with this provision on 
     pending litigation regarding participation regulations issued 
     by the Farm Credit Administration on April 25, 2000.
     (39) Banks for Cooperatives
       The Senate amendment amends Sec. 3.7(b) of the Farm Credit 
     Act to replace the words ``farm supplies'' with 
     ``agricultural supplies'' and to add a definition of an 
     agricultural supply to include farm supply, agriculture-
     related processing equipment, agriculture-related machinery 
     and other capital goods related to the storage or handling of 
     agricultural commodities or products. (Sec. 542)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 552)
     (40) Insurance Corporation Premiums
       The Senate amendment amends Sec. 5.55 of the Farm Credit 
     Act to include government sponsored enterprise-guaranteed 
     loans or credits and establishes the rate at which these 
     loans or credits in accrual or non-accrual status are used to 
     fund the Insurance Fund. (Sec. 543)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision and 
     makes it applicable to calendar year 2002. (Sec. 553)
     (41) Board of Directors of the Federal Agricultural Mortgage 
         Corporation
       The Senate amendment amends Sec. 8.2(b) to increase the 
     board to 17 members. The two new members of the board shall 
     be elected by Class A (commercial banks and other financial 
     institutions) and Class B (Farm Credit System institutions) 
     stockholders, and the two new members shall be the chief 
     executive officer and another executive officer of Farmer 
     Mac. The Senate amendment also amends Sec. 8.2(b)(9) to 
     provide for the election of the chairperson from among the 
     board members instead of by appointment by the President. 
     (Sec. 544)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (42) Technical Amendments
       See Sec. 505 of the House bill
       The Senate amendment strikes references to Sec. 332 and 
     corrects the reference to the ``Robert T. Stafford Disaster 
     Relief and Emergency Assistance Act''. (Sec. 552)
       The Conference substitute adopts the Senate provisions. 
     (Sec. 561)
     (43) Effective Date
       The Senate amendment makes for the amendments made by this 
     title, except for subsection (b) of this section and section 
     543(b), take effect on Oct. 1, 2002. (Sec. 553)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.

                      Title VI--Rural Development

     (1) Funding for Rural Local Television Broadcast Signal Loan 
         Guarantees
       The House bill amends the Launching Our Communities' Access 
     to Local Television Act of 2000 to provide $200 million for 
     loan guarantees for fiscal years 2002-2006 without fiscal 
     year limitation. (Section 601)
       The Senate amendment contain no comparable provision
       The Conference substitute adopts the House provision with 
     an amendment to provide $80 million for loan guarantees from 
     the date of enactment through December 31, 2006, without 
     fiscal year limitation. (Section 6404)
       It is the view of the Managers that funding dedicated to 
     providing access to signals of local television stations 
     should be made available by the Secretary for rural broadband 
     deployment either upon expiration of the LOCAL TV Act on 
     December 31, 2006, or when the RUS Administrator certifies 
     that the goals of the program have already been met.
     (2) Expanded Eligibility for Value-Added Agricultural Product 
         Market Development Grants
       The House bill amends the Agricultural Risk Protection Act 
     of 2000 to allow $60 million ($50 million plus $10 million 
     from Sec. 943) to be used for value-added grants for each of 
     the fiscal years 2002-2011. This section is designed to 
     increase the participation in the Value-Added Agricultural 
     Products Market Development Grants by allowing

[[Page H1944]]

     broader standards of eligibility for this specific grant 
     category only so that public bodies and trade association can 
     compete along with non-profit institutions and universities 
     for grants designed to develop value-added products for 
     foreign markets. Extends the current program with increased 
     mandatory spending. (Section 602)
       The Senate amendment amends ARPA, Section 231, to spend $75 
     million each year 2002-2006. Eligible independent producers 
     and nonprofit entities may receive grants with a priority 
     given to proposals requesting less than $200,000. Defines 
     value added as undergoing a change in the physical state or 
     produced in a manner that enhances its value to consumers. No 
     less than 5% of the funding shall be used to assist producers 
     of certified organic agricultural products. The Senate 
     amendment provides 7.5% of the $75 million per year be 
     allocated to the established Agricultural Marketing Resource 
     Center authorized in ARPA. (Section 606)
       The Conference substitute adopts the Senate provision with 
     an amendment to make technical corrections, expand 
     eligibility, strike the priority designations and reserve, 
     and modify funding for the established innovation center. 
     This provision provides $40 million each fiscal year 2002 
     through 2007. Of this amount, five percent of the funds 
     will be used for the Agricultural Marketing Resource 
     Center. (Section 6401)
       The Managers intend that the Department, in administering 
     the program, will seek to fund a broad diversity of projects 
     that help increase agricultural producers' share of the food 
     and agricultural system profit, including projects likely to 
     increase the profitability and viability of small and medium-
     sized farms and ranches. The Managers intend for the 
     Department to consider a project's potential for creating 
     self-employment opportunities in farming and ranching and the 
     likelihood that the project will contribute to conserving and 
     enhancing the quality of land, water and other natural 
     resources.
       When making these grants, the Managers expect the Secretary 
     to consider applications from a variety of agricultural 
     sectors, such as renewable energy, wineries, high value 
     products from major crops, agri-marketing ventures, and 
     community supported agricultural projects. The inclusion of 
     renewable energy includes farm or ranch based wind, solar, 
     hydrogen, and other renewable energy.
       An exception from the normal rural area requirement is made 
     for majority controlled producer based business ventures. It 
     is the Managers intent that the Department award grants, to 
     the maximum extent practicable, to projects located in rural 
     areas. However, state rules and regulations and other 
     circumstances may hinder some worthy value-added agricultural 
     projects from meeting the Department's specific definition of 
     ``rural''. One such example is wineries in certain areas. In 
     this instance, the Managers expect the Department to consider 
     the importance and value of the project to area agriculture 
     producers who will be the ultimate beneficiaries of the 
     project, including the consistency of the project with the 
     intent of the program.
     (3) Agriculture Innovation Center Demonstration Program
       The House bill provides that the Secretary shall make 
     grants to establish centers to provide producers with 
     technical assistance, marketing, and development assistance 
     for value-added agricultural businesses. The Secretary shall 
     use not less than $5 million for fiscal year 2002 and not 
     less than $10 million for fiscal years 2003 and 2004. This 
     money is part of the $50 million being used for Section 602 
     activities. The Secretary shall use $300,000 of the funds 
     made available each year to support research at a university 
     on the effects of value-added projects on producers and 
     commodity markets. The Secretary shall submit a report to the 
     House and Senate Agriculture Committees on the effectiveness 
     of this demonstration program. (Section 603)
       The Senate amendment provides 7.5% of the $75 million per 
     year that is allocated to the established Agricultural 
     Marketing Resource Center authorized in ARPA. (Section 606)
       The Conference substitute adopts the House provision with 
     an amendment that the Secretary shall use not less than $3 
     million for fiscal year 2002 and not less than $6 million for 
     fiscal years 2003 and 2004. (Section 6402)
     (4) Funding of Community Water Assistance Grant Program
       The House bill directs the Secretary to use $30 million for 
     each of the fiscal years 2002-2011 to fund drinking water 
     assistance grants. Extends current program and makes it 
     mandatory spending. Strikes the word ``emergency'' in the 
     subtitle.
       Increases funding by another $45 million per year, for a 
     total of $75 million per year. (Section 604 and 943)
       The Senate amendment extends authority of the program 
     through 2006 with no changes.
       See also section 603 of the Senate amendment, which fully 
     funds existing backlog of applications for this grant program 
     and other rural development loan and grant programs. (Section 
     629)
       The Conference substitute adopts the House provision with 
     an amendment to make rural areas and small communities 
     eligible for grants in cases where a significant decline in 
     quantity and quality of water is imminent, in addition to 
     where there is an emergency. No less than 3 percent but no 
     more than 5 percent of appropriated funds shall be used for 
     these grants. (Section 6009)
       The Managers are acutely aware of the ongoing needs of 
     rural communities in maintaining water systems to provide 
     adequate and safe drinking water for its residents. The 
     Managers are particularly concerned about current drought 
     conditions in many areas of the United States and its dire 
     impact on a rural area's drinking water needs. Many areas are 
     faced not only with the lack of potable water but with the 
     lack of any water at all. For this reason, the provision 
     allowing for potable water includes the delivery of bottled 
     water where necessary.
       The Managers expect this provision to provide USDA, Rural 
     Development with a flexible program with a certainty of funds 
     to meet the emergency and imminent drinking water needs of 
     rural areas. The Secretary should ensure that communities 
     eligible for assistance under this program receive immediate 
     attention.
     (5) Loan Guarantees for the Financing of the Purchase of 
         Renewable Energy Systems
       The House bill provides that the Secretary may provide to 
     persons or individuals a loan guarantee under Section 4 of 
     the Rural Electrification Act to finance the purchase of a 
     renewable energy system, including a wind energy system and 
     anaerobic digesters for the purpose of energy generation. 
     (Section 605)
       The Senate amendment provides that the Secretary, in 
     addition to making loans and loan guarantees under other 
     laws, shall make low interest rate loans (4%), loan 
     guarantees, and grants to be used by producers for the 
     purchase of renewable energy systems and energy efficiency 
     improvements. Provides $33 million per year for such 
     purposes. (Only those producing agricultural products with a 
     market value of less than $1,000,000 in the preceding year 
     are eligible.) (Section 902)
       The Conference substitute deletes the House provision.
     (6) Loans and Loan Guarantees for Renewable Energy Systems
       The House bill amends Section 310B of the ConAct by 
     inserting ``and other renewable energy systems including wind 
     energy systems and anaerobic digesters for the purpose of 
     energy generation''. (Section 606)
       The Senate amendment provides that the Secretary, acting 
     through the Rural Business Cooperative Service shall 
     establish a program to make loans, loan guarantees (in 
     addition to loans and loan guarantees under other laws) and 
     competitively award grants to cooperatives or other rural 
     business ventures to enable producers to own and market 
     sources of renewable energy and increase the quantity of 
     electricity available from renewable energy sources. Loans 
     would be used to provide capital for start-up 
     costs associated with rural business ventures or the 
     promotion of the aggregation of renewable electric energy 
     sources. Grants would be used to develop business plans or 
     perform feasibility studies. (much like existing Value-
     Added Grants). (Section 902)
       The Conference substitute adopts the House provision. 
     (Section 6013)
     (7) Reauthorization of Programs through 2011
       The House amendment reauthorizes current programs through 
     2011. Those programs are Rural Business Opportunity Grants 
     (Sec. 607), Grants for Water Systems for Rural and Native 
     Villages in Alaska (Sec. 608), Rural Cooperative Development 
     Grants (Sec. 609), National Reserve Account for Rural 
     Development Trust Fund (Sec. 610), and the Rural Venture 
     Capital Demonstration Program (Sec. 611). (Sections 607, 608, 
     609, 610, and 611)
       The Senate amendment reauthorizes Rural Business 
     Opportunity Grants (same as House Sec. 607) except that 
     authorization is increased from $7.5 million to $15 million a 
     year, and authority runs through 2006.
       Reauthorizes Grants for Water Systems for Rural and Native 
     Villages in Alaska (same as House Sec. 608) except that 
     authority runs through 2006.
       Reauthorizes Rural Cooperative Development Grants (same as 
     House Sec. 609) except that it prohibits the Secretary from 
     requiring a non-federal share of more than 5% for 1994 
     institutions, and authority runs through 2006.
       The Senate amendment contains no comparable provisions on 
     the National Reserve Account for Rural Development Trust Fund 
     or the Rural Venture Capital Demonstration Program. (Section 
     622, 631, and 633)
       The Conference substitute adopts the Senate provision on 
     Rural Business Opportunity Grants. (Section 6003)
       The Conference substitute adopts the House provision on 
     Grants for Water Systems for Rural and Native Villages in 
     Alaska. (Section 6011)
       The Conference substitute adopts the Senate provision on 
     Rural Cooperative Development Grants. (Section 6015)
       The Conference substitute adopts the House provisions with 
     an amendment to repeal the National Reserve Account for Rural 
     Development Trust Fund and the Rural Venture Capital 
     Demonstration Program. (Section 6026)
     (8) Increase in Limit on Certain Loans for Rural Development
       The House bill increases the loan limit of the Business and 
     Industry lending program authorized by Sec. 310B of the 
     ConAct from $25 million to $100 million. (Section 612)
       The Senate amendment contains no comparable provision.

[[Page H1945]]

       The Conference substitute adopts the House provision with 
     an amendment that the Secretary may guarantee a loan that may 
     not exceed $40 million for a project that is located in a 
     rural area and provides for the value-added processing of 
     agricultural commodities. The Secretary may not delegate the 
     approval authority. (Section 6017)
     (9) Pilot Program for Rural Development Strategic Plans and 
         Implementation
       The House bill provides that the Secretary shall select 
     states to implement rural development strategic plans. This 
     is a new program that provides mandatory spending of $2 
     million in grants for each fiscal year 2002-2011 (plus 
     another 2/13 or approximately $6.9 million from Sec. 943.).
       Provides mandatory spending of $13 million for grants to 
     implement the plans for each fiscal year 2002-2011 (plus 11/
     13 or approximately $38 million from Sec. 943.).
       The Strategic Planning Initiative and Implementation 
     provision authorizes a matching grant pilot program of $2 
     million (plus $6.9 million) per year to entities for 
     regional, collaborative rural development strategic plans in 
     those states that are chosen by the Secretary. Community-
     based and grassroots organizations' support and participation 
     are critically important to successful planning. The matching 
     grant requirement will help ensure that there is a commitment 
     at the local level for the planning process. The provision 
     allows the Secretary to require up to a 50% matching grant. 
     This requirement is not intended to serve as a barrier to 
     limited resource communities in fully participating in the 
     program. The Secretary should require matching grants 
     commensurate with a community's ability to pay, even to the 
     point of only requiring a nominal amount in order to ensure 
     the broadest participation.
       In developing a regional development plan it is imperative 
     that local specialists representing many varied areas of 
     expertise be included. The Secretary should give priority to 
     grant applicants whose proposals include the broadest 
     coalitions of regional and local organizations--both public 
     and private. Entities eligible for matching grants include 
     but are not limited to Councils of Government, Area 
     Development Districts, Economic Development Districts, Local 
     Development Districts, Planning and Development Districts, 
     Regional Planning Commissions and Regional Councils of 
     Government. (Section 613)
       The Senate amendment spends $5 million in 2002 for planning 
     grants to conditionally approved program entities under Sec. 
     385C(d). Spends $2 million in 2002 for private technical 
     assistance under Sec. 358C(h).
       Amends the ConAct to create a Program that will provide 
     rural communities with technical and financial assistance to 
     develop and implement community development strategies. The 
     Secretary shall approve a program entity to receive grants if 
     the entity meets certain criteria, and once approved, the 
     entity shall establish an endowment fund. The Secretary may 
     award supplemental grants, not to exceed $100,000, to 
     approved entities to assist in developing a strategy (Sec. 
     385C(d) see above). To be eligible for an endowment grant, 
     approved entities shall develop and obtain the approval of 
     the Secretary for a comprehensive strategy. An approved 
     entity shall receive final approval if the strategy meets 
     certain requirements, and the Secretary may make grants, not 
     to exceed $6 million, to these entities to implement the 
     strategy (Sec. 385C(f) see above). Approved entities must 
     provide a 50% match of the amount received in grant funds, 
     except in certain cases where it is determined that a lower 
     non-federal share is allowable to invest and then use the 
     funds for infrastructure improvements and/or investments in 
     enterprises that will improve the area. Grants may be made, 
     not to exceed $100,000, to qualified intermediaries to 
     provide technical assistance and capacity building to 
     approved entities (Sec. 358C(h) see above). Authorizes such 
     sums as are necessary for fiscal years 2004-2006. (Section 
     604)
       The Conference substitute adopts the House provision with 
     an amendment to establish a National Board on Rural America 
     that will make planning grants and innovation grants to 
     certified Regional Investment Boards. A National Conference 
     on Rural America will be held to address challenges in rural 
     areas. A total of $100 million is available to carry out 
     this section. (Section 6030)
       For over 40 years rural policy scholars and analysts have 
     recognized the absolute necessity of a more integrated, 
     comprehensive rural policy framework. In establishing this 
     framework, Section 6030, will require the active 
     participation of all Federal agencies, rural units of local 
     government, development organizations, community-based 
     organizations, rural nongovernmental organization, and the 
     private and philanthropic sectors. While a collaborative 
     effort and comprehensive planning is essential for success of 
     any endeavor, no plan can succeed without resources for its 
     implementation and completion.
       This program is designed to use Federal funds as a catalyst 
     to bring together the various sectors from rural areas in 
     order to make maximum use of Federal, state and local 
     resources.
       The Managers intend that the appropriate population of an 
     eligible area is between 50,000 and 150,000; however, the 
     Managers expect the regional and national boards to make 
     exceptions as needed. The target population does not include 
     a metropolitan area which may be participating in a regional 
     plan.
       The Managers understand the diversity of governance, 
     governmental entities and governmental structure in the 50 
     states. In composing the regional boards, the Managers expect 
     that it will include the broadest possible collection of 
     public and private entities representative of the area or 
     region of the eligible area.
       In appointing the National Board on Rural America, the 
     Managers expect the Secretary to carefully consider 
     individuals recommended by the Chairman and Ranking Members 
     of the House Committee on Agriculture and the Senate 
     Committee on Agriculture, Nutrition and Forestry, the Speaker 
     of the House of Representatives, and the Majority Leader of 
     the Senate. The Secretary is encouraged to consider seven 
     recommendations from the House of Representatives and seven 
     recommendations from the Senate.
     (10) Grants to Nonprofit Organizations to Finance the 
         Construction, Refurbishing, and Servicing of 
         Individually-Owned Household Water Well Systems in Rural 
         Areas for Individuals with Low or Moderate Incomes
       The House bill amends the water and wastewater authorities 
     under the ConAct to authorize the Secretary to make grants 
     and loans to provide individual residential water wells. 
     (Section 614)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment limiting loans to $8,000 per water well system 
     and authorizing the program at $10 million per fiscal year. 
     (Section 6012)
     (11) National Rural Development Partnership
       The House bill adds a new section to Subtitle E of the 
     ConAct to establish a National Rural Development Partnership 
     composed of the Coordinating Committee and the state rural 
     development councils. (Section 615)
       The Senate amendment amends Subtitle D of the ConAct to add 
     the NRDP composed of the Coordinating Committee and the state 
     rural development councils. (Section 611)
       The Conference substitute adopts the Senate provision with 
     an amendment clarifying the Senate language and authorizing 
     up to $10 million per fiscal year. (Section 6021)
       The Conference substitute includes provisions which are 
     intended to ensure the accountability of State Rural 
     Development Councils (SRDCs) to the rural residents they are 
     expected to serve and to agencies which provide financial 
     support for their operations. The Managers specifically 
     intend that all SRDCs will continue to abide by or come into 
     compliance with the structural and process guiding principles 
     of this section. The Managers also intend that USDA/Rural 
     Development State Directors and other employees of USDA and 
     other Federal agencies with rural responsibilities will fully 
     participate as voting members in the governance and 
     operations of SRDCs on an equal basis with other SRDC 
     members.
       The Managers expect the National Rural Development 
     Coordinating Committee to make significant progress toward 
     the goal of better coordinating the rural policies and 
     programs of Federal agencies and developing greater 
     collaboration between the Federal government, the States, and 
     others with resources to invest in rural areas.
       The Partnership has depended on voluntary contributions of 
     discretionary funds from multiple Federal agencies to support 
     its activities. This system has not met all of the needs of 
     the SRDC. Accordingly, the Conference substitute contains an 
     authorization for annual appropriations of $10 million. The 
     Managers encourage Federal agencies, whether or not they have 
     contributed to the Partnership in the past, to financially 
     support collaborative initiatives managed by SRDCs. The 
     Managers specifically intend that all Federal funds that are 
     provided to the SRDCs will be used solely for SRDC operations 
     and projects and that the use of these funds will be 
     controlled exclusively by the SRDCs' governing boards. The 
     Managers also strongly urge SRDCs to identify additional 
     sources of non-Federal funds to support their activities.
       SRDCs currently operate in 40 States. The Managers 
     encourage the Secretary to work with the remaining 10 States 
     to establish SRDCs.
     (12) Eligibility of Rural Empowerment Zones, Rural Enterprise 
         Communities, and Champion Communities for Direct and 
         Guaranteed Loans for Essential Community Facilities
       The House bill amends Sec. 306(a) of the ConAct to 
     authorize the Secretary to make or insure loans to 
     communities designated as rural empowerment zones, rural 
     enterprise communities or as champion communities to install 
     or improve essential community facilities. (Section 616)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment to strike ``champion communities''. (Section 
     6001)
       The Managers intend that this provision affect only two 
     communities--Lewiston, Maine, and Eagle Pass, Texas. These 
     communities were designated rural Enterprise Communities in 
     1999, and this amendment would make them eligible for 
     participation in essential community facility programs only.
     (13) Grants to Train Farm Workers in New Technologies and to 
         Train Farm Workers in Specialized Skills Necessary for 
         Higher Value Crops
       The House bill provides that the Secretary may make grants 
     to an entity to train farm

[[Page H1946]]

     workers to use new technologies and develop specialized 
     skills for agricultural development. Authorizes no more than 
     $10 million be appropriated to the Secretary for fiscal years 
     2002-2011 to make such grants. (Section 617)
       The Senate amendment is the same except it authorizes 
     grants through 2006. (Section 646)
       The Conference substitute adopts the House provision with 
     an amendment making technical changes and adding ``farmer 
     cooperatives'' as an eligible entity. (Section 6025)
     (14) Loan Guarantees for the Purchase of Stock in a Farmer 
         Cooperative Seeking to Modernize or Expand
       The House bill amends Sec. 310B of the ConAct to provide 
     loan guarantees for individual farmers to purchase capital 
     stock of a farmer cooperative established for an agricultural 
     purpose. (Section 618)
       See also Sec. 523 (Credit Title) of the House bill, which 
     contains additional modifications to the B&I Loan Program to 
     provide for guaranteed loans to projects in areas other than 
     rural communities, in the case of insured loans, if a 
     majority of the project involved is owned by individuals who 
     reside and have farming operations in rural communities, and 
     the project adds value to or processes agricultural 
     commodities.
       The Senate amendment amends Sec. 310B of the ConAct to 
     provide loan guarantees to farmers, ranchers or cooperatives 
     to purchase start-up capital stock for expanding or creating 
     an agriculture coop. The Secretary may guarantee a loan to a 
     producer to join a coop in order to sell products he 
     produces. Farmer coops eligible for B&I loans shall be 
     eligible to refinance existing loans. The Secretary may 
     establish appraisal standards for the Business and Industry 
     Loan Program. The Secretary may assess a one-time fee for a 
     loan guarantee, not to exceed 2% of the guaranteed principal 
     portion of the loan. (Section 635)
       The Conference substitute adopts the Senate provision with 
     an amendment to provide loan guarantees to purchase capital 
     stock. The Secretary may make or guarantee a loan to a 
     cooperative organization headquartered in a metropolitan area 
     if the loan is used for a project in a rural area or meets 
     the criteria of a cooperative generally. A cooperative 
     organization shall be eligible to refinance an existing loan 
     if certain requirements are met. The Secretary may guarantee 
     a loan to a cooperative for a facility that is not located in 
     a rural area if the facility provides value-added processing 
     to producers located within 80 miles of the facility; if the 
     primary benefit of the guarantee provides employment to rural 
     areas; and the total amount of loans guaranteed does not 
     exceed 10 percent of total loan guarantees in a fiscal year. 
     The Secretary may consider the value of a properly appraised 
     brand name, patent, or trademark of the cooperative in 
     determining whether the cooperative organization is eligible 
     for a loan guarantee. The Secretary may guarantee a loan that 
     may not exceed $40 million for a project that is located in a 
     rural area and provides for the value-added processing of 
     agricultural commodities and the Secretary may not delegate 
     the approval authority for such a guarantee. (Section 6017)
       There is a 2% limit on an initial fee. That limit does not 
     prevent annual fees which may be needed to preserve an 
     appropriate program level.
       The Managers expect the Secretary, to consider on a 
     priority basis, Business and Industry loan and loan guarantee 
     program applications from eligible marketing cooperatives of 
     agriculture producers for the purpose of constructing peanut 
     storage facilities and for value-added agriculture and 
     renewable energy. In regard to paragraphs (6) and (8), the 10 
     percent limit in each of those paragraphs is not a goal to be 
     worked toward, but a limit. The Managers recognize that the 
     loans or loan guarantees provided may be less than that 
     level.
     (15) Intangible Assets and Subordinated Unsecured Debt 
         Required to be Considered in Determining Eligibility of 
         Farmer-Owned Cooperative for Business and Industry 
         Guaranteed Loan
       The House bill amends Sec. 310B of the ConAct for this 
     purpose. In considering applications for a loan guarantee 
     from an agricultural cooperative, the Rural Business-
     Cooperative Service may consider the value of intangible 
     assets such as trademarks, patents, licenses, and brands 
     subject to appraisal, when evaluating the eligibility of an 
     agricultural cooperative for loan guarantees. The same 
     consideration may be given to unsecured subordinated debt, 
     which may be viewed as the equivalent of equity in the 
     cooperative. Both intangible assets and unsecured 
     subordinated debt may be considered in determining the 
     viability of a cooperative's balance sheet. (Section 619)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment that the Secretary may consider the value of a 
     properly appraised brand name, patent, or trademark of a 
     cooperative. (Section 6017)
     (16) Ban on Limiting Eligibility of Farmer Cooperative for 
         Business and Industry Loan Guarantee Based on Population 
         of Area in which Cooperative is Located
       The House bill amends the ConAct so that in determining 
     whether a cooperative organization owned by farmers is 
     eligible for a guaranteed loan, the Secretary shall not apply 
     any lending restrictions based on population to the area in 
     which the cooperative is located. (Section 620)
       The Senate amendment provides for that loans can be made to 
     coops headquartered in a metropolitan area if the project is 
     in a rural area. (Section 635)
       The Conference substitute adopts the House provision with 
     an amendment that the Secretary may guarantee a loan to a 
     cooperative for a facility that is not located in a rural 
     area if the facility provides value-added processing to 
     producers located within 80 miles of the facility; if the 
     primary benefit of the guarantee provides employment to rural 
     areas; and the total amount of loans guaranteed does not 
     exceed 10 percent of total loan guarantees in a fiscal year. 
     (Section 6017)
     (17) Rural Water and Waste Facility Grants
       The House bill removes the appropriation authorization from 
     the rural water and waste water program under the ConAct, in 
     effect providing such sums as may be necessary. (Section 621)
       The Senate amendment increases current law from $590 
     million in total spending per year to a new authorization of 
     $1.5 billion per year. The Secretary may make grants to 
     entities to capitalize revolving funds to provide loans to 
     eligible borrowers to finance up to $100,000 of the costs of 
     predevelopment, equipment, replacement, small 
     systems extensions and other small water and wastewater 
     projects. Authorizes appropriations of $30 million each 
     fiscal year 2002-2006 for this subparagraph. (Section 621)
       The Conference substitute adopts the Senate provision with 
     an amendment to authorize such sums as necessary for the 
     rural water and waste water program. (Section 6002)
     (18) Rural Water Circuit Rider Program
       The House bill establishes permanently under the ConAct a 
     national rural water circuit rider program to provide 
     technical expertise to existing and start-up rural water 
     systems throughout the country. Provides an authorization of 
     appropriations of $15 million per year (Section 622)
       The Senate amendment is nearly identical to House bill 
     except for (B) that contains language that says the new 
     program ``shall not affect the authority of the Secretary to 
     carry out the circuit rider program for which funds are made 
     available under the heading RCAP for 2002.'' Also, the 
     authorization for $15 million is only through 2006. (Section 
     623)
       The Conference substitute adopts the Senate provision with 
     an amendment making the program permanent. (Section 6005)
     (19) Rural Water Grassroots Source Water Protection Program
       The House bill establishes a national source water 
     protection program within the U.S. Department of Agriculture 
     that will enable rural water associations to provide better 
     services in the implementation of wellhead and ground water 
     protection programs. The program is authorized at an annual 
     appropriation of $5 million. (Section 623)
       The Senate amendment contains no comparable provision in 
     rural development title, but see conservation title.
       The Conference substitute adopts the Senate provision. 
     (Section 217 (1240Q))
     (20) National Rural Cooperative and Business Equity Fund
       The Senate amendment amends the ConAct to establish the 
     Fund, governed by a board of directors, to revitalize rural 
     communities and sustain rural business development by 
     providing federal funds and credit enhancements to a private 
     equity fund in order to encourage investments by authorized 
     private investors. The Secretary shall make $150 million 
     available (subject to appropriations) for the fund which is 
     to be matched by the investors; guarantee 50% of each 
     investment up to $300 million made by a Fund investor; 
     guarantee 100% of the repayment of principal and accrued 
     interest on approved debentures issued by the Fund, not to 
     exceed $500 million. No single investment shall exceed the 
     greater of $2 million or 7% of the Fund. The total investment 
     made in a company may not exceed 20% of the total investment 
     in the project. Authorizes such sums as are necessary. 
     (Senate 601)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (21) Rural Business Investment Program
       The Senate amendment spends $70 million in 2002 for 
     subsidies and $50 million in 2002 for grants.
       Adds a new subtitle H to the ConAct that establishes a 
     Rural Business Investment Program (RBIP) administered by the 
     Secretary that, among other things, promotes economic 
     development and the creation of wealth and job opportunities 
     in rural areas.
       New Sec. 384A. defines various terms used by the Secretary 
     to implement the RBIP, including the term Rural Business 
     Investment Company (RBIC).
       New Sec. 384B. sets out the purposes of the RBIP to promote 
     economic development and to establish a developmental venture 
     capital program that addresses the unmet investment needs of 
     small enterprises. The Secretary is authorized to enter into 
     participation agreements with RBICs, guarantee RBIC 
     debentures and make grants to RBICs.
       New Sec. 384C. establishes the RBIP.
       New Sec. 384D provides for the eligibility of companies to 
     apply to participate in the

[[Page H1947]]

     RBIP if 1) the company is newly formed for-profit or a 
     subsidiary of such company; 2) the company has a management 
     team experienced in financing community development; and 3) 
     the company will invest in enterprises that will create 
     wealth and job opportunities.
       Applications to participate must contain a business plan, 
     information about management's experience in financing rural 
     development, a description of how the company intends to work 
     with community organizations to meet unmet capital needs, a 
     proposal on how the company will use grant funds, an estimate 
     of cash to in-kind contributions the company will have in 
     binding commitments, a description of the evaluation 
     standards the company will use to determine whether or not it 
     is meeting the RBIP's purposes, information regarding the 
     financial strength of the parent company or its subsidiary, 
     and any other information the Secretary requires.
       The Secretary must issue within 90 days a status report 
     about an application to participate and must approve or 
     disapprove the application within a reasonable time and, on 
     approval, issue a license for the operation of the applicant. 
     If disapproved, the Secretary must notify the applicant in 
     writing.
       The Secretary is required to make determinations about the 
     applicant when reviewing and processing the application, 
     including finding that the management personnel of the 
     applicant are qualified to carry out the RBIP and generally 
     have a good business reputation.
       The Secretary shall approve and designate the applicant as 
     a RBIC if it is determined that the applicant qualifies, the 
     area in which the RBIC will operate is acceptable and the 
     applicant enters into a participation agreement. The 
     applicant has a capital requirement of at least $2.5 million.
       New Sec. 384E provides that the Secretary is authorized to 
     guarantee, using the full faith and credit of the United 
     States, the timely payment of principal and interest on 
     debentures issued by the RBIC. Debenture guarantees may not 
     exceed 15 years. Such guarantees may not exceed the lesser of 
     300 percent of the private capital of the RBIC or $105 
     million, and may provide for use of discounted debentures.
       New Sec. 384F authorizes the Secretary to issue trust 
     certificates that represent partial or full ownership of RBIC 
     debentures. The Secretary may pool RBIC debentures on which 
     the certificates are based and may guarantee the timely 
     payment of principal and interest on the certificates. The 
     Secretary may administer the guaranteed trust or pool to 
     provide for prepayment of or defaults on debentures. Trust 
     certificates are backed by the full faith and credit of the 
     U.S.
       The Secretary is required to provide for a central 
     registration of all trust certificates and will subrogate and 
     retain ownership rights over a debenture on which a claim is 
     satisfied. The Secretary may maintain bank accounts and 
     investments to facilitate the creation of trusts or pools of 
     debentures. The Secretary may regulate brokers and dealers in 
     RBIP trust certificates and require any person functioning as 
     the Secretary's agent to provide a bond or evidence of 
     insurance.
       New Sec. 384G authorizes the Secretary to charge fees for 
     the guarantee of debentures or grants, and the Secretary's 
     agents may collect a fee for operating a trust pool. The 
     Secretary may charge a fee to license a RBIC. The Secretary 
     shall use the fees to cover salaries and expenses of the 
     Secretary and are authorized for covering the costs of 
     licensing exams.
       New Sec. 384H authorizes the Secretary to make grants to 
     RBICs over a multi-year period to be used only to provide 
     operational assistance. RBICs must show how they will use 
     grant funds. The amount of the grant can be up to the lesser 
     of 10% of the private capital raise or $1 million. NOTE: 
     INTENT was to also limit such funds to the lesser of twice 
     the match provided by the RBIC. The Secretary may make grants 
     to entities other than a RBIC under the same terms as it 
     would to an RBIC.
       New Sec. 384I sets out the legal organization of RBICs, 
     including their articles of incorporation if incorporated, 
     and minimum levels of private capital acceptable to operate 
     as a RBIC. The Secretary may accommodate lesser capital 
     standards upon the showing of special circumstances and good 
     cause. The Secretary shall ensure that the private capital is 
     adequate for success and that at least 75 percent of the 
     capital is invested in rural business and not more than 10% 
     may be invested in a city of over 100,000 or its surrounding 
     urbanized area. That the minimum amount of capital required 
     for RBICs authorized to be issued guarantees on debentures 
     shall be $10,000,000 or $5,000,000 with a determination by 
     the Secretary regarding risk. Secretary also is required to 
     ensure that the RBIC management is diversified and 
     unaffiliated with the ownership of the RBIC.
       New Sec. 384J provides that national banks, Federal Reserve 
     member banks, federal savings associations, Farm Credit 
     System (FCS) institutions and other insured banks may invest 
     in RBICs but in no event may a lending institution make a 
     greater than five percent investment of its capital and 
     surplus in RBICs. In the case of a FCS institution or a 
     combination of FCS institutions holding more than 15 percent 
     of the voting stock in a RBIC, the RBIC may not provide 
     financial or equity investment assistance to any entity not 
     otherwise eligible to receive financing from the FCS.
       The total invested by any of the described financial 
     institutions shall not exceed 5% of their capital.
       New Sec. 384K sets out the reporting requirements.
       New Sec. 384L provides for the Secretary to direct a 
     private sector entity to exam the books, records and 
     operations of participating RBICs, and the Secretary may 
     charge RBICs for the costs of such examinations.
       New Sec. 384M authorizes the Secretary to use the federal 
     district courts to enforce compliance of all provisions of 
     the RBIP set out in rules, regulations, orders or 
     participation agreements should the Secretary have reason to 
     believe a RBIC is engaging in or about to engage in any act 
     or practice that violates the RBIP. In the event of 
     violations, a court of competent jurisdiction may issue 
     temporary or permanent injunctions, restraining orders or 
     other orders to prohibit further activities and may appoint a 
     trustee or receiver to manage the assets of a RBIC. The 
     Secretary may act as a trustee or receiver.
       New Sec. 384N authorizes the Secretary to void RBICs' 
     participation agreements and to stop the exercise of all 
     rights and privileges as a RBIC. A RBIC must be found to be 
     in violation of the RBIP before the loss of such privileges.
       New Sec. 384O provides that RBICs and other, associated 
     persons involved in any activity that violates the act to be 
     held together to the extent the associated persons authorize 
     or otherwise bring about the violation. Any mismanagement or 
     misconduct shall be a breach of fiduciary responsibility and 
     unlawful. Any person associated with the RBIC that commits 
     any unlawful act or practice, or fails in any act or 
     practice, that would result in the RBIC suffering financial 
     losses has breached his fiduciary responsibility. This 
     section further provides suitability rules for officers or 
     agents of the RBIC and makes any breach of those rules to be 
     unlawful acts.
       Sec. 384P provides procedures for removing officers or 
     agents of a RBIC.
       Sec. 384Q requires the Secretary to enter into an 
     interagency agreement with the Small Business Administration 
     to carry out the day-to-day management and operation of the 
     RBIP.
       Sec. 384R authorizes the Secretary to write regulations to 
     carry out the RBIP.
       Sec. 384S provides $350 million for the guarantee of 
     debentures and $50 million for grants from Treasury funds not 
     otherwise appropriated to carry out the RBIP. Such funds 
     shall remain available until spent.
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment making clarifying changes and that the Secretary 
     shall enter into an interagency agreement with another 
     federal agency that has expertise in operating a program of 
     this nature. The Conference substitute provides $100 million 
     to carry out this program. (Section 6029)
       This program addresses the crucial problem of limited 
     equity capital in rural America. The program allows 
     investment companies to considerably leverage their equity 
     resources, increasing the equity funds available in rural 
     America by attracting capital for the program and through the 
     leverage that the program provides. Only for profit Rural 
     Business Investment Companies (RBIC) may apply because the 
     profit motive and danger of loss will help minimize losses to 
     the government. The Managers believe that a high quality 
     management team of the applicants is crucial for success and 
     expects that this factor will be given solid consideration.
       Financial institutions may participate in the program as 
     set forth in the program. The Managers intend that financial 
     institution regulators including the Farm Credit 
     Administration, the Office of the Comptroller, the Federal 
     Reserve, state bank regulators, and other financial 
     institution regulators continue to have the authority to 
     impose on any financial institution that they regulate any 
     safeguard, limitation, or condition that the regulator 
     considers to be appropriate (including, without limitation, 
     any investment limit that is lower than the investment limit 
     that this section imposes on insured depository 
     institutions). The strong expectation of the Managers is that 
     RBICs will not normally engage in lending of a type performed 
     by regulated financial institutions except in circumstances 
     where such assistance is not likely to be available and where 
     the equity investment makes such arrangements prudent given 
     the overall risks involved.
       The program is modeled after the Small Business Investment 
     Company program, where considerable expertise in operating 
     the program that provides capital for equity investments 
     has been developed. That program shares many of the same 
     provisions with the RBIC program that is being enacted 
     allowing day-to-day management to follow almost identical 
     practices with a few exceptions such as those dealing with 
     the grants program and rural targeting of investments. It 
     is the expectation of the Managers that the Secretary 
     enter into an agreement under the Economy Act within 60 
     days of enactment with that appropriate agency.
       It is the expectation of the Managers that a considerable 
     share of the rules and operating procedures for this program 
     will be the same as the rules and operating procedures for 
     the Small Business Investment Company program. Given that 
     reality, it is the Manager's expectation that rules 
     implementing this program can be proposed in a very short

[[Page H1948]]

     time period. The grant provisions are similar to the New 
     Markets Venture Capital Program.
     (22) Full Funding of Pending Rural Development Loan and Grant 
         Applications
       The Senate amendment spends a CBO estimated $454 million in 
     2002 (no future spending) to close out the backlog in the 
     following rural development programs: community facility 
     direct loans and grants; water and waste disposal direct 
     loans and grants; rural water or wastewater technical 
     assistance and training grants; emergency community water 
     assistance grants; B&I guaranteed loans; solid waste 
     management grants. Applications in the preapplication phase 
     are not eligible for funding under this provision. (Section 
     603)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to provide $360 million to fund pending 
     applications for water and waste disposal system grants and 
     loans, with priority to water systems. (Section 6031)
     (23) Enhancement of Access to Broadband in Rural Areas
       The Senate amendment spends $100 million each year 2002-
     2006. Amends the Rural Electrification Act. The Secretary 
     shall make grants, loans, and loan guarantees at 4% or market 
     rate interest to construct, improve, acquire facilities and 
     equipment to provide broadband service to rural communities 
     with no more than 20,000 residents. Funding will be allocated 
     to states, and funds not obligated by April 1 will go in a 
     national pool to be used by the Secretary to make grants, 
     loans, and loan guarantees in any state. (Section 605)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to provide loans and loan guarantees for 
     broadband service and to clarify what entities are eligible 
     to receive a loan or loan guarantee. (Section 6103)
       The Managers expect that the state government or local 
     government or any agency, subdivision or instrumentality 
     thereof (including consortia thereof) will be permitted to 
     file applications during the three-month waiting period after 
     the RUS has promulgated rules on the broadband program in 
     order to keep their place in line for the next available 
     round of funding.
       The Managers expect the RUS to evaluate the priority status 
     of all pending broadband applications as soon as practicable 
     after the date of enactment. Any completed application which 
     meets the priority criteria should be evaluated for expedited 
     approval. The Managers expect the Agency to determine the 
     priority status of applications on hand at least once every 
     quarter. In general, all other applications should be 
     evaluated and awarded on a first come first serve basis.
       The Managers are aware that in the current broadband pilot 
     program RUS has generally used the FCC's definition of 
     broadband services. It is the Manager's intent that this 
     practice should continue and that is why the Manager's used 
     the definition of broadband services that is currently being 
     used by the FCC and the RUS. The Managers want to make clear 
     that the purpose behind using this definition was to maintain 
     the current high standard used by RUS in determining what a 
     broadband service is.
       However, the Managers expect the Administrator will apply a 
     definition of broadband services to encourage new broader 
     bandwidth technologies in rural areas and that the program 
     will foster the development of a variety of technological 
     applications including terrestrial and satellite wireless 
     services. This is a critical function since this is a rapidly 
     changing technology.
       The Managers have taken no position on particular 
     technologies and believe that it is very important for the 
     Department not to choose among adequate technologies. The 
     Managers expect the Secretary to participate in any FCC 
     proceedings or Department of Commerce study of the future of 
     broadband services and the markets for such services.
       The Managers are aware that the RUS has administered a 
     telecommunications program for over 50 years. To date there 
     has not been a loan loss in that program. The Managers 
     expect, that given that record, program levels will fully 
     take that reality into account. The Managers intend for 
     direct loans to be made at the treasury rate of interest in 
     most circumstances.
     (24) National Rural Development Information Clearinghouse
       The House bill extends the National Rural Information 
     Center Clearing-House--(7 U.S.C. 3125b(c)) through 2011. 
     (Section 701)
       The Senate amendment amends Section 2381 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 to establish 
     a Clearinghouse at USDA to collect and disseminate 
     information about programs and services available to a person 
     or entity in a rural area regarding financial, technical or 
     other assistance. The Clearinghouse will maintain an Internet 
     website, and the Secretary shall use not more than $600,000 
     of the funds available to RHS, RUS, RBS each fiscal year to 
     operate and maintain the Clearinghouse. (Section 607)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7101)
       The Managers expect the Rural Development mission area of 
     the Department to highlight the existence and resources of 
     the Rural Information Center of the National Agricultural 
     Library on its websites and in its informational materials.
     (25) Multijurisdictional Regional Planning Organizations
       The Senate amendment amends the ConAct to allow the 
     Secretary to provide grants up to $100,000 to 
     multijurisdictional regional planning organizations to pay 
     for costs of assisting local governments to improve 
     infrastructure, services and business development 
     capabilities. Authorizes appropriations for $30 million in 
     each year 2003-2006. A local match is required. (Section 624)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 6006)
     (26) Certified Nonprofit Organizations Sharing Expertise
       The Senate amendment amends Sec. 306(a) of the ConAct. The 
     Secretary shall certify nonprofit organizations (which may 
     include an institutions of higher education) that demonstrate 
     experience in providing technical assistance to improve 
     infrastructure, services and business development 
     capabilities of local governments, and make this list 
     available to the public. Authorizes appropriations of $20 
     million each fiscal year 2003-2006 to make grants to 
     certified organizations. (Section 625)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (27) Loan Guarantees for Certain Rural Development Loans
       The Senate amendment amends Sec. 306(a) to authorize the 
     Secretary to guarantee loans made for community facilities or 
     water and sewer systems, including loans financed by bond 
     issuances described by Section 144(a)(12)(B)(ii) of the IR 
     code. (NOTE: currently, projects with bonds receiving 
     assistance under that section may not receive other 
     government support. This section does not impact the IRS 
     provision). Any individual or entity offering to buy these 
     loans may receive the guarantee if the individual or entity 
     demonstrates that person can continue the performance of the 
     loan and can generate capital to assist borrowers of loans 
     with additional credit needs to ensure servicing of loans.
       Amends Sec. 310B. to authorize the Secretary to guarantee 
     loans made to finance bond issues for the provision of 
     community facilities or water and sewer systems. (Section 
     626)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change the reference to section 142(a) of the 
     Internal Revenue Code of 1986. (Section 6007)
       The Managers intent is that this section will allow the 
     Department to provide support for noted projects in the event 
     the IRS code is modified to allow such support without 
     adversely affecting tax benefits.
     (28) Rural Firefighters and Emergency Personnel Grant Program
       The Senate amendment spends $10 million in 2002 and then 
     $30 million each year 2003-2006. Amends the ConAct to 
     establish a grant program to provide scholarships to local 
     government units to train firefighters and emergency medical 
     personnel in firefighting, emergency medical practices, and 
     responding to hazardous material and bioagents. Not less than 
     60% of the funds shall be used for this purpose. Grants may 
     be used for facility improvements, equipment, operating, or 
     establishing regional training centers. Not more than 40% may 
     be used for the facility grants. The federal share of the 
     facility grants shall not exceed 50%. (Section 627)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     a technical amendment to clarify that the Secretary shall 
     give priority to grant applicants that provide for training 
     within the region or locality in which the grant applicant is 
     located. The Conference substitute provides for a funding 
     level of $10 million for each of fiscal years 2003 through 
     2007, and as a result of this lower level of overall funding 
     for the program, reduces the $2 million limitation for any 
     single training center in any single year to $750,000. 
     (Section 6405)
       The Managers expect that efforts will be made to minimize 
     travel costs in order to maximize actual training provided. 
     In order to minimize costs, appropriate training facilities 
     within the area or region should be utilized whenever 
     possible. Many firefighter and first responder training 
     facilities, some with specialized functions such as farm 
     safety have received USDA or FEMA assistance in the past, 
     have excellent reputations but have significant facility 
     needs. It is expected that the Department give a high 
     priority to such facility needs.
     (29) Tribal College and University Essential Community 
         Facilities
       The Senate amendment amends Section 306(a) of the ConAct to 
     add a provision allowing the Secretary to make grants to 
     tribal colleges and universities to help them develop 
     essential community facilities in rural areas. The federal 
     share is not to exceed 75% of the total cost of these 
     facilities. Authorizes $10 million a year for each of fiscal 
     years 2003 through 2006. (Section 628)

[[Page H1949]]

       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 6008)
     (30) Water and Waste Facility Grants for Native American 
         Tribes
       The Senate amendment amends Section 306C of the ConAct to 
     authorize appropriations for $30 million in grants, $30 
     million in loans, and $20 million in grants to benefit Indian 
     tribes each year 2002-2006. (Section 630)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 6010)
     (31) Rural Business Enterprise Grants
       The Senate amendment amends Section 310B(c)(1) of the 
     ConAct by creating a priority in awarding grants under this 
     program to non-profit entities operating on tribal land in an 
     area with a population of no more than 5,000. (Section 632)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 6014)
       In many rural tribal communities, tribes and tribal 
     governments play a dominant role in the economic development 
     of the area. As a result, unique patterns of economic 
     development exist whereby the local economy is often composed 
     of a single dominant employer. Because of these 
     circumstances, many organizations located in isolated tribal 
     communities are often unable to receive assistance from the 
     Rural Business Enterprise Grant program. The Managers 
     recognize the different patterns of economic development that 
     exist in many rural tribal communities.
       It is the Managers expectation that funds made available 
     under this provision will be used to assist in the financing 
     or development of small and emerging businesses located in 
     communities of less than 5,000 people on tribal lands or 
     former tribal lands without respect to revenue or employee 
     limitations. Funds made available under this provision may 
     only be used to create, expand or operate value-added 
     agricultural processing facilities.
     (32) Grants to Broadcasting Systems
       The Senate amendment amends section 310B(f) of the ConAct 
     by adding: $5 million is authorized per year from 2002-2006 
     for this subsection. (Section 634)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 6016)
     (33) Value-Added Intermediary Relending Program
       The Senate amendment amends sec. 310B of the ConAct. The 
     Secretary shall make loans to eligible intermediaries, 
     including State agencies, to make loans to recipients for 
     projects to establish, enlarge, or operate enterprises adding 
     value to agriculture products and commodities. Intermediaries 
     shall give preference to bioenergy projects. Limits loans to 
     $2 million except in cases where the intermediary is a state 
     agency. Authorizes $15 million to be appropriated for fiscal 
     years 2003-2006. (Section 636)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (34) Use of Rural Development Loans and Grants for Other 
         Purposes
       The Senate amendment amends subtitle A of the ConAct. If, 
     after making a loan or grant, the Secretary determines the 
     circumstances under which the loan or grant was made have 
     sufficiently changed, the Secretary may allow the recipient 
     to use the loan or grant for other purposes, meeting certain 
     requirements. (Section 637)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 6018)
     (35) Simplified Application Forms for Loan Guarantees
       The Senate amendment amends Sec. 333A of the ConAct. The 
     Secretary shall provide lenders a simplified application for 
     guarantees of farmer program loans under $100,000 and B&I 
     guaranteed loans under $400,000. It also provides that after 
     2003, USDA may increase to $600,000 the limit on the size B&I 
     loans eligible to use the simplified application process. The 
     Secretary shall develop a process that accelerates processing 
     applications for water and waste disposal grants and loans. 
     (Section 638)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to allow the simplified application process to 
     be used for guarantees of farmer program loans under 
     $125,000. (Section 6019)
     (36) Definition of Rural and Rural Area
       The Senate amendment amends sec 343(a) of the ConAct so 
     that a ``rural area'' means a city, town or unincorporated 
     area with a population of 50,000 or less (applied to 
     Community Facility loans and grants, B&I direct and 
     guaranteed loans, Sections 601 and 638); 10,000 or less for 
     water and waste disposal grants and loans. Other definitions 
     of rural are provided for multijurisdictional regional 
     planning organizations and the microenterprise program 
     (Section 639)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     a technical amendment to clarify the definition of ``rural'' 
     and ``rural areas'', and reduce the population requirement 
     for the Community Facilities Program from 50,000 to 20,000. 
     (Section 6020)
     (37) Rural Enterprises and Microenterprise Assistance Program
       The Senate amendment spends $10 million each year from 
     2002-2006. Amends Subtitle D of the ConAct to establish a 
     Program to provide low- and moderate-income individuals with 
     skills to start new small businesses in rural areas, and to 
     provide continuing technical assistance through local 
     organizations as these new businesses begin operating. Grants 
     may be made to qualified organizations to provide training 
     and technical assistance. (Section 642)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (38) Rural Seniors
       The Senate amendment amends Subtitle D of the ConAct. The 
     Secretary shall establish an interagency committee to examine 
     special problems of rural seniors and report recommendations 
     to the Senate and House Ag Committees.
       Authorizes $25 million to be appropriated each fiscal year 
     2003-2006 for grants to nonprofit organizations of up to 20% 
     of the cost of programs that provide facilities, equipment 
     and technology for seniors.
       Reserves no less than 12.5% of the Community Facilities 
     program funds for Senior Facilities up to April 1 of each 
     fiscal year.
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (39) Children's Day Care Facilities
       The Senate amendment provides that Sec 306(a)(19) of the 
     ConAct is amended to reserve no less than 10% of the 
     Community Facilities funds for grants to pay the cost share 
     of developing and constructing day care facilities for 
     children in rural areas up to April 1 of each fiscal year. 
     (Section 642)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 6004)
     (40) Rural Telework
       The Senate amendment amends Subtitle D of the ConAct. The 
     Secretary shall make a grant to an eligible organization to 
     pay the cost of establishing a national rural telework 
     institute. Nonprofit organizations and educational 
     institutions may receive a grant of up to $500,000 for 
     obtaining equipment and facilities to establish, expand or 
     operate telework locations in rural areas. A 50% match is 
     required. Authorizes $30 million for each fiscal year 2002-
     2006, of which $5 million each year will establish the 
     institute. (Section 643)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that the matching requirement for a grant be 30 
     percent the first three years of a project and 50 percent 
     during the fourth and fifth years. The Conference substitute 
     also prescribes non-federal contribution requirements and 
     grant amounts. (Section 6022)
     (41) Historic Barn Preservation
       The Senate amendment provides that Subtitle D of the ConAct 
     is amended so the Secretary may make grants or enter into 
     agreements with states to rehabilitate, preserve, or identify 
     historic barns. Authorizes $25 million total for fiscal years 
     2002-2006. (Section 644)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to authorize such sums as necessary. (Section 
     6023)
     (42) Grants for Emergency Weather Radio Transmitters
       The Senate amendment amends Subtitle D of the ConAct. 
     Authorizes $2 million each fiscal year 2002-2006 so the 
     Secretary may make grants to public and nonprofit entities 
     for acquiring radio transmitters to increase coverage of 
     rural areas by the emergency weather broadcast system. 
     (Section 645)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     a technical amendment. (Section 6024)
       The Managers are concerned that many rural and remote areas 
     in the United States do not have access to timely and 
     accurate alerts and warnings regarding severe weather in the 
     vicinity. In many cases, timely weather warnings may be the 
     difference between life and death for individuals in the path 
     of severe weather. It is the Managers intent that this grant 
     program increase the coverage area of the all hazards weather 
     radio broadcast system of the National Oceanic and 
     Atmospheric Administration to as many rural and remote areas 
     as possible.
     (43) Delta Regional Authority
       The Senate amendment provides that Sec. 382D of the Con Act 
     is amended to clarify (as a drafting matter) the provision 
     relating to supplements to federal grant programs. Subtitle D 
     of the Con Act is amended to add 4 Alabama counties to the 
     definition of Lower Mississippi, and to allow grants for 
     research at a particular university. Sec. 382M(a) of the Con 
     Act is amended by extending authorization of appropriations 
     and authority to 2006. (Section 647)

[[Page H1950]]

       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment clarifying the voting structure. (Section 6027)
     (44) SEARCH Grants for Small Communities
       The Senate amendment amends the ConAct. States may 
     establish a Council that may apply for a grant of no more 
     than $1 million. The Council will use this funding to award 
     SEARCH (special environmental assistance for the regulation 
     of communities and habitat) grants to communities with a 
     population with 2,500 or less for an environmental project or 
     to comply with an environmental law. Authorizes $51 million 
     in appropriations and such sums as are necessary to carry out 
     this section. (Section 648)
       The House bill contains no comparable provision.
       The Conference substitute does not amend the ConAct. It 
     adopts the Senate provision with an amendment to administer 
     this program through the State Rural Development Directors, 
     in coordination with the environmental protection director of 
     the State. (Sections 6301, 6302, 6303, 6304)
       The consultation and coordination provided by the 
     Environmental Protection Agency is for technical and 
     informational purposes; the Managers intend that the State 
     rural development directors award SEARCH grants in each 
     state. Annual appropriations are authorized at $1,000,000 per 
     state per year.
       The State rural development directors are expected to 
     appoint the members of the independent citizens' councils, 
     which will help receive and review SEARCH grant applications 
     from communities in the state. After a review of the 
     applications by the council, in coordination with the State 
     rural development director and the state environmental 
     protection director, the State rural development directors 
     will award SEARCH grants to communities for environmental 
     projects that are necessary to carry out initial feasibility 
     studies or to assist communities that demonstrate an 
     inability to obtain sufficient funding from traditional 
     sources as determined by the State rural development 
     directors, in coordination with state environmental directors 
     and the Council. Some State and Federal environmental laws 
     and regulations require initial feasibility or environmental 
     studies prior to undertaking an environmental project. It is 
     the Managers' intent that SEARCH grants provided to 
     communities for the purposes of carrying out an initial 
     feasibility or environmental study be consistent with 
     applicable State and Federal laws. It is not the Managers' 
     intent to prohibit SEARCH grants to communities for initial 
     feasibility or environmental studies where such requirements 
     do not exist.
       The Managers are aware that many communities do not have 
     experts with the technical ability to complete the paperwork 
     and other documents accompanying traditional funding 
     programs. Therefore, it is the Managers' intent that the 
     application process be simplified and streamlined as is 
     practicable. State rural development directors should work 
     with rural communities to identify the requirements of such a 
     simplified application process.
       Many communities coping with environmental laws and 
     regulations are economically distressed and lack the 
     resources to comply with mandates without grant assistance. 
     It is the Managers' intent that State rural development 
     directors not seek a local match from communities for grants 
     awarded if it will result in economic hardship to the 
     community in question. State rural development directors 
     should reserve match requirements for specific situations and 
     circumstances, and allow communities reasonable amounts of 
     flexibility to provide, in lieu of cash payment, in-kind 
     contributions when calculating the cost-share amount.
     (45) Northern Great Plains Regional Authority
       The Senate amendment amends the ConAct to establish the 
     Authority to be composed of one member appointed by the 
     President and confirmed by the Senate, and the Governors of 
     the states participating in the Authority (Iowa, Minnesota, 
     Nebraska, North Dakota and South Dakota). The Authority may 
     approve grants to state and local governments, public and 
     nonprofit entities for projects including transportation and 
     telecommunication infrastructure, business development, and 
     job training. Establishes distressed areas in which to target 
     funding as well as a minimum requirement for the distribution 
     of funds among the states. State and regional development 
     plans and grant applications must be approved by the 
     Authority. Authorizes $30 million each fiscal year 2002-2006 
     for the Authority, which expires in 2006. (Section 649)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision 
     (Section 6028)
       The Northern Great Plains Regional Authority is authorized 
     in the states of Iowa, Minnesota, Nebraska, North Dakota, and 
     South Dakota. The Authority is expected to develop a series 
     of comprehensive coordinated plans for the economic 
     development of the region. The Conference substitute 
     authorizes appropriations of $30,000,000 in each of fiscal 
     years 2002 through 2007.
       Grants will be made by the Authority particularly to those 
     counties which are distressed, with a special emphasis on 
     transportation, telecommunications, and basic infrastructure 
     such as sewer and water facilities as funds become available. 
     The Managers recognize the ongoing rural development efforts 
     that have evolved from the recommendations of the Northern 
     Great Plains Rural Development Commission. The Commission was 
     established in 1994 through the passage of P.L. 103-318 to 
     prepare a 10-year rural development strategy for the Northern 
     Great Plains Region. The Managers support the efforts of the 
     Northern Great Plains, Inc to implement the Commission's 
     recommendations and urge the Department, along with this 
     organization, to continue to advance the findings of the 
     Commission.
       It is the expectation of the Managers that staff resources 
     of that organization are allocated in a balanced manner to 
     the benefit of all parts of the region. Grants to the 
     Authority must be allocated geographically so each state 
     receives at least one third of its proportional population 
     share without regard to the level of distress of counties in 
     that state.
     (46) Alternative Agricultural Research and Commercialization 
         Corporation
       The House bill extends Sec. 722. Alternative Agricultural 
     research and commercialization revolving fund. (7 U.S.C. 
     5908(g)(1) and capitalization (7 U.S.C. 5908(g)(2) through 
     2011. (Section 651)
       The Senate amendment repeals Subtitle G of Title XVI of the 
     1990 FACTA. The assets of the Corporation are transferred to 
     the Secretary, and funds and any income shall be deposited 
     into an account in the Treasury to pay outstanding claims or 
     obligations of the Corporation and the cost of carrying out 
     this section. There are other conforming amendments. (Section 
     651)
       The Conference substitute adopts the Senate provision with 
     a technical amendment. (Section 6201)
     (47) Telemedicine and Distance Learning Services in Rural 
         Areas
       The Senate amendment amends Section 2335A of the 1990 FACTA 
     to extend this provision through 2006. (Section 652)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 6203)
       The Managers direct that public television entities are 
     eligible to receive assistance under this section for high 
     speed telecommunication services in rural areas to provide 
     educational programming for schools and communities in rural 
     areas.
     (48) Guarantees for Bonds and Notes Issued for 
         Electrification or Telephone Purposes
       The Senate amendment amends the REA. The Secretary shall 
     guarantee bonds and notes issued by an eligible private 
     lender if the proceeds are used for electrification or 
     telephone projects eligible for assistance under this Act. 
     The Secretary may not guarantee the bonds if they are not of 
     reasonable and sufficient quality and for several other 
     reasons. Bonds funding electric generation projects are 
     specifically excluded from this program. Authorizes such sums 
     as are necessary. Provides for fees for the issuance of the 
     guarantees.
       Proceeds from the fees minus certain costs are placed in an 
     economic development subaccount. Grants as provided by 
     current law are made from the subaccount for economic 
     development. (Section 661)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     a technical amendment. (Section 6101)
       This section provides for a new source of private funding 
     for the Rural Economic Development Loan and Grant (REDLG) 
     program. Since enactment in 1987, the REDLG program has 
     provided approximately $185 million in economic development 
     assistance to rural communities in the form of grants and 
     zero-interest loans for rural development projects such as 
     water and waste, business incubator, schools, hospitals, 
     emergency services, and general economic and community 
     development.
       Private funding is provided through the payment of an 
     annual 30 basis point fee by lenders that issue bonds or 
     notes guaranteed by the Administrator of RUS under this 
     section. These fees are placed in a sub-account for the 
     purpose of providing the budget authority for eligible 
     economic development projects through intermediaries 
     participating in the REDLG program.
       The provision provides for safety and soundness and permits 
     the Administrator to deny the request of a lender for a 
     guarantee if the lender does not have expertise and 
     experience in rural utility lending, or issues bonds that, 
     without the guarantee, would not be of investment grade 
     quality. In addition, a lender should provide documentation 
     that the proceeds of a guaranteed bond or note are used for 
     eligible REAct purposes.
       This provision further requires that a private lender make 
     payments on the bonds or notes even if a loan made using the 
     proceeds of such bond or note is not repaid to the lender. 
     This effectively places the lender between the RUS and the 
     borrower minimizing the risk to the government
     (49) Expansion of 911 Access
       The Senate amendment amends Title III of the REA. The 
     Secretary may make telephone loans to state or local 
     governments, Indian tribes, or other public entities for 
     facilities and equipment to expand 911access in rural areas. 
     Authorizes such sums as are necessary. (Section 662)

[[Page H1951]]

       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     a technical amendment. (Section 6102)

                Title VII--Research and Related Matters


                         subtitle a--extensions

     (1) Market Expansion Research
       The House bill extends section 1436(b)(3)(C) of the Food 
     Security Act of 1985 (7 U.S.C. 1632(b)(3)(c)) through 2011. 
     (Section 700)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment to repeal Section 1436 (b)(3)(C) of the Food 
     Security Act of 1985. (Section 7303)
     (2) National Rural Information Center Clearing-House
       The House bill extends section 2381(e) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     3125b(e)) through 2011. (Section 701)
       The Senate amendment amends and generally revises section 
     2381(e) of the Food, Agriculture, Conservation, and Trade Act 
     of 1990 and transfers authority from the research mission 
     area to the rural development mission area. (Section 607)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. The 
     Managers expect the Rural Development mission area of the 
     Department to highlight the existence and resources of the 
     Rural Information Center of the National Agricultural Library 
     on its websites and in its informational materials. (Section 
     7101)
     (3) Grants and Fellowships for Food and Agricultural Sciences 
         Education
       The House bill extends section 1417(1) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3152(1)) through 2011. (Section 702)
       The Senate amendment amends section 1417 of NARETPA in 
     several places to expressly include teaching and educational 
     programs in ``rural economic, community, and business 
     development'' as eligible purposes or recipients under this 
     grant program and extends the authorization through 2006. 
     (Section 703)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7102)
     (4) Policy Research Centers
       The House bill extends section 1419A(d) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3155(d)) through 2011. (Section 703)
       The Senate amendment extends NARETPA (7 U.S.C. 3155(d)) 
     through 2006. (Section 706(2)).
       The Conference Substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7103)
     (5) Human Nutrition Intervention and Health Promotion 
         Research Program
       The House bill extends section 1424(d) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3174(d)) through 2011. (Section 704)
       The Senate amendment amends section 1424 of NARETPA to 
     extend authorization through 2006. (Section 707)
       The Conference Substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7104)
     (6) Pilot Research Program To Combine Medical and 
         Agricultural Research
       The House bill extends section 1424A(d) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3174a(d)) through 2011. (Section 705)
       The Senate amendment extends section 1424A of the NARETPA 
     through 2006. (Section 708)
       The Conference Substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7105)
     (7) Nutrition Education Program
       The House bill extends section 1425(c)(3) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3175(c)(3)) through 2011. (Section 706)
       The Senate amendment extends section 1425 of NARETPA 
     through 2006. (Section 709)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7106)
     (8) Continuing Animal Health and Disease Research Programs
       The House bill extends section 1433(a) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3195(a)) through 2011. (Section 707)
       The Senate amendment extends section 1433 of NARETPA 
     through 2006. (Section 710)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7107)
     (9) Appropriations for Research on National or Regional 
         Problems
       The House bill extends section 1434(a) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3196(a)) through 2011. (Section 708)
       The Senate amendment extends section 1434 of NARETPA 
     through 2006. (Section 711)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7108)
     (10) Grants to Upgrade Agricultural and Food Sciences 
         Facilities at 1890 Land-Grant Colleges, Including 
         Tuskegee University
       The House bill extends section 1447(b) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3222b(b)) through 2011. (Section 709)
       The Senate amendment amends section 1447 of NARETPA to 
     increase the authorization from $15 million to $25 million 
     and extends the authorization through 2006. (Section 760)
       The Conference substitute adopts the Senate provision with 
     an amendment authorizing such sums as necessary and extending 
     the authorization through 2007. (Section 7109) (Section 7109)
     (11) National Research and Training Centennial Centers at 
         1890 Land-Grant Institutions
       The House bill extends section 1448(a)(1) and (f) of the 
     National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 (7 U.S.C. 3222c(a) (1) and (f)) through 
     2011. (Section 710)
       The Senate amendment extends section 1448 of NARETPA 
     through 2006 and strikes ``centennial'' and replaces it with 
     ``virtual'' each place it appears. (Section 761)
       The Conference Substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7110)
     (12) Hispanic Serving Institutions
       The House bill extends section 1455(c) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3241(c)) through 2011. (Section 711)
       The Senate amendment extends section 1455 of NARETPA 
     through 2006. (Section 712)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7111)
     (13) Competitive Grants for International Agricultural 
         Science and Education Programs
       The House bill extends section 1459A(c) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3292b (c)) through 2011. (Section 712)
       The Senate amendment extends section 1459A of NARETPA 
     through 2006. (Section 713)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7112)
     (14) University Research
       The House bill extends subsections (a) and (b) of section 
     1463 of the National Agricultural Research, Extension, and 
     Teaching Policy Act of 1977 (7 U.S.C. 3311(a) and (b)) 
     through 2011. (Section 713)
       The Senate amendment extends section 1463(a) of NARETPA to 
     increase the authorization from $850 million per year to $1.5 
     billion per year, and extends the authorizations in 
     subsections (a) and (b) to 2006. (Section 716)
       The Conference substitute adopts the House provision with 
     an amendment authorizing such sums as necessary and extending 
     the authorization through 2007. (Section 7113)
       The Managers encourage the Secretary to review USDA 
     competitive grants programs administered by the Cooperative 
     States Research, Education and Extension Service and provide 
     to Congress a report that includes an accounting of the 
     success of minority-serving institutions in accessing 
     competitive research funding during the applicable fiscal 
     year, and recommendations for steps that Congress, the 
     Administration and the minority-serving institutions might 
     take to achieve greater success by minority-serving 
     institutions in securing competitively awarded grant funds.
     (15) Extension Service
       The House bill extends section 1464 the National 
     Agricultural, Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3312) through 2011. (Section 714)
       The Senate amendment extends section 1464 of NARETPA to 
     increase the authorization from $420 million to $500 million 
     and extend it through 2006. (Section 717)
       The Conference substitute adopts the House provision with 
     an amendment authorizing such sums as necessary and extending 
     the authorization through 2007. (Section 7113)
       The Managers recognize the importance of ensuring that 
     America's farmers and ranchers have the tools necessary to 
     remain the most productive, efficient and competitive 
     producers in the global marketplace. Due to the complexity of 
     marketing and management issues, intensive educational 
     efforts have proven effective in helping producers increase 
     their returns. The Agricultural Risk Protection Act 
     acknowledged the need to establish a risk management 
     education program to inform agricultural producers about the 
     full range of risk management activities available to them.
       One program that has proven to be successful is the Master 
     Marketer Educational System (MMES) conducted by Texas 
     Cooperative Extension. This intensive training course takes 
     producers from an intermediate to an advanced level in 
     marketing/risk management. Program graduates serve as 
     volunteer leaders in establishing and /or revitalizing 
     marketing clubs in their home county to share what they have 
     learned. Two-year post-training surveys have indicated that 
     graduates have increased their returns by

[[Page H1952]]

     $25,000 to $30,000 per year. While the Master Marketer 
     training and marketing clubs are the cornerstones of the 
     system, MMES also includes an advanced topic series for 
     producers and an in-depth risk management training for 
     lenders. The Managers encourage the Secretary of Agriculture 
     to expand such programs to provide quality risk management 
     training for farmers across the country.
     (16) Supplemental and Alternative Crops
       The House bill extends section 1473D(a) the National 
     Agricultural, Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3319d(a)) through 2011. (Section 715)
       The Senate amendment extends section 1473D of NARETPA 
     through 2006. (Section 720)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7115)
     (17) Aquaculture Research Facilities
       The House bill extends section 1477 of the National 
     Agricultural, Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3324) through 2011. (Section 716)
       The Senate amendment extends section 1477 of NARETPA 
     through 2006. (Section 721)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7116)
     (18) Rangeland Research
       The House bill extends section 1483(a) of the National 
     Agricultural, Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3336(a)) through 2011. (Section 717)
       The Senate amendment extends section 1483 of NARETPA 
     through 2006. (Section 722)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7117)
     (19) National Genetics Resources Program
       The House bill extends section 1635(b) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5844(b)) is extended through 2011. (Section 718)
       The Senate amendment extends section 1635 of the FACT Act 
     through 2006. (Section 731)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7118)
     (20) High-Priority Research and Extension Initiatives
       The House bill extends section 1672(h) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5925(h)) is extended through 2011. (Section 719)
       The Senate amendment extends section 1672 of the FACT Act 
     through 2006. Section 734)
       The Conference substitute combines the House and Senate 
     provision, conforming to the format of the House provision 
     and extending the authorization through 2007. (Section 7119)
       The Managers note that the US Department of Agriculture has 
     relocated the Western Human Nutrition Research Center (WHNRC) 
     to the University of California, Davis campus. In order to 
     ensure that the full potential of a research and education 
     partnership between the WHNRC and the University is realized, 
     the Managers fully expect the Secretary of Agriculture to 
     establish a Cooperative Agreement, to replace the current 
     Memorandum of Understanding, with the University of 
     California for the management of the WHNRC by August 1, 2002.
       The Managers expect that the Secretary shall, in making 
     grants under paragraph 41, give priority to proposals to: i) 
     establish and coordinate priorities for genetic evaluation of 
     domestic beef cattle; (ii) consolidate research efforts to 
     reduce duplication of effort and maximize the return to beef 
     industry; (iii) streamline the process between the 
     development and adoption of new genetic evaluation 
     methodologies by the industry; (iv) identify new traits and 
     technologies for inclusion in genetic programs in order to 
     reduce the costs of beef production and provide consumers 
     with a high nutritional value, healthy, and affordable 
     protein source or create decision making tools that 
     incorporate the increasing number of traits being evaluated 
     and the increasing amount of information from DNA technology 
     into genetic improvement programs, with the goal of 
     optimizing the overall efficiency, product quality and 
     safety, and health of the domestic beef cattle herd resource.
       The Managers recognize the importance of proper management 
     and stewardship of the Ogallala Aquifer and other natural 
     resources to the long-term viability of agricultural 
     enterprises and communities in the Central and Southern Great 
     Plains. The Managers recognize the ongoing efforts of 
     educational institutions and agricultural entities in this 
     region that have expertise in developing enhanced management 
     strategies for conserving water, natural resources and 
     associated agricultural infrastructure in order to protect 
     the region's economic integrity over the long term. The 
     Managers commend multi-disciplinary research efforts to 
     develop new technologies and strategies to manage and utilize 
     water and natural resources to produce sustainable economic 
     returns.
       To maintain the economic vitality and rural population base 
     of the Central and Southern Great Plains, the Secretary is 
     encouraged to give priority to and fund collaborative 
     research efforts that seek to protect the water and natural 
     resources of this region.
     (21) Nutrient Management Research and Extension Initiative
       The House bill extends section 1672A(g) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5925a(g)) through 2011. (Section 720)
       The Senate amendment extends section 1672A of the FACT Act 
     through 2006. (Section 735)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7120)
       The Managers acknowledge the many benefits of the worm 
     farming industry. Worm farms, while not recognized in any 
     specific program within the USDA, provide considerable 
     environmental benefits. By recycling organic waste, worms 
     fertilize our agriculturally productive lands and improve 
     nutrient-deficient soil. The Managers encourage the USDA to 
     study and promote worm farming industry techniques that are 
     beneficial to the environment.
     (22) Agriculture Telecommunications Program
       The House bill extends section 1673(h) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5926(h)) through 2011. (Section 721)
       The Senate amendment extends section 1673 of the FACT Act 
     through 2006. (Section 737)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7121)
     (23) Alternative Agricultural Research and Commercialization 
         Revolving Fund
       The House bill extends section 1664(g)(1) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5908(g)(1) and the capitalization section 1664(g)(2)of the 
     FACT Act (7 U.S.C. 5908(g)(2)) is extended through 
     2011.(Section 722)
       The Senate amendment repeals the provision and provides 
     authority to the Secretary for the orderly disposal of AARCC 
     assets. (Section 651)
       The Conference substitute adopts the Senate provision (Sec. 
     6201).
     (24) Assistive Technology Program for Farmers With 
         Disabilities
       The House bill extends section 1680(c)(1) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5933(c)(1)) through 2011.
       The Senate amendment extends section 1680 of the FACT Act 
     through 2006.
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7122)
     (25) Partnerships for High-Value Agricultural Product Quality 
         Research
       The House bill extends section 402(g) of the Agricultural 
     Research, Extension, and Education Reform Act of 1998 (7 
     U.S.C. 7622(g)) through 2011.(Section 724)
       The Senate amendment extends section 402 of AREERA through 
     2006. (Section 742)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Secion 7123)
     (26) Biobased Products
       The House bill extends section 404(e)(2) of the 
     Agricultural Research, Extension, and Education Reform Act of 
     1998 (7 U.S.C. 7624(e)(2)) and section 404(h) the 
     authorization of appropriations of the Agricultural Research, 
     Extension, and Education Reform Act of 1998 (7 U.S.C. 
     7624(h)) through 2011. (Section 725)
       The Senate amendment extends section 404 of AREERA for the 
     basic authorization for the program and the authority to 
     conduct the pilot project through 2006. (Section 744)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7124)
     (27) Integrated Research, Education, and Extension 
         Competitive Grants Program
       The House bill extends section 406(e) of the Agricultural 
     Research, Extension, and Education Reform Act of 1998 (7 
     U.S.C. 7626(e)) through 2011. (Section 726)
       The Senate amendment amends section 406 of AREERA to 
     provide that the term for a grant under that section shall 
     not exceed 5 years and to extend the authorization through 
     2006. (Section 746)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7125)
     (28) Institutional Capacity Building Grants
       The House bill extends section 535(b)(1) of the Equity in 
     Educational Land-Grant Status Act of 1994 (7 U.S.C. 301 note) 
     through 2011. (Section 727)
       The Senate amendment amends section 535 of the Act to 
     extend the authorization for institutional capacity building 
     grants through 2006 and change the authorized amount from 
     $1.7 million per year to such sums as necessary. (Section 
     755(f))
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7126)
     (29) 1994 Institution Research Grants
       The House bill extends section 536(c) of the Equity in 
     Educational Land-grant States Act of 1994 (7 U.S.C. 301 note) 
     through 2011. (Section 728)

[[Page H1953]]

       The Senate amendment amends section 536 of the Act to 
     extend the authorization for the research grants program 
     through 2006. (Section 755(g)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7127)
     (30) Endowment for 1994 Institutions
       The House bill extends section 533(b) of the Equity in 
     Educational Land-grant States Act of 1994 (7 U.S.C. 301 note) 
     through 2011. Current authorization limit of $4,600,000 is 
     amended to ``such sums as are necessary''. (Section 729)
       The Senate amendment extends the authorization of the 1994 
     Institutions endowment under section 533 of the Act through 
     2006 and changes the amount from $4.6 million per fiscal year 
     to such sums as are necessary. (Section 755(c))
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7128)
     (31) Precision Agriculture
       The House bill extends section 403(i) of the Agricultural 
     Research, Extension, and Education Reform Act of 1998 (7 
     U.S.C. 7623(i) through 2011. (Section 730)
       The Senate amendment extends section 403 of AREERA through 
     2006. (Section 743)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7129)
     (32) Thomas Jefferson Initiative for Crop Diversity
       The House bill extends section 405(h) of the Agricultural 
     Research, Extension, and Education Reform Act of 1998 (7 
     U.S.C. 7625(h) through 2011. (Section 731)
       The Senate amendment extends section 405 of AREERA through 
     2006. (Section 745)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7130)
     (33) Support for Research Regarding Diseases of Wheat, 
         Triticale, and Barley Caused by Fusarium graminearum or 
         by Tilletitia indica
       The House bill extends section 408(e) of the Agricultural 
     Research, Extension, and Education Reform Act of 1998 (7 
     U.S.C. 7628(e) through 2011.
       The Senate amendment extends section 408 of AREERA through 
     2006. (Section 747)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007 and 
     strike the dollar figure and authorize such sums as are 
     necessary. (Section 7131)
     (34) Office of Pest Management Policy
       The House bill extends section 614(f) of the Agricultural 
     Research, Extension, and Education Reform Act of 1998 (7 
     U.S.C. 7653(f)) through 2011. (Section 733)
       The Senate amendment extends section 614 of AREERA through 
     2006. (Section 750A)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7132)
     (35) National Agricultural Research, Extension, Education and 
         Economics Advisory Board
       The House bill extends section 1408(h) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3123(h) through 2011. (Section 734)
       The Senate amendment amends section 1408 of NARETPA to 
     extend the term of the Board through 2006. (Section 702)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7133)
     (36) Grants for Research on Production and Marketing of 
         Alcohols and Industrial Hydrocarbons From Agricultural 
         Commodities and Forest Products
       The House bill extends section 1419(d) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3154(d)) through 2011. (Section 735)
       The Senate amendment extends section 1419 of NARETPA 
     through 2006. (Section 705)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7134)
     (37) Biomass Research and Development
       The House bill extends title III of the Agricultural Risk 
     Protection Act of 2000 (7 U.S.C. 7624 note) through 2011. 
     (Section 736)
       The Senate amendment extends title III of ARPA through 
     2006. (Section 903)
       The Conference Substitute adopts the Senate provision with 
     amendments. The conference substitute provides $12,500,000 
     annually for each fiscal year 2002-2007. (Section 9008)
     (38) Agricultural Experiment Stations Research Facilities
       The House bill extends section 6(a) of the Research 
     Facilities Act (7 U.S.C. 390d(a)) through 2011. (Section 737)
       The Senate amendment extends section 6 of the Research 
     Facilities Act through 2006. (Section 782)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7135)
     (39) Competitive, Special, and Facilities Research Grants, 
         National Research Initiative
       The House bill extends subsection 2(b)(10) of the 
     Competitive, Special, and Facilities Research Grant Act (7 
     U.S.C. 450(i)(b)(10)) through 2011. (Section 738)
       The Senate amendment extends subsection (b)(10) through 
     2006. (Section 784)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7136)
     (40) Federal Agricultural Research Facilities Authorization 
         of Appropriations
       The House bill extends section 1431 of the National 
     Agricultural Research, Extension, and Teaching Policy Act 
     Amendments of 1985 (P.L. 99-198; 99 Stat. 1556) through 2011. 
     (Section 739)
       The Senate amendment extends section 1431 of the NARETPA 
     through 2006. (Section 783)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7137)
     (41) Cotton Classification Services
       The House bill extends the first sentence of section 3a of 
     the Act of March 3, 1927 (commonly known as the ``Cotton 
     Statistics and Estimates Act; 7 U.S.C. 473a) through 2011. 
     (Section 740)
       The Senate amendment extends the first sentence of section 
     3a of the Act of March 3, 1927 through 2006. (Section 1047)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. (Sec. 
     10501)
     (42) Critical Agricultural Materials Research
       The House bill extends section 16(a) of the Critical 
     Agricultural Materials Act (7 U.S.C. 178n(a)) through 2011. 
     (Section 740A)
       The Senate amendment extends section 16 of the Act through 
     2006. (Section 781)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7138)


                       Subtitle B--Modifications

     (43) Equity in Educational Land-Grant Status Act of 1994
       The House bill amends section 534(a)(1)(A) of the Equity in 
     Educational Land-Grant Status Act of 1994 (7 U.S.C. 301 note) 
     by increasing the authorization of appropriations from 
     $50,000 to $100,000; by modifying the definition by which 
     full-time equivalent Indian Student Count is calculated; by 
     making accreditation requirements; and by updating the names 
     of the 1994 institutions. (Section 741)
       The Senate amendment has the same language but also adds 
     White Earth Tribal and Community College to the list of 1994 
     Institutions. (Section 755)
       The Conference substitute adopts the House provision for 
     741(a), the Senate provision for 741(b), the Senate provision 
     for 741(c), and the Senate provision for 741(d) with an 
     amendment that adds White Earth Tribal and Community College 
     to list of 1994 Institutions and requires USDA to report to 
     Congress with guidance on standards for future additions. 
     (Section 7201)
     (44) The National Agricultural Research, Extension, and 
         Teaching Policy Act of 1977
       The House bill amends Section 1404(4) of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7.U.S.C. 3103(4)) by adding 1994 institutions to the 
     definition of colleges and universities. Intent is to make 
     1994 land grant institution eligible for competitive grants. 
     (Section 742)
       The Senate amendment has the same intent, but adds the 1994 
     Institutions to the list of institutions eligible for the 
     Integrated Grants Program in section 406 of AREERA. (Section 
     756)
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7209)
     (45) Agricultural Research, Extension, and Education Reform 
         Act of 1998
       The House bill amends section 401(c)(2) of the Agricultural 
     Research, Extension, and Education Reform Act of 1998 (7 
     U.S.C. 7621(c)(2)) by adding:
       (1) alternative fuels and renewable energy sources to 
     Priority Mission Areas ;
       (2) by including energy efficiency in priority research 
     areas in Precision Agriculture (7 U.S.C. 7623; by including 
     energy efficiency in priority research areas of the Thomas 
     Jefferson Initiative for Crop Diversity (7 U.S.C. 7625(a));
       (3) by including energy efficiency and renewable resources 
     in priority research areas of the Coordinated Program of 
     Research, Extension, and Education to Improve Viability of 
     Small and Medium Size Dairy, Livestock, and Poultry 
     Operations (7 U.S.C. 7627);
       (4) by amending section 408 of AREERA, Support for Research 
     Regarding Diseases of Wheat, Triticale, and Barley caused by 
     Fusarium graminearum or by Tilletitia Indica (7 U.S.C. 
     7628(a)) to include research related to Karnal bunt 
     identification and control; and
       (5) by adding a new section to the Agricultural Research, 
     Extension, and Education Reform Act of 1998 (7 U.S.C. 7621 et 
     seq) to authorize a Program to Control Johne's Disease. 
     (Section 743)
       The Senate amendment provides for the definition of 
     precision agriculture, adds ``horticultural'' into subsection 
     (a)(3)(A), adds a new subsection (a)(3) (E) to read ``using 
     such information to enable intelligent mechanized harvesting 
     and sorting systems for horitcultural crops''; and adds a new 
     subsection (a)(4)(E) to read ``robotic and other intelligent 
     machines for use in horticultural cropping systems'' and in 
     subsection

[[Page H1954]]

     (c)(2) by adding ``horticultural'' after ``agronomic'' and 
     adding ``product variability''. (Section 743)
       The Conference substitute adopts the Senate provision from 
     743(a) and the House provision from 743(b), (c), (d), (e), 
     and (f). (Section 7207)
       The Managers do not intend that any future funds made 
     available for Tilletia indica (commonly referred to as Karnal 
     Bunt) research would be taken from the amount presently made 
     available for research related to Fusarium graminearum 
     (commonly referred to as Wheat Scab).
     (46) Food, Agriculture, Conservation, and Trade Act of 1990
       The House bill amends section 1671(b) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5924(b)) to include plant pathogens as an eligible research 
     priority. The House bill also amends the High-Priority 
     Research and Education Initiative section 1672(e) of the FACT 
     Act (7 U.S.C. 5925(e)) to include several new high-priority 
     research and extension projects:
       research to protect the United States food supply and 
     agriculture from bioterrorism
       wind erosion research
       crop loss research and extension
       land use management research and extension
       water and air quality research and extension
       revenue and insurance tools research and extension
       agrotourism research and extension
       harvesting productivity for fruits and vegetables
       nitrogen-fixation by plants
       agricultural marketing
       environment and private lands research and extension
       livestock disease research and extension
       plant gene expression (Section 744)
       The Senate amendment amends section 1672 of the FACT Act to 
     extend the authorization through 2006 and add the following 
     new high-priority research and extension areas:
       animal infectious diseases research and extension
       program to combat childhood obesity
       integrated pest management
       beef cattle genetics
       dairy pipeline cleaner (with a set-aside of not less than 
     $100,000 of authorized funds for this purpose)
       plant and animal varieties (Section 743)
       The Conference substitute adopts the House provision for 
     Section 744(a) and the Senate provision for Section 744(b) 
     with an amendment conforming Senate provisions to the format 
     of the House provision and combining both the House and 
     Senate lists of high priority research and extension 
     projects. Additional priorities to be named are Genetically 
     Modified Agriculture Products Research, Publicly Held Plant 
     and Animal Varieties, and Sugarcane Genetics. New language is 
     added to the assistive technology program for farmers with 
     disabilities to ensure full consideration is given to 
     entities applying for grants but have not previously received 
     grants.. (Section 7208)
       The Managers recognize the success of state AgrAbility 
     programs that have benefited from assistive technology 
     competitive grants. The Managers understand the difficulty 
     faced by new applicants in competing with established 
     programs for limited funds. To continue the success of this 
     program and broaden its scope to additional states, the 
     Managers encourage full funding of the program and urge the 
     Secretary to give full consideration to the potential merits 
     of eligible programs that have not previously received a 
     grant award.
     (47) The National Agricultural Research, Extension, Education 
         and Teaching Policy Act of 1977
       The House bill amends section 1408 of the National 
     Agricultural Research Extension, Education and Teaching 
     Policy Act of 1977--National Agricultural Research, 
     Extension, Education, and Economics Advisory Board. (7 U.S.C. 
     3123) to add a non Land-grant college or university 
     representative to the board, and provide authority for the 
     board to consult with Congress and non-research agencies of 
     the U.S. Department of Agriculture. Total Membership of the 
     Advisory Board is increased from 30 to 31 members; and 
     section 1419 of that Act--Grants for Research on Production 
     and Marketing of Alcohols and Industrial Hydrocarbons from 
     Agricultural Commodities and Forest Products (7 U.S.C. 3154) 
     to include industrial oilseed crops.
       The National Agricultural Research, Extension, and Teaching 
     Policy Act of 1977 (7 U.S.C. 3291(a)) is also amended to 
     authorize an internship program in Foreign Agriculture 
     Service overseas offices. (Section 745)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment to move the provision concerning the total 
     number of Advisory Board Members from subsection (c) to 
     subsection (a) of House Section 745. New language amends 
     current law to allow for funding of the Joe Skeen 
     Institute for Rangeland Restoration. (Sec. 7209)
     (48) Biomass Research and Development
       The House bill amends title III of the Agricultural Risk 
     Protection Act of 2000 (7 U.S.C. 7624 note) to include 
     biodiesel in the Congressional Statement of Findings, to 
     include animal by-products in the definition of ``Biomass'', 
     and to add a livestock trade association representative to 
     the Biomass Research and Development Technical Advisory 
     Committee. (Section 746)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision.
     (49) Biotechnology Risk Assessment Research
       The House bill amends section 1668 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5921) to ensure that risk assessment projects carried out 
     under this program compare the risks associated with products 
     of agricultural biotechnology to those associated with 
     traditionally bred plants and animals. Assessment is 
     increased from 1% to 3%. (Section 747)
       The Senate amendment amends section 1668 of the FACT Act by 
     inserting a new subsection providing priorities for grant 
     award and raising from 1 percent to 3 percent the amount to 
     be withheld from USDA biotech research outlays for the 
     purpose of making grants under this section for research on 
     biotechnology risk assessment, with new language specifying 
     that the research be ``on all categories identified by the 
     Secretary of Agriculture as biotechnology''.
       Under the new language, ``the Secretary shall give priority 
     to public and private research or educational institutions 
     and organizations the goals of which include--
       (1) formation of interdisciplinary teams to review or 
     conduct research on the environmental effects of the release 
     of new genetically modified agricultural products;
       (2) conduct of studies relating to biosafety of genetically 
     modified agricultural products;
       (3) evaluation of the cost and benefit for development of 
     an identity preservation system for genetically modified 
     agricultural products;
       (4) establishment of international partnerships for 
     research and education on biosafety issues; or
       (5) formation of interdisciplinary teams to renew and 
     conduct research on the nutritional enhancement and 
     environmental benefits of genetically modified agricultural 
     products. (Section 732)
       The Conference substitute adopts the House provision with 
     an amendment adding genetically engineered microorganisms as 
     a priority topic for risk assessment research, including 
     international partnerships on bio-safety as a research 
     priority, and reducing the amount withheld from biotechnology 
     research funding from 3% to 2%. (Section 7210)
     (50) Competitive, Special, and Facilities Research Grants
       The House bill amends section 2(a) of the Competitive, 
     Special, and Facilities Research Grant Act (7 U.S.C. 450i(a)) 
     to provide for consultation on development of program 
     priorities with the National Agriculture Research, Extension, 
     Education, and Economics Advisory Board. (Section 748)
       The Senate amendment amends subsection (b)(2) of the Act to 
     strike the stated substantive areas of national and 
     multistate needs under high priority research and instead 
     provide for the Secretary to determine those needs in 
     consultation with the REE Board not later than July 1 of each 
     fiscal year for the following fiscal year. (Section 784)
       The Conference substitute adopts the Senate provision with 
     an amendment to retain the high priority research focuses 
     prescribed in current law. (Section 7211)
     (51) Matching Funds Requirement for Research and Extension 
         Activities of 1890 Institutions
       The House bill amends section 1449 of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3222d) to phase in an increased matching 
     requirement for non-Federal funds for 1890 land-grant 
     colleges and universities to 100% by 2007. The Secretary is 
     granted authority to waive the matching requirement if it is 
     unlikely that a Territorial college will be able to satisfy 
     the matching requirement in an individual fiscal year. 
     (Section 749)
       The Senate amendment amends the matching requirements for 
     1890 Institution research and extension formula funds in 
     section 1449 of NARETPA to require that a State must match 60 
     percent of Federal funds provided an 1890 Institution in FY 
     2003 and provide a match of 110 percent of the amount 
     required to be matched in the prior fiscal year for FY 2004 
     through 2006. For fiscal years 2003 through 2006, the 
     Secretary may waive any amount of the match above 50 percent 
     for an institution if the Secretary determines that the State 
     will be unlikely to meet the matching requirement. (Section 
     762)
       The Conference substitute adopts the House provision with 
     an amendment to require a unified approach to a phase-in of 
     100% matching requirement over 5 years; extended through 
     2007. (Section 7212)
     (52) Matching Fund Requirement for Research and Extension 
         Activities for the United States Territories
       The House bill amends Section 3(d)4 of the Hatch Act of 
     1877 (7 U.S.C. 361c(d)(4)) and section 3(e)4 of the Smith-
     Lever (7 U.S.C. 343(e)(4)) making a technical correction to 
     establish matching requirements. (Section 749A)
       The Senate amendment has the same intent, but legislative 
     language is drafted significantly differently. (Section 776)
       The Conference substitute adopts the Senate provision. 
     (Section 7213)

[[Page H1955]]

     (53) The Initiative for Future Agriculture and Food Systems
       The House bill amends section 401(b)(1) of the Agricultural 
     Research, Extension, and Education Reform Act of 1998 (7 
     U.S.C. 7621(b)(1)) to provide a total of $1,160,000,000 to be 
     transferred from the Treasury in equal increments for each 
     fiscal year beginning on October 1, 2003 through September 
     30, 2011. Funds transferred beginning on October 1, 2003 
     would be available until expended Funds will be deposited 
     directly into the Commodity Credit Corporation accounts as 
     opposed to a separate account in the Treasury. (Section 750)
       The Senate amendment amends section 401 of AREERA to retain 
     $130 million in mandatory money for 2002 and extend the 
     program for fiscal years 2003 through 2006 at $225 million 
     per fiscal year in mandatory money. Encourages Secretary to 
     set aside 10% of available funds for minority serving 
     institutions. (Section 741)
       The Conference substitute adopts the House provision with 
     an amendment adding ``minority-serving institutions'' to the 
     list of those institutions that have not previously been 
     successful in obtaining competitive grants under current law, 
     adding rural economic policy analysis as a critical issue for 
     research, and extending the authorization for the program 
     through 2007. New language creates a budgetary baseline and 
     provides $1.3 billion in new mandatory funding. (Section 
     7205)
       In making grants to address rural economic and business and 
     community development policy issues, the Managers encourage 
     the agency to solicit and fund research, education, and 
     extension projects on rural policy, rural economic and 
     community development, agriculturally-based development, new 
     and alternative markets, locally-owned value-adding 
     enterprises, and self employment and entrepreneurial 
     opportunities. The Managers also encourage the agency to 
     solicit project proposals addressing critical issues related 
     to improving the effectiveness of Federal rural and 
     agricultural development programs, including projects 
     directly involving rural organizations and rural 
     entrepreneurs that participate in Federal rural development 
     programs.
       The Managers note the importance of funding for the farm 
     efficiency and profitability priority mission area. The 
     Mangers encourage the agency to solicit and fund projects 
     which promote the development of management and marketing 
     systems that improved profitability, including development of 
     diversification and input cost reduction strategies; 
     effective local, regional, and international marketing 
     programs; farm-based value-added processing and new high 
     return production and marketing niches; improved methods of 
     managing risk; and means to improve management and marketing 
     of natural and environmental resources. Also, as part of this 
     priority mission area, the Managers encourage the agency to 
     solicit and fund research and development of farm tenure, 
     transfer, succession, finance, management, production, and 
     marketing models and strategies that foster new farming and 
     ranching opportunities for beginning farmers and ranchers.
     (54) Carbon Cycle Research
       The House bill amends section 221 of the Agricultural Risk 
     Protection Act of 2000 (P.L. 106-224; 114 Stat. 407) to 
     provide an authorization of appropriations so that a 
     discretionary program could be continued. (Section 751)
       The Senate amendment is similar but authorization is 
     extended only through 2006. (Section 787)
       The Conference substitute adopts the House provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7223)
       The Managers recognize the success of the carbon cycle 
     research consortium (created by Sec. 221 of the Agriculture 
     Risk Protection Act of 2000) and encourage these institutions 
     to continue their cooperative work. The Managers understand 
     that the consortium network may be expanded, as deemed 
     appropriate by the consortium, to include additional 
     institutions with interest or expertise in carbon cycle 
     research.
     (55) Definition of Food and Agricultural Sciences.
       The House bill amends section 2(3) of the Research 
     Facilities Act (7 U.S.C. 390(2)(3)) to strike the definition 
     of Food and Agricultural Sciences and instead refer to the 
     definition of Food and Agricultural Sciences in section 
     1408(8) of the National Agricultural Research, Extension, and 
     Teaching Policy Act of 1977 (7 U.S.C. 3103(8)). (Section 752)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 7214)
     (56) Federal Extension Service
       The House bill amends section 3(b)(3) of the Smith-Lever 
     Act (7 U.S.C. 343(b)(3)) to provide that ``such sums as are 
     necessary'' may be appropriated to carry out this section. 
     (Section 753)
       The Senate amendment rewrites section 3(b)(3) of the Smith-
     Lever Act, which authorizes extension funds for the 1994 
     Institutions, to change the authorization from $5 million to 
     such sums as necessary beginning in FY 2002, to change the 
     manner of distribution of such funds from a competitive 
     application basis to a formula to be developed and 
     implemented by the Secretary in consultation with the 1994 
     Institutions, and allows payments for extension activities 
     that may be carried out in more than one fiscal year. 
     (Section 754)
       The Conference substitute adopts the House provision with 
     an amendment to allow the carry-over of funding until 
     expended. (Section 7215)
     (57) Policy Research Centers
       The House bill amends section 1419A(c)(3) of the National 
     Agricultural Research, Extension, and Teaching Policy Act (7 
     U.S.C. 3155(c)(3)) to provide that grant funding may be used 
     to disseminate policy research information. (Section 754)
       The Senate amendment is the same language.
       The Conference substitute adopts the Senate provision. 
     (Section 7216)


                      subtitle c--related matters

     (58) Resident Instruction at Land-grant Colleges in U.S. 
         Territories
       The House bill provides new authority for resident 
     instruction at land-grant colleges in United States 
     Territories, subject to the availability of appropriations. 
     (Section 761)
       The Senate amendment amends section 1404 of the NARETPA of 
     1977 to add a definition for ``insular area'' to include the 
     Commonwealth of Puerto Rico and U.S. Territories. (Section 
     701)
       Also amends NARETPA to add a new subtitle O--Land Grant 
     Institutions in Insular Areas. The ``insular areas'' are 
     defined in section 1404 of NARETPA as amended by section 701 
     of the bill. New section 1489 under that subtitle provides an 
     authorization of $4 million per fiscal year through 2006 for 
     the Secretary to make competitive or noncompetitive grants to 
     State cooperative institutions (i.e., land-grants) in insular 
     areas to strengthen the capacity of such institutions to 
     carry out distance food and agricultural education programs 
     using digital network technologies. Grants may be used: (1) 
     to acquire equipment, instrumentation, networking capability, 
     hardware and software, digital network technology, and 
     infrastructure necessary to teach students and teachers about 
     technology in the classroom; (2) to develop and provide 
     educational services (including faculty development) to 
     prepare students or faculty seeking a degree or certificate 
     approved by the State or a DOE recognized regional 
     accrediting body; (3) to provide teacher education, 
     library and media specialist training, and preschool and 
     teacher aid certification to those who seek to acquire or 
     enhance technology skills for use of technology in the 
     instructional process; (4) to implement a joint project to 
     provide technology education in the classroom with a local 
     educational agency, community-based organization, national 
     nonprofit, or a business; (5) to provide leadership 
     development to administrators, board members, and faculty 
     of eligible institutions with responsibility for 
     technology education. Funds may not be used for the 
     planning, acquisition, construction, rehab, or repair of 
     buildings. The Secretary may carry out the program in a 
     manner that recognizes the different needs and 
     opportunities between institutions in the Pacific and 
     those in the Atlantic. The Secretary may establish a 
     matching requirement of up to 50 percent, which is subject 
     to waiver. (Section 775)
       The Conference substitute adopts the House provision with 
     an amendment to combine House section 761 with Senate 
     sections 701 and 775. The amendment also makes technical 
     changes in Senate section 775, strikes the reference to 
     businesses located within a HUB Zone under the Small Business 
     Act, authorizes funding at such sums as are necessary, and 
     extends the authorization through 2007. (Section 7503)
     (59) Declaration of Extraordinary Emergency and Resulting 
         Authorities
       The House bill amends section 415(e) of the Plant 
     Protection Act (7 U.S.C. 7715(e)), section 442 of the Plant 
     Protection Act (7 U.S.C. 7772), section 11 of the Act of May, 
     1884, commonly known as the ``Animal Industry Act''(21 U.S.C. 
     114a) and the first section of the Act of September 25, 1981 
     (7 U.S.C. 147b) to provide for more efficient management of 
     declarations of extraordinary emergencies and transfer of 
     funds from the Commodity Credit Corporation.
       A new section (419(a)) is added to the Plant Protection Act 
     that requires the Secretary to determine if uses of methyl 
     bromide required by state, local and tribal authorities to 
     control the spread of plant pests and noxious weeds shall be 
     authorized. In addition, the Secretary would maintain a 
     registry of authorized uses. (Section 762)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision for 
     762(a) and deletes the House provision for 762(b). For 
     Section 762(c), the Conference substitute adopts the House 
     provision with an amendment to require the Secretary of 
     Agriculture to consider the availability of methyl bromide 
     alternatives prior to making a determination under this 
     section, and to establish a program, in consultation with 
     State, local and tribal authorities to identify methyl 
     bromide alternatives. Exemptions from regulatory procedures 
     under the Administrative Procedures Act and Paperwork 
     Reduction Act are eliminated. A rule of construction is 
     included to provide that nothing in this section would alter 
     or modify the authority of the Administrator of the 
     Environmental Protection Agency or to provide authority to 
     the Secretary of Agriculture under the Clean Air Act or 
     regulations promulgated under the Clean Air Act. (Section 
     7504)

[[Page H1956]]

     (60) Agricultural Biotechnology Research and Development for 
         the Developing world
       The House bill authorizes the Secretary to use $5 million 
     for each of the fiscal years 2004 through 2008 from funds 
     allocated to the Initiative for Future Food and Agriculture 
     Systems to establish a competitive grants program for the 
     development of agricultural biotechnology in the developing 
     world. (Section 763)
       The Senate amendment provides an authorization of $5 
     million per year from 2002 through 2006 for the Secretary, 
     acting through FAS, to carry out a competitive grant program 
     to develop agricultural biotechnology for developing 
     countries. Eligible recipients would include historically 
     black colleges and universities, Hispanic-serving 
     institutions, tribal colleges or universities that offer a 
     curriculum in agriculture or the biosciences, a nonprofit 
     organization, or a consortium of for-profit institutions and 
     agricultural research institutions. Grants would be available 
     for biotechnology projects that:
       (1) enhance nutritional content of agricultural products 
     that can be grown in developing countries;
       (2) increase the yield and safety of agricultural products 
     that can be grown in the developing countries;
       (3) increase the yield of agricultural products that are 
     drought and stress-resistant and that can be grown in 
     developing countries
       (4) extend the growing range of crops that can be grown in 
     developing countries;
       (5) enhance the shelf-life of fruits and vegetables grown 
     in countries;
       (6) develop environmentally sustainable agricultural 
     products that can be grown in developing countries; and
       (7) develop vaccines to immunize against life-threatening 
     illnesses and other medications that can be administered by 
     consuming genetically engineered agricultural products. 
     (Section 750)
       The Conference substitute adopts the Senate provision with 
     an amendment to modify the definition of ``eligible entity'' 
     to include all colleges and universities with an agricultural 
     or bioscience curriculum and to authorize such sums as 
     necessary through 2007. (Section 7505)


        subtitle d--repeal of certain activities and authorities

     (61) Food safety research information office and national 
         conference
       The House bill repeals subsections (b) and (c) of section 
     615 of the Agricultural Research, Extension, and Education 
     Reform Act of 1998 (7 U.S.C. 7654(b) National Conference and 
     (c)) Food Safety Report. (Section 771)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 7301)
     (62) Reimbursement of expenses under sheep promotion, 
         research, and information Act of 1994
       The House bill repeals section 617 of the Agricultural 
     Research, Extension, and Education Reform Act of 1998 (P.L. 
     105-185; 112 Stat. 607).
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 7302)
     (63) National Genetic Resources Program
       The House bill repeals section 1634 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5843). (Section 773)
       The Senate amendment extends section 1634 of the FACT Act 
     through 2006. (Section 731)
       The Conference substitute adopts the Senate provision with 
     an amendment to authorize through 2007. (Section 7118)
     (64) National Advisory Board on Agricultural Weather
       The House bill repeals section 1639 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 
     5853). (Section 774)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 7304)
     (65) Agricultural Information Exchange with Ireland
       The House bill repeals section 1420 of the National 
     Agricultural Research, Extension and Teaching Policy Act 
     Amendments of 1985 (P.L. 99-198; 99 Stat. 1551)
       No comparable provision. (Section 775)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 7305)
     (66) Pesticide Resistance Study
       The House bill repeals section 1437 of the National 
     Agricultural Research, Extension and Teaching Policy Act 
     Amendments of 1985 (P.L. 99-198; 99 Stat. 1558). (Section 
     775)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 7306)
     (67) Expansion of Education Study
       The House bill repeals section 1438 of the National 
     Agricultural Research, Extension, and Teaching Policy Act 
     Amendments of 1985 (P.L. 99-198; 99 Stat. 1559). (Section 
     777)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 7307)
     (68) Support for advisory board
       The House bill repeals section 1412 of the National 
     Agricultural Research, Extension, and Teaching Policy Act of 
     1977 (7 U.S.C. 3127). (Section 778)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (69) Task force on 10-year strategic plan for agricultural 
         research facilities
       The House bill repeals section 4 of the Research Facilities 
     Act (7 U.S. C. 390b). (Section 779)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. 
     (Section 7308)


              Subtitle E--Agriculture Facility Protection

     (70) Additional Protections for Animal or Agricultural 
         Enterprises, Research Facilities, and other Entities.
       The House bill amends the Research Facilities Act (7 U.S.C. 
     390 et seq.) by adding a new section to provide the Secretary 
     with authority to investigate and assess civil penalties in 
     cases of reckless or intentional destruction of animal or 
     agricultural enterprises. A civil penalty assessed by the 
     Secretary against a person for a violation shall be not less 
     than the total cost incurred by the Secretary and the total 
     cost of the economic damage suffered by the agricultural 
     enterprise. A fund to assist victims of disruption would be 
     established in the Treasury consisting of that portion of 
     each civil penalty that represents the recovery of economic 
     damages. The Secretary of Agriculture shall use the fund to 
     compensate an animal or agricultural enterprise for economic 
     losses. (Section 790)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (71) Competitive Research Facilities Grant Program
       The Senate amendment amends NARETPA to add a new section 
     1417A providing an authorization for a new competitive food 
     and agricultural research facilities grant program 1862 
     Institutions, 1890 Institutions, 1994 Institutions, Hatch 
     experiment stations, McIntire-Stennis schools, veterinary 
     schools under the animal and health disease formula program 
     authorized in NARETPA, and Hispanic-serving institutions. 
     Grants awarded have to support the national research purposes 
     specified in section 1402, States with more than one 
     institution must coordinate proposals, and the Secretary may 
     require a match and may afford an evaluation preference for 
     matches made with cash. (Section 704)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (72) Indirect Costs
       The Senate amendment amends section 1462 of NARETPA by 
     striking the 19 percent cap on indirect costs for competitive 
     agricultural research, education, and extension grants under 
     the authority of the Under Secretary for REE and providing 
     instead that the cap shall be the ``negotiated indirect cost 
     rate established for an institution by the cognizant Federal 
     audit agency for that institution'' and also adds a new 
     subsection specifying that the cap does not apply to SBIR 
     grants (Section 714)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to exempt grants awarded competitively under the 
     Small Business Act. (Section 7222)
     (73) Research Equipment Grants
       The Senate amendment adds a new section 1462A to NARETPA 
     providing an authorization for $50,000,000 per year for a 
     competitive research equipment grants program for the 
     acquisition of special purpose scientific research equipment 
     for use in the food and agricultural sciences programs of 
     colleges and universities and 1862 Institutions, 1890 
     Institutions, 1994 Institutions, Hatch experiment stations, 
     McIntire-Stennis schools, veterinary schools under the animal 
     and health disease formula program authorized in NARETPA, and 
     Hispanic-serving institutions. The maximum amount of a grant 
     is $500,000 and the costs of acquisition or depreciation of 
     equipment purchased with a grant may not be charged as an 
     indirect cost. (Section 715)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to authorize such sums as necessary and extend 
     the authorization through 2007. (Section 7402)
     (74) Availability of Competitive Grant Funds
       The Senate amendment adds a new section 1469A to NARETPA to 
     provide that funds made available to the Secretary to carry 
     out any competitive agricultural research, education, or 
     extension grant programs under NARETPA or any other Act shall 
     be available for obligation for two fiscal years. (Section 
     718)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 7217)
     (75) Joint Requests for Proposals
       The Senate amendment adds a new section 1473B to NARETPA to 
     authorize the Secretary, in carrying out competitive 
     agricultural research, education, or extension grant

[[Page H1957]]

     programs, to cooperate with other Federal agencies in issuing 
     joint request for proposals, awarding grants, and 
     administering grants, for similar or related research, 
     education, or extension projects or activities. Under the 
     provision, with respect to issuing joint requests for 
     proposals, making awards, and administering grants, the 
     Secretary and a cooperating agency each are given authority 
     to: (1) transfer funds to the other; (2) delegate authority 
     to the other; (3) and choose which agencies post-award grant 
     administration regulations and indirect rates shall apply to 
     grant awards made by the Secretary and the cooperating 
     agency. Funds transferred may only be used in accordance with 
     the laws authorizing the appropriation and to make grants 
     only to recipients eligible to receive grants under such 
     laws. The Secretary and cooperating agencies may establish 
     joint peer review panels exempt from FACA to evaluate grant 
     proposals.
       Subsection (b) allows the Secretary to transfer funds to 
     cooperating agencies subject to applicable laws.
       Subsection (c) allows the Secretary to delegate her 
     authority to an appropriate coordinating agency.
       Subsection (d) provides the Secretary with authority to 
     coordinate regulations and indirect rates with a cooperating 
     agency.
       Subsection (e) allows joint peer review panels to be 
     established. (Section 719)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to strike the authority to transfer appropriated 
     funds between Federal Departments and Agencies and to 
     prohibit authority to adopt ``negotiated'' indirect cost 
     recovery rates. (Section 7403)
     (76) Biosecurity Planning and Response Programs
       The Senate amendment subsection (a) adds a new subtitle N--
     Biosecurity to NARETPA. Chapter 1 of the new subtitle 
     (sections 1484 through 1486) deals with agriculture 
     infrastructure security. Authorizations are provided of such 
     sums as necessary through 2006 to establish an Agriculture 
     Infrastructure Security Fund Account (the Fund) in the 
     Treasury and an Agriculture Infrastructure Security 
     Commission. New section 1484 sets forth definitions of 
     ``agricultural research facility,'' ``Commission,'' and 
     ``Fund''.
       New section 1485 authorizes the establishment of the Fund. 
     The Fund would be financed from any appropriations, proceeds 
     from the sale of assets as provided for in this chapter, and 
     gifts accepted as provided for in this chapter, and such 
     amounts would remain available until expended. Subsection (b) 
     sets for the purposes of the Fund as to provide funding to 
     protect and strengthen the Federal food safety and 
     agricultural infrastructure that- (1) safeguards against 
     animal and plant diseases and pests; (2) ensures the safety 
     of the food supply; and (3) ensures sound science in support 
     of food and agricultural policy. Amounts in the Fund may be 
     used by the Secretary for: (1) the costs of planning, design, 
     development, construction, acquisition, modernization, 
     leasing, and disposal of facilities, equipment, and 
     technology used by USDA in carrying out programs related to 
     the purposes specified in subsection (b) , notwithstanding 
     the Federal Property and Administrative Services Act of 1949, 
     or any other law that prescribes procedures for the 
     procurement, use, or disposal of property or services by a 
     Federal agency; (2) the costs of specialized services 
     relating to the purposes specified in subsection (b); (3) the 
     costs of cooperative arrangements (notwithstanding the 
     Federal Grant and Cooperative Agreement Act) with State, 
     tribal, and local governments, and other public and private 
     entities to carry out programs related to the purposes 
     specified in subsection (b); and (4) administrative costs at 
     a rate of not more than 1 percent per fiscal year of amounts 
     in the fund on October 1 of that fiscal year beginning in 
     2003. Amounts in the Fund may not be used to create any new 
     full or part-time Federal employee positions. Notwithstanding 
     the Federal Property and Administrative Services Act, the 
     Secretary by sale may dispose of all or any part of any right 
     or title in land, facilities, or equipment in the full 
     control of the Department used for the purposes specified in 
     subsection (b), with the exception of National Forest System 
     land and land and facilities at the Beltsville Agricultural 
     Research Center. The Secretary is authorized to accept gifts 
     and bequests of funds property (real, personal, and 
     intangible), equipment, services, and other in-kind 
     contributions from any public or private source to carry out 
     the purposes specified in subsection (b). For the purposes of 
     gifts, the Secretary shall not consider a State, local, or 
     tribal government, other public entity, or college or 
     university as a prohibited source under USDA gift acceptance 
     policies, and the Secretary may accept gifts from private 
     entities or individuals that would be considered prohibited 
     sources only if the Secretary determined it was in the public 
     interest to accept such gifts.
       New section 1486 authorizes the Secretary to establish the 
     Agriculture Infrastructure Security Commission to: (1) advise 
     the Secretary on the uses of the Fund; (2) to review all 
     agricultural research facilities for research importance and 
     importance to agriculture infrastructure security, (3) to 
     identify any agricultural research facility that should be 
     closed, realigned, consolidated, or modernized to carry out 
     the research agenda of the Secretary and to protect 
     agriculture infrastructure security; (4) to develop 
     recommendations concerning agricultural research facilities; 
     and (5) to evaluate the agricultural research facilities 
     acquisition and modernization system used by USDA and make 
     recommendations for improvement to that system based on that 
     evaluation. An ``agricultural research facility'' as defined 
     in new section 1484 means a facility- ``(A) at which 
     agricultural research is regularly carried out or proposed to 
     be carried out; and (B) that is--(i)(I) an Agricultural 
     Research Service facility; (II) a Forest Service facility; or 
     (III) an Animal and Plant Health Inspection Service facility; 
     (ii) a Federal agricultural facility in the process of being 
     planned or being constructed; or (iii) any other facility 
     under the full control of the Secretary.'' The Commission is 
     to use the 10-year strategic plan prepared by the Strategic 
     Planning Task Force established under section 4 of the 
     Research Facilities Act to assist it in carrying out its 
     duties. The Commission shall be composed of 15 voting 
     members appointed by the Secretary that represent a 
     balance of the public and private sectors and that have 
     combined expertise in facilities development, 
     modernization, construction, security, consolidation, and 
     closure; plant diseases and pests; animal diseases and 
     pests; food safety; biosecurity; the needs of farmers and 
     ranchers; public health; State, local, and tribal 
     government; and any other area related to agriculture 
     infrastructure security, as determined by the Secretary. 
     Nonvoting members of the Commission shall include the 
     Secretary, four representatives appointed by the Secretary 
     of HHS, 1 each from PHS, CDC, FDA, and NIH; one 
     representative appointed by the Attorney General; one 
     representative appointed by the Director of Homeland 
     Security; and not more than four USDA representatives 
     appointed by the Secretary. The term of office for 
     Commission members is 4 years. The Commission is exempted 
     from FACA, but open meetings and records are required with 
     exceptions provided for purposes of national security. Not 
     later than 240 days after enactment of this Act, and each 
     June 1 thereafter, the Commission shall submit a report of 
     its findings and recommendations to the Committees on 
     Agriculture and Appropriations of the House and Senate, 
     and the Secretary shall provide a written response to that 
     report within 90 days as to the manner and extent to which 
     she will implement the recommendations made. The report, 
     and the Secretary's response, shall be publicly available 
     unless the Secretary or the Commission determine that the 
     report or response, or any portion thereof, shall not be 
     released in the interest of national security, and any 
     portion so classified shall not be releasable under FOIA. 
     Provision is made for compensation of non-Federal voting 
     members at a rate equivalent to GS-15 and travel to be 
     paid at the rate for a Federal employee. The Secretary 
     shall provide the Commission with any personnel or other 
     resources as the Secretary determines appropriate. New 
     chapter 2 of the new subtitle N includes two new sections 
     for other biosecurity programs.
       New section 1487 provides a special supplemental 
     authorization of such sums as are necessary for biosecurity 
     planning and response through 2006. Funds provided under 
     section 1487 may be used in accordance with any authority 
     available to the Secretary to carry out agricultural 
     research, education, and extension activities (including 
     competitive grants) necessary: (1) to reduce the 
     vulnerability of the United States food and agricultural 
     system to chemical or biological attack; (2) to continue 
     joint research initiatives between the Agricultural Research 
     Service, universities, and industry on counterbioterrorism 
     efforts; (3) to make competitive grants to universities and 
     qualified research institutions for research on 
     counterbioterrorism; and (4) to counter or otherwise respond 
     to chemical or biological attack.
       New section 1488 provides an authorization of $100 million 
     per year through 2006 for a competitive research facilities 
     construction grants program for land-grant colleges and 
     universities to enhance the security of agriculture in the 
     United States against threats posed by bioterrorism. To be 
     eligible to receive a grant, a land-grant institution must 
     have (1) demonstrated expertise in the area of animal and 
     plant diseases; (2) substantial animal and plant diagnostic 
     laboratories; and (3) well-established working relationships 
     with the agricultural industry and farm and commodity 
     organizations. In making grants, the Secretary shall give 
     priority to institutions with demonstrated expertise in (1) 
     animal and plant disease prevention; (2) pathogen and toxin 
     mitigation; (3) cereal disease resistance; (4) grain milling 
     and processing; (5) livestock production practices; (6) 
     vaccine development; (7) meat processing; (8) pathogen 
     detection and control; or (9) food safety. An institution may 
     not receive more than $10,000,00 of grants under this section 
     per fiscal year, and the Federal share of any construction 
     project shall not exceed 50 percent. Finally, subsection (b) 
     of section 723 of the bill includes a sense of Congress that 
     funding for ARS, APHIS, and other USDA agencies with 
     biosecurity responsibilities should be increased as necessary 
     to improve the capacity of the agencies to conduct research 
     and analysis of, and respond to, bioterrorism and animal and 
     plant diseases.(Section 723)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment deleting

[[Page H1958]]

     the Agriculture Infrastructure Security Fund and the 
     Agriculture Infrastructure Security Commission. The 
     Conference adopts the Senate program for agriculture 
     bioterrorism research facilities with an amendment 
     authorizing grants for expansion and security upgrades of 
     agriculture research facilities. (Section 7221)
       The Managers encourage the Secretary to give priority in 
     awarding grants for the expansion of biosecurity research 
     facilities to those universities or institutions which have 
     demonstrated expertise in the area of animal and plant 
     diseases; substantial animal and plant diagnostic 
     laboratories; and well-established working relationships with 
     the agriculture industry and farm and commodity 
     organizations.
     (77) Rural Electronic Commerce Extension Program
       The Senate amendment adds a new section 1670 to the FACT 
     Act providing an authorization for a Rural Electronic 
     Commerce Extension Program. The Secretary would be required 
     to establish within CSREES an Office of Rural Electronic 
     Commerce to carry out this program. The purposes of the 
     program are: (1) to expand and enhance electronic commerce 
     practices and technology to be used by small businesses and 
     microenterprises in rural areas; (2) disseminate information 
     and expertise through a cooperative extension service 
     clearinghouse in rural areas; (3) disseminate management, 
     scientific, engineering, and technical information to small 
     businesses in rural areas through the extension program; and 
     (4) use, when appropriate, the expertise, technology, and 
     capabilities of other organizations, including State and 
     local governments, Federal agencies, institutions of higher 
     education, nonprofit organizations, small businesses and 
     microenterprises that have experience in electronic commerce 
     practice and technology, and the development centers 
     established under this section. In carrying out this program, 
     the Secretary shall: (1) provide leadership, support, and 
     coordination for the program; (2) establish policies, 
     practices, and procedures to assist rural communities in the 
     adoption and use of electronic commerce techniques; (3) 
     identify and strengthen existing mechanisms designed to 
     assist rural areas in the adoption and use of electronic 
     commerce techniques; (4) provide grants to fund projects and 
     activities under the program; and (5) establish a 
     clearinghouse system for States, communities, and businesses 
     to obtain information on best practices, technology transfer, 
     training, education, adoption, and use of electronic commerce 
     in rural areas.
       The Secretary shall make grants to the North Central 
     Regional Center for Rural Development, the Northeast Regional 
     Center for Development, the Southern Rural Development 
     Center, and a development center in the Western Region, as 
     determined by the State Extension Program Directors in the 
     Western Region, to (1) assemble regional expertise, and 
     develop innovative education programs, that may be adapted 
     and refined by State extension programs; (2) train State-
     based cooperative extension agents to deliver rural 
     electronic commerce education programs; and establish 
     networks among universities, local governments, and 
     private industries to focus on regional economic issues.
       The Secretary also is authorized to make competitive grants 
     to cooperative extension programs at land-grant institutions, 
     or consortia of such institutions), to develop and facilitate 
     nationally innovative rural electronic commerce business 
     strategies, and to assist small businesses and 
     microenterprises in identifying, adapting, implementing, and 
     using electronic commerce business practices and 
     technologies. The provision also includes selection criteria 
     for grant awards. As a condition of funding, during the years 
     of funding under a grant the recipient must provide from non-
     Federal sources 50 percent (25 percent if the grant recipient 
     serves low-income or minority-owned businesses or 
     microenterprises of the estimated capital and annual 
     operating and maintenance costs of the extension program, and 
     after expiration of the grant funding period the recipient 
     must provide 100 percent of such costs from non-Federal 
     sources. Awards are limited to $900,000 for an individual 
     land-grant institution, either individually or as a member of 
     a consortium, and funds awarded to a consortium must be 
     shared equally among its members. The provision also 
     establishes an evaluation panel and process to evaluate 
     projects and activities funded under the program beginning 
     one year after grant award. The Secretary is required to 
     report to the Agriculture Committees on activities under this 
     section 2 years after the date of enactment.
       The program is authorized at $60,000,000 each fiscal year 
     through 2006, with $20,000,000 of that set aside for funding 
     the regional development centers. The Secretary is authorized 
     to use up to 2 percent of funds made available for 
     administrative costs to carry out this section. (Section 733)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment clarifying the Senate provision and expanding 
     the eligibility for grants to include colleges and 
     universities with agricultural or rural development programs. 
     (Section 6202)
       The Committee authorizes $60 million to establish a Rural 
     Electronic Commerce Extension Program within the Cooperative 
     State Research, Education, and Extension Service. Electronic 
     commerce represents an opportunity for small businesses and 
     micro enterprises in the domestic and international market, 
     but there is currently no mechanism available in rural areas 
     to enable individuals or organizations to both learn and take 
     advantage of innovative technologies and business practices. 
     The United States has a strong interest in ensuring that 
     small businesses and micro enterprises in rural areas 
     participate in electronic commerce as it will promote 
     productivity and economic growth throughout the United 
     States. The specific objectives of the program are: 1) expand 
     and enhance electronic commerce practices and technology to 
     be used by small businesses and micro enterprises in rural 
     areas; 2) disseminate information and expertise through a 
     cooperative extension service clearinghouse; 3) disseminate 
     management, scientific, and technical information to small 
     businesses and micro enterprises in rural areas through the 
     extension program, and 4) use, when appropriate, the 
     expertise, technology, and capabilities of other institutions 
     and organizations--examples being state and local 
     governments, Federal departments and agencies, institutions 
     of higher education, non-profit organizations, small 
     businesses and micro enterprises with previous experience in 
     this area, and regional development centers--to achieve the 
     stated objectives. The program will be competitive and merit-
     based, with grants being provided to cooperative extension 
     service programs at land-grant colleges and universities (or 
     consortia of land-grant colleges and universities) and to 
     colleges and universities with agriculture or rural 
     development programs. Using language in the legislation as 
     guidelines, the Cooperative State Research, Education, and 
     Extension Service shall establish appropriate criteria for 
     the submission, evaluation, and funding of applications for 
     grants to implement projects and activities for the program 
     and shall be responsible for evaluating, ranking, and 
     selecting grant applications.
     (78) Organic Agricultural Research and Extension Initiative
       The Senate amendment amends section 1672B of the FACT Act 
     to require the Secretary to consult with the National 
     Organics Standards Board as well as the REE Board in making 
     grants, and to add the following purposes for which grants 
     may be awarded:
       ``(4) determining desirable traits for organic commodities 
     using advanced genomics, field trials, and other methods;
       ``(5) pursuing classical and marker-assisted breeding for 
     publicly held varieties of crops and animals optimized for 
     organic systems;
       ``(6) identifying marketing and policy constraints on the 
     expansion of organic agriculture; and
       ``(7) conducting advanced on-farm research and development 
     that emphasizes observation of, experimentation with, and 
     innovation for working organic farms, including research 
     relating to production and to socioeconomic conditions.'' 
     (Section 736, 231, 232)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to include breeding, marketing, and policy 
     research as priority areas and include $3 million in new 
     mandatory funding from 2003 through 2007. (Section 7218)
       It is the intent of the Managers that these funds shall be 
     allocated for high priority aspects of organic agricultural 
     systems research, education, and extension. Priority concerns 
     encompass biological, physical, and social sciences 
     (including economics). The authorization of these funds shall 
     not preclude or preempt the allocation of funds for other 
     organic farming research, education, and extension programs 
     under any other competitive or special grants programs, 
     integrated activity, or formula funding. Rather, it is the 
     intent of the Managers that organic agriculture be recognized 
     as a legitimate priority of all Research, Education, and 
     Economics programs, and should be recognized accordingly in 
     appropriate USDA Research, Education and Extension program 
     plans and requests for proposals.
     (79) Grants for Youth Organizations
       The Senate amendment amends AREERA by adding a new section 
     410 providing $8 million in mandatory money from CCC (to 
     remain available until expended), and such sums as necessary 
     for 2002 through 2006, for the Secretary, acting through 
     CSREES, to make grants to the Girl Scouts, the Boy Scouts, 
     the National 4-H Council, and the National FFA organization 
     to establish pilot projects to expand the programs carried 
     out by the organizations in rural areas and small towns, and 
     for purposes of the 4-H Centennial under Pub. Law 107-19. 
     (Section 749)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007.
     (80) Senior Scientific Research Service
       The Senate amendment adds a new section to subtitle B of 
     AREERA establishing within USDA a Senior Scientist Research 
     Service of not more than 100 members. To be eligible to be 
     appointed to the Service by the Secretary, an individual must 
     (1) have conducted outstanding research in the field of 
     agriculture or forestry, (2) have a PhD, and meet OPM 
     qualification standards for a GS-15 position. The Secretary 
     may appoint and employ a member of the Service with regard to 
     Federal civil service laws regarding competitive

[[Page H1959]]

     service appointments, retention preferences, performance 
     appraisal and performance actions, pay rates and 
     classification, and adverse actions, except that a member of 
     the Service will have the same rights as a GS-15 appointee to 
     appeal to the Merits Systems Protection Board or the Office 
     of Special Counsel. The Secretary must develop a performance 
     appraisal system for the Service that provides for systematic 
     appraisals and encourages excellence. The Secretary shall set 
     compensation in a range between a GS-15 and an ES-I 
     appointment, with an exception to ES-I maximum for a rate 
     approved by the President by law. A member appointed to the 
     Service from a prior position at an institution of higher 
     education who retains the right to make contributions to that 
     institution's retirement system may request that the 
     Secretary contribute an amount not to exceed 10 percent of 
     his pay to that system, but such a member shall not earn 
     service credit under Federal law for time served in the 
     Service except for purposes crediting annual leave. Any 
     person involuntarily separated from the Service without cause 
     may be appointed by the Secretary to a career appointment at 
     the GS-15 level in the competitive service, unless that 
     person was not a career appointee in the civil service of 
     excepted service prior to his appointment to the Service, in 
     which case that person's appointment following separation 
     shall be to the excepted service for a term not to exceed 2 
     years. (Section 750B)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 7219)
     (81) Carryover
       The Senate amendment amends the Hatch Act to allow a State 
     agricultural institution to carryover the balance of any 
     fiscal year's allocation of funding remaining at the end of 
     the fiscal year to the next fiscal year, and if that balance 
     is not spent in the succeeding fiscal year, an amount 
     equivalent to that remaining shall be deducted from the 
     following fiscal year allocation to that State. (Section 751)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 7202)
     (82) Reporting of Technology Transfer Activities
       The Senate amendment amends the Hatch Act to require a 
     State to include in its plan of work a description of the 
     technology transfer activities conducted with respect to 
     federally-funded agricultural research. (Section 752)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
       The Managers expect the Secretary to require land-grant 
     universities to include descriptions of technology transfer 
     activities in any annual or other regular reports made to the 
     Secretary regarding research activities funded by the 
     Department.
     (83) Compliance with Multistate and Integration Requirements
       The Senate amendment amends the Hatch and Smith-Lever Act 
     requirements for multistate extension and integrated research 
     and extension activities to require:
       (1) that in order to receive Smith-Lever Act funding a 
     State must expend an amount equal to not less than 25 percent 
     of Smith-Lever Act funds received by the State in a prior 
     year on multistate activities, and in determining compliance 
     with that requirement the Secretary shall include all 
     cooperative extension funds expended by the State in the 
     prior year, including Federal, State, and local funds; and
       (2) that in order to receive Hatch and Smith-Lever Act 
     funding, a State must expend an amount equal to not less than 
     25 percent of Smith-Lever Act and Hatch Act of 1887 funds 
     received by the State in a prior year on integrated research 
     and extension activities, and in determining compliance with 
     that requirement the Secretary shall include all cooperative 
     research and extension funds expended by the State in the 
     prior year, including Federal, State, and local funds. This 
     amendment would be effective October 1, 2002. (Section 753)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (84) Authorization Percentages for Research and Extension 
         Formula Funds
       The Senate amendment subsection (a) amends section 1444 of 
     NARETPA to increase the authorization level for 1890 
     Institutions extension appropriations from not less than 6 
     percent of the amount appropriated annually for extension at 
     the 1862 Institutions under the Smith-Lever Act to not less 
     than 15 percent of the amount appropriated annually under the 
     Smith-Lever Act, and strikes obsolete language. Subsection 
     (b) amends section 1445 of NARETPA to increase the 
     authorization level for 1890 Institutions research 
     appropriations from not less than 15 percent of the amount 
     appropriated annually for research at the 1862 Institutions 
     under the Hatch Act of 1887 to not less than 25 percent of 
     the amount appropriated annually under the Hatch Act of 1887, 
     and strikes obsolete language. (Section 757)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 7203) It is the intent of the Managers that 
     increased formula funding for 1890 institutions be the 
     mechanism for reaching this increased ratio, rather than a 
     redistribution of the current limited formula funds.
     (85) Carryover
       The Senate amendment provides that in the same manner as 
     the amendment made by section 751 for 1862 Institutions, this 
     provision amends section 1445 of NARETPA to allow an 1890 
     Institution to carryover the balance of any fiscal year's 
     allocation of funding remaining at the end of the fiscal year 
     to the next fiscal year, and if that balance is not spent in 
     the succeeding fiscal year, an amount equivalent to that 
     remaining shall be deducted from the following fiscal year 
     allocation to that 1890 Institution. (Section 758)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 7204)
     (86) Reporting of Technology Transfer Activities
       The Senate amendment provides that in the same manner as 
     the amendment made by section 752 for 1862 Institutions, this 
     section amends section 1445 of NARETPA to require an 1890 
     Institution to include in its plan of work a description of 
     the technology transfer activities conducted with respect to 
     federally-funded agricultural research. (Section 759)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
       The Managers expect the Secretary to require land-grant 
     universities to include descriptions of technology transfer 
     activities in any annual or other regular reports made to the 
     Secretary regarding research activities funded by the 
     Department.
     (87) Priority-Setting Process
       The Senate amendment amends requirement in section 
     102(c)(1) of AREERA for land-grant colleges to obtain 
     stakeholder input to require that the process for obtaining 
     that input ``reflects transparency and opportunity for input 
     from producers of diverse agricultural crops and diverse 
     geographic and cultural communities.'' (Section 771)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (88) Termination of Certain Schedule A Appointments
       The Senate amendment provision provides for the termination 
     60 days after enactment of Schedule A, dual Federal-State 
     appointments, of employees working in agricultural extension 
     programs at 1862 Institutions, 1890 Institutions, and the 
     University of the District of Columbia. An individual whose 
     appointment is terminated but who remains employed in the 
     agricultural extension program will continue to be eligible, 
     to the same extent as before enactment of this provision, to 
     participate in the Federal Employee Health Benefits Program, 
     the Federal Employee Group Life Insurance Program, the Civil 
     Service Retirement System, the Federal Employee Retirement 
     System, and the Thrift Savings Plan, and will continue to 
     receive Federal civil service employment credit to the same 
     extent the individual was receiving that credit prior to 
     enactment of this provision, as long as the employing college 
     or university continues to fulfill the administrative and 
     financial responsibilities (including making agency 
     contributions) associated with providing those benefits. If 
     an individual changes employment from an agricultural 
     extension program at one institution to that in another, the 
     individual will continue to receive such benefits as long as 
     the second institution fulfills its administrative and 
     financial responsibilities and the second institution had 
     employed another person in the same position within 120 days 
     before the date of employment of the individual.(Section 772)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment changing the effective date to January 31, 2003, 
     and adding ``federal long-term care benefits'' to the list of 
     covered benefits. (Section 7220)
     (89) Risk Management Education for Beginning Farmers and 
         Ranchers
       The Senate amendment amends the risk management education 
     grant program in section 524(a)(3) of the Federal Crop 
     Insurance Act to give the Secretary authority to target 
     grants to programs specifically for beginning farmers and 
     ranchers, and makes a technical amendment to section 524(b) 
     of that Act. (Section 785)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (90) Joint Subcommittee on Aquaculture
       The Senate amendment extends authorization for National 
     Aquaculture Act of 1980 through 2006. (Section 786)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the authorization through 2007. 
     (Section 7139)


            Subtitle F--New Authorities (Sections 791-798D)

     (91) Definitions
       The Senate amendment defines ``Department'' and 
     ``Secretary'' for purposes of the subtitle. (Section 791)
       The House bill contains no comparable provision.

[[Page H1960]]

       The Conference substitute adopts the Senate provision. 
     (Section 7401)
     (92) Regulatory and Inspection Research
       The Senate amendment authorizes the Secretary to use a 
     public or private source, and requires the Secretary to use 
     the most practicable source to provide timely cost-effective 
     means of providing the research, to meet the urgent applied 
     research needs of an inspection or regulatory agency of the 
     Department (defined as APHIS, FSIS, GIPSA, and AMS) in 
     carrying out agricultural marketing programs; programs to 
     protect the animal and plant resources of the United States; 
     and education programs or special studies to improve the 
     safety of the food supply of the United States. Provision 
     also requires the Secretary to establish guidelines to 
     prevent any conflict of interest that may arise if an 
     inspection or regulatory agency obtains research from a 
     Federal agency the work or technology transfer efforts of 
     which are funded in part by an industry subject to the 
     jurisdiction of the inspection or regulatory agency. (Section 
     792)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (93) Emergency Research Transfer Authority
       The Senate amendment, in addition to any transfer authority 
     she may have, authorizes the Secretary to transfer up to 2 
     percent of any appropriation account of the Department for 
     agricultural research, extension, marketing, animal and plant 
     health, nutrition, food safety, nutrition education, or 
     forestry programs to any other appropriation account of the 
     Department for emergency research, extension, or education 
     activities needed to address imminent threats to animal and 
     plant health, food safety, or human nutrition, including 
     bioterrorism. Such transfers are limited by three conditions: 
     (1) the Secretary must determine the need is so imminent that 
     the need will not be timely met by annual, supplemental, or 
     emergency appropriations; (2) the aggregate total of such 
     transfers cannot exceed $5 million per fiscal year; and (3) 
     transfers must be approved by  OMB. (Section 793)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (94) Review of Agricultural Research Service
       The Senate amendment requires the Secretary to conduct a 
     review of the purpose, efficiency, effectiveness, and impact 
     on agricultural research of ARS, using persons outside the 
     Department, with a report to be submitted to the Agriculture 
     Committees by September 30, 2004; and provides that Secretary 
     shall use no more than 0.1 percent of appropriations made 
     available to ARS in fiscal years 2002 through 2004 to carry 
     out the study. (Section 794)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment creating a task force appointed by the Secretary 
     to conduct a review of ARS and examining the merits of 
     establishing National Institutes focused on disciplines 
     important to the progress of food and agriculture sciences. 
     The report is to be submitted one year after enactment of 
     this legislation. (Section 7404)
       The sciences related to plant biology and agriculture have 
     contributed greatly to human welfare. The gains in the next 
     decades have the potential to be astonishing. The challenge 
     is to establish appropriate mechanisms, with adequate 
     funding, to ensure that the United States is home to highest 
     quality research and is able to maximize its benefits to its 
     economy. In 1999, food and agriculture accounted for 16.4% of 
     the GDP (or $1.5 trillion) yet attracted less than two 
     percent of the federal research budget. In real terms, the 
     U.S. now spends less on food and agricultural research than 
     was spent in 1978.
       The Managers believe a new model for plant and agricultural 
     research might be patterned after the highly successful 
     biomedical research conducted by the National Institutes of 
     Health (NIH). The mechanisms employed by NIH and the National 
     Science Foundation (NSF) have advanced science of the highest 
     quality, attracted the best young scientists to careers in 
     research and teaching, and provided a stream of discoveries 
     that has been rapid and highly beneficial to society. The 
     Managers intend that any new research institute would 
     supplement, not supplant, the successful programs of USDA and 
     other existing federal research programs. As such, the 
     conferees urge the Secretary to place high priority in 
     establishing a task force of members, the majority of which 
     should be from the private sector, including institutions of 
     higher education, that have extensive background and 
     preeminence in field of plant and agricultural sciences 
     research. In addition, the Secretary is urged to designate a 
     Chairperson that has significant leadership experience in 
     educational and research institutions and in depth knowledge 
     of the research enterprises of the United States in leading 
     the evaluation of the merits of establishing a National 
     Institutes for Plant and Agricultural Sciences and provide 
     recommendations to the Committees. In addition, the task 
     force is charged with conducting a separate review of the 
     purpose, efficiency, effectiveness, and impact of 
     agricultural research conducted by the Agricultural Research 
     Service. Together, these two separate reports should provide 
     a roadmap for the future of the federal government concerning 
     plant and agriculture research and the potential benefits 
     that could be realized.
     (95) Technology Transfer for Rural Development
       The Senate amendment directs the Secretary, through RBS and 
     ARS, to establish a program to promote USDA tech transfer 
     opportunities to rural businesses and residents through a 
     website featuring information on such technologies, an annual 
     joint program for State economic development directors and 
     Department rural development directors regarding such 
     opportunities, and programs at each ARS lab at least 
     biennially, with participation of other Federal labs as 
     appropriate. Funding for the program is to come from amounts 
     available to ARS and amounts available to RBS for salaries 
     and expenses. (Section 795)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
       The Managers expect the Rural Business-Cooperative Service 
     to promote to rural businesses and residents the availability 
     of technology transfer opportunities with the Agricultural 
     Research Service (ARS), research facilities of the Forest 
     Service, and other research activities of the Department. The 
     Managers also expect ARS to continue its efforts to promote 
     and publicize technology transfer opportunities available to 
     the private sector, and especially those opportunities that 
     would provide employment in rural areas.
     (96) Beginning Farmer and Rancher Development Program
       The Senate amendment provides $15 million in mandatory 
     money in each of fiscal years 2002 through 2006 for the 
     Secretary to carry out a beginning farmer and rancher 
     development program to provide training, education, outreach, 
     and technical assistance initiatives for beginning farmers or 
     ranchers. A ``beginning farmer or rancher'' is defined as a 
     person that has not operated a farm or ranch, or operated one 
     for less than 10 years, and meeting such other criteria as 
     the Secretary prescribes.
       The program has three parts:
       (1) The Secretary may make competitive grants to new and 
     established local and regional training, education, outreach, 
     and technical assistance initiatives for beginning farmers or 
     ranchers, including programs and services (as appropriate) 
     relating to: (A) mentoring, apprenticeships, and internships; 
     (B) resources and referral; (C) assisting beginning farmers 
     or ranchers in acquiring land from retiring farmers and 
     ranchers; (D) innovative farm and ranch transfer strategies; 
     (E) entrepreneurship and business training; (F) model land 
     leasing contracts; (G) financial management training; (H) 
     whole farm planning; (I) conservation assistance; (J) risk 
     management education; (K) diversification and marketing 
     strategies; (L) curriculum development; (M) understanding the 
     impact of concentration and globalization; (N) basic 
     livestock and crop farming practices; (O) the acquisition and 
     management of agricultural credit; (P) environmental 
     compliance; (Q) information processing; and (R) other similar 
     subject areas. Entities eligible to receive grants include 
     collaborative State, local, tribal or regionally-based 
     networks or partnerships of private or public entities 
     including State cooperative extension services, Federal, 
     State, and tribal agencies, community-based and 
     nongovernmental organizations, colleges and universities 
     (including community colleges) and others as determined by 
     the Secretary. Grants are for 3-years, are subject to a 25% 
     matching requirement, and not less than 25 percent of funds 
     used to carry out the grant program must be set aside to 
     support programs that address needs of limited resource 
     beginning farmers and ranchers, socially disadvantaged 
     beginning farmers and ranchers, and farmworkers desiring to 
     become farmers or ranchers.
       (2) The Secretary is authorized to establish teams to 
     develop curricula and conduct educational programs and 
     workshops for beginning farmers and ranchers tailored to 
     diverse crop and regional areas. In establishing such teams, 
     the Secretary can use the services of specialists in 
     beginning farmer and rancher training and USDA employees who 
     can offer program expertise. The Secretary is authorized to 
     enter into cooperative agreements with the same entities that 
     are eligible for the grants to carry out team programs.
       (3) The Secretary is required to establish an online 
     clearinghouse to make curricula, training materials, and 
     online courses available for beginning farmers and ranchers.
       The Secretary is required to obtain stakeholder input from 
     beginning farmers and ranchers; national, state, tribal, and 
     local organizations or other persons with expertise in 
     operating beginning farmer and rancher programs; and the 
     Advisory Committee on Beginning Farmers and Ranchers.
       The provision allows for participation of non-beginning 
     farmers and ranchers in these programs to the extent that the 
     Secretary determines it will not detract from the primary 
     purpose of beginning farmer and rancher education.
       In addition to the mandatory funding provided, the 
     Secretary is authorized to collect and use fees for the 
     delivery of programs or workshops by beginning farmer and 
     rancher

[[Page H1961]]

     education teams or by the online clearinghouse, and the 
     Secretary is authorized to receive contributions under 
     cooperative agreements for program delivery by education 
     teams.
       Four percent of funds used for grants may be used by the 
     Secretary for administrative costs. Funds provided remain 
     available for obligation for two fiscal years. (Section 796)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment making the 4% set-aside for administrative costs 
     apply only to competitive grants appropriations and making 
     the mandatory funding subject to appropriations. (Section 
     7405)
     (97) Sense of Congress Regarding Doubling of Funding for 
         Agricultural Research
       The Senate amendment expresses sense of Congress that food 
     and agricultural research funding should be doubled over next 
     five years. (Section 797)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 7406)
     (98) Rural Policy Research
       The Senate amendment provides $15 million in mandatory 
     money in each of fiscal years 2002 through 2006 for the 
     Secretary to make competitive research grants for applied and 
     outcome oriented research and policy research and analysis of 
     rural issues relating to: (1) rural sociology; (2) effects of 
     demographic change, including aging population, outmigration, 
     and labor resources; (3) needs of groups of rural citizens, 
     including senior citizens, families, youth, children, and 
     socially disadvantaged individuals; (4) rural community 
     development; (5) rural infrastructure, including water and 
     waste, community facilities, telecommunications, electricity, 
     and high-speed broadband services; (6) rural business 
     development, including credit, venture capital, cooperatives, 
     value-added enterprises, new and alternative markets, farm 
     and rural enterprise formation, and entrepreneurship; (7) 
     farm management, including strategic planning, business and 
     marketing opportunities, risk management, natural resources 
     and environmental management, organic and sustainable farming 
     systems, and intergenerational transfer strategies; (8) rural 
     education and extension programs, including methods of 
     delivery, availability of resources, and use of distance 
     learning; and (9) rural health, including mental health, on-
     farm safety, and food safety.
       The Secretary must seek stakeholder input in making grants, 
     and ensure that grants will provide high-quality research of 
     use to public policymakers and private entities in making 
     decisions that affect development in rural areas.
       Eligible grantees include individuals, colleges and 
     universities, a State cooperative institution, a community 
     college, a nonprofit organization, institution, or 
     association, a business association, or a regional 
     partnership of public and private entities.
       Grant terms may be up to 5 years. The Secretary may 
     establish a matching requirement, but a grant to a business 
     association is subject to a 100 percent match. Up to four 
     percent of funds may be used by the Secretary for 
     administrative costs. Funds provided remain available for two 
     fiscal years. (Section 798)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (99) Priority for Farmers and Ranchers Participating in 
         Conservation Programs
       The Senate amendment requires the Secretary, in carrying 
     out new on-farm research or extension programs or projects 
     authorized by this bill, amendments made by this bill, and 
     any later enacted law, to give priority to carrying out such 
     programs or projects using farms and ranchers of farmers and 
     ranchers that participate in Federal agricultural 
     conservation programs. (Section 798A)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (100) Organic Production and Market Data Initiatives
       The Senate amendment requires the Secretary to ensure that 
     segregated data on the production and marketing of organic 
     agricultural products is included in the ongoing baseline of 
     data collection regarding agricultural production and 
     marketing. (Section 798B)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 7407)
     (101) Organically Produced Product Research and Education
       The Senate amendment requires the Secretary, in 
     consultation with the Advisory Committee on Small Farms, to 
     submit a report to the Agriculture Committees by December 1, 
     2004 on:
       (1) the impact on small farms of the implementation of the 
     national organic program; and (2) the production and 
     marketing costs to producers and handlers associated with 
     transitioning to organic production. (Section 798C)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (102) International Organic Research Collaboration
       The Senate amendment requires the Agricultural Research 
     Service and the National Agricultural Library to facilitate 
     access by research and extension professionals to organic 
     research conducted outside the United States. (Section 798D)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 7408)
     (103) Report on Producers and Handlers of Organic 
         Agricultural Products
       The Senate amendment provides for a report to be submitted 
     not later than 1 year after funds are made available to carry 
     out this section. (Section 798E)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Section 7409)

                    Title VIII--Forestry Initiatives

     (1) Repeal of Forestry Incentives Program (FIP) and 
         Stewardship Incentive Program (SIP)
       The House bill repeals the Forestry Incentives Program and 
     the Stewardship Incentives Program. (Sec. 801)
       The Senate amendment reauthorizes the Forestry Incentives 
     Program through 2006. The Senate amendment contains no 
     comparable provision regarding the Stewardship Incentives 
     Program. (Sec. 804)
       The Conference substitute adopts the House provision. (Sec. 
     801)
     (2) Establishment of New Cost Share Assistance Program
       The House bill amends the Cooperative Forestry Assistance 
     Act of 1978 by inserting a new section 4. (Sec. 802)
       The Senate amendment amends the Cooperative Forestry 
     Assistance Act of 1978 by inserting a new program after 
     section 6. (Sec. 806)
       The Conference substitute adopts the House provision. (Sec. 
     802)
     (3) Findings
       The House bill sets forth Congressional findings with 
     respect to dependence on private non-industrial forest lands, 
     demand for assistance from owners of non-industrial private 
     forest land, environmental benefits of good stewardship of 
     forest land, economic benefits resulting from non-industrial 
     private forest lands, wildfire threats, and development 
     pressure faced by owners of non-industrial private forest 
     land. (Sec. 802(a))
       The Senate amendment sets forth Congressional findings with 
     respect to dependence on private non-industrial forest lands, 
     demand for assistance from owners of non-industrial private 
     forest land, environmental benefits of good stewardship of 
     forest land, economic benefits resulting from non-industrial 
     private forest lands, wildfire threats, development pressure 
     faced by owners of non-industrial private forest land, 
     federal and state cooperation in forest fire prevention, 
     difficulty for owners of non-industrial private forest land 
     to invest in the management of long-rotation forest stands, 
     and the benefits of comprehensive, multi-resource planning 
     assistance to landowners. (Sec. 806(a)(1))
       The Conference substitute deletes both provisions.
     (4) Purpose
       The House bill describes the purpose of the new section as: 
     (1) strengthening the commitment of the Secretary to 
     sustainable forest management, and (2) establishing a 
     coordinated and cooperative federal, state and local 
     sustainable forestry program for non-industrial private 
     forest land. (Sec. 802(b))
       The Senate amendment describes the purpose of the new 
     section as: (1) strengthening the commitment of the Secretary 
     to sustainable forest management, and (2) establishing a 
     coordinated and cooperative federal, state and local 
     sustainable forestry program for non-industrial private 
     forest land. (Sec. 806(a)(2))
       The Conference substitute adopts the Senate provision. 
     (Sec. 806(a)(2))
     (5) Forest Land Enhancement Program
       The House bill establishes a Forest Land Enhancement 
     Program by inserting a new section 4 in the Cooperative 
     Forestry Assistance Act of 1978. (Sec. 802(c))
       The Senate amendment establishes a Sustainable Forest 
     Management Program by inserting a new section 6A in the 
     Cooperative Forestry Assistance Act of 1978. (Sec. 806(b))
       The Conference substitute adopts the House provision. (Sec. 
     802 (c))
     (6) Definitions
       The House bill defines: (1) non-industrial private 
     forestland, (2) owner, (3) Secretary, and (4) state forester. 
     (Sec. 802)
       The Senate amendment defines: (1) committee, (2) Indian 
     tribe, (3) program, (4) non-industrial private forestland, 
     (5) owner, and (6) state forester. (Sec. 806)
       The Conference substitute adopts the House provision with 
     amendment to include definitions for the terms Committee and 
     Indian Tribe.
     (7) Establishment
       The House bill (1) directs the Secretary to establish a 
     Forest Land Enhancement Program (FLEP) for the purposes of 
     providing financial, technical, educational, and related 
     assistance to State Foresters to assist private landowners in 
     actively managing their land through the utilization of 
     management expertise, financial assistance and educational 
     programs; (2) directs the Secretary to administer the program 
     through NRCS; (3) directs the Secretary to implement the 
     program in coordination with the State Foresters. (Sec. 802)

[[Page H1962]]

       The Senate amendment (1) directs the Secretary to establish 
     a Sustainable Forestry Management Program for the purposes of 
     providing financial assistance to State foresters, and 
     encouraging the long-term sustainability of non-industrial 
     private forestland in U.S. by assisting owners in actively 
     managing land and related resources through the use of State, 
     Federal, and private sector resource management expertise, 
     financial assistance, and educational programs; (2) directs 
     the Secretary to administer the program through the State 
     Foresters, in coordination with the Committees, and in 
     consultation with Federal State, and local natural resource 
     management agencies, institutions of higher education and a 
     broad range of private sector interests. (Sec. 806)
       The Conference substitute the Senate provision. (Sec. 806)
     (8) Program Objectives
       The House bill directs the Secretary to target resources to 
     achieve a list of objectives including: (1) making 
     investments in practices to establish, restore, protect, 
     manage, maintain and enhance the health and productivity of 
     non-industrial private forest land, (2) ensuring that 
     afforestation, reforestation, improvement of poorly stocked 
     stands, timber stand improvement, practices necessary to 
     improve seedling growth and survival, and growth enhancement 
     practices occur where needed, (3) reducing the risks and 
     helping to restore, recover and mitigate damage caused by 
     fire, insects, invasive species, disease, and weather, (4) 
     increasing and enhancing carbon sequestration, (5) enhancing 
     implementation of agro forestry practices, and (6) 
     maintaining and enhancing the forest land base and leveraging 
     State and local financial and technical assistance. (Sec. 
     802)
       The Senate amendment directs the Secretary to allocate the 
     resources among the states (in accordance with the 
     distribution formula described below) to encourage: (1) the 
     investment in practices to establish, restore, protect, 
     manage, maintain, and enhance the health and productivity of 
     non-industrial private forest land, and (2) the occurrence of 
     afforestation, reforestation, improvement of poorly stocked 
     stands, practices necessary to improve seedling growth and 
     survival, and growth enhancement practices as needed to 
     enhance and sustain the long-term productivity of timber and 
     non-timber forest resources to meet public demand for forest 
     resources, provide environmental benefits, protect riparian 
     buffers and wetlands, maintain and enhance fish and wildlife 
     habitat, enhance soil, air and water quality, reduce soil 
     erosion and maintain soil quality, maintain and enhance the 
     forest land base, reduce the threat of catastrophic 
     wildfires, and preserve aesthetic quality and opportunities 
     for outdoor recreation. (Sec. 806)
       The Conference substitute adopts the House provision with 
     minor amendments.
     (9) Eligibility
       The House bill makes an owner of non-industrial private 
     forest land eligible for cost-share assistance if the owner: 
     (1) agrees to develop and implement a forest plan developed 
     in coordination with and/or approved by the State forester, 
     state official, or private sector program in consultation 
     with the State Forester, (2) agrees to implement the plan for 
     a period of 10 years unless the State Forester approves a 
     modification to such plan, and (3) meets acreage restrictions 
     determined by the State Forester in conjunction with the 
     State Forest Stewardship Coordinating Committee. (Sec. 802)
       The Senate amendment (a) makes an owner of non-industrial 
     private forest land eligible for cost-share assistance if the 
     owner: (1) develops a management plan that addresses site-
     specific activities and practices and is approved by the 
     State Forester, (2) agrees to implement the plan for at least 
     10 years unless the State Forester approves a modification to 
     the management plan, and (3) owns not more than 1,000 acres; 
     and (b) creates an exception to the above acreage restriction 
     requirement for owners with more than 1,000 acres but less 
     than 5,000 acres where the Secretary, in consultation with 
     the State forester, determines that significant public 
     benefits will accrue as a result of the owner's 
     participation. (Sec. 806)
       The Conference substitute adopts the House provision with 
     minor changes.
     (10) State Priorities
       The House bill allows the Secretary to develop State 
     priorities for cost-share assistance in consultation with the 
     State Forester and the State Forest Stewardship Coordinating 
     Committee. (Sec. 802)
       The Senate amendment (1) directs the State Forester and the 
     Committee of the State to develop and submit to the Secretary 
     a 5-year plan that describes the funding priorities of the 
     state and makes this requirement a condition of receipt of 
     funding under the Sustainable Forest Management program; (2) 
     requires the state priority plan to include documentation of 
     public participation in the development of the plan; (3) 
     requires the Secretary to ensure, to the maximum extent 
     practicable, that the need for expanded technical assistance 
     programs for owners is met in the annual funding priorities 
     of each state. (Sec. 806)
       The Conference substitute adopts the Senate provision with 
     minor changes.
     (11) Development of Plan
       The House bill makes a landowner eligible for cost-share 
     assistance for the development of a forest management plan 
     required to participate in the FLEP. (Sec. 802)
       The Senate amendment requires a landowner to submit a plan 
     to the State Forester that is prepared by a professional 
     resource manager, identifies and describes projects and 
     activities to protect certain environmental qualities in a 
     manner that is compatible with the objectives of the owner, 
     addresses criteria established by the State and Committee, 
     and applies to the portion of the land on which any project 
     or activity funded under the program will be carried out. In 
     addition, the landowner must also agree that all projects and 
     activities conducted on the land will be consistent with the 
     management plan.(Sec. 806)
       The Conference substitute adopts the Senate provision with 
     minor changes. (Sec. 806)
     (12) Approved Activities
       The House bill directs the Secretary, in consultation with 
     the State Forester and State Forest Stewardship Coordinating 
     Committee, to develop a list of approved forest activities 
     and practices that will be eligible for cost-share assistance 
     under the FLEP within each state. In developing this list, 
     the Secretary is required to attempt to achieve the 
     establishment, restoration, management, maintenance and 
     enhancement of forests and trees for the following: 
     sustainable growth and management for timber production, 
     water quality, energy conservation, habitat, invasive species 
     control, hazardous fuels reduction, development of forest or 
     stand management plans and other activities approved by the 
     Secretary. (Sec. 802)
       The Senate amendment requires the Secretary, in 
     consultation with the State forester and appropriate 
     committee, to develop a list of approved forest activities 
     and practices eligible for cost-share assistance. Approved 
     activities may include: (1) the establishment, management, 
     maintenance and restoration of forests for shelterbelts, 
     windbreaks, aesthetic quality and other conservation 
     purposes, (2) sustainable growth and management for timber 
     production, (3) the protection of water quality, (4) the 
     preservation, restoration or development of habitat, (5) 
     invasive species control, (6) the conduct of other management 
     activities such as hazardous fuels reduction that reduce the 
     risks to forests posed by fire, (7) the development of 
     management plans, (8) the acquisition of permanent 
     conservation easements, and (9) the conduct of other 
     activities approved by the Secretary. (Sec. 806)
       The Conference substitute adopts the Senate provision with 
     minor changes including an amendment to strike the 
     acquisition of permanent easements as an eligible activity.
     (13) Reimbursement of Eligible Activities
       The House bill (1) directs the Secretary to share the cost 
     of implementing the approved activities that the Secretary 
     determines are appropriate to carry out the Forest Land 
     Enhancement Program; (2) directs the Secretary to determine 
     the appropriate reimbursement rate for cost-share payments 
     and the schedule for making such payments; (3) prohibits the 
     Secretary from making cost-share payments in an amount that 
     exceeds 75% of the total cost, or a lower percentage as 
     determined by the State forester; (4) directs the Secretary 
     to determine the maximum payment made to any one owner. (Sec. 
     802)
       The Senate amendment allows the Secretary to provide cost-
     share assistance to an owner to develop a sustainable forest 
     management plan.
       The Senate amendment prevents an owner from receiving any 
     cost-share assistance for management of non-industrial 
     private forest land if the owner receives assistance for that 
     land under the FIP, SIP or any conservation program 
     administered by the Secretary.
       The Senate amendment directs the Secretary, in consultation 
     with the State forester, to determine the rate and timing of 
     cost-share payments.
       The Senate amendment limits the amount of a cost-share 
     payment to the lesser of: 75% of the total cost of 
     implementing the project or activity or such lesser 
     percentage of the total cost of implementing the project or 
     activity as is determined by the appropriate State forester; 
     and requires the Secretary to determine the maximum aggregate 
     amount of cost-share payments that each owner may receive. 
     (Sec. 806)
       The Conference substitute adopts the House provision. (Sec. 
     802)
     (14) Recapture
       The House bill directs the Secretary to establish and 
     implement a mechanism to recapture payments made to an owner 
     in the event that the owner fails to implement any approved 
     activity for which the owner received cost-share payments 
     under the Forest Land Enhancement Program. (Sec. 802)
       The Senate amendment directs the Secretary to establish a 
     procedure to recapture cost-share payments in any case in 
     which the recipient fails to implement a project or activity 
     in accordance with the management plan or comply with any 
     requirement of Sustainable Forest Management Program. (Sec. 
     806)
       The Conference substitute adopts the House provision. (Sec. 
     802)
     (15) Distribution
       The House bill directs the Secretary to consider the 
     following in distributing funds to the states under the 
     Forest Land Enhancement program: the number of owners 
     eligible in each state; demand for timber; demand for agro 
     forestry; need to improve forest health, etc. (Sec 802)

[[Page H1963]]

       The Senate amendment directs the Secretary, acting through 
     the State Foresters and considering the program objectives 
     (described above), to develop a nationwide funding formula 
     for the Sustainable Forest Management program. In developing 
     the formula, the Secretary is required to assess the public 
     benefits that would result from the distribution as well as 
     the following factors: the total acreage of non-industrial 
     private forest land in each state, the potential productivity 
     of that land, the number of owners eligible for cost-sharing 
     in each state, the opportunities to enhance non-timber 
     resources on that land, the anticipated demand for timber and 
     non-timber resources, the need to improve forest health, the 
     need and demand for agro forestry practices in each state, 
     the need to maintain and enhance the forest land base, and 
     the need for afforestation, reforestation and timber stand 
     improvement. (Sec. 806)
       The Conference substitute adopts the Senate provision with 
     minor changes.
     (16) Availability of Funds
       The House bill makes $200 million available from the CCC 
     for carrying out the Forest Land Enhancement program from 
     October 1, 2001 to September 30, 2011. (Sec. 802).
       The Senate amendment makes $48 million available from the 
     Treasury during fiscal years 2002 through 2005 to fund the 
     Sustainable Forest Management Program. (Sec. 806).
       The Conference substitute provides for $100 million from 
     the CCC to carry out the program.
     (17) Conforming Amendment
       The House bill amends section 246(b)(2) of Department of 
     Agriculture Reorganization Act of 1994 by striking ``forestry 
     incentive program'' and inserting ``Forest Land Enhancement 
     Program''. (Sec. 802(d))
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. (Sec. 
     802(d))
     (18) Reports
       The Senate amendment (1) directs the states to submit an 
     interim report to the Secretary not later than 2\1/2\ years 
     after the date on which funds are made available to implement 
     a state Sustainable Forest Management priority plan. The 
     report must describe the status of projects and activities 
     being funded under the plan; and (2) requires states to 
     submit a final report no later than 5 years after the date on 
     which funds are made available to implement a state priority 
     plan. The report must describe the status of all projects and 
     activities funded under the plan as of that date. (Sec. 806)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     changes to require one report one year prior to 
     reauthorization of the program.
     (19) Renewable Resources Extension Activities (Sustainable 
         Forestry Outreach Initiative)
       The House bill (1) reauthorizes the RREA through 2011 and 
     amends the amount of authorization from $ 15 million to $ 30 
     million; and (2) amends the RREA by inserting a new 
     Sustainable Forestry Outreach Initiative designed to educate 
     landowners on the value and benefits of practicing 
     sustainable forestry, and to educate landowners about the 
     variety of programs available to them. (Sec. 803)
       The Senate amendment (1) reauthorizes the RREA through 2006 
     and amends the amount of the authorization from $ 15 million 
     to $30 million per year; (2) amends the RREA by inserting a 
     new Sustainable Forestry Outreach Initiative designed to 
     educate landowners on the value and benefits of practicing 
     sustainable forestry, and to educate landowners about the 
     variety of programs available to them. (Sec. 803)
       The Conference substitute adopts the Senate provision. 
     (Sec. 803)
     (20) Enhanced Community Fire Protection
       The House bill amends the Cooperative Forestry Assistance 
     Act of 1978 by adding a new Enhanced Community Fire 
     Protection program. (Sec. 804)
       The Senate amendment amends the Cooperative Forestry 
     Assistance Act of 1978 by adding an Enhanced Community Fire 
     Protection section. (Sec. 811)
       The Conference substitute adopts the House provision. (Sec. 
     804)
     (21) Findings
       The House bill contains findings of Congress with respect 
     to severity and intensity of wildland fires, 2000 fire 
     season, threat of wildfires to communities in the wildland-
     urban interface, National Fire Plan, authority for addressing 
     the wildfire issue on private lands and federal interest in 
     enhanced community protection from wildfire. (Sec.804 (a))
       The Senate amendment contains findings of Congress with 
     respect to severity and intensity of wildland fires, 2000 
     fire season, threat of wildfires to communities in the 
     wildland-urban interface, National Fire Plan, authority for 
     addressing the wildfire issue on private lands and federal 
     interest in enhanced community protection from wildfire; and 
     adds additional finding with respect to forest wetlands. 
     (Sec. 811(a))
       The Conference substitute adopts the House provision with 
     minor changes. (Sec. 804(a))
     (22) Enhanced Protection
       The House bill adds a new section 10A to the Cooperative 
     Forestry Assistance Act of 1978. (Sec. 804(b))
       The Senate amendment adds a new section 10A to the 
     Cooperative Forestry Assistance Act of 1978. (Sec. 811(b))
       The Conference substitute adopts the House provision. (Sec. 
     804(b))
     (23) Cooperative Management Relating to Wildfire Threats
       The House bill allows the Secretary to cooperate with State 
     foresters and equivalent state officials to: (1) prevent and 
     control wildfire, (2) protect communities from wildfire 
     threats, (3) enhance the growth and maintenance of trees and 
     forests, and (4) ensure the continued production of all 
     forest resources. (Sec. 804)
       The Senate amendment allows the Secretary to cooperate with 
     State foresters and equivalent state officials to: (1) 
     prevent, control, suppress and assist in the prescribed use 
     of fires, (2) protect communities from wildfire threats, (3) 
     enhance the growth and maintenance of trees and forests, and 
     (4) ensure the continued production of all forest resources. 
     (Sec. 811)
       The Conference substitute adopts the House provision. (Sec. 
     804)
     (24) Community and Private Land Fire Assistance Program
       The House bill (1) directs the Secretary to establish a 
     Community and Private Land Fire Assistance Program to be 
     administered by the Forest Service and implemented through 
     the State forester or an equivalent state official; and (2) 
     allows the Secretary to undertake the following activities on 
     both federal and non-federal lands: fuel hazard mitigation 
     and prevention, invasive species management, multi-resource 
     wildfire planning, community protection planning, community 
     and landowner education, market development and expansion, 
     improved wood utilization, and special restoration projects. 
     (Sec. 804)
       The Senate amendment (1) directs the Secretary to establish 
     a Community and Private Land Fire Assistance Program to be 
     administered by the Secretary and, with respect to non-
     federal lands, carried out through the State forester or 
     equivalent state official; allows the Secretary to undertake 
     the following activities on both federal and non-federal 
     lands: fuel hazard mitigation and prevention, invasive 
     species management, multi-resource wildfire planning, 
     community protection planning, community and landowner 
     education, market development and expansion, improved wood 
     utilization, and special restoration projects; and (2) 
     directs the Secretary to give priority to contracts with 
     local persons or entities in carrying out the program. (Sec. 
     811)
       The Conference substitute adopts the House provision with 
     minor changes. (Sec. 804)
     (25) Authorization Of Appropriations
       The House bill authorizes $35 million in appropriations for 
     each fiscal year during 2002 through 2011 for the Enhanced 
     Community Fire Protection program. (Sec. 804)
       The Senate amendment authorizes $35 million in 
     appropriations for each fiscal year during 2002 through 2006 
     for the Enhanced Community Fire Protection program (Sec. 
     811).
       The Conference substitute adopts House provision. (Sec. 
     804)
     (26) International Forestry Program/Office
       The House bill reauthorizes the International Forestry 
     Program through 2011. (Sec. 805)
       The Senate amendment reauthorizes the International 
     Forestry Office through 2006. (Sec. 801)
       The Conference substitute adopts the Senate provision. 
     (Sec. 801)
     (27) Long-term Forest Stewardship Contracts
       The Senate amendment (1) lists the findings of Congress 
     with respect to wildfire damage, risk to communities from 
     wildfire, accumulation of heavy forest fuel loads, 
     modification of forest fuel load conditions, hazardous fuels 
     as a renewable resource, and the need for the United States 
     to invest in technologies that promote economic and 
     entrepreneurial opportunities in processing forest products 
     removed through hazardous fuel reduction activities (Sec. 
     809(a)); and (2) defines: (a) biomass-to-energy facility, (b) 
     eligible community, (c) forest biomass, (d) hazardous fuel, 
     (e) Indian tribe, (f) National Fire Plan, (g) person, and (h) 
     Secretary. (Sec. 809(b))
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (28) Annual Assessment of Treatment Acreage
       The House bill directs the Secretary to submit to Congress 
     an assessment of the number of acres of forested National 
     Forest System lands recommended to be treated using 
     stewardship contracts during the next fiscal year no later 
     than March 1 of each of fiscal years 2002 through 2006. 
     This assessment is to be based on the treatment schedules 
     contained in the report entitled ``Protecting People and 
     Sustaining Resources in Fire-Adapted Ecosystems'' and 
     dated October 13, 2000; and requires the assessment to 
     identify the acreage by condition class, type of treatment 
     and treatment year to achieve the restoration goals 
     outlined in the report. (Sec. 806(a))
       The Senate amendment (1) directs the Secretary to submit to 
     Congress an assessment of the number of forested National 
     Forest System acres recommended for treatment during the next 
     fiscal year using stewardship contracts no later than March 1 
     of each of

[[Page H1964]]

     fiscal years 2002 through 2006. This assessment is to be 
     based on the treatment schedules contained in the report 
     ``Protecting People and Sustaining Resources in Fire-Adapted 
     Ecosystems'' and dated October 13, 2000; (2) requires the 
     assessment to identify the acreage by condition class, type 
     of treatment, and treatment year; (3) in addition, the 
     assessment is to give priority to condition class 3 acreage, 
     provide information relating to the type of material and 
     estimated quantity and range of sizes of material, and 
     describe land allocation categories in which the contract 
     authorities will be used.(Sec. 809(d)(1))
       The Conference substitute did not adopt this provision.
     (29) Funding Recommendation
       The House bill directs the Secretary to include in the 
     annual assessment a request for funds sufficient to implement 
     the recommendations contained in the assessment. (Sec. 806 
     (b))
       The Senate amendment directs the Secretary to include in 
     the annual assessment a request for funds sufficient to 
     implement the recommendations contained in the assessment. 
     (Sec. 809(d)(2))
       The Conference substitute did not adopt this provision.
     (30) Stewardship End Result Contracting
       The House bill (1) permits the Secretary to enter into 
     stewardship contracts to implement the National Fire Plan on 
     National Forest Service lands under the direction of the 
     assessment and with the authorities described in section 347 
     of the Department of the Interior Appropriations Act of 1999. 
     But, the period of the contracts will be for 10 years. The 
     House bill also provides that the authority of the Secretary 
     to enter into contracts under this section expires on 
     September 30, 2007. (Sec. 806(c))
       The Senate amendment permits the Secretary to enter into no 
     more than 28 stewardship end result contracts to implement 
     the National Fire Plan. The contracting goals and authorities 
     outlined in the original stewardship contracting 
     authorization in the 1999 Department of the Interior 
     Appropriations Act (16 U.S.C. 2104 note; Public Law 105-277, 
     Section 347, subsections (b) through (g) apply to these 
     contracts. Fourteen of the 28 contracts shall be subject to 
     additional conditions. (Sec. 809(d)(3))
       The Conference substitute did not adopt this provision.
     (31) Status Report
       The House bill beginning in fiscal year 2003, requires the 
     Secretary to include a status report of stewardship contracts 
     underway in the annual assessment submitted to Congress. 
     (Sec. 806(d))
       The Senate amendment, beginning in fiscal year 2003, 
     requires the Secretary to include in the annual assessment a 
     status report on the contracts entered into under the Long-
     term Forest Stewardship Contracts for Hazardous Fuels Removal 
     section. (Sec. 809(d)(3)(C))
       The Conference substitute did not adopt this provision.
     (32) Authorization of Appropriations
       The Senate amendment authorizes to be appropriated such 
     sums as are necessary to carry out the Long-term Forest 
     Stewardship Contracts for Hazardous Fuels Removal in 
     subsection (d) for fiscal years 2002 through 2006. (Sec. 
     809(d)(4))
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (33) Excluded Areas
       The Senate amendment allows the Secretary to carry out the 
     Wildfire Prevention and Hazardous Fuel Purchase Program only 
     in the wildland/urban interface. (Sec. 809(e))
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (34) Duration
       The House bill provides that the authority of the Secretary 
     to enter into contracts under the Long-term Forest 
     Stewardship contracts for Hazardous Fuels Removal and 
     Implementation of National Fire Plan section expires on 
     September 30, 2007. (Sec. 806 (c)(2))
       The Senate amendment terminates the Secretary's authority 
     under the Wildfire Prevention and Hazardous Fuel Purchase 
     Program on September 30, 2006. (Sec. 809(f))
       The Conference substitute did not adopt this provision.
     (35) Hazardous Fuels to Energy Grant Program
       The House bill lists findings of Congress with respect to 
     damages caused by wildfire disasters, risk of communities to 
     wildfire, effect that modification of forest fuel load 
     conditions will have on minimizing damage from wildfires, and 
     hazardous fuels as an abundant renewable resource. (Sec. 
     921(a))
       The Senate amendment lists Congress findings with respect 
     to wildfire damage, risk to communities from wildfire, 
     accumulation of heavy forest fuel loads, modification of 
     forest fuel load conditions, hazardous fuels as a renewable 
     resource, and the need for the United States to invest in 
     technologies that promote economic and entrepreneurial 
     opportunities in processing forest products removed through 
     hazardous fuel reduction activities. (Sec. 809 (a))
       The Conference substitute did not adopt this provision.
     (36) Definitions
       The House bill defines: (1) biomass-to-energy-facility, (2) 
     forest biomass, (3) hazardous fuels, and (4) Secretary 
     concerned. (Sec. 921(e))
       The Senate amendment defines: (1) biomass-to-energy 
     facility, (2) eligible community, (3) forest biomass, (4) 
     hazardous fuel, (5) Indian tribe, (6) National Fire Plan, (7) 
     person, and (8) Secretary. (Sec. 809(b)
       The Conference substitute did not adopt this provision.
     (37) Hazardous Fuels to Energy Grant Program
       The House bill authorizes the Secretary to make grants to 
     the operators of a biomass-to-energy facility to offset the 
     costs incurred to purchase hazardous fuels from forest lands 
     for the use in the production of electric energy, useful 
     heat, or transportation fuels; and requires that grant 
     recipients be selected on the basis of their planned 
     purchases of hazardous fuels and the level of anticipated 
     benefits to reduced wildfire risk. (Sec. 921(b))
       The Senate amendment (1) authorizes the Secretary to make 
     grants to persons that operate biomass-to-energy facilities 
     to offset the costs incurred by those persons in purchasing 
     hazardous fuels AND persons in rural communities that are 
     seeking ways to improve the use of, or add value to, 
     hazardous fuels; and (2) directs the Secretary to select 
     recipients for grants based on planned purchases of hazardous 
     fuels, the level of anticipated benefits of purchases in 
     reducing risk of wildfires, the extent to which the project 
     avoids adverse environmental impacts, and the level of 
     anticipated benefits for eligible communities. (Sec. 
     809(c)(1))
       The Conference substitute did not adopt this provision.
     (38) Grant Amounts
       The House bill requires grants to be equal to at least $5 
     per ton of hazardous fuels delivered, but not to exceed $10 
     per ton, based on the distance of hazardous fuels from the 
     biomass-to-energy facility. (Sec. 921(c))
       The Senate amendment (1) requires that grant amounts be 
     based on the distance required to transport hazardous fuels 
     to a biomass-to-energy facility and the cost of removal of 
     hazardous fuels; (2) requires that grants be in an amount 
     that is at least equal to $5 per ton but not more than $10 
     per ton of hazardous fuels; and (3) limits grants to 
     $1,500,000 per year, per facility. But, a facility with an 
     annual production of 5 megawatts or less is not subject to 
     this limitation. (Sec. 809)
       The Conference substitute did not adopt this provision.
     (39) Monitoring of Grant Recipient Activities
       The House bill requires grant recipients to keep such 
     records as the Secretary may require, and on notice by the 
     Secretary, grant reasonable access to facility and an 
     opportunity to review records. (Sec. 921(d))
       The Senate amendment requires grant recipients to keep such 
     records as the Secretary may require, and on notice by the 
     Secretary, grant reasonable access to facility and an 
     opportunity to review records. (Sec. 809(c)(3))
       The Conference substitute did not adopt this provision.
     (40) Monitoring of Effects of Treatment
       The House bill requires the Secretary to monitor federal 
     lands from which hazardous fuels are removed and sold to 
     biomass-to-energy facilities to determine and document the 
     reduction in fire hazard. (Sec. 921(e))
       The Senate amendment requires the Secretary to monitor 
     federal lands from which hazardous fuels are removed and sold 
     to a biomass-to-energy facility to determine the 
     environmental impact of fuels removal; requires the 
     Comptroller General to monitor the number of jobs created, 
     the opportunities created for small and micro-businesses and 
     the types and amounts of energy supplies created and energy 
     prices for eligible communities; and requires the Comptroller 
     General to submit an annual report to Congress beginning in 
     fiscal year 2003 that describes the information obtained 
     through monitoring. (Sec. 809(c)(4))
       The Conference substitute did not adopt this provision.
     (41) Authorization of Appropriations
       The House bill authorizes $50 million in appropriations for 
     each fiscal year. (Sec. 921(g))
       The Senate amendment authorizes $50 million in 
     appropriations for each fiscal year from 2002 to 2006. (Sec. 
     809(c)(7))
       The Conference substitute did not adopt this provision.
     (42) Review and Report
       The Senate amendment directs the Comptroller General to 
     submit a report to Congress that describes the results and 
     effectiveness of the Wildfire Prevention and Hazardous Fuel 
     Purchase Program not later than September 30, 2004; requires 
     the Secretary to submit to Congress an annual report 
     describing the results of the pilot program that includes an 
     identification of the size of each facility that receives a 
     grant and the haul radius associated with each grant; and 
     requires the Secretary to submit a report to Congress by 
     December 1, 2003 which describes the technical feasibility of 
     the use of small diameter trees and biomass for energy 
     production, the environmental impacts of using small diameter 
     trees and forest residues and any social or economic benefits 
     of small-scale biomass energy units for rural communities. 
     (Sec. 809 (c)(5))
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.

[[Page H1965]]

     (43) Grants to Other Persons
       The House bill contains no comparable provision.
       The Senate amendment allows the Secretary to make grants to 
     persons in rural communities that are seeking to ways to 
     improve the use of, or add value to, hazardous fuels. (Sec. 
     809(c)(6))
       The Conference substitute did not adopt this provision.
     (44) Excluded Areas
       The Senate amendment allows the Secretary to carry out the 
     Wildfire Prevention and Hazardous Fuel Purchase Program only 
     in the wildland/urban interface. (Sec. 809(e))
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (45) Termination of Authority
       The Senate amendment terminates the Secretary's authority 
     under the Wildfire Prevention and Hazardous Fuel Purchase 
     Program on September 30, 2006. (Sec. 809(f))
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (46) McIntire-Stennis Cooperative Forestry Research Program
       The House bill reaffirms the importance of the McIntire-
     Stennis Cooperative Forestry Act. (Sec. 807)
       The Senate amendment reaffirms the importance of the 
     McIntire-Stennis Cooperative Forestry Act. (Sec. 802)
       The Conference substitute adopts the House provision with 
     minor technical change to public law number. (Sec. 807)
       The Managers recognize the importance of university-based 
     programs in forest and natural resources to the success of 
     many of the technical assistance and cost-share programs in 
     the Conservation and Forestry Titles of this Act including 
     the Conservation Reserve Program, EQIP, Sustainable Forestry 
     Outreach Initiative, Forest Land Enhancement Program. As 
     these programs are expanded and enhanced, there will be an 
     increased need for science-based information in the 
     development of these initiatives. The nation's forestry 
     schools and colleges are uniquely equipped to expand the base 
     of knowledge and to assist in the delivery of educational 
     outreach to our nation's nonfederal forest landowners. The 
     Managers expect the Department to seek greater cooperation 
     and collaboration with universities as it implements these 
     various technical assistance and cost-share programs.
     (47) Sustainable Forestry Cooperative Program
       The Senate amendment amends the Cooperative Forestry 
     Assistance Act of 1978 by inserting a new section 5A:
       The Senate amendment defines: (a) farmer or rancher, (b) 
     forestry cooperative, and (c) non-industrial private 
     forestland.
       The Senate amendment directs the Secretary to establish a 
     program to provide grants to nonprofit organizations on a 
     competitive basis to establish and support forestry 
     cooperatives.
       The Senate amendment requires funds to be used for the 
     support of forestry cooperatives or the support of a 
     sustainable forestry practice of a member of a cooperative.
       The Senate amendment requires the Secretary to provide 
     funds only to a nonprofit organization with demonstrated 
     expertise in cooperative development as determined by the 
     Secretary. Requires funds being used to support a land 
     management practice to comply with an approved forest plan.
       The Senate amendment makes $2 million available from the 
     Treasury to remain available until expended. (Sec. 805)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (48) Forest Fire Research Centers
       The Senate amendment lists Congressional findings with 
     respect to: (1) increasing threat of fire to forest land and 
     rangeland, (2) concentration of fire threat in the western 
     part of the United States, (3) degraded condition of forest 
     land and rangeland, (4) results of current land management 
     practices in the United States, (5) population movement into 
     wildland-urban interface, (6) budgets of governments, (7) 
     diminishing Federal resources for fire research, (h) funding 
     for Federal fire research program, and (8) critical need for 
     cost-effective investments in improved fire management 
     technologies (Sec. 808(a)).
       The Senate amendment directs the Secretary to establish at 
     least 2 forest fire research centers at institutions of 
     higher education to: (1) conduct integrative, 
     interdisciplinary research into the ecological, socioeconomic 
     and environmental impact of fire control and the use of 
     managing ecosystems and landscapes to facilitate fire 
     control, and (2) to develop mechanisms to transfer new fire 
     technologies (Sec. 808(b)).
       The Senate amendment directs the Secretary, in consultation 
     with the Secretary of Interior, to establish an advisory 
     committee to establish priorities for research projects 
     conducted at the forest fire research centers established 
     above (Sec. 808(c))
       The Senate amendment authorizes the appropriation of such 
     sums as are necessary to carry out this section. (Sec. 
     808(d))
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (49) Watershed forestry assistance program
       The Senate amendment lists Congressional findings with 
     respect to: (1) public attitudes about forest management, (2) 
     benefits of proper stewardship, (3) importance of forests to 
     protecting the drinking water supply, (4) forest loss and 
     fragmentation in urbanizing areas, (5) scientific evidence 
     and public awareness about forest management and water 
     quality, (6) application of forestry best management 
     practices, (7) efforts to improve forestry best management 
     practices, (8) role of forests in maintenance of clean water, 
     (9) burden of management on private forest land owners, (10) 
     need to integrate management, conservation, restoration and 
     stewardship, (11) responsibility of federal government, (12) 
     availability of federal assistance, and (13) the need for 
     increased research, education, technical and financial 
     assistance to private forest land owners.
       The Senate amendment describes the purposes of this section 
     as: (1) improving the understanding of landowners and public 
     with respect to the relationship between water quality and 
     forest management, (2) encouraging landowners to utilize 
     trees to promote water quality, (3) enhancing and 
     complementing source water protection in watersheds that 
     provide drinking water, (4) establishing new partnerships, 
     and (5) providing technical and financial assistance to 
     States.
       The Senate amendment directs the Secretary to establish a 
     new program to provide states, through the State foresters, 
     technical, financial, and related assistance to expand forest 
     stewardship and prevent water quality degradation and address 
     watershed issues on non-Federal forestland (Sec. 812(c)); 
     requires the Secretary to cooperate with the State Foresters 
     to develop a plan to provide technical assistance to States 
     in addressing water quality; requires the plan to include 
     provisions to accomplish the following tasks: (1) build and 
     strengthen watershed partnerships, (2) provide State BMPs and 
     water quality technical assistance to landowners, (3) provide 
     technical guidance to land managers and policymakers, (4) 
     complement State non-point source assessment and management 
     plans, (5) provide opportunities for coordination and 
     cooperation among Federal and State agencies for water and 
     watershed management, and (6) provide forest resource data 
     for improved implementation of state BMPs; directs the 
     Secretary to develop a cost-share program to provide grants 
     and other assistance for eligible programs and projects; sets 
     forth criteria which the Secretary must consider in 
     allocating funds among the states; requires the State 
     foresters, in coordination with the State Coordinating 
     Committee, to provide annual grants and cost-share 
     payments to communities, non-profit groups, and landowners 
     to carry out eligible programs and projects; directs the 
     Secretary to prioritize cost-share assistance to eligible 
     programs and projects that are identified by the State 
     foresters and the State Stewardship Committees as having a 
     greater need for assistance; limits the amount of federal 
     cost-share to not exceed 75% and permits the non-federal 
     share to be made in the form of cash, services, or in-kind 
     contributions; allows states to use a portion of the funds 
     made available to the state to establish and fill a 
     position of watershed forester to lead state-wide 
     programs; authorizes $20 million to be appropriated for 
     each fiscal year through 2006; and requires funding to be 
     allocated in such a manner that 75% is going to the cost-
     share portion of the program and the remainder for other 
     provisions within the section. (Sec. 812)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (50) General Provisions
       The Senate amendment amends section 13 of the Cooperative 
     Forestry Assistance Act to enable the Secretary to make 
     grants and enter into contracts, agreements or other 
     arrangements to carry out the Cooperative Forestry Assistance 
     Act. (Sec. 814)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (51) State Forest Stewardship Coordinating Committees
       The Senate amendment amends section 19(b) of the 
     Cooperative Forestry Assistance Act by adding the U.S. Fish 
     and Wildlife Service as a member of the State Forest 
     Stewardship Coordinating Committees.
       The Senate amendment also directs the Committees to submit 
     to the Secretary, and House and Senate Agriculture Committees 
     an annual report of the list of members on the Committee, and 
     an explanation of why certain groups may not be represented. 
     (Sec. 815)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (52) Forest Legacy Program
       The Senate amendment amends section 7(l) of the Cooperative 
     Forestry Management Act to allow a state to authorize any 
     local government or qualified organization to acquire land or 
     conservation easements to carry out the Forest Legacy Program 
     in that state. (Sec. 807)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.

[[Page H1966]]

     (53) Chesapeake Bay Watershed Forestry Program
       The Senate amendment amends the Cooperative Forestry 
     Assistance Act of 1978 by adding a new section 9A:
       The Senate amendment lists definitions for: (1) agreement, 
     (2) Bay-Area state, (3) Chesapeake Bay Executive Council, (4) 
     director, (5) eligible entity, (6) eligible project, (7) 
     program, and (8) Secretary.
       The Senate amendment directs the Secretary to establish a 
     Chesapeake Bay Watershed Forestry Program to provide 
     technical and financial assistance to carry out eligible 
     projects; and directs the Secretary to designate a Forest 
     Service employee to serve as a director for the Chesapeake 
     Bay watershed forestry efforts.
       The Senate amendment allows the Secretary, in coordination 
     with the director, to provide grants to assist eligible 
     entities in carrying out eligible projects; and limits the 
     federal share of the cost-share assistance to 75%.
       The Senate amendment requires the director, in cooperation 
     with the Council, to conduct a study to: (1) assess the 
     extent and location of forest loss and fragmentation, (2) 
     identify critical forest land, (3) prioritize afforestation 
     needs, (4) recommend management strategies to expand 
     conservation and stewardship of the forest ecosystem and ways 
     in which the Federal government can work with State, county, 
     local, and private entities to conserve critical forests 
     including establishing new units of the National Forest 
     System, and (5) identify further inventory assessment and 
     research which is needed and requires the director to report 
     to Congress not later than 2 years after the date of 
     enactment of this legislation.
       The Senate amendment allows the Secretary, in cooperation 
     with the director, to establish a cooperative program to 
     provide technical and financial assistance to eligible 
     entities to meet the needs of the urban population of the 
     watershed in managing forest land.
       The Senate amendment authorizes $3 million in 
     appropriations for fiscal year 2002 and $3.5 million for each 
     fiscal year in 2003 through 2006. (Sec. 810)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (54) Suburban and Community Forestry and Open Space 
         Initiative
       The Senate amendment amends the Cooperative Forestry 
     Assistance Act of 1978 by adding a new section 7A:
       The Senate amendment lists definitions for: (1) eligible 
     entity, (2) Indian tribe, (3) private forestland, (4) 
     program, and (5) Secretary.
       The Senate amendment establishes a Suburban and Community 
     Forestry and Open Space Initiative within the Forest Service 
     to provide assistance to eligible entities to carry out 
     projects and activities to conserve private forest land and 
     maintain working forests in suburban environments.
       The Senate Amendment requires the Secretary, in 
     consultation with the State foresters, to establish criteria 
     for identifying private forest land in each state that may be 
     conserved, and identifying eligible entities; requires the 
     Secretary to then award grants to eligible entities to carry 
     out certain projects or activities; and requires the 
     Secretary to give priority to projects that promote the 
     following objectives: (1) sustainable forest management, (2) 
     education programs and curricula relating to sustainable 
     forestry, and (3) community involvement in determining the 
     objectives for projects or activities that are funded under 
     this program, and limits grants to 50% of the cost of a 
     project or activity.
       The Senate amendment allows funds to be used to purchase 
     land or easements only from willing sellers at fair market 
     value; requires sales at less than fair market value only on 
     certification by the landowner that the sale is being entered 
     into willingly and without coercion; and allows title to be 
     held, as determined by the Secretary, by a State or non-
     profit organization.
       The Senate amendment authorizes $50 million to be 
     appropriated for fiscal year 2003 and such sums as are 
     necessary for each fiscal year thereafter. (Sec. 813)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (55) USDA National Agro forestry Center
       The Senate amendment amends section 1243 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 (16 U.S.C. 
     1642 note; Public Law 101-624) by striking the section 
     heading and inserting: ``USDA National Agro forestry 
     Center''. (Sec. 816)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.. 
     (Sec. 819)
     (56) Office of Tribal Relations
       The Senate amendment amends the Cooperative Forestry 
     Assistance Act of 1978 by inserting a new section 19A:
       The Senate amendment defines the following: (1) Indian 
     tribe, (2) office, and (3) Secretary.
       The Senate Amendment directs the Secretary to establish an 
     Office of Tribal Relations within the Forest Service and 
     requires the Secretary to appoint a director of such office 
     and to consult with interested tribes in making this 
     determination; and requires the director to report directly 
     to the Secretary.
       The Senate amendment requires the director to provide 
     assistance to the Secretary on all issues, policies, actions, 
     and programs of the Forest Service that affect Indian tribes 
     and requires the director to submit an annual report on the 
     status of relations between the Forest Service and Indian 
     Tribes to the Secretary. (Sec. 817)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (57) Assistance to Tribal Governments
       The Senate amendment amends the Cooperative Forestry 
     Assistance Act of 1978 by adding a new section 21:
       The Senate amendment defines an Indian tribe.
       The Senate amendment allows the Secretary to provide 
     financial, technical, educational and related assistance to 
     Indian tribes.
       The Senate amendment directs the Secretary to promulgate 
     regulations in consultation with Indian tribes and 
     representatives of tribes, to implement the program.
       The Senate amendment directs the Secretary to coordinate 
     with the Secretary of the Interior to establish, implement 
     and administer the program.
       The Senate amendment authorizes the appropriation of such 
     sums, as are necessary for fiscal year 2002 and each fiscal 
     year thereafter. (Sec. 818)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (58) Sudden Oak Death Syndrome
       The Senate amendment directs the Secretary to research, 
     monitor and carry out a treatment program to develop, 
     control, manage, or eradicate Sudden Oak Death Syndrome on 
     public and private land.
       The Senate amendment requires the Secretary to conduct 
     management, regulation, and fire prevention activities to 
     reduce the threat of fire and fallen trees killed by Sudden 
     Oak Death Syndrome.
       The Senate amendment requires the Secretary to conduct 
     education and outreach activities to make information 
     available to the public on Sudden Oak Death Syndrome.
       The Senate amendment requires the Secretary to establish a 
     Sudden Oak Death Syndrome advisory committee to assist the 
     Secretary in carrying out this section.
       The Senate amendment authorizes $14.25 million in 
     appropriations for each of the fiscal years in 2002 through 
     2006. (Sec. 819)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (59) Independent Investigation of Fire-Fighter Fatalities
       The Senate amendment requires the Inspector General of the 
     Department of Agriculture to conduct an independent 
     investigation whenever there is a fatality of an officer or 
     employee of the Forest Service that occurs due to wildfire 
     entrapment or burn over and requires the IG to submit a 
     report to Congress and the Secretary of Agriculture. (Sec. 
     820)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.
     (60) Adaptive Ecosystem Restoration of Arizona and New Mexico 
         Forests and Woodlands
       The Senate amendment lists Congressional findings with 
     respect to: (1) degradation of ecological conditions of 
     forests and woodlands in Arizona and New Mexico, (2) 
     unnaturally high quantities of biomass, (3) effects of 
     degraded forests and woodlands, (4) benefits of healthy 
     forests and woodland ecosystems, (5) importance of best 
     available scientific knowledge in developing forest and 
     woodland treatments, (6) failure of treatments not based on 
     sound science, (7) integration of scientific research and 
     land management activities, and (8) translation of scientific 
     knowledge;
       The Senate amendment describes the purposes of this section 
     as: (1) improving the ecological health, resource values, and 
     sustainability of forest and woodland ecosystems in Arizona 
     and New Mexico, (2) reducing the threat of unnatural 
     wildfire, disease, and insect infestations in those states, 
     (3) restoring ecosystem structure and function so that 
     ecosystems will support biodiversity; enhance watershed 
     values; increase water flow; and increase tree, grass, forb, 
     and shrub vigor and growth to provide sustainable economic 
     activities, (4) developing the scientific knowledge to inform 
     adaptive ecosystem management restoration treatments that 
     will restore long-term ecological health to forests and 
     woodlands in the States, and (5) encouraging collaboration 
     among land management agencies, communities, and interest 
     groups in developing, implementing, and monitoring adaptive 
     ecosystem management restoration treatments that are 
     ecologically sound, economically viable, and socially 
     responsible;
       The Senate amendment lists definitions for: (1) adaptive 
     ecosystem management, (2) ecological integrity, (3) 
     ecological restoration, (4) institute, (5) land management 
     agency, (6) practitioner, (7) Secretaries, and (8) state.
       The Senate amendment requires the Secretary of Agriculture, 
     in consultation with the Secretary of the Interior, to 
     establish: (1)

[[Page H1967]]

     an Ecological Restoration Institute in Flagstaff, Arizona, 
     and (2) an institute at a college or university in the State 
     of New Mexico.
       The Senate amendment requires each institute to plan, 
     conduct, or otherwise arrange for applied ecosystem 
     management research that: (1) assists in answering questions 
     identified by land managers, practitioners, and others 
     concerned with land management, (2) will be useful in the 
     development and implementation of practical, science-based, 
     ecological restoration treatments, (3) translate scientific 
     knowledge into communication tools that are easily understood 
     by land managers, natural resource professionals, and 
     concerned citizens, and (4) provide similar information to 
     land managers and other interested persons.
       The Senate amendment requires each institute to cooperate 
     with various entities, including colleges and universities.
       The Senate amendment requires the Secretary, in 
     consultation with the Secretary of Interior, to complete a 
     detailed evaluation of each institute not later than 5 years 
     after the date of enactment of this Act, and every 5 years 
     thereafter.
       The Senate amendment authorizes $10 million in 
     appropriations for each fiscal year. (Sec. 821)
       The House bill contains no comparable provision.
       The Conference substitute did not adopt this provision.

                            TITLE IX--ENERGY

     (1) Findings
       The Senate amendment provides Congressional findings with 
     respect to the development of agriculturally based renewable 
     energy, the promotion of energy efficiency and biobased 
     products. (Section 901)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (2) Consolidated Farm and Rural Development Act
       The Senate amendment amends the Consolidated Farm and Rural 
     Development Act by adding a new subtitle on ``Clean Energy'' 
     and includes definitions for biomass, renewable energy, and 
     rural small business. (Section 902)
       The House bill contains no comparable provision.
       The Conference substitute does not amend the Consolidated 
     Farm and Rural Development Act, but rather maintains the 
     section as individual stand-alone provisions. The substitute 
     adopts the Senate definitions with amendments. (Section 9001)
     (3) Federal Procurement of Biobased Products
       The Senate amendment establishes a federal purchasing 
     program for biobased products if they are on a United States 
     Department of Agriculture biobased products list and the 
     biobased products are reasonably comparable in price, 
     performance and availability to non-biobased products. The 
     section also instructs the Secretary to develop a labeling 
     program for biobased products similar to the Energy Star 
     program of the Environmental Protection Agency and Department 
     of Energy. The amendment provides $2,000,000 annually in each 
     of fiscal years 2002-2006. (Section 902)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments. The substitute establishes a new program for the 
     purchase of biobased products by Federal agencies, which is 
     modeled on the existing program for purchase of recycled 
     materials under section 6002 of the Solid Waste Disposal Act 
     (42 U.S.C. 6962). The intent of the section is to stimulate 
     the production of new biobased products and to energize 
     emerging markets for those products. The section also 
     includes a voluntary biobased-labeling program. The 
     Conference substitute provides $1,000,000 annually for each 
     of fiscal year 2002-2007 for testing biobased products to 
     carry out this section. (Section 9002) The Managers encourage 
     the Secretary to make the results of such testing available 
     to the public.
       The United States Department of Agriculture, in 
     consultation with the Environmental Protection Agency, 
     General Services Administration, and the Department of 
     Commerce, will serve as the final arbiter of what is or is 
     not considered a biobased product to be listed and afforded 
     Federal procurement preference. The Office of Federal 
     Procurement Policy will ensure compliance by all Federal 
     agencies, including executive departments, military 
     departments, Government corporations, Government controlled 
     corporations, and other establishments of Federal government.
       The Managers intend that any procurement regulations 
     implementing this section will be promulgated within the 
     existing procurement system through revisions to the Federal 
     Acquisition Regulation by the Civilian Agency Acquisition 
     Council and the Defense Acquisition Council and through 
     revisions as necessary to individual agency acquisition 
     regulations by such agencies.
       The Managers encourage the Secretary to carry out the 
     biobased product analysis in this section through the Office 
     of Energy Policy and New Uses, which have undertaken economic 
     and technical feasibility analysis and have identified 
     numerous examples of biobased products that can be easily 
     substituted for nonbiobased products.
     (4) Biorefinery Development Grants
       The Senate amendment establishes a competitive grant 
     program to support the development of biorefineries for the 
     conversion of biomass into multiple products such as fuels, 
     chemicals and electricity. The amendment provides $15,000,000 
     annually in each of fiscal years 2002-2006. (Section 902)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments. The section is subject to appropriated funds. 
     (Section 9003)
       In making selections for competitive awards, the Secretary 
     is encouraged to give particular weight to projects that 
     produce multiple products- fuels, chemicals, and in some 
     cases power--and do so in a cost effective and 
     environmentally sound manner.
     (5) Biodiesel Fuel Education Program
       The Senate amendment establishes a competitive grant 
     program to educate governmental and private entities with 
     vehicle fleets and the public about the benefits of biodiesel 
     fuel use. The amendment provides $5,000,000 annually in each 
     of fiscal year 2003-2006. (Section 902)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments. The Substitute provides $1,000,000 annually in 
     each of fiscal year 2003-2007. (Section 9004)
       The Managers encourage the Secretary to utilize the 
     expertise of the Office of Energy Policy and New Uses in 
     carrying out the purposes of this section.
     (6) Renewable Energy Development Loan and Grant Program
       The House bill amends Section 310B of the Consolidated Farm 
     and Rural Development Act by adding other renewable energy 
     systems including wind energy and anaerobic digesters to the 
     list of purposes for which loans and loan guarantees are 
     available. (Section 606) The House bill also contains a 
     provision that provides value-added grants to entities to 
     develop new marketing and income opportunities for farmers. 
     (Section 602)
       The Senate amendment establishes a competitive grant and 
     loan program to assist new cooperatives and business 
     ventures, which are at least 51 percent owned by farmers or 
     ranchers, in the development of renewable energy projects to 
     produce electricity. The amendment provides $16,000,000 
     annually in each of fiscal years 2002-2006. (Section 902)
       The Conference substitute adopts the House provisions with 
     amendment. The value-added grant program in the Rural 
     Development title has been expanded to better achieve the 
     purposes of this section. This expansion, along with the 
     adoption of House language that allows loans for these 
     purposes, should accomplish the goals of the Senate's 
     provision and encourage more farmers and ranchers to become 
     involved in the ownership of renewable energy systems. 
     (Sections 6401 and 6013)
     (7) Energy Audit and Renewable Energy Development Program
       The Senate amendment establishes a competitive grant 
     program for entities to administer energy audits and 
     renewable energy development assessments for farmers, 
     ranchers and rural small businesses. The amendment provides 
     $15,000,000 annually in each of fiscal years 2002-2006. 
     (Section 902)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments. The section is subject to appropriated funds. 
     (Section 9005)
     (8) Renewable Energy Systems and Energy Efficiency 
         Improvements
       The House bill authorizes the Secretary to provide to 
     individuals a loan guarantee under Section 4 of the Rural 
     Electrification Act to finance the purchase of renewable 
     energy systems, including wind energy systems and anaerobic 
     digesters for the purpose of energy generation. (Section 605)
       The Senate amendment establishes a loan, loan guarantee and 
     grant program to assist eligible farmers, ranchers and rural 
     small businesses in purchasing renewable energy systems and 
     making energy efficiency improvements. The amendment provides 
     $33,000,000 annually in each of fiscal years 2002-2006. 
     (Section 902)
       The Conference substitute adopts the Senate provision with 
     amendments. The Conference substitute provides $23,000,000 
     annually in each of fiscal year 2003-2007. (Section 9006)
       The Managers intend for the Secretary to consider funding 
     energy audits an eligible energy efficiency improvement 
     measure under this section.
     (9) Hydrogen and Fuel Cell Technologies
       The Senate amendment establishes a competitive grant 
     program to eligible entities to demonstrate the use of 
     hydrogen and fuel cell technologies in farm and rural 
     applications. The amendment provides $5,000,000 in each of 
     fiscal years 2002-2006. (Section 902)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision and 
     replaces it with language directing the Secretaries of 
     Agriculture and Energy to enter into a memorandum of 
     understanding regarding hydrogen and fuel cell technology 
     applications for agricultural producers and rural 
     communities. The memorandum of understanding also requires 
     the Secretary of Agriculture to disseminate information 
     relating to hydrogen and fuel cell

[[Page H1968]]

     technologies to rural communities and agricultural producers. 
     (Section 9007)
       The Managers encourage the Secretary to utilize the 
     expertise of the Office of Energy Policy and New Uses in 
     carrying out this section.
     (10) Technical Assistance for Farmers and Ranchers to Develop 
         Renewable Energy Resources
       The House bill expands the purpose of the Environmental 
     Quality Incentives Program to include assistance to farmers 
     and ranchers for the assessment and development of their on-
     farm renewable resources, including biomass for production of 
     power and fuel, wind and solar. (Section 942a)
       The House bill also provides that the Secretary of 
     Agriculture, through the Cooperative State Research, 
     Education, and Extension Service and, to the extent 
     practicable, in collaboration with the Natural Resources 
     Conservation Service, regional biomass programs under the 
     Department of Energy, and other appropriate entities, may 
     provide education and technical assistance to farmers and 
     ranchers for the development and marketing of renewable 
     energy resources, including biomass for the production of 
     power and fuels, wind, solar, and geothermal. (Section 942b)
       The Senate amendment provides that the Secretary, acting 
     through the Cooperative State Research, Education, and 
     Extension Service in consultation with the Natural Resources 
     Conservation Service, regional biomass programs under the 
     Department of Energy, and other entities as appropriate, may 
     provide for education and technical assistance to farmers and 
     ranchers for the development and marketing of renewable 
     energy resources. The Secretary may retain up to 4 percent to 
     pay administrative expenses incurred in carrying out this 
     section. (Section 902)
       The Conference substitute deletes both the House and Senate 
     provisions.
       The Managers encourage the Cooperative State Research, 
     Education, and Extension Service to provide education and 
     technical assistance to agricultural producers for the 
     development of renewable energy resources. Such assistance 
     should enable producers to become more energy efficient and 
     provide for the development and marketing of renewable energy 
     resources. In assisting producers, the Cooperative Extension 
     Service may consult with other entities as appropriate.
     (11) Biomass Research and Development
       The House bill extends the Biomass Research and Development 
     Initiative through 2011. (Section 736)
       The Senate amendment extends the Act's termination date to 
     September 30, 2006. The amendment provides $15,000,000 in 
     each of fiscal years 2002-2006. (Section 903)
       The Conference substitute adopts the Senate provision with 
     amendments. The substitute provides $5,000,000 for fiscal 
     year 2002, and 14,000,000 annually for each of fiscal year 
     2003-2007. (Section 9008)
     (12) Cooperative Research and Extension Projects
       The Senate amendment establishes a carbon sequestration 
     research and development program to promote understanding of 
     the net sequestration of carbon in soil and net emissions of 
     other greenhouse gases from agriculture. The amendment 
     requires that, within three years, the Secretary convene a 
     conference of key scientific experts on carbon sequestration 
     from various sectors to establish benchmark standards for 
     measuring soil carbon content and net emissions of other 
     greenhouse gases, designate measurement techniques and 
     modeling approaches to achieve such standards, and evaluate 
     results of analyses on baseline, permanence and leakage 
     issues. The section authorizes appropriations of $25,000,000 
     annually. (Section 902)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments that incorporate this section into Section 221 of 
     the Agricultural Risk Protection Act of 2000 (114 Stat. 
     407)--Carbon Cycle Research. (Section 9009) The substitute 
     also reauthorizes Section 221 of the Agriculture Risk 
     Protection Act of 2002 (114 Stat. 407)--Carbon Cycle Research 
     through fiscal year 2007. (Section 7223)
       The Managers encourage the Secretary to convene a 
     conference of key scientific experts on carbon to evaluate 
     tools and procedures for measuring the carbon content of 
     soils and plants (including trees) and net emissions of other 
     greenhouse gases from agriculture, and identify techniques 
     and modeling approaches for measuring carbon content 
     associated with several different levels of precision. 
     Conference participants should include grant or cooperative 
     agreement recipients under federal carbon cycle research 
     programs, other experts on carbon sequestration from academia 
     and the private sector, and government scientists in the area 
     of carbon sequestration, from the Department of Agriculture 
     and other federal agencies with programs in carbon cycle 
     research. The Secretary is encouraged to provide information 
     to the public regarding any such conference proceedings.
       The Managers encourage the Secretary to establish 
     demonstration projects that assist agricultural producers and 
     farmer-owned cooperatives in paying the costs associated with 
     the testing of methods developed under this section 
     (including costs incurred in employing certified independent 
     third persons to carry out those activities). In the view of 
     the Managers, such demonstration projects may provide 
     valuable data in testing the methods by which farmers measure 
     their storage of carbon and reduce net emissions of 
     greenhouse gases.
     (13) Demonstration Projects and Outreach
       The Senate amendment establishes carbon sequestration 
     monitoring programs; demonstration projects of methods for 
     measuring, verifying and monitoring changes in carbon content 
     and greenhouse gas emissions; and periodic outreach to 
     farmers and ranchers regarding the connection between global 
     climate change mitigation strategies and agriculture. The 
     section authorizes appropriations of $10,000,000 annually. 
     (Section 902)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. 
     Some of the goals of this section have been incorporated into 
     Section 9009.
     (14) Rural Electrification Act of 1936
       The House bill amends Section 310B of the Consolidated Farm 
     and Rural Development Act to specifically include wind energy 
     systems and anaerobic digesters in the list of purposes for 
     which loans and loan guarantees are available. (Section 606)
       The Senate amendment amends the Rural Electrification Act 
     of 1936 by adding Section 21 at the end which establishes a 
     grant and loan program to assist rural electric cooperatives 
     and other rural electric utilities in developing renewable 
     energy to serve the needs of rural communities or for rural 
     economic development. Grants may be used to help pay for 
     renewable energy project feasibility studies and technical 
     assistance. Loans are available for other costs associated 
     with a project. The amendment provides $9,000,000 in each of 
     fiscal years 2002-2006. (Section 904)
       The Conference substitute adopts the House provision. 
     (Section 6013)
       The Managers encourage the Secretary to use existing 
     authorities to provide loans, loan guarantees and grants to 
     rural electric cooperatives and other electric utilities to 
     promote the development of economically and environmentally 
     sustainable renewable energy projects to serve the needs of 
     rural communities or to promote rural economic development.
     (15) Carbon Sequestration Demonstration Program
       The Senate amendment establishes a competitive research and 
     development program to test the methodologies by which 
     private parties may pay farmers and foresters a market-based 
     fee to store carbon and to otherwise reduce net emissions of 
     greenhouse gases. Under this program, the Department of 
     Agriculture would share in the costs of monitoring, verifying 
     and auditing such trades on a demonstration basis and would 
     also make grants to researchers to establish the best 
     methodologies for measuring additional carbon sequestration 
     in soils and plants. The section authorizes appropriations of 
     $20,000,000 annually. (Section 905)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision. 
     Some of the goals of this section are incorporated into 
     Section 9009.
     (16) Sense of Congress Concerning National Renewable Fuels 
         Standard
       The Senate amendment expresses the sense of Congress that a 
     national renewable fuels program should be adopted and that 
     the Department of Agriculture should ensure that its policies 
     and programs promote the production of fuels from renewable 
     fuel sources. (Section 906)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (17) Continuation of the Bioenergy Program
       The House bill requires the Secretary to include animal 
     fats, agricultural by-products, and oils as eligible 
     commodities under the existing Bioenergy Program (7 CFR 
     1424). (Section 922)
       The Senate amendment expresses the sense of Congress that 
     biofuel production capacity will be needed to phase out 
     methyl tertiary butyl ether in gasoline, and because of the 
     dependence of the United States on foreign oil, the bioenergy 
     program of the Department of Agriculture should be continued 
     and expanded. (Section 907)
       The Conference substitute deletes both provisions, and 
     instead authorizes the continuation of the Commodity Credit 
     Corporation Bioenergy Program and includes animal byproducts 
     and fat, oils and greases (including recycled fats, oils and 
     greases) as eligible commodities. The conference substitute 
     provides a total of $204 million to fund this program during 
     fiscal years 2003-2006. (Section 9010)
       The Managers encourage the Secretary to investigate the 
     feasibility of utilizing wheat that has been infested with 
     karnal bunt spores, and for which a market is not readily 
     available, in the operation of the Commodity Credit 
     Corporation Bioenergy Program.
       General Intent--Title IX. The Managers intend for all 
     reports to Congress required under Title IX to be transmitted 
     to the Senate Committee on Agriculture, Nutrition and 
     Forestry; the House Committee on Agriculture; the House 
     Committee on Energy and Commerce and the House Committee on 
     Science.
       The Managers intend for the Secretary to identify and 
     incorporate the mission of Title

[[Page H1969]]

     IX and the strategy for implementation as part of the 
     reporting required by the Government Performance and Results 
     Act.

                   Title X--Miscellaneous Provisions


                  Subtitle A--Tree Assistance Program

     (1) Eligibility
       The House bill requires the Secretary of Agriculture to 
     provide assistance to eligible orchardists that planted trees 
     for commercial purposes but lost such trees as a result of a 
     natural disaster. Orchardists qualify for assistance only if 
     tree mortality exceeds 15%. (Section 901)
       The Senate amendment amends Sec. 194 of the Federal 
     Agriculture Improvement Act of 1996 as follows: Sec. 194(b) 
     requires the Secretary of Agriculture to provide assistance 
     to eligible orchardists that planted trees for commercial 
     purposes but lost such trees as a result of a natural 
     disaster. Orchardists qualify for assistance only if tree 
     mortality exceeds 15%. (Sec. 1062)
       The Conference substitute adopts the House provision. (Sec. 
     10202)
     (2) Assistance
       The House bill amends the Tree Assistance Program 
     authorized by the Disaster Assistance Act of 1988 to 
     establish a reimbursement of either 75% of the cost of 
     replanting eligible trees lost or, at the discretion of the 
     Secretary, sufficient seedlings to reestablish the stand. 
     (Sec. 902)
       The Senate amendment amends Sec. 194(c)(1) consists of 
     either reimbursement of 75% of the cost of replanting 
     eligible trees lost or, at the discretion of the Secretary, 
     sufficient seedlings to reestablish the stand. (Sec. 1062)
       The Conference substitute adopts the House provision. (Sec. 
     10203)
     (3) Limitation on Assistance
       The House bill establishes that a limit on payments per 
     person may not exceed $50,000 or an equivalent value in tree 
     seedlings; requires the Secretary to issue regulations 
     defining a person; and requires the Secretary to issue 
     regulations prescribing rules to ensure a fair and reasonable 
     application of the limitation established under this section. 
     (Sec. 903)
       The Senate amendment amends Sec. 194(c)(2) by setting 
     payment limitations per person to not exceed $100,000 or an 
     equivalent value in tree seedlings; requires the Secretary to 
     issue regulations defining a person; and requires the 
     Secretary to issue regulations prescribing rules to ensure a 
     fair and reasonable application of the limitation established 
     under this section. (Sec. 1062)
       The Conference substitute adopts the House provision with 
     an amendment that a payment limitation per person may not 
     exceed $75,000 or an equivalent in tree seedlings. (Sec. 
     10204)
     (4) Definitions
       The House bill defines eligible orchardist, natural 
     disaster and tree. (Sec. 904)
       The Senate amendment defines Sec. 194 (a) eligible 
     orchardist, natural disaster, tree and Secretary. These 
     definitions are very similar to the House bill, with one 
     exception as follow: there is no requirement that an eligible 
     orchardist owns 500 acres or less of such trees. (Sec. 1062)
       The Conference substitute adopts the House provision with 
     amendments that the total quantity of acres for which a 
     person shall be entitled to receive payments under this 
     chapter may not exceed 500 acres and adds ``lightning'' to 
     the definition of natural disaster. (Sec. 10201)
       The Senate amendment makes the Tree Assistance Program an 
     authorization subject to appropriations.
       The Conference substitute adopts the Senate amendment's 
     authorization of Appropriations. (Sec. 10205)
       The Managers acknowledge that assistance was provided to 
     producers to compensate for losses of trees from which a crop 
     is harvested under the Agriculture, Rural Development, Food 
     and Drug Administration, and Related Agencies Appropriations 
     Act of 2000, for losses suffered in 1999, but not since that 
     time. Establishment of legislative authority for the Tree 
     Assistance Program does not preclude seeking assistance under 
     any other authority on behalf of tree crop producers who 
     suffered similar losses between January 2000 and the date of 
     enactment of this Act.


                       Subtitle B--Other Matters

     (5) Hazardous Fuels Reduction Grants to Prevent Wildfire 
         Disasters and Transform Hazardous Fuels to Electric 
         Energy, Useful Heat or Transportation Fuels
       The House bill (1) provides the findings of the Congress on 
     hazardous fuel reduction grants; (2) authorizes the Secretary 
     concerned to make a grant to a person that operates a 
     biomass-to-energy facility to offset the costs incurred to 
     purchase hazardous fuels from forestlands. (3) establishes 
     the grants shall be equal to $5 per ton but not to exceed $10 
     per ton of hazardous fuels based on distance from source to 
     facility; (4) establishes as a condition of receiving a grant 
     under this section, the owner of the facility is required to 
     keep records as required by the Secretary, and to award the 
     Secretary or their designee access to the facility to examine 
     inventory and records of the facility; (5) authorizes the 
     Secretary concerned to monitor Federal lands from which 
     hazardous fuels are removed and sold to a biomass-to-energy 
     facility to determine and document the reduction in fire 
     hazards on such lands; defines biomass-to-energy facility, 
     forest biomass, hazardous fuels, and Secretary concerned; 
     authorizes $50 million for each FY for the duration of the 
     bill. (Sec. 921)
       The Senate amendment (1) provides findings similar to House 
     version findings under Hazardous Fuels Reduction Grants; (2) 
     defines ``eligible community'' as any town, township, 
     municipality, or other similar unit of local government or 
     any area represented by a nonprofit to promote broad-based 
     economic development, and has a population of not more than 
     10,000, and is located within a county with 15% of total 
     labor and income is derived from forestry and is located near 
     forest land the Secretary determines poses a potential 
     hazard, the ``hazardous fuels'' definition is different from 
     the House version, only in that it specifies the land must be 
     in an wildland-urban interface area or in an area located 
     near an eligible community, Indian tribe, Secretary, and 
     others; (3) authorizes the Secretary concerned to make a 
     grant to a person that operates a biomass-to-energy facility 
     to offset the costs incurred to purchase hazardous fuels from 
     forestlands. The Secretary shall select recipients based on 
     planned purchases of hazardous fuels and the anticipated 
     associated wildfire risk reduction; (4) establishes the grant 
     amounts shall be equal to $5 per ton but not to exceed $10 
     per ton of hazardous fuels based on distance from source to 
     facility; OR based on the distance from source to facility 
     and the cost of removal of fuels; (5) establishes a grant 
     shall not exceed $1.5 million for any facility for any year 
     with the exception of a small facility with an annual 
     production of 5 megawatts or less; provides the monitoring of 
     grants is very similar to House version, but with a little 
     more detail; (6) authorizes the Secretary concerned shall 
     monitor Federal lands from which hazardous fuels are removed 
     and sold to a biomass-to-energy facility to determine and 
     document the reduction in fire hazards on such lands; (7) 
     authorizes $50 million for each FY for the duration of the 
     bill. (Sec. 809)
       The Conference substitute deletes both the House and Senate 
     provisions.
     (6) Bioenergy Program
       The House bill requires the Secretary to include animal 
     fats, agricultural by-products, and oils as eligible 
     commodities under the existing Bioenergy Program (7 CFR 
     1424). (Sec. 922)
       The Senate amendment establishes the Sense of Congress that 
     Ethanol and Biodiesel production capacity will be needed to 
     phase out MTBE and U.S. dependence on foreign oil and that 
     the Bioenergy Program (7 CFR 1424) should be continued and 
     expanded. (Sec. 907)
       The Conference substitute deletes both provisions, and 
     instead authorizes the continuation of the Commodity Credit 
     Corporation Bioenergy Program and includes animal byproducts 
     and fat, oils and greases (including recycled fats, oils and 
     greases) as eligible commodities. The conference substitute 
     provides a total of $204 million to fund this program during 
     fiscal years 2003-2006. (Section 9010)
     (7) Availability of Section 32 Funds
       The House bill amends the second undesignated paragraph of 
     section 32 of 7 U.S.C. 612c by striking $300,000,000 and 
     inserting $500,000,000. (Sec. 923)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. (Sec. 
     10602)
     (8) Seniors Farmers Market Nutrition Program
       The House bill allows the Secretary to use $15,000,000 of 
     CCC funds for each of fiscal years 2002 through 2011 to carry 
     out and expand a seniors farmers' market nutrition program. 
     Further explains purposes of program. (Sec. 924)
       The Senate amendment requires the Secretary of the Treasury 
     to transfer $15,000,000 30 days after enactment and each 
     fiscal year 2003 through 2006 to the Secretary of Agriculture 
     to carry out and expand a seniors farmers' market nutrition 
     program. Further explains purposes of program. (Sec. 459)
       The Conference substitute adopts the House provision with 
     an amendment to provide $5 million in 2002, $15 million per 
     year thereafter 2003 through 2007 (The program already 
     received $10 million for FY2002 in the Agriculture, Rural 
     Development, Food and Drug Administration, and Related 
     Agencies Appropriations Act, 2002.). (Sec. 4402)
     (9) Federal Marketing Order for Cane Berries
       The House bill requires the Secretary to issue a Federal 
     marketing order for producers and processors of cane berries 
     grown in the United States. (Section 925)
       The Senate amendment provides marketing orders for 
     producers of cane berries. (Sec. 161)
       The Conference substitute adopts the Senate provision. 
     (Sec. 10601)
       A Federal Marketing Order for cane berries will allow 
     producers to promote orderly marketing through collectively 
     influencing the supply, demand or price and to pool resources 
     to finance research and promotion. Producers need this tool 
     to address low prices due, in part, to overproduction.
     (10) National Appeals Division
       The House bill provides that if an appellant prevails at 
     the regional level in an administrative appeal of a decision 
     by the National Appeals Division, the Agency may not pursue 
     an administrative appeal of that decision to the national 
     level. (Sec. 926)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (11) Outreach and Assistance for Socially Disadvantaged 
         Farmers and Ranchers
       The House bill amends the outreach program for socially 
     disadvantaged farmers and

[[Page H1970]]

     ranchers contained in Sec. 2501 of the Food, Agriculture, 
     Conservation and Trade Act of 1990 by increasing the 
     authorization of appropriations from $10 million in each 
     fiscal year to $25 million and further explains assistance 
     and eligibility. (Sec. 927)
       The Senate amendment is similar except that subsection 
     (a)(5)(B) allows for interagency funding and subsection (b) 
     adds ``gender'' to the definition of ``Socially Disadvantaged 
     Group''. (Sec. 1054)
       The Conference substitute adopts the Senate language with 
     an amendment to strike the reference to ``gender,'' and 
     maintain eligibility for certain institutions. (Sec. 10707)
     (12) Reference to Sea Grass and Sea Oats as Crops Covered by 
         Noninsured Crop Disaster Assistance Program
       The House Bill amends Section 196(a)(2)(B) of the Federal 
     Agriculture Improvement and Reform Act of 1996 to include sea 
     oats and sea grass as crops covered by Noninsured Crop 
     Disaster Assistance Program. (Section 929)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. (Sec. 
     10101)
     (13) Operation of Graduate School of Department of 
         Agriculture
       The House bill requires that contracts entered into between 
     the USDA Graduate School and Federal agencies for 
     educational, training, and professional development 
     activities must be open to competitive bidding with the 
     private sector. (Sec. 930)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     an amendment striking section 1669 of the Food, Agriculture, 
     Conservation, and Trade Act of 1990, adding an audit 
     authority to section 921 of the Federal Agriculture 
     Improvement Reform Act of 1996, and delaying the effective 
     date of the amendment to October 1, 2002. (Sec. 10705)
     (14) Assistance for Livestock Producers
       The House bill authorizes, subject to appropriations, 
     assistance for livestock and dairy producers who have 
     suffered economic losses. (Sec. 931)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. (Sec. 
     10104)
     (15) Compliance With Buy American Act
       The House bill prevents the use of funds, under the Act, 
     from being used by any producer, person, or entity that does 
     not agree to comply with the Buy American Act in the 
     expenditure of such funds; expressed the Sense of Congress 
     that producers and other recipients of funds should, in 
     expending the funds, purchase only American-made equipment, 
     products, and services; and the directs Secretary to provide 
     to each recipient of funds a notice describing these 
     requirements. (Sec. 932)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (16) Report Regarding Genetically Engineered Foods
       The House bill instructs the Secretary, through the 
     National Academy of Sciences to complete and transmit a 
     report to Congress including the data and test needed to 
     assess human health risk from consumption of genetically 
     engineered foods; the types of monitoring systems that should 
     be created for future assessment; and a federal regulatory 
     structure to approve such foods as safe for human 
     consumption. (Sec. 933)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (17) Market Name for Pangasius Fish Species
       The House bill clarifies that the term catfish may not be 
     considered a common or usual name for the fish Pangasius 
     bocourti, or any other fish not classified within the family 
     Ictalariidae, including the importation of such fish pursuant 
     to section 801 of the Federal Food, Drug and Cosmetic Act. 
     (Section 934)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision with 
     amendment to clarify labeling restrictions of catfish 
     pursuant to the Federal Food, Drug and Cosmetic Act. (Sec. 
     10806)
     (18) Program of Public Education Regarding Use of 
         Biotechnology in Producing Food for Human Consumption
       The House bill instructs the Secretary to develop and 
     implement a program to communicate with the public regarding 
     the use of biotechnology in producing food for human 
     consumption, including science-based evidence of the safety 
     of such foods and the human outcomes of biotechnology used to 
     produce food for human consumption. (Sec. 935)
       The Senate amendment contains no comparable provision.
       The Conference substitute adopts the House provision. (Sec. 
     10802)
     (19) GAO Study
       The House bill instructs the Comptroller General to conduct 
     a study and make findings and recommendations with respect to 
     determining how producer income would be affected by updating 
     yield bases. The comptroller shall submit a report to 
     Congress not later than 6 months after the date of enactment. 
     (Sec. 936)
       The Senate amendment contained no comparable provision.
       The Conference substitute adopts the House provision. (Sec. 
     10903)
     (20) Interagency Task Force on Agricultural Competition
       The House Bill instructs the Secretary to, within 90 days 
     of enactment, establish an Interagency Task Force on 
     Agricultural Competition, consisting of 9 employees of the 
     Department of Agriculture and the Department of Justice. The 
     task force shall conduct hearings to review the lessening of 
     competition among purchases of livestock, poultry, and 
     unprocessed agricultural commodities. The task force shall 
     submit a report to the committee of Agriculture in both the 
     House and the Senate within 1 year after the last member of 
     the task force is appointed. (Sec. 937)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (21) Authorization for Additional Staff and Funding for the 
         Grain Inspection, Packers, and Stockyards Administration
       The House bill authorizes to be appropriated such sums as 
     are necessary to enhance the capability of GIPSA to monitor, 
     investigate, and pursue the competitive implications of 
     structural changes in the meat packing industry. Sums are 
     specifically earmarked to hire litigating attorneys to allow 
     GIPSA to more comprehensively and effectively pursue its 
     enforcement activities. (Sec. 938)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (22) Enforcement of the Humane Methods of Slaughter Act of 
         1958
       The House bill (1) added the following findings:
       Public demand for passage of P.L. 85-765;
       The Humane Method of Slaughter Act of 1958 requires that 
     animals be rendered insensible to pain when they are 
     slaughtered;
       Scientific evidence indicates that treating animals 
     humanely result in tangible economic benefits;
       The United States Animal Health Association passed a 
     resolution to encourage strong enforcement of the Act;
       The Secretary of Agriculture is responsible fore enforcing 
     the Act, including monitoring and compliance;
       (2) expressed the Sense of Congress that the Secretary 
     should fully enforce P.L. 85-765 by ensuring humane methods 
     in the slaughter of livestock; and (3) determined it is the 
     policy of the U.S. that the slaughter of livestock and 
     handling of livestock in connection with slaughter shall be 
     carried out only by humane methods, as proved by P.L. 85-765. 
     (Sec. 939)
       The Senate amendment provided for the same general intent 
     as the House provision, but with drafting differences. (Sec. 
     1067)
       The Conference substitute adopts the House provision with 
     an amendment eliminating Congressional findings. In Sec. 
     1067(1)(A) ``resume'' is changed to ``continue'' with regard 
     to the reporting requirement. The Managers expect the 
     Department to include a report on violations of this Act in 
     its annual report to Congress. (Sec. 10305)
     (23) Penalties and Foreign Commerce Provisions of the Animal 
         Welfare Act
       The House bill increased the penalties provided by current 
     law, by raising the maximum penalty for violation from $5,000 
     to $15,000 and raising the maximum imprisonment for violation 
     from 1 year to 2 years and also closes the ``foreign commerce 
     loophole'' by prohibiting transportation of animals for 
     fighting purposes from any state into any foreign country 
     effective 30 days after enactment. (Sec. 940)
       The Senate amendment is identical to the House provision. 
     (Sec. 1052)
       The Conference substitute also provides an amendment to 
     eliminate the increase in maximum prison terms found in the 
     House and Senate provision. (Sec. 10303)
     (24) Prohibition on Interstate Movement of Animals for Animal 
         Fighting
       The House bill amends Sec. 26(d) of the Animal Welfare Act 
     to prohibit the interstate shipment of birds for fighting 
     purposes. (Sec. 941)
       The Senate amendment is identical to the House provision. 
     (Sec. 1053)
       The Conference substitute made technical changes to make it 
     illegal ship a bird in interstate commerce for the purpose of 
     engaging in a animal fight and further, makes it illegal to 
     fight a bird in a fight in which any bird in the fight was 
     transported illegally. (Sec. 10302)
     (25) Renewable Energy Resources
       The House bill expands the purpose of the Environmental 
     Quality Incentives Program to include assistance to farmer 
     and ranchers for the assessment and development of their on-
     farm renewable resources, including biomass for production of 
     power and fuel, wind and solar. (Section 942a)
       The House bill also provides that the Secretary of 
     Agriculture, through the Cooperative State Research, 
     Education, and Extension Service and, to the extent 
     practicable, in collaboration with the Natural Resources 
     Conservation Service, regional biomass programs under the 
     Department of Energy, and other appropriate entities, may 
     provide education and technical assistance to farmers and 
     ranchers for the development and marketing of renewable 
     energy resources, including biomass for the production of 
     power

[[Page H1971]]

     and fuels, wind, solar, and geothermal. (Section 942b)
       The Senate amendment provides that the Secretary, acting 
     through the Cooperative State Research, Education, and 
     Extension Service in consultation with the Natural Resources 
     Conservation Service, regional biomass programs under the 
     Department of Energy, and other entities as appropriate, may 
     provide for education and technical assistance to farmers and 
     ranchers for the development and marketing of renewable 
     energy resources. The Secretary may retain up to 4 percent to 
     pay administrative expenses incurred in carrying out this 
     section. (Section 902)
       The Conference substitute deletes both the House and Senate 
     provisions.
       The Managers encourage the Cooperative State Research, 
     Education, and Extension Service to provide education and 
     technical assistance to agricultural producers for the 
     development of renewable energy resources. Such assistance 
     should enable producers to become more energy efficient and 
     provide for the development and marketing of renewable energy 
     resources. In assisting producers, the Cooperative Extension 
     Service may consult with other entities as appropriate.
     (26) Use of Amounts Provided for Fixed, Decoupled Payments to 
         Provide Necessary Funds for Rural Development Programs
       The House bill reduces the total amount payable under Sec. 
     104 (Fixed Decoupled Payments) of the Act on a pro rata 
     basis, so that the total amount of such reductions equals 
     $100,000,000, fiscal years 2002-2001.
       The House bill expends such sums as follows:
       (A) $45,000,000 for grants under 306A of the Consolidated 
     Farm and Rural Development Act (relating to the community 
     water assistance grant program);
       (B) $45,000,000 for grants under 613 of this Act (relating 
     to the pilot program for development and implementation of 
     strategic regional development plans); and(C) $10,000,000 for 
     grants under section 231(a)(1) of the Agricultural Risk 
     Protection Act of 2000 (relating to value-added agricultural 
     product market development grants). (Section 943)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (27) Country of Origin Labeling of Perishable Agricultural 
         Commodities
       The House bill amends the Perishable Agricultural 
     Commodities Act, 7 USC 499a, to mandate country of origin 
     labeling on all perishable agriculture commodities, including 
     both imported and domestically produced commodities by adding 
     the following sections:
       Sec. 18(a) A retailer of a perishable agricultural 
     commodity shall inform consumers, at the final point of sale 
     of the perishable agricultural commodity to consumers, of the 
     country of origin of the perishable agricultural commodity. 
     This applies to both imported and domestically produced 
     commodities.
       Sec. 18(b) Provides an exemption for the labeling 
     requirements for perishable agricultural commodities that are 
     prepared in a food establishment, sold or offered for sale at 
     the food service establishment in normal retail quantities 
     and served to consumers at the food service establishment.
       Sec 18(c) The information regarding the country of origin 
     may be provided to consumers via a label, stamp, mark, 
     placard, or other clear and visible sign on the perishable 
     agricultural commodity or on the package, display, holding 
     unit, or bin containing the commodity at the final point of 
     sale to consumers. A retailer is not required to provide any 
     additional information on a commodity that has already been 
     individually labeled with the country of origin by the 
     packer, importer, or other individual.
       USDA may assess Sec. 18(d) Civil penalties ($1,000 for the 
     first day the violation occurs; $250 for each day the 
     violation continues) against any retailer who fails to 
     indicate the country of origin.
       Sec. 18(e) Amounts collected under subsection (d) shall be 
     deposited in the Treasury.
       The House bill states the provision would take effect six 
     month following enactment. (Section 944)
       The Senate amendment amends the Agricultural Marketing Act 
     of 1946 (7 U.S.C. 1621 et seq.). Sec. 281 & Sec. 282(a)(1) 
     requires labeling for muscle cuts and ground beef, lamb and 
     pork as well as farm-raised fish and shellfish (including 
     steaks, nuggets and any other flesh from farmed raised fish 
     and shellfish) and produce as defined in the Perishable 
     Agricultural Commodities Act.
       Sec. 282(a)(2) Only those products that are exclusively 
     born, raised and slaughtered, hatched, raised, harvested, and 
     processed and produced in the U.S. may be designated as U.S. 
     country of origin.
       Sec 282(b) Subsection (a) shall not apply if the covered 
     commodity is prepared or served in a food service 
     establishment and offered for sale or sold at the food 
     service establishment in normal retail quantities or served 
     to consumers at the food service establishment.
       Sec. 282(c) The information regarding the country of origin 
     may be provided to consumers via a label, stamp, mark, 
     placard, or other clear and visible sign on the perishable 
     agricultural commodity or on the package, display, holding 
     unit, or bin containing the commodity at the final point of 
     sale to consumers.
       Sec. 282(d) Those who prepare, store, handle or distribute 
     a covered commodity shall maintain a verifiable record 
     keeping an audit trail.
       Sec. 282(e) Any person engaged in the business of supplying 
     a covered commodity to a retailer shall provide information 
     to the retailer indicating the country of origin of the 
     covered commodity.
       Sec. 282(f) The Secretary shall not establish a mandatory 
     identification system to verify the country of origin of a 
     covered commodity. Model certification programs the Secretary 
     can use for verification purposes include the carcass grading 
     system, voluntary country of origin beef labeling system, and 
     those systems used to carry out market access program under 
     the Agricultural Trade Act and the National School Lunch Act.
       Sec. 283 The Secretary of USDA will notify a retailer if a 
     violation is found, give the retailer 30 days to cure, 
     provide notice and an opportunity for a hearing and may fine 
     the retailer in an amount determined by the Secretary.
       Sec. 284 The Secretary may promulgate regulations and may 
     enter into partnerships with individual states for 
     enforcement purposes.
       Sec. 285 Takes effect 180 days following enactment. (Sec. 
     1001)
       The Conference substitute adopts the Senate language with 
     an amendment to provide for the implementation of two-years 
     of voluntary guidelines to precede mandatory labeling. The 
     exclusion from a covered commodity has been further defined 
     to include items that are an ingredient in a processed food 
     item. The conference substitute provides that animals trans-
     shipped from Alaska or Hawaii through Canada shall be 
     eligible to be designated as ``U.S. Country of Origin'' as 
     long as the period of trans-shipment does not exceed 60 days. 
     (Sec. 10506)
     (28) Unlawful Stockyard Practices Involving Nonambulatory 
         Livestock
       The House bill amends Title III of the Packers and 
     Stockyards Act, 1921 by adding following on Sec. 318:
       Sec. 318(a) defines the terms: humanely euthanize and 
     nonambulatory livestock.
       Sec. 318(b)(1) It shall be unlawful for any stockyard 
     owner, market agency, or dealer to buy, sell, give, receive, 
     transfer, market, hold, or drag any nonambulatory livestock 
     unless the nonambulatory livestock has been humanely 
     euthanized.
       Sec. 318(b)(2) provides exceptions.
       Sec. 318 (c) stipulates that the application of this 
     prohibition is to commence one year after enactment of the 
     Farm Security Act of 2001. The Secretary shall promulgate 
     regulations to carry out this section. (Sec. 945)
       The Senate amendment is a substantively identical provision 
     with the following difference: Sec. 318 (c) stipulates that 
     the application of this prohibition is to commence one year 
     after enactment of the Agriculture, Conservation, and Rural 
     Enhancement Act of 2002. (Sec. 1045)
       The Conference substitute adopts the House provision with 
     an amendment to require the Secretary to investigate the 
     problem of nonambulatory livestock and report the findings 
     to Congress. Based on the findings of the report the 
     Secretary shall promulgate regulations if the Secretary 
     deems them necessary to regulate the humane treatment, 
     handling and disposition of nonambulatory livestock. The 
     Conference substitute provides for investigative and 
     penalty authority consistent with the Animal Health 
     Protection Act. (Sec. 10502)
     (29) Annual Report on Imports of Beef and Pork
       The House bill requires the Secretary of Agriculture to 
     submit to Congress an annual report on the amount of beef and 
     pork that is imported into the U.S. each calendar year. (Sec. 
     946)
       The Senate amendment contains no comparable provision.
       The Conference substitute deletes the House provision.
     (30) Quality Grade Labeling of Imported Meat and Meat Food 
         Products
       The Senate amendment amends the Agricultural Marketing Act 
     of 1946 (7 U.S.C. 1621 et seq.):
       Sec. 291 defines the Secretary;
       Sec. 292 prevents an imported carcass, part thereof, meat, 
     or meat food product (as defined by the Secretary) from 
     bearing a quality grade label issued by the Secretary;
       Sec. 293 Secretary to promulgate regulations. (Sec. 1002)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (31) Continuous Coverage
       The Senate amendment amends Section 508(e)(4) of the 
     Federal Crop Insurance Act to impose a permanent prohibition 
     on the availability of continuous coverage. (Sec. 1012)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 10002)
     (32) Quality Loss Adjustment Procedures
       The Senate amendment amends Sec. 508(m) of the Federal Crop 
     Insurance Act to require the Federal Crop Insurance 
     Corporation to implement quality loss adjustment procedure 
     review recommendations effective for the 2003 reinsurance 
     year. (Sec. 1013)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to implement recommendations effective for the 
     2004

[[Page H1972]]

     reinsurance year and provides additional language to require 
     the Secretary, for purposes of quality loss adjustment under 
     the Federal crop insurance program, to allow certain 
     classifications of warehouse operators to make adjustments 
     for quality. Should the Secretary find that this provision 
     causes fraud and abuse of the Federal crop insurance program 
     by warehouse operators, the Managers intend for the Secretary 
     to take appropriate measures against those operators to 
     alleviate the problem. (Sec. 10003)
       It is the intent of the Managers that quality loss 
     adjustments reflect market discounts in the year of 
     adjustment. The term ``local'' outlined in Section 508(m) of 
     the Federal Crop Insurance Act may include discounts 
     determined based on regional surveys.
     (33) Conservation Requirements
       The Senate Amendment amends Section 1211(1) and Section 
     1221(b) of the Food Security Act of 1985 and Section 519(b) 
     of the Controlled Substances Act to prohibit the issuance of 
     an indemnity payment under the Federal Crop Insurance Act to 
     a producer who has planted on highly erodible land, converted 
     wetland, or has produced a controlled substance (Sec. 1014).
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (34) Animal Health Protection
       The Senate amendment provides for the consolidation and 
     updating of existing animal health authorities at USDA. (Sec. 
     1021 to Sec. 1038)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments 1) regarding the definition of disease 
     (S1023.CR10403) 2) requires notification to the Secretary of 
     Treasury as well as public notification regarding development 
     of rules on restrictions of imports (S1024. CR10404) 3) 
     directs the Secretary of Agriculture to consult with State 
     animal health officials and veterinary health professionals 
     regarding the establishment of the veterinary accreditation 
     program, gives guidelines for suspension or revocation of 
     accreditation of any veterinarian accredited under this 
     subtitle that violates this subtitle, and clarifies that the 
     criminal and civil penalties in section 1034 shall not apply 
     to violations of this section that are not violations of any 
     other provision of this subtitle (S1030. CR10410) 4) 
     establishes increased criminal penalties in cases of 
     violations of the Animal Health Protection Act involving 
     persons knowingly destroying records or moving pests in 
     commerce for distribution. Criminal penalties are likewise 
     increased in cases of persons who have committed multiple 
     violations of the Animal Health Protection Act. Strike the 
     provision of Section 1034 regarding criminal and civil 
     penalties relating to suspension or revocation of 
     accreditation. (S1034. CR10414) 5) authorization of 
     appropriations and to provide for more efficient management 
     of declarations of extraordinary emergencies and transfer of 
     funds from the Commodity Credit Corporation (S1037.CR 10417) 
     6) strikes the repeal of the Pseudorabies Eradication Program 
     which is reauthorized in the Conference substitute in Section 
     10507. (S1038. CR10418)
       The managers recognize that the principal purpose of the 
     Animal Health Protection Act is to protect against animal 
     disease. With this in mind, the managers have considered 
     numerous options with regard to a statutory definition of 
     disease. In considering these options, the managers were 
     concerned that an overly broad definition could result in 
     litigation forcing the Agency to divert scarce resources to 
     protecting against conditions which have little if anything 
     to do with the scientific understanding of disease. Likewise, 
     the managers were equally concerned that an arbitrarily 
     narrow definition would limit the ability of the Agency to 
     respond to as of yet unknown threats to animal health. The 
     managers have therefore concluded that in order for the 
     Agency to have maximum flexibility to focus it's resources 
     and respond to new or emerging disease threats that a 
     regulatory definition of disease should be left to the 
     discretion of the Secretary. In so doing, the managers 
     strongly encourage the Secretary to continually reexamine 
     the principal definitions developed during implementation 
     of this statute and make such changes as deemed necessary 
     to achieve the goal of protecting animal health.
       It is also the Managers intent that nothing in the Act 
     should be construed in a manner that will unduly restrict or 
     delay the importation, export, or transportation of 
     biomedical research materials, including tissues, specimens, 
     samples, animal embryos, or animals designated for use in 
     research. The Managers do not expect the Secretary to issue 
     any rule or regulation that would unduly restrict or delay 
     the importation, export, or transportation of biomedical 
     research materials, including tissues, specimens, samples, 
     animal embryos, or animals designated for use in research.
       It is the Managers understanding that Veterinary Services, 
     within the United States Department of Agriculture's Animal 
     and Plant Health Inspection Service (APHIS), has a long 
     history of cooperation with the veterinary community in 
     performing important regulatory work nationwide. Private 
     practitioners were first used to perform regulatory work in 
     1907. However, the current voluntary accreditation program 
     (National Veterinary Accreditation Program) officially began 
     in 1921, when USDA, Bureau of Animal Industry, administered 
     the first accreditation examination to certify practitioners 
     as representatives of the Federal government. Accredited 
     veterinarians are the backbone of U.S. regulatory programs 
     for livestock and poultry diseases. The overriding goal of 
     the National Veterinary Accreditation Program is for 
     Veterinary Services, veterinarians, State Animal Health 
     Officials and veterinary colleges to work cooperatively 
     toward the goal of protecting and improving the health, 
     quality, and marketability of U.S. animals. Increased 
     collaboration will be crucial to the success of new 
     enhancements to this program. It is the intent of the 
     Managers that APHIS' existing Veterinary Accreditation 
     Program and implementing regulations continue unimpeded 
     pursuant to section 1038 (c). With regard to future revisions 
     by APHIS to its Veterinary Accreditation Program, the 
     Managers strongly encourage APHIS' Veterinary Services to 
     consult with State animal health officials and veterinary 
     professionals, including State Veterinary Medical 
     Associations and private veterinary practitioners.
       The Managers note that USDA currently is evaluating three 
     rapid screening tests to determine which is the most 
     sensitive and effective at detecting scrapie. Ensuring proper 
     screening and testing, and, where necessary, the eradication 
     of animal diseases, is of paramount importance to American 
     Agriculture, USDA, the Congress, and the American people. 
     With the stakes to animal health and the farm economy so 
     high, the U.S. government should use the very best methods 
     available to detect animal diseases. Accordingly, the 
     Managers request that USDA use science-based criteria to 
     evaluate the tests under review and invite third-party animal 
     health diagnostic test experts to review preliminary findings 
     and evaluation methodology.
       The purpose of the Animal Health Protection Act is to 
     address pest and disease threats to animal health and 
     production. The managers do not intend for the Animal Health 
     Protection Act to be used to manage or control predation. The 
     Managers expect the Secretary of Agriculture to continue to 
     use the authorities under the Act of March 2, 1931 (7 U.S.C. 
     426-426b) as amended.
       In a case of extraordinary emergency, the section regarding 
     seizure, quarantine, and disposal provides express authority 
     in the Secretary to hold, seize, treat, and apply other 
     remedial actions to or destroy or otherwise dispose of any 
     animal. However, nothing in this section or in this title 
     should be construed as impliedly vesting in the Secretary 
     authority to manage fish or wildlife populations. If fish or 
     wildlife is affected by control or eradication measures 
     proposed by the Secretary in an extraordinary emergency, the 
     Managers expect that the Secretary will consult with 
     officials of the State agency having authority for protection 
     and management of such wildlife, as is the current practice 
     in such instances.
     (35) Pesticide Fees
       The Senate amendment (1) amends the FIFRA, with respect to 
     the pesticide registration maintenance fee system, to: (a) 
     make uniform the amount of the annual fee for each 
     registration; (b) set maximum amounts payable by a registrant 
     and an increased aggregate amount of collected fees; (c) 
     expand the definition of a small business; and (d) extend the 
     authority to collect such fees and the prohibition on levy of 
     fees other than those specified in the Act's fee provisions; 
     (2) extends the requirement that the Administrator use 
     maintenance fees to ensure expedited processing of similar 
     applications and adds a requirement that the fees be used to 
     review inert ingredients; (3) the Administrator the authority 
     to change current fee amounts by the same percentage as the 
     annual adjustment to the Federal General Schedule pay scale. 
     If fully implemented the total cost of the provision will be 
     $214 million over 4 years. (Sec.1041)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
       On June 9, 1999, EPA proposed a rule, ``Pesticides; 
     Tolerance Processing Fees Proposed Rule,'' 64 FR 31039, 
     Docket Number OPP-30115. EPA proposed to increase tolerance 
     fees dramatically and to collect fees retroactively back to 
     1996. The Managers question the legal basis and are concerned 
     about imposing fees retroactively and with the proposed level 
     of fees. Retroactive imposition of increased tolerance fees, 
     if imposed, could result in unnecessary loss of valuable 
     pesticide products for American farmers. The Managers 
     strongly encourage the EPA to withdraw its proposed tolerance 
     fee rule, and instead, work with the appropriate oversight 
     committees in the House of Representatives and the U.S. 
     Senate to develop comprehensive pesticide user fee 
     legislation.
       The Managers continue to be concerned that the 
     Administrator has yet to issue protocols for the issuance of 
     registrations for antimicrobials under the Food Quality 
     Protection Act. The Managers expect the Administrator to 
     expeditiously develop and implement these protocols. The 
     Managers further expect the Administrator to give full 
     consideration to an exemption under Sec. 25(b) of the Federal 
     Insecticide, Fungicide and Rodenticide Act (7 USC 136) for 
     antimicrobial products approved for use in food packaging 
     immediately before aseptic fill.
     (36) Pest Management in Schools
       The Senate amendment amends FIFRA to create a new section 
     33, ``School Environment Protection Act of 2002'' that 
     requires

[[Page H1973]]

     Pest Management in Schools. Requires states to develop pest 
     management plans as part of state cooperative enforcement 
     agreements with the EPA. Sets requirements for what should be 
     included in plans and requires the EPA to distribute 
     guidelines to states no later than one year after enactment, 
     after which State educational agencies would be required to 
     develop plans and submit them to the Administrator for 
     approval. Local education agencies would be required to 
     implement their state plan within one year of receiving 
     it. (Sec. 1042).
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (37) Packer Ownership
       The Senate amendment amends Section 202 of the Packers and 
     Stockyards Act of 1921 (7 U.S.C. 192(f)) (as amended by 
     section 1043(a)) by banning ownership or control of livestock 
     by a packer prior to 14 days before slaughter. An exemption 
     from the ban is provided for any packer that is a cooperative 
     entity with a majority ownership interest held by livestock 
     producers who own, feed or control their own livestock which 
     are provided to the cooperative for slaughter, or for any 
     packer who kills less than 2 percent of the total U.S. annual 
     slaughter for that type of livestock. In general, the ban 
     becomes effective upon enactment of the Act, but packers of 
     swine would not be required to complete livestock 
     divestitures until 18 months following the enactment of the 
     Act. For packers of any other type of livestock, the ban 
     would become effective no later than 180 days following 
     enactment of the Act. (Section 1043, amended by Sec. 1072 of 
     the Senate amendment below).
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
       The Managers recognize the importance of Congress holding 
     hearings to address issues affecting livestock producers, 
     such as agribusiness consolidation, and livestock marketing 
     issues.
     (38) Packers and Stockyards
       The Senate amendment (1) amends Section 2(a) of the Packers 
     and Stockyards Act by adding definitions of 'livestock 
     contractor', 'livestock production contract', and 'livestock 
     production contract grower'; (2) Amends sections 202, 203, 
     205, 204, 308, 401, and 403 of the P&S Act to include 
     ``livestock contractor'' as a covered entity under the P&S 
     Act; (3) adds new section 417 to the P&S Act that allows, 
     notwithstanding a provision of a livestock or poultry 
     contract, a party to the contract to discuss terms of the 
     contract with a legal advisor, a lender, an accountant, an 
     executive or manager, a landlord, a family member, or a 
     Federal or State agency with responsibility for enforcing a 
     statute designed to protect a party to the contract. (Sec. 
     1044)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that includes only swine production contractors 
     as a covered entity under the P&S Act. (Sec. 10503) The 
     amendment was rewritten so that the disclosure and preemption 
     provisions appear in Sec. 10504. This section clarifies that 
     people can discuss contracts with state & federal agencies 
     and certain other individuals. The language does not preempt 
     any state law that addresses confidentiality provisions in 
     contracts for the sale or production of livestock or poultry 
     except any provision of state law that makes lawful a 
     contract provision that prohibits a party from or limits a 
     party in engaging in a discussion that this section otherwise 
     requires to be permitted.
     (39) Arbitration Clauses
       The Senate amendment adds No Comparable Provision 413A to 
     the Packers and Stockyards Act that states that a person that 
     seeks to resolve a dispute in the contract may, 
     notwithstanding the terms of the contract, elect to arbitrate 
     the dispute in accordance with the contract; or resolve the 
     dispute in accordance any other lawful method of dispute 
     resolution, including mediation and civil action. (Sec. 1046)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (40) Cotton Classification Services
       The Senate amendment amends the first sentence of section 
     3a of the Act of March 3, 1927 (commonly known as the `Cotton 
     Statistics and Estimates Act') by striking `2002' and 
     inserting `2006'. (Sec. 1047)
       The House bill had an identical provision contained in the 
     Research Title. (Sec. 740)
       The Conference substitute adopts the Senate provision with 
     technical and clarifying amendments and extends the program 
     through 2007. (Sec. 10801)
     (41) Protection for Purchasers of Farm Products
       The Senate amendment (1) amends Section 1324 subsection 
     (c)(4)(B) of the Food Security Act of 1985 by striking 
     signed, and inserting signed, authorized, or otherwise 
     authenticated by the debtor and (2) amends subsection (c)(4) 
     by striking subsection (C); (2) amends subsection 
     (c)(4)(D)(iv) by striking applicable and all that follows and 
     inserting applicable, and the name of each county or parish 
     in which the farm products are growing or located;(3) 
     redesignates subparagraph numbering; (4) amends subsection 
     (e)(1)(A)(ii)(IV) by striking crop year, and all that follows 
     and inserting crop year, and the name of each county or 
     parish in which the farm products are growing or located;(5) 
     amends subsection (c)(4)(D)(iv) by inserting contains before 
     any payment;(6) the same changes are made in subsection 
     (g)(2)(A). (Sec. 1048)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 10604)
     (42) Improved Standards for the Care and Treatment of Certain 
         Animals
       The Senate amendment provides for the socialization of 
     puppies intended for sale as pets, and prohibits female dogs 
     from being bred before they are one year old, or from having 
     more than three litters every two years. The Act also 
     establishes a ``three strikes'' system for AWA licensees that 
     commit 3 or more serious violations of the Act over an eight-
     year period. (Sec. 1049)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (43) Farmers Market Promotion Program
       The Senate amendment (1) makes minor technical changes to 
     the Sec. 4 and Sec. 5 of the Farmer-to-Consumer Direct 
     Marketing Act of 1976; (2) amends Sec. 5 to include a 
     Development of Farmers Markets whereby the Secretary of 
     Agriculture will work to train managers of farmers markets, 
     develop opportunities to share information among managers of 
     farmers markets, develop a program to train extension 
     service employees in the development of direct marketing 
     techniques, and work with producers to develop farmers 
     markets; (3) amends the Farmer-to-Consumer Direct 
     Marketing Act of 1976 by adding Sec. 6 to establish the 
     Farmers' Market Promotion Program to make grants to 
     eligible entities to establish, expand and promote 
     farmers' markets. (Sec. 1050)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to make minor technical changes to Section 4 and 
     Section 5, only authorizes the new Section 6 of the Farmer-
     to-Consumer Direct Marketing Act of 1976, and further 
     prohibits the use of funds appropriated under this new 
     section for construction of buildings or structures. (Sec. 
     10605)
     (44) Definition of Animal under the Animal Welfare Act
       The Senate amendment amended the definition of animal to 
     add birds, rats, and mice bred for use in research to the 
     list of those animals excluded from coverage under the Animal 
     Welfare Act. (Sec. 1051)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 10301)
     (45) Wild Fish and Wild Shellfish
       The Senate amendment amends section 2104 of the Organic 
     Foods Production Act of 1990 by inserting a new subsection 
     (c) to provide, notwithstanding section 2107(a) (i.e., 
     notwithstanding the requirement that an organic product be 
     farm-raised), the Secretary may allow for certification and 
     labeling of wild fish and wild shellfish harvested from salt 
     water as organic, following a rulemaking. In doing this, The 
     Secretary is required to consult with the Secretary of 
     Commerce; the National Organics Standards Board; producers, 
     processors, and sellers; and interested members of the 
     public; and to the maximum extent practicable, the Secretary 
     is to accommodate the unique characteristics of the 
     industries in the United States that harvest and process wild 
     fish and wild shellfish. (Sec. 1055)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (46) Assistant Secretary of Agriculture for Civil Rights
       The Senate amendment directs the Secretary to establish 
     within USDA a position of Assistant Secretary of Agriculture 
     for Civil Rights. President shall appoint the Assistant 
     Secretary with the advice and consent of the Senate. Duties 
     include enforcing and coordinating compliance with all civil 
     rights laws; ensuring that USDA has measurable goals for fair 
     and nondiscriminatory treatment; compiling and disclosing 
     data used in assessing civil rights compliance in the 
     socially disadvantaged farmer program; holding USDA agency 
     heads and senior executives accountable for civil rights 
     compliance and assessing their performance; ensuring that 
     there is sufficient level of participation by socially 
     disadvantaged farmers and ranchers in deliberations of county 
     and area committees established under section 8(b) of the 
     Soil Conservation and Domestic Allotment Act and that 
     participation and election data are made publicly available. 
     (Sec. 1056)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that ensures the new Assistant Secretary of 
     Agriculture for Civil Rights is under the authority of the 
     Secretary of Agriculture. (Sec. 10704)
     (47) Transparency and Accountability for Socially 
         Disadvantaged Farmers and Ranchers; Public Disclosure 
         Requirements for County Committee Elections
       The Senate amendment:

[[Page H1974]]

       (1) Amends the Food, Agriculture, Conservation and Trade 
     Act of 1990 by inserting Sec. 2501A to ensure compilation and 
     disclosure of data to assess and hold the Department of 
     Agriculture accountable for the nondiscriminatory 
     participation of socially disadvantaged farmers and ranchers 
     in programs of the department;
       (2) Amends Section 8(b)(5) of the Soil Conservation and 
     Domestic Allotment Act by striking subparagraph (B) and 
     replacing it with a modified subparagraph (B), which in 
     addition to those things already required under current law: 
     Requires that each solicitation of nominations for, and 
     notice of elections of, a county, area, or local committee 
     shall include the nondiscrimination statement used by the 
     Secretary;
       (3) Sets forth procedure for the opening of ballots as 
     follows:
       At least 10 days before the date on which ballots are to be 
     opened and counted, a county, area, or local committee shall 
     announce the date, time, and place at which election ballots 
     will be opened and counted. Election ballots shall not be 
     opened until the date and time announced. Any person may 
     observe the opening and counting of the election ballots;
       (4) Requires that not later than 20 days after the date on 
     which an election is held, a county, area, or local committee 
     shall file an election report with the Secretary and the 
     State office of the Farm Service Agency;
       (5) Requires that not later than 90 days after the date of 
     the election, the Secretary shall complete a report that 
     consolidates all the election data reported to the Secretary;
       (6) Provides that, if after analyzing the election data it 
     is necessary, the Secretary shall promulgate proposed uniform 
     guidelines for conducting elections;
       (7) Provides that the term of office for a member of a 
     county, area, or local committee shall not exceed 3 years; 
     and
       (8) provides that the Secretary shall maintain and make 
     readily available to the public all the data required to be 
     collected under this section. (Sec. 1057)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     amendments to require the Secretary to report participation 
     rates of socially-disadvantaged farmers and ranchers by race, 
     ethnicity and gender and in those instances when socially-
     disadvantaged farmers or ranchers are not adequately 
     represented on a local or area committee, the Secretary may 
     appoint one additional voting member to the local or area 
     committee. (Sec. 10708)
     (48) Animal Terrorism Penalties
       The Senate amendment amends title 18 USC 43 to revise and 
     enhance criminal penalties and restitution for offenses 
     against animal enterprises. Subsection (a) of existing law 
     for offenses causing economic damages is revised to add a 6 
     month sentence and/or fines for offenses involving less than 
     $10,000 in economic damages and increases the penalty for 
     offenses causing more than $10,000 from one to three 
     years, plus retaining fines.
       Subsection (b) is revised to increase the penalty for 
     offenses causing serious bodily injury from 10 to 20 years, 
     plus adding the possibility of a fine, or both, and for an 
     offense causing death adding the possibility of a fine, or 
     both a fine and criminal penalty, to the existing law 
     penalties of life or a term of years.
       Subsection (c) is amended to allow restitution for ``any 
     other economic damage resulting from the offense''. (Sec. 
     1058)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (49) Pseudorabies Eradication Program
       The Senate amendment amends Section 2506(d) of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 by striking 
     `2002' and inserting `2006'. (Sec. 1059)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the Pseudorabies Eradication Program 
     to 2007. (Sec. 10507)
     (50) Transportation of Poultry and Other Animals
       The Senate amendment amends the FY 02 Treasury 
     Appropriations measure which provides a provision allowing 
     the Postal Service to require air carriers to accept as mail, 
     day old poultry if the air carrier allows the shipment of any 
     live animals as cargo. The Appropriations provision only 
     covers the period through June 30, 2002. The Senate provision 
     makes the provision in the Appropriations bill permanent. 
     (Sec. 1060)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to include honeybees. (Sec. 10501)
     (51) Emergency Grants to Low-Income, Migrant and Seasonal 
         Farm workers
       The Senate amendment amends Section 2281 of the Food, 
     Agriculture, Conservation, and Trade Act of 1990 by 
     specifying an authorization for appropriations at $40,000,000 
     for each fiscal year. (Sec. 1061)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to authorize such sums as are necessary. (Sec. 
     10102)
     (52) Preclearance Quarantine Inspections
       The Senate amendment adds a no comparable provision to the 
     FACT Act to require the APHIS to conduct preclearance 
     quarantine inspections at all direct departure and interline 
     airports of persons, baggage, cargo and other items destined 
     from Hawaii to the U.S. mainland, Guam, Puerto Rico, and the 
     U.S. Virgin Islands, but provides this provision shall not be 
     implemented unless the APHIS appropriation for inspection, 
     quarantine, and regulatory activities is increased by 
     $3,000,000 in a non-Agriculture FY 2002 appropriations act. 
     (Sec. 1063)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to authorize appropriations in fiscal year 2003. 
     (Sec. 10811)
     (53) Emergency Loans for Seed Producers
       The Senate amendment amended Section 253(b)(5)(B) of the 
     Agricultural Risk Protection Act of 2000 regarding loans to 
     seed producers who were unsecured creditors of a seed company 
     that filed for bankruptcy in 2000. The provision changed the 
     duration of these loans from 18 months to 54 months. (Sec 
     1064)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to change the duration of the loans from 18 
     months to 36 months. (Sec. 10103)
     (54) National Organic Certification Cost Share Program
       The Senate amendment directs the Secretary of Agriculture 
     (acting through the Agricultural Marketing Service) to use 
     $3,500,000 of Commodity Credit Corporation funds for each of 
     the fiscal years 2002 through 2004, and $3,000,000 for fiscal 
     year 2005 to establish a national organic certification cost-
     share program to assist producers and handlers of 
     agricultural products in obtaining certification under the 
     National Organic Production Program established under the 
     Organic Foods Production Act of 1990. Maximum federal cost 
     share is 75% and the maximum amount of a payment made to a 
     producer or handler under this provision shall be $500. (Sec. 
     1065)
       The House Bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment providing in fiscal year 2002, $5,000,000 to 
     remain available until expended to (in a cost-share manner) 
     assist producers and handlers of organic agricultural 
     products in obtaining certification under the National 
     Organic Production Program established under the Organic 
     Foods Production Act of 1990. (Sec. 10606)
       The Managers urge the Secretary to assist producers, 
     processors and firms interested in shifting production into 
     organic products in making this transition and, to the extent 
     possible, work to eliminate unnecessary, over burdensome and 
     any other barriers to this process. As soon as practicable, 
     the Secretary is urged to undertake a study to ascertain the 
     availability of key inputs into organic production, including 
     the availability of organically produced feedstuffs for the 
     organic production of livestock and poultry.
     (55) Food Safety Commission
       The Senate amendment establishes the Food Safety Commission 
     composed of 15 members from consumer groups; food processors, 
     producers, and retailers; public health professionals; food 
     inspectors; former or current food safety regulators; members 
     of academia; or any other interested individuals. The 
     Commission shall make specific recommendations that build on 
     and implement, to the maximum extent practicable, the 
     recommendations contained in the report of the National 
     Academy of Sciences entitled Ensuring Safe Food from 
     Production to Consumption and that shall serve as the basis 
     for draft legislative language to improve the food safety 
     system; improve public health; create a harmonized, central 
     framework for managing Federal food safety programs 
     (including outbreak management, standard-setting, inspection, 
     monitoring, surveillance, risk assessment, enforcement, 
     research, and education); enhance the effectiveness of 
     Federal food safety resources; and eliminate, to the maximum 
     extent practicable, gaps, conflicts, duplication, and 
     failures in the food safety system. Not later than 1 year 
     after the date on which the Commission first meets, the 
     Commission shall submit to the President and Congress a 
     comprehensive report.
       The Commission shall terminate on the date that is 60 days 
     after the date on which the Commission submits the 
     recommendations and report. (Sec. 1066)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment providing that members be appointed by the 
     President, changing the eligibility standards for appointees, 
     and requiring the Commission's recommendations to include 
     descriptions of how each would improve food safety. (Sec. 
     10807)
       The Managers expect that the Commission shall make 
     recommendations to improve public health, help create a 
     harmonized framework for managing Federal food safety 
     programs (including outbreak management, standard-setting, 
     inspection, monitoring, surveillance, risk assessment, 
     enforcement, research and education), and enhance the 
     effectiveness of Federal food safety resources

[[Page H1975]]

     (including the application of all resources based on risk, 
     including resources for inspection, research, enforcement, 
     and education).
       The recommendations should build on, to the maximum extent 
     practicable, the recommendations contained in the report of 
     the National Academy of Sciences entitled `Ensuring Safe Food 
     from Production to Consumption'.
     (56) Penalties for Violations of Plant Protection Act
       The Senate amendment amends criminal penalty provisions of 
     the Plant Protection Act (7 U.S.C. 7734) to include felony 
     and misdemeanor penalties. Violations involving plant pests, 
     more than 50 pounds of plants, more than 5 pounds of plant 
     products, more than 50 pounds of noxious weeds, possession 
     with the intent to distribute items known to be in violation 
     of this Act, or any fraud involving official documents issued 
     under this act shall be subject to felony penalties (not more 
     than 5 years imprisonment and/or not more than $25000 fine). 
     Misdemeanor penalties (not more than 1 year imprisonment and/
     or not more than $1000 fine) for violations involving less 
     than 50 pounds of plants, less than 5 pounds of plant 
     products, or less than 50 pounds of noxious weeds. Felony and 
     misdemeanor penalty limits are increased for second and 
     subsequent violations. Violations involving intent to harm 
     U.S. agriculture would be subject to not less than 10 years, 
     nor more than 20 years imprisonments and/or a fine not to 
     exceed $500,000. Finally, additional sections are added 
     authorizing criminal and civil forfeiture for violations 
     other than misdemeanors. (Sec. 1068)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to establish increased criminal penalties in 
     cases of violations of the Plant Protection Act involving 
     persons knowingly destroying records or moving pests in 
     commerce for distribution. Criminal penalties are likewise 
     increased in cases of persons who have committed multiple 
     violations of the Plant Protection Act. (Sec. 10810)
       The Managers encourage the Secretary to consider the need 
     for the post-harvest treatment of imported and domestic 
     agricultural products, and for untreated agricultural 
     products moving into or through the United States, for fruit 
     flies and other plant pests and diseases to improve the 
     protection of domestic crops from plant pests and diseases. 
     Such facilities could be located in ports of entry on the 
     border between the United States and Mexico from Nogales, 
     Arizona to Galveston, Texas as well as in Wilmington, North 
     Carolina, Atlanta, Georgia, Gulfport, Mississippi, and 
     Seattle, Washington.
     (57) Connecticut River Atlantic Salmon Commission
       The Senate amendment changes the effective period of the 
     Connecticut River Atlantic Salmon Commission from 20 to 40 
     years and authorizes $9,000,000 for each of fiscal years 2002 
     through 2010 to the Secretary of the Interior to carry out 
     the activities of the Connecticut River Atlantic Salmon 
     Commission. (Sec. 1069)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to extend the compact and strike the 
     authorization of appropriations. (Sec. 10812)
     (58) Bear Protection
       The Senate amendment prohibits movement in interstate or 
     foreign commerce of bear viscera--defined as the body fluids 
     and organs, not including blood or brains, of any species of 
     bear. Exceptions are made for wildlife law enforcement 
     purposes, and nothing in this section affects state 
     regulation of bear populations or any hunting of bears 
     allowed under state law and establishes civil and criminal 
     penalties for violations. (Sec. 1070)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (59) Family Farmer Bankruptcy Provisions
       The Senate amendment makes permanent Chapter 12 of the 
     bankruptcy code effective, October 1, 2001, the date on which 
     the section lapsed. Chapter 12 covers bankruptcies where the 
     total debts can be no more than $1.5 million, where 50% of 
     the income and 80% of the debts are farm related. (Sec. 1071)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to extend Chapter 12 Bankruptcy through December 
     31, 2002. (Sec. 10814)
     (60) Packer Ownership
       The Senate amendment adds a new subsection to the Packers 
     and Stockyards Act that prohibits meatpackers from owning or 
     feeding livestock directly, through a subsidiary, or through 
     an arrangement that gives the packer operational, managerial, 
     or supervisory control over the livestock, or over the 
     farming operation that produces the livestock, to such an 
     extent that the producer is no longer materially 
     participating in the management of the operation with respect 
     to the production of the livestock.
       Exempts from prohibition:
       1. Arrangements entered into within 14 days before 
     slaughter;
       2. A cooperative or entity owned by a cooperative, if a 
     majority of the ownership interest in the coop is held by 
     active coop members that own, feed, or control livestock and 
     provide the livestock to the coop; and
       3. A packer that is owned by producers of a type of 
     livestock, if during a calendar year the packer slaughters 
     less than 2 percent of the head of that type of livestock in 
     the U.S. (Sec. 1072 which amends Sec. 1043)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (61) Hass Avocados
       The Senate amendment (1) amends Section 1205 to require the 
     Secretary to revisit the issue of seat allocation on the 
     board; (2) amends subsection (h)(1)(C)(iii) by allowing 
     importers to pay the assessment ``not less than 30 days after 
     the avocado clears customs, unless deemed not feasible as 
     determined by the Commissioner of Customs and the 
     Secretary''. (Sec. 1073)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (62) Social Security Surplus Funds
       The Senate amendment expresses the Sense of the Senate 
     regarding social Security; that no social security surplus 
     funds should be used to make currently scheduled tax cuts 
     permanent or for wasteful spending. (Sec. 1074)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (63) Repeal of Estate Taxes
       The Senate amendment expresses the Sense of the Senate that 
     the repeal of the estate tax should be made permanent by 
     eliminating the sunset provision's applicability to the 
     estate tax. That estate tax provision expires on Dec 31, 
     2010. (Sec. 1075)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (64) Commercial Fisheries Failure
       The Senate amendment permanently revokes Northeast U.S. 
     multi-species fishing permits using a ``reverse auction,'' 
     method, a method developed to remove the maximum amount of 
     capacity from the fishery at the lowest possible price to the 
     taxpayers. The goal is to reduce the total number of days 
     multi-species fishing is allowed in certain areas off the New 
     England coast because of depletion of key fish species. $10 
     million is provided in CCC funds for the purpose; USDA with 
     consultation with the Department of Commerce would administer 
     the program. The provision provides for expedited procedures 
     under an existing rule but does not prevent alternative rules 
     if developed. The provision remains in effect for 1 year. 
     (Sec. 1076)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to authorize such sums as necessary. (Sec. 
     10107)
     (65) State Meat Inspection Programs
       The Senate amendment (1) requires the Secretary not later 
     than September 30, 2003, to conduct a comprehensive review of 
     each State meat and poultry inspection program, to include--
       An analysis of the effectiveness of the State program;
       Identification of changes necessary to enable the possible 
     transformation of the State program to a State program that 
     includes the mandatory requirements of the Federal Meat 
     Inspection Act and the Poultry Products Inspection Act;
       (2) Requires the Secretary to obtain comment from 
     interested parties in carrying out the review and authorizes 
     appropriations. (Sec. 1077)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
       The Managers recognize that it is the policy of Congress to 
     ensure that consumers continue to have access to a safe, 
     wholesome, abundant and affordable supply of meat and meat 
     food products. The Managers further believe the goal of 
     providing a safe, wholesome, abundant and affordable supply 
     of meat and meat food products throughout the United States 
     is achieved, in part, through the role played by both State 
     and Federal food safety inspection systems. The State and 
     Federal meat inspection programs should continue to function 
     together to create an inspection system that ensures food 
     safety and increases consumer confidence in the food supply 
     in both intrastate and interstate commerce. The Managers 
     recognize that these goals cannot be met in the absence of 
     viable State meat inspection programs that help to foster the 
     participation of smaller establishments in the food 
     production economy. Therefore, the Managers intend that when 
     the Secretary of Agriculture submits the annual report to 
     Congress on the activities of the Food Safety Inspection 
     Service, the Secretary should include a full review of State 
     inspection systems. This review should also offer guidance 
     about changes the State systems might expect should the 
     statutory prohibition against the interstate shipment of 
     state inspected product be removed.
     (66) Agricultural Research and Technology
       The Senate amendment authorizes such sums as necessary from 
     2002 through 2006 for (1) studies on the transmission of 
     spongiform

[[Page H1976]]

     encephalopathy in deer, elk, and moose and chronic wasting 
     disease with results to be reported to the Ag Committees; (2) 
     a research and extension grants program to develop prevention 
     and control methodologies for infectious animal diseases of 
     livestock and laboratory tests to expedite detection of 
     infected livestock and presence of disease in herds or 
     flocks; (3) a vaccine storage study to determine how much 
     vaccine is needed, how much is available, and directing the 
     Secretary to take action to correct any identified shortfall; 
     and (4) a program of veterinary training to retain sufficient 
     capacity of State and Federal vets in all regions well-
     trained in recognition and diagnosis of exotic and endemic 
     animal diseases. (Sec. 1078)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to provide additional discretion to the 
     Secretary with regard to implementation of the program and 
     authorize the program through 2007. The research and 
     extension grant program for livestock production is deleted. 
     A new research and extension grant program for livestock 
     production is established within the High Priority Research 
     and Extension grants program [See Sec. 7208]. (Sec. 10907)
     (67) Office of Science Technology Policy
       The Senate amendment authorizes the President to establish 
     an SES position in the Office of Science and Technology 
     Policy for a Veterinary Advisor. (Sec. 1079)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
       The U.S. Department of Agriculture holds primary 
     responsibility for preventing, monitoring and responding to 
     outbreaks of diseases that affect livestock and other 
     animals used for agricultural purposes. Recent experiences 
     in Europe with Bovine Spongiform Encephalopathy and with 
     Foot and Mouth Disease, however, demonstrate that the 
     technical expertise of other federal agencies will also be 
     required if a similar outbreak ever erupts in the United 
     States.
       The Managers are aware of successful efforts by the White 
     House Office of Science and Technology Policy (OSTP) to pull 
     together and draw upon the scientific and technical expertise 
     of experts from across the federal government to evaluate 
     solutions to emerging problems. When these or similar 
     problems arise, the Managers expect that OSTP will draw 
     heavily upon the expertise of veterinarians to provide 
     similar leadership to facilitate multi-agency efforts to 
     prevent, detect, and respond to outbreaks of animal diseases.
     (68) Operation of Agricultural and Natural Resource Programs 
         on Tribal Lands
       The Senate amendment requires the Secretary of Agriculture 
     with consultation of the Secretary of the Interior, to 
     conduct a review on tribal and trust land. The review will 
     address natural resource management programs, incentive 
     programs and farm income support programs. The report will 
     contain a plan to carry out actions found in this section and 
     shall be submitted to Congress not later than 1 year after 
     the date of enactment of this Act. (Sec 1079A)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate language with 
     an amendment to include a report in consultation with the 
     Secretary of the Interior and clarify that the report will 
     apply to commodity supports, natural resource, credit and 
     forestry programs. (Sec. 10910)
     (69) Geographically Disadvantaged Farmers
       The Senate amendment, Subsection (a), (1) provides a 
     definition of eligible entity, which includes community-based 
     organizations with experience in serving geographically 
     disadvantaged farmers, land-grant colleges, and national 
     tribal organizations that have experience in serving 
     geographically disadvantaged farmers; (2) defines 
     geographically disadvantaged farmer as one in an insular area 
     (as defined in 7 U.S.C. 3103); (3) requires the Secretary to 
     carry out an assistance program to encourage and assist 
     geographically disadvantaged farmers in owning and operating 
     farms and participating equitably in USDA programs; (4) 
     provides Secretary authority to make grants and enter into 
     contracts with eligible entities to provide information and 
     technical assistance; and (5) authorizes $10,000,000 each 
     year to carry out the program. (Sec. 1079B)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate language with 
     an amendment to require a report describing how to improve 
     geographically disadvantaged farmers' participation in USDA 
     programs. (Sec. 10906)
     (70) Naming Ginseng
       The Senate amendment expresses the Sense of the Senate that 
     the Commissioner of FDA should promulgate regulations to 
     ensure that the name ``ginseng'' or any name that includes 
     the word ``ginseng'' shall be used in reference to an herb or 
     herbal ingredient that is part of the plant of one of the 
     species of the genus Panax and is produced in compliance with 
     U.S. law regarding the use of pesticides (Sec. 1079C).
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that the term ``ginseng'' may not be considered 
     to be a common or usual name for any herb or herbal 
     ingredient not derived from a plant classified within the 
     genus Panax, including with respect to importation under 
     section 801 of the Federal Food, Drug, and Cosmetic Act. 
     (Sec. 10806)
     (71) Adjusted Gross Revenue Insurance Pilot Program
       The Senate Amendment amends Section 523 of the Federal Crop 
     Insurance Act to require the Federal Crop Insurance 
     Corporation to expand for the 2003 reinsurance year the 
     Adjusted Gross Revenue Insurance Pilot Program into at least 
     8 counties in the State that produces the highest quantity of 
     specialty crops for which adjusted gross revenue insurance is 
     not available. The language requires the Corporation to 
     include those counties that produce a significant quantity of 
     specialty crops (Sec. 1079D).
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to expand the Adjusted Gross Revenue Insurance 
     Pilot Program for the 2003 reinsurance year to at least 8 
     counties in the State of California and at least 8 counties 
     in the State of Pennsylvania. The substitute language 
     requires the Corporation to work with the respective State 
     Departments of Agriculture to establish criteria to determine 
     which counties to include in the pilot program. (Sec. 10004)
     (72) Report on Specialty Crop Insurance
       The Senate Amendment amends Section 522(e) of the Federal 
     Crop Insurance Act to provide additional mandatory funding to 
     reimbursements made available under research and development; 
     amends Section 524(a)(4) of the Federal Crop Insurance Act to 
     provide additional mandatory funding to education and 
     information programs established under paragraph (2) of that 
     section; provides that the Secretary of Agriculture shall 
     submit to the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate a report that describes the 
     progress made by the Corporation in research and development 
     of innovative risk management products to include cost of 
     production insurance that provides coverage for various 
     crops, the progress made by the Corporation in increasing the 
     use of risk management products offered through the 
     Corporation by producers of specialty crops, by small- and 
     moderate-sized farms, and in areas that are underserved, as 
     determined by the Secretary, and how the additional funding 
     provided under the amendments made by the section has been 
     used. (Sec. 169(h)(3))
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision 
     pertaining only to the report with commensurate changes. The 
     Senate language amending Section 522(e) and Section 524(a)(4) 
     of the Federal Crop Insurance Act is deleted. (Sec. 10006)
       The Managers expect the Federal Crop Insurance Corporation 
     to fully utilize contracting allocations for research and 
     development of policies in underserved states under Section 
     522(e)(2)(B) of the Federal Crop Insurance Act.
       The Managers urge the Federal Crop Insurance Corporation to 
     consider expanding its contract for research and development 
     of a cost of production policy in order to cover as many 
     commodities as is practicable. The Managers recognize the 
     attraction of the cost of production plan currently under 
     development and recommend that the current list of 12 crops 
     be expanded over the next several years to include but not be 
     limited to: alfalfa, apples, asparagus, avocados, bananas, 
     barley, beans, beets, blueberries, boysenberries, broccoli, 
     cabbage, canola, cantaloupes, carrots, cauliflower, celery, 
     cherries, chicory, Christmas trees, coffee, cucumbers, dry 
     beans, eggplant, escarole, flaxseed, floriculture, forest 
     products, garlic, grain sorghum, grapefruit, grapes, guava, 
     guar, grass seed, greenhouse and nursery agricultural 
     commodities, hay, herbs, honeydew melons, lemons, lettuce, 
     lima beans, limes, loganberries, maple, mango, mushrooms, 
     mustard greens, okra, olives, oranges, papaya, peanuts, peas, 
     pears, pecans, peppers, plums, pineapple, pistachios, 
     potatoes, prunes, pumpkins, raspberries, rye, safflower, 
     spinach, squash, strawberries, sugar beets, sunflower, sweet 
     corn, sweet potatoes, tangerines, tangelos, tobacco, 
     tomatoes, walnuts, and watermelons.
       The Managers recognize that there are several types of 
     innovative insurance plans, such as whole farm revenue 
     insurance, which have the potential to help farmers better 
     manage the risks associated with agricultural production. 
     Whether whole farm revenue insurance, commodity-specific cost 
     of production plans, or other innovative approaches, the 
     Managers encourage the development of actuarially sound 
     policies that do not distort markets and that keep moral 
     hazard and adverse selection problems to a minimum.
     (73) Pasteurization
       The Senate amendment provides a common definition of 
     pasteurization for ``any provision of federal law under which 
     a food or food product is required to undergo a treatment of 
     pasteurization'' which means ``any safe treatment that--
       (1) Is a treatment prescribed as pasteurization applicable 
     to the food or food product under any Federal law (including 
     regulation); or
       (2) Has been determined to the satisfaction of the 
     Secretary of HHS to achieve a level of reduction in the food 
     or food product of the

[[Page H1977]]

     microorganisms of public health concern that--
       (A) Is at least as protective of the public health as a 
     treatment described in paragraph (1); and
       (B) Is effective for a period that is at least as long as 
     the shelf life of the food or food product when stored under 
     normal, moderate, and severe abuse conditions''. (Sec. 1079E)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment that clarifies the Food and Drug Administration 
     approval process for claims of pasteurization. FDA is 
     directed to revise as appropriate its existing regulation 
     covering the labeling of foods. Pending the completion of 
     such a review, such authorization is provided for any person 
     to seek FDA approval of an irradiation-labeling claim. (Sec. 
     10808)
       The Managers have included a provision to require the 
     Secretary of Health and Human Services to complete a 
     rulemaking to review current Food and Drug Administration 
     requirements for the labeling of irradiated foods. Since 
     1997, Congress has repeatedly urged the performance of such a 
     review to ensure that any required disclosure statement in 
     the labeling of irradiated foods should ``be of a type and 
     character such that it would not be perceived to be a warning 
     or give rise to inappropriate consumer anxiety.'' House 
     Conference Report No. 105-399, U.S. Code Congr. & Admin. News 
     1997, pp. 2,888-89. Pending completion of the rulemaking 
     required by this provision, any person may petition the 
     Secretary regarding the adequacy of proposed labeling for a 
     particular irradiated food so that the person may receive 
     from the Secretary a determination as to whether labeling 
     inconsistent with current regulatory requirements is truthful 
     and non-misleading and, therefore, permissible. If such 
     petition is neither approved nor denied within 180 days of 
     receipt (unless the petitioner and the Secretary mutually 
     agree to extend this time frame), the petition will be deemed 
     denied and the denial will constitute final agency action 
     subject to judicial review.
       The Managers have included a provision to facilitate the 
     use of effective food safety technologies. Specifically, an 
     amendment to Section 403 of the Federal Food, Drug, and 
     Cosmetic Act is included to recognize that the term 
     ``pasteurization'' or ``pasteurized'' may be uniformly used 
     to advise consumers that a treatment or process, including a 
     series of treatments or controls, may be used if it achieves 
     the same food safety effect as currently recognized 
     pasteurization methods. The intent of this provision is to 
     make explicit that the term ``pasteurization'' is available 
     to describe a food safety effect, regardless of the 
     technology or process employed to achieve that result. 
     Currently, regulations regarding milk and egg products 
     recognize that technologies other than thermal treatment may 
     achieve a food safety effect equivalent to pasteurization 
     and, therefore, employ the term in product labeling. This 
     provision provides for FDA to receive pre-market notification 
     of the basis for use of this provision. Enactment of this 
     provision should not be construed as a basis for regulatory 
     action against any products that have borne the term 
     ``pasteurization'' in a truthful and non-misleading manner 
     prior to enactment of the provision or bear the term 
     ``pasteurization'' under other authority. Further, nothing in 
     this provision mandates that products not required to be 
     labeled, as ``pasteurized'' presently is required to be 
     labeled as ``pasteurized'' solely for the fact that they 
     could be labeled as ``pasteurized'' under this provision.
       The Managers encourage the Secretary in consultation with 
     the Secretary of Health and Human Services, to pursue a 
     comparable pasteurization labeling program for meat and 
     poultry products. Such labeling could allow use of the 
     termpasteurization for meat and poultry products treated by 
     similar processing technologies such as irradiation.
     (74) Report on Pouched and Canned Salmon
       The Senate amendment requires the Secretary not later than 
     120 days after enactment to submit to Congress a report on 
     efforts to expand the promotion, marketing, and purchasing of 
     pouched and canned salmon harvested and processed in the U.S. 
     under food and nutrition programs administered by the 
     Secretary. (Sec. 1081)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to increase the required amount of time for the 
     report to be completed from 120 to 180 days. (Sec. 10902)
     (75) Tobacco Settlement Agreement Report
       The Senate amendment requires the Comptroller General of 
     the U.S. to submit to Congress not later than December 31, 
     2002 and annually thereafter through 2006, a report that 
     describes all programs and activities that States have 
     carried out using funds received under all phases of the 
     Master Settlement Agreement of 1997. (Sec. 1082)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision. 
     (Sec. 10908)
     (76) Report on GM Pest Protected Plants
       The Senate amendment requires the Secretary to report to 
     the House and Senate Agriculture Committees within 90 days of 
     enactment on the actions taken by USDA to implement 
     recommendations made by the Committee on Genetically Modified 
     Pest-Protected Plants of the Board on Agriculture and Natural 
     Resources of the National Research Council in 2000 regarding 
     food safety, ecological research, and monitoring needs for 
     transgenic crops with plant incorporated protectants; and 
     regarding enhancements to certain operational aspects of the 
     regulatory framework for agricultural biotechnology, 
     including improving coordination and enhanced consistency of 
     review across regulatory agencies and clarifying the 
     regulatory jurisdiction of APHIS. (Sec. 1083)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment accepting the Sense of the Congress provision of 
     Senate Sec. 1083 and dropping remaining provisions. (Sec. 
     7410)
     (77) Study of Creation of Litter Bank by University of 
         Arkansas
       The Senate amendment directs the Secretary to conduct a 
     study to evaluate the creation of a litter bank by USDA at 
     the University of Arkansas for the purpose of enhancing 
     health and viability of watersheds in areas with large 
     concentrations of animal producing units and report the 
     results of the study to Congress. (Sec. 1084)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment changing the reference from ``litter bank'' to 
     ``nutrient banking,'' deleting any reference to a particular 
     institution, and providing the Secretary with discretion to 
     carry out a study under this section. (Sec. 7411)
     (78) Study of Feasibility of Producer Indemnification from 
         Government-Caused Disasters
       The Senate Amendment requires the Secretary of Agriculture 
     to conduct a study of the feasibility of expanding 
     eligibility for crop insurance under the Federal Crop 
     Insurance Act and noninsured crop assistance under section 
     196 of the Federal Agriculture Improvement and Reform Act of 
     1996 to agricultural producers experiencing disaster 
     conditions caused primarily by Federal agency action. (Sec. 
     1085)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to clarify that the feasibility study shall 
     focus on disaster conditions caused by Federal agency action 
     restricting access to irrigation water, including any lack of 
     access to an adequate supply of water caused by failure by 
     the Secretary of the Interior to fulfill a contract in 
     accordance with the Central Valley Project Improvement Act. 
     (Sec. 10108)
       The Managers expect the study to include losses to farmers 
     due to regulatory actions or inactions, which result in 
     failure to meet water delivery targets as specified under the 
     Calfed Record of Decision for agriculture service contractors 
     who receive water from the Central Valley Project.
     (79) Report on the Sale and Use of Pesticides for 
         Agricultural Uses
       The Senate amendment directs the Administrator to submit to 
     Congress a report on the manner in which the Agency is 
     applying regulations of the Agency governing the sale and use 
     of pesticides for agricultural use to electronic 
     transactions. (Sec. 1086)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to increase the required amount of time for the 
     report to be completed from 120 to 180 days. (Sec. 10909)
     (80) Report on Birds, Rats and Mice
       The Senate amendment requires a GAO report on the 
     implications of including birds, rats, and mice in the 
     definition of ``animal'' under USDA's regulations under the 
     Animal Welfare Act. (Sec. 1087)
       The House bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment for the National Research Council to submit this 
     report to Congress. The report shall be completed with input 
     from the Secretary of Agriculture, the Secretary of Health 
     and Human Services and the Institute for Animal Laboratory 
     Research. It shall contain an estimate of the number and 
     types of entities that use rats, mice and birds for research 
     purposes, and a description of the regulations to which these 
     are subjected. It shall also contain an estimate of the rats, 
     mice and birds used in research facilities and an indication 
     of which of those facilities are currently under federal 
     regulation. Further, the report shall include an estimate of 
     the additional costs likely to be incurred by researchers 
     resulting from additional regulations, recommendations for 
     minimizing such costs, an estimate of the additional funding 
     APHIS would require to ensure compliance, and recommendations 
     for minimizing the regulatory burden on facilities already 
     subject to federal regulations. (Sec. 10304)
     (81) Task Force on National Institutes for Plant and Animal 
         Sciences
       The Senate amendment requires the Secretary not later than 
     90 days after enactment to establish a task force of 8 
     members (6 of them private or academic sector) to study 
     review and evaluate publicly funded agricultural research 
     activities and consider the merits of establishing 1 or more 
     National Institutes for Plant and Agricultural Sciences 
     similar to NIH. (Sec. 1088)

[[Page H1978]]

       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (82) Organic Products Promotion
       The Senate Amendment authorizes the establishment of a new 
     organic research and promotion check off program, which must 
     be proposed and approved by a majority of certified organic 
     producers and handlers. This provision is designed to 
     facilitate the establishment of one order covering a category 
     of products (organic products) rather than individual 
     commodities, requires that the composition of the check 
     off board must reflect both regional distribution and 
     differing scales of organic production, and requires the 
     Secretary to conduct a referendum on whether the order 
     should continue at least once every four years. 
     Assessments under an order established under this 
     provision would be voluntary (at the option of individual 
     farmers). To avoid having farmers paying more than one 
     check off assessment, the provision provides that 
     producers choosing to contribute to the organic order 
     would be entitled to a credit against assessments under 
     another order. (Sec. 1091-1098G)
       The House Bill contains no comparable provision.
       The Conference substitute adopts the Senate provision with 
     an amendment to allow a person that produces and markets only 
     100% organic products and does not produce any conventional 
     or non-organic products, to be exempt from the payment of an 
     assessment under a commodity promotion law with respect to 
     any agricultural commodity that is produced on a certified 
     organic farm. The Secretary shall promulgate regulations, not 
     later than one year after the date of enactment of this Act, 
     regarding eligibility and compliance for such an exemption. 
     (Sec. 10607)
     (83) Effect of Amendments
       The Senate amendment provides that amendments made by the 
     Act do not affect Secretarial authority to carry out current 
     price support or production adjustment programs as in effect 
     before the date of enactment. (Sec. 1099A)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate amendment.
     (84) CCC Funding
       The Senate amendment specifies that notwithstanding any 
     other provision of the bill, any funds made available under 
     the bill will be made available through the Commodity Credit 
     Corporation. (Sec. 1099B)
       The House bill contains no comparable provision.
       The Conference substitute deletes the Senate provision.
     (85) Implementation Funding and Information Management
       The Conference Substitute provides $55 million for 
     administrative costs associated with the implementation of 
     Title I. Of that amount, not less than $5 million nor more 
     than $8 million is to be available for the development of a 
     comprehensive information management system for programs 
     operated by the Farm Service Agency and the Federal Crop 
     Insurance Corporation. The Conference Substitute requires 
     that the Secretary enter into agreements or contracts with 
     outside entities to development information management 
     system. The Conference Substitute also provides that the new 
     requirements shall not interfere with or delay existing 
     agreements or requests for proposals of the agencies 
     regarding data mining or data warehousing. Such sums as may 
     be necessary are authorized to be appropriated for each of 
     fiscal years 2003 through 2008. (Sec. 10706)
       The Managers continue to be concerned about the lack of 
     information sharing and progress toward a common information 
     management system for the service agencies of the Department. 
     The Managers believe that integrating information management 
     systems at USDA will reduce the waste associated with the 
     maintenance of duplicative systems and allow the agencies to 
     operate more effectively and efficiently to the benefit of 
     agricultural producers.
       In the Agricultural Risk Protection Act of 2000 (ARPA), the 
     Farm Service Agency (FSA) and the Federal Crop Insurance 
     Corporation (Corporation) were required to reconcile producer 
     information. FSA and the Corporation serve the same producers 
     with commodity and crop insurance programs, respectively; it 
     is logical that both agencies should use a common information 
     management system so that the collection of data is not 
     duplicated, the integrity of the data collected is improved 
     and, most importantly, customer service to producers is 
     enhanced. The Managers believe that the development of a 
     common information management system for FSA and the 
     Corporation will demonstrate substantial efficiencies and 
     serve as a first step toward broader, Department-wide 
     integration. Valuable groundwork will be laid for further 
     modernization of information technology systems of USDA 
     agencies in the future, and for the incorporation of those 
     systems into that developed for FSA and the Corporation.
       The Managers commend the work being done at the Center for 
     Agribusiness Excellence at Tarleton State University in 
     cooperation with the Corporation on crop insurance compliance 
     as directed by ARPA. It is the expectation of the Managers 
     that the Secretary of Agriculture will build upon the work 
     currently being conducted at the Center for Agribusiness 
     Excellence and through further contracting with the Center to 
     develop the information management system for FSA and the 
     Corporation.
       The Managers intend for funds provided to the Farm Service 
     Agency under this Section to be used for salaries and 
     expenses of county office personnel in implementing this Act.

     From the Committee on Agriculture, for consideration of the 
     House bill and the Senate amendment, and modifications 
     committed to conference:
     Larry Combest,
     Bob Goodlatte,
     Richard Pombo,
     Terry Everett,
     Frank D. Lucas,
     Saxby Chambliss,
     Jerry Moran,
     Charles W. Stenholm,
     Gary Condit,
     Collin C. Peterson,
     Eva M. Clayton,
     Tim Holden,
     As additional conferees from the Committee on the Budget, for 
     consideration of sec. 197 of the Senate amendment, and 
     modifications committed to conference:
     Jim Nussle,
     From the Committee on Education and the Workforce, for 
     consideration of secs. 453-5, 457-9, 460-1, and 464 of the 
     Senate amendment, and modifications committed to conference:
     Michael N. Castle,
     Tom Osborne,
     Dale E. Kildee,
     From the Committee on Energy and Commerce, for consideration 
     of secs. 213, 605, 627, 648, 652, 902, 1041, and 1079E of the 
     Senate amendment, and modifications committed to conference:
     Billy Tauzin,
     Joe Barton,
     John D. Dingell,
     From the Committee on Financial Services, for consideration 
     of secs. 335 and 601 of the Senate amendment, and 
     modifications committed to conference:
     Michael G. Oxley,
     Spencer Bachus,
     John J. LaFalce,
       (except for sec. 335),
     From the Committee on International Relations, for 
     consideration of title III of the House bill and title III of 
     the Senate amendment, and modifications committed to 
     conference:
     Henry Hyde,
     Christopher Smith,
     Tom Lantos,
     From the Committee on the Judiciary, for consideration of 
     secs. 940-1 of the House bill and secs. 602, 1028-9, 1033-5, 
     1046, 1049, 1052-3, 1058, 1068-9, 1070-1, 1098, and 1098A of 
     the Senate amendment, and modifications committed to 
     conference:
     Mark Green,
     From the Committee on Resources, for consideration of secs. 
     201, 203, 211, 213, 215-7, 262, 721, 786, 806, 810, 817-8, 
     1069, 1070, and 1076 of the Senate amendment, and 
     modifications committed to conference:
     James V. Hansen,
     Don Young,
     From the Committee on Science, for consideration of secs. 
     808, 811, 902-3, and 1079 of the Senate amendment, and 
     modifications committed to conference:
     Sherwood Boehlert,
     Roscoe G. Bartlett,
     Ralph M. Hall,
     From the Committee on Ways and Means, for consideration of 
     secs. 127 and 146 of the House bill and sections 144, 1024, 
     1038, and 1070 of the Senate amendment, and modifications 
     committed to conference:
     Charles B. Rangel,
                                Managers on the Part of the House.

     Tom Harkin,
     Patrick Leahy,
     Kent Conrad,
     Tom Daschle,
     Thad Cochran,
     Managers on the Part of the Senate.

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