    [House Report 104-462]
    [From the U.S. Government Publishing Office]

    104th Congress                                            Rept. 104-462
                            HOUSE OF REPRESENTATIVES

     2d Session                                                      Part 1
    _______________________________________________________________________

                       AGRICULTURAL MARKET TRANSITION ACT
    _______________________________________________________________________

    February 9, 1996.--Committed to the Committee of the Whole House on the
                  State of the Union and ordered to be printed

                                    _______

    Mr. Roberts, from the Committee on Agriculture, submitted the following

                                  R E P O R T

                                 together with

            MINORITY, DISSENTING, ADDITIONAL, AND SUPPLEMENTAL VIEWS

                            [To accompany H.R. 2854]

          [Including cost estimate of the Congressional Budget Office]

      The Committee on Agriculture, to whom was referred the bill
    (H.R. 2854) to modify the operation of certain agricultural
    programs, having considered the same, report favorably thereon
    with an amendment and recommend that the bill as amended do
    pass.
      The amendment is as follows:
      Strike out all after the enacting clause and insert in lieu
    thereof the following:

    SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

      (a) Short Title.--This Act may be cited as the ``Agricultural Market
    Transition Act''.
      (b) Table of Contents.--The table of contents of this Act is as
    follows:

    Sec. 1. Short title; table of contents.

                TITLE I--AGRICULTURAL MARKET TRANSITION PROGRAM

    Sec. 101. Purpose.
    Sec. 102. Definitions.
    Sec. 103. Production flexibility contracts.
    Sec. 104. Nonrecourse marketing assistance loans and loan deficiency
    payments.
    Sec. 105. Payment limitations.
    Sec. 106. Peanut program.
    Sec. 107. Sugar program.
    Sec. 108. Administration.
    Sec. 109. Elimination of permanent price support authority.
    Sec. 110. Effect of amendments.

                                TITLE II--DAIRY

              Subtitle A--Milk Price Support and Other Activities

    Sec. 201. Milk price support program.
    Sec. 202. Recourse loans for commercial processors of dairy products.
    Sec. 203. Dairy export incentive program.
    Sec. 204. Dairy promotion program.
    Sec. 205. Fluid milk standards under milk marketing orders.
    Sec. 206. Manufacturing allowance.
    Sec. 207. Establishment of temporary Class I price and temporary Class
    I equalization pools.
    Sec. 208. Establishment of temporary Class IV price and temporary Class
    IV equalization pool.
    Sec. 209. Authority for establishment of standby pools.

              Subtitle B--Reform of Federal Milk Marketing Orders

    Sec. 221. Issuance or amendment of Federal milk marketing orders to
    implement certain reforms.
    Sec. 222. Reform process.
    Sec. 223. Effect of failure to comply with reform process requirements.

                            TITLE III--CONSERVATION

    Sec. 301. Conservation.

              TITLE IV--AGRICULTURAL PROMOTION AND EXPORT PROGRAMS

    Sec. 401. Market promotion program.
    Sec. 402. Export enhancement program.

                             TITLE V--MISCELLANEOUS

    Sec. 501. Crop insurance.
    Sec. 502. Collection and use of agricultural quarantine and inspection
    fees.
    Sec. 503. Commodity Credit Corporation interest rate.
    Sec. 504. Establishment of Office of Risk Management.
    Sec. 505. Business Interruption Insurance Program.
    Sec. 506. Continuation of options pilot program.

          TITLE VI--COMMISSION ON 21ST CENTURY PRODUCTION AGRICULTURE

    Sec. 601. Establishment.
    Sec. 602. Composition.
    Sec. 603. Comprehensive review of past and future of production
    agriculture.
    Sec. 604. Reports.
    Sec. 605. Powers.
    Sec. 606. Commission procedures.
    Sec. 607. Personnel matters.
    Sec. 608. Termination of Commission.

                  TITLE VII--EXTENSION OF CERTAIN AUTHORITIES

    Sec. 701. Extension of authority under Public Law 480.
    Sec. 702. Extension of food for progress program.

                TITLE I--AGRICULTURAL MARKET TRANSITION PROGRAM

    SEC. 101. PURPOSE.

      It is the purpose of this title--
              (1) to authorize the use of binding production flexibility
            contracts between the United States and agricultural producers
            to support farming certainty and flexibility while ensuring
            continued compliance with farm conservation compliance plans
            and wetland protection requirements;
              (2) to make nonrecourse marketing assistance loans and loan
            deficiency available for certain crops;
              (3) to improve the operation of farm programs for peanuts and
            sugar; and
              (4) to terminate price support authority under the
            Agricultural Act of 1949.

    SEC. 102. DEFINITIONS.

      In this title:
              (1) Considered planted.--The term ``considered planted''
            means acreage that is considered planted under title V of the
            Agricultural Act of 1949 (7 U.S.C. 1461 et seq.) (as in effect
            prior to the amendment made by section 109(b)(2)).
              (2) Contract.--The term ``contract'' means a production
            flexibility contract entered into under section 103.
              (3) Contract acreage.--The term ``contract acreage'' means 1
            or more crop acreage bases established for contract commodities
            under title V of the Agricultural Act of 1949 (as in effect
            prior to the amendment made by section 109(b)(2)) that would
            have been in effect for the 1996 crop (but for the amendment
            made by section 109(b)(2)).
              (4) Contract commodity.--The term ``contract commodity''
            means wheat, corn, grain sorghum, barley, oats, upland cotton,
            and rice.
              (5) Contract payment.--The term ``contract payment'' means a
            payment made under section 103 pursuant to a contract.
              (6) Corn.--The term ``corn'' means field corn.
              (7) Department.--The term ``Department'' means the United
            States Department of Agriculture.
              (8) Farm program payment yield.--The term ``farm program
            payment yield'' means the farm program payment yield
            established for the 1995 crop of a contract commodity under
            title V of the Agricultural Act of 1949 (as in effect prior to
            the amendment made by section 109(b)(2)).
              (9) Loan commodity.--The term ``loan commodity'' means each
            contract commodity, extra long staple cotton, and oilseeds.
              (10) Oilseed.--The term ``oilseed'' means a crop of soybeans,
            sunflower seed, rapeseed, canola, safflower, flaxseed, mustard
            seed, or, if designated by the Secretary, other oilseeds.
              (11) Person.--The term ``person'' means an individual,
            partnership, firm, joint-stock company, corporation,
            association, trust, estate, or State agency.
              (12) Producer.--
                      (A) In general.--The term ``producer'' means a person
                    who, as owner, landlord, tenant, or sharecropper,
                    shares in the risk of producing a crop, and is entitled
                    to share in the crop available for marketing from the
                    farm, or would have shared had the crop been produced.
                      (B) Hybrid seed.--The term ``producer'' includes a
                    person growing hybrid seed under contract. In
                    determining the interest of a grower of hybrid seed in
                    a crop, the Secretary shall not take into consideration
                    the existence of a hybrid seed contract.
              (13) Program.--The term ``program'' means the agricultural
            market transition program established under this title.
              (14) Secretary.--The term ``Secretary'' means the Secretary
            of Agriculture.
              (15) State.--The term ``State'' means each of the several
            States of the United States, the District of Columbia, the
            Commonwealth of Puerto Rico, and any other territory or
            possession of the United States.
              (16) United states.--The term ``United States'', when used in
            a geographical sense, means all of the States.

    SEC. 103. PRODUCTION FLEXIBILITY CONTRACTS.

      (a) Contracts Authorized.--
              (1) Offer and terms.--Beginning as soon as practicable after
            the date of the enactment of this title, the Secretary shall
            offer to enter into a contract with an eligible owner or
            operator described in paragraph (2) on a farm containing
            eligible farmland. Under the terms of a contract, the owner or
            operator shall agree, in exchange for annual contract payments,
            to comply with--
                      (A) the conservation plan for the farm prepared in
                    accordance with section 1212 of the Food Security Act
                    of 1985 (16 U.S.C. 3812);
                      (B) wetland protection requirements applicable to the
                    farm under subtitle C of title XII of the Act (16
                    U.S.C. 3821 et seq.); and
                      (C) the planting flexibility requirements of
                    subsection (j).
              (2) Eligible owners and operators described.--The following
            persons shall be considered to be an owner or operator eligible
            to enter into a contract:
                      (A) An owner of eligible farmland who assumes all of
                    the risk of producing a crop.
                      (B) An owner of eligible farmland who shares in the
                    risk of producing a crop.
                      (C) An operator of eligible farmland with a share-
                    rent lease of the eligible farmland, regardless of the
                    length of the lease, if the owner enters into the same
                    contract.
                      (D) An operator of eligible farmland who cash rents
                    the eligible farmland under a lease expiring on or
                    after September 30, 2002, in which case the consent of
                    the owner is not required.
                      (E) An operator of eligible farmland who cash rents
                    the eligible farmland under a lease expiring before
                    September 30, 2002, if the owner consents to the
                    contract.
                      (F) An owner of eligible farmland who cash rents the
                    eligible farmland and the lease term expires before
                    September 30, 2002, but only if the actual operator of
                    the farm declines to enter into a contract. In the case
                    of an owner covered by this subparagraph, contract
                    payments shall not begin under a contract until the
                    fiscal year following the fiscal year in which the
                    lease held by the nonparticipating operator expires.
                      (G) An owner or operator described in any preceding
                    subparagraph of this paragraph regardless of whether
                    the owner or operator purchased catastrophic risk
                    protection for a fall-planted 1996 crop under section
                    508(b) of the Federal Crop Insurance Act (7 U.S.C.
                    1508(b)).
              (3) Tenants and sharecroppers.--In carrying out this section,
            the Secretary shall provide adequate safeguards to protect the
            interests of operators who are tenants and sharecroppers.
      (b) Elements.--
              (1) Time for contracting.--
                      (A) Deadline.--Except as provided in subparagraph
                    (B), the Secretary may not enter into a contract after
                    April 15, 1996.
                      (B) Conservation reserve lands.--
                              (i) In general.--At the beginning of each
                            fiscal year, the Secretary shall allow an
                            eligible owner or operator on a farm covered by
                            a conservation reserve contract entered into
                            under section 1231 of the Food Security Act of
                            1985 (16 U.S.C. 3831) that terminates after the
                            date specified in subparagraph (A) to enter
                            into or expand a production flexibility
                            contract to cover the contract acreage of the
                            farm that was subject to the former
                            conservation reserve contract.
                              (ii) Amount.--Contract payments made for
                            contract acreage under this subparagraph shall
                            be made at the rate and amount applicable to
                            the annual contract payment level for the
                            applicable crop.
              (2) Duration of contract.--
                      (A) Beginning date.--A contract shall begin with--
                              (i) the 1996 crop of a contract commodity; or
                              (ii) in the case of acreage that was subject
                            to a conservation reserve contract described in
                            paragraph (1)(B), the date the production
                            flexibility contract was entered into or
                            expanded to cover the acreage.
                      (B) Ending date.--A contract shall extend through the
                    2002 crop.
              (3) Estimation of contract payments.--At the time the
            Secretary enters into a contract, the Secretary shall provide
            an estimate of the minimum contract payments anticipated to be
            made during at least the first fiscal year for which contract
            payments will be made.
      (c) Eligible Farmland Described.--Land shall be considered to be
    farmland eligible for coverage under a contract only if the land has
    contract acreage attributable to the land and--
              (1) for at least 1 of the 1991 through 1995 crops, at least a
            portion of the land was enrolled in the acreage reduction
            program authorized for a crop of a contract commodity under
            section 101B, 103B, 105B, or 107B of the Agricultural Act of
            1949 (as in effect prior to the amendment made by section
            109(b)(2)) or was considered planted;
              (2) was subject to a conservation reserve contract under
            section 1231 of the Food Security Act of 1985 (16 U.S.C. 3831)
            whose term expired, or was voluntarily terminated, on or after
            January 1, 1995; or
              (3) is released from coverage under a conservation reserve
            contract by the Secretary during the period beginning on
            January 1, 1995, and ending on the date specified in subsection
            (b)(1)(A).
      (d) Time for Payment.--
              (1) In general.--An annual contract payment shall be made not
            later than September 30 of each of fiscal years 1996 through
            2002.
              (2) Advance payments.--
                      (A) Fiscal year 1996.--At the option of the owner or
                    operator, 50 percent of the contract payment for fiscal
                    year 1996 shall be made not later than June 15, 1996.
                      (B) Subsequent fiscal years.--At the option of the
                    owner or operator for fiscal year 1997 and each
                    subsequent fiscal year, 50 percent of the annual
                    contract payment shall be made on December 15.
      (e) Amounts Available for Contract Payments for Each Fiscal Year.--
              (1) In general.--The Secretary shall, to the maximum extent
            practicable, expend on a fiscal year basis the following
            amounts to satisfy the obligations of the Secretary under all
            contracts:
                      (A) For fiscal year 1996, $5,570,000,000.
                      (B) For fiscal year 1997, $5,385,000,000.
                      (C) For fiscal year 1998, $5,800,000,000.
                      (D) For fiscal year 1999, $5,603,000,000.
                      (E) For fiscal year 2000, $5,130,000,000.
                      (F) For fiscal year 2001, $4,130,000,000.
                      (G) For fiscal year 2002, $4,008,000,000.
              (2) Allocation.--The amount made available for a fiscal year
            under paragraph (1) shall be allocated as follows:
                      (A) For wheat, 26.26 percent.
                      (B) For corn, 46.22 percent.
                      (C) For grain sorghum, 5.11 percent.
                      (D) For barley, 2.16 percent.
                      (E) For oats, 0.15 percent.
                      (F) For upland cotton, 11.63 percent.
                      (G) For rice, 8.47 percent.
              (3) Adjustment.--The Secretary shall adjust the amounts
            allocated for each contract commodity under paragraph (2) for a
            particular fiscal year by--
                      (A) adding an amount equal to the sum of all
                    repayments of deficiency payments received under
                    section 114(a)(2) of the Agricultural Act of 1949 (as
                    in effect prior to the amendment made by section
                    109(b)(2)) for the commodity;
                      (B) to the maximum extent practicable, adding an
                    amount equal to the sum of all contract payments
                    withheld by the Secretary, at the request of an owner
                    or operator subject to a contract, as an offset against
                    repayments of deficiency payments otherwise required
                    under section 114(a)(2) of the Act (as so in effect)
                    for the commodity;
                      (C) adding an amount equal to the sum of all refunds
                    of contract payments received during the preceding
                    fiscal year under subsection (h) of this section for
                    the commodity; and
                      (D) subtracting an amount equal to the amount, if
                    any, necessary during that fiscal year to satisfy
                    payment requirements for the commodity under sections
                    103B, 105B, or 107B of the Agricultural Act of 1949 (as
                    in effect prior to the amendment made by section
                    109(b)(2)) for the 1994 and 1995 crop years.
              (4) Special adjustment to cover existing rice payment
            requirements.--As soon as possible after the date of the
            enactment of this Act, the Secretary shall determine the
            amount, if any, necessary to satisfy remaining payment
            requirements under section 101B of the Agricultural Act of 1949
            (as in effect prior to the amendment made by section 109(b)(2))
            for the 1994 and 1995 crops of rice. The total amount
            determined under this paragraph shall be deducted, in equal
            amounts each fiscal year, from the amount allocated for rice
            under paragraph (2)(G) for fiscal years after the fiscal year
            in which the final remaining payments are made for rice.
      (f) Determination of Contract Payments.--
              (1) Individual payment quantity of contract commodities.--For
            each contract, the payment quantity of a contract commodity for
            each fiscal year shall be equal to the product of--
                      (A) 85 percent of the contract acreage; and
                      (B) the farm program payment yield.
              (2) Annual payment quantity of contract commodities.--The
            payment quantity of each contract commodity covered by all
            contracts for each fiscal year shall equal the sum of the
            amounts calculated under paragraph (1) for each individual
            contract.
              (3) Annual payment rate.--The payment rate for a contract
            commodity for each fiscal year shall be equal to--
                      (A) the amount made available under subsection (e)
                    for the contract commodity for the fiscal year; divided
                    by
                      (B) the amount determined under paragraph (2) for the
                    fiscal year.
              (4) Annual payment amount.--The amount to be paid under a
            contract in effect for each fiscal year with respect to a
            contract commodity shall be equal to the product of--
                      (A) the payment quantity determined under paragraph
                    (1) with respect to the contract; and
                      (B) the payment rate in effect under paragraph (3).
              (5) Assignment of contract payments.--The provisions of
            section 8(g) of the Soil Conservation and Domestic Allotment
            Act (16 U.S.C. 590h(g)) (relating to assignment of payments)
            shall apply to contract payments under this subsection. The
            owner or operator making the assignment, or the assignee, shall
            provide the Secretary with notice, in such manner as the
            Secretary may require in the contract, of any assignment made
            under this paragraph.
              (6) Sharing of contract payments.--The Secretary shall
            provide for the sharing of contract payments among the owners
            and operators subject to the contract on a fair and equitable
            basis.
      (g) Payment Limitation.--The total amount of contract payments made
    to a person under a contract during any fiscal year may not exceed the
    payment limitations established under sections 1001 through 1001C of
    the Food Security Act of 1985 (7 U.S.C. 1308 through 1308-3).
      (h) Effect of Violation.--
              (1) Termination of contract.--Except as provided in paragraph
            (2), if an owner or operator subject to a contract violates the
            conservation plan for the farm containing eligible farmland
            under the contract, wetland protection requirements applicable
            to the farm, or the planting flexibility requirements of
            subsection (j), the Secretary shall terminate the contract with
            respect to the owner or operator on each farm in which the
            owner or operator has an interest. On the termination, the
            owner or operator shall forfeit all rights to receive future
            contract payments on each farm in which the owner or operator
            has an interest and shall refund to the Secretary all contract
            payments received by the owner or operator during the period of
            the violation, together with interest on the contract payments
            as determined by the Secretary.
              (2) Refund or adjustment.--If the Secretary determines that a
            violation does not warrant termination of the contract under
            paragraph (1), the Secretary may require the owner or operator
            subject to the contract--
                      (A) to refund to the Secretary that part of the
                    contract payments received by the owner or operator
                    during the period of the violation, together with
                    interest on the contract payments as determined by the
                    Secretary; or
                      (B) to accept a reduction in the amount of future
                    contract payments that is proportionate to the severity
                    of the violation, as determined by the Secretary.
              (3) Foreclosure.--An owner or operator subject to a contract
            may not be required to make repayments to the Secretary of
            amounts received under the contract if the contract acreage has
            been foreclosed on and the Secretary determines that forgiving
            the repayments is appropriate in order to provide fair and
            equitable treatment. This paragraph shall not void the
            responsibilities of such an owner or operator under the
            contract if the owner or operator continues or resumes
            operation, or control, of the contract acreage. On the
            resumption of operation or control over the contract acreage by
            the owner or operator, the provisions of the contract in effect
            on the date of the foreclosure shall apply.
              (4) Review.--A determination of the Secretary under this
            subsection shall be considered to be an adverse decision for
            purposes of the availability of administrative review of the
            determination.
      (i) Transfer of Interest in Lands Subject to Contract.--
              (1) Effect of transfer.--Except as provided in paragraph (2),
            the transfer by an owner or operator subject to a contract of
            the right and interest of the owner or operator in the contract
            acreage shall result in the termination of the contract with
            respect to the acreage, effective on the date of the transfer,
            unless the transferee of the acreage agrees with the Secretary
            to assume all obligations of the contract. At the request of
            the transferee, the Secretary may modify the contract if the
            modifications are consistent with the objectives of this
            section as determined by the Secretary.
              (2) Exception.--If an owner or operator who is entitled to a
            contract payment dies, becomes incompetent, or is otherwise
            unable to receive the contract payment, the Secretary shall
            make the payment, in accordance with regulations prescribed by
            the Secretary.
      (j) Planting Flexibility.--
              (1) Permitted crops.--Subject to paragraph (2), any commodity
            or crop may be planted on contract acreage on a farm.
              (2) Limitations.--
                      (A) Haying and grazing.--
                              (i) Time limitations.--Haying and grazing on
                            land exceeding 15 percent of the contract
                            acreage on a farm as provided in clause (iii)
                            shall be permitted, except during any
                            consecutive 5-month period between April 1 and
                            October 31 that is determined by the State
                            committee established under section 8(b) of the
                            Soil Conservation and Domestic Allotment Act (6
                            U.S.C. 590h(b)) for a State. In the case of a
                            natural disaster, the Secretary may permit
                            unlimited haying and grazing on the contract
                            acreage of a farm.
                              (ii) Contract commodities.--Contract acreage
                            planted to a contract commodity for harvest may
                            be hayed or grazed at any time without
                            limitation.
                              (iii) Haying and grazing limitation on
                            portion or contract acreage.--Unlimited haying
                            and grazing shall be permitted on not more than
                            15 percent of the contract acreage on a farm.
                      (B) Alfalfa.--Alfalfa may be grown on contract
                    acreage in excess of the acreage limitation in
                    subparagraph (A)(iii) and without regard to the time
                    limitation in subparagraph (A)(i), except that each
                    contract acre on a farm that is planted for harvest to
                    alfalfa in excess of 15 percent of the total contract
                    acreage on the farm shall be ineligible for contract
                    payments.
                      (C) Fruits and vegetables.--
                              (i) In general.--The planting for harvest of
                            fruits and vegetables shall be prohibited on
                            contract acreage, except in any region in which
                            there is a history of double-cropping, as
                            determined by the Secretary.
                              (ii) Unrestricted vegetables.--
                            Notwithstanding clause (i), lentils, mung
                            beans, and dry peas may be planted for harvest
                            without limitation on contract acreage.

    SEC. 104. NONRECOURSE MARKETING ASSISTANCE LOANS AND LOAN DEFICIENCY
                        PAYMENTS.

      (a) Availability of Marketing Assistance Loans.--
              (1) Nonrecourse loans available.--For each of the 1996
            through 2002 crops of each loan commodity, the Secretary shall
            make available to producers on a farm nonrecourse marketing
            assistance loans for loan commodities produced on the farm. The
            loans shall be made under terms and conditions that are
            prescribed by the Secretary and at the loan rate established
            under subsection (b) for the loan commodity.
              (2) Eligible production.--The following production shall be
            eligible for a marketing assistance loan under paragraph (1):
                      (A) In the case of a marketing assistance loan for a
                    contract commodity, any production by a producer who
                    has entered into a production flexibility contract.
                      (B) In the case of a marketing assistance loan for
                    extra long staple cotton and oilseeds, any production.
              (3) Recourse loans for high moisture feed grains.--
                      (A) Recourse loans available.--For each of the 1996
                    through 2002 crops of corn and grain sorghum, the
                    Secretary shall make available recourse loans, as
                    determined by the Secretary, to producers on a farm
                    who--
                              (i) normally harvest all or a portion of
                            their crop of corn or grain sorghum in a high
                            moisture state;
                              (ii) present--
                                      (I) certified scale tickets from an
                                    inspected, certified commercial scale,
                                    including licensed warehouses,
                                    feedlots, feed mills, distilleries, or
                                    other similar entities approved by the
                                    Secretary, pursuant to regulations
                                    issued by the Secretary; or
                                      (II) present field or other physical
                                    measurements of the standing or stored
                                    crop in regions of the country, as
                                    determined by the Secretary, that do
                                    not have certified commercial scales
                                    from which certified scale tickets may
                                    be obtained within reasonable proximity
                                    of harvest operation;
                              (iii) certify that they were the owners of
                            the feed grain at the time of delivery to, and
                            that the quantity to be placed under loan under
                            this paragraph was in fact harvested on the
                            farm and delivered to, a feedlot, feed mill, or
                            commercial or on-farm high-moisture storage
                            facility, or to such facilities maintained by
                            the users of corn and grain sorghum in a high
                            moisture state; and
                              (iv) comply with deadlines established by the
                            Secretary for harvesting the corn or grain
                            sorghum and submit applications for loans under
                            this paragraph within deadlines established by
                            the Secretary.
                      (B) Eligibility of acquired feed grains.--Loans under
                    this paragraph shall be made on a quantity of corn or
                    grain sorghum of the same crop acquired by the producer
                    equivalent to a quantity determined by multiplying--
                              (i) the acreage of the corn or grain sorghum
                            in a high moisture state harvested on the
                            producer's farm; by
                              (ii) the lower of the farm program payment
                            yield or the actual yield on a field, as
                            determined by the Secretary, that is similar to
                            the field from which the corn or grain sorghum
                            was obtained.
                      (C) High moisture state defined.--In this paragraph,
                    the term ``high moisture state'' means corn or grain
                    sorghum having a moisture content in excess of
                    Commodity Credit Corporation standards for marketing
                    assistance loans made by the Secretary under paragraph
                    (1).
      (b) Loan Rates.--
              (1) Wheat.--
                      (A) Loan rate.--Subject to subparagraph (B), the loan
                    rate for a marketing assistance loan under subsection
                    (a)(1) for wheat shall be--
                              (i) not less than 85 percent of the simple
                            average price received by producers of wheat,
                            as determined by the Secretary, during the
                            marketing years for the immediately preceding 5
                            crops of wheat, excluding the year in which the
                            average price was the highest and the year in
                            which the average price was the lowest in the
                            period; but
                              (ii) not more than $2.58 per bushel.
                      (B) Stocks to use ratio adjustment.--If the Secretary
                    estimates for any marketing year that the ratio of
                    ending stocks of wheat to total use for the marketing
                    year will be--
                              (i) equal to or greater than 30 percent, the
                            Secretary may reduce the loan rate for wheat
                            for the corresponding crop by an amount not to
                            exceed 10 percent in any year;
                              (ii) less than 30 percent but not less than
                            15 percent, the Secretary may reduce the loan
                            rate for wheat for the corresponding crop by an
                            amount not to exceed 5 percent in any year; or
                              (iii) less than 15 percent, the Secretary may
                            not reduce the loan rate for wheat for the
                            corresponding crop.
                      (C) No effect on future years.--Any reduction in the
                    loan rate for wheat under subparagraph (B) shall not be
                    considered in determining the loan rate for wheat for
                    subsequent years.
              (2) Feed grains.--
                      (A) Loan rate for corn.--Subject to subparagraph (B),
                    the loan rate for a marketing assistance loan under
                    subsection (a)(1) for corn shall be--
                              (i) not less than 85 percent of the simple
                            average price received by producers of corn, as
                            determined by the Secretary, during the
                            marketing years for the immediately preceding 5
                            crops of corn, excluding the year in which the
                            average price was the highest and the year in
                            which the average price was the lowest in the
                            period; but
                              (ii) not more than $1.89 per bushel.
                      (B) Stocks to use ratio adjustment.--If the Secretary
                    estimates for any marketing year that the ratio of
                    ending stocks of corn to total use for the marketing
                    year will be--
                              (i) equal to or greater than 25 percent, the
                            Secretary may reduce the loan rate for corn for
                            the corresponding crop by an amount not to
                            exceed 10 percent in any year;
                              (ii) less than 25 percent but not less than
                            12.5 percent, the Secretary may reduce the loan
                            rate for corn for the corresponding crop by an
                            amount not to exceed 5 percent in any year; or
                              (iii) less than 12.5 percent the Secretary
                            may not reduce the loan rate for corn for the
                            corresponding crop.
                      (C) No effect on future years.--Any reduction in the
                    loan rate for corn under subparagraph (B) shall not be
                    considered in determining the loan rate for corn for
                    subsequent years.
                      (D) Other feed grains.--The loan rate for a marketing
                    assistance loan under subsection (a)(1) for grain
                    sorghum, barley, and oats, respectively, shall be
                    established at such level as the Secretary determines
                    is fair and reasonable in relation to the rate that
                    loans are made available for corn, taking into
                    consideration the feeding value of the commodity in
                    relation to corn.
              (3) Upland cotton.--
                      (A) Loan rate.--Subject to subparagraph (B), the loan
                    rate for a marketing assistance loan under subsection
                    (a)(1) for upland cotton shall be established by the
                    Secretary at such loan rate, per pound, as will reflect
                    for the base quality of upland cotton, as determined by
                    the Secretary, at average locations in the United
                    States a rate that is not less than the smaller of--
                              (i) 85 percent of the average price (weighted
                            by market and month) of the base quality of
                            cotton as quoted in the designated United
                            States spot markets during 3 years of the 5-
                            year period ending July 31 in the year in which
                            the loan rate is announced, excluding the year
                            in which the average price was the highest and
                            the year in which the average price was the
                            lowest in the period; or
                              (ii) 90 percent of the average, for the 15-
                            week period beginning July 1 of the year in
                            which the loan rate is announced, of the 5
                            lowest-priced growths of the growths quoted for
                            Middling 1\3/32\-inch cotton C.I.F. Northern
                            Europe (adjusted downward by the average
                            difference during the period April 15 through
                            October 15 of the year in which the loan is
                            announced between the average Northern European
                            price quotation of such quality of cotton and
                            the market quotations in the designated United
                            States spot markets for the base quality of
                            upland cotton), as determined by the Secretary.
                      (B) Limitations.--The loan rate for a marketing
                    assistance loan for upland cotton shall not be less
                    than $0.50 per pound or more than $0.5192 per pound.
              (4) Extra long staple cotton.--The loan rate for a marketing
            assistance loan under subsection (a)(1) for extra long staple
            cotton shall be--
                      (A) not less than 85 percent of the simple average
                    price received by producers of extra long staple
                    cotton, as determined by the Secretary, during 3 years
                    of the 5 previous marketing years, excluding the year
                    in which the average price was the highest and the year
                    in which the average price was the lowest in the
                    period; but
                      (B) not more than $0.7965 per pound.
              (5) Rice.--The loan rate for a marketing assistance loan
            under subsection (a)(1) for rice shall be $6.50 per
            hundredweight.
              (6) Oilseeds.--
                      (A) Soybeans.--The loan rate for a marketing
                    assistance loan under subsection (a)(1) for soybeans
                    shall be $4.92 per bushel.
                      (B) Sunflower seed, canola, rapeseed, safflower,
                    mustard seed, and flaxseed.--The loan rates for a
                    marketing assistance loan under subsection (a)(1) for
                    sunflower seed, canola, rapeseed, safflower, mustard
                    seed, and flaxseed, individually, shall be $0.087 per
                    pound.
                      (C) Other oilseeds.--The loan rates for a marketing
                    assistance loan under subsection (a)(1) for other
                    oilseeds shall be established at such level as the
                    Secretary determines is fair and reasonable in relation
                    to the loan rate available for soybeans, except in no
                    event shall the rate for the oilseeds (other than
                    cottonseed) be less than the rate established for
                    soybeans on a per-pound basis for the same crop.
      (c) Term of Loan.--In the case of each loan commodity (other than
    upland cotton or extra long staple cotton), a marketing assistance loan
    under subsection (a)(1) shall have a term of 9 months beginning on the
    first day of the first month after the month in which the loan is made.
    A marketing assistance loan for upland cotton or extra long staple
    cotton shall have a term of 10 months beginning on the first day of the
    first month after the month in which the loan is made. The Secretary
    may not extend the term of a marketing assistance loan for any loan
    commodity.
      (d) Repayment.--
              (1) Repayment rates generally.--The Secretary shall permit
            producers to repay a marketing assistance loan under subsection
            (a)(1) for a loan commodity (other than extra long staple
            cotton) at a level that is the lesser of--
                      (A) the loan rate established for the commodity under
                    subsection (b); or
                      (B) the prevailing world market price for the
                    commodity (adjusted to United States quality and
                    location), as determined by the Secretary.
              (2) Additional repayment rates for wheat, feed grains, and
            oilseeds.--In the case of a marketing assistance loan under
            subsection (a)(1) for wheat, corn, grain sorghum, barley, oats,
            or oilseeds, the Secretary shall also permit a producer to
            repay the loan at such level as the Secretary determines will--
                      (A) minimize potential loan forfeitures;
                      (B) minimize the accumulation of stocks of the
                    commodity by the Federal Government;
                      (C) minimize the cost incurred by the Federal
                    Government in storing the commodity; and
                      (D) allow the commodity produced in the United States
                    to be marketed freely and competitively, both
                    domestically and internationally.
              (3) Repayment rates for extra long staple cotton.--Repayment
            of a marketing assistance loan for extra long staple cotton
            shall be at the loan rate established for the commodity under
            subsection (b), plus interest (as determined by the Secretary).
              (4) Prevailing world market price.--For purposes of paragraph
            (1) and subsection (f), the Secretary shall prescribe by
            regulation--
                      (A) a formula to determine the prevailing world
                    market price for each loan commodity, adjusted to
                    United States quality and location; and
                      (B) a mechanism by which the Secretary shall announce
                    periodically the prevailing world market price for each
                    loan commodity.
              (5) Adjustment of prevailing world market price for upland
            cotton.--
                      (A) In general.--During the period ending July 31,
                    2003, the prevailing world market price for upland
                    cotton (adjusted to United States quality and location)
                    established under paragraph (4) shall be further
                    adjusted if--
                              (i) the adjusted prevailing world market
                            price is less than 115 percent of the loan rate
                            for upland cotton established under subsection
                            (b), as determined by the Secretary; and
                              (ii) the Friday through Thursday average
                            price quotation for the lowest-priced United
                            States growth as quoted for Middling (M) 1\3/
                            32\-inch cotton delivered C.I.F. Northern
                            Europe is greater than the Friday through
                            Thursday average price of the 5 lowest-priced
                            growths of upland cotton, as quoted for
                            Middling (M) 1\3/32\-inch cotton, delivered
                            C.I.F. Northern Europe (referred to in this
                            subsection as the ``Northern Europe price'').
                      (B) Further adjustment.--Except as provided in
                    subparagraph (C), the adjusted prevailing world market
                    price for upland cotton shall be further adjusted on
                    the basis of some or all of the following data, as
                    available:
                              (i) The United States share of world exports.
                              (ii) The current level of cotton export sales
                            and cotton export shipments.
                              (iii) Other data determined by the Secretary
                            to be relevant in establishing an accurate
                            prevailing world market price for upland cotton
                            (adjusted to United States quality and
                            location).
                      (C) Limitation on further adjustment.--The adjustment
                    under subparagraph (B) may not exceed the difference
                    between--
                              (i) the Friday through Thursday average price
                            for the lowest-priced United States growth as
                            quoted for Middling 1\3/32\-inch cotton
                            delivered C.I.F. Northern Europe; and
                              (ii) the Northern Europe price.
      (e) Loan Deficiency Payments.--
              (1) Availability.--Except as provided in paragraph (4), the
            Secretary may make loan deficiency payments available to
            producers who, although eligible to obtain a marketing
            assistance loan under subsection (a)(1) with respect to a loan
            commodity, agree to forgo obtaining the loan for the commodity
            in return for payments under this subsection.
              (2) Computation.--A loan deficiency payment under this
            subsection shall be computed by multiplying--
                      (A) the loan payment rate determined under paragraph
                    (3) for the loan commodity; by
                      (B) the quantity of the loan commodity that the
                    producers on a farm are eligible to place under loan
                    but for which the producers forgo obtaining the loan in
                    return for payments under this subsection.
              (3) Loan payment rate.--For purposes of this subsection, the
            loan payment rate shall be the amount by which--
                      (A) the loan rate established under subsection (b)
                    for the loan commodity; exceeds
                      (B) the rate at which a loan for the commodity may be
                    repaid under subsection (d).
              (4) Exception for extra long staple cotton.--This subsection
            shall not apply with respect to extra long staple cotton.
      (f) Special Marketing Loan Provisions for Upland Cotton.--
              (1) Cotton user marketing certificates.--
                      (A) Issuance.--Subject to subparagraph (D), during
                    the period ending July 31, 2003, the Secretary shall
                    issue marketing certificates or cash payments to
                    domestic users and exporters for documented purchases
                    by domestic users and sales for export by exporters
                    made in the week following a consecutive 4-week period
                    in which--
                              (i) the Friday through Thursday average price
                            quotation for the lowest-priced United States
                            growth, as quoted for Middling (M) 1\3/32\-inch
                            cotton, delivered C.I.F. Northern Europe
                            exceeds the Northern Europe price by more than
                            1.25 cents per pound; and
                              (ii) the prevailing world market price for
                            upland cotton (adjusted to United States
                            quality and location) does not exceed 130
                            percent of the loan rate for upland cotton
                            established under subsection (b).
                      (B) Value of certificates or payments.--The value of
                    the marketing certificates or cash payments shall be
                    based on the amount of the difference (reduced by 1.25
                    cents per pound) in the prices during the 4th week of
                    the consecutive 4-week period multiplied by the
                    quantity of upland cotton included in the documented
                    sales.
                      (C) Redemption, marketing, or exchange.--The
                    Secretary shall establish procedures to assist persons
                    receiving marketing certificates under this paragraph
                    in the redemption of certificates for cash, or in the
                    marketing or exchange of certificates for agricultural
                    commodities owned by the Commodity Credit Corporation,
                    in such manner and at such price levels as the
                    Secretary determines will best effectuate the purposes
                    of the marketing certificates. Any price restrictions
                    that may otherwise apply to the disposition of
                    agricultural commodities by the Commodity Credit
                    Corporation shall not apply to the redemption of
                    certificates under this paragraph.
                      (D) Exception.--The Secretary shall not issue
                    marketing certificates or cash payments under
                    subparagraph (A) if, for the immediately preceding
                    consecutive 10-week period, the Friday through Thursday
                    average price quotation for the lowest priced United
                    States growth, as quoted for Middling (M) 1\3/32\-inch
                    cotton, delivered C.I.F. Northern Europe, adjusted for
                    the value of any certificate issued under this
                    paragraph, exceeds the Northern Europe price by more
                    than 1.25 cents per pound.
                      (E) Limitation on expenditures.--Total expenditures
                    under this paragraph shall not exceed $701,000,000
                    during fiscal years 1996 through 2002.
              (2) Special import quota.--
                      (A) Establishment.--The President shall carry out an
                    import quota program that provides that, during the
                    period ending July 31, 2003, whenever the Secretary
                    determines and announces that for any consecutive 10-
                    week period, the Friday through Thursday average price
                    quotation for the lowest-priced United States growth,
                    as quoted for Middling (M) 1\3/32\-inch cotton,
                    delivered C.I.F. Northern Europe, adjusted for the
                    value of any certificates issued under paragraph (1),
                    exceeds the Northern Europe price by more than 1.25
                    cents per pound, there shall immediately be in effect a
                    special import quota.
                      (B) Quantity.--The quota shall be equal to 1 week's
                    consumption of upland cotton by domestic mills at the
                    seasonally adjusted average rate of the most recent 3
                    months for which data are available.
                      (C) Application.--The quota shall apply to upland
                    cotton purchased not later than 90 days after the date
                    of the Secretary's announcement under subparagraph (A)
                    and entered into the United States not later than 180
                    days after the date.
                      (D) Overlap.--A special quota period may be
                    established that overlaps any existing quota period if
                    required by subparagraph (A), except that a special
                    quota period may not be established under this
                    paragraph if a quota period has been established under
                    subsection (g).
                      (E) Preferential tariff treatment.--The quantity
                    under a special import quota shall be considered to be
                    an in-quota quantity for purposes of--
                              (i) section 213(d) of the Caribbean Basin
                            Economic Recovery Act (19 U.S.C. 2703(d));
                              (ii) section 204 of the Andean Trade
                            Preference Act (19 U.S.C. 3203);
                              (iii) section 503(d) of the Trade Act of 1974
                            (19 U.S.C. 2463(d)); and
                              (iv) General Note 3(a)(iv) to the Harmonized
                            Tariff Schedule.
                      (F) Definition.--In this paragraph, the term
                    ``special import quota'' means a quantity of imports
                    that is not subject to the over-quota tariff rate of a
                    tariff-rate quota.
      (g) Limited Global Import Quota for Upland Cotton.--
              (1) In general.--The President shall carry out an import
            quota program that provides that whenever the Secretary
            determines and announces that the average price of the base
            quality of upland cotton, as determined by the Secretary, in
            the designated spot markets for a month exceeded 130 percent of
            the average price of such quality of cotton in the markets for
            the preceding 36 months, notwithstanding any other provision of
            law, there shall immediately be in effect a limited global
            import quota subject to the following conditions:
                      (A) Quantity.--The quantity of the quota shall be
                    equal to 21 days of domestic mill consumption of upland
                    cotton at the seasonally adjusted average rate of the
                    most recent 3 months for which data are available.
                      (B) Quantity if prior quota.--If a quota has been
                    established under this subsection during the preceding
                    12 months, the quantity of the quota next established
                    under this subsection shall be the smaller of 21 days
                    of domestic mill consumption calculated under
                    subparagraph (A) or the quantity required to increase
                    the supply to 130 percent of the demand.
                      (C) Preferential tariff treatment.--The quantity
                    under a limited global import quota shall be considered
                    to be an in-quota quantity for purposes of--
                              (i) section 213(d) of the Caribbean Basin
                            Economic Recovery Act (19 U.S.C. 2703(d));
                              (ii) section 204 of the Andean Trade
                            Preference Act (19 U.S.C. 3203);
                              (iii) section 503(d) of the Trade Act of 1974
                            (19 U.S.C. 2463(d)); and
                              (iv) General Note 3(a)(iv) to the Harmonized
                            Tariff Schedule.
                      (D) Definitions.--In this subsection:
                              (i) Supply.--The term ``supply'' means, using
                            the latest official data of the Bureau of the
                            Census, the Department of Agriculture, and the
                            Department of the Treasury--
                                      (I) the carry-over of upland cotton
                                    at the beginning of the marketing year
                                    (adjusted to 480-pound bales) in which
                                    the quota is established;
                                      (II) production of the current crop;
                                    and
                                      (III) imports to the latest date
                                    available during the marketing year.
                              (ii) Demand.--The term ``demand'' means--
                                      (I) the average seasonally adjusted
                                    annual rate of domestic mill
                                    consumption in the most recent 3 months
                                    for which data are available; and
                                      (II) the larger of--
                                              (aa) average exports of
                                            upland cotton during the
                                            preceding 6 marketing years; or
                                              (bb) cumulative exports of
                                            upland cotton plus outstanding
                                            export sales for the marketing
                                            year in which the quota is
                                            established.
                              (iii) Limited global import quota.--The term
                            ``limited global import quota'' means a
                            quantity of imports that is not subject to the
                            over-quota tariff rate of a tariff-rate quota.
                      (E) Quota entry period.--When a quota is established
                    under this subsection, cotton may be entered under the
                    quota during the 90-day period beginning on the date
                    the quota is established by the Secretary.
              (2) No overlap.--Notwithstanding paragraph (1), a quota
            period may not be established that overlaps an existing quota
            period or a special quota period established under subsection
            (f)(2).
      (h) Source of Loans.--
              (1) In general.--The Secretary shall provide the loans
            authorized by this section and the Agricultural Adjustment Act
            of 1938 (7 U.S.C. 1281 et seq.) through the Commodity Credit
            Corporation and other means available to the Secretary.
              (2) Processors.--Whenever any loan or surplus removal
            operation for any agricultural commodity is carried out through
            purchases from or loans or payments to processors, the
            Secretary shall, to the extent practicable, obtain from the
            processors such assurances as the Secretary considers adequate
            that the producers of the commodity have received or will
            receive maximum benefits from the loan or surplus removal
            operation.
      (i) Adjustments of Loans.--
              (1) In general.--The Secretary may make appropriate
            adjustments in the loan levels for any commodity for
            differences in grade, type, quality, location, and other
            factors.
              (2) Loan level.--The adjustments shall, to the maximum extent
            practicable, be made in such manner that the average loan level
            for the commodity will, on the basis of the anticipated
            incidence of the factors, be equal to the level of support
            determined as provided in this section or the Agricultural
            Adjustment Act of 1938 (7 U.S.C. 1281 et seq.).
      (j) Personal Liability of Producers for Deficiencies.--
              (1) In general.--Except as provided in paragraph (2), no
            producer shall be personally liable for any deficiency arising
            from the sale of the collateral securing any nonrecourse loan
            made under this section or the Agricultural Adjustment Act of
            1938 (7 U.S.C. 1281 et seq.) unless the loan was obtained
            through a fraudulent representation by the producer.
              (2) Limitations.--Paragraph (1) shall not prevent the
            Commodity Credit Corporation or the Secretary from requiring a
            producer to assume liability for--
                      (A) a deficiency in the grade, quality, or quantity
                    of a commodity stored on a farm or delivered by the
                    producer;
                      (B) a failure to properly care for and preserve a
                    commodity; or
                      (C) a failure or refusal to deliver a commodity in
                    accordance with a program established under this
                    section or the Agricultural Adjustment Act of 1938.
              (3) Acquisition of collateral.--The Secretary may include in
            a contract for a nonrecourse loan made under this section or
            the Agricultural Adjustment Act of 1938 a provision that
            permits the Commodity Credit Corporation, on and after the
            maturity of the loan, to acquire title to the unredeemed
            collateral without obligation to pay for any market value that
            the collateral may have in excess of the loan indebtedness.
              (4) Sugarcane and sugar beets.--A security interest obtained
            by the Commodity Credit Corporation as a result of the
            execution of a security agreement by the processor of sugarcane
            or sugar beets shall be superior to all statutory and common
            law liens on raw cane sugar and refined beet sugar in favor of
            the producers of sugarcane and sugar beets and all prior
            recorded and unrecorded liens on the crops of sugarcane and
            sugar beets from which the sugar was derived.
      (k) Commodity Credit Corporation Sales Price Restrictions.--
              (1) In general.--The Commodity Credit Corporation may sell
            any commodity owned or controlled by the Corporation at any
            price that the Secretary determines will maximize returns to
            the Corporation.
              (2) Nonapplication of sales price restrictions.--Paragraph
            (1) shall not apply to--
                      (A) a sale for a new or byproduct use;
                      (B) a sale of peanuts or oilseeds for the extraction
                    of oil;
                      (C) a sale for seed or feed if the sale will not
                    substantially impair any loan program;
                      (D) a sale of a commodity that has substantially
                    deteriorated in quality or as to which there is a
                    danger of loss or waste through deterioration or
                    spoilage;
                      (E) a sale for the purpose of establishing a claim
                    arising out of a contract or against a person who has
                    committed fraud, misrepresentation, or other wrongful
                    act with respect to the commodity;
                      (F) a sale for export, as determined by the
                    Corporation; and
                      (G) a sale for other than a primary use.
              (3) Presidential disaster areas.--
                      (A) In general.--Notwithstanding paragraph (1), on
                    such terms and conditions as the Secretary may consider
                    in the public interest, the Corporation may make
                    available any commodity or product owned or controlled
                    by the Corporation for use in relieving distress--
                              (i) in any area in the United States
                            (including the Virgin Islands) declared by the
                            President to be an acute distress area because
                            of unemployment or other economic cause, if the
                            President finds that the use will not displace
                            or interfere with normal marketing of
                            agricultural commodities; and
                              (ii) in connection with any major disaster
                            determined by the President to warrant
                            assistance by the Federal Government under the
                            Robert T. Stafford Disaster Relief and
                            Emergency Assistance Act (42 U.S.C. 5121 et
                            seq.).
                      (B) Costs.--Except on a reimbursable basis, the
                    Corporation shall not bear any costs in connection with
                    making a commodity available under subparagraph (A)
                    beyond the cost of the commodity to the Corporation
                    incurred in--
                              (i) the storage of the commodity; and
                              (ii) the handling and transportation costs in
                            making delivery of the commodity to designated
                            agencies at 1 or more central locations in each
                            State or other area.
              (4) Efficient operations.--Paragraph (1) shall not apply to
            the sale of a commodity the disposition of which is desirable
            in the interest of the effective and efficient conduct of the
            operations of the Corporation because of the small quantity of
            the commodity involved, or because of the age, location, or
            questionable continued storability of the commodity.

    SEC. 105. PAYMENT LIMITATIONS.

      (a) In General.--Section 1001 of the Food Security Act of 1985 (7
    U.S.C. 1308) is amended by striking paragraphs (1) through (4) and
    inserting the following:
              ``(1) Limitation on payments under production flexibility
            contracts.--The total amount of contract payments made under
            section 103 of the Agricultural Market Transition Act to a
            person under 1 or more production flexibility contracts entered
            into under the section during any fiscal year may not exceed
            $40,000.
              ``(2) Limitation on marketing loan gains and loan deficiency
            payments.--For each of the 1996 through 2002 crops of loan
            commodities, the total amount of payments specified in
            paragraph (3) that a person shall be entitled to receive under
            section 104 of the Agricultural Market Transition Act for one
            or more loan commodities may not exceed $75,000.
              ``(3) Description of payments subject to limitation.--The
            payments referred to in paragraph (2) are the following:
                      ``(A) Any gain realized by a producer from repaying a
                    marketing assistance loan for a crop of any loan
                    commodity at a lower level than the original loan rate
                    established for the loan commodity under section 104(b)
                    of the Agricultural Market Transition Act.
                      ``(B) Any loan deficiency payment received for a loan
                    commodity under section 104(e) of the Act.
              ``(4) Definitions.--In this title, the terms `contract
            payment' and `loan commodity' have the meaning given those
            terms in section 102 of the Agricultural Market Transition
            Act.''.
      (b) Conforming Amendments.--
              (1) Section 1001A of the Food Security Act of 1985 (7 U.S.C.
            1308-1) is amended--
                      (A) in subsection (a)(1), by striking ``under the
                    Agricultural Act of 1949 (7 U.S.C. 1421 et seq.)''; and
                      (B) in subsection (b)(1), by striking ``under the
                    Agricultural Act of 1949''.
              (2) Section 1001C(a) of the Act (7 U.S.C. 1308-3(a)) is
            amended--
                      (A) by striking ``For each of the 1991 through 1997
                    crops, any'' and inserting ``Any'';
                      (B) by striking ``production adjustment payments,
                    price support program loans, payments, or benefits made
                    available under the Agricultural Act of 1949 (7 U.S.C.
                    1421 et seq.),'' and inserting ``loans or payments made
                    available under title I of the Agricultural Market
                    Transition Act,''; and
                      (C) by striking ``during the 1989 through 1997 crop
                    years''.

    SEC. 106. PEANUT PROGRAM.

      (a) Quota Peanuts.--
              (1) Availability of loans.--The Secretary shall make
            nonrecourse loans available to producers of quota peanuts.
              (2) Loan rate.--The national average quota loan rate for
            quota peanuts shall be $610 per ton.
              (3) Inspection, handling, or storage.--The loan amount may
            not be reduced by the Secretary by any deductions for
            inspection, handling, or storage.
              (4) Location and other factors.--The Secretary may make
            adjustments in the loan rate for quota peanuts for location of
            peanuts and such other factors as are authorized by section 411
            of the Agricultural Adjustment Act of 1938.
              (5) Offers from handlers.--In the case of any producer who
            had an offer available from a handler to purchase quota
            peanuts, for delivery within the same county or a contiguous
            county, at a price equal to or greater than the applicable
            quota support rate, the Secretary shall reduce the support rate
            by 5 percent for the peanuts that were subject to the offer.
      (b) Additional Peanuts.--
              (1) In general.--The Secretary shall make nonrecourse loans
            available to producers of additional peanuts at such rates as
            the Secretary finds appropriate, taking into consideration the
            demand for peanut oil and peanut meal, expected prices of other
            vegetable oils and protein meals, and the demand for peanuts in
            foreign markets.
              (2) Announcement.--The Secretary shall announce the loan rate
            for additional peanuts of each crop not later than February 15
            preceding the marketing year for the crop for which the loan
            rate is being determined.
      (c) Area Marketing Associations.--
              (1) Warehouse storage loans.--
                      (A) In general.--In carrying out subsections (a) and
                    (b), the Secretary shall make warehouse storage loans
                    available in each of the producing areas (described in
                    section 1446.95 of title 7 of the Code of Federal
                    Regulations (January 1, 1989)) to a designated area
                    marketing association of peanut producers that is
                    selected and approved by the Secretary and that is
                    operated primarily for the purpose of conducting the
                    loan activities. The Secretary may not make warehouse
                    storage loans available to any cooperative that is
                    engaged in operations or activities concerning peanuts
                    other than those operations and activities specified in
                    this section and section 358e of the Agricultural
                    Adjustment Act of 1938 (7 U.S.C. 1359a).
                      (B) Administrative and supervisory activities.--An
                    area marketing association shall be used in
                    administrative and supervisory activities relating to
                    loans and marketing activities under this section and
                    section 358e of the Agricultural Adjustment Act of 1938
                    (7 U.S.C. 1359a).
                      (C) Association costs.--Loans made to the association
                    under this paragraph shall include such costs as the
                    area marketing association reasonably may incur in
                    carrying out the responsibilities, operations, and
                    activities of the association under this section and
                    section 358e of the Agricultural Adjustment Act of 1938
                    (7 U.S.C. 1359a).
              (2) Pools for quota and additional peanuts.--
                      (A) In general.--The Secretary shall require that
                    each area marketing association establish pools and
                    maintain complete and accurate records by area and
                    segregation for quota peanuts handled under loan and
                    for additional peanuts placed under loan, except that
                    separate pools shall be established for Valencia
                    peanuts produced in New Mexico. Bright hull and dark
                    hull Valencia peanuts shall be considered as separate
                    types for the purpose of establishing the pools.
                      (B) Net gains.--Net gains on peanuts in each pool,
                    unless otherwise approved by the Secretary, shall be
                    distributed only to producers who placed peanuts in the
                    pool and shall be distributed in proportion to the
                    value of the peanuts placed in the pool by each
                    producer. Net gains for peanuts in each pool shall
                    consist of the following:
                              (i) Quota peanuts.--For quota peanuts, the
                            net gains over and above the loan indebtedness
                            and other costs or losses incurred on peanuts
                            placed in the pool.
                              (ii) Additional peanuts.--For additional
                            peanuts, the net gains over and above the loan
                            indebtedness and other costs or losses incurred
                            on peanuts placed in the pool for additional
                            peanuts.
      (d) Losses.--Losses in quota area pools shall be covered using the
    following sources in the following order of priority:
              (1) Transfers from additional loan pools.--The proceeds due
            any producer from any pool shall be reduced by the amount of
            any loss that is incurred with respect to peanuts transferred
            from an additional loan pool to a quota loan pool by the
            producer under section 358-1(b)(8) of the Agricultural
            Adjustment Act of 1938 (7 U.S.C. 1358-1(b)(8)).
              (2) Other producers in same pool.--Further losses in an area
            quota pool shall be offset by reducing the gain of any producer
            in the pool by the amount of pool gains attributed to the same
            producer from the sale of additional peanuts for domestic and
            export edible use.
              (3) Buy-back gains within area.--Further losses in an area
            quota pool shall be offset by gains or profits attributable to
            sales of additional peanuts in that area pursuant to the
            provisions of section 358e(g)(1)(A) of the Agricultural
            Adjustment Act of 1938 (7 U.S.C. 1359a(g)(1)(A)).
              (4) Use of marketing assessments.--The Secretary shall use
            funds collected under subsection (g) (except funds attributable
            to handlers) to offset further losses in area quota pools. The
            Secretary shall transfer to the Treasury those funds collected
            under subsection (g) and available for use under this
            subsection that the Secretary determines are not required to
            cover losses in area quota pools.
              (5) Cross compliance.--Further losses in area quota pools,
            other than losses incurred as a result of transfers from
            additional loan pools to quota loan pools under section 358-
            1(b)(8) of the Agricultural Adjustment Act of 1938 (7 U.S.C.
            1358-1(b)(8)), shall be offset by any gains or profits from
            quota pools in other production areas (other than separate type
            pools established under subsection (c)(2)(A) for Valencia
            peanuts produced in New Mexico) in such manner as the Secretary
            shall by regulation prescribe. If losses in area quota pools
            have not been entirely offset through use of the preceding
            sentence, then further losses shall be offset by gains or
            profits attributable to sales of additional peanuts in other
            areas pursuant to section 358e(g)(1)(A) of such Act (7 U.S.C.
            1359a(g)(1)(A)).
              (6) Increased assessments.--If use of the authorities
            provided in the preceding paragraphs is not sufficient to cover
            losses in an area quota pool, the Secretary shall increase the
            marketing assessment established under subsection (g) by such
            an amount as the Secretary considers necessary to cover the
            losses. The increased assessment shall apply only to quota
            peanuts covered by that pool. Amounts collected under
            subsection (g) as a result of the increased assessment shall be
            retained by the Secretary to cover losses in that pool.
      (e) Disapproval of Quotas.--Notwithstanding any other provision of
    law, no loan for quota peanuts may be made available by the Secretary
    for any crop of peanuts with respect to which poundage quotas have been
    disapproved by producers, as provided for in section 358-1(d) of the
    Agricultural Adjustment Act of 1938 (7 U.S.C. 1358-1(d)).
      (f) Quality Improvement.--
              (1) In general.--With respect to peanuts under loan, the
            Secretary shall--
                      (A) promote the crushing of peanuts at a greater risk
                    of deterioration before peanuts of a lesser risk of
                    deterioration;
                      (B) ensure that all Commodity Credit Corporation
                    inventories of peanuts sold for domestic edible use
                    must be shown to have been officially inspected by
                    licensed Department inspectors both as farmer stock and
                    shelled or cleaned in-shell peanuts;
                      (C) continue to endeavor to operate the peanut
                    program so as to improve the quality of domestic
                    peanuts and ensure the coordination of activities under
                    the Peanut Administrative Committee established under
                    Marketing Agreement No. 146, regulating the quality of
                    domestically produced peanuts (under the Agricultural
                    Adjustment Act (7 U.S.C. 601 et seq.), reenacted with
                    amendments by the Agricultural Marketing Agreement Act
                    of 1937); and
                      (D) ensure that any changes made in the peanut
                    program as a result of this subsection requiring
                    additional production or handling at the farm level
                    shall be reflected as an upward adjustment in the
                    Department loan schedule.
              (2) Exports and other peanuts.--The Secretary shall require
            that all peanuts in the domestic and export markets fully
            comply with all quality standards under Marketing Agreement No.
            146.
      (g) Marketing Assessment.--
              (1) In general.--The Secretary shall provide for a
            nonrefundable marketing assessment. The assessment shall be
            made on a per pound basis in an amount equal to 1.1 percent for
            each of the 1994 and 1995 crops, 1.15 percent for the 1996
            crop, and 1.2 percent for each of the 1997 through 2002 crops,
            of the national average quota or additional peanut loan rate
            for the applicable crop.
              (2) First purchasers.--
                      (A) In general.--Except as provided under paragraphs
                    (3) and (4), the first purchaser of peanuts shall--
                              (i) collect from the producer a marketing
                            assessment equal to the quantity of peanuts
                            acquired multiplied by--
                                      (I) in the case of each of the 1994
                                    and 1995 crops, .55 percent of the
                                    applicable national average loan rate;
                                      (II) in the case of the 1996 crop, .6
                                    percent of the applicable national
                                    average loan rate; and
                                      (III) in the case of each of the 1997
                                    through 2002 crops, .65 percent of the
                                    applicable national average loan rate;
                              (ii) pay, in addition to the amount collected
                            under clause (i), a marketing assessment in an
                            amount equal to the quantity of peanuts
                            acquired multiplied by .55 percent of the
                            applicable national average loan rate; and
                              (iii) remit the amounts required under
                            clauses (i) and (ii) to the Commodity Credit
                            Corporation in a manner specified by the
                            Secretary.
                      (B) Definition of first purchaser.--In this
                    subsection, the term ``first purchaser'' means a person
                    acquiring peanuts from a producer except that in the
                    case of peanuts forfeited by a producer to the
                    Commodity Credit Corporation, the term means the person
                    acquiring the peanuts from the Commodity Credit
                    Corporation.
              (3) Other private marketings.--In the case of a private
            marketing by a producer directly to a consumer through a retail
            or wholesale outlet or in the case of a marketing by the
            producer outside of the continental United States, the producer
            shall be responsible for the full amount of the assessment and
            shall remit the assessment by such time as is specified by the
            Secretary.
              (4) Loan peanuts.--In the case of peanuts that are pledged as
            collateral for a loan made under this section, \1/2\ of the
            assessment shall be deducted from the proceeds of the loan. The
            remainder of the assessment shall be paid by the first
            purchaser of the peanuts. For purposes of computing net gains
            on peanuts under this section, the reduction in loan proceeds
            shall be treated as having been paid to the producer.
              (5) Penalties.--If any person fails to collect or remit the
            reduction required by this subsection or fails to comply with
            the requirements for recordkeeping or otherwise as are required
            by the Secretary to carry out this subsection, the person shall
            be liable to the Secretary for a civil penalty up to an amount
            determined by multiplying--
                      (A) the quantity of peanuts involved in the
                    violation; by
                      (B) the national average quota peanut rate for the
                    applicable crop year.
              (6) Enforcement.--The Secretary may enforce this subsection
            in the courts of the United States.
      (h) Crops.--Subsections (a) through (f) shall be effective only for
    the 1996 through 2002 crops of peanuts.
      (i) Marketing Quotas.--
              (1) In general.--Part VI of subtitle B of title III of the
            Agricultural Adjustment Act of 1938 is amended--
                      (A) in section 358-1 (7 U.S.C. 1358-1)--
                              (i) in the section heading, by striking
                            ``1991 through 1997 crops of'';
                              (ii) in subsections (a)(1), (b)(1)(B),
                            (b)(2)(A), (b)(2)(C), and (b)(3)(A), by
                            striking ``of the 1991 through 1997 marketing
                            years'' each place it appears and inserting
                            ``marketing year'';
                              (iii) in subsection (a)(3), by striking
                            ``1990'' and inserting ``1990, for the 1991
                            through 1995 marketing years, and 1995, for the
                            1996 through 2002 marketing years'';
                              (iv) in subsection (b)(1)(A)--
                                      (I) by striking ``each of the 1991
                                    through 1997 marketing years'' and
                                    inserting ``each marketing year''; and
                                      (II) in clause (i), by inserting
                                    before the semicolon the following: ``,
                                    in the case of the 1991 through 1995
                                    marketing years, and the 1995 marketing
                                    year, in the case of the 1996 through
                                    2002 marketing years''; and
                              (v) in subsection (f), by striking ``1997''
                            and inserting ``2002'';
                      (B) in section 358b (7 U.S.C. 1358b)--
                              (i) in the section heading, by striking
                            ``1991 through 1995 crops of''; and
                              (ii) in subsection (c), by striking ``1995''
                            and inserting ``2002'';
                      (C) in section 358c(d) (7 U.S.C. 1358c(d)), by
                    striking ``1995'' and inserting ``2002''; and
                      (D) in section 358e (7 U.S.C. 1359a)--
                              (i) in the section heading, by striking
                            ``for 1991 through 1997 crops of
                            peanuts''; and
                              (ii) in subsection (i), by striking ``1997''
                            and inserting ``2002''.
              (2) Eligibility for farm poundage quota.--
                      (A) Certain farms ineligible.--Section 358-1(b)(1) of
                    the Act (7 U.S.C. 1358-1(b)(1)) is amended by adding at
                    the end the following:
                      ``(D) Certain farms ineligible to hold quota.--
                    Effective beginning with the 1997 marketing year, the
                    Secretary shall no longer establish farm poundage
                    quotas under subparagraph (A) for farms--
                              ``(i) owned or controlled by municipalities,
                            airport authorities, schools, colleges,
                            refuges, and other public entities (not
                            including universities for research purposes);
                            or
                              ``(ii) owned or controlled by a person who is
                            not a producer and resides in another State.''.
                      (B) Allocation of quota to other farms.--Section 358-
                    1(b)(2) of the Act (7 U.S.C. 1358-1(b)(2)) is amended
                    by adding at the end the following:
                      ``(E) Transfer of quota from ineligible farms.--Any
                    farm poundage quota held at the end of the 1996
                    marketing year by a farm described in paragraph (1)(D)
                    shall be allocated to other farms in the same State on
                    such basis as the Secretary may by regulation
                    prescribe.''.
              (3) Elimination of quota floor.--Section 358-1(a)(1) of the
            Act (7 U.S.C. 1358-1(a)(1)) is amended by striking the second
            sentence.
              (4) Temporary quota allocation.--Section 358-1 of the Act (7
            U.S.C. 1358-1) is amended--
                      (A) in subsection (a)(1), by striking ``domestic
                    edible, seed,'' and inserting ``domestic edible use'';
                      (B) in subsection (b)(2)--
                              (i) in subparagraph (A), by striking
                            ``subparagraph (B) and subject to''; and
                              (ii) by striking subparagraph (B) and
                            inserting the following:
                      ``(B) Temporary quota allocation.--
                              ``(i) Allocation related to seed peanuts.--
                            Temporary allocation of quota pounds for the
                            marketing year only in which the crop is
                            planted shall be made to producers for each of
                            the 1996 through 2002 marketing years as
                            provided in this subparagraph.
                              ``(ii) Quantity.--The temporary quota
                            allocation shall be equal to the pounds of seed
                            peanuts planted on the farm, as may be adjusted
                            under regulations prescribed by the Secretary.
                              ``(iii) Additional quota.--The temporary
                            allocation of quota pounds under this paragraph
                            shall be in addition to the farm poundage quota
                            otherwise established under this subsection and
                            shall be credited, for the applicable marketing
                            year only, in total to the producer of the
                            peanuts on the farm in a manner prescribed by
                            the Secretary.
                              ``(iv) Effect of other requirements.--Nothing
                            in this section alters or changes the
                            requirements regarding the use of quota and
                            additional peanuts established by section
                            358e(b).''; and
                      (C) in subsection (e)(3), strike ``and seed and use
                    on a farm''.
              (5) Spring and fall transfers within a state.--Section
            358b(a)(1) of the Act (7 U.S.C. 1358b(a)(1)) is amended--
                      (A) by striking ``, conditions, or limitations'' in
                    the matter preceding the subparagraphs and inserting
                    ``and conditions'';
                      (B) by striking ``any such lease'' in the matter
                    preceding the subparagraphs and inserting ``any such
                    sale or lease''; and
                      (C) by striking ``in the fall or after the normal
                    planting season--'' and subparagraphs (A) and (B) and
                    inserting the following: ``in the spring (or before the
                    normal planting season) or in the fall (or after the
                    normal planting season) with the owner or operator of a
                    farm located within any county in the same State. In
                    the case of a fall transfer or a transfer after the
                    normal planting season, the transfer may be made only
                    if not less than 90 percent of the basic quota (the
                    farm quota exclusive of temporary quota transfers),
                    plus any poundage quota transferred to the farm under
                    this subsection, has been planted or considered planted
                    on the farm from which the quota is to be leased.''.
              (6) Undermarketings.--Part VI of subtitle B of title III of
            the Act is amended--
                      (A) in section 358-1(b) (7 U.S.C. 1358-1(b))--
                              (i) in paragraph (1)(B), by striking
                            ``including--'' and clauses (i) and (ii) and
                            inserting ``including any increases resulting
                            from the allocation of quotas voluntarily
                            released for 1 year under paragraph (7).'';
                              (ii) in paragraph (3)(B), by striking
                            ``include--'' and clauses (i) and (ii) and
                            inserting ``include any increase resulting from
                            the allocation of quotas voluntarily released
                            for 1 year under paragraph (7).''; and
                              (iii) by striking paragraphs (8) and (9); and
                      (B) in section 358b(a) (7 U.S.C. 1358b(a))--
                              (i) in paragraph (1), by striking
                            ``(including any applicable under marketings)''
                            both places it appears;
                              (ii) in paragraph (2), by striking
                            ``(including any applicable under
                            marketings)''; and
                              (iii) in paragraph (3), by striking
                            ``(including any applicable undermarketings)''.
              (7) Disaster transfers.--Section 358-1(b) of the Act (7
            U.S.C. 1358-1(b)), as amended by paragraph (6)(A)(iii), is
            further amended by adding at the end the following:
              ``(8) Disaster transfers.--
                      ``(A) In general.--Except as provided in subparagraph
                    (B), additional peanuts produced on a farm from which
                    the quota poundage was not harvested and marketed
                    because of drought, flood, or any other natural
                    disaster, or any other condition beyond the control of
                    the producer, may be transferred to the quota loan pool
                    for pricing purposes on such basis as the Secretary
                    shall by regulation provide.
                      ``(B) Limitation.--The poundage of peanuts
                    transferred under subparagraph (A) shall not exceed the
                    difference between--
                              ``(i) the total quantity of peanuts meeting
                            quality requirements for domestic edible use,
                            as determined by the Secretary, marketed from
                            the farm; and
                              ``(ii) the total farm poundage quota,
                            excluding quota pounds transferred to the farm
                            in the fall.
                      ``(C) Support rate.--Peanuts transferred under this
                    paragraph shall be supported at 70 percent of the quota
                    support rate for the marketing years in which the
                    transfers occur. The transfers for a farm shall not
                    exceed 25 percent of the total farm quota pounds,
                    excluding pounds transferred in the fall.''.

    SEC. 107. SUGAR PROGRAM.

      (a) Sugarcane.--The Secretary shall make loans available to
    processors of domestically grown sugarcane at a rate equal to 18 cents
    per pound for raw cane sugar.
      (b) Sugar Beets.--The Secretary shall make loans available to
    processors of domestically grown sugar beets at a rate equal to 22.9
    cents per pound for refined beet sugar.
      (c) Reduction in Loan Rates.--
              (1) Reduction required.--The Secretary shall reduce the loan
            rate specified in subsection (a) for domestically grown
            sugarcane and subsection (b) for domestically grown sugar beets
            if the Secretary determines that negotiated reductions in
            export subsidies and domestic subsidies provided for sugar of
            the European Union and other major sugar growing, producing,
            and exporting countries in the aggregate exceed the commitments
            made as part of the Agreement on Agriculture.
              (2) Extent of reduction.--The Secretary shall not reduce the
            loan rate under subsection (a) or (b) below a rate that
            provides an equal measure of support to that provided by the
            European Union and other major sugar growing, producing, and
            exporting countries, based on an examination of both domestic
            and export subsidies subject to reduction in the Agreement on
            Agriculture.
              (3) Announcement of reduction.--The Secretary shall announce
            any loan rate reduction to be made under this subsection as far
            in advance as is practicable.
              (4) Major sugar countries defined.--For purposes of this
            subsection, the term ``major sugar growing, producing, and
            exporting countries'' means--
                      (A) the countries of the European Union; and
                      (B) the ten foreign countries not covered by
                    subparagraph (A) that the Secretary determines produce
                    the greatest amount of sugar.
              (5) Agreement on agriculture defined.--For purposes of this
            subsection, the term ``Agreement on Agriculture'' means the
            Agreement on Agriculture referred to in section 101(d)(2) of
            the Uruguay Round Agreements Act (19 U.S.C. 3511(d)(2)).
      (d) Term of Loans.--
              (1) In general.--Loans under this section during any fiscal
            year shall be made available not earlier than the beginning of
            the fiscal year and shall mature at the earlier of--
                      (A) the end of 9 months; or
                      (B) the end of the fiscal year.
              (2) Supplemental loans.--In the case of loans made under this
            section in the last 3 months of a fiscal year, the processor
            may repledge the sugar as collateral for a second loan in the
            subsequent fiscal year, except that the second loan shall--
                      (A) be made at the loan rate in effect at the time
                    the second loan is made; and
                      (B) mature in 9 months less the quantity of time that
                    the first loan was in effect.
      (e) Loan Type; Processor Assurances.--
              (1) Recourse loans.--Subject to paragraph (2), the Secretary
            shall carry out this section through the use of recourse loans.
              (2) Nonrecourse loans.--During any fiscal year in which the
            tariff rate quota for imports of sugar into the United States
            is established at, or is increased to, a level in excess of
            1,500,000 short tons raw value, the Secretary shall carry out
            this section by making available nonrecourse loans. Any
            recourse loan previously made available by the Secretary under
            this section during the fiscal year shall be changed by the
            Secretary into a nonrecourse loan.
              (3) Processor assurances.--If the Secretary is required under
            paragraph (2) to make nonrecourse loans available during a
            fiscal year or to change recourse loans into nonrecourse loans,
            the Secretary shall obtain from each processor that receives a
            loan under this section such assurances as the Secretary
            considers adequate to ensure that the processor will provide
            payments to producers that are proportional to the value of the
            loan received by the processor for sugar beets and sugarcane
            delivered by producers served by the processor. The Secretary
            may establish appropriate minimum payments for purposes of this
            paragraph.
      (f) Marketing Assessment.--
              (1) Sugarcane.--Effective for marketings of raw cane sugar
            during the 1996 through 2003 fiscal years, the first processor
            of sugarcane shall remit to the Commodity Credit Corporation a
            nonrefundable marketing assessment in an amount equal to--
                      (A) in the case of marketings during fiscal year
                    1996, 1.1 percent of the loan rate established under
                    subsection (a) per pound of raw cane sugar, processed
                    by the processor from domestically produced sugarcane
                    or sugarcane molasses, that has been marketed
                    (including the transfer or delivery of the sugar to a
                    refinery for further processing or marketing); and
                      (B) in the case of marketings during each of fiscal
                    years 1997 through 2003, 1.375 percent of the loan rate
                    established under subsection (a) per pound of raw cane
                    sugar, processed by the processor from domestically
                    produced sugarcane or sugarcane molasses, that has been
                    marketed (including the transfer or delivery of the
                    sugar to a refinery for further processing or
                    marketing).
              (2) Sugar beets.--Effective for marketings of beet sugar
            during the 1996 through 2003 fiscal years, the first processor
            of sugar beets shall remit to the Commodity Credit Corporation
            a nonrefundable marketing assessment in an amount equal to--
                      (A) in the case of marketings during fiscal year
                    1996, 1.1794 percent of the loan rate established under
                    subsection (a) per pound of beet sugar, processed by
                    the processor from domestically produced sugar beets or
                    sugar beet molasses, that has been marketed; and
                      (B) in the case of marketings during each of fiscal
                    years 1997 through 2003, 1.47425 percent of the loan
                    rate established under subsection (a) per pound of beet
                    sugar, processed by the processor from domestically
                    produced sugar beets or sugar beet molasses, that has
                    been marketed.
              (3) Collection.--
                      (A) Timing.--A marketing assessment required under
                    this subsection shall be collected on a monthly basis
                    and shall be remitted to the Commodity Credit
                    Corporation not later than 30 days after the end of
                    each month. Any cane sugar or beet sugar processed
                    during a fiscal year that has not been marketed by
                    September 30 of the year shall be subject to assessment
                    on that date. The sugar shall not be subject to a
                    second assessment at the time that it is marketed.
                      (B) Manner.--Subject to subparagraph (A), marketing
                    assessments shall be collected under this subsection in
                    the manner prescribed by the Secretary and shall be
                    nonrefundable.
              (4) Penalties.--If any person fails to remit the assessment
            required by this subsection or fails to comply with such
            requirements for recordkeeping or otherwise as are required by
            the Secretary to carry out this subsection, the person shall be
            liable to the Secretary for a civil penalty up to an amount
            determined by multiplying--
                      (A) the quantity of cane sugar or beet sugar involved
                    in the violation; by
                      (B) the loan rate for the applicable crop of
                    sugarcane or sugar beets.
              (5) Enforcement.--The Secretary may enforce this subsection
            in a court of the United States.
      (g) Forfeiture Penalty.--
              (1) In general.--A penalty shall be assessed on the
            forfeiture of any sugar pledged as collateral for a nonrecourse
            loan under this section.
              (2) Cane sugar.--The penalty for cane sugar shall be 1 cent
            per pound.
              (3) Beet sugar.--The penalty for beet sugar shall bear the
            same relation to the penalty for cane sugar as the marketing
            assessment for sugar beets bears to the marketing assessment
            for sugarcane.
              (4) Effect of forfeiture.--Any payments owed producers by a
            processor that forfeits of any sugar pledged as collateral for
            a nonrecourse loan shall be reduced in proportion to the loan
            forfeiture penalty incurred by the processor.
      (h) Information Reporting.--
              (1) Duty of processors and refiners to report.--A sugarcane
            processor, cane sugar refiner, and sugar beet processor shall
            furnish the Secretary, on a monthly basis, such information as
            the Secretary may require to administer sugar programs,
            including the quantity of purchases of sugarcane, sugar beets,
            and sugar, and production, importation, distribution, and stock
            levels of sugar.
              (2) Penalty.--Any person willfully failing or refusing to
            furnish the information, or furnishing willfully any false
            information, shall be subject to a civil penalty of not more
            than $10,000 for each such violation.
              (3) Monthly reports.--Taking into consideration the
            information received under paragraph (1), the Secretary shall
            publish on a monthly basis composite data on production,
            imports, distribution, and stock levels of sugar.
      (i) Marketing Allotments.--Part VII of subtitle B of title III of the
    Agricultural Adjustment Act of 1938 (7 U.S.C. 1359aa et seq.) is
    repealed.
      (j) Crops.--This section (other than subsection (i)) shall be
    effective only for the 1996 through 2002 crops of sugar beets and
    sugarcane.

    SEC. 108. ADMINISTRATION.

      (a) Commodity Credit Corporation.--
              (1) Use of corporation.--The Secretary shall carry out this
            title through the Commodity Credit Corporation.
              (2) Prohibition on salaries and expenses.--Notwithstanding
            any other provision of law, no funds of the Corporation shall
            be used for any salary or expense of any officer or employee of
            the Department of Agriculture.
      (b) Determinations by Secretary.--A determination made by the
    Secretary under this title or the Agricultural Adjustment Act of 1938
    (7 U.S.C. 1281 et seq.) shall be final and conclusive.
      (c) Regulations.--The Secretary may issue such regulations as the
    Secretary determines necessary to carry out this title.

    SEC. 109. ELIMINATION OF PERMANENT PRICE SUPPORT AUTHORITY.

      (a) Agricultural Adjustment Act of 1938.--The Agricultural Adjustment
    Act of 1938 is amended--
              (1) in title III--
                      (A) in subtitle B--
                              (i) by striking parts II through V (7 U.S.C.
                            1326-1351); and
                              (ii) in part VI--
                                      (I) by moving subsection (c) of
                                    section 358d (7 U.S.C. 1358d(c)) to
                                    appear after section 301(b)(17) (7
                                    U.S.C. 1301(b)(17)), redesignating the
                                    subsection as paragraph (18), and
                                    moving the margin of the paragraph 2
                                    ems to the right; and
                                      (II) by striking sections 358, 358a,
                                    and 358d (7 U.S.C. 1358, 1358a, and
                                    1359); and
                      (B) by striking subtitle D (7 U.S.C. 1379a-1379j);
                    and
              (2) by striking title IV (7 U.S.C. 1401-1407).
      (b) Agricultural Act of 1949.--
              (1) Transfer of certain sections.--The Agricultural Act of
            1949 is amended--
                      (A) by transferring sections 106, 106A, and 106B (7
                    U.S.C. 1445, 1445-1, 1445-2) to appear after section
                    314A of the Agricultural Adjustment Act of 1938 (7
                    U.S.C. 1314-1) and redesignating the transferred
                    sections as sections 315, 315A, and 315B, respectively;
                      (B) by transferring section 111 (7 U.S.C. 1445f) to
                    appear after section 304 of the Agricultural Adjustment
                    Act of 1938 (7 U.S.C. 1304) and redesignating the
                    transferred section as section 305; and
                      (C) by transferring sections 404 and 416 (7 U.S.C.
                    1424 and 1431) to appear after section 390 of the
                    Agricultural Adjustment Act of 1938 (7 U.S.C. 1390) and
                    redesignating the transferred sections as sections 390A
                    and 390B, respectively.
              (2) Repeal.--The Agricultural Act of 1949 (7 U.S.C. 1421 et
            seq.) (as amended by paragraph (1)) is repealed.
      (c) Conforming Amendments.--
              (1) Section 361 of the Agricultural Adjustment Act of 1938 (7
            U.S.C. 1361) is amended by striking ``, corn, wheat, cotton,
            peanuts, and rice, established''.
              (2) Section 371 of the Agricultural Adjustment Act of 1938 (7
            U.S.C. 1371) is amended--
                      (A) in the first sentence of subsection (a), by
                    striking ``cotton, rice, peanuts, or''; and
                      (B) in the first sentence of subsection (b), by
                    striking ``cotton, rice, peanuts or''.

    SEC. 110. EFFECT OF AMENDMENTS.

      (a) Effect on Prior Crops.--Except as otherwise specifically provided
    and notwithstanding any other provision of law, this title and the
    amendments made by this title shall not affect the authority of the
    Secretary to carry out a price support or production adjustment program
    for any of the 1991 through 1995 crops of an agricultural commodity
    established under a provision of law in effect immediately before the
    date of the enactment of this Act.
      (b) Liability.--A provision of this title or an amendment made by
    this title shall not affect the liability of any person under any
    provision of law as in effect before the date of the enactment of this
    Act.

                                TITLE II--DAIRY

              Subtitle A--Milk Price Support and Other Activities

    SEC. 201. MILK PRICE SUPPORT PROGRAM.

      (a) Support Activities.--To replace the milk price support program
    established under section 204 of the Agricultural Act of 1949 (7 U.S.C.
    1446e), which is repealed by section 109(b)(2)), the Secretary of
    Agriculture shall use the authority provided in this section to support
    the price of milk produced in the 48 contiguous States through the
    purchase of cheddar cheese produced from such milk. Until the first day
    of the first month beginning not less than 30 days after the date of
    the enactment of this Act, the Secretary also may support the price of
    milk under this section through the purchase of butter and nonfat dry
    milk produced from milk produced in the 48 contiguous States.
      (b) Rate.--The price of milk shall be supported at the following
    rates per hundredweight for milk containing 3.67 percent butterfat:
              (1) During calendar year 1996, not less than $10.35.
              (2) During calendar year 1997, not less than $10.25.
              (3) During calendar year 1998, not less than $10.15.
              (4) During calendar year 1999, not less than $10.05.
              (5) During calendar year 2000, not less than $9.95.
              (6) During calendar years 2001 and 2002, not less than $9.85.
      (c) Bid Prices.--The Commodity Credit Corporation support purchase
    prices under this section for cheddar cheese (and for butter and nonfat
    dry milk subject to subsection (a)) announced by the Corporation shall
    be the same for all of that milk product sold by persons offering to
    sell the product to the Corporation. The purchase prices shall be
    sufficient to enable plants of average efficiency to pay producers, on
    average, a price not less than the rate of price support for milk in
    effect during a 12-month period under this section.
      (d) Use of Commodity Credit Corporation.--The Secretary shall use the
    funds, facilities, and authorities of the Commodity Credit Corporation
    to carry out this section.
      (e) Residual Authority for Refund of Budget Deficit Assessments.--
              (1) Application of subsection.--This subsection shall apply
            with respect to the reductions made under subsection (h)(2) of
            section 204 of the Agricultural Act of 1949, as in effect on
            the day before the date of the enactment of this Act, in the
            price of milk received by producers during calendar years 1995
            and 1996.
              (2) Refund required.--The Secretary shall provide a refund of
            the entire reduction made under such subsection (h)(2) in the
            price of milk received by a producer during a calendar year
            referred to in paragraph (1) if the producer provides evidence
            that the producer did not increase marketings in that calendar
            year when compared to the preceding calendar year.
              (3) Treatment of refunds.--A refund under this subsection
            shall not be considered as any type of price support or payment
            for purposes of sections 1211 and 1221 of the Food Security Act
            of 1985 (16 U.S.C. 3811, 3821).
      (g) Transfer of Milk Products to Military and Veterans Hospitals.--
              (1) Transfer authorized.--As a means of increasing the
            utilization of milk and milk products, upon the certification
            by the Secretary of Veterans Affairs or by the Secretary of the
            Army, acting for the military departments under the Single
            Service Purchase Assignment for Subsistence of the Department
            of Defense, that the usual quantities of milk products have
            been purchased in the normal channels of trade, the Commodity
            Credit Corporation shall make available--
                      (A) to the Secretary of Veterans Affairs at
                    warehouses where milk products are stored, such milk
                    products acquired under this section as the Secretary
                    of Veterans Affairs certifies are required in order to
                    provide milk products as a part of the ration in
                    hospitals under the jurisdiction of the Secretary of
                    Veterans Affairs; and
                      (B) to the Secretary of the Army, at warehouses where
                    milk products are stored, such milk products acquired
                    under this section as the Secretary of the Army
                    certifies can be utilized in order to provide
                    additional milk products as a part of the ration--
                              (i) of the Army, Navy, Air Force, or Coast
                            Guard;
                              (ii) in hospitals under the jurisdiction of
                            the Department of Defense; and
                              (iii) of cadets and midshipmen at, and other
                            personnel assigned to, the United States
                            Merchant Marine Academy.
              (2) Reports.--The Secretary of Veterans Affairs and the
            Secretary of the Army shall report every six months to the
            Committee on Agriculture, Nutrition, and Forestry of the Senate
            and the Committee on Agriculture of the House of
            Representatives and the Secretary of Agriculture the amount of
            milk products used under this subsection.
              (3) Process.--The Secretary of Veterans Affairs and the
            Secretary of the Army shall reimburse the Commodity Credit
            Corporation for all costs associated in making milk products
            available under this subsection.
              (4) Limitation.--The obligation of the Commodity Credit
            Corporation to make milk products available pursuant to this
            subsection shall be limited to milk products acquired by the
            Corporation under this section and not disposed of under
            provisions (1) and (2) of section 390B(a) of the Agricultural
            Adjustment Act of 1938.
      (h) Period of Effectiveness.--Notwithstanding any other provision of
    law, this section shall be effective only during the period
              (1) beginning on the date of the enactment of this Act; and
              (2) ending on December 31, 2002.

    SEC. 202. RECOURSE LOANS FOR COMMERCIAL PROCESSORS OF DAIRY PRODUCTS.

      (a) Recourse Loans Available.--The Secretary of Agriculture shall
    make recourse loans available to commercial processors of eligible
    dairy products to assist such processors to manage inventories of
    eligible dairy products to assure a greater degree of price stability
    for the dairy industry during the year. Recourse loans may be made
    available under such reasonable terms and conditions as the Secretary
    may prescribe. The Secretary shall use the funds, facilities, and
    authorities of the Commodity Credit Corporation to carry out this
    section.
      (b) Amount of Loan.--The Secretary shall establish the amount of a
    loan for eligible dairy products, which shall reflect 90 percent of the
    reference price for that product. The rate of interest charged
    participants in this program shall not be less than the rate of
    interest charged the Commodity Credit Corporation by the United States
    Treasury.
      (c) Period of Loans.--A recourse loan made under this section may not
    extend beyond the end of the fiscal year during which the loan is made,
    except that the Secretary may extend the loan for an additional period
    not to exceed the end of the next fiscal year.
      (d) Definitions.--In this section:
              (1) The term ``eligible dairy products'' means cheddar
            cheese, butter, and nonfat dry milk.
              (2) The term ``reference price'' means--
                      (A) for cheddar cheese, the average National (Green
                    Bay) Cheese Exchange price for 40 pound blocks of
                    cheddar cheese for the previous three months;
                      (B) for butter, the average Chicago Mercantile
                    Exchange price for Grade AA butter for the previous
                    three months; and
                      (C) for nonfat dry milk, the average Western States
                    Extra Grade and Grade A price for nonfat dry milk for
                    the previous three months.

    SEC. 203. DAIRY EXPORT INCENTIVE PROGRAM.

      (a) Duration.--Subsection (a) of section 153 of the Food Security Act
    of 1985 (15 U.S.C. 713a-14) is amended by striking ``2001'' and
    inserting ``2002''.
      (b) Elements of Program.--Subsection (c) of such section is amended--
              (1) by striking ``and'' at the end of paragraph (1);
              (2) by striking the period at the end of paragraph (2) and
            inserting ``; and''; and
              (3) by adding at the end the following new paragraphs:
              ``(3) the maximum volume of dairy product exports allowable
            consistent with the obligations of the United States as a
            member of the World Trade Organization are exported under the
            program each year (minus the volume sold under section 1163 of
            this Act (7 U.S.C. 1731 note) during that year), except to the
            extent that the export of such a volume under the program
            would, in the judgment of the Secretary, exceed the limitations
            on the value set forth in subsection (f); and
              ``(4) payments may be made under the program for exports to
            any destination in the world for the purpose of market
            development, except a destination in a country with respect to
            which shipments from the United States are otherwise restricted
            by law.''.
      (c) Sole Discretion.--Subsection (b) of such section is amended by
    inserting ``sole'' before ``discretion''.
      (d) Market Development.--Subsection (e)(1) of such section is
    amended--
              (1) by striking ``and'' and inserting ``the''; and
              (2) by inserting before the period the following: ``, and any
            additional amount that may be required to assist in the
            development of world markets for United States dairy
            products''.
      (e) Maximum Allowable Amounts.--Such section is further amended by
    adding at the end the following:
      ``(f) Required Funding.--The Commodity Credit Corporation shall in
    each year use money and commodities for the program under this section
    in the maximum amount consistent with the obligations of the United
    States as a member of the World Trade Organization, minus the amount
    expended under section 1163 of this Act (7 U.S.C. 1731 note) during
    that year. However, the Commodity Credit Corporation may not exceed the
    limitations specified in subsection (c)(3) on the volume of allowable
    dairy product exports.''.

    SEC. 204. DAIRY PROMOTION PROGRAM.

      (a) Expansion to Cover Dairy Products Imported into the United
    States.--Section 110(b) of the Dairy Production Stabilization Act of
    1983 (7 U.S.C. 4501(b)) is amended by inserting after ``commercial
    use'' the following: ``and dairy products imported into the United
    States''.
      (b) Definitions.--
              (1) Milk.--Subsection (d) of section 111 of such Act (7
            U.S.C. 4502) is amended by inserting before the semicolon the
            following: ``or cow's milk imported into the United States in
            the form of dairy products intended for consumption in the
            United States''.
              (2) Dairy products.--Subsection (e) of such section is
            amended by inserting before the semicolon the following: ``and
            casein (except casein imported under sections 3501.90.20
            (casein glue) and 3501.90.50 (other) of the Harmonized Tariff
            Schedule)''.
              (3) Research.--Subsection (j) of such section is amended by
            inserting before the semicolon the following: ``or to reduce
            the costs associated with processing or marketing those
            products''.
              (4) United states.--Subsection (l) of such section is amended
            to read as follows:
              ``(l) the term `United States' means the several States and
            the District of Columbia;''.
              (5) Importers and exporters.--Such section is further
            amended--
                      (A) in subsection (k), by striking ``and'' at the end
                    of such subsection; and
                      (B) by adding at the end the following new
                    subsections:
              ``(m) the term `importer' means the first person to take
            title to dairy products imported into the United States for
            domestic consumption; and
              ``(n) the term `exporter' means any person who exports dairy
            products from the United States.''.
      (c) Membership of Board.--Section 113(b) of such Act (7 U.S.C.
    4504(b)) is amended--
              (1) in the first sentence, by striking ``thirty-six members''
            and inserting ``38 members, including one representative of
            importers and one representative of exporters to be appointed
            by the Secretary'';
              (2) in the second sentence, by striking ``Members'' and
            inserting ``The remaining members''; and
              (3) in the third sentence, by striking ``United States'' and
            inserting ``United States, including Alaska and Hawaii''.
      (d) Assessment.--Section 113(g) of such Act (7 U.S.C. 4504(g)) is
    amended--
      (1) by inserting ``(1)'' after ``(g)''; and
      (2) by adding at the end the following new paragraph:
      ``(2) The order shall provide that each importer of dairy products
    intended for consumption in the United States shall remit to the Board,
    in the manner prescribed by the order, an assessment equal to 1.2 cents
    per pound of total milk solids contained in the imported dairy
    products, or 15 cents per hundredweight of milk contained in the
    imported dairy products, whichever is less. If an importer can
    establish that it is participating in active, ongoing qualified State
    or regional dairy product promotion or nutrition programs intended to
    increase the consumption of milk and dairy products, the importer shall
    receive credit in determining the assessment due from that importer for
    contributions to such programs of up to .8 cents per pound of total
    milk solids contained in the imported dairy products, or 10 cents per
    hundredweight of milk contained in the imported dairy products,
    whichever is less. The assessment collected under this paragraph shall
    be used for the purpose specified in paragraph (1).''.
      (e) Records.--Section 113(k) of such Act (7 U.S.C. 4504(k)) is
    amended in the first sentence by inserting after ``commercial use,''
    the following: ``each importer of dairy products,''.
      (f) Termination or Suspension of Order.--Section 116(b) of such Act
    (7 U.S.C. 4507(b)) is amended--
              (1) by inserting ``and importers'' after ``producers'' each
            place it appears;
              (2) by striking ``who, during a representative period (as
            determined by the Secretary), have been engaged in the
            production of milk for commercial use''; and
              (3) by adding at the end the following new sentences: ``A
            producer shall be eligible to vote in the referendum if the
            producer, during a representative period (as determined by the
            Secretary), has been engaged in the production of milk for
            commercial use. An importer shall be eligible to vote in the
            referendum if the importer, during a representative period (as
            determined by the Secretary), has been engaged in the
            importation of dairy products into the United States intended
            for consumption in the United States.''.
      (g) Promotion in international markets.--Section 113(e) of such Act
    (7 U.S.C. 4504(e)) is amended by adding at the end the following new
    sentence: ``For each of the fiscal years 1996 through 2000, the Board's
    budget shall provide for the expenditure of not less than 10 percent of
    the anticipated revenues available to the Board to develop
    international markets for, and to promote within such markets, the
    consumption of dairy products produced in the United States from milk
    produced in the United States.''.
      (h) Implementation of Amendments.--
              (1) Implementation process.--To implement the amendments made
            by this section, the Secretary of Agriculture shall issue an
            amended dairy products promotion and research order under
            section 112 of the Dairy Production Stabilization Act of 1983
            (7 U.S.C. 4503) reflecting such amendments, and no other
            changes, in the order in existence on the date of the enactment
            of this Act.
              (2) Proposal of amended order.--Not later than 60 days after
            the date of the enactment of this Act, the Secretary shall
            publish a proposed dairy products promotion and research order
            reflecting the amendments made by this section. The Secretary
            shall provide notice and an opportunity for public comment on
            the proposed order.
              (3) Issuance of amended order.--After notice and opportunity
            for public comment are provided in accordance with paragraph
            (2), the Secretary shall issue a final dairy products promotion
            and research order, taking into consideration the comments
            received and including in the order such provisions as are
            necessary to ensure that the order is in conformity with the
            amendments made by this section.
              (3) Issuance of amended order.--After notice and opportunity
            for public comment are provided in accordance with paragraph
            (2), the Secretary shall issue a final dairy products promotion
            and research order, taking into consideration the comments
            received and including in the order such provisions as are
            necessary to ensure that the order is in conformity with the
            amendments made by this section.
              (4) Effective date.--The final dairy products promotion and
            research order shall be issued and become effective not later
            than 120 days after publication of the proposed order.
      (i) Referendum on Amendments.--Not later than 36 months after the
    issuance of the dairy products promotion and research order reflecting
    the amendments made by this section, the Secretary of Agriculture shall
    conduct a referendum under section 115 of the Dairy Production
    Stabilization Act of 1983 (7 U.S.C. 4506) for the sole purpose of
    determining whether the requirements of such amendments shall be
    continued. The Secretary shall conduct the referendum among persons who
    have been producers or importers (as defined in section 111 of such Act
    (7 U.S.C. 4502)) during a representative period as determined by the
    Secretary. The requirements of such amendments shall be continued only
    if the Secretary determines that such requirements have been approved
    by not less than a majority of the persons voting in the referendum. If
    continuation of the amendments is not approved, the Secretary shall
    issue a new order, within six months after the announcement of the
    results of the referendum, that is identical to the order in effect on
    the date of the enactment of this Act. The new order shall become
    effective upon issuance and shall not be subject to referendum for
    approval.

    SEC. 205. FLUID MILK STANDARDS UNDER MILK MARKETING ORDERS.

      (a) Nature of Standards.--Each marketing order issued with respect to
    milk and its products under section 8c of the Agricultural Adjustment
    Act (7 U.S.C. 608c), reenacted with amendments by the Agricultural
    Marketing Agreement Act of 1937, shall contain terms and conditions to
    provide that all dispositions of fluid milk products containing milk of
    the highest use classification covered by such orders shall comply with
    the following requirements:
              (1) In the case of milk marketed as whole milk, not less than
            12.05 percent total milk solids consisting of not less than 8.8
            percent milk solids not fat and not less than 3.25 percent milk
            fat.
              (2) In the case of milk marketed as 2 percent (or lowfat)
            milk, not less than 12 percent total milk solids consisting of
            not less than 10 percent milk solids not fat and not less than
            2 percent milk fat.
              (3) In the case of milk marketed as 1 percent (or light)
            milk, not less than 12 percent total milk solids consisting of
            not less than 11 percent milk solids not fat and not less than
            1 percent milk fat.
              (4) In the case of milk marketed as skim (or nonfat) milk,
            not less than 9 percent total milk solids consisting of not
            less than 9 percent milk solids not fat and not more than .25
            percent milk fat.
      (b) Violations.--A violation of the requirements specified in
    subsection (a) shall be subject to the penalties provided in section
    8c(14) of the Agricultural Adjustment Act (7 U.S.C. 608c(14)),
    reenacted with amendments by the Agricultural Marketing Agreement Act
    of 1937.
      (c) Effective Date.--The requirements imposed by this section shall
    apply to fluid milk marketed on and after the first day of the first
    month beginning not less than 30 days after the date of the enactment
    of this Act.

    SEC. 206. MANUFACTURING ALLOWANCE.

      (a) Maximum Allowances Established.--No State shall provide for a
    manufacturing allowance for the processing of milk in excess of--
              (1) in the case of milk manufactured into butter, butter oil,
            nonfat dry milk, or whole dry milk--
                      (A) $1.65 per hundredweight of milk, for milk
                    marketed during the 2-year period beginning on the
                    effective date of this section; and
                      (B) such allowance per hundredweight of milk as the
                    Secretary of Agriculture may establish under section
                    221(b)(3), for milk marketed after the end of such
                    period; and
              (2) in the case of milk manufactured into cheese and whey--
                      (A) $1.80 per hundredweight of milk, for milk
                    marketed during the 2-year period beginning on the
                    effective date of this section; and
                      (B) such allowance per hundredweight of milk as the
                    Secretary may establish under section 221(b)(3), for
                    milk marketed after the end of such period.
      (b) Yields.--In converting the weight of milk to dairy products
    during the two-year period beginning on the effective date of this
    section, the Secretary shall use the following yields with respect to a
    hundred pounds of milk:
              (1) Butter: 4.2 pounds.
              (2) Nonfat dry milk: 8.613 pounds.
              (3) 40 pound block cheddar cheese: 10.169 pounds.
              (4) Whey cream butter: .27 pounds.
      (c) Sources of Product Price Values.--In determining the
    manufacturing allowance applicable in a State during the 2-year period
    beginning on the effective date of this section, the Secretary shall
    use the following sources for product price values:
              (1) For butter, Chicago Mercantile Exchange Grade AA butter.
              (2) For nonfat dry milk, California Manufacturing Plants
            Extra Grade and Grade A nonfat dry milk.
              (3) For cheese, National (Green Bay) Cheese Exchange 40 pound
            block cheddar cheese.
              (4) For whey cream butter, Chicago Mercantile Exchange Grade
            B butter.
      (d) Manufacturing Allowance Defined.--In this section, the term
    ``manufacturing allowance'' means--
              (1) the amount by which the product price value of butter and
            nonfat dry milk manufactured from a hundred pounds of milk
            containing 3.5 pounds of milk fat and 8.7 pounds of milk solids
            not fat exceeds the class price for the milk used to produce
            those products; or
              (2) an amount by which the product price value of cheese and
            whey manufactured from a hundred pounds of milk containing 3.6
            pounds of milk fat and 8.7 pounds of milk solids not fat
            exceeds the class price for the milk used to produce those
            products.
      (e) Effect of Violation.--If the Secretary determines that a State
    has in effect a manufacturing allowance that exceeds the manufacturing
    allowance authorized in subsection (a), the Secretary shall suspend,
    until such time as the State complies with such subsection--
              (1) purchases under section 201 of cheddar cheese produced in
            that State; and
              (2) disbursements from the Class IV equalization pool under
            section 208 to milk marketing orders operating in that State
            with respect to milk produced in that State.
      (f) Conforming Suspension and Repeal.--
              (1) Suspension and repeal.--During the 2-year period
            beginning on the effective date of this section, the
            requirements of section 102 of the Food, Agriculture,
            Conservation, and Trade Act of 1990 (7 U.S.C. 1446e-1) shall
            not apply. Effective on the first day after the end of such
            period, such section is repealed.
              (2) Exception.--Notwithstanding paragraph (1), in the event
            that an injunction or other order of a court prohibits or
            impairs the implementation of this section or the activities of
            the Secretary under this section, the Secretary shall use the
            authorities provided by section 102 of the Food, Agriculture,
            Conservation, and Trade Act of 1990 (7 U.S.C. 1446e-1) until
            such time as the injunction or other court order is lifted.
      (g) Effective Date; Implementation.--This section shall take effect
    on the first day of the first month beginning not less than 30 days
    after the date of the enactment of this Act. After such effective date,
    the Secretary may exercise the authority provided to the Secretary
    under this section without regard to the issuance of regulations
    intended to carry out this section.

    SEC. 207. ESTABLISHMENT OF TEMPORARY CLASS I PRICE AND TEMPORARY CLASS
                        I EQUALIZATION POOLS.

      (a) Temporary Pricing for Milk of the Highest Use Classification
    (Class I Milk).--
              (1) Establishment of minimum price.--During the 2-year period
            beginning on the effective date of this section, the minimum
            price for milk of the highest use classification marketed under
            a marketing order issued under section 8c of the Agricultural
            Adjustment Act (7 U.S.C. 608c), reenacted with amendments by
            the Agricultural Marketing Agreement Act of 1937, shall not be
            less than the sum of--
                      (A) $12.87 per hundredweight; and
                      (B) the aggregate adjustment in effect under clauses
                    (1) and (2) of the second sentence of paragraph (5)(A)
                    of such section on December 31, 1995, for milk of the
                    highest use classification in that order.
              (2) Addition to minimum price.--If the basic formula price
            for milk exceeds $12.87 per hundredweight in any month during
            the 2-year period beginning on the effective date of this
            section, the positive difference between the basic formula
            price and $12.87 shall be added to the price for milk of the
            highest use classification marketed under a marketing order
            issued under such section 8c in the second month following the
            month in which the difference occurred.
              (3) Effect on other use classifications.--This subsection
            shall not affect the calculation of the basic formula price
            used to determine the price for milk of use classifications
            other than the highest use classification.
      (b) Class I Equalization Pools.--
              (1) Collections.--During the 2-year period beginning on the
            effective date of this section, the Secretary of Agriculture
            shall collect, on a monthly basis, from each marketing order
            issued with respect to milk and its products under section 8c
            of the Agricultural Adjustment Act (7 U.S.C. 608c), reenacted
            with amendments by the Agricultural Marketing Agreement Act of
            1937, and from the comparable milk marketing order issued by
            the State of California, an amount equal to the product of--
                      (A) $0.80 per hundredweight; and
                      (B) the total hundredweights of all milk of the
                    highest use classification marketed under the order for
                    the month.
              (2) Disbursements.--The Secretary shall pay, on a monthly
            basis, to each marketing order referred to in paragraph (1) an
            amount equal to the product of--
                      (A) the total collection under paragraph (1) for the
                    month; and
                      (B) the ratio of the total hundredweights of all milk
                    marketed for the month under that order to all milk
                    marketed for the month under all such orders.
              (3) Effect on blend prices.--Producer blend prices under a
            milk marketing order shall be adjusted to account for
            collections made under paragraph (1) and disbursements made
            under paragraph (2).
      (c) Enforcement.--
              (1) In general.--Amounts for which a milk marketing order are
            responsible under subsection (b) shall be determined on a
            monthly basis and shall be collected and remitted to the
            Secretary in the manner prescribed by the Secretary.
              (2) Penalties.--If any person fails to remit the amount
            required in subsection (b) or fails to comply with such
            requirements for recordkeeping or otherwise as are required by
            the Secretary to carry out this section, the person shall be
            liable to the Secretary for a civil penalty up to an amount
            determined by multiplying--
                      (A) the quantity of milk involved in the violation;
                    by
                      (B) the support rate for milk in effect at the time
                    of the violation under section 201.
              (3) Enforcement.--The Secretary may enforce this section in
            the courts of the United States.
      (d) Conforming Repeal.--Section 8c(5)(A) of the Agricultural
    Adjustment Act (7 U.S.C. 608c(5)(A)), reenacted with amendments by the
    Agricultural Marketing Agreement Act of 1937, is amended by striking
    out the sentence beginning ``Throughout the 2-year period'' and all
    that follows through the end of the subparagraph.
      (e) Effective Date.--Except as provided in subsection (f), this
    section shall take effect on the first day of the first month beginning
    not less than 30 days after the date of the enactment of this Act.
      (f) Implementation.--Not later than the effective date of this
    section, the Secretary shall amend Federal milk marketing orders issued
    under section 8c of the Agricultural Adjustment Act (7 U.S.C. 608c),
    reenacted with amendments by the Agricultural Marketing Agreement Act
    of 1937, to effectuate the requirements of this section. The amendments
    shall not be--
              (1) subject to a referendum under subsection (17) or (19) of
            such section among milk producers to determine whether issuance
            of such order is approved or favored by milk producers;
              (2) preconditioned on the existence of a marketing agreement
            among handlers under subsection (8) of such section and section
            8b of such Act (7 U.S.C. 608b);
              (3) subject to rulemaking under title 5, United States Code;
            or
              (4) subject to review or approval by other executive
            agencies.

    SEC. 208. ESTABLISHMENT OF TEMPORARY CLASS IV PRICE AND TEMPORARY CLASS
                        IV EQUALIZATION POOL.

      (a) Temporary Classification of Class IV Milk.--
              (1) Classification.--For purposes of classifying milk in
            accordance with the form in which or the purpose for which it
            is used, the Secretary of Agriculture shall designate all milk
            marketed in the 48 contiguous States of the United States and
            used to produce butter, butter oil, nonfat dry milk, or dry
            whole milk as Class IV milk. The Secretary may include other
            products of milk, except cheese, within the Class IV
            classification if the Secretary determines that inclusion of
            the product would be fair and equitable.
              (2) Use of classification.--Each marketing order issued with
            respect to milk and its products under section 8c of the
            Agricultural Adjustment Act (7 U.S.C. 608c), reenacted with
            amendments by the Agricultural Marketing Agreement Act of 1937,
            and each comparable State milk marketing order, shall use the
            classification required by paragraph (1) in lieu of any other
            classification, such as Class III-A milk, to properly classify
            milk used to produce butter, butter oil, nonfat dry milk, or
            dry whole milk.
      (b) Establishment of Class IV Pool.--The Secretary shall establish a
    Class IV pool for the purpose of making collections and disbursements
    related to milk classified as Class IV milk under subsection (a). The
    Class IV pool shall apply to milk covered by a milk marketing order
    referred to in subsection (a) and unregulated milk.
      (c) Establishment of Monthly Class IV Price.--For the purpose of
    determining whether the Secretary will make collections and
    disbursements under the Class IV equalization pool, the Secretary shall
    establish, on a monthly basis, a price for dairy products manufactured
    from Class IV milk on a 3.5 percent butterfat basis. In determining
    that price, the Secretary shall calculate the amount equal to--
              (1) the sum of--
                      (A) the product of the Western States Extra Grade and
                    Grade A price per pound for nonfat dry milk and 8.613;
                    and
                      (B) the product of the Chicago Mercantile Exchange
                    Grade AA price per pound for butter and 4.2; less
              (2) a manufacturing allowance equal to $1.65 per
            hundredweight of milk.
      (d) Operation of Class IV Equalization Pool.--
              (1) Application of subsection.--This subsection shall apply
            in any month in which the support price for milk under section
            201, adjusted to 3.5 percent butterfat, exceeds the Class IV
            price established under subsection (c).
              (2) Collection.--In any month in which the Class IV
            equalization pool is in operation under paragraph (1), each
            milk marketing order referred to in subsection (a) and each
            handler of unregulated milk shall pay into the Class IV
            equalization pool an amount equal to the product of--
                      (A) the total hundredweights of Class IV milk used to
                    manufacture dairy products during that month under all
                    such orders and by all such handlers;
                      (B) 50 percent of the amount by which the support
                    price for milk under section 201, adjusted to 3.5
                    percent butterfat, exceeded the Class IV price
                    determined under subsection (c) for that month; and
                      (C) the ratio of the total hundredweights of all milk
                    marketed during that month under that order or by that
                    handler to the total hundredweights of all milk
                    marketed for that month under all such orders and by
                    all such handlers.
              (3) Disbursements.--In any month in which the Class IV
            equalization pool is in operation under paragraph (1), each
            milk marketing order referred to in subsection (a) in which
            products were manufactured from Class IV milk during that month
            and each handler of unregulated milk that manufactured products
            from Class IV milk during that month shall receive from the
            Class IV equalization pool an amount equal to the product of--
                      (A) the total collection under paragraph (2) for the
                    month; and
                      (B) the ratio of the total hundredweights of Class IV
                    milk manufactured into dairy products during that month
                    under that order or by that handler to the total
                    hundredweights of Class IV milk manufactured into dairy
                    products during that month under all such orders and by
                    all such handlers.
              (4) Effect on blend prices.--Producer blend prices under a
            milk marketing order referred to in subsection (a) shall be
            adjusted to account for collections under paragraph (2) and
            disbursements under paragraph (3).
      (e) Enforcement.--
              (1) In general.--Amounts for which a milk marketing order or
            handler are responsible under subsection (b) shall be
            determined on a monthly basis and shall be collected and
            remitted to the Secretary in the manner prescribed by the
            Secretary.
              (2) Penalties.--If any person fails to remit the amount
            required in subsection (c) or fails to comply with such
            requirements for recordkeeping or otherwise as are required by
            the Secretary to carry out this section, the person shall be
            liable to the Secretary for a civil penalty up to an amount
            determined by multiplying--
                      (A) the quantity of milk involved in the violation;
                    by
                      (B) the support rate for milk in effect at the time
                    of the violation under section 201.
              (3) Enforcement.--The Secretary may enforce this section in
            the courts of the United States.
      (f) Effective Date.--Except as provided in subsection (g), this
    section shall--
              (1) take effect on the first day of the first month beginning
            not less than 30 days after the date of the enactment of this
            Act; and
              (2) apply during the 2-year period beginning on such
            effective date.
      (g) Implementation.--Not later than the start of the effective date
    of this section, the Secretary shall amend Federal milk marketing
    orders issued under section 8c of the Agricultural Adjustment Act (7
    U.S.C. 608c), reenacted with amendments by the Agricultural Marketing
    Agreement Act of 1937, to effectuate the requirements of this section.
    The amendments shall not be--
              (1) subject a referendum under subsection (17) or (19) of
            such section among milk producers to determine whether issuance
            of such order is approved or favored by milk producers;
              (2) preconditioned on the existence of a marketing agreement
            among handlers under subsection (8) of such section and section
            8b of such Act (7 U.S.C. 608b);
              (3) subject to rulemaking under title 5, United States Code;
            or
              (4) subject to review or approval by other executive
            agencies.

    SEC. 209. AUTHORITY FOR ESTABLISHMENT OF STANDBY POOLS.

      (a) Authority to Establish.--As soon as possible after the effective
    date of this section, the Secretary of Agriculture shall publish in the
    Federal Register an invitation for interested persons to submit
    proposals for the establishment within Federal milk marketing orders
    issued under section 8c of the Agricultural Adjustment Act (7 U.S.C.
    608c), reenacted with amendments by the Agricultural Marketing
    Agreement Act of 1937, of standby pools to facilitate the movement of
    milk over long distances during periods of shortage through the sharing
    of proceeds from sales of milk of the highest use classification due to
    producers under the order with producers shipping to plants regulated
    by another order to provide a reserve supply of milk in the other
    market.
      (b) Approval or Termination of Participation in Standby Pool.--Order
    provisions under this section shall not become effective in any
    marketing order unless such provisions are approved by producers in the
    manner provided for the approval of marketing orders under section 8c
    of the Agricultural Adjustment Act (7 U.S.C. 608c), reenacted with
    amendments by the Agricultural Marketing Agreement Act of 1937, but
    separately from other order provisions. Standby pool provisions
    approved under this section in an order may be disapproved separately
    by producers or terminated separately by the Secretary under section
    8c(16)(B) of such Act. Such disapproval or termination shall not be
    considered to be a disapproval or termination of the other terms of
    that order.
      (c) Effective Date.--This section shall take effect on the first day
    of the first month beginning not less than 30 days after the date of
    the enactment of this Act.

              Subtitle B--Reform of Federal Milk Marketing Orders

    SEC. 221. ISSUANCE OR AMENDMENT OF FEDERAL MILK MARKETING ORDERS TO
                        IMPLEMENT CERTAIN REFORMS.

      (a) Issuance of Amended Orders.--Subject to the time limits specified
    in section 222, the Secretary of Agriculture shall issue new or amended
    marketing orders with respect to milk and its products under section 8c
    of the Agricultural Adjustment Act (7 U.S.C. 608c), reenacted with
    amendments by the Agricultural Marketing Agreement Act of 1937, to
    effectuate the requirements of subsection (b). The orders shall take
    effect on the date the orders are issued and shall supersede all other
    marketing orders and any other statutes, rules, and regulations that
    are applicable to the pricing and marketing of milk and its products in
    effect immediately before that date, whether under the authority of
    section 8c of such Act or a State or local law.
      (b) Reform Requirements.--The Secretary shall reform the Federal milk
    marketing order system under subsection (a) to accomplish the following
    purposes:
              (1) Consolidation of Federal milk marketing orders into not
            less than 8 nor more than 13 orders, which shall also include
            those areas of the 48 contiguous States not covered by a
            Federal milk marketing order on the date of the enactment of
            this Act. One of the new Federal milk marketing orders shall
            only cover the State of California. A new or amended order
            shall have the right to blend order receipts to address unique
            issues to that order such as a preexisting State quota system.
              (2) Implementation of uniform multiple component pricing for
            milk used in manufactured dairy products.
              (3) Establishment of class prices for milk used to produce
            cheese, nonfat dry milk, and butter based on national product
            prices, less a manufacturing allowance. The resulting prices
            shall not vary regionally, except to reflect variances in
            transportation and reasonable operating costs, if any, of
            efficient processing plants in different geographical areas.
      (c) Status of Producer Handlers.--In amending Federal milk marketing
    orders under this section, the Secretary shall ensure that the legal
    status of producer handlers of milk under the Agricultural Adjustment
    Act (7 U.S.C. 601 et seq.), reenacted with amendments by the
    Agricultural Marketing Agreement Act of 1937, shall be the same after
    the amendments made by this section take effect as it was before the
    effective date of the amendments.

    SEC. 222. REFORM PROCESS.

      (a) Process.--In preparation for the issuance of the new or amended
    Federal milk marketing orders required under section 221, the Secretary
    of Agriculture shall comply with the following expedited procedural
    requirements:
              (1) Not later than 165 days after the date of the enactment
            of this Act, the Secretary shall issue proposed amendments or
            new milk marketing orders to effectuate the reform requirements
            specified in such section.
              (2) The Secretary shall provide for a 75-day comment period
            on the proposed amendments or orders issued under paragraph
            (1).
              (3) Not later than 120 days after the end of the comment
            period provided under paragraph (2), the Secretary shall
            publish in the Federal Register a final administrative decision
            regarding the issuance or amendment of Federal milk marketing
            orders to effectuate the reform requirements specified in such
            section.
      (b) Referendum and Marketing Agreement.--After the issuance of the
    new or amended Federal milk marketing orders under section 221, the
    Secretary may conduct a referendum in the manner provided in section
    8c(16)(B) of the Agricultural Adjustment Act (7 U.S.C. 608c(16)(B)),
    reenacted with amendments by the Agricultural Marketing Agreement Act
    of 1937, with respect to each order to determine whether milk producers
    subject to the order favor the termination of the order.
      (c) Application of Administrative Procedures Act.--The issuance of
    the new or amended Federal milk marketing orders required under section
    221 shall not be subject to rulemaking under title 5, United States
    Code.
      (d) Review and Approval.--The action of the Secretary under section
    221 shall not be subject to review or approval by any other executive
    agency.

    SEC. 223. EFFECT OF FAILURE TO COMPLY WITH REFORM PROCESS REQUIREMENTS.

      (a) Failure to Timely Issue or Amend Orders.--If, before the end of
    the 1-year period beginning on the date of the enactment of this Act,
    the Secretary of Agriculture does not issue new or amended Federal milk
    marketing orders under section 8c of the Agricultural Adjustment Act (7
    U.S.C. 608c), reenacted with amendments by the Agricultural Marketing
    Agreement Act of 1937, to effectuate the requirements of section
    221(b), then the Secretary may not assess or collect assessments from
    milk producers or handlers under such section 8c for marketing order
    administration and services provided under such section after the end
    of that period. The Secretary may not reduce the level of services
    provided under such section on account of the prohibition against
    assessments, but shall rather cover the cost of marketing order
    administration and services through funds available for the
    Agricultural Marketing Service of the Department of Agriculture.
      (b) Failure to Timely Implement Orders.--Unless the Secretary
    certifies to Congress before the end of the 2-year period beginning on
    the date of the enactment of this Act that all of the Federal marketing
    order reforms required by section 221(b) have been fully implemented,
    then, effective at the end of that period--
              (1) the Secretary shall immediately cease all price support
            activities under section 201;
              (2) the Secretary shall immediately terminate all Federal
            milk marketing orders under section 8c of the Agricultural
            Adjustment Act (7 U.S.C. 608c), reenacted with amendments by
            the Agricultural Marketing Agreement Act of 1937, and may not
            issue any further order under such Act with respect to milk;
              (3) the Commodity Credit Corporation shall immediately cease
            to operate the dairy export incentive program under section 153
            of the Food Security Act of 1985 (15 U.S.C. 713a-14);
              (4) the Secretary and the National Processor Advertising and
            Promotion Board shall immediately cease all activities under
            the Fluid Milk Promotion Act of 1990 (7 U.S.C. 6401 et seq.);
            and
              (5) the Secretary and the National Dairy Promotion and
            Research Board shall immediately cease all activities under the
            Dairy Production Stabilization Act of 1983 (7 U.S.C. 4501 et
            seq.).
      (c) Effect of Court Order.--The actions authorized by this section
    are intended to ensure the timely publication and implementation of new
    and amended Federal milk marketing orders under section 8c of the
    Agricultural Adjustment Act (7 U.S.C. 608c), reenacted with amendments
    by the Agricultural Marketing Agreement Act of 1937. In the event that
    the Secretary is enjoined or otherwise restrained by a court order from
    publishing or implementing the reform requirements specified by section
    221, the length of time for which that injunction or other restraining
    order is effective shall be added to the time limitations specified in
    subsections (a) and (b) thereby extending those time limitations by a
    period of time equal to the period of time for which the injunction or
    other restraining order is effective.

                            TITLE III--CONSERVATION

    SEC. 301. CONSERVATION.

      (a) Funding.--Subtitle E of title XII of the Food Security Act of
    1985 (16 U.S.C. 3841 et seq.) is amended to read as follows:

                             ``Subtitle E--Funding

    ``SEC. 1241. FUNDING.

      ``(a) Mandatory Expenses.--For each of fiscal years 1996 through
    2002, the Secretary shall use the funds of the Commodity Credit
    Corporation to carry out the programs authorized by--
              ``(1) subchapter B of chapter 1 of subtitle D (including
            contracts extended by the Secretary pursuant to section 1437 of
            the Food, Agriculture, Conservation, and Trade Act of 1990
            (Public Law 101-624; 16 U.S.C. 3831 note));
              ``(2) subchapter C of chapter 1 of subtitle D; and
              ``(3) chapter 4 of subtitle D.
      ``(b) Livestock Environmental Assistance Program.--For each of fiscal
    years 1996 through 2002, $100,000,000 of the funds of the Commodity
    Credit Corporation shall be available for providing technical
    assistance, cost-sharing payments, and incentive payments for practices
    relating to livestock production under the livestock environmental
    assistance program under chapter 4 of subtitle D.''.
      (b) Livestock Environmental Assistance Program.--Subtitle D of title
    XII of the Food Security Act of 1985 (16 U.S.C. 3830 et seq.) is
    amended by adding at the end the following:

            ``CHAPTER 4--LIVESTOCK ENVIRONMENTAL ASSISTANCE PROGRAM

    ``SEC. 1240. DEFINITIONS.

      ``In this chapter:
              ``(1) Land management practice.--The term `land management
            practice' means a site-specific nutrient or manure management,
            irrigation management, tillage or residue management, grazing
            management, or other land management practice that the
            Secretary determines is needed to protect, in the most cost
            effective manner, water, soil, or related resources from
            degradation due to livestock production.
              ``(2) Large confined livestock operation.--The term `large
            confined livestock operation' means an operation that--
                      ``(A) is a confined animal feeding operation; and
                      ``(B) has more than--
                              ``(i) 55 mature dairy cattle;
                              ``(ii) 10,000 beef cattle;
                              ``(iii) 30,000 laying hens or broilers (if
                            the facility has continuous overflow watering);
                              ``(iv) 100,000 laying hens or broilers (if
                            the facility has a liquid manure system);
                              ``(v) 55,000 turkeys;
                              ``(vi) 15,000 swine; or
                              ``(vii) 10,000 sheep or lambs.
              ``(3) Livestock.--The term `livestock' means dairy cows, beef
            cattle, laying hens, broilers, turkeys, swine, sheep, lambs,
            and such other animals as determined by the Secretary.
              ``(4) Operator.--The term `operator' means a person who is
            engaged in livestock production (as defined by the Secretary).
              ``(5) Structural practice.--The term `structural practice'
            means the establishment of an animal waste management facility,
            terrace, grassed waterway, contour grass strip, filterstrip, or
            other structural practice that the Secretary determines is
            needed to protect, in the most cost effective manner, water,
            soil, or related resources from degradation due to livestock
            production.

    ``SEC. 1240A. ESTABLISHMENT AND ADMINISTRATION OF LIVESTOCK
                        ENVIRONMENTAL ASSISTANCE PROGRAM.

      ``(a) Establishment.--
              ``(1) In general.--During the 1996 through 2002 fiscal years,
            the Secretary shall provide technical assistance, cost-sharing
            payments, and incentive payments to operators who enter into
            contracts with the Secretary, through a livestock environmental
            assistance program.
              ``(2) Eligible practices.--
                      ``(A) Structural practices.--An operator who
                    implements a structural practice shall be eligible for
                    technical assistance or cost-sharing payments, or both.
                      ``(B) Land management practices.--An operator who
                    performs a land management practice shall be eligible
                    for technical assistance or incentive payments, or
                    both.
              ``(3) Eligible land.--Assistance under this chapter may be
            provided with respect to land that is used for livestock
            production and on which a serious threat to water, soil, or
            related resources exists, as determined by the Secretary, by
            reason of the soil types, terrain, climatic, soil, topographic,
            flood, or saline characteristics, or other factors or natural
            hazards.
              ``(4) Selection criteria.--In providing technical assistance,
            cost-sharing payments, and incentive payments to operators in a
            region, watershed, or conservation priority area in which an
            agricultural operation is located, the Secretary shall
            consider--
                      ``(A) the significance of the water, soil, and
                    related natural resource problems; and
                      ``(B) the maximization of environmental benefits per
                    dollar expended.
      ``(b) Application and Term.--
              ``(1) In general.--A contract between an operator and the
            Secretary under this chapter may--
                      ``(A) apply to 1 or more structural practices or 1 or
                    more land management practices, or both; and
                      ``(B) have a term of not less than 5, nor more than
                    10 years, as determined appropriate by the Secretary,
                    depending on the practice or practices that are the
                    basis of the contract.
              ``(2) Duties of operators and secretary.--To receive cost-
            sharing or incentive payments, or technical assistance,
            participating operators shall comply with all terms and
            conditions of the contract and a plan, as established by the
            Secretary.
      ``(c) Structural Practices.--
              ``(1) Competitive offer.--The Secretary shall administer a
            competitive offer system for operators proposing to receive
            cost-sharing payments in exchange for the implementation of 1
            or more structural practices by the operator. The competitive
            offer system shall consist of--
                      ``(A) the submission of a competitive offer by the
                    operator in such manner as the Secretary may prescribe;
                    and
                      ``(B) evaluation of the offer in light of the
                    selection criteria established under subsection (a)(4)
                    and the projected cost of the proposal, as determined
                    by the Secretary.
              ``(2) Concurrence of owner.--If the operator making an offer
            to implement a structural practice is a tenant of the land
            involved in agricultural production, for the offer to be
            acceptable, the operator shall obtain the concurrence of the
            owner of the land with respect to the offer.
      ``(d) Land Management Practices.--The Secretary shall establish an
    application and evaluation process for awarding technical assistance or
    incentive payments, or both, to an operator in exchange for the
    performance of 1 or more land management practices by the operator.
      ``(e) Cost-Sharing, Incentive Payments, and Technical Assistance.--
              ``(1) Cost-sharing payments.--
                      ``(A) In general.--The Federal share of cost-sharing
                    payments to an operator proposing to implement 1 or
                    more structural practices shall not be greater than 75
                    percent of the projected cost of each practice, as
                    determined by the Secretary, taking into consideration
                    any payment received by the operator from a State or
                    local government.
                      ``(B) Limitation.--An operator of a large confined
                    livestock operation shall not be eligible for cost-
                    sharing payments to construct an animal waste
                    management facility.
                      ``(C) Other payments.--An operator shall not be
                    eligible for cost-sharing payments for structural
                    practices on eligible land under this chapter if the
                    operator receives cost-sharing payments or other
                    benefits for the same land under chapter 1, 2, or 3.
              ``(2) Incentive payments.--The Secretary shall make incentive
            payments in an amount and at a rate determined by the Secretary
            to be necessary to encourage an operator to perform 1 or more
            land management practices.
              ``(3) Technical assistance.--
                      ``(A) Funding.--The Secretary shall allocate funding
                    under this chapter for the provision of technical
                    assistance according to the purpose and projected cost
                    for which the technical assistance is provided for a
                    fiscal year. The allocated amount may vary according to
                    the type of expertise required, quantity of time
                    involved, and other factors as determined appropriate
                    by the Secretary. Funding shall not exceed the
                    projected cost to the Secretary of the technical
                    assistance provided for a fiscal year.
                      ``(B) Other authorities.--The receipt of technical
                    assistance under this chapter shall not affect the
                    eligibility of the operator to receive technical
                    assistance under other authorities of law available to
                    the Secretary.
      ``(f) Limitation on Payments.--
              ``(1) In general.--The total amount of cost-sharing and
            incentive payments paid to a person under this chapter may not
            exceed--
                      ``(A) $10,000 for any fiscal year; or
                      ``(B) $50,000 for any multiyear contract.
              ``(2) Regulations.--The Secretary shall issue regulations
            that are consistent with section 1001 for the purpose of--
                      ``(A) defining the term `person' as used in paragraph
                    (1); and
                      ``(B) prescribing such rules as the Secretary
                    determines necessary to ensure a fair and reasonable
                    application of the limitations established under this
                    subsection.
      ``(g) Regulations.--Not later than 180 days after the effective date
    of this subsection, the Secretary shall issue regulations to implement
    the livestock environmental assistance program established under this
    chapter.''.
      (c) Conforming Program Changes.--
              (1) Wetlands reserve program.--
                      (A) In general.--Section 1237 of the Food Security
                    Act of 1985 (16 U.S.C. 3837) is amended--
                              (i) in subsection (b)(2)--
                                      (I) by striking ``not less'' and
                                    inserting ``not more''; and
                                      (II) by striking ``2000'' and
                                    inserting ``2002''; and
                              (ii) in subsection (c), by striking ``2000''
                            and inserting ``2002''.
                      (B) Length of easement.--Section 1237A(e) of the Food
                    Security Act of 1985 (16 U.S.C. 3837a(e)) is amended by
                    striking paragraph (2) and inserting the following:
              ``(2) shall be for 15 years, but in no case shall be a
            permanent easement.''.
              (2) Conservation reserve program.--Section 1231(d) of the
            Food Security Act of 1985 (16 U.S.C. 3831(d)) is amended by
            striking ``total of'' and all that follows through the period
            at the end of the subsection and inserting ``total of
            36,400,000 acres.''. Section 725 of the Agriculture, Rural
            Development, Food and Drug Administration, and Related Agencies
            Appropriations Act, 1996 (Public Law 104-37; 109 Stat. 332), is
            amended by striking the proviso relating to enrollment of new
            acres in 1997.

              TITLE IV--AGRICULTURAL PROMOTION AND EXPORT PROGRAMS

    SEC. 401. MARKET PROMOTION PROGRAM.

      Effective as of October 1, 1995, section 211(c)(1) of the
    Agricultural Trade Act of 1978 (7 U.S.C. 5641(c)(1)) is amended--
              (1) by striking ``and'' after ``1991 through 1993,''; and
              (2) by striking ``through 1997,'' and inserting ``through
            1995, and not more than $100,000,000 for each of fiscal years
            1996 through 2002,''.

    SEC. 402. EXPORT ENHANCEMENT PROGRAM.

      Effective as of October 1, 1995, section 301(e)(1) of the
    Agricultural Trade Act of 1978 (7 U.S.C. 5651(e)(1)) is amended to read
    as follows:
              ``(1) In general.--The Commodity Credit Corporation shall
            make available to carry out the program established under this
            section not more than--
                      ``(A) $350,000,000 for fiscal year 1996;
                      ``(B) $350,000,000 for fiscal year 1997;
                      ``(C) $500,000,000 for fiscal year 1998;
                      ``(D) $550,000,000 for fiscal year 1999;
                      ``(E) $579,000,000 for fiscal year 2000;
                      ``(F) $478,000,000 for fiscal year 2001; and
                      ``(G) $478,000,000 for fiscal year 2002.''.

                             TITLE V--MISCELLANEOUS

    SEC. 501. CROP INSURANCE.

      (a) Catastrophic Risk Protection.--Section 508(b) of the Federal Crop
    Insurance Act (7 U.S.C. 1508(b)) is amended--
              (1) in paragraph (4), by adding at the end the following:
                      ``(C) Delivery of coverage.--
                              ``(i) In general.--In full consultation with
                            approved insurance providers, the Secretary may
                            continue to offer catastrophic risk protection
                            in a State (or a portion of a State) through
                            local offices of the Department if the
                            Secretary determines that there is an
                            insufficient number of approved insurance
                            providers operating in the State or portion to
                            adequately provide catastrophic risk protection
                            coverage to producers.
                              ``(ii) Coverage by approved insurance
                            providers.--To the extent that catastrophic
                            risk protection coverage by approved insurance
                            providers is sufficiently available in a State
                            as determined by the Secretary, only approved
                            insurance providers may provide the coverage in
                            the State.
                              ``(iii) Current policies.--Subject to clause
                            (ii), all catastrophic risk protection policies
                            written by local offices of the Department
                            shall be transferred (including all fees
                            collected for the crop year in which the
                            approved insurance provider will assume the
                            policies) to the approved insurance provider
                            for performance of all sales, service, and loss
                            adjustment functions.''; and
              (2) in paragraph (7), by striking subparagraph (A) and
            inserting the following:
                      ``(A) In general.--Effective for the spring-planted
                    1996 and subsequent crops, to be eligible for any
                    payment or loan under title I of the Agricultural
                    Market Transition Act or the Agricultural Adjustment
                    Act of 1938 (7 U.S.C. 1281 et seq.), for the
                    conservation reserve program, or for any benefit
                    described in section 371 of the Consolidated Farm and
                    Rural Development Act (7 U.S.C. 2008f), a person
                    shall--
                              ``(i) obtain at least the catastrophic level
                            of insurance for each crop of economic
                            significance in which the person has an
                            interest; or
                              ``(ii) provide a written waiver to the
                            Secretary that waives any eligibility for
                            emergency crop loss assistance in connection
                            with the crop.''.
      (b) Coverage of Seed Crops.--Section 519(a)(2)(B) of the Act (7
    U.S.C. 1519(a)(2)(B)) is amended by inserting ``seed crops,'' after
    ``turfgrass sod,''.

    SEC. 502. COLLECTION AND USE OF AGRICULTURAL QUARANTINE AND INSPECTION
                        FEES.

      Subsection (a) of section 2509 of the Food, Agriculture,
    Conservation, and Trade Act of 1990 (21 U.S.C. 136a) is amended to read
    as follows:
      ``(a) Quarantine and Inspection Fees.--
              ``(1) Fees authorized.--The Secretary of Agriculture may
            prescribe and collect fees sufficient--
                      ``(A) to cover the cost of providing agricultural
                    quarantine and inspection services in connection with
                    the arrival at a port in the customs territory of the
                    United States, or the preclearance or preinspection at
                    a site outside the customs territory of the United
                    States, of an international passenger, commercial
                    vessel, commercial aircraft, commercial truck, or
                    railroad car;
                      ``(B) to cover the cost of administering this
                    subsection; and
                      ``(C) through fiscal year 2002, to maintain a
                    reasonable balance in the Agricultural Quarantine
                    Inspection User Fee Account established under paragraph
                    (5).
              ``(2) Limitation.--In setting the fees under paragraph (1),
            the Secretary shall ensure that the amount of the fees are
            commensurate with the costs of agricultural quarantine and
            inspection services with respect to the class of persons or
            entities paying the fees. The costs of the services with
            respect to passengers as a class includes the costs of related
            inspections of the aircraft or other vehicle.
              ``(3) Status of fees.--Fees collected under this subsection
            by any person on behalf of the Secretary are held in trust for
            the United States and shall be remitted to the Secretary in
            such manner and at such times as the Secretary may prescribe.
              ``(4) Late payment penalties.--If a person subject to a fee
            under this subsection fails to pay the fee when due, the
            Secretary shall assess a late payment penalty, and the overdue
            fees shall accrue interest, as required by section 3717 of
            title 31, United States Code.
              ``(5) Agricultural quarantine inspection user fee account.--
                      ``(A) Establishment.--There is established in the
                    Treasury of the United States a no-year fund, to be
                    known as the `Agricultural Quarantine Inspection User
                    Fee Account', which shall contain all of the fees
                    collected under this subsection and late payment
                    penalties and interest charges collected under
                    paragraph (4) through fiscal year 2002.
                      ``(B) Use of account.--For each of the fiscal years
                    1996 through 2002, funds in the Agricultural Quarantine
                    Inspection User Fee Account shall be available, in such
                    amounts as are provided in advance in appropriations
                    Acts, to cover the costs associated with the provision
                    of agricultural quarantine and inspection services and
                    the administration of this subsection. Amounts made
                    available under this subparagraph shall be available
                    until expended.
                      ``(C) Excess fees.--Fees and other amounts collected
                    under this subsection in any of the fiscal years 1996
                    through 2002 in excess of $100,000,000 shall be
                    available for the purposes specified in subparagraph
                    (B) until expended, without further appropriation.
              ``(6) Use of amounts collected after fiscal year 2002.--After
            September 30, 2002, the unobligated balance in the Agricultural
            Quarantine Inspection User Fee Account and fees and other
            amounts collected under this subsection shall be credited to
            the Department of Agriculture accounts that incur the costs
            associated with the provision of agricultural quarantine and
            inspection services and the administration of this subsection.
            The fees and other amounts shall remain available to the
            Secretary until expended without fiscal year limitation.
              ``(7) Staff years.--The number of full-time equivalent
            positions in the Department of Agriculture attributable to the
            provision of agricultural quarantine and inspection services
            and the administration of this subsection shall not be counted
            toward the limitation on the total number of full-time
            equivalent positions in all agencies specified in section 5(b)
            of the Federal Workforce Restructuring Act of 1994 (Public Law
            103-226; 5 U.S.C. 3101 note) or other limitation on the total
            number of full-time equivalent positions.''.

    SEC. 503. COMMODITY CREDIT CORPORATION INTEREST RATE.

      Notwithstanding any other provision of law, the monthly Commodity
    Credit Corporation interest rate applicable to loans provided for
    agricultural commodities by the Corporation shall be 100 basis points
    greater than the rate determined under the applicable interest rate
    formula in effect on October 1, 1995.

    SEC. 504. ESTABLISHMENT OF OFFICE OF RISK MANAGEMENT.

      (a) Establishment.--The Department of Agriculture Reorganization Act
    of 1994 is amended by inserting after section 226 (7 U.S.C. 6932) the
    following new section:

    ``SEC. 226A. OFFICE OF RISK MANAGEMENT.

      ``(a) Establishment.--Subject to subsection (e), the Secretary shall
    establish and maintain in the Department an independent Office of Risk
    Management.
      ``(b) Functions of the Office of Risk Management.--The Office of Risk
    Management shall have jurisdiction over the following functions:
              ``(1) Supervision of the Federal Crop Insurance Corporation.
              ``(2) Administration and oversight of all aspects, including
            delivery through local offices of the Department, of all
            programs authorized under the Federal Crop Insurance Act (7
            U.S.C. 1501 et seq.).
              ``(3) Any pilot or other programs involving revenue
            insurance, risk management savings accounts, or the use of the
            futures market to manage risk and support farm income that may
            be established under the Federal Crop Insurance Act or other
            law.
              ``(4) Such other functions as the Secretary considers
            appropriate.
      ``(c) Administrator.--
              ``(1) The Office of Risk Management shall be headed by an
            Administrator who shall be appointed by the Secretary.
              ``(2) The Administrator of the Office of Risk Management
            shall also serve as Manager of the Federal Crop Insurance
            Corporation.
      ``(d) Resources.--
              ``(1) Functional coordination.--Certain functions of the
            Office of Risk Management, such as human resources, public
            affairs, and legislative affairs, may be provided by a
            consolidation of such functions under the Under Secretary of
            Agriculture for Farm and Foreign Agricultural Services.
              ``(2) Minimum provisions.--Notwithstanding paragraph (1) or
            any other provision of law or order of the Secretary, the
            Secretary shall provide the Office of Risk Management with
            human and capital resources sufficient for the Office to carry
            out its functions in a timely and efficient manner.''.
      (b) Fiscal Year 1996 Funding.--Not less than $88,500,000 of the
    appropriation provided for the salaries and expenses of the
    Consolidated Farm Services Agency in the Agricultural, Rural
    Development, Food and Drug Administration, and Related Agencies
    Appropriations Act, 1996 shall be available for the salaries and
    expenses of the Office of Risk Management established under subsection
    (a).
      (c) Conforming Amendment.--Section 226(b) of the Act (7 U.S.C.
    6932(b)) is amended by striking paragraph (2).

    SEC. 505. BUSINESS INTERRUPTION INSURANCE PROGRAM.

      (a) Establishment of Program.--Not later than December 31, 1996, the
    Secretary of Agriculture shall implement a program (to be known as the
    ``Business Interruption Insurance Program''), under which the producer
    of a contract commodity could elect to obtain revenue insurance
    coverage to ensure that the producer receives an indemnity payment if
    the producer suffers a loss of revenue. The nature and extent of the
    program and the manner of determining the amount of an indemnity
    payment shall be established by the Secretary.
      (b) Report on Progress and Proposed Expansion.--Not later than
    January 1, 1998, the Secretary shall submit to the Commission on 21st
    Century Production Agriculture the data and results of the program
    through October 1, 1997. In addition, the Secretary shall submit
    information and recommendations to the Commission with respect to the
    program that will serve as the basis for the Secretary to offer revenue
    insurance to agricultural producers, at one or more levels of coverage,
    that--
              (1) is in addition to, or in lieu of, catastrophic and higher
            levels of crop insurance;
              (2) is offered through reinsurance arrangements with private
            insurance companies;
              (3) is actuarially sound; and
              (4) requires the payment of premiums and administrative fees
            by participating producers.
      (c) Contract Commodity Defined.--In this section, the term ``contract
    commodity'' means a crop of wheat, corn, grain sorghum, oats, barley,
    upland cotton, or rice.

    SEC. 506. CONTINUATION OF OPTIONS PILOT PROGRAM.

      During the 1996 through 2002 crop years, the Secretary of Agriculture
    may continue to conduct the options pilot program authorized by the
    Options Pilot Program Act of 1990 (subtitle E of title XI of Public Law
    101-624; 104 Stat. 3518; 7 U.S.C. 1421 note). To the extent that the
    Secretary decides to continue the options pilot program, the Secretary
    shall modify the terms and conditions of the pilot program to reflect
    the changes to law made by this Act.

          TITLE VI--COMMISSION ON 21ST CENTURY PRODUCTION AGRICULTURE

    SEC. 601. ESTABLISHMENT.

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

    SEC. 602. COMPOSITION.

      (a) Membership and Appointment.--The Commission shall be composed of
    11 members, appointed as follows:
              (1) Three members shall be appointed by the President.
              (2) Four members shall be appointed by the Chairman of the
            Committee on Agriculture of the House of Representatives in
            consultation with the ranking minority member of the Committee.
              (3) Four members shall be appointed by the Chairman of the
            Committee on Agriculture, Nutrition, and Forestry of the Senate
            in consultation with the ranking minority member of the
            Committee.
      (b) Qualifications.--At least one of the members appointed under each
    of the paragraphs (1), (2), and (3) of subsection (a) shall be an
    individual who is primarily involved in production agriculture. All
    other members of the Commission shall be appointed from among
    individuals having knowledge and experience in agricultural production,
    marketing, finance, or trade.
      (c) Term of Members; Vacancies.--Members of the Commission shall be
    appointed for the life of the Commission. A vacancy on the Commission
    shall not affect its powers, but shall be filled in the same manner as
    the original appointment was made.
      (d) Time for Appointment; First Meeting.--The members of the
    Commission shall be appointed not later than October 1, 1997. The
    Commission shall convene its first meeting to carry out its duties
    under this Act 30 days after six members of the Commission have been
    appointed.
      (e) Chairman.--The chairman of the Commission shall be designated
    jointly by the Chairman of the Committee on Agriculture of the House of
    Representatives and the Chairman of the Committee on Agriculture,
    Nutrition, and Forestry of the Senate from among the members of the
    Commission.

    SEC. 603. COMPREHENSIVE REVIEW OF PAST AND FUTURE OF PRODUCTION
                        AGRICULTURE.

      (a) Initial Review.--The Commission shall conduct a comprehensive
    review of changes in the condition of production agriculture in the
    United States since the date of the enactment of this Act and the
    extent to which such changes are the result of the amendments made by
    this Act. The review shall include the following:
              (1) An assessment of the initial success of production
            flexibility contracts under section 103 in supporting the
            economic viability of farming in the United States.
              (2) An assessment of the food security situation in the
            United States in the areas of trade, consumer prices,
            international competitiveness of United States production
            agriculture, food supplies, and humanitarian relief.
              (3) An assessment of the changes in farmland values and
            agricultural producer incomes since the date of the enactment
            of this Act.
              (4) An assessment of the extent to which regulatory relief
            for agricultural producers has been enacted and implemented,
            including the application of cost/benefit principles in the
            issuance of agricultural regulations.
              (5) An assessment of the extent to which tax relief for
            agricultural producers has been enacted in the form of capital
            gains tax reductions, estate tax exemptions, and mechanisms to
            average tax loads over high and low income years.
              (6) An assessment of the effect of any Government
            interference in agricultural export markets, such as the
            imposition of trade embargoes, and the degree of implementation
            and success of international trade agreements.
              (7) An assessment of the likely affect of the sale, lease, or
            transfer of farm poundage quota for peanuts across State lines.
      (b) Subsequent Review.--The Commission shall conduct a comprehensive
    review of the future of production agriculture in the United States and
    the appropriate role of the Federal Government in support of production
    agriculture. The review shall include the following:
              (1) An assessment of changes in the condition of production
            agriculture in the United States since the initial review
            conducted under subsection (a).
              (2) Identification of the appropriate future relationship of
            the Federal Government with production agriculture after 2002.
              (3) An assessment of the personnel and infrastructure
            requirements of the Department of Agriculture necessary to
            support the future relationship of the Federal Government with
            production agriculture.
      (c) Recommendations.--In carrying out the subsequent review under
    subsection (b), the Commission shall develop specific recommendations
    for legislation to achieve the appropriate future relationship of the
    Federal Government with production agriculture identified under
    subsection (a)(2).

    SEC. 604. REPORTS.

      (a) Report on Initial Review.--Not later than June 1, 1998, the
    Commission shall submit to the President, the Committee on Agriculture
    of the House of Representatives, and the Committee on Agriculture,
    Nutrition, and Forestry of the Senate a report containing the results
    of the initial review conducted under section 603(a).
      (b) Report on Subsequent Review.--Not later than January 1, 2001, the
    Commission shall submit to the President and the congressional
    committees specified in subsection (a) a report containing the results
    of the subsequent review conducted under section 603(b).

    SEC. 605. POWERS.

      (a) Hearings.--The Commission may, for the purpose of carrying out
    this Act, conduct such hearings, sit and act at such times, take such
    testimony, and receive such evidence, as the Commission considers
    appropriate.
      (b) Assistance From Other Agencies.--The Commission may secure
    directly from any department or agency of the Federal Government such
    information as may be necessary for the Commission to carry out its
    duties under this Act. Upon request of the chairman of the Commission,
    the head of the department or agency shall, to the extent permitted by
    law, furnish such information to the Commission.
      (c) Mail.--The Commission may use the United States mails in the same
    manner and under the same conditions as the departments and agencies of
    the Federal Government.
      (d) Assistance From Secretary.--The Secretary of Agriculture shall
    provide to the Commission appropriate office space and such reasonable
    administrative and support services as the Commission may request.

    SEC. 606. COMMISSION PROCEDURES.

      (a) Meetings.--The Commission shall meet on a regular basis (as
    determined by the chairman) and at the call of the chairman or a
    majority of its members.
      (b) Quorum.--A majority of the members of the Commission shall
    constitute a quorum for the transaction of business.

    SEC. 607. PERSONNEL MATTERS.

      (a) Compensation.--Each member of the Commission shall serve without
    compensation, but shall be allowed travel expenses including per diem
    in lieu of subsistence, as authorized by section 5703 of title 5,
    United States Code, when engaged in the performance of Commission
    duties.
      (b) Staff.--The Commission shall appoint a staff director, who shall
    be paid at a rate not to exceed the maximum rate of basic pay under
    section 5376 of title 5, United States Code, and such professional and
    clerical personnel as may be reasonable and necessary to enable the
    Commission to carry out its duties under this Act without regard to the
    provisions of title 5, United States Code, governing appointments in
    the competitive service, and without regard to the provisions of
    chapter 51 and subchapter III of chapter 53 of such title, or any other
    provision of law, relating to the number, classification, and General
    Schedule rates. No employee appointed under this subsection (other than
    the staff director) may be compensated at a rate to exceed the maximum
    rate applicable to level GS-15 of the General Schedule.
      (c) Detailed Personnel.--Upon request of the chairman of the
    Commission, the head of any department or agency of the Federal
    Government is authorized to detail, without reimbursement, any
    personnel of such department or agency to the Commission to assist the
    Commission in carrying out its duties under this section. The detail of
    any such personnel may not result in the interruption or loss of civil
    service status or privilege of such personnel.

    SEC. 608. TERMINATION OF COMMISSION.

      The Commission shall terminate upon submission of the final report
    required by section 604.

                  TITLE VII--EXTENSION OF CERTAIN AUTHORITIES

    SEC. 701. EXTENSION OF AUTHORITY UNDER PUBLIC LAW 480.

      Section 408 of the Agricultural Trade Development and Assistance Act
    of 1954 (7 U.S.C. 1736b) is amended by striking ``1995'' and inserting
    ``1996''.

    SEC. 702. EXTENSION OF FOOD FOR PROGRESS PROGRAM.

      Section 1110 of the Food Security Act of 1985 (7 U.S.C. 1736o), also
    known as the Food for Progress Act of 1985, is amended--
              (1) in subsection (k), by striking ``1995'' and inserting
            ``1996''; and
              (2) in subsection (l), by striking ``1995'' and inserting
            ``1996''.

                               Brief Explanation

        H.R. 2854, the ``Agricultural Market Transition Act'', as
    amended in Committee, will substantially reduce projected
    agriculture spending for farm commodity programs over the
    period, fiscal years 1996 through 2002.
        It is substantially similar to title I of H.R. 2491, that
    was cited as the ``Agricultural Reconciliation Act of 1995''.
    This bill is designed to reform U.S. agricultural policy to
    perhaps the greatest extent since the 1930's. The bill also
    substantially conforms to the reconciliation instructions as
    they relate to farm programs as directed to the Committee on
    Agriculture in House Concurrent Resolution 67, the Current
    Resolution on the Budget--Fiscal Year 1996. The provisions in
    the bill recognize the realities of a post-GATT and NAFTA world
    trade environment within which U.S. farmers and producers must
    compete as we approach the 21st Century.

                                Purpose and Need

                title i--agricultural market transition program

    Summary

        The reforms accomplished by H.R. 2854 will help transition
    U.S. agricultural producers into a new era of a market-oriented
    Federal farm policy while simultaneously providing fixed,
    declining payments over seven years in order to minimize the
    economic distortions resulting from the change away from the
    New Deal Era Federal farm programs. These reforms in Federal
    farm program policy in this title also have substantial
    savings. It is understood that the December 1995 baseline was
    used by the Congressional Budget Office in preparing the
    estimates for this bill, including the savings that could be
    achieved from Federal farm programs over the fiscal years 1996
    through 2002; however, that estimate was not available at the
    time this report was being prepared and the estimate itself,
    while substantial, appears elsewhere in this report as noted in
    the table of contents.

    Background

        Since the last time Federal commodity programs were
    addressed in a farm bill (1990) or in a reconciliation bill
    (1993), major changes in world trade policy, domestic budget
    policy, and commodity producer opinion require a
    reconsideration of Federal commodity policy.
        For the last ten years, congressional farm policy actions
    have been driven by budget reductions. The 1995 debate over
    Federal farm programs has re-affirmed the Federal budget as the
    driving force for agricultural program policy. Modifications
    made to the original farm programs since their inception have
    revolved around two main goals: further restricting supply in
    order to alleviate the overproduction which the programs
    encourage; and decreasing Federal expenditures by limiting the
    amount of production which is covered by Federal subsidies.
    These two factors have combined in a way which has made current
    Federal commodity programs less effective, both as a means of
    increasing farm income and as a means to manage production,
    with each successive modification. There have been several
    recent situations where producers, who received an advance
    deficiency payment based on U.S.D.A. estimated low prices, have
    had a poor harvest and were required to repay the advance
    because the nation-wide effect of the poor harvest was to drive
    up the market price of the commodity beyond the point at which
    current programs make a payment. This has placed many producers
    in a difficult position. Even though prices were high, their
    income is down because they have no crop to market and the
    government assistance they had previously received must be paid
    back.
        Government outlays under current programs are the highest
    when prices are lowest (and hence when harvests are the best).
    This has had the effect of encouraging production based on
    potential government benefits, not on market prices. This
    incentive, when combined with the government's authority to
    idle acreage (which is the only means that current programs
    contain for limiting budget outlays) results in a situation in
    which producers have an incentive to produce the maximum amount
    of commodities while the government restricts the acres that
    can be planted, thereby encouraging the over-use of fertilizers
    and pesticides in order to get the most production from the
    acres the government is allowing the farmer to plant that year.
    This environmentally-questionable incentives created by current
    programs have also resulted in Congress authorizing greater and
    greater bureaucratic controls on producers over the last ten
    years in order to minimize environmental damage by requiring
    conservation compliance plans, compliance with wetlands
    protection provisions, and compliance with many other land-use
    statutes. It would be hard to imagine a program which creates
    more inconsistent incentives than the existing commodity
    programs.
        The new majority in the 104th Congress is committed to
    balancing the budget. With the passage of the first Budget
    Resolution in June, the House Committee on Agriculture, despite
    having cut over $50 billion in budget authority in recent
    years, was directed in H. Con. Res. 67, the FY 1996 Budget
    Resolution to achieve $13.4 billion in savings from Federal
    farm programs over the next seven fiscal years. Admittedly,
    reducing Federal spending by that amount will impact farmers.
    However, some economists predict that a balanced budget will
    lead to a 1.5 percent reduction in interest rates. Agriculture
    is a major user of credit, with over $140 billion borrowed in
    short and long term debt, and would benefit from such a result.
    If interest rates decline by 1.5 percent, a balanced budget
    could lead to an interest rate savings for U.S. agricultural
    producers exceeding $15 billion over the next 7 years.
        Following 19 hearings on Federal farm program policy by the
    Subcommittee on General Farm Commodities and the full Committee
    on Agriculture, the call from throughout the United States was
    clear: agricultural producers wanted more planting flexibility,
    more certainty with respect to Federal assistance, and less
    Federal regulatory burden. The combination of these factors led
    to the following conclusions: (1) the U.S. production
    agriculture industry needed to become more market-oriented,
    both domestically and internationally; (2) the industry could
    not become more market-oriented with a continued Federal
    involvement that simply extended the current supply-management
    policies of the past; and (3) the required budget cuts would
    not provide adequate funding levels to allow the existing
    Federal programs to function properly in a post-GATT and NAFTA
    world-oriented market.

    Rationale

        Analyzing the above-mentioned conclusions in conjunction
    with a review of the current Federal commodity price support
    and production adjustment programs resulted in several
    observations about agricultural policy.
        First, current Federal farm programs are based on the 60
    year old New Deal principle of utilizing supply management in
    order to raise commodity prices and farm income. When the
    Federal farm programs were first created, the government relied
    on a system of quotas and allotments to control supply.
    However, over the last 20 years the primary justification for
    the programs has been that producers receive Federal assistance
    in return for setting aside (idling). That assistance was
    largely in the form of deficiency payments to compensate
    producers for market prices or loan levels that fell below a
    Congressionally mandated target price for their production.
    Additionally, when Federal commodity programs were set up,
    world markets were not a major factor in determining
    agricultural policy. This approach, while perhaps appropriate
    in the 1930's, ignores the realities of a post-GATT and NAFTA
    world.
        Second, current programs no longer achieve their original
    goals and have collapsed as an effective way to deliver
    assistance to producers. Worldwide agricultural competition
    usurps foreign markets when the United States reduces
    production. With respect to wheat, for example, world demand,
    when combined with the United States' supply control approach
    of idling acreage (including acreage idled under the
    Conservation Reserve Program), has tightened U.S. supplies so
    much that there have been no set-asides for five years and
    there are not expected to be any in the foreseeable future,
    which eliminates the supply management policy justification for
    the present policy.
        Third, preserving the current Federal farm program
    structure with Budget Committee instructions that require
    substantial spending cuts will leave producers with an
    ineffective and counter-productive agricultural policy. The
    resulting system would be an emasculated remnant of an out-of-
    date 1930's-era program which no longer serves the people it
    was originally intended to benefit. While further modifications
    of current Federal commodity programs may accomplish required
    budget savings, ten years of budget cuts has changed the
    fundamental nature of farm programs to the extent they have
    inhibited farm production and producer earning potential.

    Good policy for the future

        Retaining the present policy would be a mistake when other
    methods can achieve the goals of providing U.S. producers with
    increased planting flexibility and less regulatory burden while
    at the same time allowing for greater earnings from the
    marketplace and reducing the budgetary exposure to the Federal
    Government.
        The changes in Federal agricultural policy reflected in
    H.R. 2854 are good policy for the future of production
    agriculture in the United States. The most severe critics of
    current farm programs, including the New York Times, the
    Washington Post, the Economist, and a host of regional
    newspapers, have hailed the concept incorporated in this bill
    as the most significant reform in agricultural policy since the
    New Deal in the 1930's. Congressional critics that have urged
    reform of the farm programs have also indicated that the
    approach in this bill embodies the type of reform necessary to
    transition agriculture into a market-oriented industry. Nearly
    every agricultural economist who has commented on the substance
    of what this bill does has supported its concept of structure,
    its probable effect on producers, and the agricultural sector.

    Commodity program reforms

        Title I of this bill replaces the commodity price support
    and production adjustment programs of the 1970's through 1990's
    with a seven-year production flexibility contract payment for
    eligible owners and operators and a nonrecourse marketing
    assistance loan program for eligible producers. Contract
    participants will receive seven annual market transition
    payments in exchange for maintaining compliance with their
    respective conservation plans and applicable wetlands
    protection provisions. Producers utilizing the marketing
    assistance loan will get the benefit of a nonrecourse loan at
    harvest time so that they will not have to sell commodities at
    a time when market prices are historically low in order to
    maintain a positive cash flow. Additionally, contract payments
    are limited to $40,000 limitation under the three-entity rule
    as contained in amended provisions of section 1001 through
    1001C of the Food Security Act of 1985. In addition a $75,000
    limitation is provided for marketing loan gains and loan
    deficiency payments using the standards of the three entity
    rule. The Secretary is also directed to implement adequate
    safeguards to protect the interests of operators who are
    tenants and sharecroppers.
        From a GATT perspective, the termination of the commodity
    price support programs will make U.S. commodities immediately
    more competitive on the world market by removing the distorting
    effect that current programs have maintained. This is
    significant because, at the current time, world commodity
    supplies are relatively tight and estimates indicate that, at
    best, this situation will remain for quite some time.
        With respect to domestic farm policy, H.R. 2854
    accomplishes several goals. First, it accomplishes a large
    amount of deregulation by freeing farmers up to farm for the
    market and not the government program. By removing government
    production controls on land use, the bill effectively
    eliminates the number one complaint of producers about the
    programs: bureaucratic red tape and government interference.
    Complaints about endless waits at the county office should end.
    Hassles over field sizes and whether the right crop was planted
    to the correct amount of acres should be a thing of the past.
    People concerned about the environment will be pleased that the
    government no longer forces the planting of surplus crops and
    monoculture agriculture. Producers who want to introduce a
    rotation on their farm for agronomic reasons should be free to
    do so within the restrictions in current programs.
        Secondly, H.R. 2854 provides U.S. producers with a
    guaranteed payment for the next seven years, because it
    establishes a contract between the Federal government and the
    producer. When compared to the alternative of further modifying
    existing programs, it results in the optimum producer net
    income over the next seven years and protects the producer from
    further budget cuts should there be further budget
    reconciliation bills in the future. The guarantee of a fixed
    (albeit declining) payment for seven years will provide the
    predictability that producers have wanted and will provide
    certainty to lenders as a basis for extending credit to
    production agriculture. The current situation in which prices
    are above the target price as a result of poor crops (producers
    do not get a payment or are forced to repay advanced payments),
    and therefore have less income should be corrected under H.R.
    2854. Without a crop to market, producers cannot benefit from
    the higher prices, and instead of getting help when they need
    it most, the current system cuts off their deficiency payments
    and demands that they repay advance deficiency payments.
        This bill insures that whatever government financial
    assistance is available will be delivered, regardless of the
    circumstances, because the producer signs a contract with the
    Federal Government for the next seven years. Just as producers
    will need to look to the market for planting and marketing
    signals, H.R. 2854 will require producers to manage their
    finances to compensate for price swings. It may be true that
    when prices are high, producers will receive a full market
    transition payment under this legislation, but it is equally
    true that if prices decline, farmers will receive no more than
    the fixed market transition payment. That means the individual
    producer must manage all income, both market and government, to
    account for weather and price fluctuations.
        Third, this measure also encourages market orientation.
    Producers can plant or idle all their acres at their
    discretion, with a significant reduction in the restrictions on
    what can be planted. Producers will have to make commodity
    planting decisions in response to commodity markets instead of
    decisions based on deficiency payment rates and crop acreage
    bases. Decoupling Federal payments from production (a process
    which began in 1985 when payment yields were frozen) would end
    any pressure from the government in choosing crops to plant.
    Under H.R. 2854, all production incentives should come from the
    marketplace and not government programs. Additionally, as long
    as producers maintain compliance with their applicable
    conservation plans, they are free to choose to plant no crop at
    all, which will benefit soil and water quality in marginal
    areas, as well as benefiting wildlife.
        Fourth, H.R. 2854 recognizes that the benefits from current
    programs have, to some extent, been incorporated into the value
    of agricultural land. By abolishing the link between production
    and benefits, but doing so in a manner which provides a seven-
    year transition period, the economic distortions caused by
    existing programs can be removed in a manner that causes the
    least amount of disruption and harm to rural America. For that
    reason the production flexibility contract payment has been
    aptly named as a market transition payment.

    Peanuts and sugar

        The Committee also commenced hearings and received
    testimony from over 100 witnesses in the areas of the United
    States where peanuts and sugar beets, sugar cane, and corn are
    grown, as well as in Washington, D.C., to discuss reform of the
    peanut and sugar programs. The outcomes of these hearings led
    the Committee to outline reform criteria with the goal of
    revising the current peanut and sugar programs to make them
    more market-oriented and operate at no cost to the Federal
    Government, while still providing a safety net for producers.
    These reforms are contained in sections 106 and 107 of Title I.
                Peanuts
        According to the United States Department of Agriculture
    (USDA), net peanut government program expenditures for fiscal
    year 1995 are estimated to be $85.6 million. USDA projects an
    annual cost of $76 million per year for fiscal years 1996-2000
    if current program provisions were retained. The changes in
    section 106 would eliminate the costs of the program through
    the elimination of the national poundage quota and
    undermarketing provisions which would allow additional peanuts
    to receive the quota price support rate. This will allow the
    Secretary to set the national poundage quota at a level that
    satisfies the estimated domestic consumption and prevent
    additional peanuts from entering quota pools at the higher
    quota support rate. Additional provisions allow the Secretary
    of Agriculture to increase the marketing assessment as needed
    to assure that the peanut program is not costly to the
    government.
        With respect to price support, section 106 would freeze the
    support loan rate for quota peanuts at $610 per ton for the
    1996 through 2002 crops. This is a reduction from the current
    loan rate of $678 per ton, and is approximately commensurate to
    a price support level based on current cost of production.
    Current law provides that the price support level may only
    increase based on cost of production, up to 5% over the support
    rate for the preceding year. If the previous years' quota price
    support rates were allowed to increase or decrease 5% per year,
    today's price support level would be approximately $608.64.
        Among other changes, section 106 would also instruct the
    Secretary to decrease the quota support rate by 5 percent to
    any producer who receives an offer at quota price or higher
    from a commercial buyer and the government but opts to sell to
    the government. This provision is intended to provide an
    incentive to producers to sell peanuts to the market rather
    than to the government.
        Section 106 would also prioritize the method of covering
    losses in area quota pools. Losses would first be covered by
    offsetting proceeds due any producer with losses incurred by
    the transfer of additional peanuts to a quota loan pool under
    section 358-1(b)(8) of the Agricultural Adjustment Act of 1938,
    then by offsetting individual producer gains and losses, then
    by buy-back gains within an area, then by use of the marketing
    assessment attributable to the producer, then with area cross
    compliance provisions (including buy-back gains in other
    areas). The Secretary of Agriculture would also be given the
    authority to increase the marketing assessment on growers in a
    pool to cover any further losses, with a provision directing
    any unused assessment funds to be returned to the Treasury.
        With respect to the sale, lease, and transfer of quota,
    several changes are made. Currently, quota can only be sold or
    leased to another owner or operator in the fall or after the
    normal planting season within the same county. Section 106
    would allow full sale, lease or transfer of quota to any county
    within a State either in the spring or fall, while maintaining
    the fall transfer required of at least 90 percent of a farm's
    quota having been planted during the previous growing season. A
    temporary quota allocation, equal to a producer's seed use, is
    also provided, while seed use is no longer part of the
    Secretary's national poundage quota estimate. Disaster transfer
    provisions are modified to limit disaster transfers to no more
    than 25% of a farm's quota, at 70% of the quota support rate.
    The Committee also proposes a review of the feasibility of
    quota transfer of across state lines under the purview of the
    Commission on 21st Century Production Agriculture.
        In addition, the Committee's recommendation would tighten
    the eligibility of those who own quota by mandating that,
    beginning with the 1997 marketing year, public entities and
    non-resident quota holders who are not producers are no longer
    eligible to own quota. Any quota held by such entities at the
    end of the 1996 marketing year would be reallocated within each
    State.
                Sugar
        Modifications to the sugar program in section 107 would
    increase revenue to the Treasury through an increased marketing
    assessment from 1.1% in 1996 to 1.375% in 1997 through 2003 of
    the loan rate for raw cane sugar and from 1.1794% to 1.47425%
    of the loan rate for beet sugar. Provisions in current law
    mandating that the program operate at no net cost to the
    Treasury would be maintained, and a forfeiture penalty of
    1 cents/lb would be imposed on any processor who forfeits sugar
    to the government.
        Sugar beet and sugar cane loan rates are frozen at
    18 cents/lb for raw cane sugar and 22.9 cents/lb for refined
    beet sugar. However, loan rates are required to be reduced if
    the Secretary determines that negotiated reductions in export
    subsidies and domestic subsidies provided for sugar of the
    European Union and other major sugar growing countries in the
    aggregate exceed the commitments made as part of the Uruguay
    Round Agreement.
        With respect to marketing allotments, the Committee's
    recommendation would allow full and unrestrained production of
    sugar in the United States through elimination of marketing
    allotments.
        The Committee also proposes a consistent increase of
    imports through the establishment of a loan modification
    threshold which is triggered when tariff rate quota imports
    exceed 1,500,000 short tons raw value. Under this provision,
    recourse loans to processors are made available up to the
    threshold level and would be converted into nonrecourse loans
    if imports rise above the threshold level.

                                Title II--Dairy

    Summary

        Subtitle II reforms Federal dairy policy in three stages.
        First, there are legislative reforms which are implemented
    immediately: (1) the dairy price support program is altered by
    removing butter and nonfat dry milk from support; (2) the
    budget assessment on producers is eliminated, (3) a recourse
    loan program for processors of cheddar cheese, butter, and
    nonfat dry milk is established; (4) the Dairy Export Incentive
    Program (DEIP) is reauthorized through September 30, 2002, and
    fully funded to the limits permitted by the Uruguay Round of
    the GATT; and (5) the producer assessment for promotion under
    the Dairy Production Stabilization Act of 1983 is extended to
    imported products.
        Secondly, administrative reform of the Federal milk
    marketing order program will occur at the end of two years. In
    the upcoming two years, the Secretary will: (1) consolidate
    Federal orders and other milk producing areas in the
    continental 48 states into not less than 8 nor more than 13
    orders; (2) implement uniform multiple component pricing for
    milk used to produce manufactured dairy products; and (3)
    establish class prices for milk used to produce cheese nonfat
    dry milk, and butter based on national product prices less a
    make allowance (which shall not vary regionally except to
    reflect variances in transportation and reasonable operating
    costs, if any, of efficient processing plants in different
    geographic areas).
        Thirdly, there are temporary changes in Federal dairy
    programs that will occur during the two-year transition period
    between the date of enactment of the Act and the implementation
    date of the administrative reforms: (1) a maximum manufacturing
    allowance which a state may provide for milk used to
    manufacture certain dairy products during that two-year period
    is set; (2) a floor is placed on the minimum price for Class I
    (fluid) milk and a Class I equalization pool is set up to more
    equitably share Class I revenues nationally during the two-year
    transition period; and (3) a Class IV price is created for milk
    used to produce butter, butter oil, nonfat dry milk, and whole
    milk, and a Class IV equalization pool is created to equitably
    share among all producers 50 percent of any negative difference
    between the support price for milk used to produce cheese and
    the Class IV price.
        The combined impact of these changes saves $454 million, or
    approximately 21%, of spending on Federal dairy programs
    projected by CBO over the next seven fiscal years.

    Background

        Since the last time Federal dairy programs were addressed
    in a farm bill (1990) or in reconciliation (1993), major
    changes in world trade policy, domestic budget policy, and
    dairy producer opinion require us to reconsider Federal dairy
    policy.
        Every Federal dairy program was created subsequent to
    Section 22 and premised upon the ability of Section 22 to stop
    foreign dairy products at our border. As of July 1, 1995,
    Section 22 was limited in its applicability by the
    implementation legislation for the Uruguay Round of the GATT.
        With the passage of the First Budget Resolution in June,
    the House Agriculture Committee was required to achieve $13.4
    billion in savings on Federal farm programs over the next seven
    fiscal years. As a commodity, dairy needed to come up with
    between $400 and $500 million of that amount.
        Following ten hearings on dairy issues by the Subcommittee
    on Livestock, Dairy and Poultry, including field hearings in
    California, Florida, Minnesota, New York, and Wisconsin, the
    mandate from dairy farmers to end budget reconciliation
    assessments immediately became overwhelming. The elimination of
    assessments would decrease funding available for Federal dairy
    programs by approximately $250 million annually.
        The combination of these events led to the following
    conclusions: (1) the U.S. dairy industry needed to become more
    market-oriented, domestically and internationally; (2) the
    industry could not become more market-oriented without a level
    playing field at home; (3) the industry needed tools to become,
    and remain, competitive in the world market; and (4) there was
    inadequate funding to retain and maintain existing Federal
    dairy programs.
        A review of Federal dairy programs (i.e., dairy price
    supports, Federal milk marketing orders, and the Dairy Export
    Incentive Program (DEIP)) produce the following conclusions.
        First, since the support price was decreased to $10.10/cwt
    in the 1990 Farm Bill, the dairy price support program has been
    largely inactive. For example, in the last 12 months, the
    Commodity Credit Corporation (CCC) has not purchased any cheese
    and only purchased 26 million pounds of butter and 27 million
    pounds of nonfat dry milk. By contrast, a decade ago the CCC
    purchased 293 million pounds of butter, 591 million pounds of
    cheese, and 827 million pounds of nonfat dry milk during the
    same 12 months period. At the end of 1995, we had no butter, no
    cheese, and only 14 million pounds of nonfat dry milk in
    government storage.
        Secondly, existing Federal milk marketing orders act as an
    impediment to a level playing field domestically. The U.S.
    dairy industry cannot hope to be competitive in the world
    market if our domestic marketing system produces competitive
    advantages and disadvantages at home unrelated to market
    indicators and other economic conditions. The Congressional
    Budget Office projects that Class I differentials, fixed by
    statute in 1985, will add an average of $134 million annually
    to the cost of the dairy price support program in the next five
    fiscal years by creating artificial incentives to produce milk
    in regions with sufficient Class I supplies of milk. Studies of
    Federal milk marketing orders by the General Accounting Office
    in 1988 and 1995 have produced similar conclusions.
        Thirdly, the inactivity of the dairy price support program
    and the low levels of government-stored dairy products are
    directly related to the success of the DEIP program. Dairy
    economists across the nation uniformly agree that the DEIP
    program has added between $.50/cwt to $1.00/cwt to producer
    prices in each of the last five years.

    Rationale

        With these conclusions in mind, the following changes in
    Federal dairy policy are accomplished in this legislation which
    have a cumulative reconciliation savings of $454 million
    estimated by the Congressional Budget Office.
        Subtitle A of Title II extends the price support program of
    milk by authorizing the Secretary to continue removing excess
    cheddar cheese from the commercial market through December 31,
    2002 in section 201. However, the authority of the Secretary to
    support the price of milk through purchases of excess butter
    and nonfat dry milk is eliminated.
        From a GATT perspective, removing butter and nonfat dry
    milk from support will make those commodities immediately
    competitive on the world market. This is significant because,
    by the end of the decade, 17 percent of the world market for
    nonfat dry milk and 31 percent of the world market for butter
    will have opened up due to reductions in subsidized exports
    under the Uruguay Round.
        Removing butter and nonfat dry milk from support and
    reducing the support price for milk used to produce cheese from
    its current level of $10.35/hundredweight of $9.85/
    hundredweight in the year 2001 permits the immediate
    elimination of the budget assessment on producers (currently at
    10 cents/hundredweight).
        The recourse loan program created under section 202 will
    allow processors of cheddar cheese, butter and nonfat dry milk
    to place their product under a recourse loan with the CCC at 90
    percent of the average market value for that product during the
    previous three months. Loans will be at CCC interest rates and
    will come due at the end of the fiscal year (September 30), but
    can be extended into the upcoming fiscal year.
        Section 203 further enables the United States to become,
    and remain, a player in the world dairy market of the 21st
    Century. The DEIP program is reauthorized through September 30,
    2002 and fully funded to the limits permitted under the Uruguay
    Round in each fiscal year.
        Section 204 also assists the industry in becoming more
    market-oriented by requiring that at least 10 percent of the
    budget of the National Dairy Promotion and Research Board be
    allocated to international market development annually, and by
    extending the producer promotion assessment under the Dairy
    Production Stabilization Act of 1983 to imported dairy
    products, thereby enhancing available funding for the Board's
    promotion activities.
        Subtitle B of Title II requires the Secretary of
    Agriculture to implement significant reforms in Federal milk
    marketing orders within two years including the consolidation
    of existing Federal orders and areas currently outside of
    Federal orders into not less than 8 nor more than 13 orders
    (with California as a separate order within that system and
    with each order authorized to blend order proceeds as necessary
    to address issues unique to that order such as pre-existing
    state quota programs), uniform component pricing for milk used
    to produce manufactured dairy products, and class prices for
    milk used to produce cheese, nonfat dry milk, and butter based
    on national product prices less a make allowance (which shall
    not vary regionally except to reflect variances in
    transportation and reasonable operating costs, if any, of
    efficient processing plants in difference geographic areas).
        Expedited comprehensive administrative reform under
    sections 221 and 222 will assure a level playing field
    domestically among producers at the end of two years and will
    further insure that the dairy industry will respond to market
    signals rather than decade-old fixed differentials which
    provide artificial incentives to produce milk in some areas of
    the country.
        In the interim two years, sections 206, 207 and 208 will
    also provide greater equity between producers and processors in
    different regions of the country by setting a reasonable
    maximum state manufacturing allowance, creating a minimum price
    floor for Class I milk and sharing $.80/hundredweight of Class
    I proceeds nationally, and establishing a Class IV price for
    butter, butter oil, nonfat dry milk, and whole dry milk and
    sharing among all producers 50 percent of any negative
    difference between the support price for milk used to produce
    cheese and that Class IV price.
        During this time, net income to producers in all regions of
    the country is projected to increase as a result of the
    foregoing changes in Federal dairy policy, thereby
    accomplishing all three goals of a modern Federal dairy
    policy--international competitiveness, a level domestic playing
    field, and enhanced producer income.

                            Title III--Conservation

        The changes in title III are designed to improve and add to
    the existing conservation programs that have been successful in
    the past, while addressing pressing problems facing
    agricultural producers today.
        Title III creates a new program, the Livestock
    Environmental Assistance Program (LEAP). LEAP has been added to
    title XII of the Food Security Act of 1985, to assist farmers,
    ranchers, dairy and livestock producers in dealing with the
    many environmental challenges with respect to soil and water
    quality that they face, largely because of other Federal
    mandates such as the Clean Water Act. The program is
    established to help eligible producers improve environmental
    problems such as water quality by providing technical and cost-
    share assistance in implementing structural and management
    practices to protect water, soil and related resources from the
    degradation associated with livestock production. The program
    is authorized at $100 million annually through 2002.
        Title III modifies the Wetlands Reserve Program (WRP) by
    replacing permanent easement authority with 15-year easement
    authority. This change saves $384 million by lowering the costs
    of acquiring easements, yet it will not affect the future
    success of this program because of the overall changes in both
    the Federal involvement in agriculture and the public attitude
    toward wetlands today. The previous incentive to get drain or
    fill of wetlands, both by the Army Corps of Engineers and the
    U.S. Department of Agriculture, is simply not present today.
    Also, the entire country now realizes that wetlands serve a
    vital purpose in supporting wildlife and improving water
    quality. The WRP will continue to allow USDA to provide
    incentives to help people return acreage into wetlands.
        Title III also modifies the Conservation Reserve Program
    (CRP) by permanently capping overall enrollment at 36.4 million
    acres. As of the date of enactment, the Committee will ratify
    four years of Appropriations Committee policy by capping the
    CRP at the current acreage of 36.4 million acres.
        The Committee strongly supports maintaining a strong and
    viable CRP that maximizes, to the extent practicable, the
    ability of producers to utilize the program to protect
    environmentally sensitive lands, conserve natural resources,
    and make rational farm or land management decisions.

              title iv--agricultural promotion and export programs

    Marketing Promotion Programs

        The Agricultural Trade Act of 1978 provides that a minimum
    of $200 million for fiscal years 1991 through 1993 and $110
    million for fiscal years 1994 through 1997 of CCC funds or
    commodities be made available to carry out the Marketing
    Promotion Programs. Section 401 of this bill provides that not
    more than $100 million of CCC funds or commodities could be
    made available to carry out the Marketing Promotion Programs
    for fiscal years 1996 through 2002.

    Export Enhancement Program

        Section 301 of the Agricultural Trade Act of 1978 provides
    that a minimum of $500 million in Commodity Credit Corporation
    funds or commodities be made available each of fiscal years
    1991 through 2001 to carry out the Export Enhancement Program.
    Section 402 of this bill provides that the Commodity Credit
    Corporation shall provide not more than $350 million in fiscal
    years 1996 and 1997, $500 million in fiscal year 1998, $550
    million in fiscal year 1999, $579 million in fiscal year 2000,
    and $478 million in fiscal years 2001 and 2002 to carry out the
    Export Enhancement Program.

                             Title V--Miscellaneous

        The Federal Crop Insurance reform Act of 1994 (Reform Act),
    contained in Title I of P.L. 103-354, made significant changes
    in the multi-peril crop insurance (MPCI) program as well as
    ending, for all practical purposes, ad hoc Federal assistance
    to farmers for crop failures. Two controversial and complex
    provisions of the new law have caused consternation and
    irritation among agricultural producers, and that, in turn, has
    made MPCI a less attractive product for many farmers.
        A principal provisions of the Reform Act required any
    agricultural producer who is a farm commodity program or
    Conservation Reserve Program participant or who is receiving a
    loan or loan guarantee through the U.S. Department of
    Agriculture (USDA) to purchase a MPCI policy to insure against
    at least a catastrophic crop loss (CAT), i.e., for a crop loss
    of 50 percent loss in yield, on an individual or area yield
    basis. To obtain CAT coverage, producers pay an administrative
    fee for each crop produced in a county. Because of USDA's
    implementation of the Reform Act, each landlord who receives a
    program payment (shared tenancy) is required to pay the $50
    fee. This link between farm program participation and crop
    insurance caused a great deal of confusion and irritation among
    producers because of the inequities in USDA implementation. For
    example, an owner-operator growing only wheat on a section of
    land in a single county could purchase CAT coverage for a
    single $50 fee, while multiple owners with a tenant farming in
    more than one county were required to pay multiple fees.
        One particularly egregious case that came to light involved
    nine different landlords and their tenants who farmed three
    different crops in three counties. Each of the owners was
    required to pay three fees for each crop in each of the three
    counties, resulting a substantial amount of dollars in fees for
    insurance on a minimal number of acres.
        A second provision that caused undue confusion involved the
    delivery system implemented by the Consolidated Farm Service
    Agency (CFSA) within USDA. Because each agricultural producer
    could be required to purchase at least the CAT insurance
    policy, Congress allowed CFSA local offices to sell CAT
    coverage in those areas of the country where private insurance
    agents were not available or not readily available. As
    implemented, however, CFSA became an instant competitor with
    insurance agents around the country. Because the new MPCI
    program was late in clearing Congress and even later in getting
    into the field, local CFSA personnel obviously were confused
    during the initial start-up of the new program. This confusion
    was spread throughout farm country during this past spring and
    harmed a program that already was disliked and unused by a
    majority of producers in almost every part of the country.
        It also has come to the Committee's attention that the
    assistant administrator for risk management who is the FCIC
    manager and responsible for its day-to-day operations also has
    become totally absorbed by CFSA administrators to the extent
    that risk management and crop insurance are being run as if
    they were just another farm program, in other words, not in an
    actuarially-sound manner. Under any policy scenario, Federal
    farm price and income support programs are in transition,
    making it vitally important that our agricultural producers
    have sound risk management programs they can use the price and
    yield protection and marketing assistance without undue USDA
    intervention. Creating an independent agency and then subsuming
    the congressional policy objective of providing new risk
    management techniques, including MPCI offered generally through
    a private delivery system, within the scope of traditional, 50-
    year old New Deal policies does not make sense. Congress
    clearly set new policy and structural changes at the new CFSA,
    and thus far, CFSA has ignored many of those policy objectives.
        Amendments included in title V of H.R. 2854 change both the
    mandatory link of MPCI and USDA farm and credit programs so
    that producers not wanting to purchase CAT coverage could do so
    by waiving the right to any possible crop disaster assistance
    for the crop year in which CAT coverage had been offered by the
    FCIC but not purchased by the producer. This saves $180 million
    over the seven-year period.
        Additional amendments provide for a totally private
    delivery system in areas determined by the secretary to be
    adequately served by private insurance providers.
        Other amendments included in the budgetary provisions
    establish a fully independent Office of Risk Management with an
    administrator who will manage the FCIC as well as assume other
    risk management responsibilities enumerated by the amendments.
    The Secretary of Agriculture is directed to (shall) appoint the
    Administrator of the Office of Risk Management.
        Within the next year, the Secretary is directed to
    establish a business interruption insurance program that will
    allow producers to utilize a revenue-insurance based approach
    to risk management in lieu of, or in addition to, crop
    insurance.
        Title V would also give the Secretary discretion to
    continue to operate the Options Pilot Program, which was
    established by the Food, Agriculture, Conservation, and Trade
    Act of 1990 (the 1990 Act). By giving the Secretary authority
    to modify the program in order to reflect changes to the
    commodity programs made by this bill, USDA will continue to
    have the ability to offer farmers, on a pilot basis, the use of
    futures markets an another tool in managing risk.
        Finally, Title V amends section 2509 of the 1900 Act to fix
    a problem with the Agricultural Quarantine Inspection (AQI)
    user fee account. The 1990 Act authorized user fees for AQI
    inspection activities, including inspections of aircraft,
    vessels, trucks, railcars, and airline passenger baggage
    arriving in the U.S. from foreign countries. When this
    authority was originally proposed by USDA's Animal and Plant
    Health Inspection Service (APHIS), the method of collection,
    which was specified in the draft legislation, would have
    allowed airlines to collect the fees through the passenger
    ticketing process, with the fees being deposited into a
    dedicated U.S. Treasury account from which USDA would be
    reimbursed on a quarterly basis. This method would have been
    consistent with the collection processes of the U.S. Customs
    Service and the Immigration and Naturalization Service and
    would not have subjected the fees to the appropriation process.
    However, as passed, expenditure of the fees is subject to the
    appropriation process. This was done apparently because the
    Congressional Budget Office would not credit budget savings
    that are achieved through the assessment of user fees are
    subject to appropriation, so that the Agriculture Committee
    could ensure that the savings would be reflected in their
    budget process.
        Unfortunately, this method of collection and disbursement
    has created some problems. The process of requesting quarterly
    disbursements from the treasury is cumbersome, and the request
    for disbursement does not guarantee that the funds will be
    provided. An additional problem is the fact that the AQI
    program remains subject to staff-year limitations, even though
    passengers and airlines are now paying for the service. Staff
    year ceilings are set by the Office of Management and Budget,
    and because this process is separate from the budget process,
    the staff ceilings are not always consistent with the budget.
    This means that, in any given year, there may be adequate
    funding but inadequate staff levels, or adequate staff levels
    but inadequate funding.
        The amendment to the AQI program in title V would correct
    these problems. First through fiscal year 2002, APHIS would be
    able to access fees collected beyond the appropriated amount
    after the yearly appropriation bills are passed. Second,
    beginning in fiscal year 2003, the AQI user fee account truly
    becomes a user fee account, not subject to any appropriation.
    Finally, the staff-year limitation problem would also be
    remedied by exempting APHIS staff years used for AQI activities
    from the Federal Workforce Restructuring Act of 1994. These
    changes will ensure that the AQI program will function as a
    user fee program is supposed to function, and that APHIS will
    have the ability to have the necessary number of employees
    engaged in AQI activities.

          title vi--commission on 21st century production agriculture

        The changes in Federal farm policy made in the preceding
    subtitles are a dramatic departure from current farm commodity
    programs. Many of those involved in production agriculture from
    the farmer to the economist, to rural lenders, and especially
    to those with an economic interest in current programs, are
    concerned that a change of the magnitude described in the
    preceding titles coupled with less Federal subsidy dollars will
    adversely affect not only the U.S. agricultural industry, but
    also rural America. While the dramatic changes proposed for the
    Federal Government's involvement in agriculture as prescribed
    by H.R. 2854, are in fact a recognition of the changing rural
    and urban landscape of America, an examination of the changes
    wrought by these policy changes and what farm policies are
    needed for the 21st Century farm sector is in order.
        When the present Federal programs for agriculture were
    adopted, the nation was in the darkest depths of the Great
    Depression of the 1930's. Not everyone believed the Federal
    Government should get involved in agriculture. Indeed, the
    original Agricultural Adjustment Act of 1933 was declared
    unconstitutional by the Supreme Court. But a consensus was
    reached and the United States Government embarked upon a course
    of substantial involvement in agriculture. The present programs
    were claimed to be created out of political and economic
    necessity, because the nation was largely rural and the
    majority of the population lived on farms or rural areas.
        In the intervening 60 years, the United States has been
    transformed into a largely urban society with less than 2
    million citizens on farms. There is evidence that Federal farm
    programs may have eased the transition from a rural society to
    an urban society. While the U.S. is now largely an urban
    population, nearly 20 percent of the Gross National Product can
    be attributed to agriculture if the entire sector is
    considered, i.e., from the farm to the manufacturing,
    distribution, and input infrastructure involved in modern
    agriculture's miracle of productivity.
        The United States is blessed with a very valuable asset:
    fertile land, with adequate moisture, growing season, and
    dedicated users of such land that make it the envy of the
    world. The challenge for the United States as we enter the 21st
    Century is how do we wisely use our very valuable natural
    resource: agriculture. The present system of agricultural price
    supports and supply control programs have come under increasing
    attack by economists, environmentalists, and farmers as being
    inadequate for modern agriculture. The Agricultural Market
    Transition Act is meant to be a transition policy for U.S.
    agriculture. but a transition to what?
        Over the 7 years of the transition contract, the Congress
    hopes a national debate can take place as to what should be the
    Federal involvement in production agriculture in the 21st
    Century. Should it be a system of direct price supports found
    in the present system? Should it be some type of income support
    mechanism that provides some means of income or revenue
    protection given the nature of production agriculture, which is
    subject to the vagaries of weather, pestilence, and geo-
    political market disruptions. Should the Federal involvement in
    production agriculture be limited to only foreign market
    development and research that enhances U.S. agriculture's
    relative competitive position? Or can many of the goals
    necessary to have a healthy food and fiber sector be
    accomplished through Federal tax policy?
        To stimulate substantial debate and provide answers to
    these questions, title VI establishes a Commission on 21st
    Century Production Agriculture, which is designed to give
    future Congresses and Presidents and others information and
    feedback to gauge the effectiveness of the changes made by this
    legislation, and also to recommend further appropriate Federal
    policy and involvement in production agriculture. The
    Commission is to conduct a ``look-back'' (how successful is
    Agricultural Market Transition Act) and a ``look-to-the-
    future'' that recommends new or different policies for 21st
    Century agriculture.
        This commission, comprised of 11 members to be appointed by
    the President and the Chairmen of the House and Senate
    Agriculture Committees in consultation with their Ranking
    Minority Members, will conduct a comprehensive review of
    changes in the condition of the agricultural sector, taking
    into account land values, regulatory and taxation burdens,
    export markets, and progress under international trade
    agreements. The Commission will also make an assessment of
    changes in production agriculture, identify the appropriate
    future relationship between the Federal Government and
    production agriculture after 2002, and assess the future
    personnel and administrative needs of USDA. Not later than June
    1, 1998, the Commission is to report its interim findings with
    respect to its comprehensive review of the condition of the
    agricultural sector. Not later than January 1, 2001, the
    commission shall submit its final report concerning its
    assessments and determinations regarding the future role of the
    Federal Government in farm policy.

                  title vii--extension of certain authorities

        Provisions of the Agricultural Trade Development and
    Assistance Act of 1954, incorporating the Food for Peace
    program, and the Food for Progress Act of 1985, that authorize
    the U.S. Department of Agriculture (USDA) and the Agency for
    International Development (AID) to enter into new agreements
    with other governments, private voluntary organizations, and
    international organizations to finance and provide food
    assistance expired in 1995. Title VII of the bill extends this
    authority through 1996.
        Both USDA and AID will have the authority through 1996 to
    enter into agreements under the Food for Peace and Food for
    Progress programs to provide assistance under Title I of the
    Food for Peace program, Title II (non-emergency) of the Food
    for Peace program, operational support for private voluntary
    organizations and cooperatives, Title III of the Food for Peace
    program, the Farmer-to-Farmer program, and the Food for
    Progress program. Authority to enter into agreements under
    Title II (emergency) of the Food for Peace program was not
    affected, since the Act includes adequate authority to provide
    emergency assistance through the Food for Peace program.

                          Section-by-Section Analysis

    Section 1--Short title; table of contents

                   The ``AGRICULTURAL MARKET TRANSITION ACT''

                title 1--agricultural market transition program

    Section 101. Purpose

        The main purpose of this title is to authorize the use or
    binding production flexibility contracts between the United
    States and agricultural producers to support farming certainty
    and flexibility while ensuring continued compliance with farm
    conservation compliance plans and wetland protection
    requirements.

    Section 102. Definitions

        This section contains definitions of terms used throughout
    Title I. ``Contract commodity'' includes wheat, corn, grain
    sorghum, barley, oats, upland cotton, and rice; ``contract
    acreage'' means one or more crop acreage bases established
    under title V of the Agricultural Act of 1949 that would have
    been in effect for the 1996 crop; and ``loan commodity'' means
    each contract commodity plus extra long staple cotton and
    oilseeds.

    Section 103. Production flexibility contracts

        Section 103(a), in paragraph (1), authorizes the Secretary
    to enter into 7-year production flexibility contracts between
    1996 and 2002 with eligible owners and operators on a farm
    containing eligible farmland. In exchange for annual payments
    under the contract, the owner or operator must agree to comply
    with the applicable conservation plan for the farm, the wetland
    protection requirements of title XII of the Food Security Act
    of 1985, and the planting flexibility requirements of
    subsection (j).
        Section 103(a), in paragraph (2), describes eligible owners
    and operators, that include:
              (A) an owner who assumes all risk of producing a
            crop;
              (B) an owner who shares in the risk of producing a
            crop;
              (C) an operator with a share-rent lease regardless of
            the length of such lease if the owner also enters into
            the contract;
              (D) an operator with a cash rent lease that expires
            on or after September 30, 2002, in which case the
            consent of the owner is not required;
              (E) an operator with a cash rent lease that expires
            before September 30, 2002, and the owner consents to
            the contract;
              (F) an owner with a cash rent lease, but only if the
            operator declines to enter into a contract, in which
            case payments under the contract will not begin until
            the fiscal year following the year in which the lease
            expires; and
              (G) an owner or operator described in (A) through (F)
            regardless of whether the owner or operator purchased
            catastrophic risk protection for a fall-planted 1996
            crop under section 508(b) of the Federal Crop Insurance
            Act.
        Section 103(a), in paragraph (3), instructs the Secretary
    to provide adequate safeguards to protect the interests of
    operators who are tenants and sharecroppers.
        Section 103(b), in paragraph (1), provides that the
    deadline for entering into a contract is April 15, 1996, except
    that owners and operators on farms which contain acreage
    enrolled in the Conservation Reserve Program (``CRP'') may
    enter into a contract upon the expiration of the CRP contract.
        Section 103(b), in paragraph (2), provides that the
    contracts shall begin with the 1996 crop year and extend
    through the 2002 crop year.
        Section 103(b), in paragraph (3), provides that, at the
    time a contract is signed, the Secretary shall estimate the
    anticipated payments that will be made under the contract for
    at least the first fiscal year.
        Section 103(c) describes eligible farmland, which is land
    that contains a crop acreage base, at least of portion of which
    was enrolled in the acreage reduction programs authorized for a
    crop of rice, upland cotton, feed grains, or wheat and which
    has served as the basis for deficiency payments in at least one
    of the 1991 through 1995 crop years. With respect to contracts
    for acreage enrolled in the CRP, such contract acreage must
    have crop acreage base attributable to it.
        Section 103(d) establishes the payment dates under the
    contracts as September 30 of each of the fiscal years 1996
    through 2002, and provides that an owner or operator may opt to
    receive half of each annual payment on December 15 of each
    fiscal year 1997-2002. For the 1996 fiscal year, an owner or
    operator may elect to receive half of the payment not later
    than June 15.
        Section 103(e), in paragraph (1), establishes spending
    limits of:
              (A) $5,570,000,000 for FY 1996;
              (B) $5,385,000,000 for FY 1997;
              (C) $5,800,000,000 for FY 1998;
              (D) $5,603,000,000 for FY 1999;
              (E) $5,130,000,000 for FY 2000;
              (F) $4,130,000,000 for FY 2001; and
              (G) $4,008,000,000 for FY 2002.
        Section 103(e), in paragraph (2), allocates the fiscal year
    amounts among the contract commodities as follows:
              (A) Wheat, 26.26 percent;
              (B) corn, 46.22 percent;
              (C) grain sorghum, 5.11 percent;
              (D) barley, 2.16 percent;
              (E) oats, 0.15 percent;
              (F) upland cotton, 11.63 percent; and
              (G) rice, 8.47 percent.
        Section 103(e), in paragraph (3), directs the Secretary to
    adjust the amounts allocated in paragraph (2) for a particular
    fiscal year by:
              (A) adding producer repayments of deficiency payments
            received during that fiscal year under section
            114(a)(2) of the Agricultural Act of 1949 (as then in
            effect);
              (B) adding contract payments withheld at the request
            of producers, during the preceding fiscal year as an
            offset against repayments of deficiency payments
            otherwise required under section 114(a)(2) of the
            Agricultural Act of 1949 (as then in effect);
              (C) adding contract payments which are refunded
            during the preceding fiscal year under section 103(h)
            (of this Act) for the commodity; and
              (D) subtract an amount equal to the amount, if any,
            necessary during that fiscal year to satisfy payment
            requirements for the commodity under section 103B,
            105B, or 107B of the Agricultural Act of 1949 (as then
            in effect prior to the amendment made by section
            109(b)(2)) for the 1994 and 1995 crop years.
        Section 103(e), in paragraph (4), provides for an
    additional adjustment to the amounts allocated for each
    contract commodity in order to cover any final payments
    required under sections 101B of the Agricultural Act of 1949
    (as then in effect) for the 1994 and 1995 crop years. As soon
    as the Secretary determines these amounts, it will be deducted
    evenly from the amounts allocated for each contract commodity
    over the remaining fiscal year allocations.
        Section 103(f) provides the method for determining payments
    under a particular contract:
              Paragraph (1) establishes the process for determining
            the payment quantity of a contract commodity, which is
            the product of 85 percent of the contract acreage and
            the farm program payment yield for the commodity.
              Paragraph (2) provides that the payment quantity of
            each contract commodity covered by all contracts for
            each fiscal year shall equal the sum of all the payment
            quantities under paragraph (1).
              Paragraph (3) provides that the annual payment rate
            for a contract commodity shall be the amount made
            available under 103(e) for the commodity divided by the
            total payment quantity under paragraph (2).
              Paragraph (4) provides that the payment amount to be
            paid under a contract on a commodity shall be equal to
            the product of the payment quantity determined under
            paragraph (1) and the payment rate determined under
            paragraph (3).
              Paragraph (5) provides that the provisions of section
            8(g) of the Soil Conservation and Domestic Allotment
            Act relating to assignment of payments shall apply to
            contract payments under the subsection, and requires
            that the owner, operator, or assignee notify the
            Secretary of such assignment.
              Paragraph (6) directs the Secretary to allow for the
            sharing of payments among owners and operators in a
            fair and equitable manner.
        Section 103(g) provides that the total amount of payments
    under a contract during any fiscal year may not exceed the
    payment limitation established under sections 1001 through
    1001C of the Food Security Act of 1985.
        Section 103(h), in paragraph (1), authorizes the Secretary
    to terminate a contract if an owner or operator violates the
    farm's conservation compliance plan, wetland protection
    requirements, or planting flexibility provisions. Upon
    termination, the owner or operator forfeits future payments and
    must refund payment with interest as determined by the
    Secretary received on each farm in which the owner or operator
    contracted for payments during the period of the violation.
        Section 103(h), in paragraph (2), provides that, if the
    Secretary determines that the nature of the violation does not
    warrant termination of the contract as provided in paragraph
    (1), the Secretary may--
              (A) require a partial refund with interest for the
            period of the violation; or
              (B) adjust future contract payments proportionate to
            the severity of the violation.
        Section 103(h), in paragraph (3), prohibits the Secretary
    from requiring repayments from an owner or operator if farmland
    which is subject to the contract is foreclosed upon and the
    Secretary determines that forgiving such repayment is
    appropriate in order to provide fair and equitable treatment.
    This authority does not void the responsibilities of such owner
    or operator if the owner or operator continues or resumes
    control or operation of the property subject to the contract,
    and in effect resumes contract over the contract.
        Section 103(h), in paragraph (4), provides that a
    determination by the Secretary under this subsection shall be
    considered as an adverse decision for purposes of
    administrative review.
        Section 103(i), in paragraph (1), provides for rules for
    transfers of land subject to a contract. Upon a transfer, a
    contract is automatically terminated unless the transferee
    agrees to assume all obligations under the contract. A
    transferee may request modifications to a contract before
    assuming it, if the Secretary approves and the modifications
    are consistent with the objectives of this section as
    determined by the Secretary.
        Section 103(i), in paragraph (2), authorizes the Secretary
    to issue regulations regarding contract payments in instances
    in which an owner or operator dies, becomes incompetent, or is
    otherwise unable to receive a contract payment.
        Section 103(j) establishes planting flexibility provisions
    on land subject to a contract.
        Paragraph (1) provides that, subject to the limitations in
    paragraph (2), any commodity or crop may be planted on contract
    acreage.
        Paragraph (2), in subparagraph (A), provides that, with
    respect to contract acreage beyond 15 percent, haying and
    grazing shall be permitted except during any consecutive 5-
    month period designated by the State Committee established
    under section 8(b) of the Soil Conservation and Domestic
    Allotment Act between April 1 and October 31st of each year,
    unless waived by the Secretary because of a natural disaster.
    Contract acreage on which contract commodities are planted for
    harvest may be hayed or grazed at any time without limitation.
        Paragraph (2), in subparagraph (B), provides that alfalfa
    may be grown on contract acreage beyond 15 percent without any
    restriction, except that the quantity of acreage eligible for a
    contract payment shall be reduced proportionately for each acre
    beyond 15 percent.
        Paragraph (2), in subparagraph (C), provides that the
    planting of fruits and vegetables shall be prohibited on
    contract acreage, except in any region in which there is a
    history of double-cropping, as determined by the Secretary.
    This prohibition does not apply to lentils, mung beans, and dry
    peas.

    Section 104. Nonrecourse marketing assistance loans and loan deficiency
            payments

        Section 104(a), in paragraph (1), directs the Secretary to
    make nonrecourse marketing assistance loans available to
    eligible producers on a farm for loan commodities for each of
    the 1996 through 2002 crops of such commodities under terms and
    conditions prescribed by the Secretary at rates established
    under section 104(b).
        Section 104(a), in paragraph (2), provides that the amount
    of production eligible for a marketing assistance loan includes
    all production of a loan commodity produced by a producer who
    has entered into a contract, and any production of extra long
    staple cotton and oilseeds.
        Section 104(a), in paragraph (3), provides for recourse
    loans for high moisture corn and grain sorghum for the 1996
    through 2002 crops, available to producers who normally harvest
    all or a portion of their corn or grain sorghum in a high
    moisture state, provided that they present adequate
    documentation to the Secretary regarding the amount harvested.
        Section 104(b), in paragraph (1), provides that the loan
    rate for wheat is not less than 85 percent of the 5-year
    Olympic average, with a maximum of $2.58 per bushel, and the
    Secretary has authority to further decrease the loan rate in a
    particular year based on supply-use ratios.
        Section 104(b), in paragraph (2), provides that the loan
    rate for corn shall be not less than 85 percent of the 5-year
    Olympic average, with a maximum of $1.89 per bushel, and the
    Secretary has authority to further reduce the loan rate in a
    particular year based on supply-use ratios. Loan rates for
    other feed grains are to be set at rates which are fair and
    reasonable in relation to the rate for corn based on feeding
    value.
        Section 104(b), in paragraph (3), provides that the loan
    for upland cotton shall be not less than the lower of either:
              (i) 85 percent of the average U.S. spot market price
            during the preceding 5 marketing years, excluding the
            highest and lowest-price years, or
              (ii) 90 percent of the average price of the 5 lowest
            priced growths quoted for Northern Europe during a
            specified period, adjusted downward to account for
            differences between the Northern Europe and U.S. spot
            market prices.
    However, in any case, the loan rate shall not be less than
    $0.50 per pound nor more than $0.5192 per pound.
        Section 104(b), in paragraph (4), provides that the loan
    rate for extra long staple cotton shall be not less than 85
    percent of the 5-year Olympic average, with a maximum of
    $0.7965 per pound.
        Section 104(b), in paragraph (5), provides that the loan
    rate for rice shall be $6.50 per hundredweight.
        Section 104(b), in paragraph (6), provides that the loan
    rate for oilseeds: soybeans are $4.92 per bushel, sunflower
    seed, canola, rapeseed, safflower, mustard seed, and flaxseed
    are $0.087 per pound; and other oilseeds are set at a level
    that is fair and reasonable in relation to the loan rate
    available for soybeans other than cottonseed (not to be less
    the rate for soybeans on a per pound basis).
        Section 104(c) provides that the term of a loan shall be
    nine months, except that a loan for upland or extra long staple
    cotton be ten months, starting on the first day of the first
    month after the month in which the loan is made. The Secretary
    may not extend loans.
        Section 104(d) establishes repayment provisions for loan
    commodities.
        Paragraph (1) provides that, in general, the repayment rate
    for marketing assistance loan (other than extra long staple
    cotton) is the lesser of:
              (A) the loan rate; or
              (B) the prevailing world market price (adjusted to
            U.S. quality and location), as determined by the
            Secretary.
        Paragraph (2) provides that, with respect to wheat, feed
    grains, and oilseeds, the repayment rate shall be set by the
    Secretary at such level as will:
              (A) minimize potential loan forfeitures;
              (B) minimize the accumulation of stocks of the
            commodities by the Federal Government;
              (C) minimize the cost incurred by the Federal
            Government in storing the commodities; and
              (D) allow the commodities produced in the United
            States to be marketed freely and competitively, both
            domestically and internationally.
        Paragraph (3) sets the repayment rate for extra long staple
    cotton at the loan rate plus interest.
        Paragraph (4) instructs the Secretary to prescribe by
    regulation a formula to determine the prevailing world market
    price and a mechanism to periodically announce the prevailing
    world market price.
        Paragraph (5) provides upland cotton prevailing world
    market price adjustment authority based on the Northern Europe
    price differential, with further adjustment authority based on
    the U.S. export share, current cotton exports and sales, and
    other data determined by the Secretary to be relevant. Such
    adjustments may not exceed the difference between the average
    U.S. price and the northern Europe price.
        Section 104(e) directs the Secretary to make loan
    deficiency payments to producers who forego obtaining a loan
    under subsection (a) in an amount equal to the difference
    between the loan rate for a commodity and the level at which it
    may be repaid. However, there is no authority for loan
    deficiency payments for extra long staple cotton.
        Section 104(f) provides special marketing loan provisions
    for upland cotton.
        Paragraph (1) provides authority for cotton user marketing
    certificates (commonly referred to as ``Step 2''), under which
    certificates (which may be redeemed for CCC-owned commodities)
    or cash payments must be made available to first handlers of
    cotton whenever the prevailing market price (adjusted for U.S.
    quality and location) is below the current loan repayment rate.
    The values of the certificates (or the amount of the payment)
    is based on the difference between the adjusted world price and
    the loan repayment level. The Secretary is required to make
    payments, either in cash or marketing certificates, to domestic
    users and exporters for documented purchases whenever (i) the
    weekly U.S. Northern Europe price exceeds the Northern Europe
    price by more than 1.25 cents per pound for a consecutive four-
    week period; and (ii) the adjusted world market price does not
    exceed 130 percent of the loan rate. However, no payments will
    be issued if, for the preceding consecutive 10-week period, the
    weekly U.S. Northern Europe price, adjusted for the value of
    any certificates or payments issued, exceeds the Northern
    Europe price be more than 1.25 cents per pound. The value of
    the certificates (or the amount of the payments) is the
    difference between the two prices, minus 1.25 cents, per pound.
    Total expenditures for Step 2 payments are limited to
    $701,000,000 during fiscal years 1996 through 2002.
        Paragraph (2) extends special import quota provisions
    (commonly known as ``Step 3'') which requires that a special
    import quota be opened if, for a consecutive 10-week period,
    the U.S. Northern Europe price, adjusted for the value of any
    payments issued under Step 2, exceeds the Northern Europe Price
    by more than 1.25 cents per pound. The amount of the quota is
    equal to 1 week's domestic mill consumption. Importers have 90
    days to purchase and 180 days to enter the cotton into the U.S.
    after the quota is announced, and quota periods can overlap.
        Section 104(g) extends the limited global quota provisions,
    which direct the President to carry out an upland cotton import
    quota program whenever the Secretary determines and announces
    that the average price in designated U.S. spot markets for a
    month, as determined by the Secretary, exceeded 130 percent of
    such average price for the last 36 months. The quantity of this
    import quota is equal to 21 days of domestic mill consumption,
    but this quota cannot overlap with any quota announced under
    section 104(f).
        Section 104(h) provides general authority for the Secretary
    to use the Commodity Credit Corporation (``CCC'') and other
    means available to carry out the loans authorized by this
    section, and directs the Secretary to get adequate processor
    assurances that producers will get loan program benefits
    whenever a loan program includes payments to processors.
        Section 104(i) gives the Secretary general authority to
    make appropriate adjustments in loan levels based on grade,
    type, quality, location, and other factors.
        Section 104(j) provides that, in general, a producer is not
    personally liable for any deficiency rising from the sale of
    collateral securing a nonrecourse loan. However, exceptions are
    provided for quality or quantity deficiencies, failure to
    properly care or maintain collateral, or a failure to deliver a
    commodity. This section also provides that any security
    interest obtained by CCC in sugarcane or sugarbeets as a result
    of a security agreement by a processor shall be superior to all
    common law and statutory liens in favor of producers.
        Section 104(k) provides authority for CCC to sell any
    inventory commodities at any price that the Secretary
    determines will maximize returns to CCC, except that this
    authority does not apply to sales:
              (A) for new or byproduct uses;
              (B) of peanuts or oilseeds (if used for oil);
              (C) for seed if the sale will not impair a loan
            program;
              (D) of deteriorated-quality commodities that are in
            danger of spoiling;
              (E) for the purpose of establishing a claim arising
            out of a fraudulent or other wrongful act pursuant to a
            contract;
              (F) for export; or
              (G) for other than a primary use.
    The Secretary is also authorized to make CCC-owned commodities
    available in any Presidential disaster area.

    Section 105. Payment limitation

        Section 105(a) amends section 1001 of the Food Security Act
    of 1985 to provide that the total amount of contract payments
    to a person under section 103 of this Act may not exceed
    $40,000 during any fiscal year, and that the total annual
    amount of marketing loan gains or loan deficiency payments to a
    person for loan commodities under section 104 of this Act may
    not exceed $75,000.
        Section 105(b) makes necessary conforming changes to the
    Food Security Act of 1985.

    Section 106. Peanut program

        Section 106(a) provides nonrecourse loans to quota peanut
    producers at $610 per ton, and directs the Secretary to reduce
    the loan rate by 5 percent to any producer who had an offer
    from a handler to purchase quota peanuts, for delivery within
    the same county or a contiguous county, at a price equal to or
    greater than the applicable quota support rate, for the peanuts
    that were subject to the offer.
        Section 106(b) provides nonrecourse loans to producers of
    additional peanuts at such rates as the Secretary finds
    appropriate.
        Section 106(c) directs the Secretary to make price support
    loans available through area marketing associations via
    warehouse storage loans, where appropriate, and provides that
    administrative costs by an area marketing association shall be
    included in such loans. The Secretary is directed to require
    area marketing associations to establish and maintain pools for
    quota peanuts, with separate pools for New Mexico Valencia
    peanuts, and that net gains from each pool shall be distributed
    only to producers in the pool.
        Section 106(d) provides that losses in quota pools shall be
    covered using the following sources in the following order or
    priority:
              (1) gains on transfers of peanuts from additional
            loan pools;
              (2) gains from domestic and export edible use sales
            of additional peanuts from additional pools;
              (3) buy-back gains within the area;
              (4) marketing assessment funds collected from growers
            under subsection (g) (except funds attributable to
            handlers) with any unused assessment funds being
            transferred to the Treasury;
              (5) gains or profits from quota pools in other
            production areas (not including separate type pools
            established for Valencia peanuts produced in New
            Mexico) and then buy-back gains in other areas; and
              (6) an increase in the marketing assessment for such
            quota pool.
        Section 106(e) provides that the Secretary may not make
    loans available for quota peanuts for any crop of quota peanuts
    for which producers have disapproved the poundage quota.
        Section 106(f) directs the Secretary to continue to promote
    quality improvement of peanuts.
        Section 106(g) provides that first handlers (initial
    purchasers of peanuts) and producers pay a marketing assessment
    to CCC on all peanuts sold equal to 1.2 percent of the national
    average loan rate, with first handlers paying .60 percent in
    1996 and .65 percent in 1997 through 2002.
        Section 106(h) provides that subsections (a) through (f)
    are applicable to the 1996 through 2002 crops of peanuts.
        Section 106(i), in paragraph (1), amends the peanut quota
    provisions contained in part VI of subtitle B of title III of
    the Agricultural Adjustment Act of 1938 (the ``1938 Act'') by
    extending such provisions through the 2002 marketing year.
        Section 106(i), in paragraph (2), amends section 358-
    1(b)(1) and 358-1(b)(2) of the 1983 Act to provide eligibility
    provisions for farm poundage quota. Beginning with the 1997
    marketing year, farms: (i) owned or controlled by
    municipalities, airport authorities, schools, colleges,
    refuges, and other public entities; or (2) owned or controlled
    by a person who is not a producer and resides in another State;
    will no longer be allocated any farm poundage quota by the
    Secretary, and any farm poundage quota held by such entities at
    the end of the 1996 marketing year shall be allocated to other
    farms in a State.
        Section 106(i), in paragraph (3), amends section 358-
    1(a)(1) of the 1938 Act by eliminating the 1,350,000 ton
    minimum national poundage quota.
        Section 106(i), in paragraph (4), amends section 358-
    1(b)(2) of the 1938 Act by deleting the current subparagraph
    (B) relating to allocation of increased quota in Texas and
    inserting a new subparagraph (B) authorizing temporary
    increases in quota based on seed use. Amended section 358-
    1(b)(2), in subparagraph (B), provides that, for the 1996
    through 2002 marketing years, a temporary quota allocation for
    the marketing year only in which the crop is planted, equal to
    the number of pounds of seed peanuts planted for the farm that
    shall be made to the producers for the 1996 through 2002
    marketing years, in addition to the normal farm poundage quota
    established under section 358-1. Subparagraph (B) also provides
    that there is no change in the requirement regarding the use of
    quota and additional peanuts established by section 359a(b) of
    the 1938 Act. Also, subsection (a)(1) of such section no longer
    includes ``seed'' in the estimate of domestic edible use by the
    Secretary.
        Section 106(i), in paragraph (5), amends section 358b(a)(1)
    of the 1938 Act relating to farm poundage quota transfer.
    Amended section 358b(a)(1) allows farm poundage quota to be
    sold or leased, either before or after the normal planting
    season, to any other owner or operator of a farm in the same
    State. Current provisions requiring 90 percent of a farm's
    basic quota to be planted or considered planted before a fall
    (or after the normal planting season) transfer is allowed are
    maintained.
        Section 106(i), in paragraph (6), eliminated
    undermarketings by deleting paragraphs (8) and (9) of section
    358-1(b) of the 1938 Act, with necessary conforming changes to
    other sections.
        Section 106(i), in paragraph (7), adds a new paragraph (8)
    to amended section 358-1(b) of the 1938 Act which authorizes
    the transfer of additional peanuts from a farm to a quota loan
    pool in cases in which quota poundage was not harvested and
    marketed because of drought, flood, or any other natural
    disaster, except that the such peanuts shall be supported at 70
    percent of the quota support rate, and such transfer shall not
    exceed 25 percent of the total farm quota pounds.

    Section 107. Sugar program

        Section 107(a) sets the loan rate for domestically grown
    sugarcane at 18 cents per pound for raw cane sugar.
        Section 107(b) sets the loan rate for domestically grown
    sugar beets at 22.9 cents per pound for refined beet sugar.
        Section 107(c) requires the Secretary to reduce the loan
    rate specified in subsections (a) and (b) if the Secretary
    determines that negotiated reductions in export subsidies
    provided for sugar of the European Union and other major sugar
    exporting countries in the aggregate exceed the commitments
    made as part of the Agreement on Agriculture. It also provides
    that the Secretary shall not reduce the loan rate under
    subsections (a) and (b) below a rate that provides domestic
    sugar an equal measure of support to that provided by the
    European, Union and other sugar exporting countries based on
    the provisions of Agreement on Agriculture, section 101(d)(2)
    of the Uruguay Round Agreements Act.
        Section 107(d) provides that loan terms are the earlier of
    9 months, or the end of a fiscal year, with supplemental loan
    authority (up to a total on nine months) for loans maturing at
    the end of a fiscal year.
        Section 107(e) provides for the Secretary to carry out the
    section through the use of recourse loans for sugar. However,
    it also provides that during any fiscal year in which the
    tariff rate quota (TRQ) for imports of sugar into the U.S. is
    set, or increased to, a level that exceeds 1,500,000 short tons
    raw value, the Secretary is directed to carry out this section
    by marking nonrecourse loans (previously made recourse loans
    are to be modified by the Secretary into nonrecourse loans). If
    the Secretary is required to make nonrecourse loans (or modify
    recourse loans) under this subsection during a fiscal year, the
    Secretary is to obtain from processors adequate assurances that
    such processors will provide appropriate minimum payments to
    producers as set by the Secretary.
        Section 107(f) requires first processors of raw cane sugar
    to remit to CCC nonrefundable marketing assessment for each
    pound of raw cane sugar equal to 1.1 percent of the loan rate
    for fiscal year 1996 (1.375 percent for 1997 through 2003)
    while first processors of sugar beets are to remit to CCC a
    marketing assessment of 1.1794 percent for fiscal year 1996
    (1.47425 percent for 1997 through 2003), on all marketings.
    Assessments are to be collected on a monthly basis, except that
    any inventory which has not been marketed by September 30 of a
    fiscal year shall be assessed at that point, except that the
    latter sugar shall not be assessed later when it is marketed.
    Any person who fails to remit the assessment is liable for a
    penalty based on the quantity of the sugar involved in the
    violation times the applicable loan rate at the time of
    violation.
        Section 107(g) provides for an additional penalty (1 cent
    per pound on cane sugar, pro rata on beet sugar) to be assessed
    on the forfeiture of any sugar pledged as collateral for a
    loan.
        Section 107(h) requires processors and refiners to report
    such information to the Secretary as is required in order to
    administer the program. A penalty applies for failure to report
    and the Secretary is required to make monthly reports on
    pertinent sugar production, imports, distribution, and stock
    levels.
        Section 107(i) repeals marketing allotments for sugar,
    contained in Part VII of subtitle B of title III of the 1938
    Act.
        Section 107(j) provides that this section is applicable to
    the 1996 through 2002 crops of sugar beets and sugarcane.

    Section 108. Administration

        Section 108 directs the Secretary to use CCC to carry out
    this title, and prohibits the Secretary from using any CCC
    funds for the salaries or expenses of any officer or employee
    of USDA. It also provides authority to issue necessary
    regulations, and provides that determinations made by the
    Secretary under this title are final.

    Section 109. Elimination of permanent price support authority

        Section 109 repeals the Agricultural Act of 1949 (certain
    necessary sections are transferred to the 1938 Act), and makes
    required conforming amendments.

    Section 110.--Effect of amendments

        Section 110 provides that the amendments made by this Act
    shall not affect the authority of the Secretary to carry out
    the 1991 through 1995 production adjustment programs in effect
    before this Act.

                                title ii--dairy

    Section 201.--Milk Price Support Program

        Section 201 continues the current authority of the
    Secretary of Agriculture to support the price of milk produced
    in the 48 contiguous states through the purchase of excess
    cheddar cheese from the commercial market through December 31,
    2002. However, beginning on the first day of the first month
    not less than 30 days after the enactment of this Act, the
    Secretary will no longer be authorized to support the price of
    milk through the price of milk through the purchase of excess
    butter and nonfat dry milk from the commercial market.
        It also establishes the support price for a hundredweight
    (cwt) of milk containing 3.67 percent butterfat at not less
    than $10.35 during calendar year 1996, not less than $10.25
    during calendar year 1997, not less than $10.15 during calendar
    year 1998, not less than $10.05 during calendar year 1999, not
    less than $9.95 during calendar year 2000, and not less than
    $9.85 during calendar year 2001 and thereafter.
        Section 201 does not provide authority for the Secretary to
    assess producers to pay for any portion of the support program
    for milk (the current budget assessment is repealed with the
    rest of Section 204 of the Agricultural Act of 1949 by section
    109(b)(2)). However, the Secretary is authorized to refund the
    budget assessments collected from a dairy producer in calendar
    year 1995 or calendar year 1996 if that producer can establish
    that he or she did not increase marketings of milk in that
    calendar year when compared to the preceding calendar year.
        The authority of the Secretary to transfer milk products
    purchased under the support program to the military and
    veterans hospitals is continued. However, the CCC is to be
    reimbursed for all costs associated in making those products
    available to the military and veterans hospitals.

    Section 202.--Recourse loans for commercial processors of dairy
            products.

        Section 202 authorizes the Secretary to make recourse loans
    available to commercial processors of cheddar cheese, butter
    and nonfat dry milk dairy products to assist those processors
    in assuring price stability for the dairy industry. Loans are
    to be made available at 90% of the market price and at
    established CCC interest rates. Loans may not extend beyond the
    end of the fiscal year in which they are made, except that the
    Secretary may extend a loan for an additional period not to
    exceed the next fiscal year.

    Section 203.--Dairy export incentive program

        Section 203 extends the Dairy Export Incentive Program
    (DEIP) through December 31, 2002. The Secretary is directed to
    use DEIP at the maximum volume and funding levels permitted by
    the Uruguay Round. The Secretary is given sole discretion over
    DEIP and authorized to take market development into
    consideration, in addition to the difference between domestic
    and world prices, in establishing payment rates under DEIP.
        In making these changes, it is the intent of the Committee
    that the DEIP program be run in the most efficient and cost-
    effective manner possible. USDA should, therefore, take all
    appropriate steps to implement these amendments by issuing or
    revising its DEIP regulations as soon as practicable. The
    Committee would further note that the recent ``start and stop''
    approach to operating DEIP has undermined its effectiveness
    and, as a result, the Committee strongly encourages USDA to
    have any other program revisions along with the amendments made
    by this Act fully implemented by July 1, 1996.

    Section 204.--Dairy promotion program

        Section 204 extends the research and promotion assessment
    (15 cents/hundredweight) under the Dairy Production
    Stabilization Act of 1983 to dairy components, derivatives, and
    products imported into the United States, including casein
    (except casein imported under sections 3501.90.20 [casein glue]
    and 3501.90.50 [other] of the harmonized Tariff Schedule, at
    the rate of 1.2 cents per pound of total milk solids in those
    products. The National Dairy Promotion and Research Board is
    expanded from 36 to 38 members to include an importer of dairy
    products into and an exporter of dairy products from the United
    States.
        The Dairy Production Stabilization Act of 1983 is amended
    to require that the budget of the National Dairy Promotion and
    Research Board during each of the fiscal years from 1996 and
    2000 shall provide for the expenditure of not less than 10
    percent of anticipated revenues available to the Board on the
    development of international markets for, and the promotion
    within such markets of, U.S. dairy products.
        The Secretary shall publish a proposed order reflecting
    these amendments to the Dairy Production Stabilization Act
    within 60 days of enactment and provide notice and an
    opportunity for comment. After consideration of any comments
    received on the proposed order, a final order shall be issued
    and become effective not later than 120 days after publication
    of the proposed order. Within 36 months after the issuance of a
    final order, the Secretary shall conduct a referendum for the
    sole purpose of determining whether the requirement of the
    amendments will be continued. The amendments will be continued
    if approved by a majority of those persons voting in the
    referendum. If the amendments are not approved, the old order
    shall be reinstated.

    Section 205.--Fluid milk standards under milk marketing orders

        Section 205 establishes minimum standards for fluid milk
    within Federal milk marketing orders as follows: for whole
    milk--not less than 8.8 percent milk solids not fat and not
    less than 3.25 percent milk fat; for 2 percent (lowfat) milk--
    not less than 10 percent solids not fat and not less than 2
    percent milk fat; for 1 percent (light) milk--not less than 11
    percent milk solids not fat and not less than 1 percent milk
    fat; and for skim (nonfat) milk--not less than 9 percent milk
    solids and not more than .25 percent milk fat.
        The quality standards established by Section 205 for
    Federal milk marketing orders are equivalent to those currently
    in existence in California. By adopting these standards in all
    Federal milk marketing orders, the committee expects that the
    California state standards will remain in effect as well during
    the two-year period following the enactment of this Act.

    Section 206.--Manufacturing allowance

        Section 206 sets the maximum manufacturing allowance
    (``make allowance'') which a state may provide for milk
    manufactured into butter, butter oil, nonfat dry milk, and
    whole dry milk at $1.65/hundredweight of milk, and for milk
    manufactured into cheese and whey of $1.80/hundredweight of
    milk during the two-year period beginning on the effective date
    of this section. Subsequent to that two-year period, the
    manufacturing allowance will be that amount determined by the
    Secretary under authority granted to the Secretary in section
    221(b)(3).
        Any state which provides for a higher make allowance for
    cheese than that provided by this section may not sell surplus
    cheese to the Commodity Credit Corporation (CCC) under the
    price support program. Any state which provides for a higher
    make allowance for butter and nonfat dry milk than that
    provided by this section may not receive disbursements from the
    Class IV equalization pool under section 208.
        Section 206 also suspends Section 102 of the 1990 Farm bill
    during the two-year transition period unless an injunction or
    other court order prohibits or impairs the implementation of
    this section of the Act. Section 102 is then repealed at the
    end of the two-year transition period.
        The Secretary is authorized to implement and enforce this
    section without the issuance of regulations. Section 206 is
    effective on the first day of the first month beginning not
    less than 30 days after the date of the enactment of this Act.
        In adopting section 206, the Committee intends only to
    establish a yardstick which the Secretary can use in
    determining whether a state may participate in the Class IV
    equalization pool or sell cheese to the CCC. It is not the
    Committee's intent to dictate changes in a state's pricing
    formula, but rather to bring about some measure of uniformity
    in the effective make allowances of processors under Federal
    orders and those subject to state orders using the yields and
    prices specified in section 206.
        Therefore, in the case of the State of California, it is
    the intent of the Committee that the $1.80/hundredweight and
    the $1.65/hundredweight make allowances set during the two-year
    transition period by section 206 have the effect of lowering
    California's manufacturing allowances for cheese, butter, and
    nonfat dry milk by $.15/hundredweight, notwithstanding other
    adjustments made by the pricing formulas in the California
    order from their current levels. However, nothing in this
    section prevents the State of California from altering its own
    formulas in a way that would decrease its state make allowances
    for cheese, butter, and nonfat dry milk by more than $.15/
    hundredweight.

    Section 207. Establishment of temporary Class I price and temporary
            Class I equalization pool

        Section 207 makes temporary changes in the pricing and
    pooling of milk of the highest use classification (i.e., Class
    I or ``fluid'' milk) for a period of two years beginning on the
    first day of the first month not less than 30 days after
    enactment of the Act.
        During this two-year ``transition'' period, this section
    creates a price floor for milk of the highest use
    classification (Class I milk) in a Federal milk marketing order
    of not less than $12.87/hundredweight plus the Class I
    differential in effect for that order on December 31, 1995. In
    the event that the Basic Formula Price exceeds $12.87/
    hundredweight in any month during that two-year period of time,
    the difference between the Basic Formula Price and $12.87 shall
    be added to the Class I price in every Federal milk marketing
    order in the second month following the month in which that
    difference occurred.
        The section also creates a Class I equalization pool during
    this two-year period to more equitably share fluid milk
    revenues nationwide. Every month during the two-year period,
    each Federal milk marketing order and the California state
    order must pay into the pool an amount equal to $.80/
    hundredweight times the number of hundredweight of Class I milk
    marketing in that order during the month. Similarly, every
    month during the two-year period, each of these orders will
    receive back from the Class I equalization pool an amount equal
    to the total monthly receipts in the pool times the ratio of
    the total milk marketed in that order during the month to the
    total milk marketed in all of those orders during the month.
        The amendments required by Section 207 are not subject to a
    producer referendum, to the rulemaking requirements of title 5
    of the U.S. Code, or to the review or approval of other
    executive agencies.

    Section 208. Establishment of a temporary Class IV price and a
            temporary Class IV equalization pool

        Section 208 makes temporary changes in the pricing and
    pooling of milk used to produce butter, butter oil, nonfat dry
    milk, and whole dry milk for a period of two years beginning on
    the first day of the first month not less than 30 days after
    enactment of the Act.
        During this two-year ``transition'' period, this section
    establishes a ``Class IV'' price for milk used to manufacture
    these products. The section also creates a Class IV
    equalization pool the two-year ``transition'' period that is
    activated any month in which the Class IV price determined by
    the Secretary is less than the support price for milk used to
    manufacture cheese under section 201 (adjusted to 3.5 percent
    butterfat).
        The Class IV pool is intended to create a more equitable
    sharing of any difference between the support price for milk
    used in cheese and the Class IV price for milk among all
    producers. In any month where the support price (adjusted to
    3.5 percent butterfat) exceeds the Class IV price determined by
    the Secretary, the Class IV equalization pool will collect from
    each milk marketing order (Federal and state) or handler (in
    the case of unregulated milk) its proportionate share (the
    ratio of the total milk marketed under that order or by handler
    to the total milk marketed under all orders and by all handlers
    during that month) of 50 percent of that difference times the
    total Class IV milk marketed during that month. The Class IV
    pool will, then, disburse to an order or handler which marketed
    Class IV milk during that month its proportionate share of
    total collections (the ratio of Class IV milk marketed under
    that order or by that handler to the total Class IV milk
    marketed under all orders and by all handlers during that
    month).
        The amendments required by Section 208 are not subject to a
    producer referendum, to the rulemaking requirements of title 5
    of the U.S. Code, or to the review or approval of other
    executive agencies.

    Section 209. Authority for establishment of standby pools

        Section 209 authorizes the Secretary to invite proposals
    for the establishment of standby pools to facilitate the
    movement of milk over long distances. Participation in standby
    pools must be approved order-by-order as a separate order item.

    Section 221. Issuance or amendment of Federal milk marketing orders to
            implement certain reforms

        Section 221 requires the Secretary to issue new or amended
    milk marketing orders, which shall supersede any other
    statutes, rules or regulations applicable to the pricing and
    marketing of milk and its products. The new or amended orders
    will accomplish the following reforms: (1) consolidation of
    existing Federal orders and other areas within the 48
    contiguous states not covered by Federal orders into not more
    than 8 to 13 orders, with the State of California as one of
    those orders and with each order authorized to blend order
    proceeds as necessary to address issues unique to that order
    such as pre-existing state quota programs; (2) implementation
    of uniform multiple component pricing for milk used in
    manufactured dairy products; and (3) establishing class prices
    for milk used to produce cheese, nonfat dry milk, and butter
    based on national product prices less a manufacturing allowance
    (which shall not vary regionally except to reflect variances in
    transportation and reasonable operating costs, if any, of
    efficient processing plants in different geographical areas).
    The section further provides that these changes are not to
    affect the current status of producer handlers.
        When the Secretary utilizes the authority granted under
    this section to reform and consolidate Federal milk marketing
    orders, the Committee expects that the Secretary will
    accomplish that task with a goal of maximizing dairy producer
    net income.
        With respect to the blending of pool proceeds in a new or
    amended order which encompasses the entire geographic area of a
    single state and no other area, it is the intent of the
    Committee that the Secretary may use a milk pooling system
    within that State in lieu of Federal authorities to blend pool
    proceeds and manage any quota payment differential plan in
    operation in that State.
        In implementing a program of multiple component pricing,
    the Secretary should apportion the total value of milk paid to
    producers based upon the milk's composition of butterfat,
    protein, and other solids.
        The Committee also notes that the Secretary already has the
    authority to implement multiple component pricing on any class
    of milk in any Federal milk marketing order pursuant to section
    112 of the Food, Agriculture, Conservation, and Trade Act of
    1990. Section 221(b) simply requires that the new or amended
    orders created by this section will include uniform multiple
    component pricing for milk used in manufactured dairy products.
    The Committee expects the Secretary to similarly include
    multiple component pricing for milk used in fluid milk products
    when requested to do so, and following approval, by producers
    in any Federal milk marketing order.
        Section 221(b) also requires the Secretary to establish
    class prices for milk based on national product prices less a
    manufacturing allowance. When establishing whether reasonable
    operating costs vary between efficient processing plants in
    different geographic regions, it is expected that the Secretary
    will audit, using uniform procedures, a significant
    representative sample of such plants in each region.

    Section 222. Reform process

        Section 222 provides an expedited process for the issuance
    of new or amended orders under section 221: (1) the Secretary
    has a limit of not more than 165 days after enactment to
    propose amendments or new orders; (2) a comment period of not
    more than 75 days is established for the proposed amendments or
    new orders; and (3) the Secretary has not more than 120 days
    after the close of the comment period to publish a final
    administrative decision.
        The section provides for a referendum in each new or
    amended order as soon as the Secretary's decision is
    implemented to determine whether the producers wish to
    terminate the order. Actions taken by the Secretary under
    sections 221 and 222 are not subject to the rulemaking
    requirements of title 5 of the U.S. Code and are not subject to
    review or approval by any other executive agency.

    Section 223. Effect of failure to comply with reform process
            requirements

        Section 223 provides that, in the event that the Secretary
    does not publish a final administrative decision reforming
    Federal milk marketing orders within one year of the date of
    enactment of the Act, the Secretary's authority to assess
    producers and handlers for order administration and services is
    terminated. However, those services must continue and be
    financed out of funds available to the Agricultural Marketing
    Service.
        The section further provides that, unless the Secretary
    certifies to Congress within two years of the date of enactment
    of the Act that all of the Federal milk marketing order reforms
    required by section 221 are fully implemented, all Federal
    price support activity, milk marketing orders, Dairy Export
    Incentive Program activities, and promotion activities under
    both the producer and fluid processor promotion programs will
    cease immediately.
        In the event that the Secretary is enjoined or otherwise
    restrained by a court order from publishing or implementing the
    reform requirements specified by section 221, the length of
    time for which that injunction or other restraining order is
    effective shall be added to the time limitations specified in
    subsections (a) and (b) thereby extending those time
    limitations by a period of time equal to the period of time for
    which the injunction or other restraining order is effective.

                            title III--conservation

    Section 301. Conservation

        Section 301(a) amends Subtitle E of title XII of the Food
    Security Act of 1985 to provide mandatory funding for the
    fiscal years 1996 through 2002 for the Conservation Reserve
    Program, the Wetlands Reserve Program, and $100,000,000 per
    year for the Livestock Environmental Assistance Program created
    by this title.
        Section 301(b) amends Subtitle D of title XII of the Food
    Security Act of 1985 by adding a new Chapter 4, which creates
    the Livestock Environmental Assistance Program.
        Authorized through 2002, LEAP is authorized to provide
    technical assistance and cost-share and incentive payments to
    livestock producers who undertake land management or structural
    practices, funded through direct spending of $100,000,000 each
    fiscal year, with directions to the Secretary in how to develop
    priority areas with respect to spending. The Secretary is
    authorized to enter into contracts (up to ten years) to carry
    out this program. Operators of large confined livestock
    operations are ineligible to receive cost-share assistance for
    animal waste management facilities.
        Section 301(c), in paragraph (1), replaces permanent
    easement authority in the Wetlands Reserve Program with 15-year
    easement authority by amending section 1237 of the Food
    Security Act of 1985.
        Section 301(c), in paragraph (2), modifies the Conservation
    Reserve Program (section 1235 of the Food Security Act of 1985)
    by limiting total acreage enrollment to 36,400,000 acres.

              title iv--agricultural promotion and export programs

    Section 401.--Market Promotion Program

        Section 401 authorizes $100,000,000 annually for fiscal
    years 1996 through 2002 for the Market Promotion Program
    authorized by the Agricultural Trade Act of 1978.

    Section 402. Export Enhancement Program

        Section 402 amends the section 301(e)(1) of the
    Agricultural Trade Act of 1978 to limit the amount of the CCC
    funds available for the Export Enhancement Program as follows:
    $350,000,000 for fiscal years 1996 and 1997; $500,000,000 for
    fiscal year 1998; $550,000,000 for fiscal year 1999;
    $579,000,000 for fiscal year 2000; and $478,000,000 for fiscal
    years 2001 and 2002.

                             title v--miscellaneous

    Section 501. Crop insurance

        Section 501(a) amends section 508(b)(4) of the Federal Crop
    Insurance Act to provide that the Secretary may only continue
    to offer catastrophic risk protection through local USDA
    offices if the Secretary determines that the number of approved
    insurance providers operating in a State is insufficient to
    adequately provide catastrophic risk protection coverage to
    producers. If coverage availability in a State is adequate,
    only approved insurance providers may provide coverage. This
    section also provides that, effective with spring-planted 1996
    and subsequent crops, catastrophic coverage is not required for
    federal farm program benefits of producers sign a written
    waiver with the Secretary that waives any eligibility for
    emergency crop loss assistance.
        Section 501(b) amends section 519(a)(2)(B) of the Federal
    Crop Insurance Act to specify that seed crops are eligible for
    coverage.

    Section 502. Collection and use of agricultural quarantine and
            inspection fees

        Section 502 amends the agricultural quarantine and
    inspection fees provisions in section 2509 of the Food,
    Agriculture, Conservation, and Trade Act of 1990 to provide
    that, for the fiscal years 1996 through 2002, funds in the user
    fee account in excess of appropriated amounts shall be
    available until expended. Beginning with fiscal year 2003,
    funds in the user fee account shall be available without fiscal
    year limitation.

    Section 503. Commodity Credit Corporation interest rate

        Section 503 provides that the interest rate charged by CCC
    on loans for agricultural commodities shall be 100 basis points
    greater than rate established by the formula in effect on
    October 1, 1995.

    Section 504. Establishment of the Office of Risk Management

        Section 504 amends the Department of Agriculture
    Reorganization Act of 1994 by inserting after section 226 a new
    section 226A.
        New section 226A(a) directs the Secretary to establish and
    maintain an independent Office of Risk Management within the
    Department.
        New section 226A(b) provides that such office shall have
    jurisdiction over:
              (1) the supervision of FCIC;
              (2) administration and oversight of all programs
            authorized by the Federal Crop Insurance Act;
              (3) any pilot or other programs involving revenue
            insurance, risk management, or the use of the futures
            market to manage risk and support farm income; and
              (4) such other functions as the Secretary considers
            appropriate.
        New section 226A(c) provides that the office shall be
    headed by an Administrator who shall be appointed by the
    Secretary, and that the Administrator shall also serve as the
    Manager of FCIC.
        New section 226A(d), in paragraph (1), authorizes the Under
    Secretary of Agriculture for Farm and Foreign Agricultural
    Services to consolidate the human resources, public affairs,
    and legislative affairs functions of the Office of Risk
    Management.
        New section 226A(d), in paragraph (2), directs the
    Secretary to provide resources to the Office of Risk Management
    sufficient to enable the Office to carry out its functions in a
    timely and efficient manner.
        New section 226A(d), in paragraph (3), provides that fiscal
    year 1996 funding is established at not less than $88,500,000,
    to be taken from the appropriation for the salaries and
    expenses of the Consolidated Farm Services Agency.

    Section 505. Business Interruption Insurance Program

                Subsection (a). Establishment of program
        Subsection (a) directs the Secretary to establish a
    business interruption insurance program that allows a producer
    of a program crop to obtain revenue insurance coverage in case
    of loss of revenue. The Secretary is authorized to determine
    the nature and extent of such a program.
                Subsection (b). Report on progress and proposed expansion
        Subsection (b) provides that the Secretary must submit data
    to the Commission on 21st Century Production Agriculture
    established under Subtitle E by January 1, 1998, regarding the
    results of the program and make recommendations about how to
    best offer a revenue insurance program in the future.
                Subsection (c). Contract commodity defined
        Subsection (c) defines program crop to mean wheat, corn,
    grain sorghums, oats, barley, upland cotton, or rice.

    Section 506. Continuation of Options Pilot Program

        Section 506 provides that, during the 1996 through 2002
    crop years, the Secretary may continue to conduct the options
    pilot program authorized by the Options Pilot Program Act of
    1990 (Subtitle E of title XI of Public Law 101--624), with the
    Secretary having authority to make such modifications to the
    terms and conditions of the program as are necessary to reflect
    the changes to law made by this Act.

          title vi--commission on 21st century production agriculture

    Section 601. Establishment

        This section establishes a commission to be known as the
    ``Commission on 21st Century Production Agriculture.''

    Section 602. Composition

                Subsection (a). Membership and appointment
        Subsection (a) of this section requires that the Commission
    be composed of eleven members: three members appointed by the
    President; four members appointed by the Chairman of the
    Committee on Agriculture of the House of Representatives (in
    consultation with the ranking minority member); and four
    members appointed by the Chairman of the Committee on
    Agriculture, Nutrition, and Forestry of the Senate (in
    consultation with the ranking minority member).
                Subsection (b). Qualifications
        Subsection (b) establishes the qualifications required of
    the persons appointed to the Commission. At least one member
    appointed by each the President, the Chairman of the Committee
    on Agriculture of the House of Representatives, and the
    Chairman of the Committee on Agriculture, Nutrition, and
    Forestry of the Senate shall be an individual who is primarily
    involved in production agriculture. All other members appointed
    to the Commission must have knowledge and experience in
    agriculture production, marketing, finance, or trade.
                Subsection (c). Term of members; vacancies
        Subsection (c) requires that the appointment to the
    Commission be for the life of the Commission. It also directs
    that a vacancy on the Commission shall not affect the
    Commission's power and shall be filled in the same manner as
    the original appointment.
                Subsection (d). Time for appointment; first meeting
        Subsection (d) requires that the members of the Commission
    be appointed no later than October 1, 1997 and that the
    Commission convene its first meeting 30 days after six members
    of the Commission have been appointed.
                Subsection (e). Chairman
        Subsection (e) requires that the chairman of the Commission
    be designated jointly by the Chairman of the Committee on
    Agriculture of the House of Representatives and the Chairman of
    the Committee on Agriculture, Nutrition, and Forestry of the
    Senate from among the members of the Commission.

    Section 603. Comprehensive review of past and future of production
            agriculture

                Subsection (a). Initial review
        Subsection (a) of this section requires the Commission to
    conduct a comprehensive review of changes in the condition of
    production agriculture in the United States subsequent to the
    date of enactment of this Act and the extent to which such
    changes are the result of the changes made by this Act. This
    review shall include: (1) the assessment of the initial success
    of market transition contracts in supporting the economic
    viability of farming in the United States: (2) the assessment
    of the food security situation in the United States in the
    areas of trade, consumer prices, international competitiveness
    of United States production agriculture, food supplies, and
    humanitarian relief; (3) an assessment of the changes in farm
    land values and agricultural producer incomes; (4) an
    assessment of the regulatory relief for agricultural producers
    that has been enacted and implemented, including the
    application of cost/benefit principles in the issuance of
    agricultural regulations; (5) an assessment of the tax relief
    for agricultural producers that has been enacted in the form of
    capital gains tax reductions, estate tax exemptions, and
    mechanisms to average tax loads over high and low-income years;
    (6) an assessment of the effect of any Government interference
    in agricultural export markets, such as the imposition of trade
    embargoes, and the degree of implementation and success of
    international trade agreements; and (7) the assessment of the
    likely effect of the sale, lease, or transfer of farm poundage
    quota for peanuts across State lines.
                Subsection (b). Subsequent review
        Subsection (b) requires the Commission to conduct a
    comprehensive review of the future of production agriculture in
    the United States and the appropriate role of the Federal
    Government in support of production agriculture. This review
    shall include: (1) an assessment of changes in the condition of
    production agriculture in the United States since the initial
    review under subsection (a); (2) an identification of the
    appropriate future relationship of the Federal Government with
    production agriculture after 2002; and (3) an assessment of the
    manpower and infrastructure requirements of the Department of
    Agriculture necessary to support the future relationship of the
    Federal Government with production agriculture.
                Subsection (c). Recommendations
        Subsection (c) requires that the Commission develop
    specific recommendations for legislation to achieve the
    appropriate future relationship of the Federal Government with
    production agriculture identified under subsection (a)(2).

    Section 604. Reports

                Subsection (a). Report on initial review
        Subsection (a) of this section requires that by June 1,
    1998, the Commission submit a report containing the results of
    the initial review to the President, the Committee on
    Agriculture of the House of Representatives, and the Committee
    on Agriculture, Nutrition, and Forestry of the Senate.
                Subsection (b). Report on subsequent review
        Subsection (b) requires that not later than January 1,
    2001, the Commission submit a report containing the results of
    the subsequent review conducted under section 1503(b) to the
    President, the Committee on Agriculture of the House of
    Representatives, and the Committee on Agriculture, Nutrition,
    and Forestry of the Senate.

    Seciton 605. Powers

                Subsection (a). Hearings
        Subsection (a) of this section authorizes the Commission to
    conduct hearings, take testimony, receive evidence, and act in
    a manner the Commission considers appropriate to carry out the
    purposes of this Act.
                Subsection (b). Assistance from other agencies
        Subsection (b) authorizes the Commission to secure directly
    from any department or agency of the Federal Government any
    information necessary to carry out its duties under this title.
    The head of such department or agency shall furnish information
    requested by the chairman of the Commission, to the extent
    permitted by law.
                Subsection (c). Mail
        Subsection (c) authorizes the Commission to use the United
    States mails in the same manner and under the same conditions
    as the departments and agencies of the Federal Government.
                Subsection (d). Assistance from Secretary
        Subsection (d) requires that the Secretary of Agriculture
    shall provide appropriate office space and reasonable
    administrative and support services available to the
    Commission.

    Section 606. Commission procedures

                Subsection (a). Meetings
        Subsection (a) of this section requires that the Commission
    meet on a regular basis. The frequency of such meeting shall be
    determined by the chairman or a majority of its members.
    Additionally, the Commission must meet upon the call of the
    chairman or a majority of the members.
                Subsection (b). Quorum
        Subsection (b) provides that a majority of the members of
    the Commission must be present to produce a quorum for
    transacting the business of the Commission.

    Section 607. Personnel matters

                Subsection (a). Compensation
        Subsection (a) of this section provides that members of the
    Commission serve without compensation, but are allowed travel
    expenses when engaged in the performance of Commission duties,
    including a per diem in lieu of subsistence, as authorized by
    section 5703 of title 5, United States Code.
                Subsection (b). Staff
        Subsection (b) provides that the Commission shall appoint a
    staff director. The staff director's basic rate of pay shall
    not exceed that rate provided for under section 5376 of title
    5, United States Code. The Commission may appoint such
    professional and clerical personnel as may be reasonable and
    necessary to enable the Commission to carry out its duties
    without regard to the provisions governing appointments in the
    competitive service, title 5, United States Code, and
    provisions relating to the number, classification, and General
    Schedule rates in chapter 51 and subchapter III of chapter 53
    of title 5 or any other provision of law. No employee appointed
    by the Commission (other than the staff director) may be
    compensated at a rate exceeding the maximum rate applicable to
    level 15 of the General Schedule.
                Subsection (c). Detailed personnel
        Subsection (c) authorizes the head of any department or
    agency of the Federal Government to detail, without
    reimbursement, any personnel of such department or agency to
    the Commission to assist the Commission in carrying out its
    duties. The detail of any such personnel may not result in the
    interruption or loss of civil service status or privilege of
    such personnel.

    Section 608. Termination of Commission

        This section provides that the Commission shall terminate
    upon the issuance of its final report required by section 1504.

                  title vii--extension of certain authorities

    Section 701. Extension of authority under Public Law 480

        This section amends section 408 of the Agricultural Trade
    and Development Assistance Act of 1954 to extend the authority
    to enter into agreements through calendar year 1996.

    Section 702. Extension of Food for Progress

        This section amends section 1110 of the Food Security Act
    of 1985 to extend the Food For Progress Program through
    calendar year 1996 and to extend additional assistance in the
    administration of food assistance programs through fiscal year
    1996.

                            Committee Consideration

        The Committee on Agriculture met, pursuant to notice, on
    January 30, 1996, a quorum being present, to consider the bill
    H.R. 2854, the ``Agricultural Market Transition Act''.
        The Chairman called the meeting to order at 2:20 p.m. and
    stated that a copy of an Amendment in the Nature of a
    Substitute and section-by-section analysis to H.R. 2854 was
    available to each Member at his place on the rostrum.
        Thereafter, the Chairman stressed the need to enact a farm
    program as expeditiously as possible as the delay in reaching
    balanced budget package had created problems in agriculture
    which would require special action to resolve. The Chairman
    acknowledged that the permanent law of the Agriculture Act of
    1949 is now in place and if it takes effect, it would be very
    costly and highly disruptive for farmers. The Chairman noted
    that some Members had discussed a two-year extension of the
    1990 Farm Bill, but that agriculture had already lost $7.8
    billion in available funding in the December baseline update
    and that, if current law were to be extended for two years, the
    next farm bill debate would occur after further baseline
    updates had lost another $5 to $6 billion for agriculture. The
    Chairman further stated that a simple extension would prevent
    the deregulation and reform of agriculture policy that was
    achieved in the Balanced Budget Act in H.R. 2854.
        All Members were given permission to insert their
    statements for the record as the Chairman wished to expedite
    consideration of the bill.
        The Chairman made a presentation to Chairman Emeritus de la
    Garza for his past contributions to the Committee and noted
    that he had announced his retirement after this term.
        Without objection, the Chairman laid before the Committee
    the Amendment in the Nature of a Substitute to H.R. 2854 and
    stated that the Amendment would be considered as original text
    for purposes of amendment by title.
        Mr. Dooley was then recognized on behalf of himself, Mr.
    Pomeroy, and Mr. Johnson of South Dakota, to offer a Pomeroy-
    Dooley-Johnson En Bloc Amendment to the Substitute that
    provides:
              forgiveness of unearned advance deficiency payments
            for those producers who had a 35% or greater loss in
            crop yields in 1995;
              a payment to producers equal to 50% of the payments
            that would be made under the production flexibility
            contracts;
              a marketing assistance loan set at 90% of the 5 year
            olympic average for wheat, feed grains, cotton, rice
            and oilseeds that would continue as permanent law
            beyond crop year 2002, with no Findley loan rate
            adjustment authority for wheat and feed grains;
              retaining the Farmer Owned Reserve;
              $2.5 billion to be allocated to the Crop Insurance
            Fund;
              deleting the caps on the Export Enhancement Program
            and the Market Promotion Program funding levels;
              $2.5 billion for research, education, and extension
            activities;
              $2.5 billion for conservation and rural development
            activities;
              an additional $150 million per year to the amount
            available for the Livestock Environmental Assistance
            Program over the next seven years; and
              authority to make new enrollments in the Conservation
            Reserve Program.
      Discussion occurred and by a recorded vote 18 yeas to 27
    nays, the En Bloc Amendment was not adopted. See Roll Call Vote
    #1.
        Mr. Johnson then offered and explained an amendment
    regarding loan rates for marketing assistance loans for
    soybeans and other oilseeds that would have provided that such
    loans be set at not less than 90% of the average price received
    during the 5 previous marketing years, excluding the highest
    and lowest. Discussion occurred and by a recorded vote of 20
    yeas to 26 nays, the amendment was not adopted. See Roll Call
    Vote #2.
        Mr. Minge was then recognized to offer and explain an
    amendment to strike all of Title I except for the sugar and
    peanut sections and to replace it with marketing loans for
    certain commodities with a loan rate of 100% of the average
    price with a cap of $175,000 for such loans. Discussion
    occurred and by a recorded vote of 8 yeas to 36 nays, the
    amendment was not adopted. See Roll Call Vote #3.
        Mr. Stenholm was then recognized to offer and explain an
    amendment relating to production flexibility contracts
    exemption from provisions of Budget Act sequestration actions.
    Discussion occurred and without objection the amendment was
    withdrawn.
        Mrs. Clayton offered and explained an amendment regarding
    investment for agriculture and rural America which would create
    a new title VII that provided for $3.5 of funds out of the
    Commodity Credit Corporation for a variety of rural development
    activities, conservation, and research. Discussion occurred and
    by a recorded vote of 20 yeas to 27 nays, the amendment was not
    adopted. See Roll Call Vote #4.
        Mr. Stenholm was recognized to offer and explain an
    amendment regarding the peanut title. The amendment would--
              increase the quota support rate to $640;
              delete the provision that requires a 5 percent
            reduction in loans to producers who reject offers from
            handlers.
              change the priority method for covering losses in
            area pools;
              change the ineligibility provisions for owning quota
            to include an actively engaged standard instead of out-
            of-state residency; and
              change the quota transfer provisions to limit
            transfers to States with more than 10,000 tons of
            quota, with an overall 30 percent limit.
    Mr. Stenholm requested that his amendment be divided into a
    series of amendments. Discussion occurred on the first
    amendment which would delete the provision that requires a 5
    percent reduction in loans to producers who reject offers from
    handlers. By a recorded vote of 17 yeas to 30 nays, the
    amendment was not adopted. See Roll Call Vote #5. Further
    discussion occurred, and Mr. Stenholm withdrew the remainder of
    his amendments without objection.
        Mr. Minge was then recognized to offer and explained an
    amendment which would eliminate the Secretary's authority to
    reduce loan rates for wheat and feed grains based on stocks to
    use ratios (also known as the Findley adjustment provision).
    Discussion occurred and by a voice vote, the amendment was not
    adopted.
        At this point, Mr. Minge then offered and explain an
    amendment that provided a person with ``adjusted gross income''
    in excess of $100,000 or more from off-farm sources would not
    be eligible for production flexibility contract payments.
    Discussion occurred and by a voice vote, the amendment was not
    adopted.
        Mr. Volkmer was recognized to offer and explain an
    amendment that would amend the payment limitation provisions in
    section 1001, 1001A, 1001B, and 1001C of the Food Security Act
    of 1985 by: striking the ``three-entity rule''; requiring that
    payments to corporations or other entities be directly
    attributed to individual owners in proportion to their interest
    in the entity; and using Social Security numbers to track
    payments. Discussion occurred and by a voice vote, the
    amendment was not adopted.
        Mr. Peterson was then recognized to offer and explain an
    amendment which would eliminate the optional contract
    terminations under the Conservation Reserve Program. Discussion
    occurred and by a voice the vote, the amendment was adopted.
        Mr. Farr then offered and explained an amendment concerning
    farmland protection and federal cost sharing for acquisition of
    farmland protection easements. Discussion occurred, and the
    Chairman requested that Mr. Farr withdraw his amendment, but
    that his rights would be protected to offer the amendment with
    the Committee when it considered further farm bill legislation
    this Spring. Without objection, Mr. Farr withdrew his
    amendment.
        Mr. Minge was recognized to offer and explain an amendment
    concerning eligible lands for enrollment in the Conservation
    Reserve Program. Discussion occurred and the Chairman expressed
    his desire for this type of amendment to be taken up later this
    Spring in further farm bill consideration. Without objection,
    Mr. Minge withdrew his amendment.
        Mr. Canady was then recognized to offer and explain an
    amendment on behalf of himself, Mrs. Thurman, and Mr. Foley
    which would subject imported tomatoes to the same packing
    requirements as those imposed on the domestic industry.
    Discussion occurred with the Chairman noting that the Committee
    on Agriculture and the Committee on Ways and Means share
    jurisdiction over this issue. Mr. Canady, without objection,
    withdrew the amendment.
        Mr. Johnson was recognized to offer and explain an
    amendment which would establish a Commission on Concentration
    in the Livestock Industry. The Chairman noted that this issue
    was also one which shared jurisdiction by both the Agriculture
    Committee and the Judiciary Committee. Discussion occurred and
    without objection, the amendment was withdrawn.
        Mr. Emerson was then recognized to offer and explain an
    amendment on behalf of himself, Mr. Roberts, and Mr. Condit to
    extend the authority of the Secretary of Agriculture and the
    Administrator of the Agency for International Development to
    enter into agreements and provide assistance under the Food for
    Peace Program and the Food for Progress programs through year
    1996. Discussion occurred and by a voice vote the amendment was
    adopted.
        Mr. Emerson then moved that the Amendment in the Nature of
    a Substitute to H.R. 2854, as amended, be adopted and favorably
    reported to the House. By a recorded vote of 29 yeas to 17
    nays, and in the presence of a quorum, H.R. 2854, as amended,
    was ordered favorably reported to the House. See Roll Call Vote
    #6.
        Mr. Volkmer indicated that there would be Minority Views
    and objected to a waiver of the three-day rule, but did
    indicate to make every effort to have the views as quickly as
    possible.
        Without objection, Mr. Barrett asked unanimous consent to
    be recorded as a yea vote of favorably reporting the bill to
    the House.
        Mr. Emerson then made a motion to authorize the Chairman to
    offer such motions as may be necessary in the House to go to
    conference with the Senate on H.R. 2854 or a similar Senate
    bill. Without objection the motion was agreed to.
        The Chairman then thanked the Members and adjourned the
    meeting subject to the call of the Chair.

                                 rollcall votes

        In compliance with clause 2(l)(2)(B) of rule XI of the
    House of Representatives, the Committee sets forth the record
    of the following rollcall votes taken with respect to H.R.
    2854:

    Rollcall No. 1

        Summary: Pomeroy-Dooley-Johnson En Bloc Amendment.
        Offered By: Mr. Dooley.
        Results: Failed by rollcall vote: 18 yeas/27 nays/4 not
    voting.
        Yeas: Cong. de la Garza, Cong. Brown, Cong. Rose, Cong.
    Stenholm, Cong. Volkmer, Cong. Johnson, Cong. Dooley, Cong.
    Clayton, Cong. Minge, Cong. Hilliard, Cong. Pomeroy, Cong.
    Holden, Cong. Baesler, Cong. Thurman, Cong. Bishop, Cong. Farr,
    Cong. Pastor, and Cong. Baldacci.
        Nays: Cong. Emerson, Cong. Gunderson, Cong. Combest, Cong.
    Allard, Cong. Barrett, Cong. Ewing, Cong. Doolittle, Cong.
    Goodlatte, Cong. Pombo, Cong. Canady, Cong. Smith, Cong.
    Everett, Cong. Lucas, Cong. Lewis, Cong. Baker, Cong. Crapo,
    Cong. Calvert, Cong. Chenoweth, Cong. Hostettler, Cong. Bryant,
    Cong. Latham, Cong. Cooley, Cong. Foley, Cong. Chambliss, Cong.
    LaHood, Cong. Peterson, and Cong. Roberts, Chairman.
        Not voting: Cong. Boehner, Cong. Condit, and Cong.
    McKinney, Cong. Thompson.

    Rollcall No. 2

        Summary: Amendment concerning loan rates for marketing
    assistance loans for soybeans and other oilseeds.
        Offered By: Mr. Johnson.
        Results: Failed by a rollcall vote: 20 yeas/26 nays/3 not
    voting.
        Yeas: Cong. de la Garza, Cong. Brown, Cong. Rose, Cong.
    Stenholm, Cong. Volkmer, Cong. Johnson, Cong. Condit, Cong.
    Peterson, Cong. Dooley, Cong. Clayton, Cong. Minge, Cong.
    Hilliard, Cong. Pomeroy, Cong. Holden, Cong. Baesler, Cong.
    Thurman, Cong. Bishop, Cong. Farr, Cong. Pastor, and Cong.
    Baldacci.
        Nays: Cong. Emerson, Cong. Gunderson, Cong. Combest, Cong.
    Allard, Cong. Barrett, Cong. Ewing, Cong. Doolittle, Cong.
    Goodlatte, Cong. Pombo, Cong. Canady, Cong. Smith, Cong.
    Everett, Cong. Lucas, Cong. Lewis, Cong. Baker, Cong. Crapo,
    Cong. Calvert, Cong. Chenoweth, Cong. Hostettler, Cong. Bryant,
    Cong. Latham, Cong. Cooley, Cong. Foley, Cong. Chambliss, Cong.
    LaHood, and Cong. Roberts, Chairman.
        Not voting: Cong. Boehner, Cong. McKinney, and Cong.
    Thompson.

    Rollcall No. 3

        Summary: Amendment to strike all of title I, Agricultural
    Market Transition Programs, except for those provisions
    concerning sugar and peanuts and to replace with marketing
    loans for certain commodities.
        Offered By: Mr. Minge.
        Results: Failed by a rollcall vote: 8 yeas/36 nays/5 not
    voting.
        Yeas: Cong. Volkmer, Cong. Johnson, Cong. Peterson, Cong.
    Clayton, Cong. Minge, Cong. Hilliard, Cong. Pomeroy, and Cong.
    Holden.
        Nays: Cong. Emerson, Cong. Gunderson, Cong. Combest, Cong.
    Allard, Cong. Barrett, Cong. Ewing, Cong. Doolittle, Cong.
    Goodlatte, Cong. Pombo, Cong. Canady, Cong. Smith, Cong.
    Everett, Cong. Lucas, Cong. Lewis, Cong. Baker, Cong. Crapo,
    Cong. Calvert, Cong. Chenoweth, Cong. Hostettler, Cong. Bryant,
    Cong. Latham, Cong. Cooley, Cong. Foley, Cong. Chambliss, Cong.
    LaHood, Cong. de la Garza, Cong. Rose, Cong. Stenholm, Cong.
    Dooley, Cong. Baesler, Cong. Thurman, Cong. Bishop, Cong. Farr,
    Cong. Pastor, Cong. Baldacci, and Cong. Roberts, Chairman.
        Not voting: Cong. Boehner, Cong. Brown, Cong. Condit, Cong.
    McKinney, and Cong. Thompson.

    Rollcall No. 4

        Summary: Amendment to create a new title VII that provided
    for $3.5 billion of funds out of the CCC for a variety of rural
    development type activities.
        Offered By: Mrs. Clayton.
        Results: Failed by a rollcall vote: 20 yeas/27 nays/2 not
    voting.
        Yeas: Cong. de la Garza, Cong. Brown, Cong. Rose, Cong.
    Stenholm, Cong. Volkmer, Cong. Johnson, Cong. Peterson, Cong.
    Dooley, Cong. Clayton, Cong. Minge, Cong. Hilliard, Cong.
    Pomeroy, Cong. Holden, Cong. Baesler, Cong. Thurman, Cong.
    Bishop, Cong. Thompson, Cong. Farr, Cong. Pastor, and Cong.
    Baldacci.
        Nays: Cong. Emerson, Cong. Gunderson, Cong. Combest, Cong.
    Allard, Cong. Barrett, Cong. Boehner, Cong. Ewing, Cong.
    Doolittle, Cong. Goodlatte, Cong. Pombo, Cong. Canady, Cong.
    Smith, Cong. Everett, Cong. Lucas, Cong. Lewis, Cong. Baker,
    Cong. Crapo, Cong. Calvert, Cong. Chenoweth, Cong. Hostettler,
    Cong. Bryant, Cong. Latham, Cong. Cooley, Cong. Foley, Cong.
    Chambliss, Cong. LaHood, and Cong. Roberts, Chairman.
        Not voting: Cong. Condit and Cong. McKinney.

    Rollcall No. 5

        Summary: Amendment to the Peanut Title.
        Offered By: Mr. Stenholm.
        Results: Failed by a rollcall vote: 17 yeas/30 nays/2 not
    voting.
        Yeas: Cong. de la Garza, Cong. Brown, Cong. Rose, Cong.
    Stenholm, Cong. Volkmer, Cong. Johnson, Cong. Peterson, Cong.
    Clayton, Cong. Hilliard, Cong. Pomeroy, Cong. Baesler, Cong.
    Thurman, Cong. Thompson, Cong. Farr, Cong. Pastor, and Cong.
    Baldacci.
        Nays: Cong. Emerson, Cong. Gunderson, Cong. Combest, Cong.
    Allard, Cong. Barrett, Cong. Boehner, Cong. Ewing, Cong.
    Doolittle, Cong. Goodlatte, Cong. Pombo, Cong. Canady, Cong.
    Smith, Cong. Everett, Cong. Lucas, Cong. Lewis, Cong. Baker,
    Cong. Crapo, Cong. Calvert, Cong. Chenoweth, Cong. Hostettler,
    Cong. Bryant, Cong. Latham, Cong. Cooley, Cong. Foley, Cong.
    Chambliss, Cong. LaHood, Cong. Dooley, Cong. Holden, Cong.
    Bishop, and Cong. Roberts, Chairman.
        Not voting: Cong. Condit and Cong. McKinney.

    Rollcall No. 6

        Summary: Final Passage on the Amendment in the Nature of a
    Substitute to H.R. 2854, as amended.
        Offered By: Mr. Roberts.
        Results: Adopted by a rollcall vote: 29 yeas/17 nays/3 not
    voting.
        Yeas: Cong. Emerson, Cong. Gunderson, Cong. Combest, Cong.
    Allard, Cong. Barrett, Cong. Boehner, Cong. Ewing, Cong.
    Goodlatte, Cong. Pombo, Cong. Canady, Cong. Smith, Cong.
    Everett, Cong. Lucas, Cong. Lewis, Cong. Baker, Cong. Crapo,
    Cong. Calvert, Cong. Chenoweth, Cong. Hostettler, Cong. Bryant,
    Cong. Latham, Cong. Cooley, Cong. Foley, Cong. Chambliss, Cong.
    LaHood, Cong. Condit, Cong. Peterson, Cong. Bishop, and Cong.
    Roberts, Chairman.
        Nays: Cong. de la Garza, Cong. Brown, Cong. Stenholm, Cong.
    Volkmer, Cong. Johnson, Cong. Dooley, Cong. Clayton, Cong.
    Minge, Cong. Hilliard, Cong. Pomeroy, Cong. Holden, Cong.
    Baesler, Cong. Thurman, Cong. Thompson, Cong. Farr, Cong.
    Pastor, and Cong. Baldacci.
        Not voting: Cong. Doolittle, Cong. Rose, and Cong.
    McKinney.

                            Administration Position

        The views of the Administration on H.R. 2854, as amended,
    to modify the operation of certain agricultural programs, was
    not received prior to the filing of this report.
        However, the views of the Administration on H.R. 2854 prior
    to Committee consideration are set forth in the following
    letter to the Chairman of the Committee on Agriculture:

                             Department of Agriculture,
                                       Office of the Secretary,
                                      Washington, DC, January 30, 1996.
    Hon. Pat Roberts,
    Chairman, Committee on Agriculture,
    House of Representatives, Longworth House Office Building, Washington,
            DC.
        Dear Mr. Chairman: This is in response to your request for
    the Department of Agriculture's comments on H.R. 2854, a bill
    ``To modify the operation of certain agricultural programs.''
        The Administration recognizes the need for legislation to
    reauthorize the farm programs, either through an extension of
    existing legislation or a new bill acceptable to the
    Administration. However, the Department does not support
    enactment of this legislation in its present form.
        H.R. 2854, the ``Agricultural Market Transition Act,''
    provides some positive features. The Clinton Administration has
    long supported the concept of increased planting flexibility so
    farmers can plant for the market, not for the Government. This
    bill also ensures a set level of funding to rural America.
        This Administration is committed to developing agricultural
    policy legislation that fulfills three basic principles in
    order to enhance the economic opportunities and environment for
    farmers and other residents of rural America: (1) preservation
    of a responsible safety net for farmers; (2) promotion of
    exports and maintenance of a vibrant rural economy; and (3)
    protection and enhancement of the rural environment. We
    continue to have serious concerns regarding H.R. 2854's ability
    to satisfy these principles.
        H.R. 2854 contains essentially the same provisions, with
    minor revisions, as the Agricultural Reconciliation Act of
    1995, which I recommended that President Clinton veto. We
    recommend supplementing farm income through a countercyclical
    program of income support payments, so that help is provided
    where there is the most need. We do not believe that producers
    should be provided a windfall when prices are strong, as H.R.
    2854 does.
        We do understand that some farmers may not benefit from
    high market prices because of low yields and little production.
    That is why we continue to support maintaining the linkage
    between crop insurance and program participation, with
    necessary modifications to reduce paperwork requirements. H.R.
    2854 undoes the crop insurance reforms that Congress enacted,
    just one year ago, with widespread bipartisan support.
        H.R. 2854 caps the level of marketing loans for wheat and
    feed grains. Enhancing these loan rates, and removing the caps,
    would help strengthen the safety net for farmers.
        We are in general agreement with the elimination of
    authority for commodity acreage reduction programs. However,
    given the unpredictability of agricultural production, we
    believe that there should be standby authority to implement
    supply controls as a last resort when supply and demand are
    critically out of balance.
        One essential component of a safety net for American
    agriculture is the existence of permanent authority to carry
    out commodity programs beyond the year 2002. H.R. 2854 repeals
    current permanent authority. We would recommend permanent
    authority for programs after the expiration of the provisions
    of H.R. 2854.
        We believe that, instead of providing producers windfall
    gains, resources must be directed to those needs that will make
    agriculture strong and ensure a vibrant rural economy. We
    strongly support providing adequate support for priorities in
    conservation, research, rural development, export
    opportunities, and innovative partnerships with farmers to
    share agriculture's risks. The Administration's ``Fund for
    Rural America'' proposal would accomplish this goal.
        There are a number of other provisions affecting
    conservation programs which the Department believes should be
    modified. We generally agree with capping Conservation Reserve
    Program (CRP) enrollment at 36.4 million acres, and providing
    authority for early termination of CRP contracts. However, we
    strongly recommend also providing authority for the Department
    to enroll new acres in the CRP so that additional
    environmentally valuable or fragile cropland can be retired
    from production. We do not support the 60-day notice of early
    release without restrictions. The Secretary of Agriculture
    should be given authority to establish reasonable limits on
    what land now enrolled in CRP contracts should be subject to
    early release, including the authority to deny requests from
    producers for termination of their CRP contracts.
        We support the concept of the Livestock Environmental
    Assistance Program (LEAP). However, this program could be
    enhanced considerably if eligibility were expanded to include
    the Environmental Quality Incentives Program (EQIP). Such
    expansion in eligibility should also be accompanied by an
    increase in funding authority. We also recommend that the size
    limitations be eliminated so that the Secretary of Agriculture
    would have more administrative flexibility in determining
    eligibility for assistance.
        We also support the change in use of Commodity Credit
    Corporation (CCC) funds for conservation programs. It is
    important that adequate funding for CRP be assured, which H.R.
    2854 accomplishes. We note, however, that subsections (a) and
    (c) of section 201 of the bill would amend section 1241 of the
    Food Security Act of 1985 in a conflicting manner. Subsection
    (a) would allow the use of CCC funds for CRP, the Wetland
    Reserve Program (WRP), and LEAP without the need for annual
    appropriations. Subsection (c), however, would require annual
    appropriations to CCC for WRP and LEAP.
        The Department does not support the elimination of
    authority for permanent easements for WRP. In some cases,
    restoring lands, like bottomland hardwoods, to full wetland
    functions and values may require longer time periods. We
    believe landowners should have the option of obtaining
    permanent and 30-year easements.
        The funding levels for the Export Enhancement Program (EEP)
    under H.R. 2854 are $1.58 billion below the U.S. subsidy value
    commitments under the Uruguay Round Agreement. The adoption of
    H.R. 2854 would greatly limit the ability of the Department to
    assist U.S. agricultural exports in years with high levels of
    accumulated stocks, within the allowable limits of the Uruguay
    Round Agreement. The funding reductions for EEP from allowable
    limits occur for fiscal years 1996 through 1999, whereas the
    authorized levels for EEP in fiscal years 2000 through 2002 are
    the same as the U.S. Uruguay Round Agreement commitments.
        Likewise, H.R. 2854 establishes a ceiling on funding for
    the Market Promotion Program (MPP) from the current level of
    $110 million to $100 million. The MPP is the Department's major
    export assistance program for processed and high value
    agricultural products. The Department opposes the establishment
    of a spending ceiling in H.R. 2854 for both the EEP and the
    MPP.
        The Department supports section 402 of the bill, which
    positively affects the Agricultural Quarantine and Inspection
    program by ensuring it provides industry with the level of
    service it is paying for. We understand that the Committee has
    addressed the Pay-As-You-Go issue through its internal budget
    process.
        The Department also supports elimination of the honey
    program.
        H.R. 2854 also contains other provisions with which the
    Department has concerns. We do not support elimination of the
    Emergency Livestock Assistance Program. Instead, we recommend
    maintaining the program, but denying eligibility when
    qualifying losses are covered by crop insurance. The Department
    also recommends that the Farmer-owned Reserve be maintained,
    but with additional reforms designed to maintain stable grain
    markets. Also, we believe that the prohibition of using CCC
    funds for salaries and expenses, if not combined with an
    increase in USDA's discretionary funding, could adversely
    affect the Department's ability to efficiently administer
    agricultural programs in a timely manner.
        H.R. 2854 still fails to address some important areas. In
    particular, there are no provisions to reauthorize dairy
    legislation. Many reforms in conservation programs, such as
    more farmer-friendly procedures for conservation compliance
    violations, are also not addressed. And, research funding and
    policies are absent from the bill.
        Because of the fundamental change in program structure,
    implementation of this bill would pose many significant
    hurdles. The requirement to have producers sign a 7-year Market
    Transition Contract by April 15, 1996, is becoming more
    impractical with the passage of time without a farm bill. Many
    producers who lease land are very concerned about the ability
    to obtain agreement with their landlords for a 7-year contract.
        The Office of Management and Budget advises that there is
    no objection to the presentation of this report from the
    standpoint of the Administration's program.
                Sincerely,
                                               Dan Glickman, Secretary.

              Budget Act Compliance (Section 308 and Section 403)

        The provisions of clause 2(l)(3)(B) of rule XI of the Rules
    of the House of Representatives and section 308(a) of the
    Congressional Budget Act of 1974 (relating to estimates of new
    budget authority, new spending authority, or new credit
    authority, or increased or decreased revenues or tax
    expenditures) are not considered applicable. The estimate and
    comparison required to be prepared by the Director of the
    Congressional Budget Office under clause 2(l)(C)(3) of rule XI
    of the Rules of the House of Representatives and section 403 of
    the Congressional Budget Act of 1974 submitted to the Committee
    prior to the filing of this report are as follows:

                                         U.S. Congress,
                                   Congressional Budget Office,
                                      Washington, DC, January 31, 1996.
    Hon. Pat Roberts,
    Chairman, Committee on Agriculture,
    House of Representatives, Washington, DC.
        Dear Mr. Chairman: The Congressional Budget Office (CBO)
    has reviewed H.R. 2854, a bill to modify the operation of
    certain agricultural programs, as ordered reported by the House
    Committee on Agriculture on January 30, 1996. This estimate is
    based on language provided by committee staff on January 31,
    1996.
        We estimate that enacting H.R. 2824 would reduce federal
    outlays over the 1996-2002 period by changing selected
    commodity, conservation, and export programs. Relative to the
    baseline underlying the Fiscal Year 1996 Budget Resolution, we
    estimate cumulative savings in federal agriculture spending of
    $12.8 billion over the 1996-2002 period. Under the assumptions
    of the updated CBO baseline completed in December 1995,
    reflecting more current conditions in agricultural markets, we
    estimate cumulative savings of $5.4 billion over the same
    period. These amounts would be reductions in direct spending;
    therefore, pay-as-you-go procedures would apply to the bill.
        In preparing this estimate, we assumed that the bill will
    be enacted by April 1, 1996; the estimate could change if the
    bill is enacted later.
        Attachment 1 provides our estimate of the bill's impact on
    the federal budget. Table 1 is a summary of the estimated
    effects on spending by the Commodity Credit Corporation (CCC)
    under the two different sets of assumptions. Under budget
    resolution assumptions, baseline spending by the CCC totals
    $56.6 billion over the seven-year period. The bill would reduce
    those outlays by an estimated $11.8 billion. Under December
    baseline assumptions, CCC spending totals $48.7 billion over
    seven years, and estimated savings from enacting the bill would
    be $4.4 billion.
        Table 2 details the estimated effects of major provisions
    relative to the budget resolution baseline, while Table 3 shows
    the estimated effects relative to CBO's December 1995 baseline.
        CBO has determined that enacting H.R. 2854 would impose
    private sector mandates as defined in Public Law 104-4, and
    Attachment 2 provides our analysis of those mandates.
        H.R. 2854 contains no intergovernmental mandates, as
    defined in Public Law 104-4, that impose any significant costs
    on state, local, or tribal governments. The bill would,
    however, result in reduced federal payments to state, local,
    and tribal governments that own farm land and receive subsidy
    payments. Public entities would no longer receive any price
    support payments under the peanut program as a result of this
    bill. Further, they would bear a small share of the cuts in
    other farm programs. CBO has not completed an estimate of the
    impact of these changes on state, local, and tribal
    governments.
        If you wish further details on this estimate, we will be
    pleased to provide them. The CBO staff contacts are David Hull,
    Craig Jagger, and Victoria Heid, Roger Hitchner, and, for
    intergovernmental impacts, Marjorie Miller.
                Sincerely,
                                                  James L. Blum
                                       (For June E. O'Neill, Director).
        Attachments.

     REPLACEMENT FOR TABLE 1, INCORPORATING AMENDMENTS PROVIDED ON FEBRUARY 2, 1996--ESTIMATED EFFECTS OF H.R. 2854
                                        ON THE COMMODITY CREDIT CORPORATION (CCC)
                                        [In millions of dollars, by fiscal year]
    ----------------------------------------------------------------------------------------------------------------
                                                                                                           1996-2002
                                      1996      1997      1998      1999      2000      2001      2002       total
    ----------------------------------------------------------------------------------------------------------------
                                  ESTIMATES RELATIVE TO THE BUDGET RESOLUTION BASELINE

    Spending Under Current Law:
        Estimated budget authority     8,891     8,736     8,614     8,402     8,193     7,830     7,737      58,403
        Estimated outlays.........     8,612     8,515     8,372     8,157     7,928     7,561     7,468      56,612
    Proposed Changes:
        Estimated budget authority      -682    -1,646    -1,280    -1,392    -1,570    -2,495    -2,589     -11,654
        Estimated outlays.........      -759    -1,664    -1,294    -1,401    -1,576    -2,498    -2,590     -11,782
    Spending Under H.R. 2854:
        Estimated budget authority     8,209     7,090     7,334     7,010     6,623     5,335     5,148      46,749
        Estimated outlays.........     7,853     6,851     7,078     6,756     6,352     5,063     4,878      44,830

                                  ESTIMATES RELATIVE TO THE CBO DECEMBER 1995 BASELINE

    Spending Under Current Law:
        Estimated budget authority     4,069     5,852     8,216     8,445     8,085     7,911     7,882      50,459
        Estimated outlays.........     3,790     5,631     7,073     8,200     7,820     7,642     7,613      18,668
    Proposed Changes:
        Estimated budget authority     3,219     1,128      -831    -1,368    -1,414    -2,388    -2,648      -4,302
        Estimated outlays.........     3,142     1,110      -845    -1,377    -1,420    -2,391    -2,649      -4,430
    Spending Under H.R. 2854:
        Estimated budget authority     7,288     6,980     7,385     7,077     6,671     5,523     5,234      46,157
        Estimated outlays.........     6,932     6,741     7,128     6,823     6,400     5,251     4,964      44,238
    ----------------------------------------------------------------------------------------------------------------
    Note.--Includes spending for programs covered by the CCC Fund account, plus the export guarantee liquidating and
      subsidy accounts. Program changes in the bill that have an estimated budgetary impact but are excluded from
      this table are those dealing with crop insurance, seed disaster, Agricultural Quarantine Inspection Fund, the
      Wetlands Reserve Program (WRP) and the Conservation Reserve Program (CRP). Provisions in the bill make it
      unclear whether the CRP and WRP should continue outside of, or be moved into, the CCC.

     REPLACEMENT FOR TABLE 2, INCORPORATING AMENDMENTS PROVIDED ON FEBRUARY 2, 1996--ESTIMATED BUDGETARY EFFECTS OF
                         H.R. 2854, RELATIVE TO THE FISCAL YEAR 1996 BUDGET RESOLUTION BASELINE
                                        [In millions of dollars, by fiscal year]
    ----------------------------------------------------------------------------------------------------------------
                                                                                                           1996-2002
                                      1996      1997      1998      1999      2000      2001      2002       total
    ----------------------------------------------------------------------------------------------------------------
                                               CHANGES IN DIRECT SPENDING

    Freedom to Farm contracts in
     lieu of deficiency payments:
        Estimated budget authority      -595      -848      -851      -984    -1,241    -2,045    -2,036      -8,600
        Estimated outlays.........      -595      -848      -851      -984    -1,241    -2,045    -2,036      -8,600
    Cap crop price-support loan
     rates:
        Estimated budget authority       -16        85        35       -70       -49       -55       -38        -108
        Estimated outlays.........       -16        85        35       -70       -49       -55       -38        -108
    Cap seven-year cotton Step-2
     payments at $701 million:
        Estimated budget authority  ........         1         2         2         2       -69      -116        -178
        Estimated outlays.........  ........         1         2         2         2       -69      -116        -178
    End cotton 8-month loan
     extension:
        Estimated budget authority  ........       -55        -5        -5        -5        -2         0         -72
        Estimated outlays.........  ........       -55        -5        -5        -5        -2         0         -72
    Prohibit use of CCC funds for
     administrative expenses:
        Estimated budget authority       -27      -177       -42       -40       -41       -41       -41        -409
        Estimated outlays.........       -27      -177       -42       -40       -41       -41       -41        -409
    Reform peanut program:
        Estimated budget authority  ........       -95       -69       -69       -67       -68       -66        -434
        Estimated outlays.........  ........       -95       -69       -69       -67       -68       -66        -434
    Reform sugar program
     (increased assessments):
        Estimated budget authority  ........        -8        -8        -8        -9        -9        -9         -51
        Estimated outlays.........  ........        -8        -8        -8        -9        -9        -9         -51
    End emergency feed assistance
     programs:
        Estimated budget authority       -40       -80       -80       -80       -80       -80       -80        -520
        Estimated outlays.........       -40       -80       -80       -80       -80       -80       -80        -520
    End honey program:
        Estimated budget authority  ........  ........  ........        -1        -2  ........  ........          -3
        Estimated outlays.........  ........  ........  ........        -1        -2  ........  ........          -3
    End Farmer-Owned Reserve:
        Estimated budget authority  ........       -18       -18       -18       -18       -18       -18        -108
        Estimated outlays.........  ........       -18       -18       -18       -18       -18       -18        -108
    Livestock Environmental
     Assistance Program:
        Estimated budget authority       100       100       100       100       100       100       100         700
        Estimated outlays.........        23        82        86        91        94        97        99         572
    Dairy Program changes:
        Estimated budget authority        72        29       -13       -39      -110      -158      -235        -454
        Estimated outlays.........        72        29       -13       -39      -110      -158      -235        -454
    Limit CRP to 36.4 million
     acres:
        Estimated budget authority  ........       -41      -118      -109      -102      -100       -99        -569
        Estimated outlays.........  ........       -41      -118      -109      -102      -100       -99        -569
    Cap WRP acreage and limit
     easements:
        Estimated budget authority       -24       -66       -66       -66       -66        54        54        -180
        Estimated outlays.........        -3       -47       -90       -94       -92       -74        13        -387
    Reduce Market Promotion
     Program spending:
        Estimated budget authority        -1        -8       -10       -10       -10       -10       -10         -59
        Estimated outlays.........        -1        -8       -10       -10       -10       -10       -10         -59
    Cap Export Enhancement Program
     spending:
        Estimated budget authority      -165      -532      -281      -130         0         0         0      -1,108
        Estimated outlays.........      -165      -532      -281      -130         0         0         0      -1,108
    End mandatory crop insurance
     catastrophic coverage:
        Estimated budget authority        -5       -27       -28       -28       -29       -29       -29        -175
        Estimated outlays.........        -2       -13       -28       -28       -29       -29       -29        -158
    Provide disaster assistance
     for seed crops:
        Estimated budget authority         7         7         7         7         7         7         7          49
        Estimated outlays.........         3         7         7         7         7         7         7          45
    Direct access to Agricultural
     Quarantine Inspection Fund:
        Estimated budget authority         8         9        10        10        13        17        21          88
        Estimated outlays.........         8         9        10        10        13        17        21          88
    Increase CCC commodity loan
     interest rate:
        Estimated budget authority       -10       -40       -40       -40       -40       -40       -40        -250
        Estimated outlays.........       -10       -40       -40       -40       -40       -40       -40        -250
    Total Changes in Direct
     Spending:
        Estimated budget authority      -696    -1,764    -1,475    -1,578    -1,747    -2,546    -2,635     -12,441
        Estimated outlays.........      -753    -1,749    -1,513    -1,615    -1,779    -2,677    -2,677    -12,763
    ----------------------------------------------------------------------------------------------------------------
    Notes.--1. H.R. 2854 was ordered reported on January 30, 1996, by the House Committee on Agriculture. CBO based
      initial estimates on the bill as introduced, with information from committee staff on amendments adopted. This
      replacement table was based on additional technical staff amendments received on February 2, 1996.
    2. This bill would also affect sending subject to appropriations but CBO has not completed an estimate of
      potential changes in discretionary spending that might result from enacting the bill.

     REPLACEMENT FOR TABLE 3, INCORPORATING AMENDMENTS PROVIDED ON FEBRUARY 2, 1996--ESTIMATED BUDGETARY EFFECTS OF
                                  H.R. 2854, RELATIVE TO THE CBO DECEMBER 1995 BASELINE
                                        [In millions of dollars, by fiscal year]
    ----------------------------------------------------------------------------------------------------------------
                                                                                                           1996-2002
                                      1996      1997      1998      1999      2000      2001      2002       total
    ----------------------------------------------------------------------------------------------------------------
                                               CHANGES IN DIRECT SPENDING

    Freedom to Farm contracts in
     lieu of deficiency payments:
        Estimated budget authority     3,149     1,907      -165      -779    -1,098    -1,955    -2,072      -1,013
        Estimated outlays.........     3,149     1,907      -165      -779    -1,098    -1,955    -2,072      -1,013
    Marketing loan cost effects of
     planting provisions:
        Estimated budget authority        -6        13         1       208       269       229       128         842
        Estimated outlays.........        -6        13         1       208       269       229       128         842
    Cap crop price-support loan
     rates:
        Estimated budget authority        -5      -177      -192      -422      -250      -249      -149      -1,444
        Estimated outlays.........        -5      -177      -192      -422      -250      -249      -149      -1,444
    Cap seven-year cotton Step-2
     payments at $701 million:
        Estimated budget authority  ........  ........         1         1         1         1       -88         -84
        Estimated outlays.........  ........  ........         1         1         1         1       -88         -84
    End cotton 8-month loan
     extension:
        Estimated budget authority  ........       -55        -5        -5        -5        -5        -2         -77
        Estimated outlays.........  ........       -55        -5        -5        -5        -5        -2         -77
    Prohibit use of CCC funds for
     administrative expenses:
        Estimated budget authority       -27      -177       -42       -40       -41       -41       -41        -409
        Estimated outlays.........       -27      -177       -42       -40       -41       -41       -41        -409
    Reform peanut program:
        Estimated budget authority  ........       -85       -67       -61       -66       -62       -71        -412
        Estimated outlays.........  ........       -85       -67       -61       -66       -62       -71        -412
    Reform sugar program
     (increased assessments):
        Estimated budget authority  ........        -8        -8        -8        -9        -9        -9         -51
        Estimated outlays.........  ........        -8        -8        -8        -9        -9        -9         -51
    End emergency feed assistance
     programs:
        Estimated budget authority       -40       -80       -80       -80       -80       -80       -80        -520
        Estimated outlays.........       -40       -80       -80       -80       -80       -80       -80        -520
    End honey program:
        Estimated budget authority  ........        -1  ........        -1        -1        -1        -1          -5
        Estimated outlays.........  ........        -1  ........        -1        -1        -1        -1          -5
    End Farmer-Owned Reserve:
        Estimated budget authority  ........  ........        -9       -18       -18       -18       -18         -81
        Estimated outlays.........  ........  ........        -9       -18       -18       -18       -18         -81
    Dairy Program changes:
        Estimated budget authority        59         0       -34       -83      -166      -248      -295        -767
        Estimated outlays.........        59         0       -34       -83      -166      -248      -295        -767
    Livestock Environmental
     Assistance Program:
        Estimated budget authority       100       100       100       100       100       100       100         700
        Estimated outlays.........        23        82        86        91        94        97        99         572
    Limit CRP to 36.4 million
     acres:
        Estimated budget authority  ........       -41      -119      -111      -103      -102      -101        -577
        Estimated outlays.........  ........       -41      -119      -111      -103      -102      -101        -577
    Cap WRP acreage and limit
     easements:
        Estimated budget authority       -24       -66       -66       -66       -66        54        54        -180
        Estimated outlays.........        -3       -47       -90       -94       -92       -74        13        -387
    Reduce Market Promotion
     Program spending:
        Estimated budget authority        -1        -8       -10       -10       -10       -10       -10         -59
        Estimated outlays.........        -1        -8       -10       -10       -10       -10       -10         -59
    Cap Export Enhancement Program
     spending:
        Estimated budget authority  ........      -261      -281      -130         0         0         0        -672
        Estimated outlays.........  ........      -261      -281      -130         0         0         0        -672
    End mandatory crop insurance
     catastrophic coverage:
        Estimated budget authority        -5       -27       -28       -28       -29       -29       -29        -175
        Estimated outlays.........        -2       -13       -28       -28       -29       -29       -29        -158
    Provide disaster assistance
     for seed crops:
        Estimated budget authority         7         7         7         7         7         7         7          49
        Estimated outlays.........         3         7         7         7         7         7         7          45
    Direct access to Agricultural
     Quarantine Inspection Fund:
        Estimated budget authority        14        15        16        16        19        23        27         130
        Estimated outlays.........        14        15        16        16        19        23        27         130
    Increase CCC commodity loan
     interest rate:
        Estimated budget authority       -10       -40       -40       -40       -40       -40       -40        -250
        Estimated outlays.........       -10       -40       -40       -40       -40       -40       -40        -250
    Total Changes in Direct
     Spending:
        Estimated budget authority     3,211     1,016    -1,021    -1,550    -1,586    -2,435    -2,690      -5,055
        Estimated outlays.........     3,154     1,031    -1,059    -1,587    -1,618    -2,566    -2,732      -5,377
    ----------------------------------------------------------------------------------------------------------------
    Notes.--1. H.R. 2854 was ordered reported on January 30, 1996, by the House Committee on Agriculture. CBO based
      initial estimates on the bill as introduced, with information from committee staff on amendments adopted. This
      replacement table was based on additional technical staff amendments received on February 2, 1996.
    2. This bill would also affect spending subject to appropriations but CBO has not completed an estimate of
      potential changes in discretionary spending that might result from enacting the bill.

        congressional budget office estimate of costs of private sector
                                    mandates

        1. Bill number: H.R. 2854.
        2. Bill title: Agricultural Market Transition Act.
        3. Bill status: As ordered reported by the House Committee
    on Agriculture on January 30, 1996.
        4. Bill purpose: This bill would reauthorize and reform
    federal programs supporting prices and incomes of producers of
    certain grains, peanuts, sugar, cotton, and dairy products. The
    bill would also affect conservation, export promotion, and
    agricultural insurance programs.
        5. Private sector mandates contained in bill: This bill
    would impose new fees on sugar producers and importers of dairy
    products. It also contains requirements that would increase the
    costs of processing and handling milk and reduce the net
    returns of some producers of milk.
        6. Estimated direct cost to the private sector: CBO
    estimates the direct costs of the private sector mandates
    identified in this bill would exceed $800 million annually for
    the next two years and $400 million annually thereafter. The
    most costly mandate would require that milk sold for fluid uses
    contain greater amounts of nonfat solids than currently
    required. Private sector mandates identified by CBO are
    described below. Estimated costs of mandates to the private
    sector are included when possible. The bill would affect
    businesses and consumers in many ways other than through the
    mandates it contains. Estimates described below are of the
    direct costs of mandates only, not of the more general effects
    on the private sector.

    Title I--Agricultural Market Transition Program

        Section 107 would increase marketing assessments on the
    processors of sugar cane and sugar beets. The marketing
    assessment on sugar cane would increase from 1.1 percent of the
    nonrecourse loan rate to 1.375 percent beginning in 1997. The
    marketing assessment on sugar beets would increase from 1.1794
    percent of the nonrecourse loan rate to 1.47425, also beginning
    in 1997. CBO estimates that processors of sugar cane and sugar
    beets would pay an additional $8 million annually during the
    1997-1999 period and an additional $9 million each year
    thereafter. Some of this increase would be passed on to users
    of sugar and sugar-containing products in the United States.

    Title II--Dairy

        Section 204 would extend a dairy promotion assessment to
    imports of dairy products. Importers would be required to pay
    1.2 cents per pound of total milk solids contained in the
    imported product (or 15 cent per hundredweight of milk
    contained in the product, whichever is less) to a fund
    administered by the Dairy Promotion Board. These funds are used
    mainly to promote consumption of milk and milk products. The
    annual cost of importers is estimated to be less than $5
    million.
        Section 205 would increase the minimum level of nonfat
    solids required in fluid milk products. The current federal
    standard for nonfat solids in milk is 8.25 percent by weight.
    This section would increase this standard to 8.8 percent for
    whole milk, 10 percent for low-fat (or ``2 percent'') milk, 11
    percent for light (or ``1 percent'') milk, and 9 percent for
    nonfat or skim milk. The standards now in force are typically
    exceeded, but average levels of nonfat solids fall short of the
    proposed standards in all areas of the country except
    California. The state of California imposes standards similar
    to those in this bill. Increasing the amount of nonfat solids
    in fluid milk products raises costs for handlers and processors
    of fluid milk because they must buy additional solids and pay
    higher processing costs. CBO estimates that the annual cost of
    the new standards would be between $400 million and $600
    million. Most analysts believe that the bulk of such costs
    would be passed on to consumers in higher prices for fluid
    milk.
        Section 207 would establish a minimum price that handlers
    and processors of milk must pay producers for milk used in
    fluid products (Class I milk). The minimum price would be in
    effect for two years. Under current law, the minimum price paid
    for Class I milk varies monthly, and is determined as a fixed
    differential from the price paid for milk used primarily for
    cheese (the Basic Formula Price). The Basic Formula Price and,
    thus the Class I price, moves up and down with changes in
    market conditions. The new minimum price would not affect milk
    prices now, but would prevent downward movements that would
    very likely occur during the two-year period that the provision
    would be in effect. CBO estimates that this provision would
    increase costs for handlers and processors over the next two
    years. Annual additional costs could range between $400 million
    and $500 million during this period. Most such costs would be
    passed on to consumers in higher prices for fluid milk.
        Section 207 also creates a temporary national Class I pool
    that would redistribute money from dairy producers in areas
    where there is a relatively high Class I use of milk to areas
    where there is a relatively low Class I use. Class I includes
    fluid uses of milk, Class II includes soft products (ice cream
    and yogurt), and Class III/III-A includes hard products
    (cheese, butter, and dry milk). An example of an area with high
    Class I use is the Southeast, where Class I use may exceed 75
    percent of milk produced in the region. This contrasts with the
    Upper Midwest where less than 20 percent of milk is used for
    fluid purposes.
        This section would require that $0.80 per hundredweight of
    milk used for Class I uses be collected each month (through the
    system of federal marketing orders that regulate milk prices).
    This amount of money, which could total $400 million annually,
    would then be redistributed to dairy producers (again through
    their marketing orders) according to their share of total
    production. This mandate would have no net cost to dairy
    producers as a group. It would have a net cost to producers in
    areas with relatively high Class I use of milk and a net
    benefit to producers in areas with relatively low Class I use.
        Section 208 would define a new class of milk (Class IV--
    milk used in butter, butter oil, and dry milk). It would also
    create a temporary national pool that would redistribute money
    from dairy producers in areas with low Class IV use to areas
    with high Class IV use. The amount collected and redistributed
    would depend on market prices of nonfat dry milk and butter.
    CBO has not estimated the amount of funds involved. Like the
    Class I pool discussed above, however, there is no net cost of
    this provision to dairy producers as a whole, though producers
    in some areas would pay and producers in other areas would
    benefit.
        7. Previous CBO estimate: None
        8. Estimate prepared by: Roger Hitchner and Jean Wooster.
        9. Estimate approved by: Jan Acton, Assistant Director for
    Natural Resources and Commerce.

                         Inflationary Impact Statement

        Pursuant to class (2)(l)(4) of rule XI of the Rules of the
    House of Representatives, the Committee estimates that
    enactment of H.R. 2854, as amended, will have no inflationary
    impact on the national economy.

                              oversight statement

        No summary of oversight findings and recommendations made
    by the Committee on Government Reform and Oversight under
    clause 2(l)(3)(D) of rule XI of the Rules of the House of
    Representatives was available to the Committee with reference
    to the subject matter specifically addressed by H.R. 2854, as
    amended.
        No specific oversight activities other than the hearings
    detailed in this report were conducted by the Committee within
    the definition of clause 2(b)(1) of rule X of the Rules of the
    House of Representatives.

             Changes in Existing Law Made by the Bill, as Reported

      In compliance with clause 3 of rule XIII of the Rules of the
    House of Representatives, changes in existing law made by the
    bill, as reported, are shown as follows (existing law proposed
    to be omitted is enclosed in black brackets, new matter is
    printed in italic, existing law in which no change is proposed
    is shown in roman):

                           FOOD SECURITY ACT OF 1985

              * * * * * * *

                                 TITLE I--DAIRY

              * * * * * * *

                           Subtitle E--Miscellaneous

              * * * * * * *

                         dairy export incentive program

      Sec. 153. (a) During the period beginning 60 days after the
    date of enactment of this Act and ending on December 31, [2001]
    2002, the Commodity Credit Corporation shall establish and
    operate an export incentive program as described in this
    section for dairy products under section 5 of the Commodity
    Credit Corporation Charter Act.
      (b) The program established under subsection (a) shall
    provide for the Corporation to make payments, on a bid basis,
    to an entity that sells for export United States dairy
    products. The Secretary shall have sole discretion to accept or
    reject bids under such criteria as the Secretary deems
    appropriate.
      (c) The program shall be operated under such rules and
    regulations issued by the Secretary as the Secretary deems
    necessary to ensure, among other things, that--
              (1) payments may be made under the program only on
            the quantity of dairy products sold by an entity for
            export in any year that is in addition to, and not in
            place of, any export sales of dairy products that the
            entity would otherwise make in the absence of the
            program; [and]
              (2) to the extent practicable, dairy products sold
            for export under the program will not displace
            commercial export sales of United States dairy products
            by other exporters[.]; and
              (3) the maximum volume of dairy product exports
            allowable consistent with the obligations of the United
            States as a member of the World Trade Organization are
            exported under the program each year (minus the volume
            sold under section 1163 of this Act (7 U.S.C. 1731
            note) during that year), except to the extent that the
            export of such a volume under the program would, in the
            judgment of the Secretary, exceed the limitations on
            the value set forth in subsection (f); and
              (4) payments may be made under the program for
            exports to any destination in the world for the purpose
            of market development, except a destination in a
            country with respect to which shipments from the United
            States are otherwise restricted by law.
              * * * * * * *
      (e)(1) The payments made under the program shall be made at a
    rate or rates established or approved by the Secretary, taking
    into consideration, among other things the type of product to
    be exported, the domestic price of dairy products, [and] the
    world price of the dairy products, and any additional amount
    that may be required to assist in the development of world
    markets for United States dairy products.
      (2) Any such rate established or approved by the Secretary
    shall be published in the Federal Register or publicly
    announced through other appropriate means, and shall be at a
    level or levels as will encourage the exportation of United
    States dairy products by entities.
      (f) Required Funding.--The Commodity Credit Corporation shall
    in each year use money and commodities for the program under
    this section in the maximum amount consistent with the
    obligations of the United States as a member of the World Trade
    Organization, minus the amount expended under section 1163 of
    this Act (7 U.S.C. 1731 note) during that year. However, the
    Commodity Credit Corporation may not exceed the limitations
    specified in subsection (c)(3) on the volume of allowable dairy
    product exports.
              * * * * * * *

                     TITLE X--GENERAL COMMODITY PROVISIONS

              * * * * * * *

                 Subtitle A--Miscellaneous Commodity Provisions

              * * * * * * *

                              PAYMENT LIMITATIONS

      Sec. 1001. Notwithstanding any other provision of law:
      [(1)(A) Subject to sections 1001A through 1001C for each of
    the 1987 through 1997 crops, the total amount of deficiency
    payments (excluding any deficiency payments described in
    paragraph (2)(B)(iv) of this section) and land diversion
    payments that a person shall be entitled to receive under one
    or more of the annual programs established under the
    Agricultural Act of 1949 (7 U.S.C. 1421 et seq.) for wheat,
    feed grains, upland cotton, extra long staple cotton, and rice
    may not exceed $50,000.
      [(B) Subject to sections 1001A through 1001C for each of the
    1991 through 1997 crops, the total amount of payments specified
    in clauses (iii), (iv), and (v) of paragraph (2)(B) that a
    person shall be entitled to receive under one or more of the
    annual programs established under the Agricultural Act of 1949
    (7 U.S.C. 1421 et seq.) for wheat, feed grains, upland cotton,
    rice, and oilseeds (as defined in section 205(a) of the
    Agricultural Act of 1949) may not exceed $75,000.
      [(2)(A) Subject to sections 1001A through 1001C for each of
    the 1991 through 1997 crops, the total amount of payments set
    forth in subparagraph (B) that a person shall be entitled to
    receive under one or more of the annual programs established
    under the Agricultural Act of 1949 for wheat, feed grains,
    upland cotton, extra long staple cotton, rice, and other
    commodities, when combined with payments for such crop
    described in paragraph (1), shall not exceed $250,000.
      [(B) As used in subparagraph (A), the term ``payments''
    means--
              [(i) any part of any payment that is determined by
            the Secretary of Agriculture to represent compensation
            for resource adjustment (excluding land diversion
            payments) or public access for recreation;
              [(ii) any disaster payment under one or more of the
            annual programs for a commodity established under the
            Agricultural Act of 1949;
              [(iii) any gain realized by a producer from repaying
            a loan for a crop of any commodity (other than honey)
            at a lower level than the original loan level
            established under the Agricultural Act of 1949;
              [(iv) any deficiency payment received for a crop of
            wheat or feed grains under section 107B(c)(1) or
            105B(c)(1), respectively, of the Agricultural Act of
            1949 as the result of a reduction of the loan level for
            such crop under section 107B(a)(3) or 105B(a)(3) of
            such Act;
              [(v) any loan deficiency payment received for a crop
            of wheat, feed grains, upland cotton, rice, or oilseeds
            under section 107B(b), 105B(b), 103B(b), 101B(b), or
            205(e), respectively, of the Agricultural Act of 1949;
            and
              [(vi) any inventory reduction payment received for a
            crop of wheat, feed grains, upland cotton, or rice
            under section 107B(f), 105B(f), 103B(f), or 101B(f),
            respectively, of the Agricultural Act of 1949.
    Such term shall not include loans or purchases, except as
    specifically provided for in this paragraph.
      [(C) No certificate redeemable for stocks of a commodity held
    by the Commodity Credit Corporation may be redeemed for honey
    held by the Corporation.
      [(3) Notwithstanding the foregoing provisions of this
    section, if the Secretary of Agriculture determines that any of
    the limitations provided for in paragraph (2) will result in a
    substantial increase in the number or dollar amount of loan
    forfeitures for a crop of a commodity, will substantially
    reduce the acreage taken out of production under an acreage
    reduction program for a crop of a commodity, or will cause the
    market prices for a crop of a commodity to fall substantially
    below the effective loan rate for the crop, the Secretary shall
    adjust upward such limitation, under such terms and conditions
    as the Secretary determines appropriate, as necessary to
    eliminate such adverse effect on the program involved.
      [(4) If the Secretary determines that the total amount of
    payments that will be earned by any person under the program in
    effect for any crop will be reduced under this section, any
    acreage requirement established under a set-aside or acreage
    limitation program for the farm or farms on which such person
    will be sharing in payments earned under such program shall be
    adjusted to such extent and in such manner as the Secretary
    determines will be fair and reasonable in relation to the
    amount of the payment reduction.]
              (1) Limitation on payments under production
            flexibility contracts.--The total amount of contract
            payments made under section 103 of the Agricultural
            Market Transition Act to a person under 1 or more
            production flexibility contracts entered into under the
            section during any fiscal year may not exceed $40,000.
              (2) Limitation on marketing loan gains and loan
            deficiency payments.--For each of the 1996 through 2002
            crops of loan commodities, the total amount of payments
            specified in paragraph (3) that a person shall be
            entitled to receive under section 104 of the
            Agricultural Market Transition Act for one or more loan
            commodities may not exceed $75,000.
              (3) Description of payments subject to limitation.--
            The payments referred to in paragraph (2) are the
            following:
                      (A) Any gain realized by a producer from
                    repaying a marketing assistance loan for a crop
                    of any loan commodity at a lower level than the
                    original loan rate established for the loan
                    commodity under section 104(b) of the
                    Agricultural Market Transition Act.
                      (B) Any loan deficiency payment received for
                    a loan commodity under section 104(e) of the
                    Act.
              (4) Definitions.--In this title, the terms ``contract
            payment'' and ``loan commodity'' have the meaning given
            those terms in section 102 of the Agricultural Market
            Transition Act.
              * * * * * * *

    SEC. 1001A. PREVENTION OF CREATION OF ENTITIES TO QUALIFY AS SEPARATE
                        PERSONS; PAYMENTS LIMITED TO ACTIVE FARMERS.

      (a) Prevention of Creation of Entities To Qualify as Separate
    Persons.--For the purposes of preventing the use of multiple
    legal entities to avoid the effective application of the
    payment limitations under section 1001:
              (1) In general.--A person (as defined in section
            1001(5)(B)(i)) that receives farm program payments (as
            described in paragraphs (1) and (2) of this section as
            being subject to limitation) for a crop year [under the
            Agricultural Act of 1949 (7 U.S.C. 1421 et seq.)] may
            not also hold, directly or indirectly, substantial
            beneficial interests in more than two entities (as
            defined in section 1001(5)(B)(i)(II)) engaged in farm
            operations that also receive such payments as separate
            persons, for the purposes of the application of the
            limitations under section 1001. A person that does not
            receive such payments for a crop year may not hold,
            directly or indirectly, substantial beneficial
            interests in more than three entities that receive such
            payments as separate persons, for the purposes of the
            application of the limitations under section 1001.
              * * * * * * *
      (b) Payments Limited to Active Farmers.--
              (1) In general.--To be separately eligible for farm
            program payments (as described in paragraphs (1) and
            (2) of section 1001 as being subject to limitation)
            [under the Agricultural Act of 1949] with respect to a
            particular farming operation (whether in the person's
            own right or as a partner in a general partnership, a
            grantor of a revocable trust, a participant in a joint
            venture, or a participant in a similar entity (as
            determined by the Secretary) that is the producer of
            the crops involved), a person must be an individual or
            entity described in section 1001(5)(B)(i) and actively
            engaged in farming with respect to such operation, as
            provided under paragraphs (2), (3), and (4).
              * * * * * * *

    SEC. 1001C. FOREIGN PERSONS MADE INELIGIBLE FOR PROGRAM BENEFITS.

      Notwithstanding any other provision of law:
      (a) In General.--[For each of the 1991 through 1997 crops,
    any] Any person who is not a citizen of the United States or an
    alien lawfully admitted into the United States for permanent
    residence under the Immigration and Nationality Act (8 U.S.C.
    1101 et seq.) shall be ineligible to receive any type of
    [production adjustment payments, price support program loans,
    payments, or benefits made available under the Agricultural Act
    of 1949 (7 U.S.C. 1421 et seq.),] loans or payments made
    available under title I of the Agricultural Market Transition
    Act, the Commodity Credit Corporation Charter Act (15 U.S.C.
    714 et seq.), or subtitle D of title XII of the Food Security
    Act of 1985 (16 U.S.C. 3831 et seq.), or under any contract
    entered into under title XII [during the 1989 through 1997 crop
    years], with respect to any commodity produced, or land set
    aside from production, on a farm that is owned or operated by
    such person, unless such person is an individual who is
    providing land, capital, and a substantial amount of personal
    labor in the production of crops on such farm.
              * * * * * * *

                                TITLE XI--TRADE

         Subtitle A--Public Law 480 and Use of Surplus Commodities in
                             International Programs

              * * * * * * *
      Sec. 1110. (a)  * * *
              * * * * * * *
      (k) This section shall be effective during the period
    beginning October 1, 1985, and ending December 31, [1995] 1996.
      (l)(1) To enhance the development of private sector
    agriculture in countries receiving assistance under this
    section the President may, in each of the fiscal years 1991
    through [1995] 1996, use in addition to any amounts or
    commodities otherwise made available under this section for
    such activities, not to exceed $10,000,000 of Commodity Credit
    Corporation funds (or commodities of an equal value owned by
    the Corporation), to provide assistance in the administration,
    sale, and monitoring of food assistance programs to strengthen
    private sector agriculture in recipient countries.
              * * * * * * *

                            TITLE XII--CONSERVATION

              * * * * * * *

            Subtitle D--Agricultural Resources Conservation Program

         CHAPTER 1--ENVIRONMENTAL CONSERVATION ACREAGE RESERVE PROGRAM

              * * * * * * *

                       Subchapter B--Conservation Reserve

    SEC. 1231. CONSERVATION RESERVE.

      (a)  * * *
              * * * * * * *
      (d) Maximum Enrollment.--The Secretary shall enter into
    contracts under this section to place in the conservation
    reserve a [total of 38,000,000 acres during the 1986 through
    1995 calendar years. In enrolling such acres, the Secretary
    shall reserve 1 million acres for enrollment under this section
    in the 1995 calendar year.] total of 36,400,000 acres.
              * * * * * * *

                     Subchapter C--Wetlands Reserve Program

    SEC. 1237. WETLANDS RESERVE PROGRAM.

      (a)  * * *
      (b) Minimum Enrollment.--The Secretary shall enroll into the
    wetlands reserve program--
              (1)  * * *
              (2) a total of [not less] not more than 975,000 acres
            during the 1991 through [2000] 2002 calendar years.
      (c) Eligibility.--For purposes of enrolling land in the
    wetland reserve established under this subchapter during the
    1991 through [2000] 2002 calendar years, land shall be eligible
    to be placed into such reserve if the Secretary, in
    consultation with the Secretary of the Interior at the local
    level, determines that--
              (1)  * * *
              * * * * * * *

    SEC. 1237A. EASEMENTS.

      (a)  * * *
              * * * * * * *
      (e) Type and Length of Easement.--A conservation easement
    granted under this section--
              (1) shall be in a recordable form; and
              [(2) shall be for 30 years, permanent, or the maximum
            duration allowed under applicable State laws.]
              (2) shall be for 15 years, but in no case shall be a
            permanent easement.
              * * * * * * *

             CHAPTER 4--LIVESTOCK ENVIRONMENTAL ASSISTANCE PROGRAM

    SEC. 1240. DEFINITIONS.

      In this chapter:
              (1) Land management practice.--The term ``land
            management practice'' means a site-specific nutrient or
            manure management, irrigation management, tillage or
            residue management, grazing management, or other land
            management practice that the Secretary determines is
            needed to protect, in the most cost effective manner,
            water, soil, or related resources from degradation due
            to livestock production.
              (2) Large confined livestock operation.--The term
            ``large confined livestock operation'' means an
            operation that--
                      (A) is a confined animal feeding operation;
                    and
                      (B) has more than--
                              (i) 55 mature dairy cattle;
                              (ii) 10,000 beef cattle;
                              (iii) 30,000 laying hens or broilers
                            (if the facility has continuous
                            overflow watering);
                              (iv) 100,000 laying hens or broilers
                            (if the facility has a liquid manure
                            system);
                              (v) 55,000 turkeys;
                              (vi) 15,000 swine; or
                              (vii) 10,000 sheep or lambs.
              (3) Livestock.--The term ``livestock'' means dairy
            cows, beef cattle, laying hens, broilers, turkeys,
            swine, sheep, lambs, and such other animals as
            determined by the Secretary.
              (4) Operator.--The term ``operator'' means a person
            who is engaged in livestock production (as defined by
            the Secretary).
              (5) Structural practice.--The term ``structural
            practice'' means the establishment of an animal waste
            management facility, terrace, grassed waterway, contour
            grass strip, filterstrip, or other structural practice
            that the Secretary determines is needed to protect, in
            the most cost effective manner, water, soil, or related
            resources from degradation due to livestock production.

    SEC. 1240A. ESTABLISHMENT AND ADMINISTRATION OF LIVESTOCK ENVIRONMENTAL
                        ASSISTANCE PROGRAM.

      (a) Establishment.--
              (1) In general.--During the 1996 through 2002 fiscal
            years, the Secretary shall provide technical
            assistance, cost-sharing payments, and incentive
            payments to operators who enter into contracts with the
            Secretary, through a livestock environmental assistance
            program.
              (2) Eligible practices.--
                      (A) Structural practices.--An operator who
                    implements a structural practice shall be
                    eligible for technical assistance or cost-
                    sharing payments, or both.
                      (B) Land management practices.--An operator
                    who performs a land management practice shall
                    be eligible for technical assistance or
                    incentive payments, or both.
              (3) Eligible land.--Assistance under this chapter may
            be provided with respect to land that is used for
            livestock production and on which a serious threat to
            water, soil, or related resources exists, as determined
            by the Secretary, by reason of the soil types, terrain,
            climatic, soil, topographic, flood, or saline
            characteristics, or other factors or natural hazards.
              (4) Selection criteria.--In providing technical
            assistance, cost-sharing payments, and incentive
            payments to operators in a region, watershed, or
            conservation priority area in which an agricultural
            operation is located, the Secretary shall consider--
                      (A) the significance of the water, soil, and
                    related natural resource problems; and
                      (B) the maximization of environmental
                    benefits per dollar expended.
      (b) Application and Term.--
              (1) In general.--A contract between an operator and
            the Secretary under this chapter may--
                      (A) apply to 1 or more structural practices
                    or 1 or more land management practices, or
                    both; and
                      (B) have a term of not less than 5, nor more
                    than 10, years, as determined appropriate by
                    the Secretary, depending on the practice or
                    practices that are the basis of the contract.
              (2) Duties of operators and secretary.--To receive
            cost-sharing or incentive payments, or technical
            assistance, participating operators shall comply with
            all terms and conditions of the contract and a plan, as
            established by the Secretary.
      (c) Structural Practices.--
              (1) Competitive offer.--The Secretary shall
            administer a competitive offer system for operators
            proposing to receive cost-sharing payments in exchange
            for the implementation of 1 or more structural
            practices by the operator. The competitive offer system
            shall consist of--
                      (A) the submission of a competitive offer by
                    the operator in such manner as the Secretary
                    may prescribe; and
                      (B) evaluation of the offer in light of the
                    selection criteria established under subsection
                    (a)(4) and the projected cost of the proposal,
                    as determined by the Secretary.
              (2) Concurrence of owner.--If the operator making an
            offer to implement a structural practice is a tenant of
            the land involved in agricultural production, for the
            offer to be acceptable, the operator shall obtain the
            concurrence of the owner of the land with respect to
            the offer.
      (d) Land Management Practices.--The Secretary shall establish
    an application and evaluation process for awarding technical
    assistance or incentive payments, or both, to an operator in
    exchange for the performance of 1 or more land management
    practices by the operator.
      (e) Cost-Sharing, Incentive Payments, and Technical
    Assistance.--
              (1) Cost-sharing payments.--
                      (A) In general.--The Federal share of cost-
                    sharing payments to an operator proposing to
                    implement 1 or more structural practices shall
                    not be greater than 75 percent of the projected
                    cost of each practice, as determined by the
                    Secretary, taking into consideration any
                    payment received by the operator from a State
                    or local government.
                      (B) Limitation.--An operator of a large
                    confined livestock operation shall not be
                    eligible for cost-sharing payments to construct
                    an animal waste management facility.
                      (C) Other payments.--An operator shall not be
                    eligible for cost-sharing payments for
                    structural practices on eligible land under
                    this chapter if the operator receives cost-
                    sharing payments or other benefits for the same
                    land under chapter 1, 2, or 3.
              (2) Incentive payments.--The Secretary shall make
            incentive payments in an amount and at a rate
            determined by the Secretary to be necessary to
            encourage an operator to perform 1 or more land
            management practices.
              (3) Technical assistance.--
                      (A) Funding.--The Secretary shall allocate
                    funding under this chapter for the provision of
                    technical assistance according to the purpose
                    and projected cost for which the technical
                    assistance is provided for a fiscal year. The
                    allocated amount may vary according to the type
                    of expertise required, quantity of time
                    involved, and other factors as determined
                    appropriate by the Secretary. Funding shall not
                    exceed the projected cost to the Secretary of
                    the technical assistance provided for a fiscal
                    year.
                      (B) Other authorities.--The receipt of
                    technical assistance under this chapter shall
                    not affect the eligibility of the operator to
                    receive technical assistance under other
                    authorities of law available to the Secretary.
      (f) Limitation on Payments.--
              (1) In general.--The total amount of cost-sharing and
            incentive payments paid to a person under this chapter
            may not exceed--
                      (A) $10,000 for any fiscal year; or
                      (B) $50,000 for any multiyear contract.
              (2) Regulations.--The Secretary shall issue
            regulations that are consistent with section 1001 for
            the purpose of--
                      (A) defining the term ``person'' as used in
                    paragraph (1); and
                      (B) prescribing such rules as the Secretary
                    determines necessary to ensure a fair and
                    reasonable application of the limitations
                    established under this subsection.
      (g) Regulations.--Not later than 180 days after the effective
    date of this subsection, the Secretary shall issue regulations
    to implement the livestock environmental assistance program
    established under this chapter.

                          [Subtitle E--Administration

                      [USE OF COMMODITY CREDIT CORPORATION

      [Sec. 1241. (a)(1) During each of the fiscal years ending
    September 30, 1986, and September 30, 1987, the Secretary shall
    use the facilities, services, authorities, and funds of the
    Commodity Credit Corporation to carry out subtitle D.
      [(2) During the fiscal year ending September 30, 1988, and
    each fiscal year thereafter, the Secretary may use the
    facilities, services, authorities, and funds of the Commodity
    Credit Corporation to carry out subtitle D, except that the
    Secretary may not use funds of the Corporation for such purpose
    unless the Corporation has received funds to cover such
    expenditures from appropriations made to carry out this
    subtitle.
      [(b) The authority provided by subtitles (A) through (E)
    shall be in addition to, and not in place of, other authority
    granted to the Secretary and the Commodity Credit Corporation.

                             [USE OF OTHER AGENCIES

      [Sec. 1242. (a) In carrying out subtitles B, C, and D, the
    Secretary shall use the services of local, county, and State
    committees established under section 8(b) of the Soil
    Conservation and Domestic Allotment Act (16 U.S.C. 590h(b)).
      [(b)(1) In carrying out subtitle D, the Secretary may utilize
    the services of the Soil Conservation Service and the Forest
    Service, the Fish and Wildlife Service, State forestry
    agencies, State fish and game agencies, land-grant colleges,
    local, county, and State committees established under section
    8(b) of the Soil Conservation and Domestic Allotment Act (16
    U.S.C. 590h), soil and water conservation districts, and other
    appropriate agencies.
      [(2) In carrying out subtitle D at the State and county
    levels, the Secretary shall consult with, to the extent
    practicable, the Fish and Wildlife Service, State forestry
    agencies, State fish and game agencies, land-grant colleges,
    soil-conservation districts, and other appropriate agencies.

                                [ADMINISTRATION

      [Sec. 1243. (a) The Secretary shall establish, by regulation,
    an appeal procedure under which a person who is adversely
    affected by any determination made under subtitles A through E
    may seek review of such determination.
      [(b) Ineligibility under section 1211 or 1212 of a tenant or
    sharecropper for benefits shall not cause a landlord to be
    ineligible for benefits for which the landlord would otherwise
    be eligible with respect to commodities produced on lands other
    than those operated by the tenant or sharecropper.
      [(c) In carrying out subtitles B through E, the Secretary
    shall provide adequate safeguards to protect the interests of
    tenants and sharecroppers, including provision for sharing, on
    a fair and equitable basis, in payments under the program
    established by subtitle D.
      [(d) In making determinations under this title and in
    conducting appeals from any determination made under this
    title, the Secretary shall act as expeditiously as possible but
    shall provide adequate safeguards to protect the interests of
    the persons involved in such determination.
      [(e) The Secretary shall maintain data concerning the number
    and status of appeals pending in excess of 120 days or resolved
    under this title.
      [(f)(1) The Secretary shall not enroll more than a total of
    25 percent of the cropland in any county into the Environmental
    Conservation Acreage Reserve Program under chapter 1 and the
    Environmental Easement Program under chapter 3, and not more
    than 10 percent of such cropland may be subject to an easement
    acquired under those chapters. The Secretary may exceed these
    limitations in a county to the extent that the Secretary
    determines that--
              [(A) such action would not adversely affect the local
            economy of such county; and
              [(B) producers in such county are having difficulties
            complying with conservation plans or other
            environmental requirements.
      [(2) The limitations established under this subsection shall
    not apply to cropland that is subject to an easement under
    chapter 1 or chapter 3 that is used for the establishment of
    shelterbelts and windbreaks.
      [(3) In making a determination under this subsection, the
    Secretary shall not require the written consent of a member of
    Congress.

                                  [REGULATIONS

      [Sec. 1244. Not later than 180 days after the date of
    enactment of this Act, the Secretary shall issue such
    regulations as the Secretary determines are necessary to carry
    out subtitles A through E, including regulations that--
              [(1) define the term ``person'';
              [(2) govern the determination of persons who shall be
            ineligible for program benefits under subtitles B and
            C, so as to ensure a fair and reasonable determination
            of ineligibility; and
              [(3) protect the interests of landlords, tenants, and
            sharecroppers.

    [SEC. 1245. AUTHORIZATION OF APPROPRIATIONS.

      [(a) Environmental Conservation Acreage Reserve Program and
    Water Quality Incentive Program.--There is authorized to be
    appropriated without fiscal year limitation such sums as may be
    necessary to carry out chapters 1 and 2 of subtitle D. Amounts
    available to carry out subtitle D before the date of enactment
    of this section shall remain available to carry out such
    chapters.
      [(b) Other Conservation Matters.--In addition to subsection
    (a), there is authorized to be appropriated without fiscal year
    limitation such sums as may be necessary to carry out subtitles
    A through G, other than chapters 1 and 2 of subtitle D.

    [SEC. 1246. MONITORING AND EVALUATION.

      [(a) In General.--Not later than June 30, 1993, the Secretary
    shall prepare and submit, to the Committee on Agriculture of
    the House of Representatives and the Committee on Agriculture,
    Nutrition, and Forestry of the Senate, a comprehensive report
    that evaluates, in accordance with subsection (b), the programs
    and policies established and operated under this title.
      [(b) Requirements.--In conducting the evaluations required
    under subsection (a), the Secretary shall--
              [(1) assess the progress made toward the national
            objective of nondegradation of the soil resources
            through the implementation of the relevant provisions
            of this title, identify obstacles to the attainment of
            such goal, and recommend ways in which to overcome such
            obstacles;
              [(2) perform on-site evaluations of 5 percent, or
            such reasonable amount as necessary to produce a
            statistically valid survey, of all affected acreage
            of--
                      [(A) conservation practices on highly
                    erodible lands;
                      [(B) estimates of erosion reductions that may
                    result from the implementation of conservation
                    plans; and
                      [(C) the technical adequacy and feasibility
                    of such plans;
              [(3) collect data concerning the social and economic
            impacts, violations, appeals, and such other matters
            under this title as the Secretary determines to be
            necessary to assess the overall impact of this title,
            which data collection shall not impose an additional
            recordkeeping or reporting requirement on the producer;
            and
              [(4) assess the contribution toward the national
            objectives of wetlands preservation, wildlife and
            waterfowl habitat improvement, and water quality
            improvement through the implementation of the relevant
            provisions of this title, identify obstacles to
            furthering progress toward such objectives, and
            recommend ways in which to overcome such obstacles.

    [SEC. 1247. ASSISTANCE FOR CONTROL OF THE SPREAD OF WEEDS AND PESTS.

      [(a) In General.--The Secretary, in consultation with State
    experiment stations, the Administrator of the Extension
    Service, the Chief of the Soil Conservation Service, and State
    pest and weed control boards, shall make available to owners
    and operators of land that is subject to a contract under
    subtitle D, weed and pest control technical information and
    materials that--
              [(1) address common weed and pest problems and
            programs to control weeds and pests found on acreage
            enrolled in the conservation reserve; and
              [(2) are otherwise consistent with maintaining the
            conservation and environmental objectives of the
            conservation reserve.
      [(b) Conservation Measure.--At the Secretary's discretion,
    the control of insect pests on conservation reserve acreage
    that is most likely to incur a crop pest infestation that
    adversely affects surrounding commercial land may be considered
    a conservation measure or practice for the purposes of section
    1234(b).]

                              Subtitle E--Funding

    SEC. 1241. FUNDING.

      (a) Mandatory Expenses.--For each of fiscal years 1996
    through 2002, the Secretary shall use the funds of the
    Commodity Credit Corporation to carry out the programs
    authorized by--
              (1) subchapter B of chapter 1 of subtitle D
            (including contracts extended by the Secretary pursuant
            to section 1437 of the Food, Agriculture, Conservation,
            and Trade Act of 1990 (Public Law 101-624; 16 U.S.C.
            3831 note));
              (2) subchapter C of chapter 1 of subtitle D; and
              (3) chapter 4 of subtitle D.
      (b) Livestock Environmental Assistance Program.--For each of
    fiscal years 1996 through 2002, $100,000,000 of the funds of
    the Commodity Credit Corporation shall be available for
    providing technical assistance, cost-sharing payments, and
    incentive payments for practices relating to livestock
    production under the livestock environmental assistance program
    under chapter 4 of subtitle D.
              * * * * * * *
                                  ----------

                      AGRICULTURAL ADJUSTMENT ACT OF 1938

              * * * * * * *

       TITLE III--LOANS, PARITY PAYMENTS, CONSUMER SAFEGUARDS, MARKETING
                       QUOTAS, AND MARKETING CERTIFICATES

       Subtitle A--Definitions, Parity Payments, and Consumer Safeguards

                                  DEFINITIONS

      Sec. 301. (a) * * *
      (b) Definitions Applicable to One or More Commodities.--For
    the purposes of this title--
              (1) * * *
              * * * * * * *
              (18) The word ``peanuts'' for the purposes of this
            Act shall mean all peanuts produced, excluding any
            peanuts which it is established by the producer or
            otherwise, in accordance with regulations of the
            Secretary, were not picked or threshed either before or
            after marketing from the farm, or were marketed by the
            producer before drying or removal of moisture from such
            peanuts either by natural or artificial means for
            consumption exclusively as boiled peanuts.
              * * * * * * *

                      international emergency food reserve

      Sec. 305. The President is encouraged to enter into
    negotiations with other nations to develop an international
    system of food reserves to provide for humanitarian food relief
    needs and to establish and maintain a food reserve, as a
    contribution of the United States toward the development of
    such a system, to be made available in the event of food
    emergencies in foreign countries. The reserves shall be known
    as the International Emergency Food Reserve.
              * * * * * * *

                          Subtitle B--Marketing Quotas

                       PART I--MARKETING QUOTAS--TOBACCO

              * * * * * * *
      Sec. 315. Notwithstanding any of the provisions of section
    101 of this Act: (a) For the 1960 crop of any kind of tobacco
    for which marketing quotas are in effect, or for which
    marketing quotas are not disapproved by producers, the support
    level in cents per pound shall be the level at which the 1959
    crop of such kind of tobacco was supported, or if marketing
    quotas were disapproved for the 1959 crop of such kind of
    tobacco, the level at which the 1959 crop of such kind of
    tobacco would have been supported if marketing quotas had been
    in effect. (b) For the 1961 crop and each subsequent crop of
    any kind of tobacco for which marketing quotas are in effect,
    or for which marketing quotas are not disapproved by producers,
    the support level in cents per pound shall be determined by
    adjusting the support level for the 1959 crop of such kind of
    tobacco, or if marketing quotas were disapproved for the 1959
    crop of such kind of tobacco, the level at which the 1959 crop
    of such kind of tobacco would have been supported if marketing
    quotas had been in effect, by multiplying such support level
    for the 1959 crop by the ratio of (i) the average of the index
    of prices paid by farmers, including wage rates, interest, and
    taxes, as defined in section 301(a)(1)(C) of the Agricultural
    Adjustment Act of 1938, as amended, for the three calendar
    years immediately preceding the calendar year in which the
    marketing year begins for the crop for which the support level
    is being determined to (ii) the average index of such prices
    paid by farmers, including wage rates, interest, and taxes for
    the calendar year 1959.
      (c) If acreage poundage or poundage farm marketing quotas are
    in effect under section 317 or 319 of the Agricultural
    Adjustment Act of 1938, as amended, (1) price support shall not
    be made available on tobacco marketed in excess of 103 per
    centum of the marketing quota (after adjustments) for the farm
    on which such tobacco was produced, and (2) for the purpose of
    price-support eligibility, tobacco carried over from one
    marketing year to another shall, when marketed, be considered
    tobacco of the then current crop.
      (d) Notwithstanding the provisions of section 403, if the
    Secretary determines that the supply of any grade of any kind
    of tobacco of a crop for which marketing quotas are in effect
    or are not disapproved by producers will likely be excessive,
    the Secretary, after prior consultation with the association
    through which price support for the grade and kind of tobacco
    is made available to producers, may reduce the support rate
    which would otherwise be established for such grade of tobacco
    after taking into consideration the effect such reduction may
    have on the supply and price of other grades of other kinds of
    quota tobacco: Provided, That the weighted average of the
    support rates for all eligible grades of such kind of tobacco
    shall, after such reduction, reflect not less than (1) 65 per
    centum of the increase in the support level for such kind of
    tobacco which would otherwise be established under this
    section, if the support level therefor is higher than the
    support level for the preceding crop, or (2) the support level
    for such kind of tobacco established under this section, if the
    support level therefor is not higher than the support level for
    the preceding crop. In determining whether the supply of any
    grade of any kind of tobacco of a crop will be excessive, the
    Secretary shall take into consideration the domestic supply,
    including domestic inventories, the amount of such tobacco
    pledged as security for price support loans, and anticipated
    domestic and export demand, based on the maturity, uniformity
    and stalk position of such tobacco.
      (f) Notwithstanding the foregoing provisions of this
    section--
              (1) For the 1984 crop of Flue-cured tobacco, the
            support level shall be the level in cents per pound at
            which the 1982 crop was supported.
              (2) For the 1985 crop of Flue-cured tobacco, the
            support level shall be the level in cents per pound at
            which the 1982 crop was supported, plus or minus,
            respectively, the amount by which (A) the support level
            for the 1985 crop, as determined under subsection (b),
            is greater or less than (B) the support level for the
            1984 crop, as determined under subsection (b), as that
            difference may be adjusted by the Secretary under
            subsection (d) if the support level under clause (A) is
            greater than the support level under clause (B), except
            that the support level for the 1985 crop shall be the
            level in cents per pound at which the 1982 crop was
            supported if the support level as determined under
            subsection (b) for the 1985 crop would not be more than
            5 per centum greater than the support level as
            determined under subsection (b) for the 1984 crop.
              (3) For the 1984 crop of any kind of tobacco (other
            than Flue-cured tobacco) for which marketing quotas are
            in effect or are not disapproved by producers and for
            the 1985 crop of any kind of tobacco (other than Flue-
            cured and Burley tobacco) for which marketing quotas
            are in effect or are not disapproved by producers, the
            Secretary shall establish the support level at such
            level as will not narrow the normal price support
            differential between Flue-cured tobacco and such other
            kind of tobacco. Before establishing the support level
            under this paragraph for any such kind of tobacco the
            Secretary shall publish in the Federal Register a
            notice of the level the Secretary proposes to establish
            and give an opportunity for the public to comment on
            the proposal. In determining the level to be
            established under this paragraph for a particular kind
            of tobacco, the Secretary shall take into consideration
            the cost of producing such kind of tobacco, the supply
            and demand conditions for such kind of tobacco, the
            comments received in response to the public notice of
            the proposal, and such other relevant factors as the
            Secretary determines appropriate.
              (4) For the 1985 and 1986 crops of Burley tobacco,
            the support level shall be $1.488 per pound.
              (5) For the 1986 crop of Flue-cured tobacco, the
            support level shall be $1.438 per pound.
              (6)(A) Except as provided in subparagraph (B), for
            the 1986 and each subsequent crop of any kind of
            tobacco (other than Flue-cured and Burley tobacco) for
            which marketing quotas are in effect or are not
            disapproved by producers, the support level shall be
            the level in cents per pound at which the immediately
            preceding crop was supported, plus or minus,
            respectively, the amount by which--
                      (i) the support level for the crop for which
                    the determination is being made, as determined
                    under subsection (b); is greater or less than
                      (ii) the support level for the immediately
                    preceding crop, as determined under subsection
                    (b),
            as that difference may be adjusted by the Secretary
            under subsection (d) if the support level under clause
            (i) is greater than the support level under clause
            (ii).
              (B) Notwithstanding subparagraph (A) and subsection
            (d), if requested by the board of directors of an
            association through which price support for the
            respective kind of tobacco specified in subparagraph
            (A) is made available to producers, the Secretary may
            reduce the support level for such kind of tobacco to
            the extent requested by the association to more
            accurately reflect the market value and improve the
            marketability of such tobacco.
              (7)(A) For the 1987 and each subsequent crop of Flue-
            cured and Burley tobacco for which marketing quotas are
            in effect or are not disapproved by producers, the
            support level shall be the level in cents per pound at
            which the immediately preceding crop was supported,
            plus or minus, respectively, an adjustment of not less
            than 65 percent nor more than 100 percent of the total,
            as determined by the Secretary after taking into
            consideration the supply of the kind of tobacco
            involved in relation to demand, of--
                      (i) 66.7 percent of the amount by which--
                              (I) the average price received by
                            producers for Flue-cured and Burley
                            tobacco, respectively, on the United
                            States auction markets, as determined
                            by the Secretary, during the 5
                            marketing years immediately preceding
                            the marketing year for which the
                            determination is being made, excluding
                            the year in which the average price was
                            the highest and the year in which the
                            average price was the lowest in such
                            period, is greater or less than
                              (II) the average price received by
                            producers for Flue-cured and Burley
                            tobacco, respectively, on the United
                            States auction markets, as determined
                            by the Secretary, during the 5
                            marketing years immediately preceding
                            the marketing year prior to the
                            marketing year for which the
                            determination is being made, excluding
                            the year in which the average price was
                            the highest and the year in which the
                            average price was the lowest in such
                            period; and
                      (ii) 33.3 percent of the change, expressed as
                    a cost per pound of tobacco, in the index of
                    prices paid by tobacco producers from January 1
                    to December 31 of the calendar year immediately
                    preceding the year in which the determination
                    is made.
              (B) For purposes of subparagraph (A)--
                      (i) the average market price for Burley
                    tobacco for the 1985 marketing year shall be
                    reduced by $0.039 per pound;
                      (ii) the average market price for Burley
                    tobacco for the 1984 and each prior applicable
                    marketing year shall be reduced by $0.30 per
                    pound;
                      (iii) the average market price for Flue-cured
                    tobacco for the 1985 marketing year shall be
                    reduced by $0.25 per pound;
                      (iv) the average market price for Flue-cured
                    tobacco for the 1984 and each prior applicable
                    marketing year shall be reduced by $0.30 per
                    pound; and
                      (v) the index of prices paid by tobacco
                    producers shall include items representing
                    general, variable costs of producing tobacco,
                    as determined by the Secretary, but shall not
                    include the cost of land, risk, overhead,
                    management, purchase or leasing of quotas,
                    marketing contributions or assessments, and
                    other costs not directly related to the
                    production of tobacco.
              (8)(A) Notwithstanding any other provision of this
            subsection, in the case of each of the 1988 and 1989
            crops of any kind of tobacco, the Secretary shall
            reduce the support level for such crop by an amount
            equal to 1.4 percent of the level otherwise established
            under this subsection. Any such reduction shall not be
            taken into consideration in determining the support
            level for a subsequent crop of tobacco.
              (B) In lieu of making any such reduction, the
            Secretary may impose assessments on the producers and
            purchasers in an amount sufficient to realize a
            reduction in outlays equal to the amount that would
            have been achieved as a result of the reduction
            required under subparagraph (A). Such assessments shall
            not apply to purchasers if it is judicially determined
            that the imposition of the purchaser assessment will
            adversely affect the contracts entered into under
            section 1109 of the Consolidated Omnibus Budget
            Reconciliation Act of 1986 (7 U.S.C. 1445-3).
      (g)(1) Effective only for each of the 1994 through 1998 crops
    of tobacco for which price support is made available under this
    Act, each producer and purchaser of such tobacco, and each
    importer of the same kind of tobacco, shall remit to the
    Commodity Credit Corporation a nonrefundable marketing
    assessment in an amount equal to--
                      (A) in the case of a producer or purchaser of
                    domestic tobacco, .5 percent of the national
                    price support level for each such crop; and
                      (B) in the case of an importer of tobacco, 1
                    percent of the national support price for the
                    same kind of tobacco;
            as provided for in this section.
      (2) Such producer, purchaser, and importer assessments shall
    be--
              (A) collected in the same manner as provided for in
            section 106A(d)(2) or 106B(d)(3), as applicable; and
              (B) enforced in the same manner as provided in
            section 106A(h) or 106B(j), as applicable.
      (3) The Secretary may enforce this subsection in the courts
    of the United States.

       producer contributions and purchaser assessments for no net cost
                                  tobacco fund

      Sec. 315A. (a) As used in the section--
              (1) the term ``association'' means a producer-owned
            cooperative marketing association which has entered
            into a loan agreement with the Corporation to make
            price support available to producers;
              (2) the term ``Corporation'' means the Commodity
            Credit Corporation, an agency and instrumentality of
            the United States within the Department of Agriculture
            through which the Secretary makes price support
            available to producers;
              (3) the term ``Fund'' means the capital account to be
            established within each association, which account
            shall be known as the ``No Net Cost Tobacco Fund'';
              (4) the term ``to market'' means to dispose of quota
            tobacco by voluntary or involuntary sale, barter,
            exchange, gift inter vivos, or consigning the tobacco
            to an association for a price support advance;
              (5) the term ``net gains'' means the amount by which
            total proceeds obtained from the sale by an association
            of a crop of quota tobacco pledged to the Corporation
            for price support loan exceeds the principal amount of
            the price support loan made by the Corporation to the
            association on such crop, plus interest and charges;
              (6) the term ``purchaser'' means any person who
            purchases in the United States, either directly or
            indirectly for the account of such person or another
            person, Flue-cured or Burley quota tobacco; and
              (7) the term ``quota tobacco'' means any kind of
            tobacco for which marketing quotas are in effect or for
            which marketing quotas are not disapproved by
            producers.
      (b) The Secretary may carry out the tobacco price support
    program through the Corporation and shall, except as otherwise
    provided by this section, continue to make price support
    available to producers through loans to associations that,
    under agreements with the Corporation, agree to make loan
    advances to producers.
      (c) Each association shall establish within the association a
    Fund. The Fund shall be comprised of amounts contributed by
    producer-members or paid by or on behalf of purchasers and
    importers as provided in subsection (d).
      (d) The Secretary shall--
              (1) require--
                      (A) that--
                              (i) as a condition of eligibility for
                            price support, each producer of each
                            kind of quota tobacco shall agree, with
                            respect to all such kind of quota
                            tobacco marketed by the producer from a
                            farm, to contribute to the appropriate
                            association, for deposit in the
                            association's Fund, an amount
                            determined from time to time by the
                            association with the approval of the
                            Secretary;
                              (ii) each purchaser of Flue-cured and
                            Burley quota tobacco shall pay to the
                            appropriate association, for deposit in
                            the Fund of the association, an
                            assessment, in an amount determined
                            from time to time by the association
                            with the approval of the Secretary,
                            with respect to purchases of all such
                            kind of tobacco marketed by a producer
                            from a farm (including purchases of
                            such tobacco from the 1986 and
                            subsequent crops from the association);
                            and
                              (iii) each importer of Flue-cured or
                            Burley tobacco shall pay to the
                            appropriate association, for deposit in
                            the Fund of the association, an
                            assessment, in an amount that is equal
                            to the product obtained by
                            multiplying--
                                      (I) the number of pounds of
                                    tobacco that is imported by the
                                    importer; by
                                      (II) the sum of the amount of
                                    per pound producer
                                    contributions and purchaser
                                    assessments that are payable by
                                    domestic producers and
                                    purchasers of Flue-cured and
                                    Burley tobacco under clauses
                                    (i) and (ii); and
                      (B) that, upon making a contribution under
                    subparagraph (A)--
                              (i) in the case of quota tobacco
                            marketed other than by consignment to
                            an association for a price support
                            advance, the producer shall receive
                            from the association capital stock or,
                            if the association does not issue such
                            stock, a capital certificate having a
                            par value or face amount, respectively,
                            equal to the contribution; and
                              (ii) in the case of quota tobacco
                            consigned by the producer to an
                            association for a price support
                            advance, the producer shall receive
                            from the association a qualified per
                            unit retain certificate, as defined in
                            section 1388(h) of the Internal Revenue
                            Code, having a face amount equal to the
                            amount of the contribution and
                            representing an interest in the
                            association's Fund.
            The amount of producer contributions and purchaser
            assessments shall be determined in such a manner that
            producers and purchasers share equally, to the maximum
            extent practicable, in maintaining the Fund of an
            association. In making such determination with respect
            to the assessment of a purchaser, only 1985 and
            subsequent crops of Flue-cured and Burley quota tobacco
            shall be taken into account. The Secretary shall
            approve the amount of the contributions and assessments
            determined by an association from time to time under
            this paragraph only if the Secretary determines that
            such amount will result in accumulation of a Fund
            adequate to reimburse the Corporation for any net
            losses which the Corporation may sustain under its loan
            agreements with the association, based on reasonable
            estimates of the amounts which the Corporation will
            lend to the association under such agreements and the
            proceeds which will be realized from the sales of
            tobacco which are pledged to the Corporation by the
            association as security for loans;
              (2) require that any producer contribution or
            purchaser or importer assessment due under paragraph
            (1) shall be collected--
                      (A) from the person who acquired the tobacco
                    involved from the producer, except that if the
                    tobacco is marketed by sale, an amount equal to
                    the producer contribution may be deducted by
                    the purchaser from the price paid to such
                    producer;
                      (B) if the tobacco involved is marketed by a
                    producer through a warehouseman or agent, from
                    such warehouseman or agent, who may--
                              (i) deduct an amount equal to the
                            producer contribution from the price
                            paid to the producer; and
                              (ii) add an amount equal to the
                            purchaser assessment to the price paid
                            by the purchaser;
                      (C) if the tobacco involved is marketed by a
                    producer directly to any person outside the
                    United States, from the producer, who may add
                    an amount equal to the purchaser assessment to
                    the price paid by the purchaser; and
                      (D) if the tobacco involved is imported by an
                    importer, from the importer.
              (3) require that the Fund established by each
            association shall be kept and maintained separate from
            all other accounts of the association and shall be used
            exclusively, as prescribed by the Secretary, for the
            purpose of ensuring, insofar as practicable, that the
            Corporation, under its loan agreements with the
            association with respect to 1982 and subsequent crops
            of quota tobacco, will suffer no net losses (including,
            but not limited to, recovery of the amount of loans
            extended to cover the overhead costs of the
            association), after any net gains are applied to net
            losses of the corporation under paragraph (5):
            Provided, That, notwithstanding any other provision of
            law, use by the association of moneys in the Fund,
            including interest and other earnings, for the purposes
            of reducing the association's outstanding indebtedness
            to the Corporation associated with 1982 and subsequent
            crops of quota tobacco and making loan advances to
            producers is authorized, and use of such moneys for any
            other purposes that will be mutually beneficial to
            producers and purchasers who contribute or pay to the
            Fund and to the Corporation, shall, if approved by the
            Secretary, be considered an appropriate use of the
            Fund;
              (4) permit an association to invest the monies in the
            Fund in such manner as the Secretary may approve, and
            require that the interest or other earnings on such
            investment shall become a part of the Fund;
              (5) require that loan agreements between the
            Corporation and the association provide that the
            Corporation shall retain the net gains from each of the
            1982 and subsequent crops of tobacco pledged by the
            association as security for price support loans, and
            that such net gains will be used for the purpose of (A)
            offsetting any losses sustained by the Corporation
            under its loan agreements with the association for any
            of the 1982 and subsequent crops of loan tobacco, or
            (B) reducing the outstanding balance of any price
            support loan made by the Corporation to the association
            under such agreements for 1982 and subsequent crops of
            tobacco, or for both such purposes;
              (6); and
              (7) effective for the 1986 and subsequent crops of
            quota tobacco, provide, in loan agreements between the
            Corporation and an association, that if the Secretary
            determines that the amount in the Fund or the net gains
            referred to in paragraph (5) exceeds the amounts
            necessary for the purposes specified in this section,
            the association, with the approval of the Secretary,
            may suspend the payment and collection of contributions
            and assessments under this section on terms and
            conditions established by the association, with the
            approval of the Secretary.
      (e) If any association which has entered into a loan
    agreement with the Corporation with respect to 1982 or
    subsequent crops of quota tobacco fails or refuses to comply
    with the provisions of this section, the regulations issued by
    the Secretary thereunder, or the terms of such agreement, the
    Secretary may terminate such agreement or provide that no
    additional loan funds may be made available thereunder to the
    association. In such event, the Secretary shall make price
    support available to producers of the kind or kinds of tobacco,
    the price of which had been supported through loans to such
    association, through such other means as are authorized by this
    Act or the Commodity Credit Corporation Charter Act.
      (f) If, under subsection (e), a loan agreement with an
    association is terminated, or if an association having a loan
    agreement with the Corporation is dissolved, merges with
    another association, or otherwise ceases to operate, the Fund
    or the net gains referred to in subsection (d)(5) shall be
    applied or disposed of in such manner as the Secretary may
    approve or prescribe, except that they shall, to the extent
    necessary, first be applied or used for the purposes therefor
    prescribed in this section.
      (g) The Secretary shall issue regulations necessary to carry
    out the provisions of this section.
      (h)(1)(A) Each person who fails to collect any contribution
    or assessment as required by subsection (d)(2) and remit such
    contribution or assessment to the association, at such time and
    in such manner as may be prescribed by the Secretary, shall be
    liable, in addition to any amount due, to a marketing penalty
    at a rate equal to 75 percent of the average market price
    (calculated to the nearest whole cent) for the kind of tobacco
    involved for the immediately preceding year on the quantity of
    tobacco as to which the failure occurs.
      (B) Each importer who fails to pay to the association an
    assessment as required by subsection (d)(2) at such time and in
    such manner as may be prescribed by the Secretary, shall be
    liable, in addition to any amount due, for a marketing penalty
    at a rate equal to 75 percent of the average market price
    (calculated to the nearest whole cent) for the respective kind
    of tobacco for the immediately preceding year on the quantity
    of tobacco as to which the failure occurs.
      (C) The Secretary may reduce any such marketing penalty in
    such amount as the Secretary determines equitable in any case
    in which the Secretary determines that the failure was
    unintentional or without knowledge on the part of the person
    concerned.st
      (D) Any penalty provided for under this paragraph shall be
    assessed by the Secretary after notice and opportunity for a
    hearing.
      (2)(A) Any person against whom a penalty is assessed under
    this subsection may obtain review of such penalty in an
    appropriate district court of the United States by filing a
    civil action in such court not later than 30 days after such
    penalty is imposed.
      (B) The Secretary shall promptly file in such court a
    certified copy of the record on which the penalty is based.
      (3) The district courts of the United States shall have
    jurisdiction to review and enforce any penalty imposed under
    this subsection.
      (4) An amount equivalent to any penalty collected by the
    Secretary under this subsection shall be transmitted by the
    Secretary to the appropriate association, for deposit in the
    Fund of such association.
      (5) The remedies provided in this subsection shall be in
    addition to, and not exclusive of, other remedies that may be
    available.

              marketing assessments to no net cost tobacco account

      Sec. 315B. (a) As used in this section--
              (1) the term ``association'' means a producer-owned
            cooperative marketing association which has entered
            into a loan agreement with the Corporation to make
            price support available to producers of a kind of
            tobacco;
              (2) the term ``Account'' means an account established
            by and in the Corporation for an association, which
            account shall be known as the ``No Net Cost Tobacco
            Account'';
              (3) the term ``to market'' means to dispose of
            tobacco by voluntary or involuntary sale, barter,
            exchange, gift inter vivos, or consigning the tobacco
            to an association for a price support advance;
              (4) the term ``net gains'' means the amount by which
            total proceeds obtained from the sale by an association
            of a crop of a kind of tobacco pledged to the
            Corporation for price support loan exceeds the
            principal amount of the price support loan made by the
            Corporation to the association on such crop, plus
            interest and charges;
              (5) the term ``tobacco'' means any kind of tobacco as
            defined in section 301(b)(15) of the Agricultural
            Adjustment Act of 1938, for which marketing quotas are
            in effect or for which marketing quotas are not
            disapproved by producers;
              (6) the term ``area'', when used in connection with
            an association, means the general geographical area in
            which farms of the producer-members of such association
            are located, as determined by the Secretary;
              (7) the term ``Corporation'' shall have the meaning
            given to it in section 106A(a)(2); and
              (8) the term ``purchaser'' means any person who
            purchases in the United States, either directly or
            indirectly for the account of such person or another
            person, Flue-cured or Burley quota tobacco.
      (b) Notwithstanding section 106A, the Secretary shall, upon
    the request of any association, and may, if the Secretary
    determines, after consultation with such association, that the
    accumulation of the No Net Cost Tobacco Fund for such
    association under section 106A is, and is likely to remain,
    inadequate to reimburse the Corporation for net losses which
    the Corporation sustains under its loan agreement with such
    association--
              (1) continue to make price support available to
            producers through such association in accordance with
            loan agreements entered into between the Corporation
            and such association; and
              (2) establish and maintain in accordance with this
            section a No Net Cost Tobacco Account for such
            association in lieu of the No Net Cost Tobacco Fund
            established within such association under section 106A.
      (c)(1) Any Account established for an association under
    subsection (b)(2) shall be established within the Corporation
    and shall be comprised of amounts paid by producers,
    purchasers, and importers under subsection (d).
      (2) Upon the establishment of an Account for an association,
    any amount in the No Net Cost Tobacco Fund established within
    such association under section 106A shall be applied or
    disposed of in such manner as the Secretary may approve or
    prescribe, except that such amount shall, to the extent
    necessary, first be applied or used for the purposes therefor
    prescribed in such section.
      (d)(1)(A) If an Account is established for an association
    under subsection (b)(2), then the Secretary shall require (in
    lieu of any requirement under section 106A(d)(1)) that each
    producer of the kind of tobacco involved whose farm is within
    such association's area shall, as a condition of eligibility
    for price support, agree, with respect to all of such kind of
    tobacco marketed by the producer from the farm, to pay to the
    Corporation, for deposit in such association's Account,
    marketing assessments as determined under paragraph (2) and
    collected under paragraph (3).
      (B) The Secretary shall also require (in lieu of any
    requirement under section 106A(d)(1)) that each purchaser of
    Flue-cured and Burley quota tobacco shall pay to the
    Corporation, for deposit in the Account of such association, an
    assessment, as determined under paragraph (2) and collected
    under paragraph (3), with respect to purchases of all such kind
    of tobacco marketed by a producer from a farm (including
    purchases of such tobacco from the 1986 and subsequent crops
    from the association).
      (C) The Secretary shall also require (in lieu of any
    requirement under section 106A(d)(1)) that each importer of
    Flue-cured and Burley tobacco shall pay to the Corporation, for
    deposit in the Account of the association, an assessment, as
    determined under paragraph (2) and collected under paragraph
    (3), with respect to purchases of all such kinds of tobacco
    imported by the importer.
      (2)(A) For purposes of paragraph (1), the Secretary shall
    determine and adjust from time to time, in consultation with
    such association, the amount of the marketing assessment which
    shall be imposed, as a condition of eligibility for price
    support, on each pound of the kind of tobacco involved marketed
    by a producer from a farm within such association's area and
    the amount of the assessment to be paid by purchasers of
    tobacco. The amount of the assessment to be paid by producers
    and purchasers shall be determined in such a manner that
    producers and purchasers share equally, to the maximum extent
    practicable, in maintaining the Account of an association. In
    making such determination with respect to the assessment of a
    purchaser, only 1985 and subsequent crops of Flue-cured and
    Burley quota tobacco shall be taken into account. The amount of
    the assessment shall be equal to an amount which, when
    collected, will result in an accumulation of an Account for
    such association adequate to reimburse the Corporation for any
    net losses which the Corporation may sustain under its loan
    agreements with such association, based on reasonable estimates
    of the amounts which the Corporation will lend to such
    association under such agreements and the proceeds which will
    be realized from the sales of the kind of tobacco involved
    which are pledged to the Corporation by such association as
    security for loans. Notwithstanding the foregoing provisions of
    this paragraph, the amount of any assessment that is determined
    by the Secretary for the 1986 and subsequent crops of Burley
    quota tobacco shall be determined without regard to any net
    losses that the Corporation may sustain under the loan
    agreements of the Corporation with such association with
    respect to the 1983 crop of such tobacco.
      (B) With respect to the 1985 crop of Burley tobacco, for the
    purposes of paragraph (1), the marketing assesment shall not be
    more than 4 cents per pound.
      (C) The amount of the assessment to be paid by importers
    shall be an amount that is equal to the product obtained by
    multiplying--
              (i) the number of pounds of tobacco that is imported
            by the importer; by
              (ii) the sum of the amount of per pound producer and
            purchaser assessments that are payable by domestic
            producers and purchasers of the respective kind of
            tobacco under this paragraph.
      (3)(A) Except as provided in subparagraphs (B) and (C), any
    assessment to be paid by a producer or a purchaser under
    paragraph (1) shall be collected from the person who acquired
    the tobacco involved from such producer, except that if the
    tobacco is marketed by sale, an amount equal to the producer
    assessment may be deducted by the purchaser from the price paid
    to such producer.
      (B) If tobacco of the kind for which an Account is
    established is marketed by a producer through a warehouseman or
    agent, both the producer and the purchaser assessment shall be
    collected from such warehouseman or agent, who may--
              (i) deduct an amount equal to the producer assessment
            from the price paid to the producer; and
              (ii) add an amount equal to the purchaser assessment
            to the price paid by the purchaser.
      (C) If tobacco of the kind for which an Account is
    established is marketed by a producer directly to any person
    outside the United States, both the producer and the purchaser
    assessment shall be collected from the producer, who may add an
    amount equal to the purchaser assessment to the price paid by
    the purchaser.
      (D) If Flue-cured or Burley tobacco is imported by an
    importer, any importer assessment required by subsection (d)
    shall be collected from the importer.
      (e) Amounts deposited in an Account established for an
    association shall be used by the Secretary for the purpose of
    ensuring, insofar as practicable, that the Corporation under
    its loan agreements with such association will suffer, with
    respect to the crop involved, no net losses (including, but not
    limited to, recovery of the amount of loans extended to cover
    the overhead costs of the association), after any net gains are
    applied to net losses of the Corporation pursuant to subsection
    (h).
      (f) The Secretary shall provide, in any loan agreement
    between the Corporation and an association for which an Account
    has been established under subsection (b)(2), that if the
    Secretary determines that the amount in such Account or the net
    gains referred to in subsection (h) exceed the amounts
    necessary for the purposes of this section, then the Secretary,
    in consultation with such association, may suspend the payment
    and collection of marketing assessments under this section upon
    terms and conditions established by the Secretary.
      (g) With respect to any association for which an Account is
    established under subsection (b)(2), if a loan agreement
    between the Corporation and such association is terminated, if
    such association is dissolved or merges with another
    association that has entered into a loan agreement with the
    Corporation to make price support available to producers of the
    kind of tobacco involved, or if such Account terminates by
    operation of law, then amounts in such Account and the net
    gains referred to in subsection (h) shall be applied to or
    disposed of in such manner as the Secretary may prescribe,
    except that they shall, to the extent necessary, first be
    applied to or used for the purposes therefor prescribed in this
    section.
      (h) The provisions of section 106A(d)(5) relating to net
    gains shall apply to any loan agreement between an association
    and the Corporation entered into upon or after the
    establishment of an Account for such association under
    subsection (b)(2).
      (i) The Secretary shall issue regulations necessary to carry
    out the provisions of this section.
      (j)(1)(A) Each person who fails to collect any assessment as
    required by subsection (d)(3) and remit such assessment to the
    Corporation, at such time and in such manner as may be
    prescribed by the Secretary, shall be liable, in addition to
    any amount due, to a marketing penalty at a rate equal to 75
    percent of the average market price (calculated to the nearest
    whole cent) for the kind of tobacco involved for the
    immediately preceding year on the quantity of tobacco as to
    which the failure occurs.
      (B) Each importer who fails to pay to the Corporation an
    assessment as required by subsection (d) at such time and in
    such manner as may be prescribed by the Secretary, shall be
    liable, in addition to any amount due, to a marketing penalty
    at a rate equal to 75 percent of the average market price
    (calculated to the nearest whole cent) for the respective kind
    of tobacco for the immediately preceding year on the quantity
    of tobacco as to which the failure occurs.
      (C) The Secretary may reduce any such marketing penalty in
    such amount as the Secretary determines equitable in any case
    in which the Secretary determines that the failure was
    unintentional or without knowledge on the part of the person
    concerned.
      (D) Any penalty provided for under this paragraph shall be
    assessed by the Secretary after notice and opportunity for a
    hearing.
      (2)(A) Any person against whom a penalty is assessed under
    this subsection may obtain review of such penalty in an
    appropriate district court of the United States by filing a
    civil action in such court not later than 30 days after such
    penalty is imposed.
      (B) The Secretary shall promptly file in such court a
    certified copy of the record on which the penalty is based.
      (3) The district courts of the United States shall have
    jurisdiction to review and enforce any penalty imposed under
    this subsection.
      (4) An amount equivalent to any penalty collected by the
    Secretary under this subsection shall be transmitted by the
    Secretary to the Corporation, for deposit in the Account of the
    appropriate association.
      (5) The remedies provided in this subsection shall be in
    addition to, and not exclusive of, other remedies that may be
    available.

                       [PART II--ACREAGE ALLOTMENTS--CORN

                      [ADJUSTMENT OF FARM MARKETING QUOTAS

      [Sec. 326. (a) Whenever in any county or other area the
    Secretary finds that the actual production of corn plus the
    amount of corn stored under seal in such county or other area
    is less than the normal production of the marketing percentage
    of the farm acreage allotment in such county or other area, the
    Secretary shall terminate farm marketing quotas for corn in
    such county or other area.
      [(b) Whenever, upon any farm, the actual production of the
    acreage of corn is less than the normal production of the
    marketing percentage of the farm acreage allotment, there may
    be marketed, without penalty, from such farm an amount of corn
    from the corn stored under seal pursuant to section 324 which,
    together with the actual production of the then current crop,
    will equal the normal production of the marketing percentage of
    the farm acreage allotment.
      [(c) Whenever, in any marketing year, marketing quotas are
    not in effect with respect to the crop of corn produced in the
    calendar year in which such marketing year begins, all
    marketing quotas applicable to previous crops of corn shall be
    terminated.

                    [NONESTABLISHMENT OF ACREAGE ALLOTMENTS

      [Sec. 330. Notwithstanding any other provision of law,
    acreage allotments and a commercial corn-producing area shall
    not be established for the 1959 and subsequent crops of corn.

                       [PART III--MARKETING QUOTAS--WHEAT

                             [LEGISLATIVE FINDINGS

      [Sec. 331. Wheat is a basic source of food for the Nation, is
    produced throughout the United States by more than a million
    farmers, is sold on the country-wide market and, as wheat or
    flour, flows almost entirely through instrumentalities of
    interstate and foreign commerce from producers to consumers.
      [Abnormally excessive and abnormally deficient supplies of
    wheat on the country-wide market acutely and directly affect,
    burden, and obstruct interstate and foreign commerce.
    Abnormally excessive supplies overtax the facilities of
    interstate and foreign transportation, congest terminal markets
    and milling centers in the flow of wheat from producers to
    consumers, depress the price of wheat in interstate and foreign
    commerce and otherwise disrupt the orderly marketing of such
    commodity in such commerce. Abnormally deficient supplies
    result in an inadequate flow of wheat and its products in
    interstate and foreign commerce with consequent injurious
    effects to the instrumentalities of such commerce and with
    excessive increases in the prices of wheat and its products in
    interstate and foreign commerce.
      [It is in the interest of the general welfare that interstate
    and foreign commerce in wheat and its products be protected
    from such burdensome surpluses and distressing shortages, and
    that a supply of wheat be maintained which is adequate to meet
    domestic consumption and export requirements in years of
    drought, flood, and other adverse conditions as well as in
    years of plenty, and that the soil resources of the Nation be
    not wasted in the production of such burdensome surpluses. Such
    surpluses result in disastrously low prices of wheat and other
    grains to wheat producers, destroy the purchasing power of
    grain producers for industrial products, and reduce the value
    of the agricultural assets supporting the national credit
    structure. Such shortages of wheat result in unreasonably high
    prices of flour and bread to consumers and loss of market
    outlets by wheat producers.
      [The conditions affecting the production and marketing of
    wheat are such that, without Federal assistance, farmers,
    individually or in cooperation, cannot effectively prevent the
    recurrence of such surpluses and shortages and the burdens on
    interstate and foreign commerce resulting therefrom, maintain
    normal supplies of wheat, or provide for the orderly marketing
    thereof in interstate and foreign commerce.
      [Wheat which is planted and not disposed of prior to the date
    prescribed by the Secretary for the disposal of excess acres of
    wheat is an addition to the total supply of wheat and has a
    direct effect on the price of wheat in interstate and foreign
    commerce and may also affect the supply and price of livestock
    and livestock products. In the circumstances, wheat not
    disposed of prior to such date must be considered in the same
    manner as mechanically harvested wheat in order to achieve the
    policy of the Act.
      [The diversion of substantial acreages from wheat to the
    production of commodities which are in surplus supply or which
    will be in surplus supply if they are permitted to be grown on
    the diverted acreage would burden, obstruct, and adversely
    affect interstate and foreign commerce in such commodities, and
    would adversely affect the prices of such commodities in
    interstate and foreign commerce. Small changes in the supply of
    a commodity could create a sufficient surplus to affect
    seriously the price of such commodity in interstate and foreign
    commerce. Large changes in the supply of such commodity could
    have a more acute effect on the price of the commodity in
    interstate and foreign commerce and, also, could overtax the
    handling, processing, and transportation facilities through
    which the flow of interstate and foreign commerce in such
    commodity is directed. Such adverse effects caused by
    overproduction in one year could further result in a deficient
    supply of the commodity in the succeeding year, causing
    excessive increases in the price of the commodity in interstate
    and foreign commerce in such year. It is, therefore, necessary
    to prevent acreage diverted from the production of wheat to be
    used to produce commodities which are in surplus supply or
    which will be in surplus supply if they are permitted to be
    grown on the diverted acreage.
      [The provisions of this part affording a cooperative plan to
    wheat producers are necessary in order to minimize recurring
    surpluses and shortages of wheat in interstate and foreign
    commerce, to provide for the maintenance of adequate reserve
    supplies thereof, to provide for an adequate and orderly flow
    of wheat and its products in interstate and foreign commerce at
    prices which are fair and reasonable to farmers and consumers,
    and to prevent acreage diverted from the production of wheat
    from adversely affecting other commodities in interstate and
    foreign commerce.

                   [PROCLAMATIONS OF SUPPLIES AND ALLOTMENTS

      [Sec. 332. (a) Whenever prior to April 15 in any calendar
    year the Secretary determines that the total supply of wheat in
    the marketing year beginning in the next succeeding calendar
    year will, in the absence of a marketing quota program, likely
    be excessive, the Secretary shall proclaim that a national
    marketing quota for wheat shall be in effect for such marketing
    year and for either the following marketing year or the
    following two marketing years, if the Secretary determines and
    declares in such proclamation that a two- or three-year
    marketing quota program is necessary to effectuate the policy
    of the Act.
      [(b) If a national marketing quota for wheat has been
    proclaimed for any marketing year, the Secretary shall
    determine and proclaim the amount of the national marketing
    quota for such marketing year not earlier than January 1 or
    later than April 15 of the calendar year preceding the year in
    which such marketing year begins. The amount of the national
    marketing quota for wheat for any marketing year shall be an
    amount of wheat which the Secretary estimates (i) will be
    utilized during such marketing year for human consumption in
    the United States as food, food products, and beverages,
    composed wholly or partly of wheat, (ii) will be utilized
    during such marketing year in the United States for seed, (iii)
    will be exported either in the form of wheat or products
    thereof and (iv) will be utilized during such marketing year in
    the United States as livestock (including poultry) feed,
    excluding the estimated quantity of wheat which will be
    utilized for such purpose as a result of the substitution of
    wheat for feed grains under section 328 of the Food and
    Agriculture Act of 1962; less (A) an amount of wheat equal to
    the estimated imports of wheat into the United States during
    such marketing year and, (B) if the stocks of wheat owned by
    the Commodity Credit Corporation are determined by the
    Secretary to be excessive, an amount of wheat determined by the
    Secretary to be a desirable reduction in such marketing year in
    such stocks to achieve the policy of the Act: Provided, That if
    the Secretary determines that the total stocks of wheat in the
    Nation are insufficient to assure an adequate carryover for the
    next succeeding marketing year, the national marketing quota
    otherwise determined shall be increased by the amount the
    Secretary determines to be necessary to assure an adequate
    carryover: And provided further, That the national marketing
    quota for wheat for any marketing year shall be not less than
    one billion bushels.
      [(c) If after the proclamation of a national marketing quota
    for wheat for any marketing year, the Secretary has reason to
    believe that, because of a national emergency or because of a
    material increase in the demand for wheat, the national
    marketing quota should be terminated or the amount thereof
    increased, he shall cause an immediate investigation to be made
    to determine whether such action is necessary in order to meet
    such emergency or increase in the demand for wheat. If on the
    basis of such investigation, the Secretary finds that such
    action is necessary, he shall immediately proclaim such finding
    and the amount of any such increase found by him to be
    necessary and thereupon such national marketing quota shall be
    so increased or terminated. In case any national marketing
    quota is increased under this subsection, the Secretary shall
    provide for such increase by increasing acreage allotments
    established under this part by a uniform percentage.
      [(d) Notwithstanding any other provision of this Act, the
    Secretary shall not proclaim a national marketing quota for the
    crops of wheat planted for harvest in the calendar years 1966
    through 1970, and farm marketing quotas shall not be in effect
    for such crops of wheat.

                          [NATIONAL ACREAGE ALLOTMENT

      [Sec. 333. The Secretary shall proclaim a national acreage
    allotment for each crop of wheat. The amount of the national
    acreage allotment for any crop of wheat shall be the number of
    acres which the Secretary determines on the basis of the
    projected national yield and expected underplantings (acreage
    other than that not harvested because of program incentives) of
    farm acreage allotments will produce an amount of wheat equal
    to the national marketing quota for wheat for the marketing
    year for such crop, or if a national marketing quota was not
    proclaimed, the quota which would have been determined if one
    had been proclaimed.

                  [APPORTIONMENT OF NATIONAL ACREAGE ALLOTMENT

      [Sec. 334. (a) The national allotment for wheat, less a
    reserve of not to exceed 1 per centum thereof for apportionment
    as provided in this subsection and less the special acreage
    reserve provided for in this subsection, shall be apportioned
    by the Secretary among the States on the basis of the preceding
    year's allotment for each such State, including all amounts
    allotted to the State and including for 1967 the increased
    acreage in the State allotted for 1966 under section 335,
    adjusted to the extent deemed necessary by the Secretary to
    establish a fair and equitable apportionment base for each
    State, taking into consideration established crop rotation
    practices, estimated decrease in farm allotments because of
    loss of history, and other relevant factors. The reserve
    acreage set aside herein for apportionment by the Secretary
    shall be used (1) to make allotments to counties in addition to
    the county allotments made under subsection (b) of this
    section, on the basis of the relative needs of counties for
    additional allotments because of reclamation and other new
    areas coming into production of wheat, or (2) to increase the
    allotment for any county, in which wheat is the principal crop
    produced, on the basis of its relative need for such increase
    if the average ratio of wheat acreage allotment to cropland on
    old wheat farms in such county is less by at least 20 per
    centum than such average ratio on old wheat farms in an
    adjoining county or counties in which wheat is the principal
    grain crop produced or if there is a definable contiguous area
    consisting of at least 10 per centum of the cropland acreage in
    such county in which the average ratio of wheat acreage
    allotment to cropland on old wheat farms is less by at least 20
    per centum than such average ratio on the remaining old wheat
    farms in such county, provided that such low ratio of wheat
    acreage allotment to cropland is due to the shift prior to 1951
    from wheat to one or more alternative income-producing crops
    which, because of plant disease or sustained loss of markets,
    may no longer be produced at a fair profit and there is no
    other alternative income-producing crop suitable for production
    in the area or county. The increase in the county allotment
    under clause (2) of the preceding sentence shall be used to
    increase allotments for old wheat farms in the affected area to
    make such allotments comparable with those on similar farms in
    the adjoining areas or counties but the average ratio of
    increased allotments to cropland on such farms shall not exceed
    the average ratio of wheat acreage allotment to cropland on old
    wheat farms in the adjoining areas or counties. There also
    shall be made available a special acreage reserve of not in
    excess of one million acres as determined by the Secretary to
    be desirable for the purposes hereof which shall be in addition
    to the national acreage reserve provided for in this
    subsection. Such special acreage reserve shall be made
    available to the States to make additional allotments to
    counties on the basis of the relative needs of counties, as
    determined by the Secretary, for additional allotments to make
    adjustments in the allotments on old wheat farms (that is,
    farms on which wheat has been seeded or regarded as seeded to
    one or more of the, three crops immediately preceding the crop
    for which the allotment is established) on which the ratio of
    wheat acreage allotment to cropland on the farm is less than
    one-half the average ratio of wheat acreage allotment to
    cropland on old wheat farms in the county. Such adjustments
    shall not provide an allotment for any farm which would result
    in an allotment-cropland ratio for the farm in excess of one-
    half of such county average ratio and the total of such
    adjustments in any county shall not exceed the acreage made
    available therefor in the county. Such apportionment from the
    special acreage reserve shall be made only to counties where
    wheat is a major income-producing crop, only to farms on which
    there is limited opportunity for production of an alternative
    income-producing crop, and only if an efficient farming
    operation on the farm requires the allotment of additional
    acreage from the special acreage reserve. For the purposes of
    making adjustments hereunder the cropland on the farm shall not
    include any land developed as cropland subsequent to the 1963
    crop year.
      [(b) The State acreage allotment for wheat, less a reserve of
    not to exceed 3 per centum thereof for apportionment as
    provided in subsection (c) of this section, shall be
    apportioned by the Secretary among the counties in the State,
    on the basis of the preceding year's wheat allotment in each
    such county, including for 1967, the increased acreage in the
    county allotted for 1966 pursuant to section 335, adjusted to
    the extent deemed necessary by the Secretary in order to
    establish a fair and equitable apportionment base for each
    county, taking into consideration established crop rotation
    practices, estimated decrease in farm allotments because of
    loss of history, and other relevant factors.
      [(c)(1) The allotment to the county shall be apportioned by
    the Secretary, through the local committees, among the farms
    within the county on the basis of past acreage of wheat,
    tillable acres, crop rotation practices, type of soil, and
    topography: Not more than 3 per centum of the State allotment
    shall be apportioned to farms on which wheat has not been
    planted during any of the three marketing years immediately
    preceding the marketing year in which the allotment is made.
    For the purpose of establishing farm acreage allotments--(i)
    the past acreage of wheat on any farm for 1958 or 1965 shall be
    the base acreage determined for the farm under the regulations
    issued by the Secretary for determining 1958 or 1965 farm wheat
    acreage allotments; (ii) if subsequent to the determination of
    such base acreage the 1958 or 1965 wheat acreage allotment for
    the farm is increased through administrative, review, or court
    proceedings, the 1958 or 1965 farm base acreage shall be
    increased in the same proportion; and (iii) the past acreage of
    wheat for 1959 and any subsequent year except 1965 shall be the
    wheat acreage on the farm which is not in excess of the farm
    wheat acreage allotment, plus, in the case of any farm which is
    in compliance with its farm wheat acreage allotment, the
    acreage diverted under such wheat allotment programs: Provided,
    That for 1959 and subsequent years in the case of any farm on
    which the entire amount of the farm marketing excess is
    delivered to the Secretary or stored in accordance with
    applicable regulations to avoid or postpone payment of the
    penalty, the past acreage of wheat for the year in which such
    farm marketing excess is so delivered or stored shall be the
    farm base acreage of wheat determined for the farm under the
    regulations issued by the Secretary for determining farm wheat
    acreage allotments for such year, but if any part of the amount
    of wheat so stored is later depleted and penalty becomes due by
    reason of such depletion for the purpose of establishing farm
    wheat acreage allotments subsequent to such depletion the past
    acreage of wheat or the farm for the year in which the excess
    was produced shall be reduced to the farm wheat acreage
    allotment for such year.
      [(2) Notwithstanding any other provision of law, each old or
    new farm acreage allotment for the 1962 crop of wheat as
    determined on the basis of a minimum national acreage allotment
    of fifty million acres shall be reduced by 10 per centum. In
    the event notices of farm acreage allotments for the 1962 crop
    of wheat have been mailed to farm operators prior to the
    effective date of this subparagraph (2), new notices showing
    the required reduction shall be mailed to farm operators as
    soon as practicable.
      [(3) Notwithstanding the provisions of paragraph (1) of this
    subsection, the past acreage of wheat for 1967 and any
    subsequent year shall be the acreage of wheat planted, plus the
    acreage regarded as planted, for harvest as grain on the farm
    which is not in excess of the farm acreage allotment.
      [(4) Notwithstanding any other provision of this subsection
    (c), the farm acreage allotment for the 1967 and any subsequent
    crop of wheat shall be established for each old farm by
    apportioning the county wheat acreage allotment among farms in
    the county on which wheat has been planted, or is considered to
    have been planted, for harvest as grain in any one of the three
    years immediately preceding the year for which allotments are
    determined on the past acreage of wheat and the farm acreage
    allotment for the year immediately preceding the year for which
    the allotment is being established, adjusted as hereinafter
    provided. For purposes of this paragraph, the acreage allotment
    for the immediately preceding year may be adjusted to reflect
    established crop rotation practices, may be adjusted downward
    to reflect a reduction in the tillable acreage on the farm, and
    may be adjusted upward to reflect such other factors as the
    Secretary determines should be considered for the purpose of
    establishing a fair and equitable allotment: Provided, That (i)
    for the purposes of computing the allotment for any year, the
    acreage allotment for the farm for the immediately preceding
    year shall be decreased by 7 per centum if for the year
    immediately preceding the year for which such reduction is made
    neither a voluntary diversion program nor a voluntary
    certificate program was in effect and there was noncompliance
    with the farm acreage allotment for such year; (ii) for
    purposes of clause (i) any farm on which the entire amount of
    farm marketing excess is delivered to the Secretary, stored, or
    adjusted to zero in accordance with applicable regulations to
    avoid or postpone payment of the penalty when farm marketing
    quotas are in effect, shall be considered in compliance with
    the allotment, but if any part of the amount of wheat so stored
    is later depleted and penalty becomes due by reason of such
    depletion, the allotment for such farm next computed after
    determination of such depletion shall be reduced by reducing
    the allotment for the immediately preceding year by 7 per
    centum and (iii) for purposes of clause (i) if the Secretary
    determines that the reduction in the allotment does not provide
    fair and equitable treatment to producers on farms following
    special crop rotation practices, he may modify such reduction
    in the allotment as he determines to be necessary' to provide
    fair and equitable treatment to such producers.
      [(g) Notwithstanding any other provision of law, no acreage
    in the commercial wheat producing area seeded to wheat for
    harvest as grain in 1958 or thereafter except 1965 in excess of
    acreage allotments shall be considered in establishing future
    State and county acreage allotments. The planting on a farm in
    the commercial wheat producing area of wheat of the 1958 or any
    subsequent crop for which no farm wheat acreage allotment was
    established shall not make the farm eligible for an allotment
    as an old farm pursuant to the first sentence of subsection (c)
    of this section nor shall such farm by reason of such planting
    be considered ineligible for an allotment as a new farm under
    the second sentence of such subsection.
      [(i) If with respect to any crop of wheat, the Secretary
    finds that the acreage allotments of farms producing any type
    of wheat are inadequate to provide for the production of a
    sufficient quantity of such type of wheat to satisfy the demand
    therefor, the wheat acreage allotment for such crop for each
    farm located in a county designated by the Secretary as a
    county which (1) is capable of producing such type of wheat,
    and (2) has produced such type of wheat for commercial food
    products during one or more of the five years immediately
    preceding the year in which such crop is harvested, shall be
    increased by such uniform percentage as he deems necessary to
    provide for such quantity. No increase shall be made under this
    subsection in the wheat acreage allotment of any farm for any
    crop if any wheat other than such type of wheat is planted on
    such farm for such crop. Any increases in wheat acreage
    allotments authorized by this subsection shall be in addition
    to the National, State, and county wheat acreage allotments,
    and such increases shall not be considered in establishing
    future State, county, and farm allotments. The provisions of
    paragraph (6) of Public Law 74, Seventy-seventh Congress (7
    U.S.C. 1340(6)), and section 326(b) of this Act, relating to
    the reduction of the storage amount of wheat shall apply to the
    allotment for the farm established without regard to this
    subsection and not to the increased allotment under this
    subsection. The land use provisions of section 339 shall not be
    applicable to any farm receiving an increased allotment under
    this subsection and the producers on such farms shall not be
    required to comply with such provisions as a condition of
    eligibility for price support.
      [(j) Notwithstanding any other provision of this Act, the
    Secretary shall increase the acreage allotments for the 1970
    and subsequent crops of wheat for privately owned farms in the
    irrigable portion of the area known as the Tulelake division of
    the Klamath project of California located in Modoc and Siskiyou
    Counties, California, as defined by the United States
    Department of the Interior, Bureau of Reclamation, and
    hereinafter referred to as the area. The increase for the area
    for each such crop shall be determined by adding, to the extent
    applications are made therefor, to the total allotments
    established for privately owned farms in the area for the
    particular crop without regard to this subsection (hereinafter
    referred to as the original allotments) an acreage sufficient
    to make available for each such crop a total allotment of
    twelve thousand acres for the area. The additional allotments
    made available by this subsection shall be in addition to the
    National, State, and county allotments otherwise established
    under this section, and the acreage planted to wheat pursuant
    to such increases in allotments shall not be taken into account
    in establishing future State, county, and farm acreage
    allotments except as may be desirable in providing increases in
    allotments for subsequent years under this subsection for the
    production of Durum wheat. The Secretary shall apportion the
    additional allotment acreage made available under this
    subsection between Modoc and Siskiyou Counties on the basis of
    the relative needs for additional allotments for the portion of
    the area in each county. The Secretary shall allot such
    additional acreage to individual farms in the area for which
    applications for increased acreages are made on the basis of
    tillable acres, crop rotation practices, type of soil and
    topography, and the original allotment for the farm, if any.
    The increase in the wheat acreage allotment for any farm under
    this subsection (1) shall not be taken into account in
    computing the farm wheat marketing allocation under section
    379b, and (2) shall be conditioned upon the production of Durum
    wheat on the original allotment and on the increased acreage.
    The producers on a farm receiving an increased allotment under
    this subsection shall not be eligible for diversion payments
    under section 339.
      [(k) Notwithstanding any other provision of this Act, if the
    Secretary determines that because of a natural disaster a
    portion of the farm wheat acreage allotments in a county cannot
    be timely planted or replanted, he may authorize the transfer
    of all or a part of the wheat acreage allotment for any farm in
    the county so affected to another farm in the county or in an
    adjoining county on which one or more of the producers on the
    farm from which the transfer is to be made will be engaged in
    the production of wheat and will share in the proceeds thereof
    in accordance with such regulations as the Secretary may
    prescribe. Any farm allotment transferred under this subsection
    shall be deemed to be planted on the farm which it was
    transferred for the purposes of acreage history credits under
    this Act.

                                [COMMERCIAL AREA

      [Sec. 334a. If the acreage allotment for any State for any
    crop of wheat is twenty five thousand acres or less, the
    Secretary, in order to promote efficient administration of this
    Act and the Agricultural Act of 1949, may designate such State
    as outside the commercial wheat producing area for the
    marketing year for such crop. If such State is so designated,
    acreage allotments for such crop and marketing quotas for the
    marketing year therefor shall not be applicable to any farm in
    such State. Acreage allotments in any State shall not be
    increased by reason of such designation.

                                  [REFERENDUM

      [Sec. 336. If a national marketing quota for wheat for one,
    two or three marketing years is proclaimed, the Secretary
    shall, not later than August 1 of the calendar year in which
    such national marketing quota is proclaimed, conduct a
    referendum, by secret ballot, of farmers to determine whether
    they favor or oppose marketing quotas for the marketing year or
    years for which proclaimed. Any producer who has a farm acreage
    allotment shall be eligible to vote in any referendum held
    pursuant to this section, except that a producer who has a farm
    acreage allotment of less than fifteen acres shall not be
    eligible to vote unless the farm operator elected pursuant to
    section 335 to be subject to the farm marketing quota. The
    Secretary shall proclaim the results of any referendum held
    hereunder within thirty days after the date of such referendum
    and if the Secretary determines that more than one-third of the
    farmers voting in the referendum voted against marketing
    quotas, the Secretary shall proclaim that marketing quotas will
    not be in effect with respect to the crop of wheat produced for
    harvest in the calendar year following the calendar year in
    which the referendum is held. If the Secretary determines that
    two-thirds or more of the farmers voting in a referendum
    approve marketing quotas for a period of two or three marketing
    years, no referendum shall be held for the subsequent year or
    years of such period. Notwithstanding any other provision
    hereof the referendum with respect to the national marketing
    quota for wheat for the marketing year beginning June 1, 1986,
    may be conducted not later than thirty-one days after
    adjournment sine die of the first session of the Ninety-ninth
    Congress.

                              [TRANSFER OF QUOTAS

      [Sec. 338. Farm marketing quotas for wheat shall not be
    transferable, but, in accordance with regulations prescribed by
    the Secretary for such purpose, any farm marketing quota in
    excess of the supply of wheat for such farm for any marketing
    year may be allocated to other farms on which the acreage
    allotment has not been exceeded.

                                   [LAND USE

      [Sec. 339. (a)(1) During any year in which marketing quotas
    for wheat are in effect, the producers on any farm (except a
    new farm receiving an allotment from the reserve for new farms)
    on which any crop is produced on acreage required to be
    diverted from the production of wheat shall be subject to a
    penalty on such crop, in addition to any marketing quota
    penalty applicable to such crops, as provided in this
    subsection unless (1) the crop is designated by the Secretary
    as one which is not in surplus supply and will not be in
    surplus supply if it is permitted to be grown on the diverted
    acreage, or as one the production of which will not
    substantially impair the purpose of the requirements of this
    section, or (2) no wheat is produced on the farm, and the
    producers have not filed an agreement or a statement of
    intention to participate in the payment program formulated
    pursuant to subsection (b) of this section. The acreage
    required to be diverted from the production of wheat on the
    farm shall be an acreage of cropland equal to the number of
    acres determined by multiplying the farm acreage allotment by
    the diversion factor determined by dividing the number of acres
    by which the national acreage allotment (less an acreage equal
    to the increased acreage allotment for 1966 pursuant to section
    335) is reduced below fifty-five million acres by the number of
    acres in the national acreage allotment (less an acreage equal
    to the increased acreage allotted for 1966 pursuant to section
    335). The actual production of any crop subject to penalty
    under this subsection shall be regarded as available for
    marketing and the penalty on such crop shall be computed on the
    actual acreage of such crop at the rate of 65 per centum of the
    parity price per bushel of wheat as of May 1 of the calendar
    year in which such crop is harvested, multiplied by the normal
    yield of wheat per acre established for the farm. Until the
    producers on any farm pay the penalty on such crop, the entire
    crop of wheat produced on the farm and any subsequent crop of
    wheat subject to marketing quotas in which the producer has an
    interest shall be subject to a lien in favor of the United
    States for the amount of the penalty. Each producer having an
    interest in the crop or crops on acreage diverted or required
    to be diverted from the production of wheat shall be jointly
    and severally liable for the entire amount of the penalty. The
    persons liable for the payment or collection of the penalty
    under this section shall be liable also for interest thereon at
    the rate of 6 per centum per annum from the date the penalty
    becomes due until the date of payment of such penalty.
      [(2) The Secretary may require that the acreage on any farm
    diverted from the production of wheat be land which was
    diverted from the production of wheat in the previous year, to
    the extent he determines that such requirement is necessary to
    effectuate the purposes of this subtitle.
      [(3) The Secretary may permit the diverted acreage to be
    grazed in accordance with regulations prescribed by the
    Secretary.
      [(g) The Secretary is authorized to promulgate such
    regulations as may be desirable to carry out the provisions of
    this section.

                       [PART IV--MARKETING QUOTAS--COTTON

                             [LEGISLATIVE FINDINGS

      [Sec. 341. American cotton is a basic source of clothing and
    industrial products used by every person in the United States
    and by substantial numbers of people in foreign countries.
    American cotton is sold on a world-wide market and moves from
    the places of production almost entirely in interstate and
    foreign commerce to processing establishments located
    throughout the world at places outside the State where the
    cotton is produced.
      [Fluctuations in supplies of cotton and the marketing of
    excessive supplies of cotton in interstate and foreign commerce
    disrupt the orderly marketing of cotton in such commerce with
    consequent injury to and destruction of such commerce.
    Excessive supplies of cotton directly and materially affect the
    volume of cotton moving in interstate and foreign commerce and
    cause disparity in prices of cotton and industrial products
    moving in interstate and foreign commerce with consequent
    diminution of the volume of such commerce in industrial
    products.
      [The conditions affecting the production and marketing of
    cotton are such that, without Federal assistance, farmers,
    individually or in cooperation, cannot effectively prevent the
    recurrence of excessive supplies of cotton and fluctuations in
    supplies, cannot prevent indiscriminate dumping of excessive
    supplies on the Nationwide and foreign markets, cannot maintain
    normal carryovers of cotton, and cannot provide for the orderly
    marketing of cotton in interstate and foreign commerce.
      [It is in the interest of the general welfare that interstate
    and foreign commerce in cotton be protected from the burdens
    caused by the marketing of excessive supplies of cotton in such
    commerce, that a supply of cotton be maintained which is
    adequate to meet domestic consumption and export requirements
    in years of drought, flood, and other adverse conditions as
    well as in years of plenty, and that the soil resources of the
    Nation be not wasted in the production of excessive supplies of
    cotton.
      [The provisions of this part affording a cooperative plan to
    cotton producers are necessary and appropriate to prevent the
    burdens on interstate and foreign commerce caused by the
    marketing in such commerce of excessive supplies, and to
    promote, foster, and maintain an orderly flow of an adequate
    supply of cotton in such commerce.

                           [NATIONAL MARKETING QUOTA

      [Sec. 342. Whenever during any calendar year the Secretary
    determines that the total supply of cotton for the marketing
    year beginning in such calendar year will exceed the normal
    supply for such marketing year, the Secretary shall proclaim
    such fact and a national marketing quota shall be in effect for
    the crop of cotton produced in the next calendar year. The
    Secretary shall also determine and specify in such proclamation
    the amount of the national marketing quota in terms of the
    number of bales of cotton (standard bales of five hundred
    pounds gross weight) adequate, together with (1) the estimated
    carryover at the beginning of the marketing year which begins
    in the next calendar year and (2) the estimated imports during
    such marketing year, to make available a normal supply of
    cotton: Provided, That beginning with the 1961 crop, the
    national marketing quota shall be not less than a number of
    bales equal to the estimated domestic consumption and estimated
    exports (less estimated imports) for the marketing year for
    which the quota is proclaimed, except that the Secretary shall
    make such adjustments in the amount of such quota as he
    determines necessary after taking into consideration the
    estimated stocks of cotton in the United States (including the
    qualities of such stocks) and stocks in foreign countries which
    would be available for the marketing year for which the quota
    is being proclaimed if no adjustment of such quota is made
    hereunder, to assure the maintenance of adequate but not
    excessive stocks in the United States to provide a continuous
    and stable supply of the different qualities of cotton needed
    in the United States and in foreign cotton consuming countries,
    and for purposes of national security but the Secretary, in
    making such adjustments, may not reduce the national marketing
    quota or any year below (i) one million bales less than the
    estimated domestic consumption and estimated exports for the
    marketing year for which such quota is being proclaimed, or
    (ii) ten million bales, whichever is larger. Such proclamation
    shall be made not later than October 15 of the calendar year in
    which such determination is made. Notwithstanding any other
    provision of this Act, the national marketing quota for upland
    cotton for 1959 and subsequent years shall be not less than the
    number of bales required to provide a national acreage
    allotment for each such year of sixteen million acres.
      [Sec. 342a. The Secretary shall, not later than November 15,
    of the calendar years 1970 through 1976, proclaim a national
    cotton production goal for the 1971 and subsequent crops of
    upland cotton. The national cotton production goal for any year
    shall be the number of bales of upland cotton (standard bales
    of four hundred and eighty pounds net weight) equal to the
    estimated domestic consumption and estimated exports for the
    marketing year beginning in the calendar year for which such
    national cotton production goal is proclaimed, plus an
    allowance of not less than 5 per centum of such estimated
    consumption and estimated exports for market expansion except
    that the Secretary shall make such adjustments in the amount of
    such production goal as he determines necessary after taking
    into consideration the estimated stocks of upland cotton in the
    United States (including the qualities of such stocks) and
    stocks in foreign countries, which would be available for the
    marketing year, to assure the maintenance of adequate but not
    excessive carryover stocks in the United States (not less than
    50 per centum of the average offtake for the three preceding
    marketing years) to provide a continuous and stable supply of
    the different qualities of upland cotton needed in the United
    States and in foreign cotton consuming countries and, in
    addition, to provide an adequate reserve for purposes of
    national security.

                                  [REFERENDUM

      [Sec. 343. Not later than December 15 following the issuance
    of the marketing quota proclamation provided for in section
    342, the Secretary shall conduct a referendum, by secret
    ballot, of farmers engaged in the production of cotton in the
    calendar year in which the referendum is held, to determine
    whether such farmers are in favor of or opposed to the quota so
    proclaimed: Provided, That If more than one third of the
    farmers voting in the referendum oppose the national marketing
    quota, such quota shall become ineffective upon proclamation of
    the results of the referendum. The Secretary shall proclaim the
    results of any referendum held hereunder within thirty days
    after the date of such referendum. Notwithstanding any other
    provision hereof the referendum with respect to the national
    marketing quota for cotton for the marketing year beginning
    August 1, 1986, may be conducted not later than thirty-one days
    after adjournment sine die of the first session of the Ninety-
    ninth Congress.

                              [ACREAGE ALLOTMENTS

      [Sec. 344. (a) Whenever a national marketing quota is
    proclaimed under section 342, the Secretary shall determine and
    proclaim a national acreage allotment for the crop of cotton to
    be produced in the next calendar year. The national acreage
    allotment for cotton shall be that acreage, based upon the
    national average yield per acre of cotton for the four years
    immediately preceding the calendar year in which the national
    marketing quota is proclaimed, required to make available from
    such crop an amount of cotton equal to the national marketing
    quota.
      [(b) The national acreage allotment for cotton for 1953 and
    subsequent years shall be apportioned to the States on the
    basis of the acreage planted to cotton (including the acreages
    regarded as having been planted to cotton under the provisions
    of Public Law 12, Seventy-ninth Congress) during the five
    calendar years immediately preceding the calendar year in which
    the national marketing quota is proclaimed, with adjustments
    for abnormal weather conditions during such period: Provided,
    That there is hereby established a national acreage reserve
    consisting of three hundred and ten thousand acres which shall
    be in addition to the national acreage allotment; and such
    reserve shall be apportioned to the States on the basis of
    their needs for additional acreage for establishing minimum
    farm allotments under subsection (f)(1), as determined by the
    Secretary without regard to State and count acreage reserves
    (except that the amount apportioned to Nevada sell be one
    thousand acres). For the 1960 and succeeding crops of cotton,
    the needs of States (other than Nevada) for such additional
    acreage for such purpose may be estimated by the Secretary,
    after taking into consideration such needs as determined or
    estimated for the preceding crop of cotton and the size of the
    national acreage allotment for such crop. The additional
    acreage so apportioned to the State shall be apportioned to the
    counties on the basis of the needs of the counties for such
    additional acreage for such purpose, and added to the county
    acreage allotment for apportionment to farms pursuant to
    subsection (f) of this section (except that no part of such
    additional acreage shall be used to increase the county reserve
    above 15 per centum of the county allotment determined without
    regard to such additional acreage). Additional acreage
    apportioned to a State for any year under the foregoing proviso
    shall not be taken into account in establishing future State
    acreage allotments. Needs for additional acreage under the
    foregoing provisions and under the last provision in subsection
    (e) shall be determined or estimated as though allotments were
    first computed without regard to subsection (f)(1).
      [(e) The State acreage allotment for cotton shall be
    apportioned to counties on the same basis as to years and
    conditions as is applicable to the State under subsections (b),
    (c), and (d) of this section: Provided, That the State
    committee may reserve not to exceed 10 per centum of its State
    acreage allotment (15 per centum if the State's 1948 planted
    acreage was in excess of one million acres and less than half
    its 1943 allotment) which shall be used to make adjustments in
    county allotments for trends in acreage, for counties adversely
    affected by abnormal conditions affecting plantings, or for
    small or new farms, or to correct inequities in farm allotments
    and to prevent hardship: Provided further, That if the
    additional acreage allocated to a State under the proviso in
    subsection (b) is less than the requirements as determined or
    estimated by the Secretary for establishing minimum farm
    allotments for the State under subsection (f)(1), the acreage
    reserved under this subsection shall not be less than the
    smaller of (1) the remaining acreage so determined or estimated
    to be required for establishing minimum farm allotments or (2)
    3 per centum of the State acreage allotment; and the acreage
    which is required to be reserved under this proviso shall be
    allocated to counties on the basis of their needs for
    additional acreage for establishing minimum farm allotments
    under subsection (f)(1), and added to the county acreage
    allotment for apportionment to farms pursuant to subsection (f)
    of this section (except that no part of such additional acreage
    shall be used to increase the county reserve above 15 per
    centum of the county allotment determined without regard to
    such additional acreages).
      [(f) The county acreage allotment, less not to exceed the
    percentage provided for in paragraph (3) of this subsection
    shall be apportioned to farms on which cotton has been planted
    (or regarded as having been planted under the provisions of
    Public Law 12, Seventy-ninth Congress) in any one of the three
    years immediately preceding the year for which such allotment
    is determined on the following basis:
              [(1) Insofar as such acreage is available, there
            shall be allotted the smaller of the following: (A) ten
            acres; or (B) the acreage allotment established for the
            farm for the 1958 crop.
              [(2) The remainder shall be allotted to farms other
            than farms to which an allotment has been made under
            paragraph (1)(B) so that the allotment to each farm
            under this paragraph together with the amount of the
            allotment to such farm under paragraph (1)(A) shall be
            a prescribed percentage (which percentage shall be the
            same for all such farms in the county or administrative
            areas) of the acreage, during the preceding year, on
            the farm which is tilled annually or in regular
            rotation, excluding from such acreages the acres
            devoted to the production of sugar cane for sugar,
            sugar beets for sugar, wheat, tobacco, or rice for
            market; peanuts picked and threshed; wheat or rice or
            feeding to livestock for market; or lands determined to
            be voted primarily to orchards or vineyards, and
            nonirrigated lands in irrigated area: Provided,
            however, That if a farm would be allotted under this
            paragraph an acreage together with the amount of the
            allotment to such farm under paragraph (1)(A) in excess
            of the largest acreage planted (and regarded as planted
            under Public Law 12, Seventy-ninth Congress) to cotton
            during any of the preceding three years, the acreage
            allotment for such farm shall not exceed such largest
            acreage so planted (and regarded as planted under
            Public Law 12, Seventy-ninth Congress) in any such
            year.
              [(3) The county committee may reserve not in excess
            of 15 per centum of the county allotment which, in
            addition to the acreage made available under the
            proviso in subsection (e), shall be used for (A)
            establishing allotments for farms on which cotton was
            not planted (or regarded as planted under Public Law
            12, Seventy-ninth Congress) during any of the three
            calendar years immediately preceding the year for which
            the allotment is made, on the basis of land, labor, and
            equipment available for the production of cotton, crop
            rotation practices, and the soil and other physical
            facilities affecting the production of cotton; and (B)
            making adjustments of the farm acreage allotments
            established under paragraphs (1) and (2) of this
            subsection so as to establish allotments which are fair
            and reasonable in relation to the factors set forth in
            this paragraph and abnormal conditions of production on
            such farms, or in making adjustments in farm acreage
            allotments to correct inequities and to prevent
            hardship: Provided, That not less than 20 percent of
            the acreage reserved under this subsection shall, to
            the extent required, be allotted upon such basis as the
            Secretary deems fair and reasonable to farms (other
            than farms to which an allotment has been made under
            subsection (f)(1)(B), if any, to which an allotment of
            not exceeding fifteen acres may be made under other
            provisions of this subsection.
              [(6) Notwithstanding the provisions of paragraph (2)
            of this subsection, if the county committee recommends
            such action and the Secretary determines that such
            action will result in a more equitable distribution of
            the county allotment among farms in the county, the
            remainder of the county acreage allotment (after making
            allotments as provided in paragraph (1) of this
            subsection) shall be allotted to farms other than farms
            to which an allotment has been made under paragraph
            (1)(B) of this subsection so that the allotment to each
            farm under this paragraph together with the amount of
            the allotment of such farm under paragraph (1)(A) of
            this subsection shall be a prescribed percentage (which
            percentage shall be the same for all such farms in the
            county) of the average acreage planted to cotton on the
            farm during the three years immediately preceding the
            year for which such allotment is determined, adjusted
            as may be necessary for abnormal conditions affecting
            plantings during such three year period: Provided, That
            the county committee may in its discretion limit any
            farm acreage allotment established under the provisions
            of this paragraph for any year to an acreage not in
            excess of 50 per centum of the cropland on the farm, as
            determined pursuant to the provisions of paragraph (2)
            of this subsection: Provided further, That any part of
            the county acreage allotment not apportioned under this
            paragraph by reason of the initial application of such
            50 per centum limitation shall be added to the county
            acreage reserve under paragraph (3) of this subsection
            and shall be available for the purposes specified
            therein. If the county acreage allotment is apportioned
            among the farms of the county in accordance with the
            provisions of this paragraph, the acreage reserved
            under paragraph (3) of this subsection may be used to
            make adjustments so as to establish allotments which
            are fair and reasonable to farms receiving allotments
            under this paragraph in relation to the factors set
            forth in paragraph (3).
              [(7)(A) In the event that any farm acreage allotment
            is less than that prescribed by paragraph (1), such
            acreage allotment shall be increased to the acreage
            prescribed by paragraph (1). The additional acreage
            required to be allotted to farms under this paragraph
            shall be in addition to the county, State, and national
            acreage allotments and the production from such acreage
            shall be in addition to the national marketing quota.
              [(B) Notwithstanding any other provision of law--
                      [(i) the acreage by which any farm acreage
                    allotment for 1959 or any subsequent crop
                    established under paragraph (1) exceeds the
                    acreage which would have been allotted to such
                    farm if its allotment had been computed on the
                    basis of the same percentage factor applied to
                    other farms in the county under paragraph (2),
                    (6), or (8) shall not be taken into account in
                    establishing the acreage allotment for such
                    farm for any crop for which acreage is allotted
                    to such farm under paragraph (2), (6), or (8);
                    and acreage shall be allotted under paragraph
                    (2), (6), or (8) to farms which did not receive
                    1958 crop allotments in excess of ten acres if
                    and only if the Secretary determines (after
                    considering the allotments to other farms in
                    the county for such crop compared with their
                    1958 allotments and other relevant factors)
                    that equity and justice require the allotment
                    of additional acreage to such farm under
                    paragraph (2), (6), or (8),
                      [(ii) the acreage by which any county acreage
                    allotment for 1959 or any subsequent crop is
                    increased from the national or State reserve on
                    the basis of its needs for additional acreage
                    for establishing minimum farm allotments shall
                    not be taken into account in establishing
                    future county acreage allotments, and
                      [(iii) the additional acreage allotted
                    pursuant to subparagraph (A) of this paragraph
                    (7) shall not be taken into account in
                    establishing future State, county, or farm
                    acreage allotments.
              [(8) Notwithstanding the foregoing provisions of
            paragraphs (2) and (6) of this subsection, the
            Secretary shall, if allotments were in effect the
            preceding year, provide for the county acreage
            allotment for the 1959 and succeeding crops of cotton,
            less the acreage reserved under paragraph (3) of this
            subsection, to be apportioned to farms on which cotton
            has been planted in any one of the three years
            immediately preceding the year for which such allotment
            is determined, on the basis of the farm acreage
            allotment for the year immediately preceding the year
            for which such apportionment is made, adjusted as may
            be necessary (i) for any change in the acreage of
            cropland available for the production of cotton, or
            (ii) to meet the requirements of any provision (other
            than those contained in paragraphs (2) and (6)) with
            respect to the counting of acreage for history
            purposes: Provided, That, beginning with allotments
            established for the 1961 crop of cotton, if the acreage
            actually planted (or regarded as planted under the Soil
            Bank Act, the Great Plains program, and the release and
            reapportionment provisions of subsection (m)(2) of this
            section) to cotton on the farm in the preceding year
            was less than 75 per centum of the farm allotment for
            such year or, in the case of a farm which qualified for
            price support on the crop produced in such year under
            section 103(b) of the Agricultural Act of 1949, as
            amended, 75 per centum of the farm domestic allotment
            established under section 350 for such year, whichever
            is smaller, in lieu of using such allotment as the farm
            base as provided in this paragraph, the base shall be
            the average of (1) the cotton acreage for the farm for
            the preceding year as determined for purposes of this
            proviso and (2) the allotment established for the farm
            pursuant to the provisions of this subsection (f) for
            such preceding year; and the 1958 allotment used for
            establishing the minimum farm allotment under paragraph
            (1) of this subsection (f) shall be adjusted to the
            average acreage so determined. The base for a farm
            shall not be adjusted as provided in this paragraph if
            the county committee determines that failure to plant
            at least 75 per centum of the farm allotment was due to
            conditions beyond the control of producers on the farm.
            The Secretary shall establish limitations to prevent
            allocations of allotment to farms not affected by the
            foregoing proviso, which would be excessive on the
            basis of the cropland, past cotton acreage, allotments
            for other commodities, and good soil conservation
            practices on such farms.
      [(g) Notwithstanding the foregoing provisions of this
    section--
              [(1) State, county, and farm acreage allotments and
            yields for cotton shall be established in conformity
            with Public Law 28, Eighty-first Congress.
              [(2) In apportioning the county allotment among the
            farms within the county, the Secretary, through the
            local committees, shall take into consideration
            different conditions within separate administrative
            areas within a county if any exist, including types,
            kinds, and productivity of the soil so as to prevent
            discrimination among the administrative areas of the
            county.
      [(i) Notwithstanding any other provision of this Act, any
    acreage planted to cotton in excess of the farm acreage
    allotment shall not be taken into account in establishing
    State, county, and farm acreage allotments. Notwithstanding any
    other provision of this Act, beginning with the 1960 crop the
    planting of cotton on a farm in any of the immediately
    preceding three years that allotments were in effect but no
    allotment was established for such farm for any year of such
    three year period shall not make the farm eligible for an
    allotment as an old farm under subsection (f) of this section:
    Provided, however, That by reason of such planting the farm
    need not be considered as ineligible for a new farm allotment
    under subsection (f)(3) of this section.
      [(j) Notwithstanding any other provision of this Act, State
    and county committees shall make available for inspection by
    owners or operators of farms receiving cotton acreage
    allotments all records pertaining to cotton acreage allotments
    and marketing quotas.
      [(k) Notwithstanding any other provision of this section
    except subsection (g)(1), there shall be allotted to each State
    for which an allotment is made under this section not less than
    the smaller of (A) four thousand acres or (B) the highest
    acreage planted to cotton in any one of the three calendar
    years immediately preceding the year for which the allotment is
    made.
      [(m) Notwithstanding any other provision of law--
              [(1) (Applicable only to 1954 crop of cotton.)
              [(2) Any part of any farm cotton acreage allotment on
            which cotton will not be planted and which is
            voluntarily surrendered to the county committee shall
            be deducted from the allotment to such farm and may be
            reapportioned by the county committee to other farms in
            the same county receiving allotments in amounts
            determined by the county committee to be fair and
            reasonable on the basis of past acreage of cotton,
            land, labor, equipment available for the production of
            cotton, crop rotation practices, and soil and other
            physical facilities affecting the production of cotton.
            If all of the allotted acreage voluntarily surrendered
            is not needed in the county, the county committee may
            surrender the excess acreage to the State committee to
            be used for the same purposes as the State acreage
            reserve under subsection (e) of this section. Any
            allotment released under this provision shall be
            regarded for the purposes of establishing future
            allotments as having been planted on the farm and in
            the county where the release was made rather than on
            the farm and in the county to which the allotment was
            transferred, except that this shall not operate to make
            the farm from which the allotment was transferred
            eligible for an allotment as having cotton planted
            thereon during the three-year base period: Provided,
            That notwithstanding any other provisions of law, any
            part of any farm acreage allotment may be permanently
            released in writing to the county committee by the
            owner and operator of the farm, and reapportioned as
            provided herein. Acreage released under this paragraph
            shall be credited to the State in determining future
            allotments. The provisions of this paragraph shall
            apply also to extra long staple cotton covered by
            section 341 of this Act.
      [(n) Notwithstanding any other provision of this Act, if the
    Secretary determines for any year that because of a natural
    disaster a portion of the farm cotton acreage allotments in a
    county cannot be timely planted or replanted in such year, he
    may authorize for such year the transfer of all or part of the
    cotton acreage allotment for any farm in the county so affected
    to another farm in the county or in an adjoining county on
    which one or more of the producers on the farm from which the
    transfer is to be made will be engaged in the production of
    cotton and will share in the proceeds thereof, in accordance
    with such regulations as the Secretary may prescribe. Any farm
    allotment transferred under this paragraph shall be deemed to
    be released acreage for the purpose of acreage history credits
    under section 344(f)(8), 344(m)(2), and 377 of this Act:
    Provided, That, notwithstanding the provisions of section
    344(m)(2) of this Act, the transfer of any farm allotment under
    this subsection for any year shall operate to make the farm
    from which the allotment was transferred eligible for an
    allotment as having cotton planted thereon during the three-
    year base period.

         [SALES, LEASE AND TRANSFER OF UPLAND COTTON ACREAGE ALLOTMENTS

      [Sec. 344a. (a) Notwithstanding any other provision of law,
    the Secretary, if he determines that it will not impair the
    effective operation of the program involved, (1) may permit the
    owner and operator of any farm for which a cotton acreage
    allotment is established to sell or lease all or any part or
    the right to all or any part of such allotment (excluding that
    part of the allotment which the Secretary determines was
    apportioned to the farm from the national acreage reserve) to
    any other owner or operator of a farm for transfer to such
    farm; (2) may permit the owner of a farm to transfer all or any
    part of such allotment to any other farm owned or controlled by
    him: Provided, That the authority granted under this section
    may be exercised for the calendar years 1966 through 1970, but
    all transfers hereunder shall be for such period of years as
    the parties thereto may agree.
      [(b) Transfers under this section shall be subject to the
    following conditions: (i) no allotment shall be transferred to
    a farm in another State or to a person for use in another
    State; (ii) no farm allotment may be sold or leased for
    transfer to a farm in another county unless the producers of
    cotton in the county from which transfer is being made have
    voted in a referendum within three years of the date of such
    transfer, by a two-thirds majority of the producers
    participating in such referendum, to permit the transfer of
    allotments to farms outside the county, which referendum,
    insofar as practicable, shall be held in conjunction with the
    marketing quota referendum for the commodity; (iii) no transfer
    of an allotment from a farm subject to a mortgage or other lien
    shall be permitted unless the transfer is agreed to by the
    lien-holder; (iv) no sale of a farm allotment shall be
    permitted if any sale of cotton allotment to the same farm has
    been made within the three immediately preceding crop years;
    (v) the total cotton allotment for any farm to which allotment
    is transferred by sale or lease shall not exceed the farm
    acreage allotment (excluding reapportioned acreage) established
    for such farm for 1965 by more than one hundred acres; (vi) the
    cotton in excess of the remaining acreage allotment on the farm
    shall be planted on any farm from which the allotment (or part
    of an allotment) is sold for a period of five years following
    such sale, nor shall any cotton in excess of the remaining
    acreage allotment on the farm be planted on any farm from which
    the allotment (or part of an allotment) is leased during the
    period of such lease, and the producer on such farm shall so
    agree as a condition precedent to the Secretary's approval of
    any such sale or lease; and (vii) no transfer of allotment
    shall be effective until a record thereof is filed with the
    county committee of the county to which such transfer is made
    and such committee determines that the transfer complies with
    the provisions of this section. Such record may be filed with
    such committee only during the period beginning June 1 and
    ending December 31.
      [(c) The transfer of an allotment shall have the effect of
    transferring also the acreage history, farm base, and marketing
    quota attributable to such allotment and if the transfer is
    made prior to the determination of the allotment for any year
    the transfer shall include the right of the owner or operator
    to have an allotment determined for the farm for such year:
    Provided, That in the case of a transfer by lease, the amount
    of the allotment shall be considered for purposes of
    determining allotments after the expiration of the lease to
    have been planted on the farm from which such allotment is
    transferred.
      [(d) The land in the farm from which the entire cotton
    allotment and acreage history have been transferred shall not
    be eligible for a new farm cotton allotment during the five
    years following the year in which such transfer is made.
      [(e) The transfer of a portion of a farm allotment which was
    established under minimum farm allotment provisions for cotton
    or which operates to bring the farm within the minimum farm
    allotment provision for cotton shall cause the minimum farm
    allotment or base to be reduced to an amount equal to the
    allotment remaining on the farm after such transfer.
      [(f) The Secretary shall prescribe regulations for the
    administration of this section, which shall include provisions
    for adjusting the size of the allotment transferred if the farm
    to which the allotment is transferred has a substantially
    higher yield per acre and such other terms and conditions as he
    deems necessary.
      [(g) If the sale or lease occurs during a period in which the
    farm is covered by a conservation reserve contract, cropland
    conversion agreement, cropland adjustment agreement, or other
    similar land utilization agreement, the rates of payment
    provided for in the contract or agreement of the farm from
    which the transfer is made shall be subject to an appropriate
    adjustment, but no adjustment shall be made in the contract or
    agreement of the farm to which the allotment is transferred.
      [(h) The Secretary shall by regulations authorize the
    exchange between farms in the same county, or between farms in
    adjoining counties within a State, of cotton acreage allotment
    for rice acreage allotment. Any such exchange shall be made on
    the basis of application filed with the county committee by the
    owners and operators of the farms, and the transfer of
    allotment between the farms shall include transfer of the
    related acreage history for the commodity. The exchange shall
    be acre for acre or on such other basis as the Secretary
    determines is fair and reasonable, taking into consideration
    the comparative productivity of the soil for the farms involved
    and other relevant factors. No farm from which the entire
    cotton or rice allotment has been transferred shall be eligible
    for an allotment of cotton or rice as a new farm within a
    period of five crop years after the date of such exchange.
      [(i) The provisions of this section relating to cotton shall
    apply only to upland cotton.

                             [FARM MARKETING QUOTAS

      [Sec. 345. The farm marketing quota for any crop of cotton
    shall be the actual production of the acreage planted to cotton
    on the farm less the farm marketing excess. The farm marketing
    excess shall be the normal production of that acreage planted
    to cotton on the farm which is in excess of the farm acreage
    allotment: Provided, That such farm marketing excess shall not
    be larger than the amount by which the actual production of
    cotton on the farm exceeds the normal production of the farm
    acreage allotment, if the producer establishes such actual
    production to the satisfaction of the Secretary.

                       [PENALTIES; EXPORT MARKET ACREAGE

      [Sec. 346. (a) Whenever farm marketing quotas are in effect
    with respect to any crop of cotton the producer shall be
    subject to a penalty on the farm marketing excess at a rate per
    pound equal to 50 per centum of the parity price per pound for
    cotton as of June 15 of the calendar year in which such crop is
    produced.
      [(b) The farm marketing excess of cotton shall be regarded as
    available for marketing and the amount of penalty shall be
    computed upon the normal production of the acreage on the farm
    planted to cotton in excess of the farm acreage allotment. If a
    downward adjustment in the amount of the farm marketing excess
    is made pursuant to the proviso in section 345, the difference
    between the amount of the penalty computed upon the farm
    marketing excess before such adjustment and as computed upon
    the adjusted farm marketing excess shall be returned to or
    allowed the producer.
      [(c) The person liable for payment or collection of the
    penalty shall be liable also for interest thereon at the rate
    of 6 per centum per annum from the date the penalty becomes due
    until the date of payment of such penalty.
      [(d) Until the penalty on the farm marketing excess is paid,
    all cotton produced on the farm and marketed by the producers
    shall be subject to the penalty provided by this section and a
    lien on the entire crop of cotton produced on the farm shall be
    in effect in favor of the United States.

                        [PART V--MARKETING QUOTAS--RICE

                             [LEGISLATIVE FINDINGS

      [Sec. 351. (a) The marketing of rice constitutes one of the
    great basic industries of the United States with ramifying
    activities which directly affect interstate and foreign
    commerce at every point, and stable conditions therein are
    necessary to the general welfare. Rice produced for market is
    sold on a Nation-wide market, and, with its products, moves
    almost wholly in interstate and foreign commerce from the
    producer to the ultimate consumer. The farmers producing such
    commodity are subject in their operations to uncontrollable
    natural causes, in many cases such farmers carry on their
    farming operations on borrowed money or leased lands, and are
    not so situated as to be able to organize effectively, as can
    labor and industry, through unions and corporations enjoying
    Government sanction and protection for joint economic action.
    For these reasons, among others, the farmers are unable without
    Federal assistance to control effectively the orderly marketing
    of such commodity with the result that abnormally excessive
    supplies thereof are produced and dumped indiscriminately on
    the Nation-wide market.
      [(b) The disorderly marketing of such abnormally excessive
    supplies affects, burdens, and obstructs interstate and foreign
    commerce by (1) materially affecting the volume of such
    commodity marketed therein, (2) disrupting the orderly
    marketing of such commodity therein, (3) reducing the prices
    for such commodity with consequent injury and destruction of
    such commerce in such commodity, and (4) causing a disparity
    between the prices for such commodity in interstate and foreign
    commerce and industrial products therein, with a consequent
    diminution of the volume of interstate and foreign commerce in
    industrial products.
      [(c) Whenever an abnormally excessive supply of rice exists,
    the marketing of such commodity by the producers thereof
    directly and substantially affects interstate and foreign
    commerce in such commodity and its products, and the operation
    of the provisions of this part becomes necessary and
    appropriate in order to promote, foster, and maintain an
    orderly flow of such supply in interstate and foreign
    commerce.]

                       PART VI--MARKETING QUOTAS--PEANUTS

              * * * * * * *

                               [MARKETING QUOTAS

      [Sec. 358. (a) Between July 1 and December 1 of each calendar
    year the Secretary shall proclaim the amount of the national
    marketing quota for peanuts for the crop produced in the next
    succeeding calendar year in terms of the total quantity of
    peanuts which will make available for marketing a supply of
    peanuts from the crop with respect to which the quota is
    proclaimed equal to the average quantity of peanuts harvested
    for nuts during the five years immediately preceding the year
    in which such quota is proclaimed, adjusted for current trends
    and prospective demand conditions, and the quota so proclaimed
    shall be in effect with respect to such crop. The national
    marketing quota for peanuts for any year shall be converted to
    a national acreage allotment by dividing such quota by the
    normal yield per acre of peanuts for the United States
    determined by the Secretary on the basis of the average yield
    per acre of peanuts in the five years preceding the year in
    which the quota is proclaimed, with such adjustments as may be
    found necessary to correct for trends in yields and for
    abnormal conditions of production affecting yields in such five
    years: Provided, That the national marketing quota established
    for the crop produced in the calendar year 1941 shall be a
    quantity of peanuts sufficient to provide a national acreage
    allotment of not less than one million six hundred and ten
    thousand acres, and that the national marketing quota
    established for any subsequent year shall be a quantity of
    peanuts sufficient to provide a national acreage allotment of
    not less than that established for the crop produced in the
    calendar year 1941.
      [(b) Not later than December 15 of each calendar year the
    Secretary shall conduct a referendum of farmers engaged in the
    production of peanuts in the calendar year in which the
    referendum is held to determine whether such farmers are in
    favor of or opposed to marketing quotas with respect to the
    crops of peanuts produced in the three calendar years
    immediately following the year in which the referendum is held,
    except that, if as many as two-thirds of the farmers voting in
    any referendum vote in favor of marketing quotas, no referendum
    shall be held with respect to quotas for the second and third
    years of the period. The Secretary shall proclaim the results
    of the referendum within thirty days after the date on which it
    is held, and, if more than one-third of the farmers voting in
    the referendum vote against marketing quotas, the Secretary
    also shall proclaim that marketing quotas will not be in effect
    with respect to the crop of peanuts produced in the calendar
    year immediately following the calendar year in which the
    referendum is held. Notwithstanding any other provision hereof,
    the referendum with respect to marketing quotas for the crops
    of peanuts produced in the 1986, 1987, and 1988 calendar years
    may be conducted not later than thirty-one days after
    adjournment sine die of the first session of the Ninety-ninth
    Congress.
      [(c)(1) The national acreage allotment for 1951, less the
    acreage to be allotted to new farms under subsection (f) of
    this section, shall be apportioned among the States on the
    basis of the larger of the following for each State: (a) The
    acreage allotted to the State as its share of the 1950 national
    acreage allotment of two million one hundred thousand acres, or
    (b) the State's share of two million one hundred thousand acres
    apportioned, to States on the basis of the average acreage
    harvested for nuts in each State in the five years 1945-49:
    Provided, That any allotment so determined for any State which
    is less than the 1951 State allotment announced by the
    Secretary prior to the enactment of this Act shall be increased
    to such announced allotment and the acreage required for such
    increases shall be in addition to the 1951 national acreage
    allotment and shall be considered in determining State acreage
    allotments in future years. For any year subsequent to 1951,
    the national acreage allotment for that year, shall be
    apportioned among the States on the basis of their share of the
    national acreage allotment for the most recent year in which
    such apportionment was made:
      [(2) Notwithstanding any other provision of law, if the
    Secretary of Agriculture determines, on the basis of the
    average yield per acre of peanuts by types during the preceding
    five years, adjusted for trends in yields and abnormal
    conditions of production affecting yields in such five years,
    that the supply of any type or types of peanuts for any
    marketing year, beginning with the 1951-52 marketing year, will
    be insufficient to meet the estimated demand for cleaning and
    shelling purposes at prices at which the Commodity Credit
    Corporation may sell for such purposes peanuts owned or
    controlled by it, the State allotments for those States
    producing such type or types of peanuts shall be increased to
    the extent determined by the Secretary to be required to meet
    such demand but the allotment for any State may not be
    increased under this provision above the 1947 harvested acreage
    of peanuts for such State. The total increase so determined
    shall be apportioned among such States for distribution among
    farms producing peanuts of such type or types on the basis of
    the average acreage of peanuts of such type or types in the
    three years immediately preceding the year for which the
    allotments are being determined. The additional acreage so
    required shall be in addition to the national acreage
    allotment, the production from such acreage shall be in
    addition to the national marketing quota, and the increase in
    acreage allotted under this provision shall not be considered
    in establishing future State, county, or farm acreage
    allotments.
      [(d) The Secretary shall provide for the apportionment of the
    State acreage allotment for any State, less the acreage to be
    allotted to new farms under subsection (f) of this section,
    through local committees among farms on which peanuts were
    grown in any of the three years immediately preceding the year
    for which such allotment is determined. The State acreage
    allotment for 1952 and any subsequent year shall be apportioned
    among farms on which peanuts were produced in any one of the 3
    calendar years immediately preceding the year for which such
    apportionment is made, on the basis of the following: Past
    acreage of peanuts, taking into consideration the acreage
    allotments previously established for the farm; abnormal
    conditions affecting acreage; land, labor, and equipment
    available for the production of peanuts; crop-rotation
    practices; and soil and other physical factors affecting the
    production of peanuts. Any acreage of peanuts harvested in
    excess of the allotted acreage for any farm for any year shall
    not be considered in the establishment of the allotment for the
    farm in succeeding years. The amount of the marketing quota for
    each farm shall be the actual production of the farm-acreage
    allotment, and no peanuts shall be marketed under the quota for
    any farm other than peanuts actually produced on the farm.
      [(e) Notwithstanding the foregoing provisions of this
    section, the Secretary may, if the State committee recommends
    such action and the Secretary determines that such action will
    facilitate the effective administration of the provisions of
    the Act, provide for the apportionment of the State acreage
    allotment for 1952 and any subsequent year among the counties
    in the State on the basis of the past acreage of peanuts
    harvested for nuts (excluding acreage in excess of farm
    allotments) in the county during the five years immediately
    preceding the year in which such apportionment is made, with
    such adjustments as are deemed necessary for abnormal
    conditions affecting acreage, for trends in acreage, and for
    additional allotments for types of peanuts in short supply
    under the provisions of subsection (c). The county acreage
    allotment shall be apportioned among farms on the basis of the
    factors set forth in subsection (d) of this section.
      [(f) Not more than 1 per centum of the State acreage
    allotment shall be apportioned among farms in the State on
    which peanuts are to be produced during the calendar year for
    which the allotment is made but on which peanuts were not
    produced during any one of the past three years, on the basis
    of the following: Past peanut-producing experience by the
    producers; land, labor, and equipment available for the
    production of peanuts; crop-rotation practices; and soil and
    other physical factors affecting the production of peanuts.
      [(g) Any part of the acreage allotted to individual farms
    under the provisions of this section on which peanuts will not
    be produced and which is voluntarily surrendered to the county
    committee shall be deducted from the allotments to such farms
    and may be reapportioned by the county committee to other farms
    in the same county receiving allotments, in amounts determined
    by the county committee to be fair and reasonable on the basis
    of land, labor, and equipment available for the production of
    peanuts, crop-rotation practices, and soil and other physical
    factors affecting the production of peanuts. Any transfer of
    allotments under this provision shall not operate to reduce the
    allotment for any subsequent year for the farm from which
    acreage is transferred, except as the farm becomes ineligible
    for an allotment by failure to produce peanuts during a three-
    year period, and any such transfer shall not operate to
    increase the allotment for any subsequent year for the farm to
    which the acreage is transferred: [Provided, That,
    notwithstanding any other provisions of this Act, any part of
    any farm acreage allotment may be permanently released in
    writing to the county committee by the owner and operator of
    the farm, and reapportioned as provided herein.
      [(i) The production of peanuts on a farm in 1959 or any
    subsequent year for which no farm acreage allotment was
    established shall not make the farm eligible for an allotment
    as an old farm under subsection (d) of this section: Provided,
    however, That by reason of such production the farm need not be
    considered as ineligible for a new farm allotment under
    subsection (f) of this section, but such production shall not
    be deemed past experience in the production of peanuts for any
    producer on the farm.
      [(j) Notwithstanding any other provision of this Act, if the
    Secretary determines for 1976 or a subsequent year that because
    of a natural disaster a portion of the farm peanut acreage
    allotments in a county cannot be timely planted or replanted in
    such year, he may authorize for such year the transfer of all
    or a part of the peanut acreage allotments for any farm in the
    county so affected to another farm in the county or in an
    adjoining county in the same or an adjoining State on which one
    or more of the producers on the farm from which the transfer is
    to be made will be engaged in the production of peanuts and
    will share in the proceeds thereof, in accordance with such
    regulations as the Secretary may prescribe. Any farm allotment
    transferred under this subsection shall be deemed to be
    released acreage for the purpose of acreage history credits
    under subsection (g) of this section and section 377 of this
    Act: Provided, That notwithstanding the provisions of
    subsection (g) of this section, the transfer of any farm
    allotment under this subsection shall operate to make the farm
    from which the allotment was transferred eligible for an
    allotment as having peanuts planted thereon during the three-
    year base period.]

    SEC. 358-1. NATIONAL POUNDAGE QUOTAS AND ACREAGE ALLOTMENTS FOR [1991
                        THROUGH 1997 CROPS OF] PEANUTS.

      (a) National Poundage Quotas.--
              (1) Establishment.--The national poundage quota for
            peanuts for each [of the 1991 through 1997 marketing
            years] marketing year shall be established by the
            Secretary at a level that is equal to the quantity of
            peanuts (in tons) that the Secretary estimates will be
            devoted in each such marketing year to [domestic
            edible, seed,] domestic edible use and related uses.
            [Notwithstanding any other provision of this paragraph,
            the national poundage quota for a marketing year shall
            not be less than 1,350,000 tons.]
              (2) Announcement.--The national poundage quota for a
            marketing year shall be announced by the Secretary not
            later than December 15 preceding the marketing year.
              (3) Apportionment among states.--The national
            poundage quota established under paragraph (1) shall be
            apportioned among the States so that the poundage quota
            allocated to each State shall be equal to the
            percentage of the national poundage quota allocated to
            farms in the State for [1990] 1990, for the 1991
            through 1995 marketing years, and 1995, for the 1996
            through 2002 marketing years.
      (b) Farm Poundage Quotas.--
              (1) In general.--
                      (A) Establishment.--A farm poundage quota for
                    [each of the 1991 through 1997 marketing years]
                    each marketing year shall be established--
                              (i) for each farm that had a farm
                            poundage quota for peanuts for the 1990
                            marketing year, in the case of the 1991
                            through 1995 marketing years, and the
                            1995 marketing year, in the case of the
                            1996 through 2002 marketing years;
              * * * * * * *
                      (B) Quantity.--The farm poundage quota for
                    each [of the 1991 through 1997 marketing years]
                    marketing year for each farm described in
                    subparagraph (A)(i) shall be the same as the
                    farm poundage quota for the farm for the
                    immediately preceding marketing year, as
                    adjusted under paragraph (2), but not
                    [including--
                              [(i) any increases for
                            undermarketings from previous years; or
                              [(ii) any increases resulting from
                            the allocation of quotas voluntarily
                            released for 1 year under paragraph
                            (7).] including any increases resulting
                            from the allocation of quotas
                            voluntarily released for 1 year under
                            paragraph (7).
                    The farm poundage quota, if any, for each of
                    the 1991 through 1997 marketing years for each
                    farm described in subparagraph (A)(ii) shall be
                    equal to the quantity of peanuts allocated to
                    the farm for the year under paragraph (2).
                      (C) Transfers.--For purposes of this
                    subsection, if the farm poundage quota, or any
                    part thereof, is permanently transferred in
                    accordance with section 358a or 358b, the
                    receiving farm shall be considered as
                    possessing the farm poundage quota (or portion
                    thereof) of the transferring farm for all
                    subsequent marketing years.
                      (D) Certain farms ineligible to hold quota.--
                    Effective beginning with the 1997 marketing
                    year, the Secretary shall no longer establish
                    farm poundage quotas under subparagraph (A) for
                    farms--
                              (i) owned or controlled by
                            municipalities, airport authorities,
                            schools, colleges, refuges, and other
                            public entities (not including
                            universities for research purposes); or
                              (ii) owned or controlled by a person
                            who is not a producer and resides in
                            another State.
              (2) Adjustments.--
                      (A) Allocation of increased quota
                    generally.--Except as provided in [subparagraph
                    (B) and subject to] subparagraph (D), if the
                    poundage quota apportioned to a State under
                    subsection (a)(3) for any [of the 1991 through
                    1997 marketing years] marketing year is
                    increased over the poundage quota apportioned
                    to farms in the State for the immediately
                    preceding marketing year, the increase shall be
                    allocated proportionately, based on farm
                    production history for peanuts for the 3
                    immediately preceding years, among--
                              (i) all farms in the State for each
                            of which a farm poundage quota was
                            established for the marketing year
                            immediately preceding the marketing
                            year for which the allocation is being
                            made; and
                              (ii) all other farms in the State on
                            each of which peanuts were produced in
                            at least 2 of the 3 immediately
                            preceding crop years, as determined by
                            the Secretary.
                      [(B) Allocation of increased quota in
                    texas.--
                              [(i) In general.--In Texas, and
                            subject to terms and conditions
                            prescribed by the Secretary, beginning
                            with the 1991 marketing year, 33
                            percent of the increased quota referred
                            to in subparagraph (A) shall be
                            allocated to farms having poundage
                            quotas for the 1990 marketing year in
                            any county in which the production of
                            additional peanuts exceeded the total
                            quota allocated to the county for the
                            1989 marketing year.
                              [(ii) Basis for allocation to
                            counties.--The allocation of the quota
                            to eligible counties shall be based on
                            the total production of additional
                            peanuts in the respective counties for
                            the 1988 crop, except that the total
                            quota allocated to any county under
                            this subparagraph and paragraph (6)(C)
                            shall not be increased by more than 100
                            percent of the basic quota assigned to
                            the county for the 1989 marketing year
                            if that county had more than 10,000
                            tons of quota for the 1989 marketing
                            year.
                              [(iii) Allocation to other
                            counties.--If the total quota for any
                            such county is so increased by 100
                            percent, all of the remaining quota
                            percentage set aside under this
                            subparagraph shall be allocated to
                            farms in other counties otherwise
                            meeting the requirements of this
                            subparagraph.
                              [(iv) Allocation to eligible farms.--
                            The percentage of increased quota in
                            any county shall be allocated under
                            this subparagraph only to quota farms
                            from which additional peanuts were
                            delivered under contract with handlers
                            for the marketing year immediately
                            preceding the marketing year for which
                            the allocation is being made. The
                            percentage of the increased quota in
                            each county shall be allocated among
                            the eligible farms in the county on the
                            following basis:
                                      [(I) Factor.--A factor shall
                                    be established for each such
                                    eligible farm by dividing the
                                    quantity of additional peanuts
                                    contracted and delivered to
                                    handlers from the farm by the
                                    total remaining peanuts
                                    produced on the farm for the
                                    marketing year immediately
                                    preceding the marketing year
                                    for which the allocation is
                                    being made.
                                      [(II) Allocation.--Each such
                                    eligible farm shall be
                                    allocated the percentage of the
                                    increased quota for the county
                                    as its factor bears to the
                                    total of the factors for all
                                    eligible farms in the county.
                              [(v) Remaining percentage.--In Texas,
                            the remaining 67 percent of the
                            increased quota referred to in
                            subparagraph (A) shall be allocated to
                            farms in the State in accordance with
                            subparagraph (A).]
                      (B) Temporary quota allocation.--
                              (i) Allocation related to seed
                            peanuts.--Temporary allocation of quota
                            pounds for the marketing year only in
                            which the crop is planted shall be made
                            to producers for each of the 1996
                            through 2002 marketing years as
                            provided in this subparagraph.
                              (ii) Quantity.--The temporary quota
                            allocation shall be equal to the pounds
                            of seed peanuts planted on the farm, as
                            may be adjusted under regulations
                            prescribed by the Secretary.
                              (iii) Additional quota.--The
                            temporary allocation of quota pounds
                            under this paragraph shall be in
                            addition to the farm poundage quota
                            otherwise established under this
                            subsection and shall be credited, for
                            the applicable marketing year only, in
                            total to the producer of the peanuts on
                            the farm in a manner prescribed by the
                            Secretary.
                              (iv) Effect of other requirements.--
                            Nothing in this section alters or
                            changes the requirements regarding the
                            use of quota and additional peanuts
                            established by section 358e(b).
                      (C) Decrease.--If the poundage quota
                    apportioned to a State under subsection (a)(3)
                    for any [of the 1991 through 1997 marketing
                    years] marketing year is decreased from the
                    poundage quota apportioned to farms in the
                    State under subsection (a)(3) for the
                    immediately preceding marketing year, the
                    decrease shall be allocated among all the farms
                    in the State for each of which a farm poundage
                    quota was established for the marketing year
                    immediately preceding the marketing year for
                    which the allocation is being made.
              * * * * * * *
                      (E) Transfer of quota from ineligible
                    farms.--Any farm poundage quota held at the end
                    of the 1996 marketing year by a farm described
                    in paragraph (1)(D) shall be allocated to other
                    farms in the same State on such basis as the
                    Secretary may by regulation prescribe.
              (3) Quota not produced.--
                      (A) In general.--Insofar as practicable and
                    on such fair and equitable basis as the
                    Secretary may by regulation prescribe, the farm
                    poundage quota established for a farm for any
                    [of the 1991 through 1997 marketing years]
                    marketing year shall be reduced to the extent
                    that the Secretary determines that the farm
                    poundage quota established for the farm for any
                    2 of the 3 marketing years preceding the
                    marketing year for which the determination is
                    being made was not produced, or considered
                    produced, on the farm.
                      (B) Exclusions.--For the purposes of this
                    paragraph, the farm poundage quota for any such
                    preceding marketing year shall not [include--
                              [(i) any increases for undermarketing
                            of quota peanuts from previous years;
                            or
                              [(ii) any increase resulting from the
                            allocation of quotas voluntarily
                            released for 1 year under paragraph
                            (7).] include any increase resulting
                            from the allocation of quotas
                            voluntarily released for 1 year under
                            paragraph (7).
              * * * * * * *
              [(8) Increase for undermarketings in previous
            marketing years.--
                      [(A) In general.--Except as provided in
                    subparagraph (B), the farm poundage quota for a
                    farm for any marketing year shall be increased
                    by the number of pounds by which the total
                    marketings of quota peanuts from the farm
                    during previous marketing years (excluding any
                    marketing year before the marketing year for
                    the 1989 crop) were less than the total amount
                    of applicable farm poundage quotas
                    (disregarding adjustments for undermarketings
                    from previous marketing years) for the
                    marketing years.
                      [(B) Quota not produced.--For purposes of
                    subparagraph (A), no increase for
                    undermarketings in previous marketing years
                    shall be made to the poundage quota for any
                    farm to the extent that the poundage quota for
                    the farm for the marketing year was reduced
                    under paragraph (3) for failure to produce.
                      [(C) National poundage quota.--Any increases
                    in farm poundage quotas under this paragraph
                    shall not be counted against the national
                    poundage quota for the marketing year involved.
                      [(D) Transfer of additional peanuts.--Any
                    increase in the farm poundage quota for a farm
                    for a marketing year under this paragraph may
                    be used during the marketing year by the
                    transfer of additional peanuts produced on the
                    farm to the quota loan pool for pricing
                    purposes on such basis as the Secretary shall
                    by regulation prescribe.
              [(9) Limit on increases for undermarketings.--
            Notwithstanding the foregoing provisions of this
            subsection, if the total of all increases in individual
            farm poundage quotas under paragraph (8) exceeds 10
            percent of the national poundage quota for the
            marketing year in which the increases shall be
            applicable, the Secretary shall adjust the increases so
            that the total of all the increases does not exceed 10
            percent of the national poundage quota.]
              (8) Disaster transfers.--
                      (A) In general.--Except as provided in
                    subparagraph (B), additional peanuts produced
                    on a farm from which the quota poundage was not
                    harvested and marketed because of drought,
                    flood, or any other natural disaster, or any
                    other condition beyond the control of the
                    producer, may be transferred to the quota loan
                    pool for pricing purposes on such basis as the
                    Secretary shall by regulation provide.
                      (B) Limitation.--The poundage of peanuts
                    transferred under subparagraph (A) shall not
                    exceed the difference between--
                              (i) the total quantity of peanuts
                            meeting quality requirements for
                            domestic edible use, as determined by
                            the Secretary, marketed from the farm;
                            and
                              (ii) the total farm poundage quota,
                            excluding quota pounds transferred to
                            the farm in the fall.
                      (C) Support rate.--Peanuts transferred under
                    this paragraph shall be supported at 70 percent
                    of the quota support rate for the marketing
                    years in which the transfers occur. The
                    transfers for a farm shall not exceed 25
                    percent of the total farm quota pounds,
                    excluding pounds transferred in the fall.
              * * * * * * *
      (e) Definitions.--For the purposes of this part and title I
    of the Agricultural Act of 1949 (7 U.S.C. 1441 et seq.):
              (1) * * *
              * * * * * * *
              (3) Domestic edible use.--The term ``domestic edible
            use'' means use for milling to produce domestic food
            peanuts (other than those described in paragraph (2))
            [and seed and use on a farm], except that the Secretary
            may exempt from this definition seeds of peanuts that
            are used to produce peanuts excluded under section
            358d(c), are unique strains, and are not commercially
            available.
              * * * * * * *
      (f) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through [1997]
    2002 crops of peanuts.

             [SALE, LEASE AND TRANSFER OF PEANUT ACREAGE ALLOTMENTS

      [Sec. 358a. (a) Notwithstanding any other provision of law
    for the 1968 and succeeding crop years, the Secretary, if he
    determines that it will not impair the effective operation of
    the peanut marketing quota or price support program, (1) may
    permit the owner and operator of any farm for which a peanut
    acreage allotment is established under this Act to sell or
    lease all or any part or the right to all or any part of such
    allotment to any other owner or operator of a farm in the same
    county for transfer to such farm; and (2) may permit the owner
    of a farm to transfer all or any part of such allotment to any
    other farm owned or controlled by him.
      [(b) Transfers under this section shall be subject to the
    following conditions: (1) no allotment shall be transferred to
    a farm in another county; (2) no transfer of an allotment from
    a farm subject to a mortgage or other lien shall be permitted
    unless the transfer is agreed to by the lienholders; (3) no
    sale of a farm allotment from a farm shall be permitted if any
    sale of allotment to the same farm has been made within the
    three immediately preceding crop years; (4) no transfer of
    allotment shall be effective until a record thereof is filed
    with the county committee of the county in which such transfer
    is made and such committee determines that the transfer
    complies with the provisions of this section; and (5) if the
    normal yield established by the county committee for the farm
    to which the allotment is transferred does not exceed the
    normal yield established by the county committee for the farm
    from which the allotment is transferred by more than 10 per
    centum, the lease or sale and transfer shall be approved acre
    for acre, but if the normal yield for the farm to which the
    allotment is transferred exceeds the normal yield for the farm
    from which the allotment is transferred by more than 10 per
    centum, the county committee shall make a downward adjustment
    in the amount of the acreage allotment transferred by
    multiplying the normal yield established for the farm from
    which the allotment is transferred by the acreage being
    transferred and dividing the result by the normal yield
    established for the farm to which the allotment is transferred:
    Provided, That in the event an allotment is transferred to a
    farm which at the time of such transfer is not irrigated, but
    within five years subsequent to such transfer is placed under
    irrigation, the Secretary shall also make an annual downward
    adjustment in the allotment so transferred by multiplying the
    normal yield established for the farm from which the allotment
    is transferred by the acreage being transferred and dividing
    the result by the actual yield for the previous year, adjusted
    for abnormal weather conditions, on the farm to which the
    allotment is transferred: Provided further, That,
    notwithstanding any other provision of this Act, the adjustment
    made in any peanut allotment because of the transfer to a
    higher producing farm shall not reduce or increase the size of
    any future National or State allotment and an acreage equal to
    the total of all such adjustment shall not be allotted to any
    other farms.
      [(c) The transfer of an allotment shall have the effect of
    transferring also the acreage history and marketing quota
    attributable to such allotment and if the transfer is made
    prior to the determination of the allotment for any year the
    transfer shall include the right of the owner or operator to
    have an allotment determined for the farm for such year:
    Provided, That in the case of a transfer by lease the amount of
    the allotment shall be considered, for the purpose of
    determining allotments after the expiration of the lease, to
    have been planted on the farm from which such allotment is
    transferred.
      [(d) The land in the farm from which the entire peanut
    allotment has been transferred shall not be eligible for a new
    farm peanut allotment during the five years following the year
    in which such transfer is made.
      [(e) Any lease may be made for such term of years not to
    exceed five as the parties thereto agree, and on such other
    terms and conditions except as otherwise provided in this
    section as the parties thereto agree.
      [(f) The lease of any part of a peanut acreage allotment
    determined for a farm shall not affect the allotment for the
    farm from which such allotment is transferred or the farm to
    which it is transferred, except with respect to the crop year
    or years specified in the lease. The amount of the acreage
    allotment which is leased from a farm shall be considered for
    purposes of determining future allotments to have been planted
    to peanuts on the farm from which such allotment is leased and
    the production pursuant to the lease shall not be taken into
    account in establishing allotments for subsequent years for the
    farm to which such allotment is leased. The lessor shall be
    considered to have been engaged in the production of peanuts
    for purposes of eligibility to vote in the referendum.
      [(g) The Secretary shall prescribe regulations for the
    administration of this section which may include reasonable
    limitation on the size of the resulting allotments on farms to
    which transfers are made and such other terms and conditions as
    he deems necessary, but the total peanut allotment transferred
    to any farm by sale or lease shall not exceed fifty acres.
      [(h) If the sale or transfer occur during a period in which
    the farm is covered by a conservation reserve contract,
    cropland conversion agreement, or other similar land
    utilization agreement the rates of payment provided for in the
    contract or agreement of the farm from which the transfer is
    made shall be subject to an appropriate adjustment, but no
    adjustment shall be made in the contract or agreement of the
    farm to which the transfer is made.]

    SEC. 358b. SALE, LEASE, OR TRANSFER OF FARM POUNDAGE QUOTA FOR [1991
                        THROUGH 1995 CROPS OF] PEANUTS.

      (a) In General.--
              (1) Authority.--Subject to such terms[, conditions,
            or limitations] and conditions as the Secretary may
            prescribe, the owner, or operator with the permission
            of the owner, of any farm for which a farm poundage
            quota has been established under this Act may sell or
            lease all or any part of the poundage quota [(including
            any applicable under marketings)] to any other owner or
            operator of a farm within the same county for transfer
            to the farm, except that [any such lease] any such sale
            or lease of poundage quota [(including any applicable
            under marketings)] may be entered into [in the fall or
            after the normal planting season--
                      [(A) if not less than 90 percent of the basic
                    quota (the farm quota exclusive of
                    undermarketings and temporary quota transfers),
                    plus any poundage quota transferred to the farm
                    under this subsection, has been planted or
                    considered planted on the farm from which the
                    quota is to be leased; and
                      [(B) under such terms and conditions as the
                    Secretary may by regulation prescribe.] in the
                    spring (or before the normal planting season)
                    or in the fall (or after the normal planting
                    season) with the owner or operator of a farm
                    located within any county in the same State. In
                    the case of a fall transfer or a transfer after
                    the normal planting season, the transfer may be
                    made only if not less than 90 percent of the
                    basic quota (the farm quota exclusive of
                    temporary quota transfers), plus any poundage
                    quota transferred to the farm under this
                    subsection, has been planted or considered
                    planted on the farm from which the quota is to
                    be leased.
            In the case of a fall transfer or a transfer after the
            normal planting season by a cash lessee, the landowner
            shall not be required to sign the transfer
            authorization. A fall transfer or a transfer after the
            normal planting season may be made not later than 72
            hours after the peanuts that are the subject of the
            transfer are inspected and graded.
              (2) Transfers to other self-owned farms.--The owner
            or operator of a farm may transfer all or any part of
            the farm poundage quota [(including any applicable
            under marketings)] to any other farm owned or
            controlled by the owner or operator that is in the same
            county or in a county contiguous to the county in the
            same State and that had a farm poundage quota for the
            preceding year's crop. Any farm poundage quota
            transferred under this paragraph shall not result in
            any reduction in the farm poundage quota for the
            transferring farm if the transferred quota is produced
            or considered produced on the receiving farm.
              (3) Transfers in states with small quotas.--
            Notwithstanding paragraphs (1) and (2), in the case of
            any State for which the poundage quota allocated to the
            State was less than 10,000 tons for the preceding
            year's crop, all or any part of a farm poundage quota
            [(including any applicable undermarketings)] may be
            transferred by sale or lease or otherwise from a farm
            in one county to a farm in another county in the same
            State.
      (c) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through [1995]
    2002 crops of peanuts.

    SEC. 358c. EXPERIMENTAL AND RESEARCH PROGRAMS FOR PEANUTS.

      (a) * * *
              * * * * * * *
      (d) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through [1995]
    2002 crops of peanuts.

                              [MARKETING PENALTIES

      [Sec. 358d. (a) The marketing of any peanuts in excess of the
    marketing quota for the farm on which such peanuts are
    produced, or the marketing of peanuts from any farm for which
    no acreage allotment was determined, shall be subject to a
    penalty at a rate equal to 75 per centum of the price support
    for peanuts for the marketing year (August 1-July 31). Such
    penalty shall be paid by the person who buys or otherwise
    acquires the peanuts from the producer, or if the peanuts are
    marketed by the producer through an agent, the penalty shall be
    paid by such agent, and such person or agent may deduct an
    amount equivalent to the penalty from the price paid to the
    producer. The Secretary may require collection of the penalty
    upon a portion of each lot of peanuts marketed from the farm
    equal to the proportion which the acreage of peanuts in excess
    of the farm-acreage allotment is of the total acreage of
    peanuts on the farm. If the person required to collect the
    penalty fails to collect such penalty, such person and all
    persons entitled to share in the peanuts marketed from the farm
    or the proceeds thereof shall be jointly and severally liable
    for the amount of the penalty. All funds collected pursuant to
    this section shall be deposited in a special deposit account
    with the Treasurer of the United States and such amounts as are
    determined, in accordance with regulations prescribed by the
    Secretary, to be penalties incurred shall be transferred to the
    general fund of the Treasury of the United States. Amounts
    collected in excess of determined penalties shall be paid to
    such producers as the Secretary determines, in accordance with
    regulations prescribed by him, bore the burden of the payment
    of the amount collected. Such special account shall be
    administered by the Secretary and the basis for, the amount of
    and the producer entitled to receive a payment from such
    account, when determined in accordance with regulations
    prescribed by the Secretary, shall be final and conclusive.
    Peanuts produced in a calendar year in which marketing quotas
    are in effect for the marketing year beginning therein shall be
    subject to such quotas even though the peanuts are marketed
    prior to the date on which such marketing year begins. If any
    producer falsely identifies or fails to account for the
    disposition of any peanuts, an amount of peanuts equal to the
    normal yield of the number of acres harvested in excess of the
    farm acreage allotment shall be deemed to have been marketed in
    excess of the marketing quota for the farm, and the penalty in
    respect thereof shall be paid and remitted by the producer. If
    any amount of peanuts produced on one farm is falsely
    identified by a representation that such peanuts were produced
    on another farm, the acreage allotments next established for
    both such farms shall be reduced by that percentage which such
    amount was of the respective farm marketing quotas, except that
    such reduction for any such farm shall not be made if the
    Secretary through the local committees finds that no person
    connected with such farm caused, aided, or acquiesced in such
    marketing; and if proof of the disposition of any amount of
    peanuts is not furnished as required by the Secretary, the
    acreage allotment next established for the farm on which such
    peanuts are produced shall be reduced by a percentage similarly
    computed. Notwithstanding any other provisions of this title,
    no refund of any penalty shall be made because of peanuts kept
    on the farm for seed or for home consumption.
      [(b) The provisions of this part shall not apply, beginning
    with the 1959 crop, to peanuts produced on any farm on which
    the acreage harvested for nuts is one acre or less provided the
    producers who share in the peanuts produced on such farm do not
    share in the peanuts produced on any other farm. If the
    producers who share in the peanuts produced on a farm on which
    the acreage harvested for nuts is one acre or less also share
    in the peanuts produced on other farm(s) the peanuts produced
    on such farm on acreage in excess of the allotment, if any,
    determined for the farm shall be considered as excess acreage
    and the marketing penalties provided by subsection (a) shall
    apply.
      [(c) The word ``peanuts'' for the purposes of this Act shall
    mean all peanuts produced, excluding any peanuts which it is
    established by the producer or otherwise, in accordance with
    regulations of the Secretary, were not picked or threshed
    either before or after marketing from the farm, or were
    marketed by the producer before drying or removal of moisture
    from such peanuts either by natural or artificial means for
    consumption exclusively as boiled peanuts.
      [(d) The person liable for payment or collection of the
    penalty provided by this section shall be liable also for
    interest thereon at the rate of 6 per centum per annum from the
    date the penalty becomes due until the date of payment of such
    penalty.
      [(e) Until the amount of the penalty provided by this section
    is paid, a lien on the crop of peanuts with respect to which
    such penalty is incurred, and on any subsequent crop of peanuts
    subject to marketing quotas in which the person liable for
    payment of the penalty has an interest shall be in effect in
    favor of the United States.]

    SEC. 358e. MARKETING PENALTIES AND DISPOSITION OF ADDITIONAL PEANUTS
                        [FOR 1991 THROUGH 1997 CROPS OF PEANUTS].

      (a) * * *
              * * * * * * *
      (i) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through [1997]
    2002 crops of peanuts.

          [PART VII--MARKETING QUOTAS--SUGAR AND CRYSTALLINE FRUCTOSE

    [SEC. 359a. INFORMATION REPORTING.

      [(a) Duty of Processors, Refiners and Manufacturers To
    Report.--
              [(1) Processors and refiners.--All sugarcane
            processors, cane sugar refiners, and sugar beet
            processors 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) Manufacturers of crystalline fructose.--All
            manufacturers of crystalline fructose from corn
            (hereafter in this part referred to as ``crystalline
            fructose'') shall furnish the Secretary, on a monthly
            basis, such information as the Secretary may require
            with respect to the manufacturer's distribution of
            crystalline fructose.
      [(b) Duty of Producers To Report.--The Secretary may require
    a producer of sugarcane or sugar beets to report, in the manner
    prescribed by the Secretary, the producer's sugarcane or sugar
    beet yields and acres planted to sugarcane or sugar beets,
    respectively.
      [(c) 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.
      [(d) Monthly Reports.--Taking into consideration the
    information received under subsection (a), the Secretary shall
    publish on a monthly basis composite data on production,
    imports, distribution, and stock levels of sugar and composite
    data on distributions of crystalline fructose.

    [SEC. 359b. MARKETING ALLOTMENTS FOR SUGAR AND CRYSTALLINE FRUCTOSE.

      [(a) Sugar Estimates.--
              [(1) In general.--Before the beginning of each of the
            fiscal years 1992 through 1998, the Secretary shall
            estimate--
                      [(A) the quantity of sugar that will be
                    consumed in the United States during the fiscal
                    year (other than sugar imported for the
                    production of polyhydric alcohol or to be
                    refined and reexported in refined form or in
                    sugar containing products) and the quantity of
                    sugar that would provide for reasonable
                    carryover stocks;
                      [(B) the quantity of sugar that will be
                    available from carry-in stocks or from
                    domestically-produced sugarcane and sugar beets
                    for consumption in the United States during the
                    year; and
                      [(C) the quantity of sugar that will be
                    imported for consumption in the United States
                    during the year (other than sugar imported for
                    the production of polyhydric alcohol or to be
                    refined and reexported in a refined form or in
                    sugar containing products), based on the
                    difference between--
                              [(i) the sum of the quantity of
                            estimated consumption and reasonable
                            carryover stocks; and
                              [(ii) the quantity of sugar estimated
                            to be available from domestically-
                            produced sugarcane and sugar beets and
                            from carry-in stocks.
              [(2) Quarterly reestimates.--The Secretary shall make
            quarterly reestimates of sugar consumption, stocks,
            production, and imports for a fiscal year no later than
            the beginning of each of the second through fourth
            quarters of the fiscal year.
      [(b) Sugar Allotments.--
              [(1) In general.--For any fiscal year in which the
            Secretary estimates, under subsection (a)(1)(C), that
            imports of sugar for consumption in the United States
            (other than sugar imported for the production of
            polyhydric alcohol or to be refined and reexported in
            refined form or in sugar containing products) will be
            less than 1,250,000 short tons, raw value, the
            Secretary shall establish for that year appropriate
            allotments under section 359c for the marketing by
            processors of sugar processed from domestically-
            produced sugarcane and sugar beets, at a level that the
            Secretary estimates will result in imports of sugar of
            not less than 1,250,000 short tons, raw value, for that
            year.
              [(2) Products.--The Secretary may include sugar
            products, whose majority content is sucrose or
            crystalline fructose 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) Crystalline Fructose Allotments.--For any fiscal year in
    which the Secretary establishes allotments for the marketing of
    sugar under section 359c, the Secretary shall establish for
    that year appropriate allotments for the marketing by
    manufacturers of crystalline fructose manufactured from corn,
    at a total level not to exceed the equivalent of 200,000 tons
    of sugar, raw value, during the fiscal year, in a manner that
    is fair, efficient, and equitable to manufacturers.
      [(d) Prohibitions.--
              [(1) In general.--During any fiscal 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) Crystalline fructose.--At any time crystalline
            fructose allotments are in effect for manufacturers
            under subsection (c), no manufacturer may market
            crystalline fructose in excess of the manufacturer's
            allotment. No restrictions or allotments shall be
            established on the marketings of any liquid fructose
            produced from corn.
              [(3) Civil penalty.--Any processor who knowingly
            violates paragraph (1) or manufacturer who knowingly
            violates paragraph (2) 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 or crystalline fructose involved in
            the violation.
              [(4) 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, with respect to any integrated processor
            and refiner, the movement of raw cane sugar into the
            refining process).

    [SEC. 359c. ESTABLISHMENT OF MARKETING ALLOTMENTS.

      [(a) In General.--The Secretary shall establish marketing
    allotments for sugar for any fiscal 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 fiscal
            year (hereafter 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 fiscal year) for
            the fiscal year, as determined under section 359b(a)--
                      [(A) 1,250,000 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 the maximum extent
            practicable to avoid the forfeiture of sugar to the
            Commodity Credit Corporation.
      [(c) Allotment.--The overall allotment quantity for the
    fiscal year shall be allotted among--
              [(1) sugar derived from sugar beets; and
              [(2) sugar derived from sugarcane.
      [(d) Percentage Factors.--
              [(1) In general.--The Secretary shall establish
            percentage factors for the overall beet sugar and cane
            sugar allotments applicable for a fiscal year. The
            Secretary shall establish the percentage factors in a
            fair and equitable manner on the basis of past
            marketings of sugar (considering for such purposes the
            marketings of sugar processed from sugarcane and sugar
            beets of any or all of the 1985 through 1989 crops),
            processing and refining capacity, and the ability of
            processors to market the sugar covered under the
            allotments.
              [(2) Publication.--The Secretary shall publish these
            percentage factors in the Federal Register, along with
            a description of the Secretary's reasons for
            establishing the factors, as provided in section
            359h(c).
      [(e) Marketing Allotment.--The marketing allotment for sugar
    derived from sugarcane and the marketing allotment for sugar
    derived from sugar beets for a fiscal year, in each case, shall
    be a quantity equal to the product of multiplying the overall
    allotment quantity for the fiscal year by the percentage factor
    established by the Secretary under subsection (d)(1) for the
    allotment.
      [(f) State Cane Sugar Allotments.--The allotment for sugar
    derived from sugarcane shall be further allotted, among the 5
    States in the United States in which sugarcane is produced, in
    a fair and equitable manner on the basis of past marketings of
    sugar (considering for such purposes the average of marketings
    of sugar processed from sugarcane in the 2 highest years of
    production from each State from the 1985 through 1989 crops),
    processing capacity, and the ability of processors to market
    the sugar covered under the allotments.
      [(g) Adjustment of Marketing Allotments.--
              [(1) In general.--The Secretary shall, based on
            reestimates under section 359b(a)(2)--
                      [(A) adjust upward or downward marketing
                    allotments established under subsections (a)
                    through (f) in a fair and equitable manner;
                      [(B) establish marketing allotments for the
                    fiscal year or any portion of such fiscal year;
                    or
                      [(C) suspend the allotments,
            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(b), shall be increased
            or decreased by the same percentage that the allotment
            is increased or decreased.
              [(3) Reductions.--Whenever a marketing allotment for
            a fiscal year is required to be reduced during the
            fiscal year under this subsection, if the quantity of
            sugar marketed, including sugar pledged as collateral
            for a price support loan under section 206 of the
            Agricultural Act of 1949 (7 U.S.C. 1446g), for the
            fiscal year at the time of the reduction by any
            individual processor covered by the allotment exceeds
            the processor's reduced allocation, the allocation of
            an allotment, if any, next established for the
            processor shall be reduced by the quantity of the
            excess sugar marketed.
      [(h) Filling Cane Sugar and Beet Sugar Allotments.--Each
    marketing allotment for cane sugar established under this
    section may only be filled with sugar processed from
    domestically grown sugarcane, and each marketing allotment for
    beet sugar established under this section may only be filled
    with sugar processed from domestically grown sugar beets.

    [SEC. 359d. ALLOCATION OF MARKETING ALLOTMENTS.

      [(a) In General.--
              [(1) Allocation to processors.--Whenever marketing
            allotments are established for a fiscal 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.
              [(2) Hearing and notice.--
                      [(A) Cane sugar.--The Secretary shall make
                    allocations for cane sugar after a hearing, if
                    requested by interested parties, 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 by
                    taking into consideration processing capacity,
                    past marketings of sugar, and the ability of
                    each processor to market sugar covered by that
                    portion of the allotment allocated. Each such
                    allocation shall be subject to adjustment under
                    section 359c(g).
                      [(B) Beet sugar.--The Secretary shall make
                    allocations for beet sugar after a hearing, if
                    requested by interested parties, 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 by
                    taking into consideration processing capacity,
                    past marketings of sugar (considering for the
                    purposes the marketings of sugar processed from
                    sugar beets of any or all of the 1985 through
                    1989 crops), and the ability of each processor
                    to market sugar covered by that portion of the
                    allotment allocated. Each such allocation shall
                    be subject to adjustment under section 359c(g).
      [(b) Filling Cane Sugar Allotments.--Except as otherwise
    provided in section 359e, a State cane sugar allotment
    established under section 359c(f) for a fiscal year may be
    filled only with sugar processed from sugarcane grown in the
    State covered by the allotment.

    [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 fiscal 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; and
                      [(C) if after the reassignments, 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; and
                      [(B) if after the reassignments, 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 fiscal year shall
            be increased to reflect the reassignment.

    [SEC. 359f. PROVISIONS APPLICABLE TO PRODUCERS.

      [(a) Processor Assurances.--Whenever allotments for a fiscal
    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. Any dispute between a processor and a producer, or
    group of producers, with respect to the sharing of the
    processor's allocation shall be resolved through arbitration by
    the Secretary on the request of either party.
      [(b) 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 fiscal year will be
            in excess of the quantity needed to enable processors
            to fill the allotment for the fiscal 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 fiscal 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 preceding 5
                    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 fiscal 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 each of the 5 crop years preceding the
                    fiscal year the proportionate share will be in
                    effect.
                      [(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 fiscal 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
                    fiscal 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 the allocation of such
                    processor for the fiscal 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.

    [SEC. 359g. SPECIAL RULES.

      [(a) Transfer of Acreage Base History.--For the purpose of
    establishing proportionate shares for sugarcane farms under
    section 359f, 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, 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 3 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 for a farm under section 359f, on the same basis as
    the initial allocation or proportionate share was required to
    be established.

    [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.

    [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 sections 359a
    through 359i.
      [(c) Definition of United States and State.--Notwithstanding
    section 301, for purposes of this part, the terms ``United
    States'' and ``State'' means the 50 States, the District of
    Columbia, and the Commonwealth of Puerto Rico.]

                     Subtitle C--Administrative Provisions

                    PART I--PUBLICATION AND REVIEW OF QUOTAS

                              APPLICATION OF PART

      Sec. 361. This part shall apply to the publication and review
    of farm marketing quotas established for tobacco[, corn, wheat,
    cotton, peanuts, and rice, established] under subtitle B.

                 PART II--ADJUSTMENT OF QUOTAS AND ENFORCEMENT

                         GENERAL ADJUSTMENTS OF QUOTAS

      Sec. 371. (a) If at any time the Secretary has reason to
    believe that in the case of [cotton, rice, peanuts, or] tobacco
    the operation of farm marketing quotas in effect will cause the
    amount of such commodity which is free of marketing
    restrictions to be less than the normal supply for the
    marketing year for the commodity then current, he shall cause
    an immediate investigation to be made with respect thereto. In
    the course of such investigation due notice and opportunity for
    hearing shall be given to interested persons. If upon the basis
    of such investigation the Secretary finds the existence of such
    fact, he shall proclaim the same forthwith. He shall also in
    such proclamation specify such increase in, or termination of,
    existing quotas as he finds, on the basis of such
    investigation, is necessary to make the amount of such
    commodity which is free of marketing restrictions equal to the
    normal supply.
      (b) If the Secretary has reason to believe that, because of a
    national emergency or because of a material increase in export
    demand, any national marketing quota or acreage allotment for
    [cotton, rice, peanuts or] tobacco should be increased or
    terminated, he shall cause an immediate investigation to be
    made to determine whether the increase or termination is
    necessary to meet such emergency or increase in export demand.
    If, on the basis of such investigation, the Secretary finds
    that such increase or termination is necessary, he shall
    immediately proclaim such finding (and if he finds an increase
    is necessary, the amount of the increase found by him to be
    necessary) and thereupon such quota or allotment shall be
    increased, or shall terminate, as the case may be.

                    [Subtitle D--Wheat Marketing Allocation

                             [LEGISLATIVE FINDINGS

      [Sec. 379a. Wheat, in addition to being a basic food, is one
    of the great export crops of American agriculture and its
    production for domestic consumption and for export is necessary
    to the maintenance of a sound national economy and to the
    general welfare. The movement of wheat from producer to
    consumer, in the form of the commodity or any of the products
    thereof, is preponderantly in interstate and foreign commerce.
    Unreasonably low prices of wheat to producers impair their
    purchasing power for nonagricultural products and place them in
    a position of serious disparity with other industrial groups.
    The conditions affecting the production of wheat are such that
    without Federal assistance, producers cannot effectively
    prevent disastrously low prices for wheat. It is necessary, in
    order to assist wheat producers in obtaining fair prices, to
    regulate the price of wheat used for domestic food and for
    exports in the manner provided in this subtitle.

                          [WHEAT MARKETING ALLOCATION

      [Sec. 379b. During any marketing year for which a marketing
    quota is in effect for wheat, beginning with the marketing year
    for the 1964 crop, a wheat marketing allocation program shall
    be in effect as provided in this subtitle. Whenever a wheat
    marketing allocation program is in effect for any marketing
    year the Secretary shall determine (1) the wheat marketing
    allocation for such year which shall be the amount of wheat
    which in determining the national marketing quota for such
    marketing year he estimated would be used during such year for
    food products for consumption in the United States, and that
    portion of the amount of wheat which in determining such quota
    he estimated would be exported in the form of wheat or products
    thereof during the marketing year on which the Secretary
    determines that marketing certificates shall be issued to
    producers in order to achieve, insofar as practicable, the
    price and income objectives of this subtitle, and (2) the
    national allocation percentage which shall be the percentage
    which the national marketing allocation is of the national
    marketing quota. Each farm shall receive a wheat marketing
    allocation for such marketing year equal to the number of
    bushels obtained by multiplying the number of acres in the farm
    acreage allotment for wheat by the projected farm yield, and
    multiplying the resulting number of bushels by the national
    allocation percentage. If a noncommercial wheat-production area
    is established for any marketing year, farms in such area shall
    be given wheat marketing allocations which are determined by
    the Secretary to be fair and reasonable in relation to the
    wheat marketing allocation given producers in the commercial
    wheat-producing area.

                            [MARKETING CERTIFICATES

      [Sec. 379c. (a) The Secretary shall provide for the issuance
    of wheat marketing certificates for each marketing year for
    which a wheat marketing allocation program is in effect for the
    purpose of enabling producers on any farm with respect to which
    certificates are issued to receive, in addition to the other
    proceeds from the sale of wheat, an amount equal to the value
    of such certificates. The wheat marketing certificates issued
    with respect to any farm for any marketing year shall be in the
    amount of the farm wheat marketing allocation for such year,
    but not to exceed (i) the actual acreage of wheat planted on
    the farm for harvest in the calendar year in which the
    marketing year begins multiplied by the normal yield of wheat
    for the farm, plus (ii) the amount of wheat stored under
    section 379c(b) or to avoid or postpone a marketing quota
    penalty, which is released from storage during the marketing
    year on account of underplanting or underproduction, and if
    this limitation operates to reduce the amount of wheat
    marketing certificates which would otherwise be issued with
    respect to the farm, such reduction shall be made first from
    the amount of export certificates which would otherwise be
    issued. The Secretary shall provide for the sharing of wheat
    marketing certificates among producers on the farm on the basis
    of their respective shares in the wheat crop produced on the
    farm, or the proceeds therefrom; except that in any case in
    which the Secretary determines that such basis would not be
    fair and equitable, the Secretary shall provide for such
    sharing on such other basis as he may determine to be fair and
    equitable. The Secretary shall, in accordance with such
    regulation as he may prescribe, provide for the issuance of
    domestic marketing certificates for the portion of the wheat
    marketing allocation representing wheat used for food products
    for consumption in the United States. The Secretary shall also
    provide for the issuance of export marketing certificates to
    eligible producers at the end of the marketing year on a pro
    rata basis. For such purposes, the value per bushel of export
    marketing certificates shall be an average of the total net
    proceeds from the sale of export marketing certificates during
    the marketing year after deducting the total amount of wheat
    export subsidies paid to exporters. An acreage on the farm
    which the Secretary finds was not planted to wheat for harvest
    in 1965 because of drought, flood, or other natural disaster
    shall be deemed by the Secretary to be an actual acreage of
    wheat planted for harvest for purposes of this subsection,
    provided such acreage is not subsequently planted to any other
    price supported crop for 1965. An acreage on the farm not
    planted to wheat because of drought, flood, or other natural
    disaster shall be deemed to be an actual acreage of wheat
    planted for harvest for purposes of this subsection provided
    such acreage is not subsequently planted to any crop for which
    there are marketing quotas or voluntary adjustment programs in
    effect. Producers on any farm who have planted not less than 90
    per centum of the acreage of wheat required to be planted in
    order to earn the full amount of marketing certificates for
    which the farm is eligible shall be deemed to have planted the
    entire acreage required to be planted for that purpose.
      [(b) No producer shall be eligible to receive wheat marketing
    certificates with respect to any farm for any marketing year in
    which a marketing quota penalty is assessed for any commodity
    on such farm or in which the farm has not complied with the
    land-use requirements of section 339 to the extent prescribed
    by the Secretary, or in which, except as the Secretary may by
    regulation prescribe, the producer exceeds the farm acreage
    allotment on any other farm for any commodity in which he has
    an interest as a producer. No producer shall be deemed to have
    exceeded a farm acreage allotment for wheat if the entire
    amount of the farm marketing excess is delivered to the
    Secretary or stored in accordance with applicable regulations
    to avoid or postpone payment of the penalty. No producer shall
    be deemed to have exceeded the farm acreage allotment for wheat
    on any other farm if such farm is exempt from the farm market
    quota for such crop under section 335. Any wheat delivered to
    the Secretary hereunder shall become the property of the United
    States and shall be disposed of by the Secretary for relief
    purposes in the United States or in foreign countries or in
    such other manner as he shall determine will divert it from the
    normal channels of trade and commerce. Notwithstanding any
    other provision of this Act, the Secretary may provide that a
    producer shall not be eligible to receive marketing
    certificates, or may adjust the amount of marketing
    certificates to be received by the producer, with respect to
    any farm for any year in which a variety of wheat is planted on
    the farm which has been determined by the Secretary, after
    consultation with State Agricultural Experiment Stations,
    agronomists, cereal chemists and other qualified technicians,
    to have undesirable milling or baking qualities and has made
    public announcement thereof.
      [(c) The Secretary shall determine and proclaim for each
    marketing year the face value per bushel of wheat marketing
    certificates. The face value per bushel of domestic
    certificates shall be the amount by which the level of price
    support for wheat accompanied by domestic certificates exceeds
    the level of price support for wheat not accompanied by
    certificates (noncertificate wheat).
      [(d) Marketing certificates and transfers thereof shall be
    represented by such documents, marketing cards, records,
    accounts, certifications, or other statements or forms as the
    Secretary may prescribe.
      [(e) In any case in which the failure of a producer to comply
    fully with the term and conditions of the programs formulated
    under this Act preclude the issuance of marketing certificates,
    the Secretary may, nevertheless, issue such certificates in
    such amounts as he determines to be equitable in relation to
    the seriousness of the default.

                            [MARKETING RESTRICTIONS

      [Sec. 379d. (a) Marketing certificates shall be transferable
    only in accordance with regulations prescribed by the
    Secretary. Any unused certificates legally held by any person
    shall be purchased by Commodity Credit Corporation if tendered
    to the Corporation for purchase in accordance with regulations
    prescribed by the Secretary.
      [(b) During any marketing year for which a wheat marketing
    allocation program is in effect, (i) all persons engaged in the
    processing of wheat into food products shall, prior to
    marketing any such food product or removing such food product
    for sale or consumption, acquire domestic marketing
    certificates equivalent to the number of bushels of wheat
    contained in such product and (ii) all persons exporting wheat
    shall, prior to such export, acquire export market certificates
    equivalent to the number of bushels so exported. The cost of
    the export marketing certificates per bushel to the exporter
    shall be that amount determined by the Secretary on a daily
    basis which would make United States wheat and wheat flour
    generally competitive in the world market, avoid disruption of
    world market prices, and fulfill the international obligations
    of the United States. The Secretary may exempt from the
    requirements of this subsection wheat exported for donation
    abroad and other noncommercial exports of wheat, wheat
    processed for use on the farm where grown, wheat produced by a
    State or agency thereof and processed for use by the State or
    agency thereof wheat processed for donation, and wheat
    processed for uses determined by the Secretary to be
    noncommercial. Such exemptions may be made applicable with
    respect to any wheat processed or exported beginning July 1,
    1964. There shall be exempt from the requirements of this
    subsection beverage distilled from wheat prior to July 1, 1964.
    A beverage distilled from wheat after July 1, 1964, shall be
    deemed to be removed for sale or consumption at the time it is
    placed in barrels for aging except that upon the giving of a
    bond as prescribed by the Secretary, the purchase of and
    payment for such marketing certificates as may be required may
    be deferred until such beverage is bottled for sale. Wheat
    shipped to a Canadian port for storage in bond, or storage
    under a similar arrangement, and subsequent exportation shall
    be deemed to have been exported for purposes of this subsection
    when it is exported from the Canadian port. Marketing
    certificates shall be valid to cover only sales or removals for
    sale or consumption or exportations made during the marketing
    year with respect to which they are issued, and after being
    once used to cover a sale or removal for sale or consumption or
    export of a food product or an export of wheat shall be void
    and shall be disposed of in accordance with regulations
    prescribed by the Secretary. Notwithstanding the foregoing
    provisions hereof the Secretary may require marketing
    certificates issued for any marketing year to be acquired to
    cover sales, removals or exportations made on or after the date
    during the calendar year in which wheat harvested in such
    calendar year begins to be marketed as determined by the
    Secretary even though such wheat is marketed prior to the
    beginning of the marketing year, and marketing certificates for
    such marketing year shall be valid to cover sales, removals, or
    exportations made on or after the date so determined by the
    Secretary. Whenever the face value per bushel of domestic
    marketing certificates for a marketing year is different from
    the face value of domestic marketing certificates for the
    preceding marketing year, the Secretary may require marketing
    certificates issued for the preceding marketing year to be
    acquired to cover all wheat processed into food products during
    such preceding marketing year even though the food product may
    be marketed or removed for sale or consumption after the end of
    the marketing year. Notwithstanding the foregoing, the
    Secretary is authorized, to temporarily suspend the requirement
    for export marketing certificates for the period beginning July
    1, 1971, and ending June 30, 1974.
      [(c) Upon the giving of a bond or other undertaking
    satisfactory to the Secretary to secure the purchase of and
    payment for such marketing certificates as may be required, and
    subject to such regulations as he may prescribe, any person
    required to have marketing certificates in order to market or
    export a commodity may be permitted to market any such
    commodity without having first acquired marketing certificates.
      [(d) As used in this subtitle, the term ``food products''
    means flour (excluding flour second clears not used for human
    consumption as determined by the Secretary), semolina, farina,
    bulgur, beverage, and any other product composed wholly or
    partly of wheat which the Secretary may determine to be a food
    product. The Secretary may at his election administer the
    exemption for wheat processed into flour second clears through
    refunds either to processors of such wheat or to the users of
    such clears. For the purpose of such refunds, the wheat
    equivalent of flour second clears may be determined on the
    basis of conversion factors authorized by section 379f of the
    Agricultural Adjustment Act of 1938, even though certificates
    had been surrendered on the basis of the weight of the wheat.

           [ASSISTANCE IN PURCHASE AND SALE OF MARKETING CERTIFICATES

      [Sec. 379e. For the purpose of facilitating the purchase and
    sale of marketing certificates, the Commodity Credit
    Corporation is authorized to issue, buy, and sell marketing
    certificates in accordance with regulations prescribed by the
    Secretary. Such regulations may authorize the Corporation to
    issue and sell certificates in excess of the quantity of
    certificates which it purchases. Such regulations may authorize
    the Corporation in the sale of marketing certificates to
    charge, in addition to the face value thereof an amount
    determined by the Secretary to be appropriate to cover
    estimated administrative costs in connection with the purchase
    and sale of the certificates and estimated interest incurred on
    funds of the Corporation invested in certificates purchased by
    it. Notwithstanding any other provision of this Act, Commodity
    Credit Corporation shall sell marketing certificates for the
    marketing years for the 1966 through the 1970 wheat crops to
    persons engaged in the processing of food products at the face
    value thereof less any amount which price support for wheat
    accompanied by domestic certificates exceeds $2 per bushel.
    Notwithstanding any other provision of this Act, Commodity
    Credit Corporation shall sell marketing certificates for the
    marketing years for the 1971, 1972, and 1973 crops of wheat to
    persons engaged in the processing of food products but in
    determining the cost to processors the face value shall be 75
    cents per bushel.

                              [CONVERSION FACTORS

      [Sec. 379f. The Secretary shall establish conversion factors
    which shall be used to determine the amount of wheat contained
    in any food product. The conversion factor for any such food
    product shall be determined upon the basis of the weight of
    wheat used in the manufacture of such product.

                      [AUTHORITY TO FACILITATE TRANSITION

      [Sec. 379g. (a) The Secretary is authorized to take such
    action as he determines to be necessary to facilitate the
    transition from the program currently in effect to the program
    provided for in this subtitle. Notwithstanding any other
    provision of this subtitle, such authority shall include, but
    shall not be limited, to the authority to exempt all or a
    portion of the wheat or food products made therefrom in the
    channels of trade on the effective date of the program under
    this subtitle from the marketing restrictions in subsection (b)
    of section 379d, or to sell certificates to persons owning such
    wheat or food products at such prices as the Secretary may
    determine. Any such certificate shall be issued by Commodity
    Credit Corporation.
      [(b) Whenever the face value per bushel of domestic marketing
    certificates for a marketing year is substantially different
    from the face value of domestic marketing certificates for the
    preceding marketing year, the Secretary is authorized to take
    such action as he determines necessary to facilitate the
    transition between marketing years. Notwithstanding any other
    provision of this subtitle, such authority shall include, but
    shall not be limited to, the authority to sell certificates to
    persons engaged in the processing of wheat into food products
    covering such quantities of wheat, at such prices, and under
    such terms and conditions as the Secretary may by regulation
    provide. Any such certificate shall be issued by Commodity
    Credit Corporation.
      [(c) The Secretary is authorized to take such action as he
    determines to be necessary to facilitate the transition from
    the certificate program provided for under section 379d to a
    program under which no certificates are required.
    Notwithstanding any other provision of law, such authority
    shall include, but shall not be limited to the authority to
    exempt all or a portion of wheat or food products made
    therefrom in the channels of trade on July 1, 1973, from the
    marketing restrictions in subsection (b) of section 379d, or to
    sell certificates to persons owning such wheat or food products
    made therefrom at such price and under such terms and
    conditions as the Secretary may determine. Any such certificate
    shall be issued by the Commodity Credit Corporation. Nothing
    herein shall authorize the Secretary to require certificates on
    wheat processed after June 30, 1973.

                              [REPORTS AND RECORDS

      [Sec. 379h. This section shall apply to processors of wheat,
    warehousemen and exporters of wheat and food products, and all
    persons purchasing, selling, or otherwise dealing in wheat
    marketing certificates. Any such person shall, from time to
    time on request of the Secretary, report to the Secretary such
    information and keep such records as the Secretary finds to be
    necessary to enable him to carry out the provisions of this
    subtitle. Such information shall be reported and such records
    shall be kept in such manner as the Secretary shall prescribe.
    For the purpose of ascertaining the correctness of any report
    made or record kept, or of obtaining information required to be
    furnished in any report, but not so furnished, the Secretary is
    hereby authorized to examine such books, papers, records,
    accounts, correspondence, contracts, documents, and memorandums
    as he has reason to believe are relevant and are within the
    control of such person.

                                   [PENALTIES

      [Sec. 379i. (a) Any person who knowingly violates or attempts
    to violate or who knowingly participates or aids in the
    violation of any of the provisions of subsection (b) of section
    379d of this Act shall forfeit to the United States a sum equal
    to two times the face value of the marketing certificates
    involved in such violation. Such forfeiture shall be
    recoverable in a civil action brought in the name of the United
    States.
      [(b) Any person, except a producer in his capacity as a
    producer, who knowingly violates or attempts to violate or who
    knowingly participates or aids in the violation of any of the
    provision of this subtitle, or of any regulation, governing the
    acquisition, disposition, or handling of marketing certificates
    or who knowingly fails to make any report or keep any record as
    required by section 379h shall be deemed guilty of a
    misdemeanor and upon conviction thereof shall be subject to a
    fine of not more than $5,000 for each violation.
      [(c) Any person who, in his capacity as a producer, knowingly
    violates or attempts to violate or participates or aids in the
    violation of any provision of this subtitle, or of any
    regulation governing the acquisition, disposition, or handling
    of marketing certificates or fails to make any report or keep
    any record as required by section 379h shall, (i) forfeit any
    right to receive marketing certificates, in whole or in part as
    the Secretary may determine, with respect to the farm or farms
    and for the marketing year with respect to which any such act
    or default is committed, or (ii), if such marketing
    certificates have already been issued, pay to the Secretary,
    upon demand, the amount of the face value of such certificates,
    or such part thereof as the Secretary may determine. Such
    determination by the Secretary with respect to the amount of
    such marketing certificates to be forfeited or the amount to be
    paid by such producer shall take into consideration the
    circumstances relating to the act or default committed and the
    seriousness of such act or default.
      [(d) Any persons who falsely makes, issues, alters, forges,
    or counterfeits any marketing certificate, or with fraudulent
    intent possesses, transfers, or uses any such falsely made,
    issued, altered, forged, or counterfeited marketing
    certificate, shall be deemed guilty of a felony and upon
    conviction thereof shall be subject to a fine of not more than
    $10,000 or imprisonment of not more than ten years, or both.

                                  [REGULATIONS

      [Sec. 379j. The Secretary shall prescribe such regulations as
    may be necessary to carry out the provisions of this subtitle
    including but not limited to regulations governing the
    acquisition, disposition, or handling of marketing
    certificates.]
              * * * * * * *

            Subtitle F--Miscellaneous Provisions and Appropriations

                             PART I--MISCELLANEOUS

              * * * * * * *
      Sec. 390A. The Secretary, in carrying out programs under
    section 32 of Public Law Numbered 320, Seventy-fourth Congress,
    approved August 24, 1935, as amended, and section 6 of the
    National School Lunch Act may utilize the services and
    facilities of the Commodity Credit Corporation (including but
    not limited to procurement by contract), and make advance
    payments to it.
      Sec. 390B. (a) In order to prevent the waste of commodities
    whether in private stocks or acquired through price-support
    operations by the Commodity Credit Corporation before they can
    be disposed of in normal domestic channels without impairment
    of the price-support program or sold abroad at competitive
    world prices, the Commodity Credit Corporation is authorized,
    on such terms and under such regulations as the Secretary may
    deem in the public interest: (1) upon application, to make such
    commodities available to any Federal agency for use in making
    payment for commodities not produced in the United States; (2)
    to barter or exchange such commodities for strategic or other
    materials as authorized by law; (3) in the case of food
    commodities to donate such commodities to the Bureau of Indian
    Affairs and to such State, Federal, or private agency or
    agencies as may be designated by the proper State or Federal
    authority and approved by the Secretary, for use in the United
    States in nonprofit school-lunch programs, in nonprofit summer
    camps for children, in the assistance of needy persons, and in
    charitable institutions, including hospitals and facilities, to
    the extent that they serve needy persons (including infants and
    children). In the case of (3) the Secretary shall obtain such
    assurance as he deems necessary that the recipients thereof
    will not diminish their normal expenditures for food by reason
    of such donation. In order to facilitate the appropriate
    disposal of such commodities, the Secretary may from time to
    time estimate and announce the quantity of such commodities
    which he anticipates will become available for distribution
    under (3). The Commodity Credit Corporation may pay, with
    respect to commodities disposed of under this subsection,
    reprocessing, packaging, transporting, handling, and other
    charges accruing up to the time of their delivery to a Federal
    agency or to the designated State or private agency. In
    addition, in the case of food commodities disposed of under
    this subsection, the Commodity Credit Corporation may pay the
    cost of processing such commodities into a form suitable for
    home or institutional use, such processing to be accomplished
    through private trade facilities to the greatest extent
    possible. For the purpose of this subsection the terms
    ``State'' and ``United States'' include the District of
    Columbia and any Territory or possession of the United States.
      Dairy products acquired by the Commodity Credit Corporation
    through price support operations may, insofar as they can be
    used in the United States in nonprofit school lunch and other
    nonprofit child feeding programs, in the assistance of needy
    persons, and in charitable institutions, including hospitals,
    to the extent that needy persons are served, be donated for any
    such use prior to any other use or disposition. Notwithstanding
    any other provision of law, such dairy products may be donated
    for distribution to needy households in the United States and
    to meet the needs of persons receiving nutrition assistance
    under the Older Americans Act of 1965.
      (b)(1) The Secretary, subject to the requirements of
    paragraph (10), may furnish eligible commodities for carrying
    out programs of assistance in developing countries and friendly
    countries under titles II and III of the Agricultural Trade
    Development and Assistance Act of 1954 and under the Food for
    Progress Act of 1985, as approved by the Secretary, and for
    such purposes as are approved by the Secretary. To ensure that
    the furnishing of commodities under this subsection is
    coordinated with and complements other United States foreign
    assistance, assistance under this subsection shall be
    coordinated through the mechanism designated by the President
    to coordinate assistance under the Agricultural Trade
    Development and Assistance Act of 1954.
      (2) As used in this subsection, the term ``eligible
    commodities'' means--
              (A) dairy products, wheat, rice, feed grains, and
            oilseeds acquired by the Commodity Credit Corporation
            through price support operations, and the products
            thereof, that the Secretary determines meet the
            criteria specified in subsection (a); and
              (B) such other edible agricultural commodities as may
            be acquired by the Secretary or the Commodity Credit
            Corporation in the normal course of operations and that
            are available for disposition under this subsection,
            except that no such commodities may be acquired for the
            purpose of their use under this subsection.
      (3)(A) Commodities may not be made available for disposition
    under this subsection in amounts that (i) will, in any way,
    reduce the amounts of commodities that traditionally are made
    available through donations to domestic feeding programs or
    agencies, or (ii) will prevent the Secretary from fulfilling
    any agreement entered into by the Secretary under a payment-in-
    kind program under this Act or other Acts administered by the
    Secretary.
      (B)(i) The requirements of section 403(a) of the Agricultural
    Trade Development and Assistance Act of 1954 shall apply with
    respect to commodities furnished under this subsection.
    Commodities may not be furnished for disposition to any country
    under this subsection except on determinations by the Secretary
    that--
              (I) the receiving country has the absorptive capacity
            to use the commodities efficiently and effectively; and
              (II) such disposition of the commodities will not
            interfere with usual marketings of the United States,
            nor disrupt world prices of agricultural commodities
            and normal patterns of commercial trade with developing
            countries.
      (ii) The requirement for safeguarding usual marketings of the
    United States shall not be used to prevent the furnishing under
    this subsection of any eligible commodity for use in countries
    that--
              (I) have not traditionally purchased the commodity
            from the United States; or
              (II) do not have adequate financial resources to
            acquire the commodity from the United States through
            commercial sources or through concessional sales
            arrangements.
      (C) The Secretary shall take reasonable precautions to ensure
    that--
              (i) commodities furnished under this subsection will
            not displace or interfere with sales that otherwise
            might be made; and
              (ii) sales or barter under paragraph (7) will not
            unduly disrupt world prices of agricultural commodities
            nor normal patterns of commercial trade with friendly
            countries.
      (D) If eligible commodities are made available under this
    subsection to a friendly country, nonprofit and voluntary
    agencies and cooperatives shall also be eligible to receive
    commodities for food aid programs in the country.
      (4) Agreements may be entered into under this subsection to
    provide eligible commodities in installments over an extended
    period of time. In agreements with recipients of eligible
    commodities under this subsection (including nonprofit and
    voluntary agencies or cooperatives), subject to the
    availability of commodities each fiscal year, the Secretary, on
    request, shall approve multiyear agreements to make
    agricultural commodities available for distribution or sale by
    the recipients if the agreements otherwise meet the
    requirements of this subsection.
      (5)(A) Section 406 of the Agricultural Trade Development and
    Assistance Act of 1954 shall apply to the commodities furnished
    under this subsection.
      (B) The Commodity Credit Corporation may pay the processing
    and domestic handling costs incurred, as authorized under this
    subsection, in the form of eligible commodities, as defined in
    paragraph (2)(A), if the Secretary determines that such in-kind
    payment will not disrupt domestic markets.
      (6) The cost of commodities furnished under this subsection,
    and expenses incurred under section 406 of the Agricultural
    Trade Development and Assistance Act of 1954 in connection with
    those commodities, shall be in addition to the level of
    assistance programmed under that Act and shall not be
    considered expenditures for international affairs and finance.
      (7) Eligible commodities furnished under this subsection may
    be sold or bartered only with the approval of the Secretary and
    solely as follows:
              (A) Sales and barter that are incidental to the
            donation of the commodities or products.
              (B) Sales and barter to finance the distribution,
            handling, and processing costs of the donated
            commodities or products in the importing country or in
            a country through which such commodities or products
            must be transshipped, or other activities in the
            importing country that are consistent with providing
            food assistance to needy people.
              (C) Sales and barter of commodities and products
            furnished to intergovernmental agencies or
            organizations, insofar as they are consistent with
            normal programming procedures in the distribution of
            commodities by those agencies or organizations.
              (D)(i) Sales of commodities and products furnished to
            nonprofit and voluntary agencies, or cooperatives, for
            food assistance under agreements that provide for the
            use, by the agency or cooperative, of foreign currency
            proceeds generated from such sale of commodities or
            products for the purposes established in clause (ii) of
            this subparagraph.
              (ii) Foreign currencies generated from partial or
            full sales or barter of commodities by a nonprofit and
            voluntary agency or cooperative shall be used--
                      (I) to transport, store, distribute, and
                    otherwise enhance the effectiveness of the use
                    of commodities and the products thereof donated
                    under this section; and
                      (II) to implement income generating,
                    community development, health, nutrition,
                    cooperative development, agricultural
                    programs,  and  other  developmental
                    activities.
            In addition, foreign currency proceeds generated in
            Poland may also be used by governmental and
            nongovernmental agencies or cooperatives for eligible
            activities approved by the joint commission established
            pursuant to section 2226 of the American Aid to Poland
            Act of 1988 and by the United States chief of
            diplomatic mission in Poland that would improve the
            quality of life of the Polish people and would
            strengthen and support the activities of governmental
            or private, nongovernmental independent institutions in
            Poland. Activities eligible under the preceding
            sentence include--
                      (I) any project undertaken in Poland under
                    the auspices of the Charitable Commission of
                    the Polish Catholic Episcopate for the benefit
                    of handicapped or orphaned children;
                      (II) any project for the reconstruction,
                    renovation, or maintenance of the Research
                    Center on Jewish History and Culture of the
                    Jagiellonian University of Krakow, Poland,
                    established for the study of events related to
                    the Holocaust in Poland;
                      (III) any other project or activity which
                    strengthens and supports private and
                    independent sectors of the Polish economy,
                    especially independent farming and agriculture;
                    and
                      (IV) the Polish Catholic Episcopate's Rural
                    Water Supply Foundation.
              (iii) Except as otherwise provided in clause (v),
            such agreements, taken together for each fiscal year,
            shall provide for sales of commodities and products for
            foreign currency proceeds in amounts that are, in the
            aggregate, not less than 10 percent of the aggregate
            value of all commodities and products furnished, or the
            minimum tonnage required, whichever is greater, for
            carrying out programs of assistance under this
            subsection in such fiscal year. The minimum allocation
            requirements of this clause apply with respect to
            commodities and products made available under this
            subsection for carrying out programs of assistance
            under titles II and III of the Agricultural Trade
            Development and Assistance Act of 1954, and not with
            respect to commodities and products made available to
            carry out the Food for Progress Act of 1985.
              (iv) Foreign currency proceeds generated from the
            sale of commodities or products under this subparagraph
            shall be expended within the country of origin within
            one year of acquisition of such currency, except that
            the Secretary may permit the use of such proceeds (I)
            in countries other than the country of origin as
            necessary to expedite the transportation of commodities
            and products furnished under this subsection, (II)
            after one year of acquisition as appropriate to achieve
            the purposes of clause (i), and (III) in a country
            other than the country of origin, if such proceeds are
            generated in a currency generally accepted in such
            other country.
              (v) The provisions of clause (iii) of this
            subparagraph establishing minimum annual allocations
            for sales and use of proceeds shall not apply to the
            extent that there have not been sufficient requests for
            such sales and use of proceeds nor to the extent
            required under paragraph (3).
              (E) Sales and barter to cover expenses incurred under
            paragraph (5)(a).
              (F) The provisions of sections 403(i) and 407(c) of
            the Agricultural Trade Development and Assistance Act
            of 1954 shall apply to donations, sales and barters of
            eligible commodities under this subsection.
    No portion of the proceeds or services realized from sales or
    barter under this paragraph may be used to meet operating and
    overhead expenses, except as otherwise provided in subparagraph
    (C) and except for personnel and administrative costs incurred
    by local cooperatives.
      (8)(A) To the maximum extent practicable, expedited
    procedures shall be used in the implementation of this
    subsection.
      (B) The Secretary shall be responsible for regulations
    governing sales and barter, and the use of foreign currency
    proceeds, under paragraph (7) of this subsection that will
    provide reasonable safeguards to prevent the occurrence of
    abuses in the conduct of activities provided for in paragraph
    (7).
      (C)(i) If a proposal to make eligible commodities available
    under this subsection is submitted by a nonprofit and voluntary
    agency or cooperative with the concurrence of the appropriate
    United States Government field mission or if a proposal to make
    such commodities available to a nonprofit and voluntary agency
    or cooperative is submitted by the United States Government
    field mission, a decision on the proposal shall be provided
    within 45 days after receipt by the Agency for International
    Development office in Washington, D.C. The response shall
    detail the reasons for approval or denial of the proposal. If
    the proposal is denied, the response shall specify the
    conditions that would need to be met for the proposal to be
    approved.
      (ii) Not later than 30 days before the issuance of a final
    guideline issued to carry out this subsection, the Secretary
    shall--
              (I) provide notice of the proposed guideline to
            nonprofit and voluntary agencies and cooperatives that
            participate in programs under this subsection, and
            other interested persons, that the proposed guideline
            is available for review and comment;
              (II) make the proposed guideline available, on
            request, to nonprofit and voluntary agencies,
            cooperatives, and others; and
              (III) take any comments received into consideration
            before the issuance of the final guideline.
      (iii) Not later than 15 days after receipt of a call forward
    from a field mission for commodities or products that meets the
    requirements of this subsection, the order for the purchase or
    the supply, from inventory, of such commodities or products
    shall be transmitted to the Commodity Credit Corporation.
      (9)(A) Each recipient of commodities and products approved
    for sale or barter under paragraph (7) shall report to the
    Secretary information with respect to the items required to be
    included in the Secretary's report pursuant to clauses (i)
    through (iv) of subparagraph (B). Reports pursuant to this
    subparagraph shall be submitted in accordance with regulations
    of the Secretary. Such regulations shall require at least one
    report annually, to be submitted not later than December 31
    following the end of the fiscal year in which the commodities
    and products are received; except that a report shall not be
    required with respect to fiscal year 1985.
      (B) Not later than February 15, 1987, and annually
    thereafter, the Secretary shall report to the Congress on sales
    and barter, and use of foreign currency proceeds, under
    paragraph (7) during the preceding fiscal year. Such report
    shall include information on--
              (i) the quantity of commodities furnished for such
            sale or barter;
              (ii) the amount of funds (including dollar
            equivalents for foreign currencies) and value of
            services generated from such sales and barter in such
            fiscal year;
              (iii) how such funds and services were used;
              (iv) the amount of foreign currency proceeds that
            were used under agreements under subparagraph (D) of
            paragraph (7) in such fiscal year, and the percentage
            of the quantity of all commodities and products
            furnished under this subsection in such fiscal year
            such use represented;
              (v) the Secretary's best estimate of the amount of
            foreign currency proceeds that will be used, under
            agreements under subparagraph (D) of paragraph (7), in
            the then current fiscal year and the next following
            fiscal year (if all requests for such use are agreed
            to), and the percentage that such estimated use
            represents of the quantity of all commodities and
            products that the Secretary estimates will be furnished
            under this subsection in each such fiscal year;
              (vi) the effectiveness of such sales, barter, and use
            during such fiscal year in facilitating the
            distribution of commodities and products under this
            subsection;
              (vii) the extent to which sales, barter, or uses--
                      (I) displace or interfere with commercial
                    sales of United States agricultural commodities
                    and products that otherwise would be made,
                      (II) affect usual marketings of the United
                    States,
                      (III) disrupt world prices of agricultural
                    commodities or normal patterns of trade with
                    friendly countries, or
                      (IV) discourage local production and
                    marketing of agricultural commodities in the
                    countries in which commodities and products are
                    distributed under this subsection; and
              (viii) the Secretary's recommendations, if any, for
            changes to improve the conduct of sales, barter, or use
            activities under paragraph (7).
      (10)(A) Subject to the limitations established under
    paragraph (3), the Secretary shall make available for
    disposition under this subsection in each of the fiscal years
    1988 through 1990 not less than the minimum quantities of
    eligible commodities specified in subparagraph (B).
      (B) The minimum quantity of eligible commodities that shall
    be made available for disposition under this subsection in each
    fiscal year shall be--
              (i) 500,000 metric tons of wheat, rice, feed grains,
            and oilseeds from the Corporation's uncommitted stocks,
            or an amount equal to 10 percent of the Corporation's
            uncommitted stocks of wheat, rice, feed grains, and
            oilseeds as of the end of such fiscal year (as
            estimated by the Secretary), whichever is less; and
              (ii) 10 percent of the Corporation's uncommitted
            stocks of dairy products, but not less than 150,000
            metric tons of such products to the extent that
            uncommitted stocks are available.
    The Secretary shall make such estimation of expected year-end
    levels of the Corporation's uncommitted stocks prior to the
    beginning of the fiscal year or, in the case of fiscal year
    1986, prior to March 31, 1986. The Secretary's determination as
    to the amount of the Corporation's stocks that shall be made
    available for disposition under this subsection for such fiscal
    year shall be published in the Federal Register, along with a
    breakdown by kind of commodity and the quantity of each kind of
    commodity that shall be made available, before the beginning of
    such fiscal year or, in the case of fiscal year 1986, March 31,
    1986.
      (C) Of the aggregate amounts made available each fiscal year
    pursuant to both clauses (i) and (ii) of subparagraph (B), not
    less than 75,000 metric tons shall be made available to carry
    out the Food for Progress Act of 1985.
      (D)(i) The Secretary--
              (I) may waive the minimum quantity requirements of
            subparagraphs (A) and (B) for a fiscal year to the
            extent that the Secretary determines and reports to
            Congress that there are not sufficient requests for
            eligible commodities under this subsection for such
            fiscal year, except that the waiver authority of this
            subclause may not be used to waive the minimum quantity
            requirement of subparagraph (C);
              (II) may waive the minimum quantity requirement of
            subparagraph (C) in accordance with subsection (f)(2)
            of the Food for Progress Act of 1985; and
              (III) may waive the minimum quantity requirements of
            subparagraphs (A), (B), and (C) for a fiscal year, if
            the Secretary determines that the restrictions on the
            furnishing of commodities under paragraph (3) prevent
            the making available of commodities in such quantities.
      (ii) For any fiscal year in which the minimum levels of
    uncommitted Commodity Credit Corporation stocks specified in
    subparagraph (B) are not made available and during which any
    requests for commodities under this subsection are rejected,
    the Secretary shall provide a detailed, written explanation to
    Congress, at the end of such fiscal year, of the reasons for
    the rejections of such requests.
      (11)(A) The Secretary may furnish eligible commodities under
    this subsection in connection with (i) concessional sales
    agreements entered into under title I of the Agricultural Trade
    Development and Assistance Act of 1954 or other statutes, or
    (ii) agricultural export bonus or promotion programs carried
    out under the Commodity Credit Corporation Charter Act or other
    statutes.
      (B) Eligible commodities may be furnished by the Secretary
    under this subsection in connection with agreements by
    recipient countries to acquire additional agricultural
    commodities from the United States through commercial
    arrangements.
      (C) The amount of any commodity furnished under subparagraphs
    (A) and (B) of this paragraph in any fiscal year shall not be
    considered for the purpose of determining whether the
    requirements of paragraph (10)(A) of this subsection have been
    met during such fiscal year.
      (12) There is authorized to be appropriated for fiscal year
    1988, in addition to any other funds authorized to be
    appropriated, $1,000,000 for technical assistance for the sale
    or barter of commodities under paragraph (7) to strengthen
    nonprofit private organizations and cooperatives in the
    Philippines.
      (c) To prevent the waste of dairy products acquired by the
    Commodity Credit Corporation through price support operations,
    the Corporation, on such terms and under such regulations as
    the Secretary may prescribe, shall carry out a two-year pilot
    program under which the Corporation shall barter or exchange
    such dairy products, to the extent they are available, for
    forty thousand metric tons (consisting of twenty thousand
    metric tons in each year of the pilot program) of ultra-high
    temperature processed fluid milk. Such barter or exchange shall
    be effected on the basis of competitive bids submitted by
    domestic processors. The processed milk acquired by the
    Corporation under this subsection shall be available for
    donation through foreign governments and public and nonprofit
    private humanitarian organizations for the assistance of needy
    persons outside the United States, and the Corporation may pay,
    with respect to such processed milk donated under this
    subsection, transporting, handling, and other charges,
    including the cost of overseas delivery. Any donations under
    this subsection shall be coordinated through the mechanism
    designated by the President to coordinate assistance under the
    Agricultural Trade Development and Assistance Act of 1954 and
    shall be in addition to the level of assistance programmed
    under that Act. The pilot program shall be implemented by the
    Corporation as soon as practicable after the enactment of the
    Agricultural Programs Adjustment Act of 1984 and shall be
    operated for a period of two years after its implementation.
    Upon completion of the pilot program, the Secretary shall
    submit a report to Congress on its operation.
              * * * * * * *

            [TITLE IV--COTTON POOL PARTICIPATION TRUST CERTIFICATES

      [Sec. 401. There is hereby authorized to be appropriated,
    from any moneys in the Treasury of the United States not
    otherwise appropriated, the sum of $1,800,000, or so much
    thereof as may be required by the Secretary to accomplish the
    purposes hereinafter declared and authorized. The Secretary of
    the Treasury is hereby authorized and directed to pay to, or
    upon the order of, the Secretary, such a part or all of the sum
    hereby authorized to be appropriated at the request of the
    Secretary.
      [Sec. 402. The Secretary is hereby authorized to draw from
    the Treasury of the United States any part or all of the sum
    hereby authorized to be appropriated, and to deposit same to
    his credit with the Treasurer of the United States, under
    special symbol number, to be available for disbursement for the
    purposes hereinafter stated.
      [Sec. 403. The Secretary is hereby authorized to make
    available, from the sum hereby authorized to be appropriated,
    to the manager of the cotton pool, such sum or sums as may be
    necessary to enable the manager to purchase, take up, and
    cancel, subject to the restrictions hereinafter reserved, pool
    participation trust certificates, form C-5-I, where such
    certificates shall be tendered to the manager, cotton pool, by
    the person or persons shown by the records of the Department to
    have been the lawful holder and owner thereof on May 1, 1937,
    the purchase price to be paid for the certificates so purchased
    to be at the rate of $1 per five-hundred-pound bale for every
    bale or fractional part thereof represented by the certificates
    C-5-I. The Secretary is further authorized to pay directly, or
    to advance to, the manager of the cotton pool, to enable him to
    pay costs and expenses incident to the purchase of certificates
    as aforesaid and any balance remaining to the credit of the
    Secretary, or the manager, cotton pool, not required for the
    purchase of these certificates in accordance with provisions of
    this Act, shall, at the expiration of the purchase period, be
    covered into the Treasury of the United States as miscellaneous
    receipts.
      [Sec. 404. The authority of the manager, cotton pool, to
    purchase and pay for certificates hereunder shall extend to and
    include the 31st day of July 1938: Provided, That after
    expiration of the said limit, the purchase may be consummated
    of any certificates tendered to the manager, cotton pool, on or
    before July 31, 1938, but where for any reason the purchase
    price shall not have been paid by the manager, cotton pool. The
    Secretary is authorized to promulgate such rules, regulations,
    and requirements as in his discretion are proper to effectuate
    the general purposes of this title, which purpose is here
    stated to be specifically to authorize the purchase of
    outstanding pool participation trust certificates, form C-5-I,
    for a purchase price to be determined at the rate of $1 per
    bale, or twenty one-hundredths cent per pound, for the cotton
    evidenced by the said certificates, provided such certificates
    be tendered by holders thereof in accordance with regulations
    prescribed by the Secretary not later than the 31st day of July
    1938, and provided such certificates may not be purchased from
    persons other than those shown by the records of the Department
    to have been holders thereof on or before the 1st day of May
    1937.
      [Sec. 405. The Secretary is authorized to continue in
    existence the 1933 cotton producers pool so long as may be
    required to effectuate the purposes of this title. All expenses
    incident to the accomplishment of purposes of this title may be
    paid from funds hereby authorized to be appropriated, for which
    purpose the fund hereby authorized to be appropriated shall be
    deemed as supplemental to such funds as are now to the credit
    of the Secretary, reserved for the purpose of defraying
    operating expenses of the pool.
      [Sec. 406. After expiration of the time limit herein
    established, the certificates then remaining outstanding and
    not theretofore tendered to the manager, cotton pool, for
    purchase, shall not be purchased and no obligation on account
    thereof shall exist.
      [Sec. 407. Nothing in this title shall be construed to
    authorize the manager, cotton pool, to pay the assignee or any
    holder of such cotton pool participation trust certificates,
    form C-5-I, transferred on or before May 1, 1937, as shown by
    the records of the Department of Agriculture, more than the
    purchase price paid by the assignee or holder of such
    certificate with interest at the rate of 4 per centum per annum
    from the date of purchase, provided the amount paid such
    assignee shall not exceed $1 per bale. Before making payment to
    any assignee, whose certificates were transferred on or before
    May 1, 1937, such assignee shall file with the manager, cotton
    pool, an affidavit showing the amount paid by him for such
    certificate and the date of such payment, and the manager,
    cotton pool, is authorized to make payment to such assignee
    based upon the facts stated in said affidavit as aforesaid.]
                                  ----------

                            AGRICULTURAL ACT OF 1949

       AN ACT To provide assistance to the States in the establishment,
    maintenance, operation, and expansion of school-lunch programs, and for
                                other purposes.

      Be it enacted by the Senate and House of Representatives of
    the United States of America in Congress assembled, [That this
    Act may be cited as the ``Agricultural Act of 1949''.

                    [TITLE I--BASIC AGRICULTURAL COMMODITIES

      [Sec. 101. The Secretary of Agriculture (hereinafter called
    the ``Secretary'') is authorized and directed to make available
    through loans, purchases, or other operations, price support to
    cooperators for any crop of any basic agricultural commodity,
    if producers have not disapproved marketing quotas for such
    crop, at a level not in excess of 90 per centum of the parity
    price of the commodity nor less than the level provided in
    subsections (a), (b), and (c) as follows:

      [(a) For tobacco (except as otherwise provided herein), corn, and
        wheat, if the supply percentage as of the beginning of the marketing
        year is:        The level of support shall be not less than the
                        following percentage of the parity price:

        Not more than 102.........................................       90
        More than 102 but not more than 104.......................       89
        More than 104 but not more than 106.......................       88
        More than 106 but not more than 108.......................       87
        More than 108 but not more than 110.......................       86
        More than 110 but not more than 112.......................       85
        More than 112 but not more than 114.......................       84
        More than 114 but not more than 116.......................       83
        More than 116 but not more than 118.......................       82
        More than 118 but not more than 120.......................       81
        More than 120 but not more than 122.......................       80
        More than 122 but not more than 124.......................       79
        More than 124 but not more than 126.......................       78
        More than 126 but not more than 128.......................       77
        More than 128 but not more than 130.......................       76
        More than 130.............................................       75

    For rice of the 1959 and 1960 crops, the level of support shall
    be not less than 75 per centum of the parity price. For rice of
    the 1961 crop the level of support shall be not less than 70
    per centum of the parity price. For the 1962 and subsequent
    crops of rice the level of support shall be not less than 65
    per centum of the parity price.

      [(b) For cotton and peanuts, if the supply percentage as of the
        beginning of theThe level of support shall be not less than the
                        following percentage of the parity price:

        More than 108.............................................       90
        More than 108 but not more than 110.......................       89
        More than 110 but not more than 112.......................       88
        More than 112 but not more than 114.......................       87
        More than 114 but not more than 116.......................       86
        More than 116 but not more than 118.......................       85
        More than 118 but not more than 120.......................       84
        More than 120 but not more than 122.......................       83
        More than 122 but not more than 124.......................       82
        More than 124 but not more than 125.......................       81
        More than 125 but not more than 126.......................       80
        More than 126 but not more than 127.......................       79
        More than 127 but not more than 128.......................       78
        More than 128 but not more than 129.......................       77
        More than 129 but not more than 130.......................       76
        More than 130.............................................       75

      [(c) For tobacco, if marketing quotas are in effect, the
    level of support shall be 90 per centum of the parity price.
      [(d) Notwithstanding the foregoing provisions of this
    section--
              [(3) the level of price support to cooperators for
            any crop of a basic agricultural commodity, except
            tobacco, for which marketing quotas have been
            disapproved by producers shall be 50 per centum of the
            parity price of such commodity; and no price support
            shall be made available for any crop of tobacco for
            which marketing quotas have been disapproved by
            producers;
              [(5) price support may be made available to
            noncooperators at such levels, not in excess of the
            level of price support to cooperators, as the Secretary
            determines will facilitate the effective operation of
            the program.
              [(7) Where a State is designated under section 335(e)
            of the Agricultural Adjustment Act of 1938, as amended,
            as outside the commercial wheat-producing area for any
            crop of wheat, the level of price support for wheat to
            cooperators in such State for such crop of wheat shall
            be 75 per centum of the level of price support to
            cooperators in the commercial wheat-producing area.

    [SEC. 101B. LOANS, PAYMENTS, AND ACREAGE REDUCTION PROGRAMS FOR THE
                        1991 THROUGH 1995 CROPS OF RICE.

      [(a) Loans and Purchases.--
              [(1) In general.--Except as otherwise provided in
            this subsection, the Secretary shall make available to
            producers on a farm nonrecourse loans and purchases for
            each of the 1991 through 1995 crops of rice produced on
            the farm at a level that is not less than the higher
            of--
                      [(A) 85 percent of the simple average price
                    received by producers, as determined by the
                    Secretary, during the marketing years for the
                    immediately preceding 5 crops of rice,
                    excluding the year in which the average price
                    was the highest and the year in which the
                    average price was the lowest in the period; or
                      [(B) $6.50 per hundredweight.
              [(2) Maximum reduction.--The loan level for any crop
            of rice determined under paragraph (1) may not be
            reduced by more than 5 percent from the level
            determined for the preceding crop.
              [(3) Announcement of loan level and established
            price.--The loan and purchase level and the established
            price for each of the 1991 through 1995 crops of rice
            shall be announced not later than January 31 of each
            calendar year for the crop harvested in the calendar
            year or, in the case of the 1991 crop, as soon as
            practicable after the date of enactment of this
            section.
              [(4) Term.--A loan made under this subsection shall
            have a term of not more than 9 months beginning after
            the month in which the application for the loan is
            made.
              [(5) Marketing loan provisions.--
                      [(A) In general.--In order to ensure that a
                    competitive market position is maintained for
                    rice, the Secretary shall permit a producer to
                    repay a loan made under paragraph (1) for a
                    crop at a level that is the lesser of--
                              [(i) the loan level determined for
                            the crop; or
                              [(ii) the higher of--
                                      [(I) the loan level
                                    determined for the crop
                                    multiplied by 70 percent; or
                                      [(II) the prevailing world
                                    market price for rice, as
                                    determined by the Secretary.
                      [(B) Prevailing world market price.--The
                    Secretary shall prescribe by regulation--
                              [(i) a formula to define the
                            prevailing world market price for rice;
                            and
                              [(ii) a mechanism by which the
                            Secretary shall announce periodically
                            the prevailing world market price for
                            rice.
                      [(C) Producer purchase of marketing
                    certificates.--
                              [(i) In general.--As a condition of
                            permitting a producer to repay a loan
                            as provided in subparagraph (A), the
                            Secretary may require a producer to
                            purchase marketing certificates equal
                            in value to an amount that does not
                            exceed one-half the difference, as
                            determined by the Secretary, between
                            the amount of the loan obtained by the
                            producer and the amount of the loan
                            repayment.
                              [(ii) Redemption for rice or cash.--
                            The certificates shall be redeemable
                            for agricultural commodities owned by
                            the Commodity Credit Corporation valued
                            at the prevailing market price, as
                            determined by the Secretary or for
                            cash, under such terms and conditions
                            as the Secretary may prescribe.
                              [(iii) Redemption, marketing, or
                            exchange.--The Commodity Credit
                            Corporation, under regulations
                            prescribed by the Secretary, shall
                            assist any person receiving marketing
                            certificates under this subparagraph in
                            the redemption or marketing or exchange
                            of the certificates at such times, in
                            such manner, and at such price levels
                            as the Secretary determines will best
                            effectuate the purposes of the program
                            established under this section.
                              [(iv) Charges.--If any such
                            certificate is not presented for
                            redemption or marketing within a
                            reasonable number of days after
                            issuance, as determined by the
                            Secretary, reasonable costs of storage
                            and other carrying charges, as
                            determined by the Secretary, shall be
                            deducted from the value of the
                            certificate for the period beginning
                            after the reasonable number of days and
                            ending with the date of the
                            presentation of the certificate to the
                            Commodity Credit Corporation.
                              [(v) Designation of commodities and
                            products.--Insofar as practicable, the
                            Secretary shall permit owners of
                            certificates to designate the
                            commodities and the products thereof,
                            including storage sites thereof, the
                            owners would prefer to receive in
                            exchange for certificates.
                              [(vi) Sales price restrictions.--
                            Notwithstanding any other provision of
                            law, any price restrictions that may
                            otherwise apply to the disposition of
                            agricultural commodities by the
                            Commodity Credit Corporation shall not
                            apply to the redemption of certificates
                            under this subparagraph.
                              [(vii) Displacement.--The Secretary
                            shall take such measures as may be
                            necessary to prevent the marketing or
                            exchange of agricultural commodities
                            and the products thereof for
                            certificates under this subparagraph
                            from adversely affecting the income of
                            producers of the commodities or
                            products.
                              [(viii) Transfers.--Under regulations
                            prescribed by the Secretary,
                            certificates issued under this
                            subparagraph may be transferred to
                            other persons approved by the
                            Secretary.
                      [(D) Certificates to maintain
                    competitiveness.--
                              [(i) In general.--Notwithstanding any
                            other provision of law, whenever,
                            during the period beginning August 1,
                            1991, and ending July 31, 1996, the
                            prevailing world market price for a
                            class of rice (adjusted to United
                            States quality and location), as
                            determined by the Secretary, is below
                            the current loan repayment rate for
                            that class of rice, to make United
                            States rice competitive in world
                            markets and to maintain and expand
                            exports of rice produced in the United
                            States, the Commodity Credit
                            Corporation shall make payments,
                            through the issuance of marketing
                            certificates, to persons who have
                            entered into an agreement with the
                            Commodity Credit Corporation to
                            participate in the program established
                            under this subparagraph. The payments
                            shall be made in such monetary amounts
                            and subject to such terms and
                            conditions as the Secretary determines
                            will make rice produced in the United
                            States available at competitive prices
                            consistent with the purposes of this
                            subparagraph.
                              [(ii) Value.--The value of each
                            certificate issued under this
                            subparagraph shall be based on the
                            difference between--
                                      [(I) the loan repayment rate
                                    for the class of rice; and
                                      [(II) the prevailing world
                                    market price for the class of
                                    rice, as determined by the
                                    Secretary.
                              [(iii) Terms and conditions of
                            certificates.--Marketing certificates
                            issued under this subparagraph shall be
                            subject to the same terms and
                            conditions as certificates issued under
                            subparagraph (C).
              [(6) Simple average price.--For purposes of this
            section, the simple average price received by producers
            for the immediately preceding marketing year shall be
            based on the latest information available to the
            Secretary at the time of the determination.
      [(b) Loan Deficiency Payments.--
              [(1) In general.--The Secretary shall, for each of
            the 1991 through 1995 crops of rice, make payments
            (hereafter in this section referred to as ``loan
            deficiency payments'') available to producers who,
            although eligible to obtain a loan or purchase
            agreement under subsection (a), agree to forgo
            obtaining the loan or agreement in return for payments
            under this subsection.
              [(2) Computation.--A payment under this subsection
            shall be computed by multiplying--
                      [(A) the loan payment rate; by
                      [(B) the quantity of rice the producer is
                    eligible to place under loan (or obtain a
                    purchase agreement) but for which the producer
                    forgoes obtaining the loan or agreement in
                    return for payments under this subsection.
              [(3) Loan payment rate.--For purposes of this
            subsection, the loan payment rate shall be the amount
            by which--
                      [(A) the loan level determined for the crop
                    under subsection (a); exceeds
                      [(B) the level at which a loan may be repaid
                    under subsection (a).
              [(4) Marketing certificates.--The Secretary may make
            up to one-half the amount of a payment under this
            subsection available in the form of marketing
            certificates, subject to the terms and conditions
            provided in subsection (a)(5)(C).
      [(c) Payments.--
              [(1) Deficiency payments.--
                      [(A) In general.--The Secretary shall make
                    available to producers payments (hereafter in
                    this section referred to as ``deficiency
                    payments'') for each of the 1991 through 1995
                    crops of rice in an amount computed by
                    multiplying--
                              [(i) the payment rate; by
                              [(ii) the payment acres for the crop;
                            by
                              [(iii) the farm program payment yield
                            established for the crop for the farm.
                      [(B) Payment rate.--
                              [(i) Payment rate for 1991 through
                            1993 crops.--The payment rate for each
                            of the 1991 through 1993 crops of rice
                            shall be the amount by which the
                            established price for the crop of rice
                            exceeds the higher of--
                                      [(I) the national average
                                    market price received by
                                    producers during the first 5
                                    months of the marketing year
                                    for the crop, as determined by
                                    the Secretary; or
                                      [(II) the loan level
                                    determined for the crop.
                              [(ii) Payment rate of 1994 and 1995
                            crops.--The payment rate for each of
                            the 1994 and 1995 crops of rice shall
                            be the amount by which the established
                            price for the crop of rice exceeds the
                            higher of--
                                      [(I) the lesser of--
                                              [(aa) the national
                                            average market price
                                            received by producers
                                            during the calendar
                                            year that contains the
                                            first 5 months of the
                                            marketing year for the
                                            crop, as determined by
                                            the Secretary; or
                                              [(bb) the national
                                            average market price
                                            received by producers
                                            during the first 5
                                            months of the marketing
                                            year for the crop, as
                                            determined by the
                                            Secretary, plus an
                                            appropriate amount that
                                            is fair and equitable
                                            in relation to wheat
                                            and feed grains (as
                                            determined by the
                                            Secretary); or
                                      [(II) the loan level
                                    determined for the crop.
                              [(iii) Minimum established price.--
                            The established price for rice shall
                            not be less than $10.71 per
                            hundredweight for each of the 1991
                            through 1995 crops.
                      [(C) Payment acres.--Payment acres for a crop
                    shall be the lesser of--
                              [(i) the number of acres planted to
                            the crop for harvest within the
                            permitted acreage; or
                              [(ii) 85 percent of the crop acreage
                            base for the crop for the farm less the
                            quantity of reduced acreage (as
                            determined under subsection (e)(2)(D)).
                      [(D) 50/85 program.--
                              [(i) In general.--If an acreage
                            limitation program under subsection
                            (e)(2) is in effect for a crop of rice
                            and the producers on a farm devote a
                            portion of the maximum payment acres
                            for rice as calculated under
                            subparagraph (C)(ii) for equal to more
                            than 8 percent for each of the 1991
                            through 1993 crops, and 15 percent for
                            each of the 1994 through 1997 crops
                            (except as provided in clause (v)(II)),
                            of such rice acreage of the farm for
                            the crop to conservation uses (except
                            as provided in subparagraph (E))--
                                      [(I) such portion of the
                                    maximum payment acres in excess
                                    of 8 percent for each of the
                                    1991 through 1993 crops, and 15
                                    percent for each of the 1994
                                    through 1997 crops (except as
                                    provided in clause (v)(II)), of
                                    such acreage devoted to
                                    conservation uses (except as
                                    provided in subparagraph (E))
                                    shall be considered to be
                                    planted to rice for the purpose
                                    of determining the acreage on
                                    the farm required to be devoted
                                    to conservation uses in
                                    accordance with subsection
                                    (e)(2)(D); and
                                      [(II) the producers shall be
                                    eligible for payments under
                                    this paragraph with respect to
                                    such acreage, subject to the
                                    compliance of the producers
                                    with clause (ii).
                              [(ii) Minimum planting requirement.--
                            To be eligible for payments under
                            clause (i), except as provided in
                            clauses (iv) and (v), the producers on
                            a farm must actually plant rice for
                            harvest on at least 50 percent of the
                            maximum payment acres for rice for the
                            farm.
                              [(iii) Deficiency payments.--
                            Notwithstanding any other provision of
                            this section, any producer who devotes
                            a portion of the maximum payment acres
                            for rice for the farm to conservation
                            uses (or other uses as provided in
                            subparagraph (E)) under this
                            subparagraph shall receive deficiency
                            payments on the acreage that is
                            considered to be planted to rice and
                            eligible for payments under this
                            subparagraph for the crop at a per-
                            hundredweight rate established by the
                            Secretary, except that the rate may not
                            be established at less than the
                            projected deficiency payment rate for
                            the crop, as determined by the
                            Secretary. Such projected payment rate
                            for the crop shall be announced by the
                            Secretary prior to the period during
                            which rice producers may agree to
                            participate in the program for the
                            crop.
                              [(iv) Quarantines.--If a State or
                            local agency has imposed in an area of
                            a State or county a quarantine on the
                            planting of rice for harvest on farms
                            in the area, the State committee
                            established under section 8(b) of the
                            Soil Conservation and Domestic
                            Allotment Act (16 U.S.C. 590h(b)) may
                            recommend to the Secretary that
                            payments be made under this paragraph,
                            without regard to the requirement
                            imposed under clause (ii), to producers
                            in the area who were required to forgo
                            the planting of rice for harvest on
                            acreage to alleviate or eliminate the
                            condition requiring the quarantine. If
                            the Secretary determines that the
                            condition exists, the Secretary may
                            make payments under this paragraph to
                            the producers. To be eligible for
                            payments under this clause, the
                            producers must devote the acreage to
                            conservation uses (except as provided
                            in subparagraph (E)).
                              [(v) Prevented planting and reduced
                            yields.--
                                      [(I) 1991 through 1993
                                    crops.--In the case of each of
                                    the 1991 through 1993 crops of
                                    rice, if an acreage limitation
                                    program under subsection (e) is
                                    in effect for any crop of rice
                                    and if the Secretary determines
                                    that producers on a farm are
                                    prevented from planting the
                                    acreage intended for rice to
                                    rice because of drought, flood,
                                    or other natural disaster, or
                                    other condition beyond the
                                    control of the producers, the
                                    Secretary shall make available
                                    to such producers payments
                                    under this subparagraph without
                                    regard to the requirement
                                    imposed under clause (ii). To
                                    be eligible for payments under
                                    this clause, the producers must
                                    devote the acreage to
                                    conservation uses (except as
                                    provided in subparagraph (E)).
                                    Any such acreage shall be
                                    considered to be planted to
                                    rice.
                                      [(II) 1994 through 1997
                                    crops.--In the case of each of
                                    the 1994 through 1997 crops of
                                    rice, producers on a farm shall
                                    be eligible to receive
                                    deficiency payments as provided
                                    in clause (iii) without regard
                                    to clause (ii) if an acreage
                                    limitation program under
                                    subsection (e) is in effect for
                                    the crop and--
                                              [(aa) the producers
                                            have been determined by
                                            the Secretary (in
                                            accordance with section
                                            503(c)) to be prevented
                                            from planting the crop
                                            or have incurred a
                                            reduced yield for the
                                            crop (due to a natural
                                            disaster) and the
                                            producers elect to
                                            devote a portion of the
                                            maximum payment acres
                                            for rice (as calculated
                                            under subparagraph
                                            (C)(ii)) equal to more
                                            than 8 percent of the
                                            rice acreage, to
                                            conservation uses; or
                                              [(bb) the producers
                                            elect to devote a
                                            portion of the maximum
                                            payment acres for rice
                                            (as calculated under
                                            subparagraph (C)(ii))
                                            equal to more than 8
                                            percent of the rice
                                            acreage, to alternative
                                            crops as provided in
                                            subparagraph (E).
                              [(vi) Crop acreage and payment
                            yield.--The rice crop acreage base and
                            rice farm program payment yield of the
                            farm shall not be reduced due to the
                            fact that a portion of the permitted
                            rice acreage of the farm was devoted to
                            conserving uses (except as provided in
                            subparagraph (E)) under this
                            subparagraph.
                              [(vii) Limitation.--Other than as
                            provided in clauses (i) through (vi),
                            payments may not be made under this
                            paragraph for any crop on a greater
                            acreage than the acreage actually
                            planted to rice.
                              [(viii) Conservation use acreage
                            under other programs.--Any acreage
                            considered to be planted to rice in
                            accordance with clauses (i) and (vi)
                            may not also be designated as
                            conservation use acreage for the
                            purpose of fulfilling any provisions
                            under any acreage limitation or land
                            diversion program requiring that the
                            producers devote a specified acreage to
                            conservation uses.
                      [(E) Alternative crops.--
                              [(i) Industrial and other crops.--The
                            Secretary may permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any part of
                            acreage otherwise required to be
                            devoted to conservation uses as a
                            condition of qualifying for payments
                            under subparagraph (D) to be devoted to
                            sweet sorghum, guar, castor beans,
                            plantago ovato, triticale, rye, millet,
                            mung beans, commodities for which no
                            substantial domestic production or
                            market exists but that could yield
                            industrial raw material being imported,
                            or likely to be imported, into the
                            United States, or commodities grown for
                            experimental purposes (including kenaf
                            and milkweed), subject to the following
                            sentence. The Secretary may permit the
                            acreage to be devoted to the production
                            only if the Secretary determines that--
                                      [(I) the production is not
                                    likely to increase the cost of
                                    the price support program; and
                                      [(II) the production is
                                    needed to provide an adequate
                                    supply of the commodity, or, in
                                    the case of commodities for
                                    which no substantial domestic
                                    production or market exists but
                                    that could yield industrial raw
                                    materials, the production is
                                    needed to encourage domestic
                                    manufacture of the raw material
                                    and could lead to increased
                                    industrial use of the raw
                                    material to the long-term
                                    benefit of United States
                                    industry.
                              [(ii) Sesame and crambe.--The
                            Secretary shall permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any part of
                            acreage otherwise required to be
                            devoted to conservation uses as a
                            condition of qualifying for payments
                            under subparagraph (D) to be devoted to
                            sesame and crambe. In implementing this
                            clause, if the Secretary determines
                            that sesame or crambe are considered
                            oilseeds under section 205, the
                            Secretary shall provide that, in order
                            to receive payments under subparagraph
                            (D), the producers shall agree to forgo
                            eligibility to receive a loan under
                            section 205 for the crop of sesame or
                            crambe produced on the farm.
              [(2) Crop insurance requirement.--A producer shall
            obtain catastrophic risk protection insurance coverage
            in accordance with section 427.
      [(d) Payment Yields.--The farm program payment yields for
    farms for each crop of rice shall be determined under title V.
      [(e) Acreage Reduction Programs.--
              [(1) In general.--
                      [(A) Establishment.--Notwithstanding any
                    other provision of this Act, if the Secretary
                    determines that the total supply of rice, in
                    the absence of an acreage limitation program,
                    will be excessive taking into account the need
                    for an adequate carry-over to maintain
                    reasonable and stable supplies and prices and
                    to meet a national emergency, the Secretary may
                    provide for any crop of rice an acreage
                    limitation program as described in paragraph
                    (2).
                      [(B) Agricultural resources conservation
                    program.--In making a determination under
                    subparagraph (A), the Secretary shall take into
                    consideration the number of acres placed in the
                    agricultural resources conservation program
                    established under subtitle D of title XII of
                    the Food Security Act of 1985 (16 U.S.C. 3831
                    et seq.).
                      [(C) Announcements.--
                              [(i) Preliminary announcement.--If
                            the Secretary elects to implement an
                            acreage limitation program for any crop
                            year, the Secretary shall make a
                            preliminary announcement of any such
                            program not later than December 1 of
                            the calendar year preceding the year in
                            which the crop is harvested (or, for
                            the 1992 crop, as soon as practicable
                            after the date of enactment of this
                            subparagraph). The preliminary
                            announcement shall include, among other
                            information determined necessary by the
                            Secretary, an announcement of the
                            uniform percentage reduction in the
                            rice crop acreage base described in
                            paragraph (2)(A).
                              [(ii) Final announcement.--Not later
                            than January 31 of the calendar year in
                            which the crop is harvested, the
                            Secretary shall make a final
                            announcement of the program. The
                            announcement shall include, among other
                            information determined necessary by the
                            Secretary, an announcement of the
                            uniform percentage reduction in the
                            rice crop described in paragraph
                            (2)(A).
                      [(D) Carry-over.--The Secretary shall carry
                    out an acreage limitation program described in
                    paragraph (2) for a crop of rice in a manner
                    that will result in carry-over stocks equal to
                    16.5 to 20 percent of the simple average of the
                    total disappearance of rice for each of the 3
                    marketing years preceding the year for which
                    the announcement is made. For the purpose of
                    this subparagraph, the term ``total
                    disappearance'' means all rice utilization,
                    including total domestic, total export, and
                    total residual disappearance.
              [(2) Acreage limitation program.--
                      [(A) Percentage reductions.--Except as
                    provided in paragraph (3), if a rice acreage
                    limitation program is announced under paragraph
                    (1), such limitation shall be achieved by
                    applying a uniform percentage reduction (from 0
                    to 35 percent) to the rice crop acreage base
                    for the crop for each rice-producing farm.
                      [(B) Compliance.--Except as provided in
                    section 504, producers who knowingly produce
                    rice in excess of the permitted rice acreage
                    for the farm, as established in accordance with
                    subparagraph (A), shall be ineligible for rice
                    loans, purchases, and payments with respect to
                    that farm.
                      [(C) Crop acreage bases.--Rice crop acreage
                    bases for each crop of rice shall be determined
                    under title V.
                      [(D) Acreage devoted to conservation uses.--A
                    number of acres on the farm shall be devoted to
                    conservation uses, in accordance with
                    regulations issued by the Secretary. Such
                    number shall be determined by multiplying the
                    rice crop acreage base by the percentage
                    reduction required by the Secretary. The number
                    of acres so determined is hereafter in this
                    subsection referred to as ``reduced acreage''.
                    The remaining acreage is hereafter in this
                    subsection referred to as ``permitted
                    acreage''. Permitted acreage may be adjusted by
                    the Secretary as provided in paragraph (3) and
                    in section 504.
                      [(E) Individual farm program acreage.--Except
                    as otherwise provided in subsection (c), the
                    individual farm program acreage shall be the
                    acreage planted on the farm to rice for harvest
                    within the permitted rice acreage for the farm
                    as established under this paragraph.
                      [(F) Planting designated crops on reduced
                    acreage.--
                              [(i) Definition of designated crop.--
                            As used in this subparagraph, the term
                            ``designated crop'' means a crop
                            defined in section 504(b)(1), excluding
                            any program crop as defined in section
                            502(3).
                              [(ii) In general.--Subject to clause
                            (iii), the Secretary may permit
                            producers on a farm to plant a
                            designated crop on no more than one-
                            half of the reduced acreage on the
                            farm.
                              [(iii) Limitations.--If the producers
                            on a farm elect to plant a designated
                            crop on reduced acreage under this
                            subparagraph--
                                      [(I) the amount of the
                                    deficiency payment that the
                                    producers are otherwise
                                    eligible to receive under
                                    subsection (c) shall be
                                    reduced, for each acre (or
                                    portion thereof) that is
                                    planted to the designated crop,
                                    by an amount equal to the
                                    deficiency payment that would
                                    be made with respect to a
                                    number of acres of the crop
                                    that the Secretary considers
                                    appropriate, except that if the
                                    producers on the farm are
                                    participating in a program
                                    established for more than one
                                    program crop, the amount of the
                                    reduction shall be determined
                                    by prorating the reduction
                                    based on the acreage planted or
                                    considered planted on the farm
                                    to all of such program crops;
                                    and
                                      [(II) the Secretary shall
                                    ensure that reductions in
                                    deficiency payments under
                                    subclause (I) are sufficient to
                                    ensure that this subparagraph
                                    will result in no additional
                                    cost to the Commodity Credit
                                    Corporation.
              [(3) Targeted option payments.--
                      [(A) In general.--Notwithstanding any other
                    provision of this section, if the Secretary
                    implements an acreage limitation program with
                    respect to any of the 1991 through 1995 crops
                    of rice and announces an acreage limitation
                    percentage of 20 percent or less, the Secretary
                    may make available to producers on a farm who
                    do not receive payments under subsection
                    (c)(1)(D) for such crop on the farm,
                    adjustments in the level of deficiency payments
                    that would otherwise be made available to the
                    producers if the producers exercise the payment
                    options provided in this paragraph.
                      [(B) Payment options.--If the Secretary
                    elects to carry out this paragraph, the
                    Secretary shall make the payment options
                    specified in subparagraphs (C) and (D)
                    available to producers who agree to make
                    adjustments in the quantity of acreage diverted
                    from the production of rice under an acreage
                    limitation program in accordance with this
                    paragraph.
                      [(C) Increased acreage limitation option.--
                              [(i) Increase in established price.--
                            If the Secretary elects to carry out
                            this paragraph, a producer shall be
                            eligible to receive an increase in the
                            established price for rice under clause
                            (ii) if the producer agrees to an
                            increase in the acreage limitation
                            percentage to be applied to the
                            producers' rice acreage base above the
                            acreage limitation percentage announced
                            by the Secretary.
                              [(ii) Method of calculation.--For the
                            purposes of calculating deficiency
                            payments to be made available to
                            producers who participate in the
                            program under this paragraph, the
                            Secretary shall increase the
                            established price for rice by an amount
                            determined by the Secretary, but not
                            less than 0.5 percent, nor more than 1
                            percent, for each 1 percentage point
                            increase in the acreage limitation
                            percentage applied to the producers'
                            rice acreage base.
                              [(iii) Limitation.--The acreage
                            limitation percentage to be applied to
                            the producers' rice acreage base shall
                            not be increased by more than 5
                            percentage points above the acreage
                            limitation percentage announced by the
                            Secretary.
                              [(iv) Adjustment for
                            underplantings.--In determining the
                            increased acreage limitation percentage
                            that is applied to the producer's rice
                            acreage base under this paragraph, the
                            Secretary shall exclude an amount of
                            acreage equal to the average difference
                            between the producer's permitted rice
                            acreage and the acreage actually
                            planted (including acreage devoted to
                            conserving uses under subsection
                            (c)(1)(D)) to rice for harvest during
                            the previous 2 years.
                      [(D) Decreased acreage limitation option.--
                              [(i) Decrease in acreage limitation
                            requirement.--If the Secretary elects
                            to carry out this paragraph, a producer
                            shall be eligible to decrease the
                            acreage limitation percentage
                            applicable to the producers' rice
                            acreage base (as announced by the
                            Secretary) if the producer agrees to a
                            decrease in the established price for
                            rice under clause (ii) for the purpose
                            of calculating deficiency payments to
                            be made available to the producer.
                              [(ii) Method of calculation.--For the
                            purposes of calculating deficiency
                            payments to be made available to
                            producers who choose the option set
                            forth in this subparagraph, the
                            Secretary shall decrease the
                            established price for rice by an amount
                            to be determined by the Secretary, but
                            not less than 0.5 percent, nor more
                            than 1 percent, for each 1 percentage
                            point decrease in the acreage
                            limitation percentage applied to the
                            producers' rice acreage base.
                              [(iii) Limitation.--A producer may
                            not choose to decrease the acreage
                            limitation percentage applicable to the
                            producers' rice acreage base under this
                            paragraph by more than one-half of the
                            announced acreage limitation
                            percentage.
                      [(E) Participation and production effects.--
                    Notwithstanding any other provision of this
                    paragraph, the Secretary shall, to the extent
                    practicable, ensure that the program provided
                    for in this paragraph does not have a
                    significant effect on program participation or
                    total production and shall be offered in such a
                    manner that the Secretary determines will
                    result in no additional budget outlays. The
                    Secretary shall provide an analysis of the
                    Secretary's determination to the Committee on
                    Agriculture of the House of Representatives and
                    the Committee on Agriculture, Nutrition, and
                    Forestry of the Senate.
              [(4) Administration.--
                      [(A) Protection from weeds and erosion.--The
                    regulations issued by the Secretary under
                    paragraph (2) with respect to acreage required
                    to be devoted to conservation uses shall assure
                    protection of the acreage from weeds and wind
                    and water erosion.
                      [(B) Annual or perennial cover.--
                              [(i) Required.--
                                      [(I) In general.--Except as
                                    provided in subclause (II) and
                                    paragraph (2), a producer who
                                    participates in an acreage
                                    reduction program established
                                    for a crop of rice under this
                                    subsection shall be required to
                                    plant to, or maintain as, an
                                    annual or perennial cover 50
                                    percent (or more at the option
                                    of the producer) of the acreage
                                    that is required to be removed
                                    from the production of rice,
                                    but not to exceed 5 percent (or
                                    more at the option of the
                                    producer) of the crop acreage
                                    base established for the crop.
                                      [(II) Arid areas.--Subclause
                                    (I) shall not apply with
                                    respect to arid areas
                                    (including summer fallow
                                    areas), as determined by the
                                    Secretary. If the Secretary
                                    determines any county in a
                                    State to be arid, the
                                    respective State committee
                                    established under section 8(b)
                                    of the Soil Conservation and
                                    Domestic Allotment Act (16
                                    U.S.C. 590h(b)) may designate
                                    any other county or counties or
                                    all of the State as arid for
                                    the purposes of this paragraph.
                                      [(III) Approval of cover
                                    crops and practices.--The State
                                    committee, after receiving
                                    recommendations from the county
                                    committees, shall approve
                                    appropriate crops planted or
                                    maintained as cover, including,
                                    as appropriate, annual or
                                    perennial native grasses and
                                    legumes or other vegetation.
                                    The State committee shall
                                    establish the final seeding
                                    date for the planting of the
                                    cover and shall approve
                                    appropriate cover crops or
                                    practices, after consulting the
                                    Soil Conservation Service State
                                    Conservationist regarding
                                    whether the crops or practices
                                    will sufficiently protect the
                                    land from weeds and wind and
                                    water erosion. After the
                                    Secretary establishes the State
                                    technical committee for the
                                    State pursuant to section 1261
                                    of the Food Security Act of
                                    1985 (16 U.S.C. 3861), the
                                    State committee shall consult
                                    with the technical committee
                                    (rather than the Soil
                                    Conservation Service State
                                    Conservationist) regarding
                                    whether the crops or practices
                                    will sufficiently protect the
                                    land from weeds and wind and
                                    water erosion.
                              [(ii) Multiyear program.--
                                      [(I) Cost-share assistance.--
                                    If a producer elects to
                                    establish a perennial cover
                                    capable of improving water
                                    quality or wildlife habitat on
                                    the acreage, the Commodity
                                    Credit Corporation shall make
                                    available cost-share assistance
                                    for 25 percent of the approved
                                    cost of establishing the cover
                                    on not more than 50 percent of
                                    the acreage that is required to
                                    be diverted from production,
                                    but not to exceed 5 percent (or
                                    more, at the option of the
                                    producer) of the crop acreage
                                    base established for a crop.
                                      [(II) Agreement of
                                    producer.--If a producer elects
                                    to establish a perennial cover
                                    on the acreage under this
                                    subparagraph and receives cost-
                                    share assistance from the
                                    Corporation with respect to the
                                    cover, the producer, under such
                                    terms and conditions as may be
                                    prescribed by the Secretary,
                                    taking into consideration
                                    guidelines established by the
                                    State technical committees
                                    established in subtitle G of
                                    title XII of the Food Security
                                    Act of 1985, shall agree to
                                    maintain the perennial cover
                                    for a minimum of 3 years.
                              [(iii) Conserving crops.--The
                            Secretary may permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any part of the
                            acreage to be devoted to sweet sorghum,
                            guar, sesame, castor beans, crambe,
                            plantago ovato, triticale, rye, mung
                            beans, milkweed, or other commodity, if
                            the Secretary determines that the
                            production is needed to provide an
                            adequate supply of the commodities, is
                            not likely to increase the cost of the
                            price support program, and will not
                            affect farm income adversely.
                      [(C) Haying and grazing.--
                              [(i) In general.--Except as provided
                            in clause (ii), haying and grazing of
                            reduced acreage, acreage devoted to a
                            conservation use under subsection
                            (c)(1)(D), and acreage diverted from
                            production under a land diversion
                            program established under this section
                            shall be permitted, except during any
                            consecutive 5-month period that is
                            established by the State committee
                            established under section 8(b) of the
                            Soil Conservation and Domestic
                            Allotment Act (16 U.S.C. 590h(b)) for a
                            State. The 5-month period shall be
                            established during the period beginning
                            April 1, and ending October 31, of a
                            year.
                              [(ii) Natural disasters.--In the case
                            of a natural disaster, the Secretary
                            may permit unlimited haying and grazing
                            on the acreage. The Secretary may not
                            exclude irrigated or irrigable acreage
                            not planted in alfalfa when exercising
                            the authority under this clause.
                      [(D) Water storage uses.--
                              [(i) In general.--The regulations
                            issued by the Secretary under paragraph
                            (2) with respect to acreage required to
                            be devoted to conservation uses shall
                            provide that land that has been
                            converted to water storage uses shall
                            be considered to be devoted to
                            conservation uses if the land was
                            devoted to wheat, feed grains, cotton,
                            rice, or oilseeds in at least 3 of the
                            immediately preceding 5 years. The land
                            shall be considered to be devoted to
                            conservation uses for the period that
                            the land remains in water storage uses,
                            but not to exceed 5 years subsequent to
                            its conversion to water storage uses.
                              [(ii) Limitations.--Land converted to
                            water storage uses for the purposes of
                            this subparagraph may not be devoted to
                            any commercial use, including
                            commercial fish production. The water
                            stored on the land may not be ground
                            water. The farm on which the land is
                            located must have been irrigated with
                            ground water during at least 1 of the
                            preceding 5 crop years.
              [(5) Land diversion program.--
                      [(A) In general.--The Secretary may make land
                    diversion payments to producers of rice,
                    whether or not an acreage limitation program
                    for rice is in effect, if the Secretary
                    determines that the land diversion payments are
                    necessary to assist in adjusting the total
                    national acreage of rice to desirable goals.
                    The land diversion payments shall be made to
                    producers who, to the extent prescribed by the
                    Secretary, devote to approved conservation uses
                    an acreage of cropland on the farm in
                    accordance with land diversion contracts
                    entered into by the Secretary with the
                    producers.
                      [(B) Amounts.--The amounts payable to
                    producers under land diversion contracts may be
                    determined through the submission of bids for
                    the contracts by producers in such manner as
                    the Secretary may prescribe or through such
                    other means as the Secretary determines
                    appropriate. In determining the acceptability
                    of contract offers, the Secretary shall take
                    into consideration the extent of the diversion
                    to be undertaken by the producers and the
                    productivity of the acreage diverted.
                      [(C) Limitation on diverted acreage.--The
                    Secretary shall limit the total acreage to be
                    diverted under agreements in any county or
                    local community so as not to affect adversely
                    the economy of the county or local community.
              [(6) Conservation practices.--
                      [(A) Wildlife food plots or habitat.--The
                    reduced acreage and additional diverted acreage
                    may be devoted to wildlife food plots or
                    wildlife habitat in conformity with standards
                    established by the Secretary in consultation
                    with wildlife agencies. The Secretary may pay
                    an appropriate share of the cost of practices
                    designed to carry out the purposes of this
                    subparagraph.
                      [(B) Public access.--The Secretary may
                    provide for an additional payment on the
                    acreage in an amount determined by the
                    Secretary to be appropriate in relation to the
                    benefit to the general public if the producer
                    agrees to permit, without other compensation,
                    access to all or such portion of the farm, as
                    the Secretary may prescribe, by the general
                    public, for hunting, trapping, fishing, and
                    hiking, subject to applicable State and Federal
                    regulations.
              [(7) Participation agreements.--
                      [(A) In general.--Producers on a farm
                    desiring to participate in the program
                    conducted under this subsection shall execute
                    an agreement with the Secretary providing for
                    the participation not later than such date as
                    the Secretary may prescribe.
                      [(B) Modification or termination.--The
                    Secretary may, by mutual agreement with
                    producers on a farm, modify or terminate any
                    such agreement if the Secretary determines the
                    action necessary because of an emergency
                    created by drought or other disaster or to
                    prevent or alleviate a shortage in the supply
                    of agricultural commodities. The Secretary may
                    modify the agreement under this subparagraph
                    for the purpose of alleviating a shortage in
                    the supply of agricultural commodities only if
                    there has been a significant change in the
                    estimated stocks of the commodity since the
                    Secretary announced the final terms and
                    conditions of the program for the crop of rice.
      [(f) Inventory Reduction Payments.--
              [(1) In general.--The Secretary may, for each of the
            1991 through 1995 crops of rice, make payments
            available to producers who meet the requirements of
            this subsection.
              [(2) Form.--The payments may be made in the form of
            marketing certificates.
              [(3) Payments.--
                      [(A) In general.--Payments under this
                    subsection shall be determined in the same
                    manner as provided in subsection (b).
                      [(B) Quantity of rice made available.--The
                    quantity of rice to be made available to a
                    producer under this subsection shall be equal
                    in value to the payments so determined under
                    this subsection.
              [(4) Eligibility.--A producer shall be eligible to
            receive a payment under this subsection for a crop if
            the producer--
                      [(A) agrees to forgo obtaining a loan or
                    purchase agreement under subsection (a);
                      [(B) agrees to forgo receiving payments under
                    subsection (c);
                      [(C) does not plant rice for harvest in
                    excess of the crop acreage base reduced by one-
                    half of any acreage required to be diverted
                    from production under subsection (e); and
                      [(D) otherwise complies with this section.
      [(g) Equitable Relief.--
              [(1) Loans and payments.--If the failure of a
            producer to comply fully with the terms and conditions
            of the program conducted under this section precludes
            the making of loans, purchases, and payments, the
            Secretary may, nevertheless, make such loans,
            purchases, and payments in such amounts as the
            Secretary determines are equitable in relation to the
            seriousness of the failure. The Secretary may consider
            whether the producer made a good faith effort to comply
            fully with the terms and conditions of the program in
            determining whether equitable relief is warranted under
            this paragraph.
              [(2) Deadlines and program requirements.--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 program requirements in
            cases in which lateness or failure to meet the other
            requirements does not affect adversely the operation of
            the program.
      [(h) Regulations.--The Secretary may issue such regulations
    as the Secretary determines necessary to carry out this
    section.
      [(i) Commodity Credit Corporation.--The Secretary shall carry
    out the program authorized by this section through the
    Commodity Credit Corporation.
      [(j) 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 under this section.
      [(k) Sharing of Payments.--The Secretary shall provide for
    the sharing of payments made under this section for any farm
    among the producers on the farm on a fair and equitable basis.
      [(l) Tenants and Sharecroppers.--The Secretary shall provide
    adequate safeguards to protect the interests of tenants and
    sharecroppers.
      [(m) Cross-Compliance.--
              [(1) In general.--Compliance on a farm with the terms
            and conditions of any other commodity program, or
            compliance with crop acreage base requirements for any
            other commodity, may not be required as a condition of
            eligibility for loans, purchases, or payments under
            this section.
              [(2) Compliance on other farms.--The Secretary may
            not require producers on a farm, as a condition of
            eligibility for loans, purchases, or payments under
            this section for the farm, to comply with the terms and
            conditions of the rice program with respect to any
            other farm operated by the producers.
      [(n) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through 1995 crops
    of rice.
      [Sec. 103. (a) Notwithstanding the provisions of section 101
    of this Act, price support to cooperators for each crop of
    upland cotton, beginning with the 1961 crop, for which
    producers have not disapproved marketing quotas shall be at
    such level not more than 90 per centum of the parity price
    therefor nor less than the minimum level prescribed below as
    the Secretary determines appropriate after consideration of the
    factors specified in section 401(b) of this Act. For the 1961
    crop the minimum level shall be 70 per centum of the parity
    price therefor, and for each subsequent crop the minimum level
    shall be 65 per centum of the parity price therefore: Provided,
    That the price support for the 1964 crop shall be a national
    average support price which reflects 30 cents per pound for
    Middling one-inch cotton. Price support in the case of
    noncooperators and in case marketing quotas are disapproved
    shall be as provided in section 101(d)(3) and (5).
      [(b)(1) For purposes of this subsection, extra long staple
    cotton means cotton which 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 American 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 such varieties or
    types and which is ginned on a roller-type gin or, if
    authorized by the Secretary, ginned on another type gin for
    experimental purposes.
      [(2) The Secretary shall, upon presentation of warehouse
    receipts reflecting accrued storage charges of not more than
    sixty days, make available to producers nonrecourse loans for a
    term of ten months from the first day of the month in which the
    loan is made at a level which is not less than 85 percent of
    the simple average price received by producers of extra long
    staple cotton, as determined by the Secretary, during 3 years
    of the 5-year period ending July 31 in the year in which the
    loan level is announced, excluding the year in which the
    average price was the highest and the year in which the average
    price was the lowest in such period. If authorized by the
    Secretary, nonrecourse loans provided for in this subsection
    may, upon request of the producer during the tenth month of the
    loan period for the cotton, be made available for an additional
    term of eight months. The loan level for any crop of extra long
    staple cotton shall be determined and announced by the
    Secretary not later than December 1 of the calendar year
    preceding the marketing year for which such loan is to be
    effective and such level shall not thereafter be changed.
      [(3)(A) In addition, payments shall be made for each crop of
    extra long staple cotton to producers on each farm at a rate
    equal to the amount by which the higher of--
              [(i) the average market price received by farmers for
            extra long staple cotton during the first eight months
            of the marketing year for such crop, as determined by
            the Secretary, or
              [(ii) the loan level determined under paragraph (2)
            of this subsection for such crop,
    is less than the established price per pound times, in each
    case, the farm program acreage for extra long staple cotton
    (determined in accordance with paragraph (5)(A), but in no
    event on a greater acreage than the acreage actually planted to
    extra long staple cotton for harvest), multiplied by the farm
    program payment yield for extra long staple cotton (determined
    in accordance with paragraph (4)).
      [(B) Except as provided in clause (ii), the established price
    for each crop of extra long staple cotton shall be 120 per
    centum of the loan level determined for such crop under
    paragraph (2) of this subsection.
      [(ii) In the case of each of the 1988 and 1989 crops of extra
    long staple cotton, the established price for each such crop
    shall be 118.3 percent of the loan level determined for such
    crop under paragraph (2).
      [(C) If the Secretary establishes an acreage limitation
    program for a crop of extra long staple cotton in accordance
    with paragraph (5)(A) and determines that deficiency payments
    will likely be made for such crop of extra long staple cotton
    under subparagraph (A) of this paragraph, the Secretary may
    make available advance deficiency payments for such crop to
    producers who agree to participate in the acreage limitation
    program. Such advance payments shall be made available to
    producers as soon as practicable after the producer files a
    notice of intention to participate in such acreage limitation
    program and in such amount as the Secretary determines
    appropriate to encourage adequate participation in such
    program, except that such amount shall not exceed an amount
    determined by multiplying (i) the estimated farm program
    acreage for the crop, by (ii) the farm program payment yield
    for the crop, by (iii) 50 per centum of the projected payment
    rate, as determined by the Secretary. In any case in which the
    deficiency payment payable to a producer for a crop, as finally
    determined by the Secretary under subparagraph (A) of this
    paragraph, is less than the amount paid to the producer as an
    advance deficiency payment under this paragraph, the producer
    shall refund an amount equal to the difference between the
    amount advanced and the amount finally determined by the
    Secretary to be payable to the producer. If the Secretary
    determines that no deficiency payments are due producers on a
    crop, the producer who received advanced payments on such crop
    shall refund such payments. If a producer fails to comply with
    the requirements under the acreage limitation program after
    obtaining an advance deficiency payment under this paragraph,
    the producer shall immediately repay the amount of the advance,
    plus interest thereon in such amount as the Secretary shall
    prescribe.
      [(4) The farm program payment yield for each crop of extra
    long staple cotton shall be determined on the basis of the
    actual yields per harvested acre on the farm for the preceding
    three years, except that the actual yields shall be adjusted by
    the Secretary for abnormal yields in any year caused by
    drought, flood, or other natural disaster, or other condition
    beyond the control of the producers. In case farm yield data
    for one or more years are unavailable or there was no
    production, the Secretary shall provide for appraisals to be
    made on the basis of actual yields and program payment yields
    for similar farms in the area for which data are available.
    Notwithstanding the foregoing provisions of this paragraph in
    the determination of yields, the Secretary shall take into
    account the actual yields proved by the producer, and neither
    such yields nor the farm program payment yield established on
    the basis of such yields shall be reduced under other
    provisions of this paragraph. If the Secretary determines it
    necessary, the Secretary may establish national, State, or
    county program payment yields on the basis of historical
    yields, as adjusted by the Secretary to correct for abnormal
    factors affecting such yields in the historical period, or, if
    such data are not available, on the Secretary's estimate of
    actual yields for the crop year involved. If national, State,
    or county program payment yields are established, the farm
    program payment yields shall balance to the national, State, or
    county program payment yields.
      [(5)(A)(i) Notwithstanding any other provision of this
    subsection, the Secretary may establish a limitation on the
    acreage planted to extra long staple cotton if the Secretary
    determines that the total supply of extra long staple cotton,
    in the absence of such limitation, will be excessive taking
    into account the need for an adequate carryover to maintain
    reasonable and stable prices and to meet a national emergency.
    Such limitation shall be achieved by applying a uniform
    percentage reduction (including a zero percentage reduction) to
    the acreage base for each extra long staple cotton-producing
    farm. Producers who knowingly produce extra long staple cotton
    in excess of the permitted acreage for the farm shall be
    ineligible for extra long staple cotton loans and payments with
    respect to that farm. The acreage base for any farm for the
    purpose of determining any reduction required to be made for
    any year as a result of a limitation under this subparagraph
    shall be the average acreage planted on the farm to extra long
    staple cotton for harvest in the three crop years immediately
    preceding the year prior to the year for which the
    determination is made. For the purpose of the preceding
    sentence, acreage planted to extra long staple cotton for
    harvest shall include any acreage which the producers were
    prevented from planting to extra long staple cotton or other
    nonconserving crops in lieu of extra long staple cotton because
    of drought, flood, or other natural disaster or other condition
    beyond the control of the producers. The Secretary may make
    adjustments to reflect established crop-rotation practices and
    to reflect such other factors as the Secretary determines
    should be considered in determining a fair and equitable base.
    There is hereby established for the 1984, 1985, and 1986 crops
    an acreage base reserve equal to 5 per centum of the total of
    the farm acreage bases established for the crop under the
    foregoing provisions of this subparagraph. Such reserve shall
    be in addition to the total of the farm acreage bases and shall
    be used by the county committees, in accordance with
    regulations of the Secretary, for making adjustments of farm
    acreage bases to correct inequities and prevent hardship, and
    for establishing bases for farms on which no extra long staple
    cotton was planted during the preceding four years. A number of
    acres on the farm determined by dividing (i) the product
    obtained by multiplying the number of acres required to be
    withdrawn from the production of extra long staple cotton times
    the number of acres actually planted to such commodity, by (ii)
    the number of acres authorized to be planted to such commodity
    under the limitation established by the Secretary, shall be
    devoted to conservation uses, in accordance with regulations
    issued by the Secretary, which will assure protection of such
    acreage from weeds and wind and water erosion. The number of
    acres so determined is hereafter in this subsection referred to
    as ``reduced acreage''. The Secretary may permit, subject to
    such terms and conditions as the Secretary may prescribe, all
    or any part of the reduced acreage to be devoted to sweet
    sorghum, hay and grazing, or the production of guar, sesame,
    safflower, sunflower, castor beans, mustard seed, crambe,
    plantago ovato, flaxseed, triticale, rye, or other commodity,
    if the Secretary determines that such production is needed to
    provide an adequate supply of such commodities, is not likely
    to increase the cost of the price support program, and will not
    affect farm income adversely. The individual farm program
    acreage shall be the actual acreage planted on the farm to
    extra long staple cotton for harvest within the permitted extra
    long staple cotton acreage for the farm as established under
    this paragraph.
        [(ii) Notwithstanding any other provision of this Act, the
    Secretary shall ensure, under such terms and conditions as may
    be prescribed by the Secretary, that the total of the crop
    acreage bases established on a farm which is enrolled in a
    production adjustment program for any commodity shall not be
    increased as a result of the application of the provisions set
    forth in paragraph (13)(C), as extended for the 1989 and 1990
    crop.
      [(B) The Secretary may make land diversion payments to
    producers of extra long staple cotton, whether or not an
    acreage limitation program for extra long staple cotton is in
    effect, if the Secretary determines that such land diversion
    payments are necessary to assist in adjusting the total
    national acreage of extra long staple cotton to desirable
    goals. Such land diversion payments shall be made to producers
    who, to the extent prescribed by the Secretary, devote to
    approved conservation uses an acreage of cropland on the farm
    in accordance with land diversion contracts entered into by the
    Secretary with such producers. The amounts payable to producers
    under land diversion contracts may be determined through the
    submission of bids for such contracts by producers in such
    manner as the Secretary may prescribe or through such other
    means as the Secretary determines appropriate. In determining
    the acceptability of contract offers, the Secretary shall take
    into consideration the extent of the diversion to be undertaken
    by the producers and the productivity of the acreage diverted.
    The Secretary shall limit the total acreage to be diverted
    under agreements in any county or local community so as not to
    affect adversely the economy of the county or local community.
      [(C) The reduced acreage and the diverted acreage may be
    devoted to wildlife food plots or wildlife habitat in
    conformity with standards established by the Secretary in
    consultation with wildlife agencies. The Secretary may pay an
    appropriate share of the cost of practices designed to carry
    out the purpose of the foregoing sentence. The Secretary may
    provide for an additional payment on such acreage in an amount
    determined by the Secretary to be appropriate in relation to
    the benefit to the general public if the producer agrees to
    permit, without other compensation, access to all or such
    portion of the farm, as the Secretary may prescribe, by the
    general public, for hunting, trapping, fishing, and hiking,
    subject to applicable State and Federal regulations.
      [(6) An operator of a farm desiring to participate in the
    program conducted under paragraph (5) shall execute an
    agreement with the Secretary providing for such participation
    not later than such date as the Secretary may prescribe. The
    Secretary may, by mutual agreement with the producers on the
    farm, terminate or modify any such agreement if the Secretary
    determines such action necessary because of an emergency
    created by drought or other disaster or to prevent or alleviate
    a shortage in the supply of agricultural commodities.
      [(7) The Secretary shall provide for the sharing of payments
    made under this subsection for any farm among the producers on
    the farm on a fair and equitable basis.
      [(8) The Secretary shall provide adequate safeguards to
    protect the interests of tenants and sharecroppers.
      [(9) If the failure of a producer to comply fully with the
    terms and conditions of the program formulated under this
    subsection precludes the making of loans and payments, the
    Secretary may, nevertheless, make such loans and payments in
    such amounts as the Secretary determines to be equitable in
    relation to the seriousness of the failure. The Secretary may
    authorize the county and State committees established under
    section 8(b) of the Soil Conservation and Domestic Allotment
    Act to waive or modify deadlines and other program requirements
    in cases in which lateness or failure to meet such other
    requirements does not affect adversely the operation of the
    program.
      [(10) The Secretary may issue such regulations as the
    Secretary determines necessary to carry out the provisions of
    this subsection.
      [(11) The Secretary shall carry out the program authorized by
    this subsection through the Commodity Credit Corporation.
      [(12) The provisions of subsection 8(g) of the Soil
    Conservation and Domestic Allotment Act (relating to assignment
    of payments) shall apply to payments made under this
    subsection.
      [(13)(A) Compliance on a farm with the terms and conditions
    of any other commodity program or compliance with crop acreage
    base requirements for any other commodity may not be required
    as a condition of eligibility for loans or payments under this
    section.
      [(B) The Secretary may not require producers on a farm, as a
    condition of eligibility for loans or payments under this
    section for the farm, to comply with the terms and conditions
    of the extra long staple cotton program with respect to any
    other farm operated by the producers.
      [(14) In order to encourage and assist producers in the
    orderly ginning and marketing of their extra long staple cotton
    production, the Secretary shall make recourse loans available
    to such producers on seed cotton in accordance with authority
    vested in the Secretary under the Commodity Credit Corporation
    Charter Act.
      [(15) References made in sections 402, 403, 406, 407, and 416
    to the terms ``support price'', ``level of support'', and
    ``level of price support'' shall be considered to apply as well
    to the level of loans for extra long staple cotton under this
    subsection; and references to the terms ``price support'',
    ``price support operations'', and ``price support program'' in
    such sections and in section 401(a) shall be considered as
    applying as well to the loan operations for extra long staple
    cotton under this subsection.
      [(16) Notwithstanding any other provision of law, this
    subsection shall not be applicable to the 1996 and subsequent
    crops of extra long staple cotton.

    [SEC. 103B. LOANS, PAYMENTS, AND ACREAGE REDUCTION PROGRAMS FOR THE
                        1991 THROUGH 1997 CROPS OF UPLAND COTTON.

      [(a) Loans.--
              [(1) In general.--Except as otherwise provided in
            this subsection, the Secretary shall, on presentation
            of warehouse receipts or other acceptable evidence of
            title, as determined by the Secretary, reflecting
            accrued storage charges of not more than 60 days, make
            available for the 1991 through 1997 crops of upland
            cotton to producers on a farm nonrecourse loans for
            upland cotton produced on the farm for a term of 10
            months from the first day of the month in which the
            loan is made at such loan level, per pound, as will
            reflect for the base quality of upland cotton, as
            determined by the Secretary, at average location in the
            United States a level that is not less than the smaller
            of--
                      [(A) 85 percent of the average price
                    (weighted by market and month) of the base
                    quality of cotton as quoted in the designated
                    United States spot markets during 3 years of
                    the 5-year period ending July 31 in the year in
                    which the loan level is announced, excluding
                    the year in which the average price was the
                    highest and the year in which the average price
                    was the lowest in the period; or
                      [(B) 90 percent of the average, for the 15-
                    week period beginning July 1 of the year in
                    which the loan level is announced, of the 5
                    lowest-priced growths of the growths quoted for
                    Middling one and three-thirty-seconds inch
                    cotton C.I.F. Northern Europe (adjusted
                    downward by the average difference during the
                    period April 15 through October 15 of the year
                    in which the loan is announced between the
                    average Northern European price quotation of
                    such quality of cotton and the market
                    quotations in the designated United States spot
                    markets for the base quality of upland cotton),
                    as determined by the Secretary.
              [(2) Adjustments to loan level.--
                      [(A) Limitation on decrease in loan level.--
                    The loan level for any crop determined under
                    paragraph (1) may not be reduced by more than 5
                    percent from the level determined for the
                    preceding crop, and may not be reduced below 50
                    cents per pound.
                      [(B) Limitation on increase in loan level.--
                    If for any crop the average Northern European
                    price determined under paragraph (1)(B) is less
                    than the average United States spot market
                    price determined under paragraph (1)(A), the
                    Secretary may increase the loan level to such
                    level as the Secretary may consider
                    appropriate, not in excess of the average
                    United States spot market price determined
                    under paragraph (1)(A).
              [(3) Announcement of loan level.--The loan level for
            any crop of upland cotton shall be determined and
            announced by the Secretary not later than November 1 of
            the calendar year preceding the marketing year for
            which the loan is to be effective or, in the case of
            the 1991 crop, as soon as is practicable after November
            28, 1990. The loan level shall not thereafter be
            changed.
              [(4) Extension of loan period.--
                      [(A) In general.--Except as provided in
                    subparagraph (B), nonrecourse loans provided
                    for in this section shall, on request of the
                    producer during the 10th month of the loan
                    period for the cotton, be made available for an
                    additional term of 8 months.
                      [(B) Limitation.--A request to extend the
                    loan period shall not be approved in any month
                    in which the average price of the base quality
                    of upland cotton, as determined by the
                    Secretary, in the designated spot markets for
                    the preceding month exceeded 130 percent of the
                    average price of such base quality of cotton in
                    the designated United States spot markets for
                    the preceding 36-month period.
              [(5) Marketing loan provisions.--
                      [(A) In general.--If the Secretary determines
                    that the prevailing world market price for
                    upland cotton (adjusted to United States
                    quality and location) is below the loan level
                    determined under the foregoing provisions of
                    this subsection, in order to make United States
                    upland cotton competitive in world markets, the
                    Secretary shall permit a producer to repay a
                    loan made for any crop at--
                              [(i) a level that is the lesser of--
                                      [(I) the loan level
                                    determined for the crop; or
                                      [(II) the higher of--
                                              [(aa) the loan level
                                            determined for the crop
                                            multiplied by 70
                                            percent; or
                                              [(bb) the prevailing
                                            world market price for
                                            upland cotton (adjusted
                                            to United States
                                            quality and location),
                                            as determined by the
                                            Secretary; or
                              [(ii) such other level (not in excess
                            of the loan level determined for the
                            crop nor less than 70 percent of such
                            loan level) that the Secretary
                            determines will--
                                      [(I) minimize potential loan
                                    forfeitures;
                                      [(II) minimize the
                                    accumulation of cotton stocks
                                    by the Federal Government;
                                      [(III) minimize the cost
                                    incurred by the Federal
                                    Government in storing cotton;
                                    and
                                      [(IV) allow cotton produced
                                    in the United States to be
                                    marketed freely and
                                    competitively, both
                                    domestically and
                                    internationally.
                      [(B) First handler marketing certificates.--
                              [(i) In general.--During the period
                            beginning August 1, 1991, and ending
                            July 31, 1998, if a program carried out
                            under subparagraph (A) or subsection
                            (b) fails to make United States upland
                            cotton fully competitive in world
                            markets and the prevailing world market
                            price of upland cotton (adjusted to
                            United States quality and location), as
                            determined by the Secretary, is below
                            the current loan repayment rate for
                            upland cotton determined under
                            subparagraph (A), to make United States
                            upland cotton competitive in world
                            markets and to maintain and expand
                            domestic consumption and exports of
                            upland cotton produced in the United
                            States, the Secretary shall provide for
                            the issuance of marketing certificates
                            or cash payments in accordance with
                            this subparagraph.
                              [(ii) Payments.--The Commodity Credit
                            Corporation, under such regulations as
                            the Secretary may prescribe, shall make
                            payments, through the issuance of
                            marketing certificates or cash
                            payments, to first handlers of cotton
                            (persons regularly engaged in buying or
                            selling upland cotton) who have entered
                            into an agreement with the Commodity
                            Credit Corporation to participate in
                            the program established under this
                            subparagraph. The payments shall be
                            made in such monetary amounts and
                            subject to such terms and conditions as
                            the Secretary determines will make
                            upland cotton produced in the United
                            States available at competitive prices,
                            consistent with the purposes of this
                            subparagraph.
                              [(iii) Value.--The value of each
                            certificate or cash payment issued
                            under clause (ii) shall be based on the
                            difference between--
                                      [(I) the loan repayment rate
                                    for upland cotton; and
                                      [(II) the prevailing world
                                    market price of upland cotton
                                    (adjusted to United States
                                    quality and location), as
                                    determined by the Secretary.
                              [(iv) Redemption, marketing, or
                            exchange.--The Commodity Credit
                            Corporation, under regulations
                            prescribed by the Secretary, may assist
                            any person receiving marketing
                            certificates under this subparagraph in
                            the redemption of certificates for
                            cash, or marketing or exchange of the
                            certificates for agricultural
                            commodities or products owned by the
                            Commodity Credit Corporation, at such
                            times, in such manner, and at such
                            price levels as the Secretary
                            determines will best effectuate the
                            purposes of the program established
                            under this subparagraph. Any price
                            restrictions that may otherwise apply
                            to the disposition of agricultural
                            commodities by the Commodity Credit
                            Corporation shall not apply to the
                            redemption of certificates under this
                            subparagraph.
                              [(v) Designation of commodities and
                            products; charges.--Insofar as
                            practicable, the Secretary shall permit
                            owners of certificates to designate the
                            commodities and the products thereof,
                            including storage sites thereof, the
                            owners would prefer to receive in
                            exchange for certificates. If any
                            certificate is not presented for
                            redemption, marketing, or exchange
                            within a reasonable number of days
                            after the issuance of the certificate
                            (as determined by the Secretary),
                            reasonable costs of storage and other
                            carrying charges, as determined by the
                            Secretary, shall be deducted from the
                            value of the certificate for the period
                            beginning after the reasonable number
                            of days and ending with the date of the
                            presentation of the certificate to the
                            Commodity Credit Corporation.
                              [(vi) Displacement.--The Secretary
                            shall take such measures as may be
                            necessary to prevent the marketing or
                            exchange of agricultural commodities
                            and products for certificates under
                            this subsection from adversely
                            affecting the income of producers of
                            the commodities or products.
                              [(vii) Transfers.--Under regulations
                            prescribed by the Secretary,
                            certificates issued to cotton handlers
                            under this subparagraph may be
                            transferred to other handlers and
                            persons approved by the Secretary.
                      [(C) Prevailing world market price.--
                              [(i) In general.--The Secretary shall
                            prescribe by regulation--
                                      [(I) a formula to define the
                                    prevailing world market price
                                    for upland cotton (adjusted to
                                    United States quality and
                                    location); and
                                      [(II) a mechanism by which
                                    the Secretary shall announce
                                    periodically the prevailing
                                    world market price for upland
                                    cotton (adjusted to United
                                    States quality and location).
                              [(ii) Use.--The prevailing world
                            market price for upland cotton
                            (adjusted to United States quality and
                            location) established under this
                            subparagraph shall be used under
                            subparagraphs (A), (B), and (E).
                      [(D) Adjustment of prevailing world market
                    price.--
                              [(i) In general.--During the period
                            beginning August 1, 1991, and ending
                            July 31, 1998, the prevailing world
                            market price for upland cotton
                            (adjusted to United States quality and
                            location) established under
                            subparagraph (C) shall be further
                            adjusted if--
                                      [(I) the adjusted prevailing
                                    world market price is less than
                                    115 percent of the current crop
                                    year loan level for the base
                                    quality of upland cotton, as
                                    determined by the Secretary;
                                    and
                                      [(II) the Friday through
                                    Thursday average price
                                    quotation for the lowest-priced
                                    United States growth as quoted
                                    for Middling (M) one and three-
                                    thirty seconds inch cotton
                                    delivered C.I.F. Northern
                                    Europe is greater than the
                                    Friday through Thursday average
                                    price of the five lowest-priced
                                    growths of upland cotton, as
                                    quoted for Middling (M) one and
                                    three-thirty seconds inch
                                    cotton, delivered C.I.F.
                                    Northern Europe (hereafter in
                                    this subsection referred to as
                                    the ``Northern Europe price'').
                              [(ii) Further adjustment.--Except as
                            provided in clause (iii), the adjusted
                            prevailing world market price shall be
                            further adjusted on the basis of some
                            or all of the following data, as
                            available:
                                      [(I) The United States share
                                    of world exports.
                                      [(II) The current level of
                                    cotton export sales and cotton
                                    export shipments.
                                      [(III) Other data determined
                                    by the Secretary to be relevant
                                    in establishing an accurate
                                    prevailing world market price
                                    for upland cotton (adjusted to
                                    United States quality and
                                    location).
                              [(iii) Limitation on further
                            adjustment.--The adjustment under
                            clause (ii) may not exceed the
                            difference between--
                                      [(I) the Friday through
                                    Thursday average price for the
                                    lowest-priced United States
                                    growth as quoted for Middling
                                    one and three-thirty seconds
                                    inch cotton delivered C.I.F.
                                    Northern Europe; and
                                      [(II) the Northern Europe
                                    price.
                      [(E) Cotton user marketing certificates.--
                              [(i) Issuance.--Subject to clause
                            (iv), during the period beginning
                            August 1, 1991, and ending July 31,
                            1998, the Secretary shall issue
                            marketing certificates or cash payments
                            to domestic users and exporters for
                            documented purchases by domestic users
                            and sales for export by exporters made
                            in the week following a consecutive 4-
                            week period in which--
                                      [(I) the Friday through
                                    Thursday average price
                                    quotation for the lowest-priced
                                    United States growth, as quoted
                                    for Middling (M) one and three-
                                    thirty seconds inch cotton,
                                    delivered C.I.F. Northern
                                    Europe exceeds the Northern
                                    Europe price by more than 1.25
                                    cents per pound; and
                                      [(II) the prevailing world
                                    market price for upland cotton
                                    (adjusted to United States
                                    quality and location),
                                    established under subparagraph
                                    (C), does not exceed 130
                                    percent of the current crop
                                    year loan level for the base
                                    quality of upland cotton, as
                                    determined by the Secretary.
                              [(ii) Value.--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 such prices during the 4th
                            week of the consecutive 4-week period
                            multiplied by the quantity of upland
                            cotton included in the documented
                            sales.
                              [(iii) Administration.--Clauses (iv)
                            through (vii) of subparagraph (B) shall
                            apply to marketing certificates issued
                            under this subparagraph. Any such
                            certificates may be transferred to
                            other persons in accordance with
                            regulations issued by the Secretary.
                              [(iv) Exception.--The Secretary shall
                            not issue marketing certificates or
                            cash payments under clause (i) if, for
                            the immediately preceding consecutive
                            10-week period, the Friday through
                            Thursday average price quotation for
                            the lowest priced United States growth,
                            as quoted for Middling (M) one and
                            three-thirty seconds inch cotton,
                            delivered C.I.F. Northern Europe,
                            adjusted for the value of any
                            certificate issued under this
                            subparagraph, exceeds the Northern
                            Europe price by more than 1.25 cents
                            per pound.
                      [(F) Special import quota.--
                              [(i) Establishment.--The President
                            shall, within 180 days after the date
                            of enactment of the Uruguay Round
                            Agreements Act, establish an import
                            quota program which shall provide that,
                            during the period beginning August 1991
                            and ending July 31, 1998, whenever the
                            Secretary determines and announces that
                            for any consecutive 10-week period, the
                            Friday through Thursday average price
                            quotation for the lowest-priced United
                            States growth, as quoted for Middling
                            (M) one and three-thirty seconds inch
                            cotton, delivered C.I.F. Northern
                            Europe, adjusted for the value of any
                            certificates issued under subparagraph
                            (E), exceeds the Northern Europe price
                            by more than 1.25 cents per pound,
                            there shall immediately be in effect a
                            special import quota.
                              [(ii) Quantity.--The quota shall be
                            equal to 1 week's consumption of upland
                            cotton by domestic mills at the
                            seasonally adjusted average rate of the
                            most recent 3 months for which data are
                            available.
                              [(iii) Application.--The quota shall
                            apply to upland cotton purchased not
                            later than 90 days after the date of
                            the Secretary's announcement under
                            clause (i) and entered into the United
                            States not later than 180 days after
                            such date.
                              [(iv) Overlap.--A special quota
                            period may be established that overlaps
                            any existing quota period if required
                            by clause (i), except that a special
                            quota period may not be established
                            under this paragraph if a quota period
                            has been established under subsection
                            (n).
                              [(v) Preferential tariff treatment.--
                            The quantity under a special import
                            quota shall be considered to be an in-
                            quota quantity for purposes of section
                            213(d) of the Caribbean Basin Economic
                            Recovery Act (19 U.S.C. 2703(d)),
                            section 204 of the Andean Trade
                            Preference Act (19 U.S.C. 3203),
                            section 503(d) of the Trade Act of 1974
                            (19 U.S.C. 2463(d)), and General Note
                            3(a)(iv) to the HTS.
                              [(vi) Definition.--As used in this
                            subparagraph, 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.
              [(6) Recourse loans for seed cotton.--In order to
            encourage and assist producers in the orderly ginning
            and marketing of their production of upland cotton, the
            Secretary shall make recourse loans available to such
            producers on seed cotton in accordance with authority
            vested in the Secretary under the Commodity Credit
            Corporation Charter Act (15 U.S.C. 714 et seq.).
      [(b) Loan Deficiency Payments.--
              [(1) In general.--The Secretary shall, for each of
            the 1991 through 1997 crops of upland cotton, make
            payments (hereafter in this section referred to as
            ``loan deficiency payments'') available to producers
            who, although eligible to obtain a loan under
            subsection (a), agree to forgo obtaining the loan in
            return for payments under this subsection.
              [(2) Computation.--A payment under this subsection
            shall be computed by multiplying--
                      [(A) the loan payment rate; by
                      [(B) the quantity of upland cotton the
                    producer is eligible to place under loan but
                    for which the producer forgoes obtaining the
                    loan in return for payments under this
                    subsection.
              [(3) Loan payment rate.--For purposes of this
            subsection, the loan payment rate shall be the amount
            by which--
                      [(A) the loan level determined for the crop
                    under subsection (a); exceeds
                      [(B) the level at which a loan may be repaid
                    under subsection (a).
              [(4) Marketing certificates.--The Secretary may make
            up to one-half the amount of a payment under this
            subsection available in the form of marketing
            certificates, subject to the terms and conditions
            provided in subsection (a)(5)(B).
      [(c) Payments.--
              [(1) Deficiency payments.--
                      [(A) In general.--The Secretary shall make
                    available to producers payments (hereafter in
                    this section referred to as ``deficiency
                    payments'') for each of the 1991 through 1997
                    crops of upland cotton in an amount computed by
                    multiplying--
                              [(i) the payment rate; by
                              [(ii) the payment acres for the crop;
                            by
                              [(iii) the farm program payment yield
                            established for the crop for the farm.
                      [(B) Payment rate.--
                              [(i) In general.--The payment rate
                            for upland cotton shall be the amount
                            by which the established price for the
                            crop of upland cotton exceeds the
                            higher of--
                                      [(I) the national average
                                    market price received by
                                    producers during the calendar
                                    year that includes the first 5
                                    months of the marketing year
                                    for the crop, as determined by
                                    the Secretary; or
                                      [(II) the loan level
                                    determined for the crop.
                              [(ii) Minimum established price.--The
                            established price for upland cotton
                            shall not be less than $0.729 per pound
                            for each of the 1991 through 1997
                            crops.
                      [(C) Payment acres.--Payment acres for a crop
                    shall be the lesser of--
                              [(i) the number of acres planted to
                            the crop for harvest within the
                            permitted acreage; or
                              [(ii) 85 percent of the crop acreage
                            base for the crop for the farm less the
                            quantity of reduced acreage (as
                            determined under subsection (e)(2)(D)).
                      [(D) 50/85 program.--
                              [(i) In general.--If an acreage
                            limitation program under subsection
                            (e)(2) is in effect for a crop of
                            upland cotton and the producers on a
                            farm devote a portion of the maximum
                            payment acres for upland cotton as
                            calculated under subparagraph (C)(ii)
                            of the farm equal to more than 8
                            percent for each of the 1991 through
                            1993 crops, and 15 percent for each of
                            the 1994 through 1997 crops (except as
                            provided in clause (v)(II)), of such
                            upland cotton acreage of the farm for
                            the crop to conservation uses (except
                            as provided in subparagraph (E))--
                                      [(I) such portion of the
                                    maximum payment acres in excess
                                    of 8 percent for each of the
                                    1991 through 1993 crops, and 15
                                    percent for each of the 1994
                                    through 1997 crops (except as
                                    provided in clause (v)(II)), of
                                    such acreage devoted to
                                    conservation uses (except as
                                    provided in subparagraph (E))
                                    shall be considered to be
                                    planted to upland cotton for
                                    the purpose of determining the
                                    acreage on the farm required to
                                    be devoted to conservation uses
                                    in accordance with subsection
                                    (e)(2)(D); and
                                      [(II) the producers shall be
                                    eligible for payments under
                                    this paragraph with respect to
                                    such acreage, subject to the
                                    compliance of the producers
                                    with clause (ii).
                              [(ii) Minimum planting requirement.--
                            To be eligible for payments under
                            clause (i), except as provided in
                            clauses (iv) and (v), the producers on
                            a farm must actually plant upland
                            cotton for harvest on at least 50
                            percent of the maximum payment acres
                            for cotton for the farm.
                              [(iii) Deficiency payments.--
                            Notwithstanding any other provision of
                            this section, any producer who devotes
                            a portion of the maximum payment acres
                            for upland cotton for the farm to
                            conservation uses (or other uses as
                            provided in subparagraph (E)) under
                            this subparagraph shall receive
                            deficiency payments on the acreage that
                            is considered to be planted to upland
                            cotton and eligible for payments under
                            this subparagraph for the crop at a
                            per-pound rate established by the
                            Secretary, except that the rate may not
                            be established at less than the
                            projected deficiency payment rate for
                            the crop, as determined by the
                            Secretary. Such projected payment rate
                            for the crop shall be announced by the
                            Secretary prior to the period during
                            which upland cotton producers may agree
                            to participate in the program for the
                            crop.
                              [(iv) Quarantines.--If a State or
                            local agency has imposed in an area of
                            a State or county a quarantine on the
                            planting of upland cotton for harvest
                            on farms in the area, the State
                            committee established under section
                            8(b) of the Soil Conservation and
                            Domestic Allotment Act (16 U.S.C.
                            590h(b)) may recommend to the Secretary
                            that payments be made under this
                            paragraph, without regard to the
                            requirement imposed under clause (ii),
                            to producers in the area who were
                            required to forgo the planting of
                            upland cotton for harvest on acreage to
                            alleviate or eliminate the condition
                            requiring the quarantine. If the
                            Secretary determines that the condition
                            exists, the Secretary may make payments
                            under this paragraph to the producers.
                            To be eligible for payments under this
                            clause, the producers must devote the
                            acreage to conservation uses (except as
                            provided in subparagraph (E)).
                              [(v) Prevented planting and reduced
                            yields.--
                                      [(I) 1991 through 1993
                                    crops.--In the case of each of
                                    the 1991 through 1993 crops of
                                    upland cotton, if an acreage
                                    limitation program under
                                    subsection (e) is in effect for
                                    any crop of upland cotton and
                                    if the Secretary determines
                                    that producers on a farm are
                                    prevented from planting the
                                    acreage intended for upland
                                    cotton to upland cotton because
                                    of drought, flood, or other
                                    natural disaster, or other
                                    condition beyond the control of
                                    the producers, the Secretary
                                    shall make available to such
                                    producers payments under this
                                    subparagraph without regard to
                                    the requirement imposed under
                                    clause (ii). To be eligible for
                                    payments under this clause, the
                                    producers must devote the
                                    acreage to conservation uses
                                    (except as provided in
                                    subparagraph (E)). Any such
                                    acreage shall be considered to
                                    be planted to upland cotton.
                                      [(II) 1994 through 1997
                                    crops.--In the case of each of
                                    the 1994 through 1997 crops of
                                    upland cotton, producers on a
                                    farm shall be eligible to
                                    receive deficiency payments as
                                    provided in clause (iii)
                                    without regard to clause (ii)
                                    if an acreage limitation
                                    program under subsection (e) is
                                    in effect for the crop and--
                                              [(aa) the producers
                                            have been determined by
                                            the Secretary (in
                                            accordance with section
                                            503(c)) to be prevented
                                            from planting the crop
                                            or have incurred a
                                            reduced yield for the
                                            crop (due to a natural
                                            disaster) and the
                                            producers elect to
                                            devote a portion of the
                                            maximum payment acres
                                            for upland cotton (as
                                            calculated under
                                            subparagraph (C)(ii))
                                            equal to more than 8
                                            percent of the upland
                                            cotton acreage, to
                                            conservation uses; or
                                              [(bb) the producers
                                            elect to devote a
                                            portion of the maximum
                                            payment acres for
                                            upland cotton (as
                                            calculated under
                                            subparagraph (C)(ii))
                                            equal to more than 8
                                            percent of the upland
                                            cotton acreage, to
                                            alternative crops as
                                            provided in
                                            subparagraph (E).
                              [(vi) Crop acreage and payment
                            yield.--The upland cotton crop acreage
                            base and upland cotton farm program
                            payment yield of the farm shall not be
                            reduced due to the fact that a portion
                            of the permitted cotton acreage of the
                            farm was devoted to conserving uses
                            (except as provided in subparagraph
                            (E)) under this subparagraph.
                              [(vii) Limitation.--Other than as
                            provided in clauses (i) through (vi),
                            payments may not be made under this
                            paragraph for any crop on a greater
                            acreage than the acreage actually
                            planted to upland cotton.
                              [(viii) Conservation use acreage
                            under other programs.--Any acreage
                            considered to be planted to upland
                            cotton in accordance with clauses (i)
                            and (vi) may not also be designated as
                            conservation use acreage for the
                            purpose of fulfilling any provisions
                            under any acreage limitation or land
                            diversion program requiring that the
                            producers devote a specified acreage to
                            conservation uses.
                              [(ix) Black-eyed peas for donation.--
                            The Secretary may permit, under such
                            terms and conditions as will ensure
                            optimum producer participation, all or
                            any part of the acreage required to be
                            devoted to conservation uses as a
                            condition for qualifying for payments
                            under this subparagraph to be devoted
                            to the production of black-eyed peas
                            if--
                                      [(I) the producer agrees to
                                    donate the harvested peas from
                                    the acreage to a food bank,
                                    food pantry, or soup kitchen
                                    (as defined in paragraphs (3),
                                    (4), and (7) of section 110(b)
                                    of the Hunger Prevention Act of
                                    1988 (7 U.S.C. 612c note)) that
                                    is approved by the Secretary;
                                    and
                                      [(II) the Secretary finds
                                    that such action will not
                                    result in the disruption of
                                    normal channels of trade.
                      [(E) Alternative crops.--
                              [(i) Industrial and other crops.--The
                            Secretary may permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any part of
                            acreage otherwise required to be
                            devoted to conservation uses as a
                            condition of qualifying for payments
                            under subparagraph (D) to be devoted to
                            sweet sorghum, guar, castor beans,
                            plantago ovato, triticale, rye, millet,
                            mung beans, commodities for which no
                            substantial domestic production or
                            market exists but that could yield
                            industrial raw material being imported,
                            or likely to be imported, into the
                            United States, or commodities grown for
                            experimental purposes (including kenaf
                            and milkweed), subject to the following
                            sentence. The Secretary may permit the
                            acreage to be devoted to the production
                            only if the Secretary determines that--
                                      [(I) the production is not
                                    likely to increase the cost of
                                    the price support program; and
                                      [(II) the production is
                                    needed to provide an adequate
                                    supply of the commodity, or, in
                                    the case of commodities for
                                    which no substantial domestic
                                    production or market exists but
                                    that could yield industrial raw
                                    materials, the production is
                                    needed to encourage domestic
                                    manufacture of the raw material
                                    and could lead to increased
                                    industrial use of the raw
                                    material to the long-term
                                    benefit of United States
                                    industry.
                              [(ii) Sesame and crambe.--The
                            Secretary shall permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any part of
                            acreage otherwise required to be
                            devoted to conservation uses as a
                            condition of qualifying for payments
                            under subparagraph (D) to be devoted to
                            sesame and crambe. In implementing this
                            clause, if the Secretary determines
                            that sesame or crambe are considered
                            oilseeds under section 205, the
                            Secretary shall provide that, in order
                            to receive payments under subparagraph
                            (D), the producers shall agree to forgo
                            eligibility to receive a loan under
                            section 205 for the crop of sesame or
                            crambe produced on the farm.
              [(2) Crop insurance requirement.--A producer shall
            obtain catastrophic risk protection insurance coverage
            in accordance with section 427.
      [(d) Payment Yields.--The farm program payment yields for
    farms for each crop of upland cotton shall be determined under
    title V.
      [(e) Acreage Reduction Programs.--
              [(1) In general.--
                      [(A) Establishment.--Notwithstanding any
                    other provision of this Act, if the Secretary
                    determines that the total supply of upland
                    cotton, in the absence of an acreage limitation
                    program, will be excessive taking into account
                    the need for an adequate carry-over to maintain
                    reasonable and stable supplies and prices and
                    to meet a national emergency, the Secretary may
                    provide for any crop of upland cotton an
                    acreage limitation program as described in
                    paragraph (2).
                      [(B) Agricultural resources conservation
                    program.--In making a determination under
                    subparagraph (A), the Secretary shall take into
                    consideration the number of acres placed in the
                    agricultural resources conservation program
                    established under subtitle D of title XII of
                    the Food Security Act of 1985 (16 U.S.C. 3831
                    et seq.).
                      [(C) Announcements.--
                              [(i) Preliminary announcement.--If
                            the Secretary elects to implement an
                            acreage limitation program for any crop
                            year, the Secretary shall make a
                            preliminary announcement of any such
                            program not later than November 1 of
                            the calendar year preceding the year in
                            which the crop is harvested, except
                            that in the case of the 1991 crop, the
                            Secretary shall announce the program as
                            soon as practicable after the date of
                            enactment of this section. The
                            announcement shall include, among other
                            information determined necessary by the
                            Secretary, an announcement of the
                            uniform percentage reduction in the
                            upland cotton crop acreage base
                            described in paragraph (2)(A).
                              [(ii) Final announcement.--Not later
                            than January 1 of the calendar year in
                            which the crop is harvested, the
                            Secretary shall make a final
                            announcement of the program. The
                            announcement shall include, among other
                            information determined necessary by the
                            Secretary, an announcement of the
                            uniform percentage reduction in the
                            upland cotton crop described in
                            paragraph (2)(A).
                              [(iii) Optional programs in early
                            planting areas.--The Secretary shall
                            allow producers in early planting areas
                            to elect to participate in the program
                            on the terms of the acreage limitation
                            program--
                                      [(I) first announced for the
                                    crop under clause (i); or
                                      [(II) as subsequently revised
                                    under clause (ii),
                            if the Secretary determines that the
                            producers may be unfairly disadvantaged
                            by the revision.
                      [(D) Desired carry-over.--The Secretary shall
                    carry out an acreage limitation program
                    described in paragraph (2) for a crop of upland
                    cotton in a manner that will result in a ratio
                    of carry-over to total disappearance of 30
                    percent for each of the 1991 through 1994
                    crops, 29\1/2\ percent for each of the 1995 and
                    1996 crops, and 29 percent for the 1997 crop,
                    based on the Secretary's most recent projection
                    of carry-over and total disappearance at the
                    time of announcement of the acreage limitation
                    program. For the purpose of this subparagraph,
                    the term ``total disappearance'' means all
                    upland cotton utilization, including total
                    domestic, total export, and total residual
                    disappearance.
              [(2) Acreage limitation program.--
                      [(A) Uniform percentage reduction.--Except as
                    provided in paragraph (3), if an upland cotton
                    acreage limitation program is announced under
                    paragraph (1), the limitation shall be achieved
                    by applying a uniform percentage reduction
                    (from 0 to 25 percent) to the upland cotton
                    crop acreage base for the crop for each upland
                    cotton-producing farm.
                      [(B) Compliance.--Except as provided in
                    section 504, producers who knowingly produce
                    upland cotton in excess of the permitted upland
                    cotton acreage for the farm, as established in
                    accordance with subparagraph (A), shall be
                    ineligible for upland cotton loans and payments
                    with respect to that farm.
                      [(C) Crop acreage bases.--Upland cotton crop
                    acreage bases for each crop of upland cotton
                    shall be determined under title V.
                      [(D) Acreage devoted to conservation uses.--A
                    number of acres on the farm shall be devoted to
                    conservation uses, in accordance with
                    regulations issued by the Secretary. Such
                    number shall be determined by multiplying the
                    upland cotton crop acreage base by the
                    percentage reduction required by the Secretary.
                    The number of acres so determined is hereafter
                    in this subsection referred to as ``reduced
                    acreage''. The remaining acreage is hereafter
                    in this subsection referred to as ``permitted
                    acreage''. Permitted acreage may be adjusted by
                    the Secretary as provided in paragraph (3) and
                    in section 504.
                      [(E) Individual farm program acreage.--Except
                    as otherwise provided in subsection (c), the
                    individual farm program acreage shall be the
                    acreage planted on the farm to upland cotton
                    for harvest within the permitted upland cotton
                    acreage for the farm as established under this
                    paragraph.
                      [(F) Planting designated crops on reduced
                    acreage.--
                              [(i) Definition of designated crop.--
                            As used in this subparagraph, the term
                            ``designated crop'' means a crop
                            defined in section 504(b)(1), excluding
                            any program crop as defined in section
                            502(3).
                              [(ii) In general.--Subject to clause
                            (iii), the Secretary may permit
                            producers on a farm to plant a
                            designated crop on no more than one-
                            half of the reduced acreage on the
                            farm.
                              [(iii) Limitations.--If the producers
                            on a farm elect to plant a designated
                            crop on reduced acreage under this
                            subparagraph--
                                      [(I) the amount of the
                                    deficiency payment that the
                                    producers are otherwise
                                    eligible to receive under
                                    subsection (c) shall be
                                    reduced, for each acre (or
                                    portion thereof) that is
                                    planted to the designated crop,
                                    by an amount equal to the
                                    deficiency payment that would
                                    be made with respect to a
                                    number of acres of the crop
                                    that the Secretary considers
                                    appropriate, except that if the
                                    producers on the farm are
                                    participating in a program
                                    established for more than one
                                    program crop, the amount of the
                                    reduction shall be determined
                                    by prorating the reduction
                                    based on the acreage planted or
                                    considered planted on the farm
                                    to all of such program crops;
                                    and
                                      [(II) the Secretary shall
                                    ensure that reductions in
                                    deficiency payments under
                                    subclause (I) are sufficient to
                                    ensure that this subparagraph
                                    will result in no additional
                                    cost to the Commodity Credit
                                    Corporation.
                      [(G) Black-eyed peas for donation.--The
                    Secretary may permit, under such terms and
                    conditions as will ensure optimum producer
                    participation, producers on a farm to plant
                    black-eyed peas on not more than one-half of
                    the reduced acreage on the farm if--
                              [(i) the producer agrees to donate
                            the harvested peas from such acreage to
                            a food bank, food pantry, or soup
                            kitchen (as defined in paragraphs (3),
                            (4), and (7) of section 110(b) of the
                            Hunger Prevention Act of 1988 (7 U.S.C.
                            612c note)) that is approved by the
                            Secretary; and
                              [(ii) the Secretary finds that such
                            action will not result in the
                            disruption of normal channels of trade.
              [(3) Targeted option payments.--
                      [(A) In general.--Notwithstanding any other
                    provision of this section, if the Secretary
                    implements an acreage limitation program with
                    respect to any of the 1991 through 1995 crops
                    of upland cotton, the Secretary may make
                    available to producers on a farm who do not
                    receive payments under subsection (c)(1)(D) for
                    such crop on the farm, adjustments in the level
                    of deficiency payments that would otherwise be
                    made available to the producers if the
                    producers exercise the payment options provided
                    in this paragraph.
                      [(B) Payment options.--If the Secretary
                    elects to carry out this paragraph, the
                    Secretary shall make the payment options
                    specified in subparagraphs (C) and (D)
                    available to producers who agree to make
                    adjustments in the quantity of acreage diverted
                    from the production of upland cotton under an
                    acreage limitation program in accordance with
                    this paragraph.
                      [(C) Increased acreage limitation option.--
                              [(i) Increase in established price.--
                            If the Secretary elects to carry out
                            this paragraph, a producer shall be
                            eligible to receive an increase in the
                            established price for upland cotton
                            under clause (ii) if the producer
                            agrees to an increase in the acreage
                            limitation percentage to be applied to
                            the producers' upland cotton acreage
                            base above the acreage limitation
                            percentage announced by the Secretary.
                              [(ii) Method of calculation.--For the
                            purposes of calculating deficiency
                            payments to be made available to
                            producers who participate in the
                            program under this paragraph, the
                            Secretary shall increase the
                            established price for upland cotton by
                            an amount determined by the Secretary,
                            but not less than 0.5 percent, nor more
                            than 1 percent, for each 1 percentage
                            point increase in the acreage
                            limitation percentage applied to the
                            producers' upland cotton acreage base.
                              [(iii) Limitation.--The acreage
                            limitation percentage to be applied to
                            the producers' upland cotton acreage
                            base shall not be increased by more
                            than 10 percentage points above the
                            acreage limitation percentage announced
                            by the Secretary for the crop or above
                            25 percent total for the crop.
                              [(iv) Adjustment for
                            underplantings.--In determining the
                            increased acreage limitation percentage
                            that is applied to the producer's
                            upland cotton base under this
                            paragraph, the Secretary shall exclude
                            an amount of acreage equal to the
                            average difference between the
                            producer's permitted upland cotton
                            acreage and the acreage actually
                            planted (including acreage devoted to
                            conserving uses under subsection
                            (c)(1)(D)) to upland cotton for harvest
                            during the previous 2 years.
                      [(D) Decreased acreage limitation option.--
                              [(i) Decrease in acreage limitation
                            requirement.--If the Secretary elects
                            to carry out this paragraph, a producer
                            shall be eligible to decrease the
                            acreage limitation percentage
                            applicable to the producers' upland
                            cotton acreage base (as announced by
                            the Secretary) if the producer agrees
                            to a decrease in the established price
                            for upland cotton under clause (ii) for
                            the purpose of calculating deficiency
                            payments to be made available to the
                            producer.
                              [(ii) Method of calculation.--For the
                            purposes of calculating deficiency
                            payments to be made available to
                            producers who choose the option set
                            forth in this subparagraph, the
                            Secretary shall decrease the
                            established price for upland cotton by
                            an amount to be determined by the
                            Secretary, but not less than 0.5
                            percent, nor more than 1 percent, for
                            each 1 percentage point decrease in the
                            acreage limitation percentage applied
                            to the producers' upland cotton acreage
                            base.
                              [(iii) Limitation.--A producer may
                            not choose to decrease the acreage
                            limitation percentage applicable to the
                            producers' upland cotton acreage base
                            under this paragraph by more than one-
                            half of the announced acreage
                            limitation percentage.
                      [(E) Participation and production effects.--
                    Notwithstanding any other provision of this
                    paragraph, the Secretary shall, to the extent
                    practicable, ensure that the program provided
                    for in this paragraph does not have a
                    significant effect on program participation or
                    total production and shall be offered in such a
                    manner that the Secretary determines will
                    result in no additional budget outlays. The
                    Secretary shall provide an analysis of the
                    Secretary's determination to the Committee on
                    Agriculture of the House of Representatives and
                    the Committee on Agriculture, Nutrition, and
                    Forestry of the Senate.
              [(4) Administration.--
                      [(A) Protection from weeds and erosion.--The
                    regulations issued by the Secretary under
                    paragraph (2) with respect to acreage required
                    to be devoted to conservation uses shall assure
                    protection of the acreage from weeds and wind
                    and water erosion.
                      [(B) Annual or perennial cover.--
                              [(i) Required.--
                                      [(I) In general.--Except as
                                    provided in subclause (II) and
                                    paragraph (2), a producer who
                                    participates in an acreage
                                    reduction program established
                                    for a crop of upland cotton
                                    under this subsection shall be
                                    required to plant to, or
                                    maintain as, an annual or
                                    perennial cover 50 percent (or
                                    more at the option of the
                                    producer) of the acreage that
                                    is required to be removed from
                                    the production of upland
                                    cotton, but not to exceed 5
                                    percent (or more at the option
                                    of the producer) of the crop
                                    acreage base established for
                                    the crop.
                                      [(II) Arid areas.--Subclause
                                    (I) shall not apply with
                                    respect to arid areas
                                    (including summer fallow
                                    areas), as determined by the
                                    Secretary. If the Secretary
                                    determines any county in a
                                    State to be arid, the
                                    respective State committee
                                    established under section 8(b)
                                    of the Soil Conservation and
                                    Domestic Allotment Act (16
                                    U.S.C. 590h(b)) may designate
                                    any other county or counties or
                                    all of the State as arid for
                                    the purposes of this paragraph.
                                      [(III) Approval of cover
                                    crops and practices.--The State
                                    committee, after receiving
                                    recommendations from the county
                                    committees, shall approve
                                    appropriate crops planted or
                                    maintained as cover, including,
                                    as appropriate, annual or
                                    perennial native grasses and
                                    legumes or other vegetation.
                                    The State committee shall
                                    establish the final seeding
                                    date for the planting of the
                                    cover and shall approve
                                    appropriate cover crops or
                                    practices, after consulting the
                                    Soil Conservation Service State
                                    Conservationist regarding
                                    whether the crops or practices
                                    will sufficiently protect the
                                    land from weeds and wind and
                                    water erosion. After the
                                    Secretary establishes the State
                                    technical committee for the
                                    State pursuant to section 1261
                                    of the Food Security Act of
                                    1985 (16 U.S.C. 3861), the
                                    State committee shall consult
                                    with the technical committee
                                    (rather than the Soil
                                    Conservation Service State
                                    Conservationist) regarding
                                    whether the crops or practices
                                    will sufficiently protect the
                                    land from weeds and wind and
                                    water erosion.
                              [(ii) Multiyear program.--
                                      [(I) Cost-share assistance.--
                                    If a producer elects to
                                    establish a perennial cover
                                    capable of improving water
                                    quality or wildlife habitat on
                                    the acreage, the Commodity
                                    Credit Corporation shall make
                                    available cost-share assistance
                                    for 25 percent of the approved
                                    cost of establishing the cover
                                    on not more than 50 percent of
                                    the acreage that is required to
                                    be diverted from production,
                                    but not to exceed 5 percent (or
                                    more, at the option of the
                                    producer) of the crop acreage
                                    base established for a crop.
                                      [(II) Agreement of
                                    producer.--If a producer elects
                                    to establish a perennial cover
                                    on the acreage under this
                                    subparagraph and receives cost-
                                    share assistance from the
                                    Corporation with respect to the
                                    cover, the producer, under such
                                    terms and conditions as may be
                                    prescribed by the Secretary,
                                    taking into consideration
                                    guidelines established by the
                                    State technical committees
                                    established in subtitle G of
                                    title XII of the Food Security
                                    Act of 1985, shall agree to
                                    maintain the perennial cover
                                    for a minimum of 3 years.
                              [(iii) Conserving crops.--The
                            Secretary may permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any part of the
                            acreage to be devoted to sweet sorghum,
                            guar, sesame, castor beans, crambe,
                            plantago ovato, triticale, rye, mung
                            beans, milkweed, or other commodity, if
                            the Secretary determines that the
                            production is needed to provide an
                            adequate supply of the commodities, is
                            not likely to increase the cost of the
                            price support program, and will not
                            affect farm income adversely.
                      [(C) Haying and grazing.--
                              [(i) In general.--Except as provided
                            in clause (ii), haying and grazing of
                            reduced acreage, acreage devoted to a
                            conservation use under subsection
                            (c)(1)(D), and acreage diverted from
                            production under a land diversion
                            program established under this section
                            shall be permitted, except during any
                            consecutive 5-month period that is
                            established by the State committee
                            established under section 8(b) of the
                            Soil Conservation and Domestic
                            Allotment Act (16 U.S.C. 590h(b)) for a
                            State. The 5-month period shall be
                            established during the period beginning
                            April 1, and ending October 31, of a
                            year.
                              [(ii) Natural disasters.--In the case
                            of a natural disaster, the Secretary
                            may permit unlimited haying and grazing
                            on the acreage. The Secretary may not
                            exclude irrigated or irrigable acreage
                            not planted in alfalfa when exercising
                            the authority under this clause.
                      [(D) Water storage uses.--
                              [(i) In general.--The regulations
                            issued by the Secretary under paragraph
                            (2) with respect to acreage required to
                            be devoted to conservation uses shall
                            provide that land that has been
                            converted to water storage uses shall
                            be considered to be devoted to
                            conservation uses if the land was
                            devoted to wheat, feed grains, cotton,
                            rice, or oilseeds in at least 3 of the
                            immediately preceding 5 years. The land
                            shall be considered to be devoted to
                            conservation uses for the period that
                            the land remains in water storage uses,
                            but not to exceed 5 years subsequent to
                            its conversion to water storage uses.
                              [(ii) Limitations.--Land converted to
                            water storage uses for the purposes of
                            this subparagraph may not be devoted to
                            any commercial use, including
                            commercial fish production. The water
                            stored on the land may not be ground
                            water. The farm on which the land is
                            located must have been irrigated with
                            ground water during at least 1 of the
                            preceding 5 crop years.
              [(5) Land diversion program.--
                      [(A) Payments.--
                              [(i) In general.--The Secretary may
                            make land diversion payments to
                            producers of upland cotton, whether or
                            not an acreage limitation program for
                            upland cotton is in effect, if the
                            Secretary determines that the land
                            diversion payments are necessary to
                            assist in adjusting the total national
                            acreage of upland cotton to desirable
                            goals. The land diversion payments
                            shall be made to producers who, to the
                            extent prescribed by the Secretary,
                            devote to approved conservation uses an
                            acreage of cropland on the farm in
                            accordance with land diversion
                            contracts entered into by the Secretary
                            with the producers.
                              [(ii) Excess carry-over.--If, at the
                            time of final announcement of the
                            acreage limitation program established
                            under this subsection, the projected
                            carry-over of upland cotton for the
                            crop year is equal to or greater than 8
                            million bales, the Secretary shall
                            offer a paid land diversion program to
                            producers of upland cotton. Payments to
                            producers under such a program shall be
                            determined by multiplying--
                                      [(I) the payment rate, of not
                                    less than 35 cents per pound of
                                    cotton, established by the
                                    Secretary; by
                                      [(II) the program payment
                                    yield established for the crop
                                    for the farm; by
                                      [(III) the number of
                                    permitted upland cotton acres
                                    diverted on the farm.
                      [(B) Bids for contracts.--The amounts payable
                    to producers under land diversion contracts may
                    be determined through the submission of bids
                    for the contracts by producers in such manner
                    as the Secretary may prescribe or through such
                    other means as the Secretary determines
                    appropriate. In determining the acceptability
                    of contract offers, the Secretary shall take
                    into consideration the extent of the diversion
                    to be undertaken by the producers and the
                    productivity of the acreage diverted.
                      [(C) Limitations on diverted acreage.--
                              [(i) Maximum acreage per farm,
                            county, or community.--The Secretary
                            shall limit the total acreage to be
                            diverted under this paragraph--
                                      [(I) to not more than 15
                                    percent of the upland cotton
                                    crop acreage base for a farm;
                                    and
                                      [(II) under agreements in any
                                    county or local community so as
                                    not to affect adversely the
                                    economy of the county or local
                                    community.
                              [(ii) Lower participation levels.--
                            The Secretary may allow producers to
                            participate in a land diversion program
                            under this paragraph at a level lower
                            than the maximum level announced by the
                            Secretary, at the option of the
                            producer, if the Secretary determines
                            that it will increase participation in
                            the program.
              [(6) Conservation practices.--
                      [(A) Wildlife food plots or habitat.--The
                    reduced acreage and additional diverted acreage
                    may be devoted to wildlife food plots or
                    wildlife habitat in conformity with standards
                    established by the Secretary in consultation
                    with wildlife agencies. The Secretary may pay
                    an appropriate share of the cost of practices
                    designed to carry out the purposes of this
                    subparagraph.
                      [(B) Public access.--The Secretary may
                    provide for an additional payment on the
                    acreage in an amount determined by the
                    Secretary to be appropriate in relation to the
                    benefit to the general public if the producer
                    agrees to permit, without other compensation,
                    access to all or such portion of the farm, as
                    the Secretary may prescribe, by the general
                    public, for hunting, trapping, fishing, and
                    hiking, subject to applicable State and Federal
                    regulations.
              [(7) Participation agreements.--
                      [(A) In general.--Producers on a farm
                    desiring to participate in the program
                    conducted under this subsection shall execute
                    an agreement with the Secretary providing for
                    the participation not later than such date as
                    the Secretary may prescribe.
                      [(B) Modification or termination.--The
                    Secretary may, by mutual agreement with
                    producers on a farm, modify or terminate any
                    such agreement if the Secretary determines the
                    action necessary because of an emergency
                    created by drought or other disaster or to
                    prevent or alleviate a shortage in the supply
                    of agricultural commodities. The Secretary may
                    modify the agreement under this subparagraph
                    for the purpose of alleviating a shortage in
                    the supply of agricultural commodities only if
                    there has been a significant change in the
                    estimated stocks of the commodity since the
                    Secretary announced the final terms and
                    conditions of the program for the crop of
                    upland cotton.
      [(f) Inventory Reduction Payments.--
              [(1) In general.--The Secretary may, for each of the
            1991 through 1995 crops of upland cotton, make payments
            available to producers who meet the requirements of
            this subsection.
              [(2) Form.--The payments may be made in the form of
            marketing certificates.
              [(3) Payments.--
                      [(A) In general.--Payments under this
                    subsection shall be determined in the same
                    manner as provided in subsection (b).
                      [(B) Quantity of cotton made available.--The
                    quantity of upland cotton to be made available
                    to a producer under this subsection shall be
                    equal in value to the payments so determined
                    under this subsection.
              [(4) Eligibility.--A producer shall be eligible to
            receive a payment under this subsection for a crop if
            the producer--
                      [(A) agrees to forgo obtaining a loan under
                    subsection (a);
                      [(B) agrees to forgo receiving payments under
                    subsection (c);
                      [(C) does not plant upland cotton for harvest
                    in excess of the crop acreage base reduced by
                    one-half of any acreage required to be diverted
                    from production under subsection (e); and
                      [(D) otherwise complies with this section.
      [(g) Equitable Relief.--
              [(1) Loans and payments.--If the failure of a
            producer to comply fully with the terms and conditions
            of the program conducted under this section precludes
            the making of loans and payments, the Secretary may,
            nevertheless, make such loans and payments in such
            amounts as the Secretary determines are equitable in
            relation to the seriousness of the failure. The
            Secretary may consider whether the producer made a good
            faith effort to comply fully with the terms and
            conditions of the program in determining whether
            equitable relief is warranted under this paragraph.
              [(2) Deadlines and program requirements.--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 program requirements in
            cases in which lateness or failure to meet such other
            requirements does not affect adversely the operation of
            the program.
      [(h) Regulations.--The Secretary may issue such regulations
    as the Secretary determines necessary to carry out this
    section.
      [(i) Commodity Credit Corporation.--The Secretary shall carry
    out the program authorized by this section through the
    Commodity Credit Corporation.
      [(j) 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 under this section.
      [(k) Sharing of Payments.--The Secretary shall provide for
    the sharing of payments made under this section for any farm
    among the producers on the farm on a fair and equitable basis.
      [(l) Tenants and Sharecroppers.--The Secretary shall provide
    adequate safeguards to protect the interests of tenants and
    sharecroppers.
      [(m) Cross-Compliance.--
              [(1) In general.--Compliance on a farm with the terms
            and conditions of any other commodity program, or
            compliance with crop acreage base requirements for any
            other commodity, may not be required as a condition of
            eligibility for loans or payments under this section.
              [(2) Compliance on other farms.--The Secretary may
            not require producers on a farm, as a condition of
            eligibility for loans or payments under this section
            for the farm, to comply with the terms and conditions
            of the upland cotton program with respect to any other
            farm operated by the producers.
      [(n) Limited Global Import Quota.--
              [(1) In general.--The President shall, within 180
            days after the date of enactment of the Uruguay Round
            Agreements Act, establish an import quota program which
            shall provide 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 such 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 as set forth in
                    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 section 213(d) of the Caribbean
                    Basin Economic Recovery Act (19 U.S.C.
                    2703(d)), section 204 of the Andean Trade
                    Preference Act (19 U.S.C. 3203), section 503(d)
                    of the Trade Act of 1974 (19 U.S.C. 2463(d)),
                    and General Note 3(a)(iv) to the HTS.
                      [(D) Definitions.--As used in subparagraph
                    (B):
                              [(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; plus
                                      [(II) production of the
                                    current crop; plus
                                      [(III) imports to the latest
                                    date available during the
                                    marketing year.
                              [(ii) Demand.--The term ``demand''
                            means--
                                      [(I) the average seasonally
                                    adjusted annual rate of
                                    domestic mill consumption in
                                    the most recent 3 months for
                                    which data are available; plus
                                      [(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.--
                            As used in this subsection, 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.
                      [(D) 103B-47 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 (a)(5)(F).
      [(o) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through 1997 crops
    of upland cotton.
      [Sec. 104.
      [(c) The Secretary of Agriculture is hereby authorized and
    directed to conduct a special cotton research program designed
    to reduce the cost of producing upland cotton in the United
    States at the earliest practicable date. There are hereby
    authorized to be appropriated such sums, not to exceed
    $10,000,000 annually, as may be necessary for the Secretary to
    carry out this special research program. The Secretary shall
    report annually to the Committee on Agriculture of the House of
    Representatives and to the Committee on Agriculture, Nutrition,
    and Forestry of the Senate with respect to the results of such
    research.
      [(d) In order to reduce cotton production costs, to prevent
    the movement of certain cotton plant insects to areas not now
    infested, and to enhance the quality of the environment, the
    Secretary is authorized and directed to carry out programs to
    destroy and eliminate cotton boll weevils in infested areas of
    the United States as provided herein and to carry out similar
    programs with respect to pink bollworms or any other major
    cotton insect if the Secretary determines that methods and
    systems have been developed to the point that success in
    eradication of such insects is assured. The Secretary shall
    carry out the eradication programs authorized by this
    subsection through the Commodity Credit Corporation. In
    carrying out insect eradication projects, the Secretary shall
    utilize the technical and related services of appropriate
    Federal, State, private agencies, and cotton organizations.
    Producers and landowners in an eradication zone, established by
    the Secretary, who are receiving benefits from any program
    administered by the United States Department of Agriculture,
    shall, as a condition of receiving or continuing any such
    benefits, participate in and cooperate with the eradication
    project, as specified in regulations of the Secretary.
      [The Secretary may issue such regulations as he deems
    necessary to enforce the provisions of this subsection with
    respect to achieving the compliance of producers and landowners
    who are not receiving benefits from any program administered by
    the United States Department of Agriculture. Any person who
    knowingly violates any such regulation promulgated by the
    Secretary under this subsection may be assessed a civil penalty
    of not to exceed $5,000 for each offense. No civil penalty
    shall be assessed unless the person shall have been given
    notice and opportunity for a hearing on such charge in the
    county, parish, or incorporated city of the residence of the
    person charged. In determining the amount of the penalty the
    Secretary shall consider the appropriateness of such penalty to
    the size of the business of the person charged, the effect on
    the person's ability to continue in business, and the gravity
    of the violation. Where special measures deemed essential to
    achievement of the eradication objective are taken by the
    project and result in a loss of production and income to the
    producer, the Secretary shall provide reasonable and equitable
    indemnification from funds available for the project, and also
    provide for appropriate protection of the allotment, acreage
    history, and average yield for the farm. The cost of the
    program in each eradication zone shall be determined, and
    cotton producers in the zone shall be required to pay up to
    one-half thereof, with the exact share in each zone area to be
    specified by the Secretary upon his finding that such share is
    reasonable and equitable based on population levels of the
    target insect and the degree of control measures normally
    required. Each producer's pro rata share shall be deducted from
    his cotton payment under this Act or otherwise collected, as
    provided in regulations of the Secretary. Insofar as
    practicable, cotton producers and other persons engaged in
    cotton production in the eradication zone shall be employed to
    participate in the work of the project in such zone. Funding of
    the program shall be terminated at such time as the Secretary
    determines and reports to the Congress that complete
    eradication of the insects for which programs are undertaken
    pursuant to this subsection has been accomplished. Funds in
    custody of agencies carrying out the program shall, upon
    termination of such program, be accounted for to the Secretary
    for appropriate disposition.
      [The Secretary is authorized to cooperate with the Government
    of Mexico in carrying out operations or measures in Mexico
    which he deems necessary and feasible to prevent the movement
    into the United States from Mexico of any insects eradicated
    under the provisions of this subsection. The measure and
    character of cooperation carried out under this subsection on
    the part of the United States and on the part of the Government
    of Mexico, including the expenditure or use of funds made
    available by the Secretary under this subsection, shall be such
    as may be prescribed by the Secretary. Arrangements for the
    cooperation authorized by this subsection shall be made through
    and in consultation with the Secretary of State. The Commodity
    Credit Corporation shall not make any expenditures for carrying
    out the purposes of this subsection unless the Corporation has
    received funds to cover such expenditures from appropriations
    made to carry out the purposes of this subsection. There are
    hereby authorized to be appropriated to the Commodity Credit
    Corporation such sums as the Congress may from time to time
    determine to be necessary to carry out the purposes of this
    subsection.
      [Sec. 105. (a) Notwithstanding the provisions of section 101
    of this Act, beginning with the 1964 crop, price support shall
    be made available to producers for each crop of corn at such
    level, not less than 50 per centum or more than 90 per centum
    of the parity price therefor, as the Secretary determines will
    not result in increasing Commodity Credit Corporation stocks of
    corn: Provided, That in the case of any crop for which an
    acreage diversion program is in effect for any crop for which
    an acreage diversion program is in effect for feed grains, the
    level of price support for corn of such crop shall be at such
    level not less than 65 per centum or more than 90 per centum of
    the parity price therefor as the Secretary determines necessary
    to achieve the acreage reduction goal established by him for
    the crop.
      [(b) Beginning with the 1959 crop, price support shall be
    made available to producers for each crop of oats, rye, barley,
    and grain sorghums at such level of the parity price therefor
    as the Secretary of Agriculture determines is fair and
    reasonable in relation to the level at which price support is
    made available for corn, taking into consideration the feeding
    value of such commodity in relation to corn, and the other
    factors set forth in section 401(b) hereof.

    [SEC. 105B. LOANS, PAYMENTS, AND ACREAGE REDUCTION PROGRAMS FOR THE
                        1991 THROUGH 1995 CROPS OF FEED GRAINS.

      [(a) Loans and Purchases.--
              [(1) In general.--Except as otherwise provided in
            this subsection, the Secretary shall make available to
            producers on a farm loans and purchases for each of the
            1991 through 1995 crops of corn produced on the farm at
            such level as the Secretary determines will encourage
            the exportation of feed grains and not result in
            excessive total stocks of feed grains after taking into
            consideration the cost of producing corn, supply and
            demand conditions, and world prices for corn.
              [(2) Minimum loan and purchase level.--Except as
            provided in paragraphs (3) and (4), the loan and
            purchase level determined under paragraph (1) shall not
            be less than 85 percent of the simple average price
            received by producers of corn, as determined by the
            Secretary, during the marketing years for the
            immediately preceding 5 crops of corn, excluding the
            year in which the average price was the highest and the
            year in which the average price was the lowest in such
            period, except that the loan and purchase level for a
            crop determined under this paragraph may not be reduced
            by more than 5 percent from the level determined for
            the preceding crop.
              [(3) Adjustments to support level.--
                      [(A) Stocks to use ratio.-- If the Secretary
                    estimates for any marketing year that the ratio
                    of ending stocks of corn to total use for the
                    marketing year will be--
                              [(i) equal to or greater than 25
                            percent, the Secretary may reduce the
                            loan and purchase level for corn for
                            the corresponding crop by an amount not
                            to exceed 10 percent in any year;
                              [(ii) less than 25 percent but not
                            less than 12.5 percent, the Secretary
                            may reduce the loan and purchase level
                            for corn for the corresponding crop by
                            an amount not to exceed 5 percent in
                            any year; or
                              [(iii) less than 12.5 percent the
                            Secretary may not reduce the loan and
                            purchase level for corn for the
                            corresponding crop.
                      [(B) Report to congress.--
                              [(i) In general.--If the Secretary
                            adjusts the level of loans and
                            purchases for corn under subparagraph
                            (A), 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--
                                      [(I) certifying such
                                    adjustment as necessary to
                                    prevent the accumulation of
                                    stocks and to retain market
                                    share; and
                                      [(II) containing a
                                    description of the need for
                                    such adjustment.
                              [(ii) Effective date of adjustment.--
                            The adjustment shall become effective
                            no earlier than 60 calendar days after
                            the date of submission of the report to
                            the Committees, except that in the case
                            of the 1991 crop of feed grains, the
                            adjustment shall become effective on
                            the date of the submission of the
                            report.
                      [(C) Competitive position.--Notwithstanding
                    subparagraph (A), if the Secretary determines,
                    not later than 60 days prior to the beginning
                    of a marketing year for a crop, that the
                    effective loan rate established for such crop
                    will not maintain a competitive market position
                    for corn, the Secretary may reduce the loan and
                    purchase level for corn for the marketing year
                    by an amount, in addition to any reduction
                    under subparagraph (A), not to exceed 10
                    percent in any year.
                      [(D) No effect on future years.--Any
                    reduction in the loan and purchase level for
                    corn under this paragraph shall not be
                    considered in determining the loan and purchase
                    level for corn for subsequent years.
                      [(E) Minimum loan rate.--Notwithstanding
                    subparagraph (A), the loan rate for corn shall
                    not be less than $1.76 per bushel, unless such
                    rate would exceed 80 percent of the 5-year
                    average market price determination.
              [(4) Marketing loan provisions.--
                      [(A) In general.--The Secretary may permit a
                    producer to repay a loan made under this
                    subsection for a crop at a level (except as
                    provided in subparagraph (C)) that is the
                    lesser of--
                              [(i) the loan level determined for
                            the crop;
                              [(ii) the higher of--
                                      [(I) 70 percent of such
                                    level;
                                      [(II) if the loan level for a
                                    crop was reduced under
                                    paragraph (3), 70 percent of
                                    the loan level that would have
                                    been in effect but for the
                                    reduction under paragraph (3);
                                    or
                              [(iii) the prevailing world market
                            price for feed grains (adjusted to
                            United States quality and location), as
                            determined by the Secretary.
                      [(B) Prevailing world market price.--If the
                    Secretary permits a producer to repay a loan in
                    accordance with subparagraph (A), the Secretary
                    shall prescribe by regulation--
                              [(i) a formula to determine the
                            prevailing world market price for feed
                            grains, adjusted to United States
                            quality and location; and
                              [(ii) a mechanism by which the
                            Secretary shall announce periodically
                            the prevailing world market price for
                            feed grains.
                      [(C) Alternative repayment rates.--For each
                    of the 1991 through 1995 crops of feed grains,
                    if the world market price for feed grains
                    (adjusted to United States quality and
                    location) as determined by the Secretary, is
                    less than the loan level determined for the
                    crop, the Secretary may permit a producer to
                    repay a loan made under this subsection for a
                    crop at such level (not in excess of the loan
                    level determined for the crop) as the Secretary
                    determines will--
                              [(i) minimize potential loan
                            forfeitures;
                              [(ii) minimize the accumulation of
                            feed grain stocks by the Federal
                            Government;
                              [(iii) minimize the cost incurred by
                            the Federal Government in storing feed
                            grains; and
                              [(iv) allow feed grains produced in
                            the United States to be marketed freely
                            and competitively, both domestically
                            and internationally.
              [(5) Simple average price.--For purposes of this
            section, the simple average price received by producers
            for the immediately preceding marketing year shall be
            based on the latest information available to the
            Secretary at the time of the determination.
              [(6) Other feed grains.--The Secretary shall make
            available to producers loans and purchases for each of
            the 1991 through 1995 crops of grain sorghums, barley,
            oats, and rye, respectively, produced on the farm at
            such level as the Secretary determines is fair and
            reasonable in relation to the level that loans and
            purchases are made available for corn, taking into
            consideration the feeding value of the commodity in
            relation to corn and other factors specified in section
            401(b).
      [(b) Loan Deficiency Payments.--
              [(1) In general.--The Secretary may, for each of the
            1991 through 1995 crops of feed grains, make payments
            (hereafter in this section referred to as ``loan
            deficiency payments'') available to producers who,
            although eligible to obtain a loan or purchase
            agreement under subsection (a), agree to forgo
            obtaining the loan or agreement in return for payments
            under this subsection.
              [(2) Computation.--A payment under this subsection
            shall be computed by multiplying--
                      [(A) the loan payment rate; by
                      [(B) the quantity of feed grains the producer
                    is eligible to place under loan (or obtain a
                    purchase agreement) but for which the producer
                    forgoes obtaining the loan or agreement in
                    return for payments under this subsection.
              [(3) Loan payment rate.--For purposes of this
            subsection, the loan payment rate shall be the amount
            by which--
                      [(A) the loan level determined for the crop
                    under subsection (a); exceeds
                      [(B) the level at which a loan may be repaid
                    under subsection (a).
      [(c) Payments.--
              [(1) Deficiency payments.--
                      [(A) In general.--The Secretary shall make
                    available to producers payments (hereafter in
                    this section referred to as ``deficiency
                    payments'') for each of the 1991 through 1995
                    crops of corn, grain sorghums, oats, and
                    barley, in an amount computed by multiplying--
                              [(i) the payment rate; by
                              [(ii) the payment acres for the crop;
                            by
                              [(iii) the farm program payment yield
                            established for the crop for the farm.
                      [(B) Payment rate.--
                              [(i) Payment rate for 1991 through
                            1993 crops.--The payment rate for each
                            of the 1991 through 1993 crops of corn,
                            grain sorghums, oats, and barley shall
                            be the amount by which the established
                            price for the respective crop of feed
                            grains exceeds the higher of--
                                      [(I) the national weighted
                                    average market price received
                                    by producers during the first 5
                                    months of the marketing year
                                    for the crop, as determined by
                                    the Secretary; or
                                      [(II) the loan level
                                    determined for the crop, prior
                                    to any adjustment made under
                                    subsection (a)(3) for the
                                    marketing year for the crop.
                              [(ii) Payment rate of 1994 and 1995
                            crops.--The payment rate for each of
                            the 1994 and 1995 crops of corn, grain
                            sorghums, oats, and barley shall be the
                            amount by which the established price
                            for the respective crop of feed grains
                            exceeds the higher of--
                                      [(I) the lesser of--
                                              [(aa) the national
                                            weighted average market
                                            price received by
                                            producers during the
                                            marketing year for the
                                            crop, as determined by
                                            the Secretary; or
                                              [(bb) the national
                                            weighted average market
                                            price received by
                                            producers during the
                                            first 5 months of the
                                            marketing year for the
                                            crop, as determined by
                                            the Secretary, plus 7
                                            cents per bushel; or
                                      [(II) the loan level
                                    determined for the crop, prior
                                    to any adjustment made under
                                    subsection (a)(3) for the
                                    marketing year for the
                                    respective crop of feed grains.
                              [(iii) Minimum established prices.--
                                      [(I) Corn.--The established
                                    price for corn shall not be
                                    less than $2.75 per bushel for
                                    each of the 1991 through 1995
                                    crops of corn.
                                      [(II) Oats.--The established
                                    price for oats shall be such
                                    price as the Secretary
                                    determines is fair and
                                    reasonable in relation to the
                                    established price for corn, but
                                    not less than $1.45 per bushel.
                                      [(III) Grain sorghums.--The
                                    established price for each of
                                    the 1991 through 1995 crops of
                                    grain sorghums shall not be
                                    less than $2.61 per bushel.
                                      [(IV) Barley.--
                                              [(aa) In general.--
                                            The established price
                                            for barley shall be
                                            such price as the
                                            Secretary determines is
                                            fair and reasonable in
                                            relation to the
                                            established price for
                                            corn, taking into
                                            consideration the
                                            various feed and food
                                            uses for barley. The
                                            established price for
                                            barley shall not be
                                            less than 85.8 percent
                                            of the established
                                            price for corn.
                                              [(bb) Barley
                                            calculations.--The
                                            Secretary shall, for
                                            purposes of determining
                                            the payment rate for
                                            barley under clauses
                                            (i) and (ii) and
                                            subparagraph (D)(ii),
                                            use the national
                                            weighted average market
                                            price received by
                                            producers of barley
                                            sold primarily for feed
                                            purposes.
                                              [(cc) Advance
                                            payments.--In the case
                                            of the 1991 crop of
                                            barley, the Secretary
                                            shall, for purposes of
                                            determining any advance
                                            deficiency payment made
                                            to the producers of
                                            barley under section
                                            114, use the national
                                            weighted average market
                                            price received by
                                            producers for all
                                            barley, as determined
                                            by the Secretary.
                                              [(dd) Equity.--In
                                            implementing this
                                            subsection, the
                                            Secretary shall make
                                            available to producers
                                            of the 1991 crop of
                                            barley, notwithstanding
                                            the method of
                                            calculation or the
                                            amount of the advance
                                            deficiency payment, the
                                            total amount of
                                            payments as calculated
                                            under clause (bb).
                      [(C) Payment acres.--Payment acres for a crop
                    shall be the lesser of--
                              [(i) the number of acres planted to
                            the crop for harvest within the
                            permitted acreage; or
                              [(ii) 85 percent of the crop acreage
                            base for the crop for the farm less the
                            quantity of reduced acreage (as
                            determined under subsection (e)(2)(D)).
                      [(D) Emergency compensation.--
                              [(i) In general.--Notwithstanding the
                            foregoing provisions of this section,
                            if the Secretary adjusts the level of
                            loans and purchases for feed grains
                            under subsection (a)(3), the Secretary
                            shall provide emergency compensation by
                            increasing the deficiency payments for
                            feed grains by such amount as the
                            Secretary determines necessary to
                            provide the same total return to
                            producers as if the adjustment in the
                            level of loans and purchases had not
                            been made.
                              [(ii) Calculation.--In determining
                            the payment rate, per bushel, for
                            emergency compensation payments for a
                            crop of feed grains under this
                            subparagraph, the Secretary shall use
                            the national weighted average market
                            price, per bushel of feed grains,
                            received by producers during the
                            marketing year for the crop, as
                            determined by the Secretary.
                      [(E) 0/85 program.--
                              [(i) In general.--If an acreage
                            limitation program under subsection
                            (e)(2) is in effect for a crop of feed
                            grains and the producers on a farm
                            devote a portion of the maximum payment
                            acres for feed grains as calculated
                            under subparagraph (C)(ii) of the farm
                            equal to more than 8 percent for each
                            of the 1991 through 1993 crops, and 15
                            percent for each of the 1994 through
                            1997 crops (except as provided in
                            clause (vii)), of such feed grain
                            acreage of the farm for the crop, to
                            conservation uses (except as provided
                            in subparagraph (F))--
                                      [(I) such portion of the
                                    maximum payment acres of the
                                    farm in excess of 8 percent for
                                    each of the 1991 through 1993
                                    crops, and 15 percent for each
                                    of the 1994 through 1997 crops
                                    (except as provided in clause
                                    (vii)), of such acreage devoted
                                    to conservation uses (except as
                                    provided in subparagraph (F))
                                    shall be considered to be
                                    planted to feed grains for the
                                    purpose of determining the
                                    acreage on the farm required to
                                    be devoted to conservation uses
                                    in accordance with subsection
                                    (e)(2)(D); and
                                      [(II) the producers shall be
                                    eligible for payments under
                                    this paragraph with respect to
                                    such acreage.
                              [(ii) Deficiency payments.--
                            Notwithstanding any other provision of
                            this section, any producer who devotes
                            a portion of the maximum payment acres
                            for feed grains for the farm to
                            conservation uses (or other uses as
                            provided in subparagraph (F)) under
                            this subparagraph shall receive
                            deficiency payments on the acreage that
                            is considered to be planted to feed
                            grains and eligible for payments under
                            this subparagraph for the crop at a
                            per-bushel rate established by the
                            Secretary, except that the rate may not
                            be established at less than the
                            projected deficiency payment rate for
                            the crop, as determined by the
                            Secretary. Such projected payment rate
                            for the crop shall be announced by the
                            Secretary prior to the period during
                            which feed grain producers may agree to
                            participate in the program for the
                            crop.
                              [(iii) Adverse effect on agribusiness
                            and other interests.--The Secretary
                            shall implement this subparagraph in
                            such a manner as to minimize the
                            adverse effect on agribusiness and
                            other agriculturally related economic
                            interests within any county, State, or
                            region. In carrying out this
                            subparagraph, the Secretary is
                            authorized to restrict the total
                            quantity of feed grain acreage that may
                            be taken out of production under this
                            subparagraph, taking into consideration
                            the total quantity of acreage that has
                            or will be removed from production
                            under other price support, production
                            adjustment, or conservation program
                            activities. No restrictions on the
                            quantity of acreage that may be taken
                            out of production in accordance with
                            this subparagraph in a crop year shall
                            be imposed in the case of a county in
                            which producers were eligible to
                            receive disaster emergency loans under
                            section 321 of the Consolidated Farm
                            and Rural Development Act (7 U.S.C.
                            1961) as a result of a disaster that
                            occurred during the crop year.
                              [(iv) Crop acreage and payment
                            yield.--The feed grain crop acreage
                            base and feed grain farm program
                            payment yield of the farm shall not be
                            reduced due to the fact that a portion
                            of the permitted feed grain acreage of
                            the farm was devoted to conserving uses
                            (except as provided in subparagraph
                            (F)) under this subparagraph.
                              [(v) Limitation.--Other than as
                            provided in clauses (i) through (iv),
                            payments may not be made under this
                            paragraph for any crop on a greater
                            acreage than the acreage actually
                            planted to feed grains.
                              [(vi) Conservation use acreage under
                            other programs.--Any acreage considered
                            to be planted to feed grains in
                            accordance with clauses (i) and (iv)
                            may not also be designated as
                            conservation use acreage for the
                            purpose of fulfilling any provisions
                            under any acreage limitation or land
                            diversion program requiring that the
                            producers devote a specified acreage to
                            conservation uses.
                              [(vii) Exceptions to 0/85.--In the
                            case of each of the 1994 through 1997
                            crops of feed grains, producers on a
                            farm shall be eligible to receive
                            deficiency payments as provided in
                            clause (ii) if an acreage limitation
                            program under subsection (e) is in
                            effect for the crop and--
                                      [(I)(aa) the producers have
                                    been determined by the
                                    Secretary (in accordance with
                                    section 503(c)) to be prevented
                                    from planting the crop or have
                                    incurred a reduced yield for
                                    the crop (due to a natural
                                    disaster); and
                                      [(bb) the producers elect to
                                    devote a portion of the maximum
                                    payment acres for feed grains
                                    (as calculated under
                                    subparagraph (C)(ii)) equal to
                                    more than 8 percent of the feed
                                    grain acreage, to conservation
                                    uses; or
                                      [(II) the producers elect to
                                    devote a portion of the maximum
                                    payment acres for feed grains
                                    (as calculated under
                                    subparagraph (C)(ii)) equal to
                                    more than 8 percent of the feed
                                    grain acreage, to alternative
                                    crops as provided in
                                    subparagraph (F).
                      [(F) Alternative crops.--
                              [(i) Industrial and other crops.--The
                            Secretary may permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any part of
                            acreage otherwise required to be
                            devoted to conservation uses as a
                            condition of qualifying for payments
                            under subparagraph (E) to be devoted to
                            sweet sorghum, guar, castor beans,
                            plantago ovato, triticale, rye, millet,
                            mung beans, commodities for which no
                            substantial domestic production or
                            market exists but that could yield
                            industrial raw material being imported,
                            or likely to be imported, into the
                            United States, or commodities grown for
                            experimental purposes (including kenaf
                            and milkweed), subject to the following
                            sentence. The Secretary may permit the
                            acreage to be devoted to the production
                            only if the Secretary determines that--

                                      [(I) the production is not
                                    likely to increase the cost of
                                    the price support program; and
                                      [(II) the production is
                                    needed to provide an adequate
                                    supply of the commodity, or, in
                                    the case of commodities for
                                    which no substantial domestic
                                    production or market exists but
                                    that could yield industrial raw
                                    materials, the production is
                                    needed to encourage domestic
                                    manufacture of the raw material
                                    and could lead to increased
                                    industrial use of the raw
                                    material to the long-term
                                    benefit of United States
                                    industry.
                              [(ii) Oilseeds.--The Secretary shall
                            permit, subject to such terms and
                            conditions as the Secretary may
                            prescribe, all or any part of acreage
                            otherwise required to be devoted to
                            conservation uses as a condition of
                            qualifying for payments under
                            subparagraph (E) to be devoted to
                            sunflowers, rapeseed, canola,
                            safflower, flaxseed, mustard seed,
                            sesame, crambe, and other minor
                            oilseeds designated by the Secretary
                            (excluding soybeans). In implementing
                            this clause, the Secretary shall
                            provide that, in order to receive
                            payments under subparagraph (E), the
                            producers shall agree to forgo
                            eligibility to receive a loan under
                            section 205 for the crop of any such
                            oilseed produced on the farm.
                              [(iii) Double cropping.--The
                            Secretary shall permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any portion of
                            the acreage otherwise required to be
                            devoted to conservation uses as a
                            condition of qualifying for payments
                            under subparagraph (E) that is devoted
                            to an industrial, oilseed, or other
                            crop pursuant to clause (i) or (ii) to
                            be subsequently planted during the same
                            crop year to any crop described in
                            subparagraph (B), (C), or (D) of
                            section 504(b)(1). The planting of
                            soybeans as such subsequently planted
                            crop shall be limited to farms
                            determined by the Secretary to have an
                            established history of double cropping
                            soybeans during at least 3 of the
                            preceding 5 years. In implementing this
                            clause, the Secretary shall require
                            producers to agree to forego
                            eligibility to receive loans under this
                            Act for the crop of the subsequently
                            planted crop that is produced on a farm
                            under this clause.
              [(2) Crop insurance requirement.--A producer shall
            obtain catastrophic risk protection insurance coverage
            in accordance with section 427.
      [(d) Payment Yields.--The farm program payment yields for
    farms for each crop of feed grains shall be determined under
    title V.
      [(e) Acreage Reduction Programs.--
              [(1) In general.--
                      [(A) Establishment.--Notwithstanding any
                    other provision of this Act, if the Secretary
                    determines that the total supply of corn, grain
                    sorghum, barley, or oats, in the absence of an
                    acreage limitation program, will be excessive
                    taking into account the need for an adequate
                    carry-over to maintain reasonable and stable
                    supplies and prices and to meet a national
                    emergency, the Secretary may provide for any
                    crop of corn, grain sorghum, barley, or oats an
                    acreage limitation program as described in
                    paragraph (2).
                      [(B) Agricultural resources conservation
                    program.--In making a determination under
                    subparagraph (A), the Secretary shall take into
                    consideration the number of acres placed in the
                    agricultural resources conservation program
                    established under subtitle D of title XII of
                    the Food Security Act of 1985 (16 U.S.C. 3831
                    et seq.).
                      [(C) Announcements.--If the Secretary elects
                    to implement an acreage limitation program for
                    any crop year, the Secretary shall announce the
                    program not later than September 30 prior to
                    the calendar year in which the crop is
                    harvested, except that in the case of the 1991
                    crop, the Secretary shall announce the program
                    as soon as practicable after the date of
                    enactment of this section.
                      [(D) Adjustments.--Not later than November 15
                    of the year previous to the year in which the
                    crop is harvested, the Secretary may make
                    adjustments in the program announced under
                    subparagraph (C) if the Secretary determines
                    that there has been a significant change in the
                    total supply of feed grains since the program
                    was first announced.
                      [(E) Compliance.--As a condition of
                    eligibility for loans, purchases, and payments
                    for any such crop of feed grains, except as
                    provided in subsections (f) and (g) and section
                    504, the producers on a farm must comply with
                    the terms and conditions of the acreage
                    limitation program and, if applicable, a land
                    diversion program as provided in paragraph (5).
                      [(F) Acreage limitation program for 1991
                    crop.--In the case of the 1991 crop of corn,
                    the Secretary shall provide for an acreage
                    limitation program (as described in paragraph
                    (2)) under which the acreage planted to corn
                    for harvest on a farm would be limited to the
                    corn crop acreage base for the farm for the
                    crop reduced by not less than 7.5 percent.
                      [(G) Acreage limitation programs for 1992
                    through 1995 crops.--In the case of each of the
                    1992 through 1995 crops of corn, if the
                    Secretary estimates for a marketing year for
                    the crop that the ratio of ending stocks of
                    corn to total disappearance of corn for the
                    preceding marketing year will be--
                              [(i) more than 25 percent, the
                            Secretary shall provide for an acreage
                            limitation program (as described in
                            paragraph (2)) under which the acreage
                            planted to corn for harvest on a farm
                            would be limited to the corn crop
                            acreage base for the farm for the crop
                            reduced by not less than 10 percent nor
                            more than 20 percent; or
                              [(ii) equal to or less than 25
                            percent, the Secretary may provide for
                            such an acreage limitation program
                            under which the acreage planted to corn
                            for harvest on a farm would be limited
                            to the corn crop acreage base for the
                            farm for the crop reduced by not more
                            than 0 to 12.5 percent.
                    For the purpose of this subparagraph, the term
                    ``total disappearance'' means all corn
                    utilization, including total domestic, total
                    export, and total residual disappearance.
                      [(H) Acreage limitation program for 1991
                    through 1995 crops of oats.--In the case of
                    each of the 1991 through 1995 crops of oats,
                    the Secretary shall provide for an acreage
                    limitation program (as described in paragraph
                    (2)) under which the acreage planted to oats
                    for harvest on a farm would be limited to the
                    oat crop acreage base for the farm for the crop
                    reduced by not more than 0 percent.
              [(2) Acreage limitation program.--
                      [(A) Percentage reductions.--Except as
                    provided in paragraph (3), if a feed grain
                    acreage limitation program is announced under
                    paragraph (1), such limitation shall be
                    achieved by applying a uniform percentage
                    reduction (from 0 to 20 percent) to the crop
                    acreage base for corn, grain sorghum, barley,
                    or oats, respectively, for each feed grain-
                    producing farm.
                      [(B) Compliance.--Except as provided in
                    subsection (g) and section 504, producers who
                    knowingly produce a feed grain in excess of the
                    respective permitted feed grain acreage for the
                    farm shall be ineligible for feed grain loans,
                    purchases, and payments with respect to that
                    farm.
                      [(C) Crop acreage bases.--Feed grain crop
                    acreage bases for each crop of feed grains
                    shall be determined under title V.
                      [(D) Acreage devoted to conservation uses.--A
                    number of acres on the farm shall be devoted to
                    conservation uses, in accordance with
                    regulations issued by the Secretary. Such
                    number shall be determined by multiplying the
                    respective feed grain crop acreage base by the
                    percentage reduction required by the Secretary.
                    The number of acres so determined is hereafter
                    in this subsection referred to as ``reduced
                    acreage''. The remaining acreage is hereafter
                    in this subsection referred to as ``permitted
                    acreage''. Permitted acreage may be adjusted by
                    the Secretary as provided in paragraph (3) and
                    in section 504.
                      [(E) Individual farm program acreage.--Except
                    as otherwise provided in subsection (c), the
                    individual farm program acreage shall be the
                    acreage planted on the farm to feed grains for
                    harvest within the permitted feed grain acreage
                    for the farm as established under this
                    paragraph.
                      [(F) Planting designated crops on reduced
                    acreage.--
                              [(i) Definition of designated crop.--
                            As used in this subparagraph, the term
                            ``designated crop'' means a crop
                            defined in section 504(b)(1), excluding
                            any program crop as defined in section
                            502(3).
                              [(ii) In general.--Subject to clause
                            (iii), the Secretary may permit
                            producers on a farm to plant a
                            designated crop on no more than one-
                            half of the reduced acreage on the
                            farm.
                              [(iii) Limitations.--If the producers
                            on a farm elect to plant a designated
                            crop on reduced acreage under this
                            subparagraph--
                                      [(I) the amount of the
                                    deficiency payment that the
                                    producers are otherwise
                                    eligible to receive under
                                    subsection (c) shall be
                                    reduced, for each acre (or
                                    portion thereof) that is
                                    planted to the designated crop,
                                    by an amount equal to the
                                    deficiency payment that would
                                    be made with respect to a
                                    number of acres of the crop
                                    that the Secretary considers
                                    appropriate, except that if the
                                    producers on the farm are
                                    participating in a program
                                    established for more than one
                                    program crop, the amount of the
                                    reduction shall be determined
                                    by prorating the reduction
                                    based on the acreage planted or
                                    considered planted on the farm
                                    to all of such program crops;
                                    and
                                      [(II) the Secretary shall
                                    ensure that reductions in
                                    deficiency payments under
                                    subclause (I) are sufficient to
                                    ensure that this subparagraph
                                    will result in no additional
                                    cost to the Commodity Credit
                                    Corporation.
                      [(G) Exception for malting barley.--The
                    Secretary may provide that no producer of
                    malting barley shall be required as a condition
                    of eligibility for feed grain loans, purchases,
                    and payments to comply with any acreage
                    limitation under this paragraph if the producer
                    has previously produced a malting variety of
                    barley for harvest, plants barley only of an
                    acceptable malting variety for harvest, and
                    meets such other conditions as the Secretary
                    may prescribe. The Secretary shall make an
                    annual determination of whether to exempt such
                    producers from compliance with any acreage
                    limitation under this paragraph and shall
                    announce such determination in the Federal
                    Register.
                      [(H) Corn and sorghum bases.--Notwithstanding
                    any other provision of this Act, with respect
                    to each of the 1992 through 1995 crops of corn
                    and grain sorghums--
                              [(i) the Secretary shall combine the
                            permitted acreages established under
                            subparagraph (D) for a farm for a crop
                            year for corn and grain sorghums;
                              [(ii) for each crop year, the sum of
                            the acreage planted and considered
                            planted to corn and grain sorghum, as
                            determined by the Secretary under this
                            section and title V, shall be prorated
                            to corn and grain sorghum based on the
                            ratio of the crop acreage base for the
                            individual crop of corn or grain
                            sorghum, as applicable, to the sum of
                            the crop acreage bases for corn and
                            grain sorghum established for each crop
                            year; and
                              [(iii) for each crop year, the sum of
                            the corn and grain sorghum payment
                            acres, as determined under subsection
                            (c), shall be prorated to corn and
                            grain sorghum based on the ratio of the
                            maximum payment acres for the
                            individual crop of corn or grain
                            sorghum, as applicable, to the sum of
                            the maximum payment acres for corn and
                            grain sorghum established for each crop
                            year.
              [(3) Targeted option payments.--
                      [(A) In general.--Notwithstanding any other
                    provision of this section, if the Secretary
                    implements an acreage limitation program with
                    respect to any of the 1991 through 1995 crops
                    of feed grains, the Secretary may make
                    available to producers on a farm who do not
                    receive payments under subsection (c)(1)(E) for
                    such crop on the farm, adjustments in the level
                    of deficiency payments that would otherwise be
                    made available to the producers if the
                    producers exercise the payment options provided
                    in this paragraph.
                      [(B) Payment options.--If the Secretary
                    elects to carry out this paragraph, the
                    Secretary shall make the payment options
                    specified in subparagraphs (C) and (D)
                    available to producers who agree to make
                    adjustments in the quantity of acreage diverted
                    from the production of feed grains under an
                    acreage limitation program in accordance with
                    this paragraph.
                      [(C) Increased acreage limitation option.--
                              [(i) Increase in established price.--
                            If the Secretary elects to carry out
                            this paragraph, a producer shall be
                            eligible to receive an increase in the
                            established price for corn under clause
                            (ii) if the producer agrees to an
                            increase in the acreage limitation
                            percentage to be applied to the
                            producers' corn acreage base above the
                            acreage limitation percentage announced
                            by the Secretary.
                              [(ii) Method of calculation.--For the
                            purposes of calculating deficiency
                            payments to be made available to
                            producers who participate in the
                            program under this paragraph, the
                            Secretary shall increase the
                            established price for corn by an amount
                            determined by the Secretary, but not
                            less than 0.5 percent, nor more than 1
                            percent, for each 1 percentage point
                            increase in the acreage limitation
                            percentage applied to the producers'
                            corn acreage base.
                              [(iii) Limitation.--The acreage
                            limitation percentage to be applied to
                            the producers' corn acreage base shall
                            not be increased by more than 5
                            percentage points for the 1991 crop and
                            10 percentage points for each of the
                            1992 through 1995 crops above the
                            acreage limitation percentage announced
                            by the Secretary for the crop or above
                            20 percent total for the crop.
                      [(D) Decreased acreage limitation option.--
                              [(i) Decrease in acreage limitation
                            requirement.--If the Secretary elects
                            to carry out this paragraph, a producer
                            shall be eligible to decrease the
                            acreage limitation percentage
                            applicable to the producers' corn
                            acreage base (as announced by the
                            Secretary) if the producer agrees to a
                            decrease in the established price for
                            corn under clause (ii) for the purpose
                            of calculating deficiency payments to
                            be made available to the producer.
                              [(ii) Method of calculation.--For the
                            purposes of calculating deficiency
                            payments to be made available to
                            producers who choose the option set
                            forth in this subparagraph, the
                            Secretary shall decrease the
                            established price for corn by an amount
                            to be determined by the Secretary, but
                            not less than 0.5 percent, nor more
                            than 1 percent, for each 1 percentage
                            point decrease in the acreage
                            limitation percentage applied to the
                            producers' corn acreage base.
                              [(iii) Limitation.--A producer may
                            not choose to decrease the acreage
                            limitation percentage applicable to the
                            producers' corn acreage base under this
                            paragraph by more than one-half of the
                            announced acreage limitation
                            percentage.
                      [(E) Other feed grains.--The Secretary shall
                    implement the program provided for by this
                    paragraph for other feed grains similar to the
                    manner in which the program is implemented for
                    corn.
                      [(F) Participation and production effects.--
                    Notwithstanding any other provision of this
                    paragraph, the Secretary shall, to the extent
                    practicable, ensure that the program provided
                    for in this paragraph does not have a
                    significant effect on program participation or
                    total production and shall be offered in such a
                    manner that the Secretary determines will
                    result in no additional budget outlays. The
                    Secretary shall provide an analysis of the
                    Secretary's determination to the Committee on
                    Agriculture of the House of Representatives and
                    the Committee on Agriculture, Nutrition, and
                    Forestry of the Senate.
              [(4) Administration.--
                      [(A) Protection from weeds and erosion.--The
                    regulations issued by the Secretary under
                    paragraph (2) with respect to acreage required
                    to be devoted to conservation uses shall assure
                    protection of the acreage from weeds and wind
                    and water erosion.
                      [(B) Annual or perennial cover.--
                              [(i) Required.--
                                      [(I) In general.--Except as
                                    provided in subclause (II) and
                                    paragraph (2), a producer who
                                    participates in an acreage
                                    reduction program established
                                    for a crop of feed grains under
                                    this subsection shall be
                                    required to plant to, or
                                    maintain as, an annual or
                                    perennial cover 50 percent (or
                                    more at the option of the
                                    producer) of the acreage that
                                    is required to be removed from
                                    the production of feed grains,
                                    but not to exceed 5 percent (or
                                    more at the option of the
                                    producer) of the crop acreage
                                    base established for the crop.
                                      [(II) Arid areas.--Subclause
                                    (I) shall not apply with
                                    respect to arid areas
                                    (including summer fallow
                                    areas), as determined by the
                                    Secretary. If the Secretary
                                    determines any county in a
                                    State to be arid, the
                                    respective State committee
                                    established under section 8(b)
                                    of the Soil Conservation and
                                    Domestic Allotment Act (16
                                    U.S.C. 590h(b)) may designate
                                    any other county or counties or
                                    all of the State as arid for
                                    the purposes of this paragraph.
                                      [(III) Approval of cover
                                    crops and practices.--The State
                                    committee, after receiving
                                    recommendations from the county
                                    committees, shall approve
                                    appropriate crops planted or
                                    maintained as cover, including,
                                    as appropriate, annual or
                                    perennial native grasses and
                                    legumes or other vegetation.
                                    The State committee shall
                                    establish the final seeding
                                    date for the planting of the
                                    cover and shall approve
                                    appropriate cover crops or
                                    practices, after consulting the
                                    Soil Conservation Service State
                                    Conservationist regarding
                                    whether the crops or practices
                                    will sufficiently protect the
                                    land from weeds and wind and
                                    water erosion. After the
                                    Secretary establishes the State
                                    technical committee for the
                                    State pursuant to section 1261
                                    of the Food Security Act of
                                    1985 (16 U.S.C. 3861), the
                                    State committee shall consult
                                    with the technical committee
                                    (rather than the Soil
                                    Conservation Service State
                                    Conservationist) regarding
                                    whether the crops or practices
                                    will sufficiently protect the
                                    land from weeds and wind and
                                    water erosion.
                              [(ii) Multiyear program.--
                                      [(I) Cost-share assistance.--
                                    If a producer elects to
                                    establish a perennial cover
                                    capable of improving water
                                    quality or wildlife habitat on
                                    the acreage, the Commodity
                                    Credit Corporation shall make
                                    available cost-share assistance
                                    for 25 percent of the approved
                                    cost of establishing the cover
                                    on not more than 50 percent of
                                    the acreage that is required to
                                    be diverted from production,
                                    but not to exceed 5 percent (or
                                    more, at the option of the
                                    producer) of the crop acreage
                                    base established for a crop.
                                      [(II) Agreement of
                                    producer.--If a producer elects
                                    to establish a perennial cover
                                    on the acreage under this
                                    subparagraph and receives cost-
                                    share assistance from the
                                    Corporation with respect to the
                                    cover, the producer, under such
                                    terms and conditions as may be
                                    prescribed by the Secretary,
                                    taking into consideration
                                    guidelines established by the
                                    State technical committees
                                    established in subtitle G of
                                    title XII of the Food Security
                                    Act of 1985, shall agree to
                                    maintain the perennial cover
                                    for a minimum of 3 years.
                              [(iii) Conserving crops.--The
                            Secretary may permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any part of the
                            acreage to be devoted to sweet sorghum,
                            guar, sesame, castor beans, crambe,
                            plantago ovato, triticale, rye, mung
                            beans, milkweed, or other commodity, if
                            the Secretary determines that the
                            production is needed to provide an
                            adequate supply of the commodities, is
                            not likely to increase the cost of the
                            price support program, and will not
                            affect farm income adversely.
                      [(C) Haying and grazing.--
                              [(i) In general.--Except as provided
                            in clause (ii), haying and grazing of
                            reduced acreage, acreage devoted to a
                            conservation use under subsection
                            (c)(1)(E), and acreage diverted from
                            production under a land diversion
                            program established under this section
                            shall be permitted, except during any
                            consecutive 5-month period that is
                            established by the State committee
                            established under section 8(b) of the
                            Soil Conservation and Domestic
                            Allotment Act (16 U.S.C. 590h(b)) for a
                            State. The 5-month period shall be
                            established during the period beginning
                            April 1, and ending October 31, of a
                            year.
                              [(ii) Natural disasters.--In the case
                            of a natural disaster, the Secretary
                            may permit unlimited haying and grazing
                            on the acreage. The Secretary may not
                            exclude irrigated or irrigable acreage
                            not planted in alfalfa when exercising
                            the authority under this clause.
                      [(D) Water storage uses.--
                              [(i) In general.--The regulations
                            issued by the Secretary under paragraph
                            (2) with respect to acreage required to
                            be devoted to conservation uses shall
                            provide that land that has been
                            converted to water storage uses shall
                            be considered to be devoted to
                            conservation uses if the land was
                            devoted to wheat, feed grains, cotton,
                            rice, or oilseeds in at least 3 of the
                            immediately preceding 5 years. The land
                            shall be considered to be devoted to
                            conservation uses for the period that
                            the land remains in water storage uses,
                            but not to exceed 5 years subsequent to
                            its conversion to water storage uses.
                              [(ii) Limitations.--Land converted to
                            water storage uses for the purposes of
                            this subparagraph may not be devoted to
                            any commercial use, including
                            commercial fish production. The water
                            stored on the land may not be ground
                            water. The farm on which the land is
                            located must have been irrigated with
                            ground water during at least 1 of the
                            preceding 5 crop years.
                      [(E) Summer fallow.--In determining the
                    quantity of land to be devoted to conservation
                    uses under an acreage limitation program with
                    respect to land that has been farmed under
                    summer fallow practices, as defined by the
                    Secretary, the Secretary shall consider the
                    effects of soil erosion and such other factors
                    as the Secretary considers appropriate.
              [(5) Land diversion payments.--
                      [(A) In general.--The Secretary may make land
                    diversion payments to producers of feed grains,
                    whether or not an acreage limitation program
                    for feed grains is in effect, if the Secretary
                    determines that the land diversion payments are
                    necessary to assist in adjusting the total
                    national acreage of feed grains to desirable
                    goals. The land diversion payments shall be
                    made to producers who, to the extent prescribed
                    by the Secretary, devote to approved
                    conservation uses an acreage of cropland on the
                    farm in accordance with land diversion
                    contracts entered into by the Secretary with
                    the producers.
                      [(B) Amounts.--The amounts payable to
                    producers under land diversion contracts may be
                    determined through the submission of bids for
                    the contracts by producers in such manner as
                    the Secretary may prescribe or through such
                    other means as the Secretary determines
                    appropriate. In determining the acceptability
                    of contract offers, the Secretary shall take
                    into consideration the extent of the diversion
                    to be undertaken by the producers and the
                    productivity of the acreage diverted.
                      [(C) Limitation on diverted acreage.--The
                    Secretary shall limit the total acreage to be
                    diverted under agreements in any county or
                    local community so as not to affect adversely
                    the economy of the county or local community.
              [(6) Conservation practices.--
                      [(A) Wildlife food plots or habitat.--The
                    reduced acreage and additional diverted acreage
                    may be devoted to wildlife food plots or
                    wildlife habitat in conformity with standards
                    established by the Secretary in consultation
                    with wildlife agencies. The Secretary may pay
                    an appropriate share of the cost of practices
                    designed to carry out the purposes of this
                    subparagraph.
                      [(B) Soil and water conservation practices.--
                    The Secretary may also pay an appropriate share
                    of the cost of approved soil and water
                    conservation practices (including practices
                    that may be effective for a number of years)
                    established by the producer on acreage required
                    to be devoted to conservation uses or on
                    additional diverted acreage.
                      [(C) Public accessibility.--The Secretary may
                    provide for an additional payment on the
                    acreage in an amount determined by the
                    Secretary to be appropriate in relation to the
                    benefit to the general public if the producer
                    agrees to permit, without other compensation,
                    access to all or such portion of the farm, as
                    the Secretary may prescribe, by the general
                    public, for hunting, trapping, fishing, and
                    hiking, subject to applicable State and Federal
                    regulations.
              [(7) Participation agreements.--
                      [(A) In general.--Producers on a farm
                    desiring to participate in the program
                    conducted under this subsection shall execute
                    an agreement with the Secretary providing for
                    the participation not later than such date as
                    the Secretary may prescribe.
                      [(B) Modification or termination.--The
                    Secretary may, by mutual agreement with
                    producers on a farm, modify or terminate any
                    such agreement if the Secretary determines the
                    action necessary because of an emergency
                    created by drought or other disaster or to
                    prevent or alleviate a shortage in the supply
                    of agricultural commodities. The Secretary may
                    modify the agreement under this subparagraph
                    for the purpose of alleviating a shortage in
                    the supply of agricultural commodities only if
                    there has been a significant change in the
                    estimated stocks of the commodity since the
                    Secretary announced the final terms and
                    conditions of the program for the crop of feed
                    grains.
              [(8) Special oats plantings.--In any crop year that
            the Secretary determines that projected domestic
            production of oats will not fulfill the projected
            domestic demand for oats, notwithstanding the foregoing
            provisions of this subsection, the Secretary--
                      [(A) may provide that any reduced acreage may
                    be planted to oats for harvest;
                      [(B) may make program benefits (including
                    loans, purchases, and payments) available under
                    the annual program for oats under this section
                    available to producers with respect to acreage
                    planted to oats under this paragraph; and
                      [(C) shall not make program benefits other
                    than the benefits specified in subparagraph (B)
                    available to producers with respect to acreage
                    planted to oats under this paragraph.
      [(f) Inventory Reduction Payments.--
              [(1) In general.--The Secretary may, for each of the
            1991 through 1995 crops of feed grains, make payments
            available to producers who meet the requirements of
            this subsection.
              [(2) Form.--The payments may be made in the form of
            marketing certificates.
              [(3) Payments.--Payments under this subsection shall
            be determined in the same manner as provided in
            subsection (b).
              [(4) Eligibility.--A producer shall be eligible to
            receive a payment under this subsection for a crop if
            the producer--
                      [(A) agrees to forgo obtaining a loan or
                    purchase agreement under subsection (a);
                      [(B) agrees to forgo receiving payments under
                    subsection (c);
                      [(C) does not plant feed grains for harvest
                    in excess of the crop acreage base reduced by
                    one-half of any acreage required to be diverted
                    from production under subsection (e); and
                      [(D) otherwise complies with this section.
      [(g) Pilot Voluntary Production Limitation Program.--
              [(1) In general.--Effective for the 1992 or 1993
            crops (and, if the Secretary so determines, the 1994
            and 1995 crops), if a feed grain acreage limitation
            program or a land diversion program is announced under
            subsection (e) for such crops, the Secretary shall
            carry out a pilot program in at least 15 counties in at
            least 2 States where producers express an interest in
            participating in the pilot program under which the
            producers on a farm shall be considered to have met the
            requirements of such acreage limitation or land
            diversion program if the producers meet the
            requirements of the voluntary production limitation
            program established under this subsection.
              [(2) Limitation on marketing.--In order to comply
            with the voluntary production limitation program, the
            producers on a farm must agree not to market, barter,
            donate, or use on the farm (including use as feed for
            livestock) in a marketing year a quantity of feed
            grains in excess of the feed grain production
            limitation quantity for the farm for the marketing
            year.
              [(3) Production limitation quantity.--For purposes of
            this subsection, the production limitation quantity for
            a farm for a marketing year for a crop shall equal the
            product obtained by multiplying--
                      [(A) the acreage permitted to be planted to
                    feed grains under the acreage reduction program
                    or land diversion program in effect for the
                    crop for the farm; by
                      [(B) the higher of--
                              [(i) the farm program payment yield
                            for the farm; or
                              [(ii) the average of the yield per
                            harvested acre for feed grains for the
                            farm for each of the 5 crop years
                            immediately preceding the crop year
                            during which the producers first
                            participate in the program established
                            under this subsection, excluding the
                            crop years with the highest and lowest
                            yield per harvested acre and any crop
                            year in which the commodity was not
                            planted on the farm.
              [(4) Terms and conditions.--Producers on a farm who
            elect to participate in the program established under
            this subsection for a crop of feed grains shall--
                      [(A) enter into an agreement with the
                    Secretary providing that the producers shall
                    comply with the program for the crop;
                      [(B) not plant program commodities for
                    harvest in a quantity in excess of the sum of
                    the crop acreage bases for the farm; and
                      [(C) be considered to have complied with the
                    terms and conditions of the feed grain acreage
                    reduction program or land diversion program for
                    the crop, even though the acreage planted to
                    feed grains on the farm exceeds the permitted
                    acreage provided under the acreage reduction or
                    land diversion program.
              [(5) Excess production.--
                      [(A) In general.--Any quantity of feed grains
                    produced in a crop year on a farm in excess of
                    the production limitation quantity for the farm
                    may be stored by the producers for a period of
                    not to exceed 5 marketing years and may be used
                    only in accordance with this paragraph.
                      [(B) Marketing in subsequent year.--
                              [(i) Participants in program.--
                            Producers on a farm who are
                            participating in the program
                            established under this subsection may
                            market, barter, or use a quantity of
                            the excess feed grains referred to in
                            subparagraph (A) equal to the
                            difference between the production
                            limitation quantity for the farm for
                            the crop year subsequent to the crop
                            year in which the excess feed grains
                            are produced less the quantity of feed
                            grains produced on the farm during the
                            crop year.
                              [(ii) Participants in acreage
                            reduction program.--Producers on a farm
                            who are participating in an acreage
                            reduction or a land diversion program
                            for a crop of feed grains may market,
                            barter, or use a quantity of the excess
                            feed grains referred to in subparagraph
                            (A) in an amount that reflects the
                            quantity of feed grains that would be
                            expected to be produced on acreage that
                            the producers agree to devote to
                            approved conservation uses (in excess
                            of any acreage reduction or land
                            diversion requirements) during a crop
                            year, as determined by the Secretary.
              [(6) Duties of secretary.--In carrying out the pilot
            program established under this subsection, the
            Secretary--
                      [(A) shall issue such regulations as are
                    necessary to carry out the program;
                      [(B) may require increased acreage reduction
                    or land diversion requirements with respect to
                    producers who have had excess feed grain
                    production in order to allow the producers to
                    market, barter, or use the production in
                    subsequent years;
                      [(C) shall take appropriate measures designed
                    to prevent the circumvention of the program
                    established under this subsection, including
                    the imposition of penalties;
                      [(D) may require producers who participate in
                    the program for a crop, but who fail to comply
                    with the terms and conditions of the program,
                    to refund all or a part of any deficiency
                    payments received with respect to the crop;
                      [(E) may require the forfeiture to the
                    Commodity Credit Corporation of any feed grains
                    that are produced in excess of the production
                    limitation quantity and that are not marketed,
                    bartered, or used within 5 marketing years; and
                      [(F) shall ensure equitable treatment for
                    producers who participate in the pilot program
                    if the Secretary allows increases (based on
                    actual production levels) in the determination
                    of farm program payment yields for feed grains
                    for the farm.
              [(7) Report.--
                      [(A) In general.--The Comptroller General of
                    the United States shall prepare a report that
                    evaluates the pilot program carried out under
                    this subsection.
                      [(B) Submission.--The Comptroller General
                    shall submit a copy of the report required by
                    subparagraph (A) to the Committee on
                    Agriculture of the House of Representatives,
                    the Committee on Agriculture, Nutrition, and
                    Forestry of the Senate, and the Secretary.
      [(h) Equitable Relief.--
              [(1) Loans, purchases, and payments.--If the failure
            of a producer to comply fully with the terms and
            conditions of the program conducted under this section
            precludes the making of loans, purchases, and payments,
            the Secretary may, nevertheless, make such loans,
            purchases, and payments in such amounts as the
            Secretary determines are equitable in relation to the
            seriousness of the failure. The Secretary may consider
            whether the producer made a good faith effort to comply
            fully with the terms and conditions of such program in
            determining whether equitable relief is warranted under
            this paragraph.
              [(2) Deadlines and program requirements.--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 program requirements in
            cases in which lateness or failure to meet such other
            requirements does not affect adversely the operation of
            the program.
      [(i) Regulations.--The Secretary may issue such regulations
    as the Secretary determines necessary to carry out this
    section.
      [(j) Commodity Credit Corporation.--The Secretary shall carry
    out the program authorized by this section through the
    Commodity Credit Corporation.
      [(k) 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 under this section.
      [(l) Sharing of Payments.--The Secretary shall provide for
    the sharing of payments made under this section for any farm
    among the producers on the farm on a fair and equitable basis.
      [(m) Tenants and Sharecroppers.--The Secretary shall provide
    adequate safeguards to protect the interests of tenants and
    sharecroppers.
      [(n) Cross-Compliance.--
              [(1) In general.--Compliance on a farm with the terms
            and conditions of any other commodity program, or
            compliance with crop acreage base requirements for any
            other commodity, may not be required as a condition of
            eligibility for loans, purchases, or payments under
            this section.
              [(2) Compliance on other farms.--The Secretary may
            not require producers on a farm, as a condition of
            eligibility for loans, purchases, or payments under
            this section for the farm, to comply with the terms and
            conditions of the feed grains program with respect to
            any other farm operated by the producers.
      [(o) Public Comment on Feed Grains Program.--
              [(1) In general.--In order to ensure that producers
            and consumers of feed grains are provided with
            reasonable opportunity to comment on the annual program
            determinations concerning the price support and acreage
            reduction program for each of the 1992 and subsequent
            crops of feed grains, the Secretary shall request
            public comment regarding the feed grains program in
            accordance with this subsection.
              [(2) Options.--Not less than 60 days before the
            program is announced for a crop of feed grains under
            this section, the Secretary shall propose for public
            comment various program options for the crop of feed
            grains.
              [(3) Analyses.--Each option proposed by the Secretary
            shall be accompanied by an analysis that includes the
            estimated planted acreage, production, domestic and
            export use, ending stocks, season average producer
            price, program participation rate, and cost to the
            Federal Government that would likely result from each
            option.
              [(4) Estimates.--In announcing the program for a crop
            of feed grains under this section, the Secretary shall
            include an estimate of the planted acreage, production,
            domestic and export use, ending stocks, season average
            producer price, program participation rate, and cost to
            the Federal Government that is expected to result from
            the program as announced.
      [(p) Malting Barley.--
              [(1) Assessment required.--In order to help offset
            costs associated with deficiency payments made
            available under this section to producers of barley,
            the Secretary shall provide for an assessment for each
            of the 1991 through 1995 crop years to be levied on any
            producer of malting barley produced on a farm that is
            enrolled for the crop year in the production adjustment
            program under this section. The Secretary shall
            establish such assessment at not more than 5 percent of
            the value of the malting barley produced on program
            payment acres on the farm during each of the 1991
            through 1995 crop years. The production per acre on
            which the assessment is based shall not be greater than
            the farm program payment yield.
              [(2) Value of malting barley.--The Secretary may
            establish the value of such malting barley at the
            lesser of the State or national weighted average market
            price received by producers of malting barley for the
            first 5 months of the marketing year. In calculating
            the State or national weighted average market price,
            the Secretary may exclude the value of malting barley
            that is contracted for sale by producers prior to
            planting.
              [(3) Exception to assessment.--In counties where
            malting barley is produced, participating barley
            producers may certify to the Secretary prior to
            computation of final deficiency payments that part or
            all of the producer's production was (or will be) sold
            or used for nonmalting purposes. The portion certified
            as sold or used for nonmalting purposes shall not be
            subject to the assessment. The Secretary may require
            producers to provide to the Secretary such
            documentation as the Secretary considers appropriate to
            carry out this paragraph.
      [(q) Price Support for High Moisture Feed Grains.--
              [(1) Recourse loans.--Notwithstanding any other
            provision of law, effective for each of the 1991
            through 1995 crops of feed grains, the Secretary
            (through the Commodity Credit Corporation) shall make
            available recourse loans, as determined by the
            Secretary, to producers on a farm who--
                      [(A) normally harvest all or a portion of
                    their crop of feed grains in a high moisture
                    state, hereinafter in this subsection defined
                    as a feed grain having a moisture content in
                    excess of Commodity Credit Corporation
                    standards for loans made by the Secretary under
                    paragraphs (1) and (6) of subsection (a);
                      [(B)(i) present certified scale tickets from
                    an inspected, certified commercial scale,
                    including licensed warehouses, feedlots, feed
                    mills, distilleries, or other similar entities
                    approved by the Secretary, pursuant to
                    regulations issued by the Secretary; or
                      [(ii) present field or other physical
                    measurements of the standing or stored feed
                    grain crop in regions of the country, as
                    determined by the Secretary, that do not have
                    certified commercial scales from which
                    certified scale tickets may be obtained within
                    reasonable proximity of harvest operation;
                      [(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 was in
                    fact harvested on the farm and delivered to, a
                    feedlot, feed mill, or commercial or on-farm
                    high-moisture storage facility, or to such
                    facilities maintained by the users of such
                    high-moisture feed grain;
                      [(D) comply with deadlines established by the
                    Secretary for harvesting the feed grain and
                    submit applications for loans within deadlines
                    established by the Secretary; and
                      [(E) participate in an acreage limitation
                    program for the crop of feed grains established
                    by the Secretary.
              [(2) Eligibility of acquired feed grains.--The loans
            shall be made on a quantity of feed grains of the same
            crop acquired by the producer equivalent to a quantity
            determined by multiplying--
                      [(A) the acreage of the feed grain in a high
                    moisture state harvested on the producer's
                    farm; by
                      [(B) the lower of the farm program payment
                    yield or the actual yield on a field, as
                    determined by the Secretary, that is similar to
                    the field from which such high moisture feed
                    grain was obtained.
      [(r) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through 1995 crops
    of feed grains.
      [Sec. 106. Notwithstanding any of the provisions of section
    101 of this Act: (a) For the 1960 crop of any kind of tobacco
    for which marketing quotas are in effect, or for which
    marketing quotas are not disapproved by producers, the support
    level in cents per pound shall be the level at which the 1959
    crop of such kind of tobacco was supported, or if marketing
    quotas were disapproved for the 1959 crop of such kind of
    tobacco, the level at which the 1959 crop of such kind of
    tobacco would have been supported if marketing quotas had been
    in effect. (b) For the 1961 crop and each subsequent crop of
    any kind of tobacco for which marketing quotas are in effect,
    or for which marketing quotas are not disapproved by producers,
    the support level in cents per pound shall be determined by
    adjusting the support level for the 1959 crop of such kind of
    tobacco, or if marketing quotas were disapproved for the 1959
    crop of such kind of tobacco, the level at which the 1959 crop
    of such kind of tobacco would have been supported if marketing
    quotas had been in effect, by multiplying such support level
    for the 1959 crop by the ratio of (i) the average of the index
    of prices paid by farmers, including wage rates, interest, and
    taxes, as defined in section 301(a)(1)(C) of the Agricultural
    Adjustment Act of 1938, as amended, for the three calendar
    years immediately preceding the calendar year in which the
    marketing year begins for the crop for which the support level
    is being determined to (ii) the average index of such prices
    paid by farmers, including wage rates, interest, and taxes for
    the calendar year 1959.
      [(c) If acreage poundage or poundage farm marketing quotas
    are in effect under section 317 or 319 of the Agricultural
    Adjustment Act of 1938, as amended, (1) price support shall not
    be made available on tobacco marketed in excess of 103 per
    centum of the marketing quota (after adjustments) for the farm
    on which such tobacco was produced, and (2) for the purpose of
    price-support eligibility, tobacco carried over from one
    marketing year to another shall, when marketed, be considered
    tobacco of the then current crop.
      [(d) Notwithstanding the provisions of section 403, if the
    Secretary determines that the supply of any grade of any kind
    of tobacco of a crop for which marketing quotas are in effect
    or are not disapproved by producers will likely be excessive,
    the Secretary, after prior consultation with the association
    through which price support for the grade and kind of tobacco
    is made available to producers, may reduce the support rate
    which would otherwise be established for such grade of tobacco
    after taking into consideration the effect such reduction may
    have on the supply and price of other grades of other kinds of
    quota tobacco: Provided, That the weighted average of the
    support rates for all eligible grades of such kind of tobacco
    shall, after such reduction, reflect not less than (1) 65 per
    centum of the increase in the support level for such kind of
    tobacco which would otherwise be established under this
    section, if the support level therefor is higher than the
    support level for the preceding crop, or (2) the support level
    for such kind of tobacco established under this section, if the
    support level therefor is not higher than the support level for
    the preceding crop. In determining whether the supply of any
    grade of any kind of tobacco of a crop will be excessive, the
    Secretary shall take into consideration the domestic supply,
    including domestic inventories, the amount of such tobacco
    pledged as security for price support loans, and anticipated
    domestic and export demand, based on the maturity, uniformity
    and stalk position of such tobacco.
      [(f) Notwithstanding the foregoing provisions of this
    section--
              [(6)(A) Except as provided in subparagraph (B), for
            the 1986 and each subsequent crop of any kind of
            tobacco (other than Flue-cured and Burley tobacco) for
            which marketing quotas are in effect or are not
            disapproved by producers, the support level shall be
            the level in cents per pound at which the immediately
            preceding crop was supported, plus or minus,
            respectively, the amount by which--
                      [(i) the support level for the crop for which
                    the determination is being made, as determined
                    under subsection (b); is greater or less than
                      [(ii) the support level for the immediately
                    preceding crop, as determined under subsection
                    (b),
            as that difference may be adjusted by the Secretary
            under subsection (d) if the support level under clause
            (i) is greater than the support level under clause
            (ii).
              [(B) Notwithstanding subparagraph (A) and subsection
            (d), if requested by the board of directors of an
            association through which price support for the
            respective kind of tobacco specified in subparagraph
            (A) is made available to producers, the Secretary may
            reduce the support level for such kind of tobacco to
            the extent requested by the association to more
            accurately reflect the market value and improve the
            marketability of such tobacco.
              [(7)(A) For the 1987 and each subsequent crop of
            Flue-cured and Burley tobacco for which marketing
            quotas are in effect or are not disapproved by
            producers, the support level shall be the level in
            cents per pound at which the immediately preceding crop
            was supported, plus or minus, respectively, an
            adjustment of not less than 65 percent nor more than
            100 percent of the total, as determined by the
            Secretary after taking into consideration the supply of
            the kind of tobacco involved in relation to demand,
            of--
                      [(i) 66.7 percent of the amount by which--
                              [(I) the average price received by
                            producers for Flue-cured and Burley
                            tobacco, respectively, on the United
                            States auction markets, as determined
                            by the Secretary, during the 5
                            marketing years immediately preceding
                            the marketing year for which the
                            determination is being made, excluding
                            the year in which the average price was
                            the highest and the year in which the
                            average price was the lowest in such
                            period, is greater or less than
                              [(II) the average price received by
                            producers for Flue-cured and Burley
                            tobacco, respectively, on the United
                            States auction markets, as determined
                            by the Secretary, during the 5
                            marketing years immediately preceding
                            the marketing year prior to the
                            marketing year for which the
                            determination is being made, excluding
                            the year in which the average price was
                            the highest and the year in which the
                            average price was the lowest in such
                            period; and
                      [(ii) 33.3 percent of the change, expressed
                    as a cost per pound of tobacco, in the index of
                    prices paid by tobacco producers from January 1
                    to December 31 of the calendar year immediately
                    preceding the year in which the determination
                    is made.
              [(B) For purposes of subparagraph (A)--
                      [(i) the average market price for Burley
                    tobacco for the 1985 marketing year shall be
                    reduced by $0.039 per pound;
                      [(ii) the average market price for Burley
                    tobacco for the 1984 and each prior applicable
                    marketing year shall be reduced by $0.30 per
                    pound;
                      [(iii) the average market price for Flue-
                    cured tobacco for the 1985 marketing year shall
                    be reduced by $0.25 per pound;
                      [(iv) the average market price for Flue-cured
                    tobacco for the 1984 and each prior applicable
                    marketing year shall be reduced by $0.30 per
                    pound; and
                      [(v) the index of prices paid by tobacco
                    producers shall include items representing
                    general, variable costs of producing tobacco,
                    as determined by the Secretary, but shall not
                    include the cost of land, risk, overhead,
                    management, purchase or leasing of quotas,
                    marketing contributions or assessments, and
                    other costs not directly related to the
                    production of tobacco.
              [(8)(A) Notwithstanding any other provision of this
            subsection, in the case of each of the 1988 and 1989
            crops of any kind of tobacco, the Secretary shall
            reduce the support level for such crop by an amount
            equal to 1.4 percent of the level otherwise established
            under this subsection. Any such reduction shall not be
            taken into consideration in determining the support
            level for a subsequent crop of tobacco.
              [(B) In lieu of making any such reduction, the
            Secretary may impose assessments on the producers and
            purchasers in an amount sufficient to realize a
            reduction in outlays equal to the amount that would
            have been achieved as a result of the reduction
            required under subparagraph (A). Such assessments shall
            not apply to purchasers if it is judicially determined
            that the imposition of the purchaser assessment will
            adversely affect the contracts entered into under
            section 1109 of the Consolidated Omnibus Budget
            Reconciliation Act of 1986 (7 U.S.C. 1445-3).
      [(g)(1) Effective only for each of the 1994 through 1998
    crops of tobacco for which price support is made available
    under this Act, each producer and purchaser of such tobacco,
    and each importer of the same kind of tobacco, shall remit to
    the Commodity Credit Corporation a nonrefundable marketing
    assessment in an amount equal to--
                      [(A) in the case of a producer or purchaser
                    of domestic tobacco, .5 percent of the national
                    price support level for each such crop; and
                      [(B) in the case of an importer of tobacco, 1
                    percent of the national support price for the
                    same kind of tobacco;
            as provided for in this section.
      [(2) Such producer, purchaser, and importer assessments shall
    be--
              [(A) collected in the same manner as provided for in
            section 106A(d)(2) or 106B(d)(3), as applicable; and
              [(B) enforced in the same manner as provided in
            section 106A(h) or 106B(j), as applicable.
      [(3) The Secretary may enforce this subsection in the courts
    of the United States.

       [PRODUCER CONTRIBUTIONS AND PURCHASER ASSESSMENTS FOR NO NET COST
                                  TOBACCO FUND

      [Sec. 106A. (a) As used in the section--
              [(1) the term ``association'' means a producer-owned
            cooperative marketing association which has entered
            into a loan agreement with the Corporation to make
            price support available to producers;
              [(2) the term ``Corporation'' means the Commodity
            Credit Corporation, an agency and instrumentality of
            the United States within the Department of Agriculture
            through which the Secretary makes price support
            available to producers;
              [(3) the term ``Fund'' means the capital account to
            be established within each association, which account
            shall be known as the ``No Net Cost Tobacco Fund'';
              [(4) the term ``to market'' means to dispose of quota
            tobacco by voluntary or involuntary sale, barter,
            exchange, gift inter vivos, or consigning the tobacco
            to an association for a price support advance;
              [(5) the term ``net gains'' means the amount by which
            total proceeds obtained from the sale by an association
            of a crop of quota tobacco pledged to the Corporation
            for price support loan exceeds the principal amount of
            the price support loan made by the Corporation to the
            association on such crop, plus interest and charges;
              [(6) the term ``purchaser'' means any person who
            purchases in the United States, either directly or
            indirectly for the account of such person or another
            person, Flue-cured or Burley quota tobacco; and
              [(7) the term ``quota tobacco'' means any kind of
            tobacco for which marketing quotas are in effect or for
            which marketing quotas are not disapproved by
            producers.
      [(b) The Secretary may carry out the tobacco price support
    program through the Corporation and shall, except as otherwise
    provided by this section, continue to make price support
    available to producers through loans to associations that,
    under agreements with the Corporation, agree to make loan
    advances to producers.
      [(c) Each association shall establish within the association
    a Fund. The Fund shall be comprised of amounts contributed by
    producer-members or paid by or on behalf of purchasers and
    importers as provided in subsection (d).
      [(d) The Secretary shall--
              [(1) require--
                      [(A) that--
                              [(i) as a condition of eligibility
                            for price support, each producer of
                            each kind of quota tobacco shall agree,
                            with respect to all such kind of quota
                            tobacco marketed by the producer from a
                            farm, to contribute to the appropriate
                            association, for deposit in the
                            association's Fund, an amount
                            determined from time to time by the
                            association with the approval of the
                            Secretary;
                              [(ii) each purchaser of Flue-cured
                            and Burley quota tobacco shall pay to
                            the appropriate association, for
                            deposit in the Fund of the association,
                            an assessment, in an amount determined
                            from time to time by the association
                            with the approval of the Secretary,
                            with respect to purchases of all such
                            kind of tobacco marketed by a producer
                            from a farm (including purchases of
                            such tobacco from the 1986 and
                            subsequent crops from the association);
                            and
                              [(iii) each importer of Flue-cured or
                            Burley tobacco shall pay to the
                            appropriate association, for deposit in
                            the Fund of the association, an
                            assessment, in an amount that is equal
                            to the product obtained by
                            multiplying--
                                      [(I) the number of pounds of
                                    tobacco that is imported by the
                                    importer; by
                                      [(II) the sum of the amount
                                    of per pound producer
                                    contributions and purchaser
                                    assessments that are payable by
                                    domestic producers and
                                    purchasers of Flue-cured and
                                    Burley tobacco under clauses
                                    (i) and (ii); and
                      [(B) that, upon making a contribution under
                    subparagraph (A)--
                              [(i) in the case of quota tobacco
                            marketed other than by consignment to
                            an association for a price support
                            advance, the producer shall receive
                            from the association capital stock or,
                            if the association does not issue such
                            stock, a capital certificate having a
                            par value or face amount, respectively,
                            equal to the contribution; and
                              [(ii) in the case of quota tobacco
                            consigned by the producer to an
                            association for a price support
                            advance, the producer shall receive
                            from the association a qualified per
                            unit retain certificate, as defined in
                            section 1388(h) of the Internal Revenue
                            Code, having a face amount equal to the
                            amount of the contribution and
                            representing an interest in the
                            association's Fund.
            The amount of producer contributions and purchaser
            assessments shall be determined in such a manner that
            producers and purchasers share equally, to the maximum
            extent practicable, in maintaining the Fund of an
            association. In making such determination with respect
            to the assessment of a purchaser, only 1985 and
            subsequent crops of Flue-cured and Burley quota tobacco
            shall be taken into account. The Secretary shall
            approve the amount of the contributions and assessments
            determined by an association from time to time under
            this paragraph only if the Secretary determines that
            such amount will result in accumulation of a Fund
            adequate to reimburse the Corporation for any net
            losses which the Corporation may sustain under its loan
            agreements with the association, based on reasonable
            estimates of the amounts which the Corporation will
            lend to the association under such agreements and the
            proceeds which will be realized from the sales of
            tobacco which are pledged to the Corporation by the
            association as security for loans;
              [(2) require that any producer contribution or
            purchaser or importer assessment due under paragraph
            (1) shall be collected--
                      [(A) from the person who acquired the tobacco
                    involved from the producer, except that if the
                    tobacco is marketed by sale, an amount equal to
                    the producer contribution may be deducted by
                    the purchaser from the price paid to such
                    producer;
                      [(B) if the tobacco involved is marketed by a
                    producer through a warehouseman or agent, from
                    such warehouseman or agent, who may--
                              [(i) deduct an amount equal to the
                            producer contribution from the price
                            paid to the producer; and
                              [(ii) add an amount equal to the
                            purchaser assessment to the price paid
                            by the purchaser;
                      [(C) if the tobacco involved is marketed by a
                    producer directly to any person outside the
                    United States, from the producer, who may add
                    an amount equal to the purchaser assessment to
                    the price paid by the purchaser; and
                      [(D) if the tobacco involved is imported by
                    an importer, from the importer.
              [(3) require that the Fund established by each
            association shall be kept and maintained separate from
            all other accounts of the association and shall be used
            exclusively, as prescribed by the Secretary, for the
            purpose of ensuring, insofar as practicable, that the
            Corporation, under its loan agreements with the
            association with respect to 1982 and subsequent crops
            of quota tobacco, will suffer no net losses (including,
            but not limited to, recovery of the amount of loans
            extended to cover the overhead costs of the
            association), after any net gains are applied to net
            losses of the corporation under paragraph (5):
            Provided, That, notwithstanding any other provision of
            law, use by the association of moneys in the Fund,
            including interest and other earnings, for the purposes
            of reducing the association's outstanding indebtedness
            to the Corporation associated with 1982 and subsequent
            crops of quota tobacco and making loan advances to
            producers is authorized, and use of such moneys for any
            other purposes that will be mutually beneficial to
            producers and purchasers who contribute or pay to the
            Fund and to the Corporation, shall, if approved by the
            Secretary, be considered an appropriate use of the
            Fund;
              [(4) permit an association to invest the monies in
            the Fund in such manner as the Secretary may approve,
            and require that the interest or other earnings on such
            investment shall become a part of the Fund;
              [(5) require that loan agreements between the
            Corporation and the association provide that the
            Corporation shall retain the net gains from each of the
            1982 and subsequent crops of tobacco pledged by the
            association as security for price support loans, and
            that such net gains will be used for the purpose of (A)
            offsetting any losses sustained by the Corporation
            under its loan agreements with the association for any
            of the 1982 and subsequent crops of loan tobacco, or
            (B) reducing the outstanding balance of any price
            support loan made by the Corporation to the association
            under such agreements for 1982 and subsequent crops of
            tobacco, or for both such purposes;
              [(7) effective for the 1986 and subsequent crops of
            quota tobacco, provide, in loan agreements between the
            Corporation and an association, that if the Secretary
            determines that the amount in the Fund or the net gains
            referred to in paragraph (5) exceeds the amounts
            necessary for the purposes specified in this section,
            the association, with the approval of the Secretary,
            may suspend the payment and collection of contributions
            and assessments under this section on terms and
            conditions established by the association, with the
            approval of the Secretary.
      [(e) If any association which has entered into a loan
    agreement with the Corporation with respect to 1982 or
    subsequent crops of quota tobacco fails or refuses to comply
    with the provisions of this section, the regulations issued by
    the Secretary thereunder, or the terms of such agreement, the
    Secretary may terminate such agreement or provide that no
    additional loan funds may be made available thereunder to the
    association. In such event, the Secretary shall make price
    support available to producers of the kind or kinds of tobacco,
    the price of which had been supported through loans to such
    association, through such other means as are authorized by this
    Act or the Commodity Credit Corporation Charter Act.
      [(f) If, under subsection (e), a loan agreement with an
    association is terminated, or if an association having a loan
    agreement with the Corporation is dissolved, merges with
    another association, or otherwise ceases to operate, the Fund
    or the net gains referred to in subsection (d)(5) shall be
    applied or disposed of in such manner as the Secretary may
    approve or prescribe, except that they shall, to the extent
    necessary, first be applied or used for the purposes therefor
    prescribed in this section.
      [(g) The Secretary shall issue regulations necessary to carry
    out the provisions of this section.
      [(h)(1)(A) Each person who fails to collect any contribution
    or assessment as required by subsection (d)(2) and remit such
    contribution or assessment to the association, at such time and
    in such manner as may be prescribed by the Secretary, shall be
    liable, in addition to any amount due, to a marketing penalty
    at a rate equal to 75 percent of the average market price
    (calculated to the nearest whole cent) for the kind of tobacco
    involved for the immediately preceding year on the quantity of
    tobacco as to which the failure occurs.
      [(B) Each importer who fails to pay to the association an
    assessment as required by subsection (d)(2) at such time and in
    such manner as may be prescribed by the Secretary, shall be
    liable, in addition to any amount due, for a marketing penalty
    at a rate equal to 75 percent of the average market price
    (calculated to the nearest whole cent) for the respective kind
    of tobacco for the immediately preceding year on the quantity
    of tobacco as to which the failure occurs.
      [(C) The Secretary may reduce any such marketing penalty in
    such amount as the Secretary determines equitable in any case
    in which the Secretary determines that the failure was
    unintentional or without knowledge on the part of the person
    concerned.
      [(D) Any penalty provided for under this paragraph shall be
    assessed by the Secretary after notice and opportunity for a
    hearing.
      [(2)(A) Any person against whom a penalty is assessed under
    this subsection may obtain review of such penalty in an
    appropriate district court of the United States by filing a
    civil action in such court not later than 30 days after such
    penalty is imposed.
      [(B) The Secretary shall promptly file in such court a
    certified copy of the record on which the penalty is based.
      [(3) The district courts of the United States shall have
    jurisdiction to review and enforce any penalty imposed under
    this subsection.
      [(4) An amount equivalent to any penalty collected by the
    Secretary under this subsection shall be transmitted by the
    Secretary to the appropriate association, for deposit in the
    Fund of such association.
      [(5) The remedies provided in this subsection shall be in
    addition to, and not exclusive of, other remedies that may be
    available.

             [MARKETING ASSESSMENTS TO NO NET COST TOBACCO ACCOUNT

      [Sec. 106B. (a) As used in this section--
              [(1) the term ``association'' means a producer-owned
            cooperative marketing association which has entered
            into a loan agreement with the Corporation to make
            price support available to producers of a kind of
            tobacco;
              [(2) the term ``Account'' means an account
            established by and in the Corporation for an
            association, which account shall be known as the ``No
            Net Cost Tobacco Account'';
              [(3) the term ``to market'' means to dispose of
            tobacco by voluntary or involuntary sale, barter,
            exchange, gift inter vivos, or consigning the tobacco
            to an association for a price support advance;
              [(4) the term ``net gains'' means the amount by which
            total proceeds obtained from the sale by an association
            of a crop of a kind of tobacco pledged to the
            Corporation for price support loan exceeds the
            principal amount of the price support loan made by the
            Corporation to the association on such crop, plus
            interest and charges;
              [(5) the term ``tobacco'' means any kind of tobacco
            as defined in section 301(b)(15) of the Agricultural
            Adjustment Act of 1938, for which marketing quotas are
            in effect or for which marketing quotas are not
            disapproved by producers;
              [(6) the term ``area'', when used in connection with
            an association, means the general geographical area in
            which farms of the producer-members of such association
            are located, as determined by the Secretary;
              [(7) the term ``Corporation'' shall have the meaning
            given to it in section 106A(a)(2); and
              [(8) the term ``purchaser'' means any person who
            purchases in the United States, either directly or
            indirectly for the account of such person or another
            person, Flue-cured or Burley quota tobacco.
      [(b) Notwithstanding section 106A, the Secretary shall, upon
    the request of any association, and may, if the Secretary
    determines, after consultation with such association, that the
    accumulation of the No Net Cost Tobacco Fund for such
    association under section 106A is, and is likely to remain,
    inadequate to reimburse the Corporation for net losses which
    the Corporation sustains under its loan agreement with such
    association--
              [(1) continue to make price support available to
            producers through such association in accordance with
            loan agreements entered into between the Corporation
            and such association; and
              [(2) establish and maintain in accordance with this
            section a No Net Cost Tobacco Account for such
            association in lieu of the No Net Cost Tobacco Fund
            established within such association under section 106A.
      [(c)(1) Any Account established for an association under
    subsection (b)(2) shall be established within the Corporation
    and shall be comprised of amounts paid by producers,
    purchasers, and importers under subsection (d).
      [(2) Upon the establishment of an Account for an association,
    any amount in the No Net Cost Tobacco Fund established within
    such association under section 106A shall be applied or
    disposed of in such manner as the Secretary may approve or
    prescribe, except that such amount shall, to the extent
    necessary, first be applied or used for the purposes therefor
    prescribed in such section.
      [(d)(1)(A) If an Account is established for an association
    under subsection (b)(2), then the Secretary shall require (in
    lieu of any requirement under section 106A(d)(1)) that each
    producer of the kind of tobacco involved whose farm is within
    such association's area shall, as a condition of eligibility
    for price support, agree, with respect to all of such kind of
    tobacco marketed by the producer from the farm, to pay to the
    Corporation, for deposit in such association's Account,
    marketing assessments as determined under paragraph (2) and
    collected under paragraph (3).
      [(B) The Secretary shall also require (in lieu of any
    requirement under section 106A(d)(1)) that each purchaser of
    Flue-cured and Burley quota tobacco shall pay to the
    Corporation, for deposit in the Account of such association, an
    assessment, as determined under paragraph (2) and collected
    under paragraph (3), with respect to purchases of all such kind
    of tobacco marketed by a producer from a farm (including
    purchases of such tobacco from the 1986 and subsequent crops
    from the association).
      [(C) The Secretary shall also require (in lieu of any
    requirement under section 106A(d)(1)) that each importer of
    Flue-cured and Burley tobacco shall pay to the Corporation, for
    deposit in the Account of the association, an assessment, as
    determined under paragraph (2) and collected under paragraph
    (3), with respect to purchases of all such kinds of tobacco
    imported by the importer.
      [(2)(A) For purposes of paragraph (1), the Secretary shall
    determine and adjust from time to time, in consultation with
    such association, the amount of the marketing assessment which
    shall be imposed, as a condition of eligibility for price
    support, on each pound of the kind of tobacco involved marketed
    by a producer from a farm within such association's area and
    the amount of the assessment to be paid by purchasers of
    tobacco. The amount of the assessment to be paid by producers
    and purchasers shall be determined in such a manner that
    producers and purchasers share equally, to the maximum extent
    practicable, in maintaining the Account of an association. In
    making such determination with respect to the assessment of a
    purchaser, only 1985 and subsequent crops of Flue-cured and
    Burley quota tobacco shall be taken into account. The amount of
    the assessment shall be equal to an amount which, when
    collected, will result in an accumulation of an Account for
    such association adequate to reimburse the Corporation for any
    net losses which the Corporation may sustain under its loan
    agreements with such association, based on reasonable estimates
    of the amounts which the Corporation will lend to such
    association under such agreements and the proceeds which will
    be realized from the sales of the kind of tobacco involved
    which are pledged to the Corporation by such association as
    security for loans. Notwithstanding the foregoing provisions of
    this paragraph, the amount of any assessment that is determined
    by the Secretary for the 1986 and subsequent crops of Burley
    quota tobacco shall be determined without regard to any net
    losses that the Corporation may sustain under the loan
    agreements of the Corporation with such association with
    respect to the 1983 crop of such tobacco.
      [(C) The amount of the assessment to be paid by importers
    shall be an amount that is equal to the product obtained by
    multiplying--
              [(i) the number of pounds of tobacco that is imported
            by the importer; by
              [(ii) the sum of the amount of per pound producer and
            purchaser assessments that are payable by domestic
            producers and purchasers of the respective kind of
            tobacco under this paragraph.
      [(3)(A) Except as provided in subparagraphs (B) and (C), any
    assessment to be paid by a producer or a purchaser under
    paragraph (1) shall be collected from the person who acquired
    the tobacco involved from such producer, except that if the
    tobacco is marketed by sale, an amount equal to the producer
    assessment may be deducted by the purchaser from the price paid
    to such producer.
      [(B) If tobacco of the kind for which an Account is
    established is marketed by a producer through a warehouseman or
    agent, both the producer and the purchaser assessment shall be
    collected from such warehouseman or agent, who may--
              [(i) deduct an amount equal to the producer
            assessment from the price paid to the producer; and
              [(ii) add an amount equal to the purchaser assessment
            to the price paid by the purchaser.
      [(C) If tobacco of the kind for which an Account is
    established is marketed by a producer directly to any person
    outside the United States, both the producer and the purchaser
    assessment shall be collected from the producer, who may add an
    amount equal to the purchaser assessment to the price paid by
    the purchaser.
      [(D) If Flue-cured or Burley tobacco is imported by an
    importer, any importer assessment required by subsection (d)
    shall be collected from the importer.
      [(e) Amounts deposited in an Account established for an
    association shall be used by the Secretary for the purpose of
    ensuring, insofar as practicable, that the Corporation under
    its loan agreements with such association will suffer, with
    respect to the crop involved, no net losses (including, but not
    limited to, recovery of the amount of loans extended to cover
    the overhead costs of the association), after any net gains are
    applied to net losses of the Corporation pursuant to subsection
    (h).
      [(f) The Secretary shall provide, in any loan agreement
    between the Corporation and an association for which an Account
    has been established under subsection (b)(2), that if the
    Secretary determines that the amount in such Account or the net
    gains referred to in subsection (h) exceed the amounts
    necessary for the purposes of this section, then the Secretary,
    in consultation with such association, may suspend the payment
    and collection of marketing assessments under this section upon
    terms and conditions established by the Secretary.
      [(g) With respect to any association for which an Account is
    established under subsection (b)(2), if a loan agreement
    between the Corporation and such association is terminated, if
    such association is dissolved or merges with another
    association that has entered into a loan agreement with the
    Corporation to make price support available to producers of the
    kind of tobacco involved, or if such Account terminates by
    operation of law, then amounts in such Account and the net
    gains referred to in subsection (h) shall be applied to or
    disposed of in such manner as the Secretary may prescribe,
    except that they shall, to the extent necessary, first be
    applied to or used for the purposes therefor prescribed in this
    section.
      [(h) The provisions of section 106A(d)(5) relating to net
    gains shall apply to any loan agreement between an association
    and the Corporation entered into upon or after the
    establishment of an Account for such association under
    subsection (b)(2).
      [(i) The Secretary shall issue regulations necessary to carry
    out the provisions of this section.
      [(j)(1)(A) Each person who fails to collect any assessment as
    required by subsection (d)(3) and remit such assessment to the
    Corporation, at such time and in such manner as may be
    prescribed by the Secretary, shall be liable, in addition to
    any amount due, to a marketing penalty at a rate equal to 75
    percent of the average market price (calculated to the nearest
    whole cent) for the kind of tobacco involved for the
    immediately preceding year on the quantity of tobacco as to
    which the failure occurs.
      [(B) Each importer who fails to pay to the Corporation an
    assessment as required by subsection (d) at such time and in
    such manner as may be prescribed by the Secretary, shall be
    liable, in addition to any amount due, to a marketing penalty
    at a rate equal to 75 percent of the average market price
    (calculated to the nearest whole cent) for the respective kind
    of tobacco for the immediately preceding year on the quantity
    of tobacco as to which the failure occurs.
      [(C) The Secretary may reduce any such marketing penalty in
    such amount as the Secretary determines equitable in any case
    in which the Secretary determines that the failure was
    unintentional or without knowledge on the part of the person
    concerned.
      [(D) Any penalty provided for under this paragraph shall be
    assessed by the Secretary after notice and opportunity for a
    hearing.
      [(2)(A) Any person against whom a penalty is assessed under
    this subsection may obtain review of such penalty in an
    appropriate district court of the United States by filing a
    civil action in such court not later than 30 days after such
    penalty is imposed.
      [(B) The Secretary shall promptly file in such court a
    certified copy of the record on which the penalty is based.
      [(3) The district courts of the United States shall have
    jurisdiction to review and enforce any penalty imposed under
    this subsection.
      [(4) An amount equivalent to any penalty collected by the
    Secretary under this subsection shall be transmitted by the
    Secretary to the Corporation, for deposit in the Account of the
    appropriate association.
      [(5) The remedies provided in this subsection shall be in
    addition to, and not exclusive of, other remedies that may be
    available.
      [Sec. 107. Notwithstanding the provisions of section 101 of
    this Act, beginning with the 1964 crop--
              [(1) Price support for wheat accompanied by domestic
            certificates shall be at such level not less than 65
            per centum or more than 90 per centum of the parity
            price therefor as the Secretary determines appropriate,
            taking into consideration the factors specified in
            section 401(b).
              [(2) Price support for wheat accompanied by export
            certificates shall be at such level not more than 90
            per centum of the parity price therefor as the
            Secretary determines appropriate, taking into
            consideration the factors specified in section 401(b).
              [(3) Price support for wheat not accompanied by
            marketing certificates shall be at such level, not in
            excess of 90 per centum of the parity price therefor,
            as the Secretary determines appropriate, taking into
            consideration competitive world prices of wheat, the
            feeding value of wheat in relation to feed grains, and
            the level at which price support is made available for
            feed grains.
              [(4) Price support shall be made available only to
            cooperators: and, if a commercial wheat-producing area
            is established for such crop, price support shall be
            made available only in the commercial wheat-producing
            area.
              [(5) Effective with respect to crops planted for
            harvest in the calendar year 1966 and any subsequent
            year, the level of price support for any crop of wheat
            for which a national marketing quota is not proclaimed
            or for which marketing quotas have been disapproved by
            producers shall be as provided in section 101.
              [(6) A ``cooperator'' with respect to any crop of
            wheat produced on a farm shall be a producer who (i)
            does not knowingly exceed (A) the farm acreage
            allotment for wheat on the farm or (B) except as the
            Secretary may by regulation prescribe, the farm acreage
            allotment for wheat on any other farm on which the
            producer shares in the production of wheat, and (ii)
            complies with the land-use requirements of section 339
            of the Agricultural Adjustment Act of 1938, as amended,
            to the extent prescribed by the Secretary. Effective
            with respect to crops planted for harvest in the
            calendar year 1966 and any subsequent year, if
            marketing quotas are not in effect for the crop of
            wheat, a ``cooperator'' with respect to any crop of
            wheat produced on a farm shall be a producer who does
            not knowingly exceed the farm acreage allotment for
            wheat. No producer shall be deemed to have exceeded a
            farm acreage allotment for wheat if the entire amount
            of the farm marketing excess is delivered to the
            Secretary or stored in accordance with applicable
            regulations to avoid or postpone payment of the
            penalty, but the producer shall not be eligible to
            receive price support on such marketing excess. No
            producer shall be deemed to have exceeded the farm
            acreage allotment for wheat on any other farm, if such
            farm is exempt from the marketing quota for such crop
            under section 335. No producer shall be deemed to have
            exceeded a farm acreage allotment for wheat if the
            production on the acreage in excess of the farm acreage
            allotment is stored pursuant to the provisions of
            section 379c(b), but the producer shall not be eligible
            to receive support on the wheat so stored.

    [SEC. 107B. LOANS, PAYMENTS, AND ACREAGE REDUCTION PROGRAMS FOR THE
                        1991 THROUGH 1995 CROPS OF WHEAT.

      [(a) Loans and Purchases.--
              [(1) In general.--Except as otherwise provided in
            this subsection, the Secretary shall make available to
            producers on a farm loans and purchases for each of the
            1991 through 1995 crops of wheat produced on the farm
            at such level as the Secretary determines will maintain
            the competitive relationship of wheat to other grains
            in domestic and export markets after taking into
            consideration the cost of producing wheat, supply and
            demand conditions, and world prices for wheat.
              [(2) Minimum loan and purchase level.--Except as
            provided in paragraphs (3) and (4), the loan and
            purchase level determined under paragraph (1) shall not
            be less than 85 percent of the simple average price
            received by producers of wheat, as determined by the
            Secretary, during the marketing years for the
            immediately preceding 5 crops of wheat, excluding the
            year in which the average price was the highest and the
            year in which the average price was the lowest in such
            period, except that the loan and purchase level for a
            crop determined under this paragraph may not be reduced
            by more than 5 percent from the level determined for
            the preceding crop.
              [(3) Adjustments to support level.--
                      [(A) Stocks to use ratio.--If the Secretary
                    estimates for any marketing year that the ratio
                    of ending stocks of wheat to total use for the
                    marketing year will be--
                              [(i) equal to or greater than 30
                            percent, the Secretary may reduce the
                            loan and purchase level for wheat for
                            the corresponding crop by an amount not
                            to exceed 10 percent in any year;
                              [(ii) less than 30 percent but not
                            less than 15 percent, the Secretary may
                            reduce the loan and purchase level for
                            wheat for the corresponding crop by an
                            amount not to exceed 5 percent in any
                            year; or
                              [(iii) less than 15 percent, the
                            Secretary may not reduce the loan and
                            purchase level for wheat for the
                            corresponding crop.
                      [(B) Report to congress.--
                              [(i) In general.--If the Secretary
                            adjusts the level of loans and
                            purchases for wheat under subparagraph
                            (A), 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--
                                      [(I) certifying such
                                    adjustment as necessary to
                                    prevent the accumulation of
                                    stocks and to retain market
                                    share; and
                                      [(II) containing a
                                    description of the need for
                                    such adjustment.
                              [(ii) Effective date of adjustment.--
                            The adjustment shall become effective
                            no earlier than 60 calendar days after
                            the date of submission of the report to
                            the Committees, except that in the case
                            of the 1991 crop of wheat, the
                            adjustment shall become effective on
                            the date of the submission of the
                            report.
                      [(C) Competitive position.--Notwithstanding
                    subparagraph (A), if the Secretary determines,
                    not later than 60 days prior to the beginning
                    of a marketing year for a crop, that the
                    effective loan rate established for such crop
                    will not maintain a competitive market position
                    for wheat, the Secretary may reduce the loan
                    and purchase level for wheat for the marketing
                    year by an amount, in addition to any reduction
                    under subparagraph (A), not to exceed 10
                    percent in any year.
                      [(D) No effect on future years.--Any
                    reduction in the loan and purchase level for
                    wheat under this paragraph shall not be
                    considered in determining the loan and purchase
                    level for wheat for subsequent years.
                      [(E) Minimum loan rate.--Notwithstanding
                    subparagraph (A), the loan rate for wheat shall
                    not be less than $2.44 per bushel, unless such
                    rate would exceed 80 percent of the 5-year
                    average market price determination.
              [(4) Marketing loan provisions.--
                      [(A) In general.--The Secretary may permit a
                    producer to repay a loan made under this
                    subsection for a crop at a level (except as
                    provided in subparagraph (C)) that is the
                    lesser of--
                              [(i) the loan level determined for
                            the crop;
                              [(ii) the higher of--
                                      [(I) 70 percent of such
                                    level;
                                      [(II) if the loan level for a
                                    crop was reduced under
                                    paragraph (3), 70 percent of
                                    the loan level that would have
                                    been in effect but for the
                                    reduction under paragraph (3);
                                    or
                              [(iii) the prevailing world market
                            price for wheat (adjusted to United
                            States quality and location), as
                            determined by the Secretary.
                      [(B) Prevailing world market price.--If the
                    Secretary permits a producer to repay a loan in
                    accordance with subparagraph (A), the Secretary
                    shall prescribe by regulation--
                              [(i) a formula to determine the
                            prevailing world market price for
                            wheat, adjusted to United States
                            quality and location; and
                              [(ii) a mechanism by which the
                            Secretary shall announce periodically
                            the prevailing world market price for
                            wheat.
                      [(C) Alternative repayment rates.--For each
                    of the 1991 through 1995 crops of wheat, if the
                    world market price for wheat (adjusted to
                    United States quality and location) as
                    determined by the Secretary, is less than the
                    loan level determined for the crop, the
                    Secretary may permit a producer to repay a loan
                    made under this subsection for a crop at such
                    level (not in excess of the loan level
                    determined for the crop) as the Secretary
                    determines will--
                              [(i) minimize potential loan
                            forfeitures;
                              [(ii) minimize the accumulation of
                            wheat stocks by the Federal Government;
                              [(iii) minimize the cost incurred by
                            the Federal Government in storing
                            wheat; and
                              [(iv) allow wheat produced in the
                            United States to be marketed freely and
                            competitively, both domestically and
                            internationally.
              [(5) Simple average price.--For purposes of this
            section, the simple average price received by producers
            for the immediately preceding marketing year shall be
            based on the latest information available to the
            Secretary at the time of the determination.
      [(b) Loan Deficiency Payments.--
              [(1) In general.--The Secretary may, for each of the
            1991 through 1995 crops of wheat, make payments
            (hereafter in this section referred to as ``loan
            deficiency payments'') available to producers who,
            although eligible to obtain a loan or purchase
            agreement under subsection (a), agree to forgo
            obtaining the loan or agreement in return for payments
            under this subsection.
              [(2) Computation.--A payment under this subsection
            shall be computed by multiplying--
                      [(A) the loan payment rate; by
                      [(B) the quantity of wheat the producer is
                    eligible to place under loan (or obtain a
                    purchase agreement) but for which the producer
                    forgoes obtaining the loan or agreement in
                    return for payments under this subsection.
              [(3) Loan payment rate.--For purposes of this
            subsection, the loan payment rate shall be the amount
            by which--
                      [(A) the loan level determined for the crop
                    under subsection (a); exceeds
                      [(B) the level at which a loan may be repaid
                    under subsection (a).
      [(c) Payments.--
              [(1) Deficiency payments.--
                      [(A) In general.--The Secretary shall make
                    available to producers payments (hereafter in
                    this section referred to as ``deficiency
                    payments'') for each of the 1991 through 1995
                    crops of wheat in an amount computed by
                    multiplying--
                              [(i) the payment rate; by
                              [(ii) the payment acres for the crop;
                            by
                              [(iii) the farm program payment yield
                            established for the crop for the farm.
                      [(B) Payment rate.--
                              [(i) Payment rate for 1991 through
                            1993 crops.--The payment rate for each
                            of the 1991 through 1993 crops of wheat
                            shall be the amount by which the
                            established price for the crop of wheat
                            exceeds the higher of--
                                      [(I) the national weighted
                                    average market price received
                                    by producers during the first 5
                                    months of the marketing year
                                    for the crop, as determined by
                                    the Secretary; or
                                      [(II) the loan level
                                    determined for the crop, prior
                                    to any adjustment made under
                                    subsection (a)(3) for the
                                    marketing year for the crop of
                                    wheat.
                              [(ii) Payment rate of 1994 and 1995
                            crops.--The payment rate for each of
                            the 1994 and 1995 crops of wheat shall
                            be the amount by which the established
                            price for the crop of wheat exceeds the
                            higher of--
                                      [(I) the lesser of--
                                              [(aa) the national
                                            weighted average market
                                            price received by
                                            producers during the
                                            marketing year for the
                                            crop, as determined by
                                            the Secretary; or
                                              [(bb) the national
                                            weighted average market
                                            price received by
                                            producers during the
                                            first 5 months of the
                                            marketing year for the
                                            crop, as determined by
                                            the Secretary, plus 10
                                            cents per bushel; or
                                      [(II) the loan level
                                    determined for the crop, prior
                                    to any adjustment made under
                                    subsection (a)(3) for the
                                    marketing year for the crop of
                                    wheat.
                              [(iii) Minimum established price.--
                            The established price for wheat shall
                            not be less than $4.00 per bushel for
                            each of the 1991 through 1995 crops.
                      [(C) Payment acres.--Payment acres for a crop
                    shall be the lesser of--
                              [(i) the number of acres planted to
                            the crop for harvest within the
                            permitted acreage; or
                              [(ii) 85 percent of the crop acreage
                            base for the crop for the farm less the
                            quantity of reduced acreage (as
                            determined under subsection (e)(2)(D)).
                      [(D) Emergency compensation.--
                              [(i) In general.--Notwithstanding the
                            foregoing provisions of this section,
                            if the Secretary adjusts the level of
                            loans and purchases for wheat under
                            subsection (a)(3), the Secretary shall
                            provide emergency compensation by
                            increasing the deficiency payments for
                            wheat by such amount as the Secretary
                            determines necessary to provide the
                            same total return to producers as if
                            the adjustment in the level of loans
                            and purchases had not been made.
                              [(ii) Calculation.--In determining
                            the payment rate, per bushel, for
                            emergency compensation payments for a
                            crop of wheat under this subparagraph,
                            the Secretary shall use the national
                            weighted average market price, per
                            bushel of wheat, received by producers
                            during the marketing year for the crop,
                            as determined by the Secretary.
                              [(iii) Deadlines for estimates and
                            availability.--Notwithstanding any
                            other provision of this Act, the
                            Secretary shall--
                                      [(I) by December 1 of the
                                    marketing year for the crop,
                                    estimate the national weighted
                                    average market price, per
                                    bushel of wheat, received by
                                    producers during the marketing
                                    year;
                                      [(II) by December 15 of the
                                    marketing year, use the
                                    estimate to make available to
                                    producers who have elected the
                                    payment option authorized by
                                    this clause not less than 75
                                    percent of the increase in
                                    payments estimated to be
                                    payable with respect to the
                                    crop under this subparagraph;
                                    and
                                      [(III) adjust the amount of
                                    each final payment for wheat to
                                    reflect any difference between
                                    the amount of any estimated
                                    payment made under this clause
                                    and the amount of actual
                                    payment due under this
                                    subparagraph.
                              [(iv) Time for electing payment
                            option.--Producers shall elect the
                            payment option authorized by clause
                            (iii) at the time of entering into a
                            contract to participate in the program
                            established by this section for the
                            crop.
                      [(E) 0/85 program.--
                              [(i) In general.--If an acreage
                            limitation program under subsection
                            (e)(2) is in effect for a crop of wheat
                            and the producers on a farm devote a
                            portion of the maximum payment acres
                            for wheat as calculated under
                            subparagraph (C)(ii) of the farm equal
                            to more than 8 percent for each of the
                            1991 through 1993 crops, and 15 percent
                            for each of the 1994 through 1997 crops
                            (except as provided in clause (vii)),
                            of such wheat acreage of the farm for
                            the crop to conservation uses (except
                            as provided in subparagraph (F))--
                                      [(I) such portion of the
                                    maximum payment acres in excess
                                    of 8 percent for each of the
                                    1991 through 1993 crops, and 15
                                    percent for each of the 1994
                                    through 1997 crops (except as
                                    provided in clause (vii)), of
                                    such acreage devoted to
                                    conservation uses (except as
                                    provided in subparagraph (F))
                                    shall be considered to be
                                    planted to wheat for the
                                    purpose of determining the
                                    acreage on the farm required to
                                    be devoted to conservation uses
                                    in accordance with subsection
                                    (e)(2)(D); and
                                      [(II) the producers shall be
                                    eligible for payments under
                                    this paragraph with respect to
                                    such acreage.
                              [(ii) Deficiency payments.--
                            Notwithstanding any other provision of
                            this section, any producer who devotes
                            a portion of the maximum payment acres
                            for wheat for the farm to conservation
                            uses (or other uses as provided in
                            subparagraph (F)) under this
                            subparagraph shall receive deficiency
                            payments on the acreage that is
                            considered to be planted to wheat and
                            eligible for payments under this
                            subparagraph for the crop at a per-
                            bushel rate established by the
                            Secretary, except that the rate may not
                            be established at less than the
                            projected deficiency payment rate for
                            the crop, as determined by the
                            Secretary. Such projected payment rate
                            for the crop shall be announced by the
                            Secretary prior to the period during
                            which wheat producers may agree to
                            participate in the program for the
                            crop.
                              [(iii) Adverse effect on agribusiness
                            and other interests.--The Secretary
                            shall implement this subparagraph in
                            such a manner as to minimize the
                            adverse effect on agribusiness and
                            other agriculturally related economic
                            interests within any county, State, or
                            region. In carrying out this
                            subparagraph, the Secretary is
                            authorized to restrict the total
                            quantity of wheat acreage that may be
                            taken out of production under this
                            subparagraph, taking into consideration
                            the total quantity of acreage that has
                            or will be removed from production
                            under other price support, production
                            adjustment, or conservation program
                            activities. No restrictions on the
                            quantity of acreage that may be taken
                            out of production in accordance with
                            this subparagraph in a crop year shall
                            be imposed in the case of a county in
                            which producers were eligible to
                            receive disaster emergency loans under
                            section 321 of the Consolidated Farm
                            and Rural Development Act (7 U.S.C.
                            1961) as a result of a disaster that
                            occurred during the crop year.
                              [(iv) Crop acreage and payment
                            yield.--The wheat crop acreage base and
                            wheat farm program payment yield of the
                            farm shall not be reduced due to the
                            fact that a portion of the permitted
                            wheat acreage of the farm was devoted
                            to conserving uses (except as provided
                            in subparagraph (F)) under this
                            subparagraph.
                              [(v) Limitation.--Other than as
                            provided in clauses (i) through (iv),
                            payments may not be made under this
                            paragraph for any crop on a greater
                            acreage than the acreage actually
                            planted to wheat.
                              [(vi) Conservation use acreage under
                            other programs.--Any acreage considered
                            to be planted to wheat in accordance
                            with clauses (i) and (iv) may not also
                            be designated as conservation use
                            acreage for the purpose of fulfilling
                            any provisions under any acreage
                            limitation or land diversion program
                            requiring that the producers devote a
                            specified acreage to conservation uses.
                              [(vii) Exceptions to 0/85.--In the
                            case of each of the 1994 through 1997
                            crops of wheat, producers on a farm
                            shall be eligible to receive deficiency
                            payments as provided in clause (ii) if
                            an acreage limitation program under
                            subsection (e) is in effect for the
                            crop and--
                                      [(I)(aa) the producers have
                                    been determined by the
                                    Secretary (in accordance with
                                    section 503(c)) to be prevented
                                    from planting the crop or have
                                    incurred a reduced yield for
                                    the crop (due to a natural
                                    disaster); and
                                      [(bb) the producers elect to
                                    devote a portion of the maximum
                                    payment acres for wheat (as
                                    calculated under subparagraph
                                    (C)(ii)) equal to more than 8
                                    percent of the wheat acreage,
                                    to conservation uses; or
                                      [(II) the producers elect to
                                    devote a portion of the maximum
                                    payment acres for wheat (as
                                    calculated under subparagraph
                                    (C)(ii)) equal to more than 8
                                    percent of the wheat acreage,
                                    to alternative crops as
                                    provided in subparagraph (F).
                      [(F) Alternative crops.--
                              [(i) Industrial and other crops.--The
                            Secretary may permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any part of
                            acreage otherwise required to be
                            devoted to conservation uses as a
                            condition of qualifying for payments
                            under subparagraph (E) to be devoted to
                            sweet sorghum, guar, castor beans,
                            plantago ovato, triticale, rye, millet,
                            mung beans, commodities for which no
                            substantial domestic production or
                            market exists but that could yield
                            industrial raw material being imported,
                            or likely to be imported, into the
                            United States, or commodities grown for
                            experimental purposes (including kenaf
                            and milkweed), subject to the following
                            sentence. The Secretary may permit the
                            acreage to be devoted to the production
                            only if the Secretary determines that--
                                      [(I) the production is not
                                    likely to increase the cost of
                                    the price support program; and
                                      [(II) the production is
                                    needed to provide an adequate
                                    supply of the commodity, or, in
                                    the case of commodities for
                                    which no substantial domestic
                                    production or market exists but
                                    that could yield industrial raw
                                    materials, the production is
                                    needed to encourage domestic
                                    manufacture of the raw material
                                    and could lead to increased
                                    industrial use of the raw
                                    material to the long-term
                                    benefit of United States
                                    industry.
                              [(ii) Oilseeds.--The Secretary shall
                            permit, subject to such terms and
                            conditions as the Secretary may
                            prescribe, all or any part of acreage
                            otherwise required to be devoted to
                            conservation uses as a condition of
                            qualifying for payments under
                            subparagraph (E) to be devoted to
                            sunflowers, rapeseed, canola,
                            safflower, flaxseed, mustard seed,
                            sesame, crambe, and other minor oilseed
                            designated by the Secretary (excluding
                            soybeans). In implementing this clause,
                            the Secretary shall provide that, in
                            order to receive payments under
                            subparagraph (E), the producers shall
                            agree to forgo eligibility to receive a
                            loan under section 205 for the crop of
                            any such oilseed produced on the farm.
                              [(iii) Double cropping.--The
                            Secretary shall permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any portion of
                            the acreage otherwise required to be
                            devoted to conservation uses as a
                            condition of qualifying for payments
                            under subparagraph (E) that is devoted
                            to an industrial, oilseed, or other
                            crop pursuant to clause (i) or (ii) to
                            be subsequently planted during the same
                            crop year to any crop described in
                            subparagraph (B), (C), or (D) of
                            section 504(b)(1). The planting of
                            soybeans as such subsequently planted
                            crop shall be limited to farms
                            determined by the Secretary to have an
                            established history of double cropping
                            soybeans during at least 3 of the
                            preceding 5 years. In implementing this
                            clause, the Secretary shall require
                            producers to agree to forego
                            eligibility to receive loans under this
                            Act for the crop of the subsequently
                            planted crop that is produced on a farm
                            under this clause.
              [(2) Crop insurance requirement.--A producer shall
            obtain catastrophic risk protection insurance coverage
            in accordance with section 427.
      [(d) Payment Yields.--The farm program payment yields for
    farms for each crop of wheat shall be determined under title V.
      [(e) Acreage Reduction Programs.--
              [(1) In general.--
                      [(A) Establishment.--Notwithstanding any
                    other provision of this Act, if the Secretary
                    determines that the total supply of wheat, in
                    the absence of an acreage limitation program,
                    will be excessive taking into account the need
                    for an adequate carry-over to maintain
                    reasonable and stable supplies and prices and
                    to meet a national emergency, the Secretary may
                    provide for any crop of wheat an acreage
                    limitation program as described in paragraph
                    (2).
                      [(B) Agricultural resources conservation
                    program.--In making a determination under
                    subparagraph (A), the Secretary shall take into
                    consideration the number of acres placed in the
                    agricultural resources conservation program
                    established under subtitle D of title XII of
                    the Food Security Act of 1985 (16 U.S.C. 3831
                    et seq.).
                      [(C) Announcements.--If the Secretary elects
                    to implement an acreage limitation program for
                    any crop year, the Secretary shall announce any
                    such program not later than June 1 prior to the
                    calendar year in which the crop is harvested,
                    except that in the case of the 1991 crop, the
                    Secretary shall announce the program as soon as
                    practicable after the date of enactment of this
                    section.
                      [(D) Adjustments.--Not later than July 31 of
                    the year previous to the year in which the crop
                    is harvested, the Secretary may make
                    adjustments in the program announced under
                    subparagraph (C) if the Secretary determines
                    that there has been a significant change in the
                    total supply of wheat since the program was
                    first announced.
                      [(E) Compliance.--As a condition of
                    eligibility for loans, purchases, and payments
                    for any such crop of wheat, except as provided
                    in subsections (f) and (g) and section 504, the
                    producers on a farm must comply with the terms
                    and conditions of the acreage limitation
                    program and, if applicable, a land diversion
                    program as provided in paragraph (5).
                      [(F) Acreage limitation program for 1991
                    crop.--In the case of the 1991 crop of wheat,
                    the Secretary shall provide for an acreage
                    limitation program (as described in paragraph
                    (2)) under which the acreage planted to wheat
                    for harvest on a farm would be limited to the
                    wheat crop acreage base for the farm for the
                    crop reduced by not less than 15 percent.
                      [(G) Acreage limitation programs for 1992
                    through 1995 crops.--In the case of each of the
                    1992 through 1995 crops of wheat, if the
                    Secretary estimates for a marketing year for
                    the crop that the ratio of ending stocks of
                    wheat to total disappearance of wheat for the
                    preceding marketing year will be--
                              [(i) more than 40 percent, the
                            Secretary shall provide for an acreage
                            limitation program (as described in
                            paragraph (2)) under which the acreage
                            planted to wheat for harvest on a farm
                            would be limited to the wheat crop
                            acreage base for the farm for the crop
                            reduced by not less than 10 percent nor
                            more than 20 percent; or
                              [(ii) equal to or less than 40
                            percent, the Secretary may provide for
                            such an acreage limitation program
                            under which the acreage planted to
                            wheat for harvest on a farm would be
                            limited to the wheat crop acreage base
                            for the farm for the crop reduced by
                            not more than 0 to 15 percent.
                    For the purpose of this subparagraph, the term
                    ``total disappearance'' means all wheat
                    utilization, including total domestic, total
                    export, and total residual disappearance.
              [(2) Acreage limitation program.--
                      [(A) Percentage reductions.--Except as
                    provided in paragraph (3), if a wheat acreage
                    limitation program is announced under paragraph
                    (1), such limitation shall be achieved by
                    applying a uniform percentage reduction (from 0
                    to 20 percent) to the wheat crop acreage base
                    for the crop for each wheat-producing farm.
                      [(B) Compliance.--Except as provided in
                    subsection (g) and section 504, producers who
                    knowingly produce wheat in excess of the
                    permitted wheat acreage for the farm shall be
                    ineligible for wheat loans, purchases, and
                    payments with respect to that farm.
                      [(C) Crop acreage bases.--Wheat crop acreage
                    bases for each crop of wheat shall be
                    determined under title V.
                      [(D) Acreage devoted to conservation uses.--A
                    number of acres on the farm shall be devoted to
                    conservation uses, in accordance with
                    regulations issued by the Secretary. Such
                    number shall be determined by multiplying the
                    wheat crop acreage base by the percentage
                    reduction required by the Secretary. The number
                    of acres so determined is hereafter in this
                    subsection referred to as ``reduced acreage''.
                    The remaining acreage is hereafter in this
                    subsection referred to as ``permitted
                    acreage''. Permitted acreage may be adjusted by
                    the Secretary as provided in paragraph (3) and
                    in section 504.
                      [(E) Individual farm program acreage.--Except
                    as otherwise provided in subsection (c), the
                    individual farm program acreage shall be the
                    acreage planted on the farm to wheat for
                    harvest within the permitted wheat acreage for
                    the farm as established under this paragraph.
                      [(F) Planting designated crops on reduced
                    acreage.--
                              [(i) Definition of designated crop.--
                            As used in this subparagraph, the term
                            ``designated crop'' means a crop
                            defined in section 504(b)(1), excluding
                            any program crop as defined in section
                            502(3).
                              [(ii) In general.--Subject to clause
                            (iii), the Secretary may permit
                            producers on a farm to plant a
                            designated crop on no more than one-
                            half of the reduced acreage on the
                            farm.
                              [(iii) Limitations.--If the producers
                            on a farm elect to plant a designated
                            crop on reduced acreage under this
                            subparagraph--
                                      [(I) the amount of the
                                    deficiency payment that the
                                    producers are otherwise
                                    eligible to receive under
                                    subsection (c) shall be
                                    reduced, for each acre (or
                                    portion thereof) that is
                                    planted to the designated crop,
                                    by an amount equal to the
                                    deficiency payment that would
                                    be made with respect to a
                                    number of acres of the crop
                                    that the Secretary considers
                                    appropriate, except that if the
                                    producers on the farm are
                                    participating in a program
                                    established for more than one
                                    program crop, the amount of the
                                    reduction shall be determined
                                    by prorating the reduction
                                    based on the acreage planted or
                                    considered planted on the farm
                                    to all of such program crops;
                                    and
                                      [(II) the Secretary shall
                                    ensure that reductions in
                                    deficiency payments under
                                    subclause (I) are sufficient to
                                    ensure that this subparagraph
                                    will result in no additional
                                    cost to the Commodity Credit
                                    Corporation.
              [(3) Targeted option payments.--
                      [(A) In general.--Notwithstanding any other
                    provision of this section, if the Secretary
                    implements an acreage limitation program with
                    respect to any of the 1991 through 1995 crops
                    of wheat, the Secretary may make available to
                    producers on a farm who do not receive payments
                    under subsection (c)(1)(E) for such crop on the
                    farm, adjustments in the level of deficiency
                    payments that would otherwise be made available
                    to the producers if the producers exercise the
                    payment options provided in this paragraph.
                      [(B) Payment options.--If the Secretary
                    elects to carry out this paragraph, the
                    Secretary shall make the payment options
                    specified in subparagraphs (C) and (D)
                    available to producers who agree to make
                    adjustments in the quantity of acreage diverted
                    from the production of wheat under an acreage
                    limitation program in accordance with this
                    paragraph.
                      [(C) Increased acreage limitation option.--
                              [(i) Increase in established price.--
                            If the Secretary elects to carry out
                            this paragraph, a producer shall be
                            eligible to receive an increase in the
                            established price for wheat under
                            clause (ii) if the producer agrees to
                            an increase in the acreage limitation
                            percentage to be applied to the
                            producers' wheat acreage base above the
                            acreage limitation percentage announced
                            by the Secretary.
                              [(ii) Method of calculation.--For the
                            purposes of calculating deficiency
                            payments to be made available to
                            producers who participate in the
                            program under this paragraph, the
                            Secretary shall increase the
                            established price for wheat by an
                            amount determined by the Secretary, but
                            not less than 0.5 percent, nor more
                            than 1 percent, for each 1 percentage
                            point increase in the acreage
                            limitation percentage applied to the
                            producers' wheat acreage base.
                              [(iii) Limitation.--The acreage
                            limitation percentage to be applied to
                            the producers' wheat acreage base shall
                            not be increased by more than 10
                            percentage points for the 1991 crop and
                            15 percentage points for each of the
                            1992 through 1995 crops above the
                            acreage limitation percentage announced
                            by the Secretary for the crop or above
                            25 percent total for the crop.
                      [(D) Decreased acreage limitation option.--
                              [(i) Decrease in acreage limitation
                            requirement.--If the Secretary elects
                            to carry out this paragraph, a producer
                            shall be eligible to decrease the
                            acreage limitation percentage
                            applicable to the producers' wheat
                            acreage base (as announced by the
                            Secretary) if the producer agrees to a
                            decrease in the established price for
                            wheat under clause (ii) for the purpose
                            of calculating deficiency payments to
                            be made available to the producer.
                              [(ii) Method of calculation.--For the
                            purposes of calculating deficiency
                            payments to be made available to
                            producers who choose the option set
                            forth in this subparagraph, the
                            Secretary shall decrease the
                            established price for wheat by an
                            amount to be determined by the
                            Secretary, but not less than 0.5
                            percent, nor more than 1 percent, for
                            each 1 percentage point decrease in the
                            acreage limitation percentage applied
                            to the producers' wheat acreage base.
                              [(iii) Limitation.--A producer may
                            not choose to decrease the acreage
                            limitation percentage applicable to the
                            producers' wheat acreage base under
                            this paragraph by more than one-half of
                            the announced acreage limitation
                            percentage.
                      [(E) Participation and production effects.--
                    Notwithstanding any other provision of this
                    paragraph, the Secretary shall, to the extent
                    practicable, ensure that the program provided
                    for in this paragraph does not have a
                    significant effect on program participation or
                    total production and shall be offered in such a
                    manner that the Secretary determines will
                    result in no additional budget outlays. The
                    Secretary shall provide an analysis of the
                    Secretary's determination to the Committee on
                    Agriculture of the House of Representatives and
                    the Committee on Agriculture, Nutrition, and
                    Forestry of the Senate.
              [(4) Administration.--
                      [(A) Protection from weeds and erosion.--The
                    regulations issued by the Secretary under
                    paragraph (2) with respect to acreage required
                    to be devoted to conservation uses shall assure
                    protection of the acreage from weeds and wind
                    and water erosion.
                      [(B) Annual or perennial cover.--
                              [(i) Required.--
                                      [(I) In general.--Except as
                                    provided in subclause (II) and
                                    paragraph (2), a producer who
                                    participates in an acreage
                                    reduction program established
                                    for a crop of wheat under this
                                    subsection shall be required to
                                    plant to, or maintain as, an
                                    annual or perennial cover 50
                                    percent (or more at the option
                                    of the producer) of the acreage
                                    that is required to be removed
                                    from the production of wheat,
                                    but not to exceed 5 percent (or
                                    more at the option of the
                                    producer) of the crop acreage
                                    base established for the crop.
                                      [(II) Arid areas.--Subclause
                                    (I) shall not apply with
                                    respect to arid areas
                                    (including summer fallow
                                    areas), as determined by the
                                    Secretary. If the Secretary
                                    determines any county in a
                                    State to be arid, the
                                    respective State committee
                                    established under section 8(b)
                                    of the Soil Conservation and
                                    Domestic Allotment Act (16
                                    U.S.C. 590h(b)) may designate
                                    any other county or counties or
                                    all of the State as arid for
                                    the purposes of this paragraph.
                                      [(III) Approval of cover
                                    crops and practices.--The State
                                    committee, after receiving
                                    recommendations from the county
                                    committees, shall approve
                                    appropriate crops planted or
                                    maintained as cover, including,
                                    as appropriate, annual or
                                    perennial native grasses and
                                    legumes or other vegetation.
                                    The State committee shall
                                    establish the final seeding
                                    date for the planting of the
                                    cover and shall approve
                                    appropriate cover crops or
                                    practices, after consulting the
                                    Soil Conservation Service State
                                    Conservationist regarding
                                    whether the crops or practices
                                    will sufficiently protect the
                                    land from weeds and wind and
                                    water erosion. After the
                                    Secretary establishes the State
                                    technical committee for the
                                    State pursuant to section 1261
                                    of the Food Security Act of
                                    1985 (16 U.S.C. 3861), the
                                    State committee shall consult
                                    with the technical committee
                                    (rather than the Soil
                                    Conservation Service State
                                    Conservationist) regarding
                                    whether the crops or practices
                                    will sufficiently protect the
                                    land from weeds and wind and
                                    water erosion.
                              [(ii) Multiyear program.--
                                      [(I) Cost-share assistance.--
                                    If a producer elects to
                                    establish a perennial cover
                                    capable of improving water
                                    quality or wildlife habitat on
                                    the acreage, the Commodity
                                    Credit Corporation shall make
                                    available cost-share assistance
                                    for 25 percent of the approved
                                    cost of establishing the cover
                                    on not more than 50 percent of
                                    the acreage that is required to
                                    be diverted from production,
                                    but not to exceed 5 percent (or
                                    more, at the option of the
                                    producer) of the crop acreage
                                    base established for a crop.
                                      [(II) Agreement of
                                    producer.--If a producer elects
                                    to establish a perennial cover
                                    on the acreage under this
                                    subparagraph and receives cost-
                                    share assistance from the
                                    Corporation with respect to the
                                    cover, the producer, under such
                                    terms and conditions as may be
                                    prescribed by the Secretary,
                                    taking into consideration
                                    guidelines established by the
                                    State technical committees
                                    established in subtitle G of
                                    title XII of the Food Security
                                    Act of 1985, shall agree to
                                    maintain the perennial cover
                                    for a minimum of 3 years.
                              [(iii) Conserving crops.--The
                            Secretary may permit, subject to such
                            terms and conditions as the Secretary
                            may prescribe, all or any part of the
                            acreage to be devoted to sweet sorghum,
                            guar, sesame, castor beans, crambe,
                            plantago ovato, triticale, rye, mung
                            beans, milkweed, or other commodity, if
                            the Secretary determines that the
                            production is needed to provide an
                            adequate supply of the commodities, is
                            not likely to increase the cost of the
                            price support program, and will not
                            affect farm income adversely.
                      [(C) Haying and grazing.--
                              [(i) In general.--Except as provided
                            in clause (ii), haying and grazing of
                            reduced acreage, acreage devoted to a
                            conservation use under subsection
                            (c)(1)(E), and acreage diverted from
                            production under a land diversion
                            program established under this section
                            shall be permitted, except during any
                            consecutive 5-month period that is
                            established by the State committee
                            established under section 8(b) of the
                            Soil Conservation and Domestic
                            Allotment Act (16 U.S.C. 590h(b)) for a
                            State. The 5-month period shall be
                            established during the period beginning
                            April 1, and ending October 31, of a
                            year.
                              [(ii) Natural disasters.--In the case
                            of a natural disaster, the Secretary
                            may permit unlimited haying and grazing
                            on the acreage. The Secretary may not
                            exclude irrigated or irrigable acreage
                            not planted in alfalfa when exercising
                            the authority under this clause.
                      [(D) Water storage uses.--
                              [(i) In general.--The regulations
                            issued by the Secretary under paragraph
                            (2) with respect to acreage required to
                            be devoted to conservation uses shall
                            provide that land that has been
                            converted to water storage uses shall
                            be considered to be devoted to
                            conservation uses if the land was
                            devoted to wheat, feed grains, cotton,
                            rice, or oilseeds in at least 3 of the
                            immediately preceding 5 years. The land
                            shall be considered to be devoted to
                            conservation uses for the period that
                            the land remains in water storage uses,
                            but not to exceed 5 years subsequent to
                            its conversion to water storage uses.
                              [(ii) Limitations.--Land converted to
                            water storage uses for the purposes of
                            this subparagraph may not be devoted to
                            any commercial use, including
                            commercial fish production. The water
                            stored on the land may not be ground
                            water. The farm on which the land is
                            located must have been irrigated with
                            ground water during at least 1 of the
                            preceding 5 crop years.
                      [(E) Summer fallow.--In determining the
                    quantity of land to be devoted to conservation
                    uses under an acreage limitation program with
                    respect to land that has been farmed under
                    summer fallow practices, as defined by the
                    Secretary, the Secretary shall consider the
                    effects of soil erosion and such other factors
                    as the Secretary considers appropriate.
              [(5) Land diversion payments.--
                      [(A) In general.--The Secretary may make land
                    diversion payments to producers of wheat,
                    whether or not an acreage limitation program
                    for wheat is in effect, if the Secretary
                    determines that the land diversion payments are
                    necessary to assist in adjusting the total
                    national acreage of wheat to desirable goals.
                    The land diversion payments shall be made to
                    producers who, to the extent prescribed by the
                    Secretary, devote to approved conservation uses
                    an acreage of cropland on the farm in
                    accordance with land diversion contracts
                    entered into by the Secretary with the
                    producers.
                      [(B) Amounts.--The amounts payable to
                    producers under land diversion contracts may be
                    determined through the submission of bids for
                    the contracts by producers in such manner as
                    the Secretary may prescribe or through such
                    other means as the Secretary determines
                    appropriate. In determining the acceptability
                    of contract offers, the Secretary shall take
                    into consideration the extent of the diversion
                    to be undertaken by the producers and the
                    productivity of the acreage diverted.
                      [(C) Limitation on diverted acreage.--The
                    Secretary shall limit the total acreage to be
                    diverted under agreements in any county or
                    local community so as not to affect adversely
                    the economy of the county or local community.
              [(6) Conservation practices.--
                      [(A) Wildlife food plots or habitat.--The
                    reduced acreage and additional diverted acreage
                    may be devoted to wildlife food plots or
                    wildlife habitat in conformity with standards
                    established by the Secretary in consultation
                    with wildlife agencies. The Secretary may pay
                    an appropriate share of the cost of practices
                    designed to carry out the purposes of this
                    subparagraph.
                      [(B) Soil and water conservation practices.--
                    The Secretary may also pay an appropriate share
                    of the cost of approved soil and water
                    conservation practices (including practices
                    that may be effective for a number of years)
                    established by the producer on acreage required
                    to be devoted to conservation uses or on
                    additional diverted acreage.
                      [(C) Public accessibility.--The Secretary may
                    provide for an additional payment on the
                    acreage in an amount determined by the
                    Secretary to be appropriate in relation to the
                    benefit to the general public if the producer
                    agrees to permit, without other compensation,
                    access to all or such portion of the farm, as
                    the Secretary may prescribe, by the general
                    public, for hunting, trapping, fishing, and
                    hiking, subject to applicable State and Federal
                    regulations.
              [(7) Participation agreements.--
                      [(A) In general.--Producers on a farm
                    desiring to participate in the program
                    conducted under this subsection shall execute
                    an agreement with the Secretary providing for
                    the participation not later than such date as
                    the Secretary may prescribe.
                      [(B) Modification or termination.--The
                    Secretary may, by mutual agreement with
                    producers on a farm, modify or terminate any
                    such agreement if the Secretary determines the
                    action necessary because of an emergency
                    created by drought or other disaster or to
                    prevent or alleviate a shortage in the supply
                    of agricultural commodities. The Secretary may
                    modify the agreement under this subparagraph
                    for the purpose of alleviating a shortage in
                    the supply of agricultural commodities only if
                    there has been a significant change in the
                    estimated stocks of the commodity since the
                    Secretary announced the final terms and
                    conditions of the program for the crop of
                    wheat.
              [(8) Special oats plantings.--In any crop year that
            the Secretary determines that projected domestic
            production of oats will not fulfill the projected
            domestic demand for oats, notwithstanding the foregoing
            provisions of this subsection, the Secretary--
                      [(A) may provide that any reduced acreage may
                    be planted to oats for harvest;
                      [(B) may make program benefits (including
                    loans, purchases, and payments) available under
                    the annual program for oats under section 105B
                    available to producers with respect to acreage
                    planted to oats under this paragraph; and
                      [(C) shall not make program benefits other
                    than the benefits specified in subparagraph (B)
                    available to producers with respect to acreage
                    planted to oats under this paragraph.
      [(f) Inventory Reduction Payments.--
              [(1) In general.--The Secretary may, for each of the
            1991 through 1995 crops of wheat, make payments
            available to producers who meet the requirements of
            this subsection.
              [(2) Form.--The payments may be made in the form of
            marketing certificates.
              [(3) Payments.--Payments under this subsection shall
            be determined in the same manner as provided in
            subsection (b).
              [(4) Eligibility.--A producer shall be eligible to
            receive a payment under this subsection for a crop if
            the producer--
                      [(A) agrees to forgo obtaining a loan or
                    purchase agreement under subsection (a);
                      [(B) agrees to forgo receiving payments under
                    subsection (c);
                      [(C) does not plant wheat for harvest in
                    excess of the crop acreage base reduced by one-
                    half of any acreage required to be diverted
                    from production under subsection (e); and
                      [(D) otherwise complies with this section.
      [(g) Pilot Voluntary Production Limitation Program.--
              [(1) In general.--Effective for the 1992 or 1993
            crops (and, if the Secretary so determines, the 1994
            and 1995 crops), if a wheat acreage limitation program
            or a land diversion program is announced under
            subsection (e) for such crops, the Secretary shall
            carry out a pilot program in at least 15 counties in at
            least 2 States where producers express an interest in
            participating in the pilot program under which the
            producers on a farm shall be considered to have met the
            requirements of such acreage limitation or land
            diversion program if the producers meet the
            requirements of the voluntary production limitation
            program established under this subsection.
              [(2) Limitation on marketing.--In order to comply
            with the voluntary production limitation program, the
            producers on a farm must agree not to market, barter,
            donate, or use on the farm (including use as feed for
            livestock) in a marketing year a quantity of wheat in
            excess of the wheat production limitation quantity for
            the farm for the marketing year.
              [(3) Production limitation quantity.--For purposes of
            this subsection, the production limitation quantity for
            a farm for a marketing year for a crop shall equal the
            product obtained by multiplying--
                      [(A) the acreage permitted to be planted to
                    wheat under the acreage reduction program or
                    land diversion program in effect for the crop
                    for the farm; by
                      [(B) the higher of--
                              [(i) the farm program payment yield
                            for the farm; or
                              [(ii) the average of the yield per
                            harvested acre for wheat for the farm
                            for each of the 5 crop years
                            immediately preceding the crop year
                            during which the producers first
                            participate in the program established
                            under this subsection, excluding the
                            crop years with the highest and lowest
                            yield per harvested acre and any crop
                            year in which the commodity was not
                            planted on the farm.
              [(4) Terms and conditions.--Producers on a farm who
            elect to participate in the program established under
            this subsection for a crop of wheat shall--
                      [(A) enter into an agreement with the
                    Secretary providing that the producers shall
                    comply with the program for the crop;
                      [(B) not plant program commodities for
                    harvest in a quantity in excess of the sum of
                    the crop acreage bases for the farm; and
                      [(C) be considered to have complied with the
                    terms and conditions of the wheat acreage
                    reduction program or land diversion program for
                    the crop, even though the acreage planted to
                    wheat on the farm exceeds the permitted acreage
                    provided under the acreage reduction or land
                    diversion program.
              [(5) Excess production.--
                      [(A) In general.--Any quantity of wheat
                    produced in a crop year on a farm in excess of
                    the production limitation quantity for the farm
                    may be stored by the producers for a period of
                    not to exceed 5 marketing years and may be used
                    only in accordance with this paragraph.
                      [(B) Marketing in subsequent year.--
                              [(i) Participants in program.--
                            Producers on a farm who are
                            participating in the program
                            established under this subsection may
                            market, barter, or use a quantity of
                            the excess wheat referred to in
                            subparagraph (A) equal to the
                            difference between the production
                            limitation quantity for the farm for
                            the crop year subsequent to the crop
                            year in which the excess wheat is
                            produced less the quantity of wheat
                            produced on the farm during the crop
                            year.
                              [(ii) Participants in acreage
                            reduction program.--Producers on a farm
                            who are participating in an acreage
                            reduction or a land diversion program
                            for a crop of wheat may market, barter,
                            or use a quantity of the excess wheat
                            referred to in subparagraph (A) in an
                            amount that reflects the quantity of
                            wheat that would be expected to be
                            produced on acreage that the producers
                            agree to devote to approved
                            conservation uses (in excess of any
                            acreage reduction or land diversion
                            requirements) during a crop year, as
                            determined by the Secretary.
              [(6) Duties of secretary.--In carrying out the pilot
            program established under this subsection, the
            Secretary--
                      [(A) shall issue such regulations as are
                    necessary to carry out the program;
                      [(B) may require increased acreage reduction
                    or land diversion requirements with respect to
                    producers who have had excess wheat production
                    in order to allow the producers to market,
                    barter, or use the production in subsequent
                    years;
                      [(C) shall take appropriate measures designed
                    to prevent the circumvention of the program
                    established under this subsection, including
                    the imposition of penalties;
                      [(D) may require producers who participate in
                    the program for a crop, but who fail to comply
                    with the terms and conditions of the program,
                    to refund all or a part of any deficiency
                    payments received with respect to the crop;
                      [(E) may require the forfeiture to the
                    Commodity Credit Corporation of any wheat that
                    is produced in excess of the production
                    limitation quantity and that is not marketed,
                    bartered, or used within 5 marketing years; and
                      [(F) shall ensure equitable treatment for
                    producers who participate in the pilot program
                    if the Secretary allows increases (based on
                    actual production levels) in the determination
                    of farm program payment yields for wheat for
                    the farm.
              [(7) Report.--
                      [(A) In general.--The Comptroller General of
                    the United States shall prepare a report that
                    evaluates the pilot program carried out under
                    this subsection.
                      [(B) Submission.--The Comptroller General
                    shall submit a copy of the report required by
                    subparagraph (A) to the Committee on
                    Agriculture of the House of Representatives,
                    the Committee on Agriculture, Nutrition, and
                    Forestry of the Senate, and the Secretary.
      [(h) Equitable Relief.--
              [(1) Loans, purchases, and payments.--If the failure
            of a producer to comply fully with the terms and
            conditions of the program conducted under this section
            precludes the making of loans, purchases, and payments,
            the Secretary may, nevertheless, make such loans,
            purchases, and payments in such amounts as the
            Secretary determines are equitable in relation to the
            seriousness of the failure. The Secretary may consider
            whether the producer made a good faith effort to comply
            fully with the terms and conditions of such program in
            determining whether equitable relief is warranted under
            this paragraph.
              [(2) Deadlines and program requirements.--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 program requirements in
            cases in which lateness or failure to meet such other
            requirements does not affect adversely the operation of
            the program.
      [(i) Regulations.--The Secretary may issue such regulations
    as the Secretary determines necessary to carry out this
    section.
      [(j) Commodity Credit Corporation.--The Secretary shall carry
    out the program authorized by this section through the
    Commodity Credit Corporation.
      [(k) 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 under this section.
      [(l) Sharing of Payments.--The Secretary shall provide for
    the sharing of payments made under this section for any farm
    among the producers on the farm on a fair and equitable basis.
      [(m) Tenants and Sharecroppers.--The Secretary shall provide
    adequate safeguards to protect the interests of tenants and
    sharecroppers.
      [(n) Cross-Compliance.--
              [(1) In general.--Compliance on a farm with the terms
            and conditions of any other commodity program, or
            compliance with crop acreage base requirements for any
            other commodity, may not be required as a condition of
            eligibility for loans, purchases, or payments under
            this section.
              [(2) Compliance on other farms.--The Secretary may
            not require producers on a farm, as a condition of
            eligibility for loans, purchases, or payments under
            this section for the farm, to comply with the terms and
            conditions of the wheat program with respect to any
            other farm operated by the producers.
      [(o) Public Comment on Wheat Program.--
              [(1) In general.--In order to ensure that producers
            and consumers of wheat are provided with reasonable
            opportunity to comment on the annual program
            determinations concerning the price support and acreage
            reduction program for each of the 1992 and subsequent
            crops of wheat, the Secretary shall request public
            comment regarding the wheat program in accordance with
            this subsection.
              [(2) Options.--Not less than 60 days before the
            program is announced for a crop of wheat under this
            section, the Secretary shall propose for public comment
            various program options for the crop of wheat.
              [(3) Analyses.--Each option proposed by the Secretary
            shall be accompanied by an analysis that includes the
            estimated planted acreage, production, domestic and
            export use, ending stocks, season average producer
            price, program participation rate, and cost to the
            Federal Government that would likely result from each
            option.
              [(4) Estimates.--In announcing the program for a crop
            of wheat under this section, the Secretary shall
            include an estimate of the planted acreage, production,
            domestic and export use, ending stocks, season average
            producer price, program participation rate, and cost to
            the Federal Government that is expected to result from
            the program as announced.
      [(p) Special Provisions for Wheat Planted in 1990.--Effective
    with respect to producers of the 1991 crop of wheat that was
    planted in 1990, a producer may, when participating in the
    production adjustment program for the 1991 crop of wheat
    specified in this section elect to participate in the program
    with the following modifications:
              [(1) Deficiency payments.--The producer's deficiency
            payment shall be the amount by which the established
            price for the crop of wheat exceeds the higher of--
                      [(A) the lesser of--
                              [(i) the national weighted average
                            market price received by producers
                            during the marketing year for the crop,
                            as determined by the Secretary; or
                              [(ii) the national weighted average
                            market price received by producers
                            during the first 5 months of the
                            marketing year for the crop, as
                            determined by the Secretary, plus 10
                            cents per bushel; or
                      [(B) the loan level determined for the crop,
                    prior to any adjustment made under subsection
                    (a)(3) for the marketing year for the crop of
                    wheat.
              [(2) Payment acres.--The producer's payment acres
            shall be the lesser of--
                      [(A) the number of acres planted to the crop
                    for harvest within the permitted acreage; or
                      [(B) 100 percent of the crop acreage base for
                    the crop for the farm less the quantity of
                    reduced acreage (as determined under subsection
                    (e)(2)(D)).
      [(q) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through 1995 crops
    of wheat.

    [SEC. 108B. PRICE SUPPORT PROGRAM FOR 1991 THROUGH 1997 CROPS OF
                        PEANUTS.

      [(a) Quota Peanuts.--
              [(1) In general.--The Secretary shall make price
            support available to producers through loans,
            purchases, and other operations on quota peanuts for
            each of the 1991 through 1997 crops.
              [(2) Support rates.--The national average quota
            support rate for each of the 1991 through 1997 crops of
            quota peanuts shall be the national average quota
            support rate for the immediately preceding crop,
            adjusted to reflect any increase, during the calendar
            year immediately preceding the marketing year for the
            crop for which a level of support is being determined,
            in the national average cost of peanut production,
            excluding any change in the cost of land and the cost
            of any assessments required under subsection (g),
            except that in no event shall the national average
            quota support rate for any such crop exceed by more
            than 5 percent the national average quota support rate
            for the preceding crop.
              [(3) Inspection, handling, or storage.--The levels of
            support so announced shall not be reduced by any
            deductions for inspection, handling, or storage.
              [(4) Location and other factors.--The Secretary may
            make adjustments for location of peanuts and such other
            factors as are authorized by section 403.
              [(5) Announcement.--The Secretary shall announce the
            level of support for quota peanuts of each crop not
            later than February 15 preceding the marketing year for
            the crop for which the level of support is being
            determined.
      [(b) Additional Peanuts.--
              [(1) In general.--The Secretary shall make price
            support available to producers through loans,
            purchases, or other operations on additional peanuts
            for each of the 1991 through 1997 crops at such levels
            as the Secretary finds appropriate, taking into
            consideration the demand for peanut oil and peanut
            meal, expected prices of other vegetable oils and
            protein meals, and the demand for peanuts in foreign
            markets, except that the Secretary shall set the
            support rate on additional peanuts at a level estimated
            by the Secretary to ensure that there are no losses to
            the Commodity Credit Corporation on the sale or
            disposal of the peanuts.
              [(2) Announcement.--The Secretary shall announce the
            level of support for additional peanuts of each crop
            not later than February 15 preceding the marketing year
            for the crop for which the level of support is being
            determined.
      [(c) Area Marketing Associations.--
              [(1) Warehouse storage loans.--
                      [(A) In general.--In carrying out subsections
                    (a) and (b), the Secretary shall make warehouse
                    storage loans available in each of the three
                    producing areas (described in section 1446.95
                    of title 7 of the Code of Federal Regulations
                    (January 1, 1989)) to a designated area
                    marketing association of peanut producers that
                    is selected and approved by the Secretary and
                    that is operated primarily for the purpose of
                    conducting the loan activities. The Secretary
                    may not make warehouse storage loans available
                    to any cooperative that is engaged in
                    operations or activities concerning peanuts
                    other than those operations and activities
                    specified in this section and sections 358d and
                    358e of the Agricultural Adjustment Act of
                    1938.
                      [(B) Administrative and supervisory
                    activities.--The area marketing associations
                    shall be used in administrative and supervisory
                    activities relating to price support and
                    marketing activities under this section and
                    sections 358d and 358e of the Agricultural
                    Adjustment Act of 1938.
                      [(C) Association costs.--Loans made to the
                    association under this paragraph shall include,
                    in addition to the price support value of the
                    peanuts, such costs as the area marketing
                    association reasonably may incur in carrying
                    out its responsibilities, operations, and
                    activities under this section and sections 358d
                    and 358e 108B-6 of the Agricultural
                    Adjustment Act of 1938.
              [(2) Pools for quota and additional peanuts.--
                      [(A) In general.--The Secretary shall require
                    that each area marketing association establish
                    pools and maintain complete and accurate
                    records by area and segregation for quota
                    peanuts handled under loan and for additional
                    peanuts placed under loan, except that separate
                    pools shall be established for Valencia peanuts
                    produced in New Mexico. Bright hull and dark
                    hull Valencia peanuts shall be considered as
                    separate types for the purpose of establishing
                    the pools.
                      [(B) Net gains.--Net gains on peanuts in each
                    pool, unless otherwise approved by the
                    Secretary, shall be distributed only to
                    producers who placed peanuts in the pool and
                    shall be distributed in proportion to the value
                    of the peanuts placed in the pool by each
                    producer. Net gains for peanuts in each pool
                    shall consist of the following:
                              [(i) Quota peanuts.--For quota
                            peanuts, the net gains over and above
                            the loan indebtedness and other costs
                            or losses incurred on peanuts placed in
                            the pool plus an amount from all
                            additional pool gains equal to any loss
                            on disposition of all peanuts in the
                            pool for quota peanuts.
                              [(ii) Additional peanuts.--For
                            additional peanuts, the net gains over
                            and above the loan indebtedness and
                            other costs or losses incurred on
                            peanuts placed in the pool for
                            additional peanuts less any amount
                            allocated to offset any loss on the
                            pool for quota peanuts as provided in
                            clause (i).
      [(d) Losses.--Notwithstanding any other provision of this
    section:
              [(1) Quota peanuts placed under loan.--Any
            distribution of net gains on additional peanuts (other
            than net gains on additional peanuts in separate type
            pools established under subsection (c)(2)(A) for
            Valencia peanuts produced in New Mexico) shall be first
            reduced to the extent of any loss by the Commodity
            Credit Corporation on quota peanuts placed under loan.
              [(2) Quota loan pools.--
                      [(A) Transfers from additional loan pools.--
                    The proceeds due any producer from any pool
                    shall be reduced by the amount of any loss that
                    is incurred with respect to peanuts transferred
                    from an additional loan pool to a quota loan
                    pool by such producer under section 358-1(b)(8)
                    of the Agricultural Adjustment Act of 1938.
                      [(B) Other losses.--Losses in area quota
                    pools, other than losses incurred as a result
                    of transfers from additional loan pools to
                    quota loan pools under section 358-1(b)(8) of
                    the Agricultural Adjustment Act of 1938, shall
                    be offset by any gains or profits from pools in
                    other production areas (other than separate
                    type pools established under subsection
                    (c)(2)(A) for Valencia peanuts produced in New
                    Mexico) in such manner as the Secretary shall
                    by regulation prescribe.
      [(e) Disapproval of Quotas.--Notwithstanding any other
    provision of law, no price support may be made available by the
    Secretary for any crop of peanuts with respect to which
    poundage quotas have been disapproved by producers, as provided
    for in section 358-1(d) of the Agricultural Adjustment Act of
    1938.
      [(f) Quality Improvement.--
              [(1) Price support peanuts.--With respect to peanuts
            under price support loan, the Secretary shall--
                      [(A) promote the crushing of peanuts at a
                    greater risk of deterioration before peanuts of
                    a lesser risk of deterioration;
                      [(B) ensure that all Commodity Credit
                    Corporation loan stocks of peanuts sold for
                    domestic edible use must be shown to have been
                    officially inspected by licensed Department of
                    Agriculture inspectors both as farmer stock and
                    shelled or cleaned in-shell peanuts;
                      [(C) continue to endeavor to operate the
                    peanut price support program so as to improve
                    the quality of domestic peanuts and ensure the
                    coordination of activities under the Peanut
                    Administrative Committee established under
                    Marketing Agreement No. 146, regulating the
                    quality of domestically produced peanuts (under
                    the Agricultural Marketing Agreement Act of
                    1937 (7 U.S.C. 601 et seq.)); and
                      [(D) ensure that any changes made in the
                    price support program as a result of this
                    subsection requiring additional production or
                    handling at the farm level shall be reflected
                    as an upward adjustment in the Department of
                    Agriculture loan schedule.
              [(2) Exports and other peanuts.--The Secretary shall
            require that all peanuts in the domestic market fully
            comply with all quality standards under Marketing
            Agreement No. 146. The Secretary shall ensure that
            peanuts produced for the export market meet quality
            standards established for the domestic market under
            Marketing Agreement No. 146.
      [(g) Marketing Assessment.--
              [(1) In general.--The Secretary shall provide, by
            regulation, for a nonrefundable marketing assessment
            applicable to each of the 1991 through 1997 crops of
            peanuts. The assessment shall be made in accordance
            with this subsection and shall be on a per pound basis
            in an amount equal to 1 percent for each of the 1991
            through 1993 crops, 1.1 percent for each of the 1994
            and 1995 crops, 1.15 percent for the 1996 crop, and 1.2
            percent for the 1997 crop, of the national average
            quota or additional peanut support rate per pound, as
            applicable, for the applicable crop. No peanuts shall
            be assessed more than 1 percent for each of the 1991
            through 1993 crops, 1.1 percent for each of the 1994
            and 1995 crops, 1.15 percent for the 1996 crop, and 1.2
            percent for the 1997 crop, of the applicable support
            rate under this subsection.
              [(2) First purchasers.--
                      [(A) In general.--Except as provided under
                    paragraphs (3) and (4), the first purchaser of
                    peanuts shall--
                              [(i) collect from the producer a
                            marketing assessment equal to the
                            quantity of peanuts acquired multiplied
                            by--
                                      [(I) in the case of each of
                                    the 1991 through 1993 crops, .5
                                    percent of the applicable
                                    national average support rate;
                                      [(II) in the case of each of
                                    the 1994 and 1995 crops, .55
                                    percent of the applicable
                                    national average support rate;
                                      [(III) in the case of the
                                    1996 crop, .6 percent of the
                                    applicable national average
                                    support rate; and
                                      [(IV) in the case of the 1997
                                    crop, .65 percent of the
                                    applicable national average
                                    support rate;
                              [(ii) pay, in addition to the amount
                            collected under clause (i), a marketing
                            assessment in an amount equal to the
                            quantity of peanuts acquired multiplied
                            by--
                                      [(I) in the case of each of
                                    the 1991 through 1993 crops, .5
                                    percent of the applicable
                                    national average support rate;
                                    and
                                      [(II) in the case of each of
                                    the 1994 through 1997 crops,
                                    .55 percent of the applicable
                                    national average support rate;
                                    and
                              [(iii) remit the amounts required
                            under clauses (i) and (ii) to the
                            Commodity Credit Corporation in a
                            manner specified by the Secretary.
                      [(B) Definition.--For purposes of this
                    subsection, the term ``first purchaser'' means
                    a person acquiring peanuts from a producer
                    except that in the case of peanuts forfeited by
                    a producer to the Commodity Credit Corporation,
                    such term means the person acquiring the
                    peanuts from the Commodity Credit Corporation.
              [(3) Other private marketings.--In the case of a
            private marketing by a producer directly to a consumer
            through a retail or wholesale outlet or in the case of
            a marketing by the producer outside of the continental
            United States, the producer shall be responsible for
            the full amount of the assessment and shall remit the
            assessment by such time as is specified by the
            Secretary.
              [(4) Loan peanuts.--In the case of peanuts that are
            pledged as collateral for a price support loan made
            under this section, \1/2\ of the assessment shall be
            deducted from the proceeds of the loan. The remainder
            of the assessment shall be paid by the first purchaser
            of the peanuts. For purposes of computing net gains on
            peanuts under this section, the reduction in loan
            proceeds shall be treated as having been paid to the
            producer.
              [(5) Penalties.--If any person fails to collect or
            remit the reduction required by this subsection or
            fails to comply with such requirements for
            recordkeeping or otherwise as are required by the
            Secretary to carry out this subsection, the person
            shall be liable to the Secretary for a civil penalty up
            to an amount determined by multiplying--
                      [(A) the quantity of peanuts involved in the
                    violation; by
                      [(B) the national average quota peanut price
                    support level for the applicable crop year.
              [(6) Enforcement.--The Secretary may enforce this
            subsection in the courts of the United States.
      [(h) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through 1997 crops
    of peanuts.

    [SEC. 110. FARMER OWNED RESERVE PROGRAM.

      [(a) In General.--The Secretary shall formulate and
    administer a farmer owned reserve program under which producers
    of wheat and feed grains will be able to store wheat and feed
    grains when the commodities are in abundant supply, extend the
    time period for the orderly marketing of the commodities, and
    provide for adequate carryover stocks to ensure a reliable
    supply of the commodities.
      [(b) Terms of Program.--
              [(1) Price support loans.--In carrying out this
            program, the Secretary shall provide extended price
            support loans for wheat and feed grains. An extended
            loan shall only be made to a producer after the
            expiration of a 9-month price support loan (hereafter
            in this section referred to as the ``original loan'')
            made in accordance with this title.
              [(2) Level of loans.--Loans made under this section
            shall not be less than the then current level of
            support under the wheat and feed grain programs
            established under this title.
              [(3) Other terms and conditions.--The Secretary shall
            provide for--
                      [(A) repayment of the extended price support
                    loan 27 months from the date on which the
                    original loan expired unless, at the discretion
                    of the Secretary, the loan has been extended
                    for one 6-month period;
                      [(B) a rate of interest as provided under
                    subsection (c); and
                      [(C) payments to producers for storage as
                    provided in subsection (d).
              [(4) Regional differences.--The Secretary shall
            ensure that producers are afforded a fair and equitable
            opportunity to participate in the program established
            under this section, taking into account regional
            differences in the time of harvest.
      [(c) Interest Charges.--
              [(1) Levying of interest.--The Secretary may charge
            interest on loans under this section whenever the price
            of wheat or feed grains is equal to or exceeds 105
            percent of the then current established price for the
            commodity.
              [(2) 90-day period.--If interest is levied on the
            loans under paragraph (1), the interest may be charged
            for a period of 90 days after the last day on which the
            price of wheat or feed grains was equal to or in excess
            of 105 percent of the established price for the
            commodities.
              [(3) Rate of interest.--The rate of interest charged
            participants in this program shall not be less than the
            rate of interest charged by the Commodity Credit
            Corporation by the United States Treasury, except that
            the Secretary may waive or adjust the interest as the
            Secretary considers appropriate to effectuate the
            purposes of this section.
      [(d) Storage Payments.--
              [(1) In general.--The Secretary shall provide storage
            payments to producers for storage of wheat or feed
            grains under the program established in this section in
            such amounts and under such conditions as the Secretary
            determines appropriate to encourage producers to
            participate in the program.
              [(2) Timing.--The Secretary shall make storage
            payments available to participants in this program at
            the end of each quarter.
              [(3) Duration.--The Secretary shall cease making
            storage payments whenever the price of wheat or feed
            grains is equal to or exceeds 95 percent of the then
            current established price for the commodities, and for
            any 90-day period immediately following the last day on
            which the price of wheat or feed grains was equal to or
            in excess of 95 percent of the then current established
            price for the commodities.
      [(e) Emergencies.--Notwithstanding any other provision of
    law, the Secretary may require producers to repay loans made
    under this section, plus accrued interest and such other
    charges as may be required by regulation prior to the maturity
    date thereof, if the Secretary determines that emergency
    conditions exist that require that the commodity be made
    available in the market to meet urgent domestic or
    international needs and the Secretary reports the determination
    and the reasons for the determination to the President, the
    Committee on Agriculture of the House of Representatives, and
    the Committee on Agriculture, Nutrition, and Forestry of the
    Senate at least 14 days before taking the action.
      [(f) Quantity of Commodities in Program.--The Secretary may
    establish maximum quantities of wheat and feed grains that may
    receive loans and storage payments under this program as
    follows:
              [(1) The maximum quantities of wheat may not be
            established at less than 300 million bushels, nor more
            than 450 million bushels.
              [(2) The maximum quantities of feed grains may not be
            established at less than 600 million bushels, nor more
            than 900 million bushels.
      [(g) Announcement of Program.--
              [(1) Time of announcement.--The Secretary shall
            announce the terms and conditions of the producer
            storage program for a crop of wheat and feed grains
            by--
                      [(A) in the case of wheat, December 15 of the
                    year in which the crop of wheat was harvested;
                    and
                      [(B) in the case of feed grains, March 15 of
                    the year following the year in which the crop
                    of corn was harvested.
              [(2) Discretionary entry.--The Secretary may make
            extended loans available to producers of wheat or feed
            grains if--
                      [(A) the Secretary determines that the
                    average market price for wheat or corn,
                    respectively, for the 90-day period prior to
                    the dates specified in paragraph (1) is less
                    than 120 percent of the current loan rate for
                    wheat or corn, respectively; or
                      [(B) as of the appropriate date specified in
                    paragraph (1), the Secretary estimates that the
                    stocks-to-use ratio on the last day of the
                    current marketing year will be--
                              [(i) in the case of wheat, more than
                            37.5 percent; and
                              [(ii) in the case of corn, more than
                            22.5 percent.
              [(3) Mandatory entry.--The Secretary shall make
            extended loans available to producers of wheat or feed
            grains if the conditions specified in subparagraphs (A)
            and (B) of paragraph (2) are met for wheat or feed
            grains, respectively.
              [(4) Content of announcement.--In the announcement,
            the Secretary shall specify the maximum quantity of
            wheat or feed grains to be stored under this program
            that the Secretary determines appropriate to promote
            the orderly marketing of the commodities.
      [(h) Discretionary Exit.--A producer may repay a loan
    extended under this section at any time.
      [(i) Reconcentration of Grain.--The Secretary may, with the
    concurrence of the owner of grain stored under this program,
    reconcentrate all such grain stored in commercial warehouses at
    such points as the Secretary considers to be in the public
    interest, taking into account such factors as transportation
    and normal marketing patterns. The Secretary shall permit
    rotation of stocks and facilitate maintenance of quality under
    regulations that assure that the holding producer or
    warehouseman shall, at all times, have available for delivery
    at the designated place of storage both the quantity and
    quality of grain covered by the producer's or warehouseman's
    commitment.
      [(j) Management of Grain.--Whenever grain is stored under
    this section, the Secretary may buy and sell at an equivalent
    price, allowing for the customary location and grade
    differentials, substantially equivalent quantities of grain in
    different locations or warehouses to the extent needed to
    properly handle, rotate, distribute, and locate the commodities
    that the Commodity Credit Corporation owns or controls. The
    purchases to offset sales shall be made within 2 market days
    following the sales. The Secretary shall make a daily list
    available showing the price, location, and quantity of the
    transactions.
      [(k) Use of Commodity Credit Corporation.--The Secretary
    shall use the Commodity Credit Corporation, to the extent
    feasible, to fulfill the purposes of this section. To the
    maximum extent practicable consistent with the fulfillment of
    the purposes of this section and the effective and efficient
    administration of this section, the Secretary shall utilize the
    usual and customary channels, facilities, and arrangements of
    trade and commerce.
      [(l) Use of Commodity Certificates.--Notwithstanding any
    other provision of law, if a producer has substituted purchased
    or other commodities for the commodities originally pledged as
    collateral for a loan made under this section, the Secretary
    may allow a producer to repay the loan using a generic
    commodity certificate that may be exchanged for commodities
    owned by the Commodity Credit Corporation, if the substitute
    commodities have been pledged as loan collateral and redeemed
    only within the same county.
      [(m) Additional Authority.--The authority provided by this
    section shall be in addition to other authorities available to
    the Secretary for carrying out producer loan and storage
    operations.
      [(n) Regulations.--The Secretary of Agriculture shall issue
    such regulations as are necessary to carry out this section not
    later than 60 days after November 28, 1990.
      [(o) Review.--In announcing the terms and conditions of the
    producer storage program under this section, the Secretary
    shall review standards concerning the quality of grain that
    shall be allowed to be stored under the program, and such
    standards should encourage only quality grain, as determined by
    the Secretary, to be pledged as collateral for such loans. The
    Secretary shall review inspection, maintenance, and stock
    rotation requirements and take the necessary steps to maintain
    the quality of such grain.
      [(p) Crops.--Notwithstanding any other provision of law, this
    section shall become effective December 1, 1990.

                     [INTERNATIONAL EMERGENCY FOOD RESERVE

      [Sec. 111. The President is encouraged to enter into
    negotiations with other nations to develop an international
    system of food reserves to provide for humanitarian food relief
    needs and to establish and maintain a food reserve, as a
    contribution of the United States toward the development of
    such a system, to be made available in the event of food
    emergencies in foreign countries. The reserves shall be known
    as the International Emergency Food Reserve.

                 [AGRICULTURAL COMMODITIES UTILIZATION PROGRAM

      [Sec. 112. Notwithstanding any other provision of this Act--
      [(a) The Secretary may permit, subject to such terms and
    conditions as the Secretary may prescribe, all or any part of
    the acreage set aside or diverted from the production of a
    commodity for any crop year under this title to be devoted to
    the production of any commodity (other than the commodities for
    which acreage is being set aside or diverted) for conversion
    into industrial hydrocarbons and blending with gasoline or
    other fossil fuels for use as motor or industrial fuel, if the
    Secretary determines that such production is desirable in order
    to provide an adequate supply of commodities for such purpose,
    is not likely to increase the cost of the price support
    programs, and will not adversely affect farm income.
      [(b)(1) During any year in which there is no set-aside or
    diversion of acreage under this title, the Secretary may
    formulate and administer a program for the production, subject
    to such terms and conditions as the Secretary may prescribe, of
    commodities for conversion into industrial hydrocarbons and
    blending with gasoline or other fossil fuels for use as motor
    or industrial fuel, if the Secretary determines that such
    production is desirable in order to provide an adequate supply
    of commodities for such purpose, is not likely to increase the
    cost of the price support programs, and will not adversely
    affect farm income. Under the program, producers of wheat, feed
    grains, upland cotton, and rice shall be paid incentive
    payments to devote a portion of their acreage to the production
    of commodities for conversion into industrial hydrocarbons and
    blending with gasoline or other fossil fuels for use as motor
    or industrial fuel.
      [(2) The payments under this subsection shall be at such rate
    or rates as the Secretary determines to be fair and reasonable,
    taking into consideration the participation necessary to ensure
    an adequate supply of the agricultural commodities for
    conversion into industrial hydrocarbons and blending with
    gasoline or other fossil fuels for use as motor or industrial
    fuels.
      [(3) The Secretary may issue such regulations as the
    Secretary deems necessary to carry out the provisions of this
    subsection.
      [(4) There are authorized to be appropriated such sums as may
    be necessary to carry out the provisions of this subsection.
      [(5) The provisions of this subsection shall become effective
    October 1, 1978.

    [SEC. 113. SUPPLEMENTAL SET-ASIDE AND ACREAGE LIMITATION AUTHORITY.

      [Notwithstanding any other provision of law or prior
    announcement made by the Secretary to the contrary, the
    Secretary may announce and provide for an acreage limitation
    program under section 105B or 107B for one or more of the 1991
    through 1995 crops of wheat and feed grains if the Secretary
    determines that such action is in the public interest as a
    result of the imposition of restrictions on the export of any
    such commodity by the President or other member of the
    executive branch of the Federal Government. To carry out
    effectively an acreage limitation program authorized under this
    section, the Secretary may make such modifications and
    adjustments in such program as the Secretary determines
    necessary because of any delay in instituting such program.

    [SEC. 114. DEFICIENCY AND LAND DIVERSION PAYMENTS.

      [(a) Deficiency Payments.--
              [(1) In general.--If the Secretary establishes an
            acreage limitation program for any of the 1991 through
            1997 crops of wheat, feed grains, upland cotton, or
            rice under this Act and determines that deficiency
            payments will likely be made for the commodity for the
            crop, the Secretary shall make advance deficiency
            payments available to producers for each of the crops.
              [(2) Terms and Conditions.--Advance deficiency
            payments under paragraph (1) shall be made to the
            producer under the following terms and conditions:
                      [(A) Form.--Such payments may be made
                    available in the form of--
                              [(i) cash;
                              [(ii) commodities owned by the
                            Commodity Credit Corporation and
                            certificates redeemable in a commodity
                            owned by the Commodity Credit
                            Corporation, except that not more than
                            50 percent of the payments may be made
                            in commodities or the certificates in
                            the case of any producer; or
                              [(iii) any combination of clauses (i)
                            and (ii).
                      [(B) Commodities and certificates.--If
                    payments are made available to producers as
                    provided for under subparagraph (A)(ii), such
                    producers may elect to receive such payments
                    either in the form of--
                              [(i) such commodities; or
                              [(ii) such certificates.
                      [(C) Maturity.--Such a certificate shall be
                    redeemable for a period not to exceed 3 years
                    from the date the certificate is issued.
                      [(D) Storage.--The Commodity Credit
                    Corporation shall pay the cost of storing a
                    commodity that may be received under such a
                    certificate until such time as the certificate
                    is redeemed.
                      [(E) Timing.--The payments shall be made
                    available as soon as practicable after the
                    producer enters into a contract with the
                    Secretary to participate in such program.
                      [(F) Amounts.--The payments shall be made
                    available in such amounts as the Secretary
                    determines appropriate to encourage adequate
                    participation in the program, except that the
                    amount may not exceed an amount determined by
                    multiplying--
                              [(i) the estimated payment acreage
                            for the crop; by
                              [(ii) the farm program payment yield
                            for the crop; by
                              [(iii)(I) in the case of wheat and
                            feed grains, not less than 40 percent,
                            nor more than 50 percent, of the
                            projected payment rate; and
                              [(II) in the case of rice and upland
                            cotton, not less than 30 percent, nor
                            more than 50 percent, of the projected
                            payment rate,
                    as determined by the Secretary.
                      [(G) Repayment.--If the deficiency payment
                    payable to a producer for a crop, as finally
                    determined by the Secretary under this Act, is
                    less than the amount paid to the producer as an
                    advance deficiency payment for the crop under
                    this subsection, the producer shall repay an
                    amount equal to the difference between the
                    amount advanced and the amount finally
                    determined by the Secretary to be payable to
                    the producer as a deficiency payment for the
                    crop concerned.
                      [(H) Repayment requirement.--If the Secretary
                    determines under this Act that deficiency
                    payments will not be made available to
                    producers on a crop with respect to which
                    advance deficiency payments already have been
                    made under this subsection, the producers who
                    received the advance payments shall repay the
                    payments.
                      [(I) Deadline.--Any repayment required under
                    subparagraph (G) or (H) shall be due at the end
                    of the marketing year for the crop with respect
                    to which the payments were made.
                      [(J) Noncompliance.--If a producer fails to
                    comply with requirements established under the
                    acreage limitation program involved after
                    obtaining an advance deficiency payment under
                    this subsection, the producer shall repay
                    immediately the amount of the advance, plus
                    interest thereon in such amount as the
                    Secretary shall prescribe by regulation.
              [(3) Regulations.--The Secretary may issue such
            regulations as the Secretary determines necessary to
            carry out this section.
              [(4) Commodity credit corporation.--The Secretary
            shall carry out the program authorized by this section
            through the Commodity Credit Corporation.
              [(5) Additional authority.--The authority provided in
            this section shall be in addition to, and not in place
            of, any authority granted to the Secretary or the
            Commodity Credit Corporation under any other provision
            of law.
      [(b) Land Diversion Payments.--If the Secretary makes land
    diversion payments under this Act to assist in adjusting the
    total national acreage of any of the 1991 through 1995 crops of
    wheat, feed grains, upland cotton, or rice to desirable levels,
    the Secretary may make at least 50 percent of such payments
    available to a producer as soon as possible after the producer
    agrees to undertake the diversion of land in return for the
    payments.
      [(c) Timing of Deficiency Payments.--In the case of
    deficiency payments made available to producers for any of the
    1991 through 1997 crops of wheat and feed grains which payments
    are calculated as provided in section 107B(c)(1)(B)(ii),
    107B(p), or 105B(c)(1)(B)(ii), the Secretary shall make
    deficiency payments as follows:
              [(1) A portion of the deficiency payment shall be
            made in advance in accordance with subsection (a)(2).
              [(2) With respect to feed grains (excluding barley
            and oats), 75 percent of the final projected deficiency
            payment for the crop, reduced by the amount of the
            advance, shall be made available as soon as practicable
            after the end of the first 5 months of the applicable
            marketing year.
              [(3) With respect to wheat, barley, and oats, the
            final projected deficiency payment for the crop,
            reduced by the amount of the advance, shall be made
            available as soon as practicable after the end of the
            first 5 months of the applicable marketing year. Such
            projected payment shall be based on the national
            weighted average market price received by producers
            during the first 5 months of the marketing year for the
            crop, as determined by the Secretary, plus 10 cents per
            bushel with respect to wheat or 7 cents per bushel with
            respect to barley and oats.
              [(4) The remainder of the deficiency payments shall
            be made available at the end of the marketing year.
      [Sec. 115. (a) In making in-kind payments under any of the
    annual programs for wheat, feed grains, upland cotton, or rice
    (other than negotiable marketing certificates for upland cotton
    or rice), the Secretary may--
              [(1) acquire and use like commodities that have been
            pledged to the Commodity Credit Corporation as security
            for price support loans, including loans made to
            producers under section 110; and
              [(2) use other like commodities owned by the
            Commodity Credit Corporation.
      [(b) The Secretary may make in-kind payments--
              [(1) by delivery of the commodity to the producer at
            a warehouse or other similar facility, as determined by
            the Secretary;
              [(2) by the transfer of negotiable warehouse
            receipts;
              [(3) by the issuance of negotiable certificates which
            the Commodity Credit Corporation shall redeem for a
            commodity in accordance with regulations prescribed by
            the Secretary; or
              [(4) by such other methods as the Secretary
            determines appropriate to enable the producer to
            receive payments in an efficient, equitable, and
            expeditious manner so as to ensure that the producer
            receives the same total return as if the payments had
            been made in cash.
      [(c) The Secretary shall pay interest on the cash redemption
    of a commodity certificate issued by the Secretary to a
    producer who holds the certificate for at least 150 days. This
    subsection shall not apply with respect to commodity
    certificates issued in connection with the export enhancement
    program or the marketing promotion program established under
    the Agricultural Trade Act of 1978.

            [TITLE II--DESIGNATED NONBASIC AGRICULTURAL COMMODITIES

      [Sec. 201. (a) The Secretary is authorized and directed to
    make available (without regard to the provisions of title III)
    price support to producers for oilseeds (including soybeans,
    sunflower seed, canola, rapeseed, safflower, flaxseed, mustard
    seed, and such other oilseeds as the Secretary may determine),
    honey, milk, sugar beets, and sugarcane in accordance with this
    title.
      [(b) The price of honey shall be supported through loans,
    purchases, or other operations at a level not in excess of 90
    per centum nor less than 60 per centum of the parity price
    thereof; and the price of tung nuts for each crop of tung nuts
    through the 1976 crop shall be supported through loans,
    purchases, or other operations at a level not in excess of 90
    per centum nor less than 60 per centum of the parity price
    therefor: Provided, That in any crop year through the 1976 crop
    year in which the Secretary determines that the domestic
    production of tung oil will be less than the anticipated
    domestic demand for such oil, the price of tung nuts shall be
    supported at not less than 65 per centum of the parity price
    therefor.
      [(c) Except as provided in section 204, the price of milk
    shall be supported at such level not in excess of 90 per centum
    nor less than 75 per centum of the parity price therefor as the
    Secretary determines necessary in order to assure an adequate
    supply of pure and wholesome milk to meet current needs,
    reflect changes in the cost of production, and assure a level
    of farm income adequate to maintain productive capacity
    sufficient to meet anticipated future needs. Such price support
    shall be provided through purchases of milk and the products of
    milk.
      [Sec. 202. As a means of increasing the utilization of dairy
    products, (including for purposes of this section, milk) upon
    the certification by the Secretary of Veterans Affairs or by
    the Secretary of the Army, acting for the military departments
    under the Department of Defense's Single Service Purchase
    Assignment for Subsistence, or their duly authorized
    representatives that the usual quantities of dairy products
    have been purchased in the normal channels of trade--
      [(a) The Commodity Credit Corporation until December 31,
    1995, shall make available to the Secretary of Veterans Affairs
    at warehouses where dairy products are stored, such dairy
    products acquired under price-support programs as the Secretary
    certifies that he requires in order to provide butter and
    cheese and other dairy products as a part of the ration in
    hospitals under his jurisdiction. The Secretary shall report
    every six months to the Committee on Agriculture, Nutrition,
    and Forestry of the Senate and the Committee on Agriculture of
    the House of Representatives and the Secretary of Agriculture
    the amount of dairy products used under this subsection.
      [(b) The Commodity Credit Corporation until December 31,
    1995, shall make available to the Secretary of the Army, at
    warehouses where dairy products are stored, such dairy products
    acquired under price-support programs as the Secretary of the
    Army or his duly authorized representative certifies can be
    utilized in order to provide additional butter and cheese and
    other dairy products as a part of the ration (1) of the Army,
    Navy, Air Force, or Coast Guard, (2) in hospitals under the
    jurisdiction of the Department of Defense, and (3) of cadets
    and midshipmen at, and other personnel assigned to, the United
    States Merchant Marine Academy. The Secretary of the Army shall
    report every six months to the Committee on Agriculture,
    Nutrition, and Forestry of the Senate and the Committee on
    Agriculture of the House of Representatives and the Secretary
    of Agriculture the amount of dairy products used under this
    subsection.
      [(c) Dairy products made available under this section shall
    be made available without charge, except that the Secretary of
    the Army or the Secretary of Veterans Affairs shall pay the
    Commodity Credit Corporation the costs of packaging incurred in
    making such products so available.
      [(d) The obligation of the Commodity Credit Corporation to
    make dairy products available pursuant to the above shall be
    limited to dairy products acquired by the Corporation through
    price-support operations and not disposed of under provisions
    (1) and (2) of section 416 of this Act, as amended.

    [SEC. 203. COTTONSEED AND COTTONSEED OIL PRICE SUPPORT.

      [(a) In General.--If the Secretary determines that any
    oilseed program or programs cause, or are likely to cause, a
    reduction in prices received by producers for cottonseed or by
    processors for cottonseed oil, the Secretary shall take such
    actions as are necessary to offset the actual or anticipated
    impact of the program on prices for cottonseed or cottonseed
    oil. The actions shall only include actions to stabilize or
    increase the price of cottonseed, and shall not include actions
    to decrease the prices of other oilseeds.
      [(b) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through 1995 crops
    of upland cotton.

    [SEC. 204. MILK PRICE SUPPORT AND MILK INVENTORY MANAGEMENT PROGRAM FOR
                        CALENDAR YEARS 1991 THROUGH 1996.

      [Notwithstanding any other provision of law:
      [(a) In General.--During the period beginning on January 1,
    1991, and ending on December 31, 1996, the price of milk
    produced in the 48 contiguous States shall be supported as
    provided in this section.
      [(b) Rate.--During the period beginning on January 1, 1991,
    and ending on December 31, 1996, the price of milk shall be
    supported at a rate not less than $10.10 per hundredweight for
    milk containing 3.67 percent milkfat.
      [(c) Purchases.--
              [(1) In general.--The price of milk shall be
            supported through the purchase of milk and the products
            of milk produced in the 48 contiguous States.
              [(2) CCC bid prices.--The Commodity Credit
            Corporation support purchase prices under this section
            for each of the products of milk (butter, cheese, and
            nonfat dry milk) announced by the Corporation shall be
            the same for all of that product sold by persons
            offering to sell the product to the Corporation. The
            purchase prices shall be sufficient to enable plants of
            average efficiency to pay producers, on average, a
            price not less than the rate of price support for milk
            in effect during a 12-month period under this
            subsection.
              [(3) Butter and nonfat dry milk.--
                      [(A) Allocation of purchase prices.--Subject
                    to subparagraph (B), 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. 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.
                      [(B) Guidelines.--In the case of purchases of
                    butter and nonfat dry milk that are made by the
                    Secretary under this section on or after the
                    date of enactment of the Omnibus Budget
                    Reconciliation Act of 1993, in allocating the
                    rate of price support between the purchase
                    prices of butter and nonfat dry milk under this
                    paragraph, the Secretary may not--
                              [(i) offer to purchase butter for
                            more than $0.65 per pound; or
                              [(ii) offer to purchase nonfat dry
                            milk for less than $1.034 per pound.
                      [(C) 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.
      [(d) Support Rate Adjustments.--
              [(1) Reductions.--
                      [(A) In general.--Effective January 1 of each
                    of the calendar years 1991 through 1996, if the
                    level of purchases of milk and the products of
                    milk by the Commodity Credit Corporation under
                    this section (less sales under section 407 for
                    unrestricted use), as estimated by the
                    Secretary by November 20 of the preceding
                    calendar year, will exceed 5 billion pounds
                    (milk equivalent, total milk solids basis), the
                    Secretary shall decrease by an amount per
                    hundredweight of at least $0.25 but not more
                    than $0.50 the rate of price support for milk
                    in effect for the calendar year.
                      [(B) Prior notification.--The Secretary
                    shall, by November 20 of the preceding calendar
                    year, notify the Committee on Agriculture of
                    the House of Representatives and the Committee
                    on Agriculture, Nutrition, and Forestry of the
                    Senate of any proposed decrease in price
                    support under this paragraph.
              [(2) Increases.--
                      [(A) In general.--Effective January 1 of each
                    of the calendar years 1991 through 1996, if the
                    level of purchases of milk and the products of
                    milk by the Commodity Credit Corporation under
                    this section (less sales under section 407 for
                    unrestricted use), as estimated by the
                    Secretary by November 20 of the preceding
                    calendar year, will not exceed 3.5 billion
                    pounds (milk equivalent, total milk solids
                    basis), the Secretary shall increase by an
                    amount per hundredweight of at least $0.25 the
                    rate of price support for milk in effect for
                    the calendar year.
                      [(B) Prior notification.--The Secretary
                    shall, by November 20 of the preceding calendar
                    year, notify the Committee on Agriculture of
                    the House of Representatives and the Committee
                    on Agriculture, Nutrition, and Forestry of the
                    Senate of any proposed increase in price
                    support under this paragraph.
              [(3) No adjustments.--If for any of the calendar
            years 1992 through 1996, the level of purchases of milk
            and the products of milk by the Commodity Credit
            Corporation under this section (less sales under
            section 407 for unrestricted use), as estimated by the
            Secretary by November 20 of the preceding calendar
            year, will be less than 5 billion pounds (milk
            equivalent, total milk solids basis), but more than 3.5
            billion pounds (milk equivalent, total milk solids
            basis), the Secretary shall not decrease the rate of
            price support for milk in effect for the calendar year.
              [(4) Minimum price.--Notwithstanding any other
            provision of this section, in no event shall the price
            of milk be supported at less than $10.10 per
            hundredweight.
              [(5) Administration.--
                      [(A) Milk equivalent, total milk solids
                    basis.--As used in this section, the term
                    ``milk equivalent, total milk solids basis'',
                    of milk and the products of milk purchased by
                    the Commodity Credit Corporation, shall be
                    equal to the weighted-average of the milk
                    equivalent (as computed on a milkfat basis and
                    on a milk solids nonfat basis) of such
                    products, with weighting factors equal to not
                    more than 40 percent for the milk equivalent,
                    milkfat basis, and not more than 70 percent for
                    the milk equivalent, solids nonfat basis. The
                    weighting factors shall total 100 percent.
                      [(B) Level of purchases.--In estimating the
                    level of purchases of milk and the products of
                    milk under this section, the Secretary shall
                    deduct the amount, if any, by which the level
                    of imports into the 48 contiguous States and
                    the District of Columbia of milk and the
                    products of milk during the most recent
                    calendar year exceeds the annual average level
                    of imports into the 48 contiguous States and
                    the District of Columbia of milk and the
                    products of milk during the period January 1,
                    1986, through December 31, 1990 (milk
                    equivalent, total milk solids basis).
      [(e) Report on Milk Inventory Management Program.--
              [(1) In general.--Not later than August 1, 1991, the
            Secretary shall prepare and submit a report and
            recommendations on various milk inventory management
            programs to the Committee on Agriculture of the House
            of Representatives and Committee on Agriculture,
            Nutrition, and Forestry of the Senate.
              [(2) Solicitation of proposals.--Within 60 days after
            the date of enactment of this section, the Secretary
            shall publish in the Federal Register a notice to
            solicit proposals concerning a milk inventory
            management program.
              [(3) Required proposals.--In carrying out this
            subsection, the Secretary shall study, among other
            proposals--
                      [(A) an alternative classification of milk
                    contained in section 8c(5) of the Agricultural
                    Adjustment Act (7 U.S.C. 608c(5)), as amended
                    by the Agricultural Marketing Agreement Act of
                    1937;
                      [(B) a program to support the income of milk
                    producers through a system of established
                    prices and deficiency payments; and
                      [(C) other such programs submitted to the
                    Secretary under paragraph (2) as the Secretary
                    may determine appropriate after consultation
                    with the Committee on Agriculture of the House
                    of Representatives and the Committee on
                    Agriculture, Nutrition, and Forestry of the
                    Senate.
              [(4) Prohibited programs.--In the study required
            under paragraph (3), the Secretary shall not consider
            any milk inventory management program that includes any
            milk production termination program that is similar to
            the program established under section 201(d)(3), or
            support price reductions below the levels established
            under this section.
              [(5) Criteria for evaluation.--The Secretary shall
            evaluate the proposals for a milk inventory management
            program based on--
                      [(A) the ability of the program to limit
                    Government purchases of milk products to
                    6,000,000,000 pounds (milk equivalent, total
                    milk solids basis) in a calendar year;
                      [(B) the speed and effectiveness of reducing
                    excess milk production;
                      [(C) the effectiveness in sustaining reduced
                    milk production for at least a 5-year period
                    with and without the continuation of the
                    program;
                      [(D) the regional impact on milk prices,
                    producer revenue, and milk supplies;
                      [(E) the impact on national producer income
                    and Government expenditures;
                      [(F) the impact on the rural economy and
                    maintaining family farms;
                      [(G) the impact on the availability of
                    wholesome dairy products for domestic and
                    foreign nutrition and food assistance programs;
                      [(H) technological innovations;
                      [(I) the effectiveness in reducing butter fat
                    production and increasing protein content in
                    milk;
                      [(J) the impact of temporary increases and
                    decreases of milk production;
                      [(K) the impact on the United States
                    livestock industry; and
                      [(L) all other issues the Secretary considers
                    appropriate.
              [(6) Notice and comment.--The Secretary shall provide
            for public notice and comment on the milk inventory
            programs studied by the Secretary under this subsection
            no later than June 1, 1991.
      [(f) Notification of Congress Concerning Estimated
    Purchases.--On August 1 and by November 20 of each of the
    calendar years 1991 through 1995, the Secretary shall notify
    the Committee on Agriculture of the House of Representatives
    and the Committee on Agriculture, Nutrition, and Forestry of
    the Senate regarding the value and volume of dairy product
    purchases on a milk equivalent, total milk solids basis, the
    Secretary estimates that the Corporation will make during the
    upcoming calendar year.
      [(g) Excess Purchases.--
              [(1) In general.--In order to offset any cost to the
            Commodity Credit Corporation associated with the
            purchase (less sales under section 407 for unrestricted
            use) of milk and the products of milk in excess of
            7,000,000,000 pounds (milk equivalent, total milk
            solids basis), during any of the calendar years 1992
            through 1996, the Secretary shall, if necessary,
            provide for a reduction to be made in the price
            received by producers for all milk produced in the 48
            contiguous States and marketed by producers for
            commercial use.
              [(2) Calculation.--If on November 20 of each of the
            calendar years 1991 through 1996, the Secretary
            estimates that the level of Commodity Credit
            Corporation purchases (less sales under section 407 for
            unrestricted use) in the following calendar year of
            milk and the products of milk will exceed 7,000,000,000
            pounds (milk equivalent, total milk solids basis), the
            amount of reduction in the price received by producers
            in such following calendar year shall be an amount per
            hundredweight calculated by dividing--
                      [(A) the cost of the purchases (less sales
                    under section 407 for unrestricted use) in
                    excess of 7,000,000,000 pounds, milk
                    equivalent, total milk solids basis; by
                      [(B) the total quantity of hundredweights of
                    milk the Secretary estimates will be produced
                    and marketed in the United States for
                    commercial use in such following calendar year.
              [(3) Adjustments.--The Secretary shall adjust any
            such assessment in future years, or refund any portion
            of such assessments, as needed, to carry out the
            purposes of this subsection.
      [(h) Reduction in Price Received.--
              [(1) In general.--Beginning January 1, 1991, the
            Secretary shall provide for a reduction in the price
            received by producers for all milk produced in the 48
            contiguous States and marketed by producers for
            commercial use, in addition to any reduction in price
            required under subsection (g).
              [(2) Amount.--The amount of the reduction under
            paragraph (1) in the price received by producers shall
            be--
                      [(A) during calendar year 1991, 5 cents per
                    hundredweight of milk marketed;
                      [(B) during each of the calendar years 1992
                    through 1995, 11.25 cents per hundredweight of
                    milk marketed, which rate shall be adjusted on
                    or before May 1 of each of the calendar years
                    1992 through 1995 by an amount per
                    hundredweight that is necessary to compensate
                    for refunds made under paragraph (3) on the
                    basis of marketings in the previous calendar
                    year; and
                      [(C) during each of calendar years 1996 and
                    1997, 10 cents per hundredweight of milk
                    marketed, which rate shall be adjusted on or
                    before May 1 of the respective calendar year in
                    the manner provided in subparagraph (B).
              [(3) Refund.--The Secretary shall provide a refund of
            the entire reduction under paragraph (2) in the price
            of milk received by a producer during a calendar year,
            if the producer provides evidence that the producer did
            not increase marketings in the calendar year that such
            reduction was in effect when compared to the
            immediately preceding calendar year. A refund under
            this subsection shall not be considered as any type of
            price support or payment for purposes of sections 1211
            and 1221 of the Food Security Act of 1985 (16 U.S.C.
            3811 and 3821).
      [(i) Enforcement.--
              [(1) Collection.--Reductions in price required under
            subsection (g) or (h) shall be collected and remitted
            to the Commodity Credit Corporation in the manner
            prescribed by the Secretary.
              [(2) Penalties.--If any person fails to collect or
            remit the reduction required by subsection (g) or (h)
            or fails to comply with such requirements for
            recordkeeping or otherwise as are required by the
            Secretary to carry out such subsection, the person
            shall be liable to the Secretary for a civil penalty up
            to an amount determined by multiplying--
                      [(A) the quantity of milk involved in the
                    violation; by
                      [(B) the support rate for the applicable
                    calendar year for milk.
              [(3) Enforcement.--The Secretary may enforce
            subsection (g) or (h) in the courts of the United
            States.
      [(j) Use of Commodity Credit Corporation.--The Secretary
    shall use the funds, facilities, and authorities of the
    Commodity Credit Corporation to carry out this section.
      [(k) Period.--Notwithstanding any other provision of law,
    this section shall be effective only during the period
    beginning on January 1, 1991, and ending on December 31, 1996.

    [SEC. 205. LOANS AND PAYMENTS FOR OILSEEDS FOR 1991 THROUGH 1995
                        MARKETING YEARS.

      [(a) Definition of Oilseeds.--As used in this section, the
    term ``oilseeds'' means soybeans, sunflower seed, canola,
    rapeseed, safflower, flaxseed, mustard seed, and such other
    oilseeds as the Secretary may determine.
      [(b) In General.--The Secretary shall support the price of
    oilseeds through nonrecourse loans to producers on a farm for
    oilseeds produced on the farm in each of the 1991 through 1995
    marketing years as provided in this section.
      [(c) Loan Level.--The loan level for each of the 1991 through
    1995 crops of--
              [(1) soybeans shall not be less than $5.02 per bushel
            for each of the 1991 through 1993 crops and $4.92 per
            bushel for each of the 1994 through 1997 crops;
              [(2) sunflower seed, canola, rapeseed, safflower,
            mustard seed, and flaxseed, individually, shall not be
            less than $0.089 per pound for each of the 1991 through
            1993 crops and $0.087 per pound for each of the 1994
            through 1997 crops; and
              [(3) other oilseeds shall be established at such
            level as the Secretary determines is fair and
            reasonable in relation to the loan level available for
            soybeans, except in no event shall the level for such
            oilseeds (other than cottonseed) be less than the level
            established for soybeans on a per-pound basis for the
            same crop year.
    To ensure that producers have an equitable opportunity to
    produce an alternative crop in areas of limited crop options,
    the Secretary may limit, insofar as practicable, adjustments in
    the loan rate established under paragraph (2) applicable to a
    particular region, State, or county for the purpose of
    reflecting transportation differentials such that the regional,
    State, or county loan rate does not increase or decrease by
    more than 9 percent from the basic national loan rate.
      [(d) Marketing Loan Provisions.--
              [(1) In general.--The Secretary shall permit a
            producer to repay a loan made under this section for a
            crop--
                      [(A) at a level that is the lesser of--
                              [(i) the loan level determined for
                            the crop; or
                              [(ii) the prevailing world market
                            price for the applicable oilseed
                            (adjusted to United States quality and
                            location), as determined by the
                            Secretary; or
                      [(B) such other level (not in excess of the
                    loan level determined for the crop) that the
                    Secretary determines will--
                              [(i) minimize potential loan
                            forfeitures;
                              [(ii) minimize the accumulation of
                            oilseed stocks by the Federal
                            Government;
                              [(iii) minimize the cost incurred by
                            the Federal Government in storing
                            oilseeds; and
                              [(iv) allow oilseeds produced in the
                            United States to be marketed freely and
                            competitively, both domestically and
                            internationally.
              [(2) Prevailing world market price.--The Secretary
            shall prescribe by regulation--
                      [(A) a formula to define the prevailing world
                    market price for oilseeds (adjusted to United
                    States quality and location); and
                      [(B) a mechanism by which the Secretary shall
                    announce periodically the prevailing world
                    market price for oilseeds (adjusted to United
                    States quality and location).
      [(e) Loan Deficiency Payment.--
              [(1) In general.--The Secretary shall, for each of
            the 1991 through 1995 crops of oilseeds, make payments
            available to producers who, although eligible to obtain
            a loan under subsection (b), agree to forgo obtaining
            the loan in return for payments under this subsection.
              [(2) Computation.--A payment under this subsection
            shall be computed by multiplying--
                      [(A) the loan payment rate; by
                      [(B) the quantity of oilseeds the producer is
                    eligible to place under loan but for which the
                    producer forgoes obtaining the loan in return
                    for payments under this subsection.
              [(3) Loan payment rate.--For purposes of this
            subsection, the loan payment rate shall be the amount
            by which--
                      [(A) the loan level determined for the crop
                    under subsection (c); exceeds
                      [(B) the level at which a loan may be repaid
                    under subsection (d).
              [(4) Marketing certificates.--
                      [(A) In general.--The Secretary may make
                    payments under this section available in the
                    form of certificates redeemable for any
                    agricultural commodity owned by the Commodity
                    Credit Corporation.
                      [(B) Minimal oilseed stocks.--The Secretary
                    shall make certificates available under
                    subparagraph (A) in such a manner so as to
                    minimize the accumulation of oilseeds stocks.
      [(f) Marketing Year.--For purposes of this section, the
    marketing year for--
              [(1) soybeans shall be the 12-month period beginning
            on September 1 and ending on August 31; and
              [(2) other oilseeds shall be prescribed by the
            Secretary by regulation.
      [(g) Announcements.--
              [(1) In general.--Except as provided in paragraph
            (2), the Secretary shall make an announcement of the
            loan level for the crop not later than November 15
            prior to the calendar year in which the crop is
            harvested.
              [(2) 1991 crop.--In the case of the 1991 crop, the
            Secretary shall make an announcement of the loan level
            for the crop as soon as practicable after the date of
            enactment of this section.
      [(h) Loan Maturity.--A loan made for a crop of oilseeds under
    this section shall mature--
              [(1) in the case of each of the 1991 through 1993
            crops, on the last day of the 9th month following the
            month the application for the loan is made; and
              [(2) in the case of each of the 1994 through 1997
            crops, on the last day of the 9th month following the
            month the application for the loan is made, except that
            the loan may not mature later than the last day of the
            fiscal year in which the application is made.
      [(i) Other Terms and Conditions.--Notwithstanding any other
    provision of law--
              [(1) the Secretary shall not require participation in
            any production adjustment program for oilseeds or any
            other commodity as a condition of eligibility for price
            support for oilseeds;
              [(2) the Secretary may not authorize payments to
            producers to cover the cost of storing oilseeds; and
              [(3) oilseeds may not be considered an eligible
            commodity for any reserve program.
      [(j) Regulations.--The Secretary may issue such regulations
    as the Secretary determines necessary to carry out this
    section.
      [(k) Commodity Credit Corporation.--The Secretary shall carry
    out the program authorized by this section through the
    Commodity Credit Corporation.
      [(l) 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 under this section.
      [(m) Loan Origination Fee.--
              [(1) Loans.--The Secretary shall charge a producer a
            loan origination fee for a crop of oilseeds, in
            connection with making a loan, equal to the product
            obtained by multiplying--
                      [(A) the loan level determined for the crop
                    under subsection (c); by
                      [(B) 2 percent; by
                      [(C) the quantity of oilseeds for which the
                    producer obtains the loan.
              [(2) Loan deficiency payments.--The Secretary shall
            deduct, from the amount of any loan deficiency payment
            made under subsection (e), an amount equal to the
            amount of the loan origination fee that would otherwise
            be paid under paragraph (1) if the producer obtained a
            loan rather than a loan deficiency payment.
              [(3) Applicability.--This subsection shall apply only
            to each of the 1991 through 1993 crops of oilseeds.
      [(n) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through 1995 crops
    of oilseeds.

    [SEC. 206. SUGAR PRICE SUPPORT FOR 1991 THROUGH 1997 CROPS.

      [(a) In General.--The price of each of the 1991 through 1997
    crops of sugar beets and sugarcane, respectively, shall be
    supported in accordance with this section.
      [(b) Sugarcane.--The Secretary shall support the price of
    domestically grown sugarcane through nonrecourse loans at such
    level as the Secretary determines appropriate, but not less
    than 18 cents per pound for raw cane sugar.
      [(c) Sugar Beets.--The Secretary shall support the price of
    each of the 1991 through 1997 crops of domestically grown sugar
    beets through nonrecourse loans at such level for each such
    crop as the Secretary determines reflects--
              [(1) an amount that bears the same relation to the
            support level for the crop of sugarcane under
            subsection (b) as the weighted average of producer
            returns for sugar beets bears to the weighted average
            of producer returns for sugarcane, expressed on a cents
            per pound basis for refined beet sugar and raw cane
            sugar, for the most recent 5-year period for which data
            are available; plus
              [(2) an amount that covers sugar beet processor fixed
            marketing expenses.
      [(d) Adjustment in Support Price.--
              [(1) In general.--The Secretary may increase the
            support price for each of the 1991 through 1997 crops
            of domestically grown sugarcane and sugar beets from
            the price determined for the preceding crop based on
            such factors as the Secretary determines appropriate,
            including changes (during the 2 crop years immediately
            preceding the crop year for which the determination is
            made) in the cost of sugar products, the cost of
            domestic sugar production, and other circumstances that
            may adversely affect domestic sugar production.
              [(2) Report.--If the Secretary makes a determination
            not to increase the support price under paragraph (1),
            the Secretary shall submit a report containing the
            findings, decision, and supporting data for the
            determination to the Committee on Agriculture of the
            House of Representatives and the Committee on
            Agriculture, Nutrition, and Forestry of the Senate.
      [(e) Announcements.--The Secretary shall announce the basic
    loan rates for beet sugar and cane sugar to be applicable
    during any fiscal year under this section as far in advance of
    the beginning of that fiscal year as is practicable consistent
    with the purposes of this section.
      [(f) Term.--Except as provided in subsection (g), loans under
    this section during any fiscal year shall be made available not
    earlier than the beginning of the fiscal year and shall mature
    at the earlier of--
              [(1) the end of 9 months; or
              [(2) the end of the fiscal year.
      [(g) Supplementary Nonrecourse Loans.--The Secretary shall
    make available to eligible processors price support loans with
    respect to sugar processed from sugar beets and sugarcane
    harvested in the last 3 months of a fiscal year. Such loans
    shall mature at the end of the fiscal year. The processor may
    repledge the sugar as collateral for a price support loan in
    the subsequent fiscal year, except that the second loan shall--
              [(1) be made at the loan rate in effect at the time
            the second loan is made; and
              [(2) mature in 9 months less the quantity of time
            that the first loan was in effect.
      [(h) Use of Commodity Credit Corporation.--The Secretary
    shall use the funds, facilities, and authorities of the
    Commodity Credit Corporation to carry out this section.
      [(i) Marketing Assessment.--
              [(1) Sugarcane.--Effective only for marketings of raw
            cane sugar during the 1992 through 1996 fiscal years,
            the first processor of sugarcane shall remit to the
            Commodity Credit Corporation a nonrefundable marketing
            assessment in an amount equal to--
                      [(A) in the case of marketings during each of
                    fiscal years 1992 through 1994, 1.0 percent of
                    the loan level established under subsection (b)
                    per pound of raw cane sugar (but not more than
                    .18 cents per pound of raw cane sugar),
                    processed by the processor from domestically
                    produced sugarcane or sugarcane molasses, that
                    has been marketed (including the transfer or
                    delivery of the sugar to a refinery for further
                    processing or marketing); and
                      [(B) in the case of marketings during each of
                    fiscal years 1995 through 1998, 1.1 percent of
                    the loan level established under subsection (b)
                    per pound of raw cane sugar (but not more than
                    .198 cents per pound of raw cane sugar),
                    processed by the processor from domestically
                    produced sugarcane or sugarcane molasses, that
                    has been marketed (including the transfer or
                    delivery of the sugar to a refinery for further
                    processing or marketing).
              [(2) Sugar beets.--Effective only for marketings of
            beet sugar during the 1992 through 1996 fiscal years,
            the first processor of sugar beets shall remit to the
            Commodity Credit Corporation a nonrefundable marketing
            assessment in an amount equal to--
                      [(A) in the case of marketings during each of
                    fiscal years 1992 through 1994, 1.0722 percent
                    of the loan level established under subsection
                    (b) per pound of beet sugar (but not more than
                    .193 cents per pound of beet sugar), processed
                    by the processor from domestically produced
                    sugar beets or sugar beet molasses, that has
                    been marketed; and
                      [(B) in the case of marketings during each of
                    fiscal years 1995 through 1998, 1.1794 percent
                    of the loan level established under subsection
                    (b) per pound of beet sugar (but not more than
                    .2123 cents per pound of beet sugar), processed
                    by the processor from domestically produced
                    sugar beets or sugar beet molasses, that has
                    been marketed.
              [(3) Collection.--
                      [(A) Timing.--Marketing assessments required
                    under this subsection shall be collected on a
                    monthly basis and shall be remitted to the
                    Commodity Credit Corporation within 30 days
                    after the end of each month. Any cane sugar or
                    beet sugar processed during a fiscal year that
                    has not been marketed by September 30 of that
                    year shall be subject to assessment on that
                    date. The sugar shall not be subject to a
                    second assessment at the time that it is
                    marketed.
                      [(B) Manner.--Subject to subparagraph (A),
                    marketing assessments shall be collected under
                    this subsection in the manner prescribed by the
                    Secretary and shall be nonrefundable.
              [(4) Penalties.--If any person fails to remit the
            assessment required by this subsection or fails to
            comply with such requirements for recordkeeping or
            otherwise as are required by the Secretary to carry out
            this subsection, the person shall be liable to the
            Secretary for a civil penalty up to an amount
            determined by multiplying--
                      [(A) the quantity of cane sugar or beet sugar
                    involved in the violation; by
                      [(B) the support level for the applicable
                    crop of sugarcane or sugar beets.
              [(5) Enforcement.--The Secretary may enforce this
            subsection in the courts of the United States.
              [(6) Excess marketings.--In addition to the
            assessment required under paragraph (1) or (2), a
            processor who knowingly markets sugar in excess of the
            allocated allotment of the processor under section 359d
            of the Agricultural Adjustment Act of 1938 (7 U.S.C.
            1359dd) shall pay an assessment in an amount that is
            double the applicable assessment required under
            paragraph (1) or (2) per pound of sugar marketed.
      [(j) Crops.--This section shall be effective only for the
    1991 through 1997 crops of sugar beets and sugarcane.

    [SEC. 207. HONEY PRICE SUPPORT.

      [(a) In General.--For each of the 1991 through 1998 crops of
    honey, the price of honey shall be supported through loans,
    purchases, or other operations at not less than--
              [(1) 53.8 cents per pound for each of the 1991
            through 1993 crop years;
              [(2) 50 cents per pound for each of the 1994 and 1995
            crop years;
              [(3) 49 cents per pound for the 1996 crop year;
              [(4) 48 cents per pound for the 1997 crop year; and
              [(5) 47 cents per pound for the 1998 crop year.
      [(b) Marketing Loan Provisions.--The Secretary may permit a
    producer to repay a loan made to the producer under this
    section for a crop at a level that is the lesser of--
              [(1) the loan level determined for the crop; or
              [(2) such level as the Secretary determines will--
                      [(A) minimize the number of loan forfeitures;
                      [(B) not result in excessive total stocks of
                    honey;
                      [(C) reduce the costs incurred by the Federal
                    Government in storing honey; and
                      [(D) maintain the competitiveness of honey in
                    the domestic and export markets.
      [(c) Loan Deficiency Payments.--
              [(1) In general.--The Secretary shall, for each of
            the 1991 through 1998 crops of honey, make payments
            available to producers who, although eligible to obtain
            a loan under subsection (b), agree to forgo obtaining
            the loan in return for payments under this subsection.
              [(2) Computation.--A payment under this subsection
            shall be computed by multiplying--
                      [(A) the loan payment rate; by
                      [(B) the quantity of honey the producer is
                    eligible to place under loan but for which the
                    producer forgoes obtaining the loan in return
                    for payments under this subsection.
              [(3) Loan payment rate.--For purposes of this
            subsection, the loan payment rate shall be the amount
            by which--
                      [(A) the loan level determined for the crop
                    under subsection (a); exceeds
                      [(B) the level at which a loan may be repaid
                    under subsection (b).
              [(4) Marketing certificates.--The Secretary may make
            payments under this section available in the form of
            certificates redeemable for any agricultural commodity
            owned by the Commodity Credit Corporation.
      [(d) Pledging Adulterated or Imported Honey as Collateral.--
              [(1) In general.--If the Secretary determines that a
            person has knowingly pledged adulterated or imported
            honey as collateral to secure a loan made under this
            section, the person, in addition to any other penalty
            or sanction prescribed by law, shall be ineligible for
            a loan, purchase, or payment under this section for the
            3 crop years succeeding the determination.
              [(2) Adulterated honey.--For purposes of paragraph
            (1), honey shall be considered adulterated if--
                      [(A) any substance has been substituted
                    wholly or in part for the honey;
                      [(B) the honey contains a poisonous or
                    deleterious substance that may render the honey
                    injurious to health, except that in any case in
                    which the substance is not added to the honey,
                    the honey shall not be considered adulterated
                    if the quantity of the substance in or on the
                    honey does not ordinarily render it injurious
                    to health; or
                      [(C) for any other reason, the honey is
                    unsound, unhealthy, unwholesome, or otherwise
                    unfit for human consumption.
      [(e) Payment Limitations.--
              [(1) In general.--The total amount of payments that a
            person may receive under this section may not exceed--
                      [(A) $200,000 in the 1991 crop year;
                      [(B) $175,000 in the 1992 crop year;
                      [(C) $150,000 in the 1993 crop year;
                      [(D) $125,000 in the 1994 crop year;
                      [(E) $100,000 in the 1995 crop year;
                      [(F) $75,000 in the 1996 crop year; and
                      [(G) $50,000 in each of the 1997 and 1998
                    crop years.
              [(2) Payments.--For the purposes of this subsection,
            the term ``payments'' means--
                      [(A) any gain realized by a producer from
                    repaying a loan for a crop of honey at a lower
                    level than the original loan level under this
                    section; and
                      [(B) any loan deficiency payment received
                    under subsection (c).
              [(3) Person.--The Secretary shall issue regulations
            defining the term ``person'' for the purposes of this
            section. The regulations shall provide for the
            attribution of payments received under this section.
      [(f) Regulations.--The Secretary may issue such regulations
    as the Secretary determines necessary to carry out this
    section.
      [(g) Commodity Credit Corporation.--The Secretary shall carry
    out the program authorized by this section through the
    Commodity Credit Corporation.
      [(h) 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 under this section.
      [(i) Marketing Assessment.--
              [(1) In general.--Effective only for each of the 1991
            through 1993 crops of honey, producers and producer-
            packers of honey (as defined in paragraphs (5) and (9),
            respectively, of section 3 of the Honey Research,
            Promotion, and Consumer Information Act (7 U.S.C.
            4602)) shall remit to the Commodity Credit Corporation
            a nonrefundable marketing assessment on a per pound
            basis in an amount equal to 1 percent of the national
            price support level for each such crop as otherwise
            provided in this section.
              [(2) Collection.--The assessment shall be collected
            and remitted by the first handler of honey in the
            manner prescribed by the Secretary which, to the extent
            practicable, shall be as provided for in the Honey
            Research, Promotion, and Consumer Information Act.
              [(3) Exemptions.--All persons who are exempt from the
            payment of the assessment authorized by such Act, and
            all imported honey, shall be exempt from the payment of
            the assessment required by this subsection.
              [(4) Penalties.--If any person fails to collect or
            remit the reduction required by this subsection or
            fails to comply with such requirements for
            recordkeeping or otherwise as are required by the
            Secretary to carry out this subsection, the person
            shall be liable to the Secretary for a civil penalty up
            to an amount determined by multiplying--
                      [(A) the quantity of honey involved in the
                    violation; by
                      [(B) the support level for the applicable
                    crop of honey.
              [(5) Enforcement.--The Secretary may enforce this
            subsection in the courts of the United States.
      [(j) Crops.--Notwithstanding any other provision of law, this
    section shall be effective only for the 1991 through 1998 crops
    of honey.

              [TITLE III--OTHER NONBASIC AGRICULTURAL COMMODITIES

      [Sec. 301. The Secretary is authorized to make available
    through loans, purchases, or other operations price support to
    producers for any nonbasic agricultural commodity not
    designated in title II at a level not in excess of 90 per
    centum of the parity price for the commodity.
      [Sec. 302. Without restricting price support to those
    commodities for which a marketing quota or marketing agreement
    or order program is in effect, price support shall, insofar as
    feasible, be made available to producers of any storable
    nonbasic agricultural commodity for which such a program is in
    effect and who are complying with such program. The level of
    such support shall not be in excess of 90 per centum of the
    parity price of such commodity nor less than the level provided
    in the following table:

    [If the supply perceThe level of support shall be not less than the is:
                        following percentage of the parity price:

        Not more than 102.........................................       90
        More than 102 but not more than 104.......................       89
        More than 104 but not more than 106.......................       88
        More than 106 but not more than 108.......................       87
        More than 108 but not more than 110.......................       86
        More than 110 but not more than 112.......................       85
        More than 112 but not more than 114.......................       84
        More than 114 but not more than 116.......................       83
        More than 116 but not more than 118.......................       82
        More than 118 but not more than 120.......................       81
        More than 120 but not more than 122.......................       80
        More than 122 but not more than 124.......................       79
        More than 124 but not more than 126.......................       78
        More than 126 but not more than 128.......................       77
        More than 128 but not more than 130.......................       76
        More than 130.............................................       75

    Provided, That the level of price support may be less than the
    minimum level provided in the foregoing table if the Secretary,
    after examination of the availability of funds for mandatory
    price support programs and consideration of the other factors
    specified in section 401(b), determines that such lower level
    is desirable and proper.
      [Sec. 303. In determining the level of price support for any
    nonbasic agricultural commodity under this title, particular
    consideration shall be given to the levels at which the prices
    of competing agricultural commodities are being supported.

                            [TITLE IV--MISCELLANEOUS

      [Sec. 401. (a) The Secretary shall provide the price support
    authorized or required herein through the Commodity Credit
    Corporation and other means available to him.
      [(b) Except as otherwise provided in this Act, the amounts,
    terms, and conditions of price support operations and the
    extent to which such operations are carried out, shall be
    determined or approved by the Secretary. The following factors
    shall be taken into consideration in determining, in the case
    of any commodity for which price support is discretionary,
    whether a price-support operation shall be undertaken and the
    level of such support and, in the case of any commodity for
    which price support is mandatory, the level of support in
    excess of the minimum level prescribed for such commodity: (1)
    the supply of the commodity in relation to the demand therefor,
    (2) the price levels at which other commodities are being
    supported and, in the case of feed grains, the feed values of
    such grains in relation to corn, (3) the availability of funds,
    (4) the perishability of the commodity, (5) the importance of
    the commodity to agriculture and the national economy, (6) the
    ability to dispose of stocks acquired through a price-support
    operation, (7) the need for offsetting temporary losses of
    export markets, (8) the ability and willingness of producers to
    keep supplies in line with demand, and (9) in the case of
    upland cotton, changes in the cost of producing such cotton.
      [(c) Compliance by the producer with acreage allotments,
    production goals and marketing practices (including marketing
    quotas when authorized by law), prescribed by the Secretary,
    may be required as a condition of eligibility for price
    support. In administering any program for diverted acres the
    Secretary may make his regulations applicable on an appropriate
    geographical basis. Such regulations shall be administered (1)
    in semiarid or other areas where good husbandry requires
    maintenance of a prudent feed reserve in such manner as to
    permit, to the extent so required by good husbandry, the
    production of forage crops for storage and subsequent use
    either on the farm or in feeding operations of the farm
    operator, and (2) in areas declared to be disaster areas by the
    President under the Disaster Relief and Emergency Assistance
    Act, in such manner as will most quickly restore the normal
    pattern of their agriculture.
      [(d) The level of price support for any commodity shall be
    determined upon the basis of its parity price as of the
    beginning of the marketing year or season in the case of any
    commodity marketed on a marketing year or season basis and as
    of January 1 in the case of any other commodity.
      [(e)(1) Whenever any price support or surplus removal
    operation for any agricultural commodity is carried out through
    purchases from or loans or payments to processors, the
    Secretary shall, to the extent practicable, obtain from the
    processors such assurances as he deems adequate that the
    producers of the agricultural commodity involved have received
    or will receive maximum benefits from the price support or
    surplus removal operation.
      [(2)(A) If the assurances under paragraph (1) are not
    adequate to cause the producers of sugar beets and sugarcane,
    because of the bankruptcy or other insolvency of the processor,
    to receive maximum benefits from the price support program
    within 30 days after the final settlement date provided for in
    the contract between such producers and processor, the
    Secretary, on demand made by such producers and on such
    assurances as to nonpayment as the Secretary shall require,
    shall pay such producers such maximum benefits less benefits
    previously received by such producers.
      [(B) On such payment, the Secretary shall--
              [(i) be subrogated to all claims of such producers
            against the processor and other persons responsible for
            nonpayment; and
              [(ii) have authority to pursue such claims as
            necessary to recover the benefits not paid to the
            producers.
      [(C) The Secretary shall carry out this paragraph through the
    Commodity Credit Corporation.
      [Sec. 402. (a) Notwithstanding any other provision of this
    Act, price support at a level in excess of the maximum level of
    price support otherwise prescribed in this Act may be made
    available for any agricultural commodity if the Secretary
    determines, after a public hearing of which reasonable notice
    has been given, that price support at such increased level is
    necessary in order to prevent or alleviate a shortage in the
    supply of any agricultural commodity essential to the national
    welfare or in order to increase or maintain the production of
    any agricultural commodity in the interest of national
    security. The Secretary's determination and the record of the
    hearing shall be available to the public.
      [(b) Effective only for the 1991 through 1995 crops of wheat,
    feed grains, cotton, and rice, the Secretary of Agriculture may
    provide for annual adjustments in the established prices for
    such program crops to reflect any change during the last
    calendar year ending before the beginning of each such crop
    year in the index of prices paid by farmers for production
    items, interest, taxes, and wage rates in such calendar year.

    [SEC. 403. ADJUSTMENTS OF SUPPORT PRICES.

      [(a) In General.--The Secretary may make appropriate
    adjustments in the support price for any commodity (excluding
    cotton) for differences in grade, type, quality, location and
    other factors. The adjustments shall, so far as practicable, be
    made in such manner that the average support price for the
    commodity will, on the basis of the anticipated incidence of
    such factors be equal to the level of support determined as
    provided in this Act. Beginning with the 1991 crops of wheat,
    feed grains, and soybeans for which price support is provided
    under this Act, the Secretary shall establish premiums and
    discounts related to cleanliness factors in addition to any
    other premiums or discounts related to quality.
      [(b) Adjustment in Support Prices for Cotton.--The Secretary
    may make appropriate adjustments in the support price for
    cotton for differences in quality factors and location.
    Beginning with the 1991 crop, the quality differences (premiums
    and discounts for quality factors) for the upland cotton loan
    program shall be established by the Secretary by giving equal
    weight to (1) loan differences for the preceding crop, and (2)
    market differences for such crop in the designated United
    States spot markets.
      [(c) Limitation on Adjustments for Wheat and Feed Grains.--
    Notwithstanding any other provision of this section, for each
    of the 1990 through 1995 crops of wheat and feed grains, no
    adjustment in the loan rate applicable to a particular region,
    State, or county for the purpose of reflecting transportation
    differentials may increase or decrease the regional, State, or
    county loan rate from the level established for the previous
    year by more than the percentage change in the national average
    loan rate plus or minus 3 percent.
      [Sec. 404. The Secretary, in carrying out programs under
    section 32 of Public Law Numbered 320, Seventy-fourth Congress,
    approved August 24, 1935, as amended, and section 6 of the
    National School Lunch Act may utilize the services and
    facilities of the Commodity Credit Corporation (including but
    not limited to procurement by contract), and make advance
    payments to it.
      [Sec. 405. (a) Except as otherwise provided in section 405A,
    no producer shall be personally liable for any deficiency
    arising from the sale of the collateral securing any loan made
    under authority of this Act unless such loan was obtained
    through fraudulent representations by the producer. This
    provision shall not, however, be construed to prevent the
    Commodity Credit Corporation or the Secretary from requiring
    producers to assume liability for deficiencies in the grade,
    quality, or quantity of commodities stored on the farm or
    delivered by them, for failure properly to care for and
    preserve commodities, or for failure or refusal to deliver
    commodities in accordance with the requirements of the program.
    There is authorized to be included in the terms and conditions
    of any such nonrecourse loan a provision whereby on and after
    the maturity of the loan or any extension thereof Commodity
    Credit Corporation shall have the right to acquire title to the
    unredeemed collateral without obligation to pay for any market
    value which such collateral may have in excess of the loan
    indebtedness.
      [(b) Sugarcane and Sugar Beets.--The security interests
    obtained by the Commodity Credit Corporation as a result of the
    execution of security agreements by the processors of sugarcane
    and sugar beets shall be superior to all statutory and common
    law liens on raw cane sugar and refined beet sugar in favor of
    the producers of sugarcane and sugar beets and all prior
    recorded and unrecorded liens on the crops of sugarcane and
    sugar beets from which the sugar was derived. The preceding
    sentence shall not affect the application of section 401(e)(2).
      [Sec. 405A. (a) A producer of honey may satisfy the
    producer's obligation to repay a loan, or a portion of a loan,
    made to the producer under section 207 by forfeiting the
    collateral for the loan, or portion of the loan, only if the
    value of the collateral forfeited, when taken together with the
    value of the collateral forfeited on any other loan or loans of
    the person for such crop of honey under section 207, does not
    exceed $200,000 in the 1991 crop year, $175,000 in the 1992
    crop year, $150,000 in the 1993 crop year, and $125,000 in each
    of the 1994 and subsequent crop years: Provided, however, That
    the loan forfeiture limitation provided by this section shall
    not be applicable for any crop year for which the Secretary
    does not permit producers of honey to repay the price support
    loans at a level determined under section 207(b)(2).
      [(b) The producer of honey shall be personally liable for the
    repayment of a loan or loans made to the producer under the
    program for the crop of honey involved, with respect to that
    portion of the loan or loans for which satisfaction of the loan
    by forfeiture, as provided in subsection (a), is prohibited.
      [(c) The loan contracts of the Commodity Credit Corporation
    entered into with producers of honey shall clearly indicate the
    extent to which a producer of honey may be personally liable
    for repayment of a loan under this section.
      [(d) The Commodity Credit Corporation may issue such
    regulations as the Corporation deems necessary to carry out
    this section. The regulations shall provide for the attribution
    of the value of collateral forfeited on loans described in
    subsection (a).
      [Sec. 406. (a) The Secretary shall, insofar as practicable,
    announce the level of price support for field crops in advance
    of the planting season and for other agricultural commodities
    in advance of the beginning of the marketing year or season
    (January 1 in the case of commodities not marketed on a
    marketing year or season basis), but the level of price support
    so announced shall not exceed the estimated maximum level of
    price support specified in this Act, based upon the latest
    information and statistics available to the Secretary when such
    level of price support is announced; and the level of price
    support so announced shall not be reduced if the maximum level
    of price support when determined, is less than the level so
    announced.
      [(b)(1) Notwithstanding any other provision of law, the
    Secretary may offer an option to producers of the 1996 crop of
    wheat, feed grains, upland cotton, extra long staple cotton,
    rice, or oilseeds and to dairy producers for the 1996 calendar
    year to participate in commodity price support, production
    adjustment, and payment programs as provided in this
    subsection.
      [(2) The Secretary may offer such programs based on the terms
    and conditions as are provided in sections 101(h), 101B, 103B,
    105B, 107B, 114, 204, and 205 of the Agricultural Act of 1949,
    and any other relevant provisions of the Agricultural Act of
    1949, as determined by the Secretary. Any established price or
    loan and purchase level made available in accordance with this
    subsection shall be established at the same level as that
    established for the 1995 crop or, in the case of milk, for the
    1995 calendar year.
      [(3) The Secretary may offer each of the programs provided
    for by this subsection if the Secretary has not made final
    announcement of the terms of the commodity price support,
    production adjustment, or payment programs for the 1996 crops
    of wheat, feed grains, cotton, rice, or oilseeds, or the 1996
    calendar year for dairy on or before the later of--
              [(A) in the case of wheat, June 1, 1995;
              [(B) in the case of feed grains, September 30, 1995;
              [(C) in the case of upland cotton, November 1, 1995;
              [(D) in the case of extra long staple cotton,
            December 1, 1995;
              [(E) in the case of rice, January 31, 1996;
              [(F) in the case of oilseeds, July 15, 1995; and
              [(G) in the case of dairy, November 1, 1995.
      [(4) Producers may not participate in such programs unless a
    law has been enacted subsequent to November 28, 1990, that
    provides for loans and purchases for the 1996 crop of wheat,
    feed grains, cotton, rice, or oilseeds, or for dairy for the
    1996 calendar year.
      [(5) The Secretary may use the funds, facilities and
    authorities of the Commodity Credit Corporation in carrying out
    this subsection.

    [SEC. 407. COMMODITY CREDIT CORPORATION SALES PRICE RESTRICTIONS.

      [(a) In General.--The Commodity Credit Corporation may sell
    any farm commodity owned or controlled by the Corporation at
    any price not prohibited by this section.
      [(b) Inventories.--In determining sales policies for basic
    agricultural commodities or storable nonbasic commodities, the
    Corporation should consider the establishment of such policies
    with respect to prices, terms, and conditions as the
    Corporation determines will not discourage or deter
    manufacturers, processors, and dealers from acquiring and
    carrying normal inventories of the commodity of the current
    crop.
      [(c) Sales Price Restrictions.--
              [(1) In general.--Except as otherwise provided in
            this section, the Corporation shall not sell any basic
            agricultural commodity or storable nonbasic commodity
            at less than 115 percent of the lower of--
                      [(A) the current national average price
                    support loan rate for the commodity adjusted
                    for the current market differentials reflecting
                    grade, quality, location, reasonable carrying
                    charges, and other factors determined
                    appropriate by the Corporation; or
                      [(B) the loan repayment level.
              [(2) Extra long staple cotton.--The Corporation may
            sell extra long staple cotton for unrestricted use at
            such price as the Corporation determines is appropriate
            to maintain and expand export and domestic markets.
              [(3) Oilseeds.--The Corporation shall not sell
            oilseeds at less than the lower of--
                      [(A) 105 percent of the current national
                    average price support loan rate for the
                    oilseed, adjusted for the current market
                    differentials reflecting grade, quality,
                    location, reasonable carrying charges, and
                    other factors determined appropriate by the
                    Corporation; or
                      [(B) 115 percent of the loan repayment level.
              [(4) Wheat and feed grains.--Whenever the producer
            reserve program for wheat and feed grains established
            under section 110 is in effect, the Corporation may not
            sell any of its stocks of wheat or feed grains at a
            level that is less than 150 percent of the then current
            loan rate for wheat or feed grains.
              [(5) Upland cotton.--The Commodity Credit Corporation
            shall sell upland cotton for unrestricted use at the
            same price the Corporation sells upland cotton for
            export, but in no event at less than the amount
            provided for in paragraph (1).
      [(d) Nonapplication of Sales Price Restrictions.--The
    foregoing restrictions of this section shall not apply to--
              [(1) sales for new or byproduct uses;
              [(2) sales of peanuts and oilseeds for the extraction
            of oil;
              [(3) sales for seed or feed if the sales will not
            substantially impair any price support program;
              [(4) sales of commodities that have substantially
            deteriorated in quality or as to which there is a
            danger of loss or waste through deterioration or
            spoilage;
              [(5) sales for the purpose of establishing claims
            arising out of contract or against persons who have
            committed fraud, misrepresentation, or other wrongful
            acts with respect to the commodity;
              [(6) sales for export (excluding sales of upland
            cotton for export);
              [(7) sales of wool; and
              [(8) sales for other than primary uses.
      [(e) Distress, Disaster, and Livestock Emergency Areas.--
              [(1) In general.--Notwithstanding the foregoing
            provisions of this section, the Corporation, on such
            terms and conditions as the Secretary may consider in
            the public interest, may--
                      [(A) make available any farm commodity or
                    product thereof owned or controlled by the
                    Corporation for use in relieving distress--
                              [(i) in any area in the United States
                            (including the Virgin Islands) declared
                            by the President to be an acute
                            distress area because of unemployment
                            or other economic cause, if the
                            President finds that the use will not
                            displace or interfere with normal
                            marketing of agricultural commodities;
                            and
                              [(ii) in connection with any major
                            disaster determined by the President to
                            warrant assistance by the Federal
                            Government under the Disaster Relief
                            and Emergency Assistance Act (42 U.S.C.
                            5121 et seq.); and
                      [(B) donate or sell commodities in accordance
                    with title VI.
              [(2) Costs.--Except on a reimbursable basis, the
            Corporation shall not bear any costs in connection with
            making the commodity available under this subsection
            beyond the cost of the commodities to the Corporation
            in--
                      [(A) the storage of the commodity; and
                      [(B) the handling and transportation costs in
                    making delivery of the commodity to designated
                    agencies at one or more central locations in
                    each State or other area.
      [(f) Efficient Operations.--
              [(1) In general.--Subject to paragraph (2), the
            foregoing restrictions of this section shall not apply
            to sales of commodities the disposition of which is
            desirable in the interest of the effective and
            efficient conduct of the operations of the Corporation
            because of the small quantities involved, or because of
            age, location or questionable continued storability of
            the commodity.
              [(2) Offsets.--The sales shall be offset (if
            necessary) by the purchases of commodities as the
            Corporation determines is appropriate to prevent the
            sales from substantially impairing any price support
            program or unduly affecting market prices, except that
            the purchase price shall not exceed the Corporation's
            minimum sales price for the commodities for
            unrestricted use.
              [(3) Competitive bid basis.--Subject to the sales
            price restrictions contained in this section, the
            Corporation may sell any basic agricultural commodity
            or storable nonbasic commodity on a competitive bid
            basis, if the sale is determined to be appropriate by
            the Secretary.
      [(g) Sales for Export.--For the purposes of this section,
    sales for export shall include--
              [(1) sales made on condition that the identical
            commodities sold be exported; and
              [(2) sales made on condition that commodities of the
            same kind and of comparable value or quantity be
            exported, either in raw or processed form.

    [SEC. 407A. QUALITY REQUIREMENTS FOR COMMODITY CREDIT CORPORATION OWNED
                        GRAIN.

      [(a) Establishment of Minimum Standards.--Notwithstanding any
    other provision of law, the Secretary shall establish minimum
    quality standards that shall apply to grain that is deposited
    for storage for the account of the Commodity Credit
    Corporation. In establishing such standards, the Secretary
    shall take into consideration factors related to the ability of
    grain to withstand storage and assurance of acceptable end-use
    performance.
      [(b) Inspection of Grain Acquisitions.--The Commodity Credit
    Corporation shall utilize Federal Grain Inspection Service
    approved procedures to inspect and evaluate the condition of
    the grain it acquires from producers. In no case shall this
    section require the use of an official inspection unless the
    producer so requests.
      [Sec. 408. For the purposes of this Act--
      [(a) A commodity shall be considered storable upon
    determination by the Secretary that, in normal trade practice,
    it is stored for substantial periods of time and that it can be
    stored under the price-support program without excessive loss
    through deterioration or spoilage or without excessive cost for
    storage for such periods as will permit its disposition without
    substantial impairment of the effectiveness of the price-
    support program.
      [(b) A ``cooperator'' with respect to any basic agricultural
    commodity shall be a producer on whose farm the acreage planted
    to the commodity does not exceed the farm acreage allotment for
    the commodity under title III of the Agricultural Adjustment
    Act of 1938, as amended, or in the case of price support for
    corn or wheat to a producer outside the commercial corn-
    producing or wheat-producing area, a producer who complies with
    conditions of eligibility prescribed by the Secretary:
    Provided, That for upland cotton a cooperator shall be a
    producer on whose farm the acreage planted to such cotton does
    not exceed the cooperator percentage, which shall be in the
    case of the 1966 crop, 87.5 per centum of such farm acreage
    allotment and, in the case of each of the 1967 through 1970
    crops, such percentage, not less than 87.5 or more than 100 per
    centum, of such farm acreage allotment as the Secretary may
    specify for such crop, except that in the case of small farms
    (i.e. farms on which the acreage allotment is 10 acres or less,
    or on which the projected farm yield times the acreage
    allotment is 3,600 pounds or less, and the acreage allotment
    has not been reduced under section 344(m)) the acreage of
    cotton on the farm shall not be required to be reduced below
    the farm acreage allotment: And provided, That for the 1971
    through 1977 crops of upland cotton a cooperator shall be a
    producer on a farm on which a farm base acreage allotment has
    been established who has set aside the acreage required under
    section 103(e): Provided further, That for the 1976 through
    1981 crops of rice, a cooperator shall be a person who produces
    rice on a farm for which a farm acreage allotment has been
    established or to which a producer acreage allotment has been
    allocated and, if a set-aside is in effect, who has set aside
    any acreage required under section 101(g): Provided further,
    That for the 1978 through 1981 crops of upland cotton, a
    cooperator shall be a producer on a farm who has set aside the
    acreage required under section 103(f). For the purpose of this
    subsection, a producer shall not be deemed to have exceeded his
    farm acreage allotment unless such producer knowingly exceeded
    such allotment.
      [(c) A ``basic agricultural commodity'' shall mean corn,
    cotton, peanuts, rice, tobacco, and wheat, respectively.
      [(d) A ``nonbasic agricultural commodity'' shall mean any
    agricultural commodity other than a basic agricultural
    commodity.
      [(e) The ``supply percentage'' as to any commodity shall be
    the percentage which the estimated total supply is of the
    normal supply as determined by the Secretary from the latest
    available statistics of the Department of Agriculture as of the
    beginning of the marketing year for the commodity.
      [(f) ``Total supply'' of any nonbasic agricultural commodity
    for any marketing year shall be the carry-over at the beginning
    of such marketing year, plus the estimated production of the
    commodity in the United States during the calendar year in
    which such marketing year begins and the estimated imports of
    the commodity into the United States during such marketing
    year.
      [(g) ``Carry-over'' of any nonbasic agricultural commodity
    for any marketing year shall be the quantity of the commodity
    on hand in the United States at the beginning of such marketing
    year, not including any part of the crop or production of such
    commodity which was produced in the United States during the
    calendar year then current. The carry-over of any such
    commodity may also include the quantity of such commodity in
    processed form on hand in the United States at the beginning of
    such marketing year, if the Secretary determines that the
    inclusion of such processed quantity of the commodity is
    necessary to effectuate the purposes of this Act.
      [(h) ``Normal supply'' of any nonbasic agricultural commodity
    for any marketing year shall be (1) the estimated domestic
    consumption of the commodity for the marketing year for which
    such normal supply is being determined, plus (2) the estimated
    exports of the commodity for such marketing year, plus (3) an
    allowance for carry-over. The allowance for carry-over shall be
    the average carry-over of the commodity for the five marketing
    years immediately preceding the marketing year in which such
    normal supply is determined, adjusted for surpluses or
    deficiencies caused by abnormal conditions, changes in
    marketing conditions, or the operation of any agricultural
    program. In determining normal supply, the Secretary shall make
    such adjustments for current trends in consumption and for
    unusual conditions as he may deem necessary.
      [(i) ``Marketing year'' for any nonbasic agricultural
    commodity means any period determined by the Secretary during
    which substantially all of a crop or production of such
    commodity is normally marketed by the producers thereof.
      [(j) Any term defined in the Agricultural Adjustment Act of
    1938, shall have the same meaning when used in this Act.
      [(k)(1) Reference made in sections 402, 403, 406, 407, and
    416 to the terms ``support price'', ``level of support'', and
    ``level of price support'' shall be considered to apply as well
    to the loan and purchase level for wheat, feed grains, upland
    cotton, extra long staple cotton, honey, oilseeds and rice
    under this Act.
      [(2) References made to the terms ``price support'', ``price
    support operations'', and ``price support program'' in such
    sections and in section 401(a) shall be considered as applying
    as well to loan and purchase operations for wheat, feed grains,
    upland cotton, extra long staple cotton, honey, oilseeds and
    rice under this Act.
      [(3) Notwithstanding any other provision of law, this
    subsection shall be effective only for the 1991 through 1995
    crops of wheat, feed grains, upland cotton, extra long staple
    cotton, honey, oilseeds and rice.
      [(l) ``Producer'' shall include a person growing hybrid seed
    under contract. In determining the interest of a grower of
    hybrid seed in a crop, the Secretary shall not take into
    consideration the existence of a hybrid seed contract.
      [Sec. 412. Determinations made by the Secretary under this
    Act shall be final and conclusive: Provided, That the scope and
    nature of such determinations shall not be inconsistent with
    the provisions of the Commodity Credit Corporation Charter Act.
      [Sec. 413. This Act shall not be effective with respect to
    price support operations for any agricultural commodity for any
    marketing year or season commencing prior to January 1, 1950,
    except to the extent that the Secretary of Agriculture shall,
    without reducing price support theretofore undertaken or
    announced, elect to apply the provisions of this Act.
      [Sec. 415. (a) Except as modified by this Act or by Public
    Law 272, Eighty-first Congress, sections 201(b), 201(d),
    201(e), 203, 207(a), and 208 of the Agricultural Act of 1948
    shall be effective for the purpose of taking any action with
    respect to the 1950 and subsequent crops upon the enactment of
    this Act. If the time within which any such action is required
    to be taken shall have elapsed prior to the enactment of this
    Act, such action shall be taken within thirty days after the
    enactment of this Act.
      [(b) No provision of the Agricultural Act of 1948 shall be
    deemed to supersede any provision of Public Law 272, Eighty-
    first Congress.
      [Sec. 416. (a) In order to prevent the waste of commodities
    whether in private stocks or acquired through price-support
    operations by the Commodity Credit Corporation before they can
    be disposed of in normal domestic channels without impairment
    of the price-support program or sold abroad at competitive
    world prices, the Commodity Credit Corporation is authorized,
    on such terms and under such regulations as the Secretary may
    deem in the public interest: (1) upon application, to make such
    commodities available to any Federal agency for use in making
    payment for commodities not produced in the United States; (2)
    to barter or exchange such commodities for strategic or other
    materials as authorized by law; (3) in the case of food
    commodities to donate such commodities to the Bureau of Indian
    Affairs and to such State, Federal, or private agency or
    agencies as may be designated by the proper State or Federal
    authority and approved by the Secretary, for use in the United
    States in nonprofit school-lunch programs, in nonprofit summer
    camps for children, in the assistance of needy persons, and in
    charitable institutions, including hospitals and facilities, to
    the extent that they serve needy persons (including infants and
    children). In the case of (3) the Secretary shall obtain such
    assurance as he deems necessary that the recipients thereof
    will not diminish their normal expenditures for food by reason
    of such donation. In order to facilitate the appropriate
    disposal of such commodities, the Secretary may from time to
    time estimate and announce the quantity of such commodities
    which he anticipates will become available for distribution
    under (3). The Commodity Credit Corporation may pay, with
    respect to commodities disposed of under this subsection,
    reprocessing, packaging, transporting, handling, and other
    charges accruing up to the time of their delivery to a Federal
    agency or to the designated State or private agency. In
    addition, in the case of food commodities disposed of under
    this subsection, the Commodity Credit Corporation may pay the
    cost of processing such commodities into a form suitable for
    home or institutional use, such processing to be accomplished
    through private trade facilities to the greatest extent
    possible. For the purpose of this subsection the terms
    ``State'' and ``United States'' include the District of
    Columbia and any Territory or possession of the United States.
      [Dairy products acquired by the Commodity Credit Corporation
    through price support operations may, insofar as they can be
    used in the United States in nonprofit school lunch and other
    nonprofit child feeding programs, in the assistance of needy
    persons, and in charitable institutions, including hospitals,
    to the extent that needy persons are served, be donated for any
    such use prior to any other use or disposition. Notwithstanding
    any other provision of law, such dairy products may be donated
    for distribution to needy households in the United States and
    to meet the needs of persons receiving nutrition assistance
    under the Older Americans Act of 1965.
      [(b)(1) The Secretary, subject to the requirements of
    paragraph (10), may furnish eligible commodities for carrying
    out programs of assistance in developing countries and friendly
    countries under titles II and III of the Agricultural Trade
    Development and Assistance Act of 1954 and under the Food for
    Progress Act of 1985, as approved by the Secretary, and for
    such purposes as are approved by the Secretary. To ensure that
    the furnishing of commodities under this subsection is
    coordinated with and complements other United States foreign
    assistance, assistance under this subsection shall be
    coordinated through the mechanism designated by the President
    to coordinate assistance under the Agricultural Trade
    Development and Assistance Act of 1954.
      [(2) As used in this subsection, the term ``eligible
    commodities'' means--
              [(A) dairy products, wheat, rice, feed grains, and
            oilseeds acquired by the Commodity Credit Corporation
            through price support operations, and the products
            thereof, that the Secretary determines meet the
            criteria specified in subsection (a); and
              [(B) such other edible agricultural commodities as
            may be acquired by the Secretary or the Commodity
            Credit Corporation in the normal course of operations
            and that are available for disposition under this
            subsection, except that no such commodities may be
            acquired for the purpose of their use under this
            subsection.
      [(3)(A) Commodities may not be made available for disposition
    under this subsection in amounts that (i) will, in any way,
    reduce the amounts of commodities that traditionally are made
    available through donations to domestic feeding programs or
    agencies, or (ii) will prevent the Secretary from fulfilling
    any agreement entered into by the Secretary under a payment-in-
    kind program under this Act or other Acts administered by the
    Secretary.
      [(B)(i) The requirements of section 403(a) of the
    Agricultural Trade Development and Assistance Act of 1954 shall
    apply with respect to commodities furnished under this
    subsection. Commodities may not be furnished for disposition to
    any country under this subsection except on determinations by
    the Secretary that--
              [(I) the receiving country has the absorptive
            capacity to use the commodities efficiently and
            effectively; and
              [(II) such disposition of the commodities will not
            interfere with usual marketings of the United States,
            nor disrupt world prices of agricultural commodities
            and normal patterns of commercial trade with developing
            countries.
      [(ii) The requirement for safeguarding usual marketings of
    the United States shall not be used to prevent the furnishing
    under this subsection of any eligible commodity for use in
    countries that--
              [(I) have not traditionally purchased the commodity
            from the United States; or
              [(II) do not have adequate financial resources to
            acquire the commodity from the United States through
            commercial sources or through concessional sales
            arrangements.
      [(C) The Secretary shall take reasonable precautions to
    ensure that--
              [(i) commodities furnished under this subsection will
            not displace or interfere with sales that otherwise
            might be made; and
              [(ii) sales or barter under paragraph (7) will not
            unduly disrupt world prices of agricultural commodities
            nor normal patterns of commercial trade with friendly
            countries.
      [(D) If eligible commodities are made available under this
    subsection to a friendly country, nonprofit and voluntary
    agencies and cooperatives shall also be eligible to receive
    commodities for food aid programs in the country.
      [(4) Agreements may be entered into under this subsection to
    provide eligible commodities in installments over an extended
    period of time. In agreements with recipients of eligible
    commodities under this subsection (including nonprofit and
    voluntary agencies or cooperatives), subject to the
    availability of commodities each fiscal year, the Secretary, on
    request, shall approve multiyear agreements to make
    agricultural commodities available for distribution or sale by
    the recipients if the agreements otherwise meet the
    requirements of this subsection.
      [(5)(A) Section 406 of the Agricultural Trade Development and
    Assistance Act of 1954 shall apply to the commodities furnished
    under this subsection.
      [(B) The Commodity Credit Corporation may pay the processing
    and domestic handling costs incurred, as authorized under this
    subsection, in the form of eligible commodities, as defined in
    paragraph (2)(A), if the Secretary determines that such in-kind
    payment will not disrupt domestic markets.
      [(6) The cost of commodities furnished under this subsection,
    and expenses incurred under section 406 of the Agricultural
    Trade Development and Assistance Act of 1954 in connection with
    those commodities, shall be in addition to the level of
    assistance programmed under that Act and shall not be
    considered expenditures for international affairs and finance.
      [(7) Eligible commodities furnished under this subsection may
    be sold or bartered only with the approval of the Secretary and
    solely as follows:
              [(A) Sales and barter that are incidental to the
            donation of the commodities or products.
              [(B) Sales and barter to finance the distribution,
            handling, and processing costs of the donated
            commodities or products in the importing country or in
            a country through which such commodities or products
            must be transshipped, or other activities in the
            importing country that are consistent with providing
            food assistance to needy people.
              [(C) Sales and barter of commodities and products
            furnished to intergovernmental agencies or
            organizations, insofar as they are consistent with
            normal programming procedures in the distribution of
            commodities by those agencies or organizations.
              [(D)(i) Sales of commodities and products furnished
            to nonprofit and voluntary agencies, or cooperatives,
            for food assistance under agreements that provide for
            the use, by the agency or cooperative, of foreign
            currency proceeds generated from such sale of
            commodities or products for the purposes established in
            clause (ii) of this subparagraph.
              [(ii) Foreign currencies generated from partial or
            full sales or barter of commodities by a nonprofit and
            voluntary agency or cooperative shall be used--
                      [(I) to transport, store, distribute, and
                    otherwise enhance the effectiveness of the use
                    of commodities and the products thereof donated
                    under this section; and
                      [(II) to implement income generating,
                    community development, health, nutrition,
                    cooperative development, agricultural
                    programs,  and  other  developmental
                    activities.
            In addition, foreign currency proceeds generated in
            Poland may also be used by governmental and
            nongovernmental agencies or cooperatives for eligible
            activities approved by the joint commission established
            pursuant to section 2226 of the American Aid to Poland
            Act of 1988 and by the United States chief of
            diplomatic mission in Poland that would improve the
            quality of life of the Polish people and would
            strengthen and support the activities of governmental
            or private, nongovernmental independent institutions in
            Poland. Activities eligible under the preceding
            sentence include--
              [(I) any project undertaken in Poland under the
            auspices of the Charitable Commission of the Polish
            Catholic Episcopate for the benefit of handicapped or
            orphaned children;
              [(II) any project for the reconstruction, renovation,
            or maintenance of the Research Center on Jewish History
            and Culture of the Jagiellonian University of Krakow,
            Poland, established for the study of events related to
            the Holocaust in Poland;
              [(III) any other project or activity which
            strengthens and supports private and independent
            sectors of the Polish economy, especially independent
            farming and agriculture; and
              [(IV) the Polish Catholic Episcopate's Rural Water
            Supply Foundation.
              [(iii) Except as otherwise provided in clause (v),
            such agreements, taken together for each fiscal year,
            shall provide for sales of commodities and products for
            foreign currency proceeds in amounts that are, in the
            aggregate, not less than 10 percent of the aggregate
            value of all commodities and products furnished, or the
            minimum tonnage required, whichever is greater, for
            carrying out programs of assistance under this
            subsection in such fiscal year. The minimum allocation
            requirements of this clause apply with respect to
            commodities and products made available under this
            subsection for carrying out programs of assistance
            under titles II and III of the Agricultural Trade
            Development and Assistance Act of 1954, and not with
            respect to commodities and products made available to
            carry out the Food for Progress Act of 1985.
              [(iv) Foreign currency proceeds generated from the
            sale of commodities or products under this subparagraph
            shall be expended within the country of origin within
            one year of acquisition of such currency, except that
            the Secretary may permit the use of such proceeds (I)
            in countries other than the country of origin as
            necessary to expedite the transportation of commodities
            and products furnished under this subsection, (II)
            after one year of acquisition as appropriate to achieve
            the purposes of clause (i), and (III) in a country
            other than the country of origin, if such proceeds are
            generated in a currency generally accepted in such
            other country.
              [(v) The provisions of clause (iii) of this
            subparagraph establishing minimum annual allocations
            for sales and use of proceeds shall not apply to the
            extent that there have not been sufficient requests for
            such sales and use of proceeds nor to the extent
            required under paragraph (3).
              [(E) Sales and barter to cover expenses incurred
            under paragraph (5)(a).
      [(F) The provisions of sections 403(i) and 407(c) of the
    Agricultural Trade Development and Assistance Act of 1954 shall
    apply to donations, sales and barters of eligible commodities
    under this subsection.
    No portion of the proceeds or services realized from sales or
    barter under this paragraph may be used to meet operating and
    overhead expenses, except as otherwise provided in subparagraph
    (C) and except for personnel and administrative costs incurred
    by local cooperatives.
      [(8)(A) To the maximum extent practicable, expedited
    procedures shall be used in the implementation of this
    subsection.
      [(B) The Secretary shall be responsible for regulations
    governing sales and barter, and the use of foreign currency
    proceeds, under paragraph (7) of this subsection that will
    provide reasonable safeguards to prevent the occurrence of
    abuses in the conduct of activities provided for in paragraph
    (7).
      [(C)(i) If a proposal to make eligible commodities available
    under this subsection is submitted by a nonprofit and voluntary
    agency or cooperative with the concurrence of the appropriate
    United States Government field mission or if a proposal to make
    such commodities available to a nonprofit and voluntary agency
    or cooperative is submitted by the United States Government
    field mission, a decision on the proposal shall be provided
    within 45 days after receipt by the Agency for International
    Development office in Washington, D.C. The response shall
    detail the reasons for approval or denial of the proposal. If
    the proposal is denied, the response shall specify the
    conditions that would need to be met for the proposal to be
    approved.
      [(ii) Not later than 30 days before the issuance of a final
    guideline issued to carry out this subsection, the Secretary
    shall--
              [(I) provide notice of the proposed guideline to
            nonprofit and voluntary agencies and cooperatives that
            participate in programs under this subsection, and
            other interested persons, that the proposed guideline
            is available for review and comment;
              [(II) make the proposed guideline available, on
            request, to nonprofit and voluntary agencies,
            cooperatives, and others; and
              [(III) take any comments received into consideration
            before the issuance of the final guideline.
      [(iii) Not later than 15 days after receipt of a call forward
    from a field mission for commodities or products that meets the
    requirements of this subsection, the order for the purchase or
    the supply, from inventory, of such commodities or products
    shall be transmitted to the Commodity Credit Corporation.
      [(9)(A) Each recipient of commodities and products approved
    for sale or barter under paragraph (7) shall report to the
    Secretary information with respect to the items required to be
    included in the Secretary's report pursuant to clauses (i)
    through (iv) of subparagraph (B). Reports pursuant to this
    subparagraph shall be submitted in accordance with regulations
    of the Secretary. Such regulations shall require at least one
    report annually, to be submitted not later than December 31
    following the end of the fiscal year in which the commodities
    and products are received; except that a report shall not be
    required with respect to fiscal year 1985.
      [(B) Not later than February 15, 1987, and annually
    thereafter, the Secretary shall report to the Congress on sales
    and barter, and use of foreign currency proceeds, under
    paragraph (7) during the preceding fiscal year. Such report
    shall include information on--
              [(i) the quantity of commodities furnished for such
            sale or barter;
              [(ii) the amount of funds (including dollar
            equivalents for foreign currencies) and value of
            services generated from such sales and barter in such
            fiscal year;
              [(iii) how such funds and services were used;
              [(iv) the amount of foreign currency proceeds that
            were used under agreements under subparagraph (D) of
            paragraph (7) in such fiscal year, and the percentage
            of the quantity of all commodities and products
            furnished under this subsection in such fiscal year
            such use represented;
              [(v) the Secretary's best estimate of the amount of
            foreign currency proceeds that will be used, under
            agreements under subparagraph (D) of paragraph (7), in
            the then current fiscal year and the next following
            fiscal year (if all requests for such use are agreed
            to), and the percentage that such estimated use
            represents of the quantity of all commodities and
            products that the Secretary estimates will be furnished
            under this subsection in each such fiscal year;
              [(vi) the effectiveness of such sales, barter, and
            use during such fiscal year in facilitating the
            distribution of commodities and products under this
            subsection;
              [(vii) the extent to which sales, barter, or uses--
                      [(I) displace or interfere with commercial
                    sales of United States agricultural commodities
                    and products that otherwise would be made,
                      [(II) affect usual marketings of the United
                    States,
                      [(III) disrupt world prices of agricultural
                    commodities or normal patterns of trade with
                    friendly countries, or
                      [(IV) discourage local production and
                    marketing of agricultural commodities in the
                    countries in which commodities and products are
                    distributed under this subsection; and
              [(viii) the Secretary's recommendations, if any, for
            changes to improve the conduct of sales, barter, or use
            activities under paragraph (7).
      [(10)(A) Subject to the limitations established under
    paragraph (3), the Secretary shall make available for
    disposition under this subsection in each of the fiscal years
    1988 through 1990 not less than the minimum quantities of
    eligible commodities specified in subparagraph (B).
      [(B) The minimum quantity of eligible commodities that shall
    be made available for disposition under this subsection in each
    fiscal year shall be--
              [(i) 500,000 metric tons of wheat, rice, feed grains,
            and oilseeds from the Corporation's uncommitted stocks,
            or an amount equal to 10 percent of the Corporation's
            uncommitted stocks of wheat, rice, feed grains, and
            oilseeds as of the end of such fiscal year (as
            estimated by the Secretary), whichever is less; and
              [(ii) 10 percent of the Corporation's uncommitted
            stocks of dairy products, but not less than 150,000
            metric tons of such products to the extent that
            uncommitted stocks are available.
    The Secretary shall make such estimation of expected year-end
    levels of the Corporation's uncommitted stocks prior to the
    beginning of the fiscal year or, in the case of fiscal year
    1986, prior to March 31, 1986. The Secretary's determination as
    to the amount of the Corporation's stocks that shall be made
    available for disposition under this subsection for such fiscal
    year shall be published in the Federal Register, along with a
    breakdown by kind of commodity and the quantity of each kind of
    commodity that shall be made available, before the beginning of
    such fiscal year or, in the case of fiscal year 1986, March 31,
    1986.
      [(C) Of the aggregate amounts made available each fiscal year
    pursuant to both clauses (i) and (ii) of subparagraph (B), not
    less than 75,000 metric tons shall be made available to carry
    out the Food for Progress Act of 1985.
      [(D)(i) The Secretary--
              [(I) may waive the minimum quantity requirements of
            subparagraphs (A) and (B) for a fiscal year to the
            extent that the Secretary determines and reports to
            Congress that there are not sufficient requests for
            eligible commodities under this subsection for such
            fiscal year, except that the waiver authority of this
            subclause may not be used to waive the minimum quantity
            requirement of subparagraph (C);
              [(II) may waive the minimum quantity requirement of
            subparagraph (C) in accordance with subsection (f)(2)
            of the Food for Progress Act of 1985; and
              [(III) may waive the minimum quantity requirements of
            subparagraphs (A), (B), and (C) for a fiscal year, if
            the Secretary determines that the restrictions on the
            furnishing of commodities under paragraph (3) prevent
            the making available of commodities in such quantities.
      [(ii) For any fiscal year in which the minimum levels of
    uncommitted Commodity Credit Corporation stocks specified in
    subparagraph (B) are not made available and during which any
    requests for commodities under this subsection are rejected,
    the Secretary shall provide a detailed, written explanation to
    Congress, at the end of such fiscal year, of the reasons for
    the rejections of such requests.
      [(11)(A) The Secretary may furnish eligible commodities under
    this subsection in connection with (i) concessional sales
    agreements entered into under title I of the Agricultural Trade
    Development and Assistance Act of 1954 or other statutes, or
    (ii) agricultural export bonus or promotion programs carried
    out under the Commodity Credit Corporation Charter Act or other
    statutes.
      [(B) Eligible commodities may be furnished by the Secretary
    under this subsection in connection with agreements by
    recipient countries to acquire additional agricultural
    commodities from the United States through commercial
    arrangements.
      [(C) The amount of any commodity furnished under
    subparagraphs (A) and (B) of this paragraph in any fiscal year
    shall not be considered for the purpose of determining whether
    the requirements of paragraph (10)(A) of this subsection have
    been met during such fiscal year.
      [(12) There is authorized to be appropriated for fiscal year
    1988, in addition to any other funds authorized to be
    appropriated, $1,000,000 for technical assistance for the sale
    or barter of commodities under paragraph (7) to strengthen
    nonprofit private organizations and cooperatives in the
    Philippines.
      [(c) To prevent the waste of dairy products acquired by the
    Commodity Credit Corporation through price support operations,
    the Corporation, on such terms and under such regulations as
    the Secretary may prescribe, shall carry out a two-year pilot
    program under which the Corporation shall barter or exchange
    such dairy products, to the extent they are available, for
    forty thousand metric tons (consisting of twenty thousand
    metric tons in each year of the pilot program) of ultra-high
    temperature processed fluid milk. Such barter or exchange shall
    be effected on the basis of competitive bids submitted by
    domestic processors. The processed milk acquired by the
    Corporation under this subsection shall be available for
    donation through foreign governments and public and nonprofit
    private humanitarian organizations for the assistance of needy
    persons outside the United States, and the Corporation may pay,
    with respect to such processed milk donated under this
    subsection, transporting, handling, and other charges,
    including the cost of overseas delivery. Any donations under
    this subsection shall be coordinated through the mechanism
    designated by the President to coordinate assistance under the
    Agricultural Trade Development and Assistance Act of 1954 and
    shall be in addition to the level of assistance programmed
    under that Act. The pilot program shall be implemented by the
    Corporation as soon as practicable after the enactment of the
    Agricultural Programs Adjustment Act of 1984 and shall be
    operated for a period of two years after its implementation.
    Upon completion of the pilot program, the Secretary shall
    submit a report to Congress on its operation.
      [Sec. 420. Any price support program in effect on cottonseed
    or any of its products shall be extended to the same seed and
    products of the cottons defined under section 347(a) of the
    Agricultural Adjustment Act of 1938, as amended.

                           [FORGIVENESS OF VIOLATIONS

      [Sec. 422. Notwithstanding any other provision of law,
    whenever a producer samples, turns, moves, or replaces grain or
    any other commodity which is security for a Commodity Credit
    Corporation producer loan or is held under a producer reserve
    program, and does so in violation of law or regulation, the
    appropriate county committee established under section 8(b) of
    the Soil Conservation and Domestic Allotment Act may forgive
    some or all of the penalties and requirements that would
    normally be imposed on the producer by reason of the violation,
    if such committee determines that (1) the violation occurred
    inadvertently or accidentally, because of lack of knowledge or
    understanding of the law or regulation, or because the producer
    or the producer's agent acted to prevent spoilage of the
    commodity, and (2) the violation did not result in harm or
    damage to the rights or interests of any person. The county
    committee shall furnish a copy of its determination to the
    Administrator of the Agricultural Stabilization and
    Conservation Service and the appropriate State committee
    established under section 8(b) of the Soil Conservation and
    Domestic Allotment Act. The determination may be disapproved by
    either the Administrator or the State committee within sixty
    days after receipt of a copy of the determination. Any
    determination not disapproved by the Administrator or such
    State committee within such sixty-day period shall be
    considered approved.
      [Sec. 423. (a) Notwithstanding any other provision of law, in
    order to prevent the accumulation of excessive stocks of
    agricultural commodities through the price support and
    stabilization operations of the Commodity Credit Corporation
    the Corporation may, under terms and conditions established by
    the Secretary, make its accumulated stocks of agricultural
    commodities available, at no cost or reduced cost, to encourage
    the purchase of such commodities for the production of liquid
    fuels and agricultural commodity byproducts. In carrying out
    the program established by this section, the Secretary shall
    ensure, insofar as possible, that any use of agricultural
    commodities made available be made in such manner as to
    encourage increased use and avoid displacing usual marketings
    of agricultural commodities.
      [(b) In determining the feasibility of providing for the
    processing of Commodity Credit Corporation stocks of
    commodities under subsection (a), the Secretary shall consider
    the nature of the commodities, and the acquisition,
    transportation, handling, storage, interest, and other costs
    associated with acquiring and maintaining such stocks,
    including the effect of such stocks in depressing commodity
    prices, as well as the value and utility of such stocks when
    processed into liquid fuels and agricultural commodity
    byproducts.
      [(c) Not later than one hundred and twenty days after the
    date of enactment of this section, and annually thereafter, the
    Secretary shall report to the Congress with respect to the
    operation of this section, including any recommendations for
    legislative changes the Secretary finds necessary with respect
    to the authority provided in this section.

    [SEC. 427. CROP INSURANCE REQUIREMENT.

      [As a condition of receiving any benefit (including payments)
    under title I or II for each of the 1995 and subsequent crops
    of tobacco, rice, extra long staple cotton, upland cotton, feed
    grains, wheat, peanuts, oilseeds, and sugar, a producer must
    obtain at least catastrophic risk protection insurance coverage
    under section 508 of the Federal Crop Insurance Act (7 U.S.C.
    1508) for the crop and crop year for which the benefit is
    sought, if the coverage is offered by the Corporation.

                    [TITLE V--ACREAGE BASE AND YIELD SYSTEM

    [SEC. 501. PURPOSE.

      [The purpose of this title is to prescribe a system for
    establishing crop acreage bases and program payment yields for
    the wheat, feed grains, upland cotton, and rice programs under
    this Act that is efficient, equitable, flexible, and
    predictable.

    [SEC. 502. DEFINITIONS.

      [For purposes of this title:
              [(1) County committee.--The term ``county committee''
            means the county committee established under section
            8(b) of the Soil Conservation and Domestic Allotment
            Act (16 U.S.C. 590h(b)) for the county in which the
            farm is administratively located.
              [(2) Oilseed.--The term ``oilseed'' means a crop of
            soybeans, sunflower seed, rapeseed, canola, safflower,
            flaxseed, mustard seed, or, if designated by the
            Secretary, other oilseeds.
              [(3) Program crop.--The term ``program crop'' means a
            crop of wheat, corn, grain sorghums, oats, barley,
            upland cotton, or rice.

    [SEC. 503. CROP ACREAGE BASES.

      [(a) Establishment.--
              [(1) In general.--The Secretary shall provide for the
            establishment and maintenance of crop acreage bases for
            each program crop, including any program crop produced
            under an established practice of double cropping.
              [(2) Limitation.--The sum of the crop acreage bases
            on the farm may not exceed the cropland on the farm,
            except to the extent there is an established practice
            of double cropping on the farm.
              [(3) Definition of double cropping.--As used in this
            subsection, the term ``double cropping'' means a
            farming practice, as defined by the Secretary, that has
            been carried out on a farm during at least 3 of the 5
            crop years immediately preceding the crop year for
            which the crop acreage base for the farm is
            established.
      [(b) Calculation.--
              [(1) In general.--Except as provided in paragraph
            (2), the crop acreage base for each program crop for a
            farm for a crop year shall be the number of acres that
            is equal to the average of the acreage planted and
            considered planted to the program crop for harvest on
            the farm in each of the 5 crop years preceding the crop
            year.
              [(2) Cotton and rice.--
                      [(A) In general.--In the case of upland
                    cotton and rice, except as provided in
                    subparagraph (B), the crop acreage base for
                    such crop shall be equal to the average of the
                    acreage planted and considered planted to such
                    crop for harvest on the farm in each of the 3
                    crop years preceding such crop year.
                      [(B) Exception.--
                              [(i) 1991 crops.--In the case of each
                            of the 1991 crops of upland cotton and
                            rice, if the producers on a farm did
                            not participate in the production
                            adjustment program established for the
                            1989 and 1990 crops of upland cotton
                            and rice, respectively, the crop
                            acreage base for the 1991 crop shall be
                            equal to the average of the acreage
                            planted and considered planted to such
                            crop for harvest on the farm in each of
                            the 5 crop years preceding the 1991
                            crop year, excluding all crop years in
                            which planted and considered planted
                            acreage was not established for the
                            farm. Any crop acreage base established
                            in accordance with this subparagraph
                            shall not exceed a number of acres
                            equal to the average of the acreage
                            planted and considered planted to such
                            crop for harvest on the farm in each of
                            the 2 crop years preceding the 1991
                            crop year.
                              [(ii) 1992 crops.--In the case of
                            each of the 1992 crops of upland cotton
                            and rice, if the producers on a farm
                            did not participate in the production
                            adjustment program established for the
                            1990 and 1991 crops of upland cotton
                            and rice, respectively, the crop
                            acreage base for the 1992 crop shall be
                            equal to the average of the acreage
                            planted and considered planted to such
                            crop for harvest on the farm in each of
                            the 5 crop years preceding the 1992
                            crop year, excluding all crop years in
                            which planted and considered planted
                            acreage was not established for the
                            farm. Any crop acreage base established
                            in accordance with this subparagraph
                            shall not exceed a number of acres
                            equal to the average of the acreage
                            planted and considered planted to such
                            crop for harvest on the farm in each of
                            the 2 crop years preceding the 1992
                            crop year.
      [(c) Acreage Considered Planted.--For purposes of this Act,
    acreage considered planted to a program crop shall consist of--
              [(1) any reduced acreage and diverted acreage on the
            farm;
              [(2) any acreage on the farm that producers were
            prevented from planting to the crop because of drought,
            flood, or other natural disaster, or other condition
            beyond the control of the producers;
              [(3) acreage in an amount equal to the difference
            between the permitted acreage for a program crop and
            the acreage planted to the crop, if the acreage
            considered to be planted is devoted to conservation
            uses or the production of commodities permitted by the
            Secretary under the programs established for any of the
            1991 through 1997 crops of wheat, feed grains, upland
            cotton, and rice established under sections
            107B(c)(1)(E), 105B(c)(1)(E), 103B(c)(1)(D), and
            101B(c)(1)(D), respectively;
              [(4) acreage in an amount equal to the difference
            between the permitted acreage for a program crop and
            the acreage planted to the crop, if the acreage
            considered to be planted is devoted to the production
            of commodities in accordance with section 504;
              [(5) any acreage on the farm that the Secretary
            determines is necessary to be included in establishing
            a fair and equitable crop acreage base;
              [(6) acreage in an amount not to exceed 20 percent of
            the crop acreage base for a crop of feed grains or
            wheat if--
                      [(A) the acreage is planted to dry peas
                    (limited to Austrian peas, wrinkled, seed,
                    green, yellow, and umatilla) and lentils; and
                      [(B) payments are not received by producers
                    under sections 105B(c)(1)(E) and 107B(c)(1)(E),
                    as the case may be;
              [(7) the crop acreage base for the crop, if producers
            on the farm forgo receiving any payments under the
            program established under title I for the crop and
            certify that no acreage on the farm was planted to--
                      [(A) the crop; or
                      [(B) any fruit or vegetable crop (including
                    potatoes and dry edible beans) not designated
                    as an industrial or experimental crop by the
                    Secretary, in excess of normal plantings; and
              [(8) any acreage on the farm for which the crop
            acreage base for the crop on the farm was adjusted
            because of a condition or occurrence beyond the control
            of the producer pursuant to subsection (h).
      [(d) Construction of Planting History.--For the purpose of
    determining the crop acreage base for the 1991 and subsequent
    crop years for any farm, the county committee, in accordance
    with regulations prescribed by the Secretary, may construct a
    planting history for such crop if--
              [(1) planting records for such crop for any of the 5
            crop years preceding such crop year are incomplete or
            unavailable; or
              [(2) during at least one but not more than 4 of the 5
            crop years preceding such crop year, the program crop
            was not produced on the farm.
      [(e) Crop Rotation and Other Factors.--The Secretary shall
    make adjustments to reflect crop rotation practices and to
    reflect such other factors as the Secretary determines should
    be considered in determining a fair and equitable crop acreage
    base, including adjustments necessary to enable producers to
    meet the requirements of title XII of the Food Security Act of
    1985 (16 U.S.C. 3801 et seq.).
      [(f) Prevented Planting.--If a county committee determines,
    in accordance with regulations prescribed by the Secretary,
    that the occurrence of a natural disaster or other similar
    condition beyond the control of the producer prevented the
    planting of a program crop on any farm within the county (or
    substantially destroyed any such program crop after it had been
    planted but before it had been harvested), the producer may
    plant any other crop, including any other program crop, on the
    acreage of such farm that, but for the occurrence of such
    disaster or other condition, would have been devoted to the
    production of a program crop. For purposes of determining the
    crop acreage base, any acreage on the farm on which a
    substitute crop, including any program crop, is planted under
    this subsection shall be taken into account as if such acreage
    had been planted to the program crop for which the other crop
    was substituted.
      [(g) Subsequent Crop Years.--A producer who is eligible to
    receive a deficiency payment for any program crop or crop of
    extra long staple cotton in any crop year with respect to a
    farm may not use the acreage planted or considered planted to
    any program crop or crop of extra long staple cotton on the
    farm in the crop year to increase any crop acreage base
    established for the farm in a subsequent crop year.
      [(h) Adjustment of Bases.--
              [(1) In general.--The county committee, in accordance
            with regulations prescribed by the Secretary, may
            adjust any crop acreage base for any program crop for
            any farm if the crop acreage base for the crop on the
            farm would otherwise be adversely affected by a
            condition or occurrence beyond the control of the
            producer.
      [(2) Restoration of Crop Acreage Base.--
              [(A) In general.--For the 1992 through 1997 crop
            years, the county committee shall allow an eligible
            producer to increase individual crop acreage bases on
            the farm, subject to subsection (a)(2), above the
            levels of base that would otherwise be established
            under this section, in order to restore the total of
            crop acreage bases on the farm for the 1992 through
            1997 crop years to the same level as the total of crop
            acreage bases on the farm for the 1990 crop year.
              [(B) Eligible producer defined.--For the purposes of
            this paragraph, the term ``eligible producer'' means a
            producer of upland cotton or rice who, the appropriate
            county committee determines--
                      [(i) was required to reduce one or more
                    individual crop acreage bases on the farm
                    during the 1991 crop year in order to comply
                    with subsection (a)(2) and the change in the
                    calculation of cotton and rice crop acreage
                    bases to a 3-year formula as provided in this
                    section; and
                      [(ii) has participated in the price support
                    program during the 1991 crop year and each
                    subsequent crop year through the current crop
                    year.
              [(C) Regulations.--The Secretary shall issue
            regulations to carry out this paragraph.

    [SEC. 504. PLANTING FLEXIBILITY.

      [(a) In General.--The producers on a farm may, in accordance
    with this section, plant for harvest on the crop acreage base
    established for a program crop a commodity, other than the
    specific program crop, without suffering a reduction in the
    crop acreage base as a result of the production.
      [(b) Specified Commodities.--
              [(1) Permitted crops.--Except as provided in
            paragraph (2), for purposes of this section, the
            commodities that may be planted for harvest on a crop
            acreage base are--
                      [(A) any program crop;
                      [(B) any oilseed;
                      [(C) any industrial or experimental crop
                    designated by the Secretary;
                      [(D) any other crop, except any fruit or
                    vegetable crop (including potatoes and dry
                    edible beans) not designated by the Secretary
                    as--
                              [(i) an industrial or experimental
                            crop; or
                              [(ii) a crop for which no substantial
                            domestic production or market exists;
                            and
                      [(E) mung beans.
              [(2) Limitation.--For purposes of this section, the
            Secretary may, at the discretion of the Secretary,
            prohibit the planting on a crop acreage base of any
            crop specified in paragraph (1).
              [(3) Notification.--With regard to commodities that
            may be planted pursuant to this subsection, the
            Secretary shall make a determination in each crop year
            of the commodities that may not be planted pursuant to
            this subsection and shall make available a list of the
            commodities.
      [(c) Limitation on Acreage.--
              [(1) In general.--Except as provided in paragraph
            (2), the quantity of the crop acreage base that may be
            planted to a commodity, other than the specific program
            crop, under this section may not exceed 25 percent of
            the crop acreage base.
              [(2) Exception for soybeans.--If on January 1 of any
            calendar year the Secretary estimates that the national
            average price of soybeans during the following
            marketing year for soybeans would be less than 105
            percent of the nonrecourse loan level for soybeans
            established in section 205 if soybeans were allowed to
            be planted on up to 25 percent of the crop acreage base
            under this section, the quantity of the crop acreage
            base that may be planted to soybeans under this section
            may not exceed 15 percent of the crop acreage base.
      [(d) Plantings in Excess of Permitted Acreage.--
    Notwithstanding any other provision of this Act, producers of a
    program crop who are participating in the production adjustment
    program for that program crop under this Act shall be allowed
    to plant that program crop in a quantity that exceeds the
    permitted acreage for that crop without losing their
    eligibility for loans, purchases, or payments with respect to
    that crop under this Act if--
              [(1) the acreage planted to the program crop on the
            farm in excess of the permitted acreage does not exceed
            25 percent of the crop acreage bases on the farm for
            other program crops; and
              [(2) the producer agrees to a reduction in permitted
            acreage for the other program crops produced on the
            farm by a quantity equal to the overplanting.
      [(e) Loan Eligibility.--
              [(1) In general.--Producers of a specific program
            crop (referred to in this subsection as the ``original
            program crop'') who plant for harvest on the crop
            acreage base established for such original program crop
            another program crop in accordance with this section
            and who are not participants in the program established
            for such other program crop shall be eligible to
            receive loans, purchases, or loan deficiency payments
            for such other program crop on the same terms and
            conditions as are provided to participants in a
            production adjustment program established for such
            other program crop.
              [(2) Requirements.--Producers shall be eligible to
            receive loans, purchases, or loan deficiency payments
            under this subsection if the producers--
                      [(A) plant such other program crop in an
                    amount that does not exceed 25 percent of the
                    crop acreage base established for the original
                    program crop; and
                      [(B) agree to a reduction in the permitted
                    acreage for the original program crop for the
                    particular crop year.

    [SEC. 505. FARM PROGRAM PAYMENT YIELDS.

      [(a) Establishment.--The Secretary shall provide for the
    establishment of a farm program payment yield for each farm for
    each program crop for each crop year in accordance with
    subsection (b) or (c).
      [(b) Farm Program Payment Yields Based on 1990 Crop Year.--
              [(1) In general.--If the Secretary determines that
            farm program payment yields shall be established in
            accordance with this subsection, except as provided in
            paragraphs (2) and (3), the farm program payment yield
            for each of the 1991 through 1997 crop years shall be
            the farm program payment yield for the 1990 crop year
            for the farm.
              [(2) Additional yield payments.--In the case of each
            of the 1991 through 1997 crop years for a commodity, if
            the farm program payment yield for a farm is reduced
            more than 10 percent below the farm program payment
            yield for the 1985 crop year, the Secretary shall make
            available to producers established price payments for
            the commodity in such amount as the Secretary
            determines is necessary to provide the same total
            return to producers as if the farm program payment
            yield had not been reduced more than 10 percent below
            the farm program payment yield for the 1985 crop year.
            The payments shall be made available not later than the
            time final deficiency payments are made.
              [(3) No crop or yield available.--If no crop of the
            commodity was produced on the farm or no farm program
            payment yield was established for the farm for any of
            the 1981 through 1985 crop years (or, as appropriate,
            the 1986 through 1990 crop years), the farm program
            payment yield shall be established on the basis of the
            average farm program payment yield for the crop years
            for similar farms in the area.
              [(4) National, state, or county yields.--If the
            Secretary determines the action is necessary, the
            Secretary may establish national, State, or county
            program payment yields on the basis of--
                      [(A) historical yields, as adjusted by the
                    Secretary to correct for abnormal factors
                    affecting the yields in the historical period;
                    or
                      [(B) the Secretary's estimate of actual
                    yields for the crop year involved if historical
                    yield data is not available.
              [(5) Balancing yields.--If national, State, or county
            program payment yields are established, the farm
            program payment yields shall balance to the national,
            State, or county program payment yields.
      [(c) Determination of Yields.--
              [(1) Actual yields.--With respect to the 1991 and
            subsequent crop years, the Secretary may--
                      [(A) establish the farm program payment yield
                    as provided in subsection (a); or
                      [(B) establish a farm program payment yield
                    for any program crop for any farm on the basis
                    of the average of the yield per harvested acre
                    for the crop for the farm for each of the 5
                    crop years immediately preceding the crop year,
                    excluding the crop year with the highest yield
                    per harvested acre, the crop year with the
                    lowest yield per harvested acre, and any crop
                    year in which such crop was not planted on the
                    farm.
              [(2) Prior yields.--For purposes of the preceding
            sentence, the farm program payment yield for the 1986
            crop year and the actual yield per harvested acre with
            respect to the 1987 and subsequent crop years shall be
            used in determining farm program payment yields.
              [(3) Reduction limitation.--Notwithstanding any other
            provision of this paragraph, for purposes of
            establishing a farm program payment yield for any
            program crop for any farm for the 1991 and subsequent
            crop years, the farm program payment yield for the 1986
            crop year may not be reduced more than 10 percent below
            the farm program payment yield for the farm for the
            1985 crop year.
              [(4) Adjustment of yields.--The county committee, in
            accordance with regulations prescribed by the
            Secretary, may adjust any farm program payment yield
            for any program crop for any farm if the farm program
            payment yield for the crop on the farm does not
            accurately reflect the productive potential of the
            farm.
      [(d) Assignment of Yields.--In the case of any farm for which
    the actual yield per harvested acre for any program crop
    referred to in subsection (c) for any crop year is not
    available, the county committee may assign the farm a yield for
    the crop for the crop year on the basis of actual yields for
    the crop for the crop year on similar farms in the area.
      [(e) Actual Yield Data.--
              [(1) Provision.--The Secretary shall, under such
            terms and conditions as the Secretary may prescribe,
            allow producers to provide to county committees data
            with respect to the actual yield for each farm for each
            program crop.
              [(2) Maintenance.--The Secretary shall maintain the
            data for at least 5 crop years after receipt in a
            manner that will permit the data to be used, if
            necessary, in the administration of the commodity
            programs.
              [(3) Notification.--The Secretary shall provide
            timely notification to producers of the provisions of
            this subsection.

    [SEC. 506. PLANTING AND PRODUCTION HISTORY OF FARMS.

      [Each county committee, in accordance with regulations
    prescribed by the Secretary, may require any producer who seeks
    to establish a crop acreage base or farm program payment yield
    for a farm for a crop year to provide planting and production
    history of the farm for each of the 5 crop years immediately
    preceding the crop year.

    [SEC. 507. ESTABLISHMENT OF BASES AND YIELDS BY COUNTY COMMITTEES.

      [Each county committee may, in accordance with regulations
    prescribed by the Secretary, provide for the establishment of a
    crop acreage base, and farm program payment yield with respect
    to any farm administratively located within the county if the
    crop acreage base or farm program payment yield cannot
    otherwise be established under this title. The crop acreage
    bases and farm program payment yields shall be established in a
    fair and equitable manner, but no such bases or farm program
    payment yields shall be established for a farm if the producer
    on the farm is subject to sanctions under any provision of
    Federal law for cultivating highly erodible land or converted
    wetland.

    [SEC. 508. APPEALS.

      [The Secretary shall establish an administrative appeal
    procedure that provides for an administrative review of
    determinations made with respect to crop acreage bases and farm
    program payment yields.

    [SEC. 509. CROPS.

      [Notwithstanding any other provision of law, this title shall
    be effective only for the 1991 through 1997 program crops.

           [TITLE VI--EMERGENCY LIVESTOCK FEED ASSISTANCE ACT OF 1988

                                  [SHORT TITLE

      [Sec. 601. This title may be cited as the ``Emergency
    Livestock Feed Assistance Act of 1988''.

                                  [DEFINITIONS

      [Sec. 602. As used in this title:
              [(1) The term ``livestock producer'' means--
                      [(A) a person that is actively engaged in
                    farming and that receives a substantial amount
                    of total income from the production of grain or
                    livestock, as determined by the Secretary, that
                    is--
                              [(i) an established producer or
                            husbander of livestock or a dairy
                            producer who is a citizen of, or legal
                            resident alien in, the United States;
                            or
                              [(ii) a farm cooperative, private
                            domestic corporation, partnership, or
                            joint operation in which a majority
                            interest is held by members,
                            stockholders, or partners who are
                            citizens of, or legal resident aliens
                            in, the United States, if such
                            cooperative, corporation, partnership,
                            or joint operation is engaged in
                            livestock production or husbandry, or
                            dairy production; or
                      [(B) Any of the following entities that is
                    actively engaged in livestock production or
                    husbandry, or dairy production--
                              [(i) any Indian tribe (as defined in
                            section 4(b) of the Indian Self-
                            Determination and Education Assistance
                            Act (25 U.S.C. 450(b)));
                              [(ii) any Indian organization or
                            entity chartered under the Act of June
                            18, 1934 (48 Stat. 984, chapter 576; 25
                            U.S.C. 461 et seq.), commonly known as
                            the ``Indian Reorganization Act'';
                              [(iii) any tribal organization (as
                            defined in section 4(c) of the Indian
                            Self-Determination and Education
                            Assistance Act (25 U.S.C. 450b(c))); or
                              [(iv) any economic enterprise (as
                            defined in section 3(e) of the Indian
                            Financing Act of 1974 (25 U.S.C.
                            1452(e)));
              [(2) The term ``livestock'' means cattle, sheep,
            goats, swine, poultry (including egg-producing
            poultry), equine animals used for food or in the
            production of food, fish used for food, and other
            animals designated by the Secretary (at the Secretary's
            sole discretion) that--
                      [(A) are part of a foundation herd (including
                    producing dairy cattle) or offspring; or
                      [(B) are purchased as part of a normal
                    operation and not to obtain additional benefits
                    under this title.
              [(3) The term ``State'' means any State of the United
            States, the Commonwealth of Puerto Rico, the Virgin
            Islands, or Guam.
              [(4) The term ``feed'', for the purposes of emergency
            feed assistance, means any type of feed (including feed
            grain, oilseed meal, premix or mixed feed, liquid or
            dry supplemental feed, roughage, pasture, or forage)
            that--
                      [(A) best suits the livestock producer's
                    operation; and
                      [(B) is consistent with acceptable feed
                    practices.
              [(5) The term ``area'' includes any Indian
            reservation (as defined in section 335(e)(1)(D)(ii) of
            the Consolidated Farm and Rural Development Act (7
            U.S.C. 1985(e)(1)(D)(ii))).

                        [EMERGENCY LIVESTOCK ASSISTANCE

      [Sec. 603. (a) The Secretary shall provide emergency feed
    assistance under this title for the preservation and
    maintenance of livestock in any State or area of a State where,
    because of disease, insect infestation, flood, drought, fire,
    hurricane, earthquake, storm, hot weather, or other natural
    disaster, the Secretary determines that a livestock emergency
    exists.
      [(b)(1) The Secretary shall provide emergency feed assistance
    under this title for the preservation and maintenance of
    livestock, to livestock producers that--
              [(A) conduct farming, ranching, or aquaculture
            operations in any county contiguous to a county where
            the Secretary has determined, under subsection (a),
            that a livestock emergency exists, and
              [(B) are otherwise eligible for assistance under this
            title.
      [(2) The Secretary shall accept applications for assistance
    under this subsection from producers that are affected by the
    livestock emergency at any time during the eight-month period
    beginning on the date on which the Secretary determines that
    such emergency exists in the other county.

                     [DETERMINATION OF NEED FOR ASSISTANCE

      [Sec. 604. (a)(1) Whenever the Governor of a State determines
    that a livestock emergency due to a natural disaster exists in
    the State, or a county committee established under section 8(b)
    of the Soil Conservation and Domestic Allotment Act (16 U.S.C.
    590(b)) determines that such an emergency exists in the county,
    the Governor or county committee may submit a request for a
    determination by the Secretary of a livestock emergency in such
    State or county and for emergency livestock feed assistance
    under this title.
      [(2) The request of a Governor or county committee for a
    livestock emergency determination and for emergency livestock
    feed assistance shall include, to the extent feasible,
    recommendations to the Secretary of those options that will
    most fully use feed available through local sources.
      [(b) The Secretary may consider a State, county, or area in a
    State for a livestock emergency determination and emergency
    livestock feed assistance under this title whether or not a
    request for assistance is submitted, as described in subsection
    (a).
      [(c) The Secretary shall act on requests for determinations
    under subsection (a) and make final determinations on whether a
    livestock emergency exists in any State, county, or area, under
    regulations that ensure thorough and prompt action (not later
    than 30 days after receipt of any such request) and provide for
    appropriate notification procedures.
      [(d) Notwithstanding the preceding provisions of this
    section, any State, county, or area determined eligible, due to
    drought or related conditions in 1988, for the emergency feed
    program or emergency feed assistance program conducted prior to
    the effective date of this title shall continue to be eligible
    for such programs and may be eligible for other programs under
    this title for such drought or related condition. As soon as
    practicable after the effective date of this title, the
    Secretary shall determine whether any of the programs described
    in section 606, other than the emergency feed program under
    section 606(a)(4) and the emergency feed assistance program
    under section 606(a)(2), or in section 607 should be made
    available in such State, county, or area. If the Secretary
    makes such determination, the Secretary shall make such
    programs immediately available to livestock producers in the
    State, county, or area.

                              [ELIGIBLE PRODUCERS

      [Sec. 605. (a)(1) If the Secretary determines that a
    livestock emergency exists in a State, county, or area,
    qualifying livestock producers located in such State, county,
    or area, or in a contiguous county as provided for in section
    603(b), shall be eligible (under application procedures
    established by the Secretary) for emergency feed assistance
    under this title in accordance with this subsection.
      [(2) For the purposes of this subsection, a ``qualifying
    livestock producer'' is a livestock producer who has suffered a
    substantial loss in feed normally produced on the farm for such
    producer's livestock as a result of the livestock emergency
    and, as a result, does not have sufficient feed that has
    adequate nutritive value and is suitable for each of such
    producer's particular types of livestock (as of the date of the
    request, or initiation of consideration, for a determination of
    a livestock emergency under section 604) for the estimated
    duration of the emergency.
      [(3) Each qualifying livestock producer shall be eligible for
    emergency feed assistance under the programs specified in
    section 606(a) that is made available where the producer is
    located in quantities sufficient to meet such feed deficiency
    with respect to the producer's livestock normally fed with feed
    produced by the producer.
      [(b) Each livestock producer in such State, county, or area,
    or in a contiguous county as provided for in section 603(b),
    regardless of whether the producer qualifies for assistance
    under subsection (a), shall be eligible for emergency
    assistance under the programs specified in section 607 that are
    made available where the producer is located.
      [(c) Any livestock producer, located in a county or area in
    which benefits under the emergency feed program or the
    emergency feed assistance program were made available due to
    the drought or related condition in 1988 prior to the effective
    date of this title, who qualifies for assistance under such
    pre-existing programs shall be eligible for assistance for such
    drought or related conditions as prescribed in subsection (a)
    or, at the producer's option, for assistance under such pre-
    existing programs.

                              [ASSISTANCE PROGRAMS

      [Sec. 606. (a) In accordance with section 605(a), the
    Secretary shall make one or more of the following assistance
    programs available to qualifying livestock producers in a
    State, county or area, if the Secretary determines that the
    livestock emergency in such State, county or area requires the
    implementation of such program:
              [(1) The donation of feed grain owned by the
            Commodity Credit Corporation to producers who are
            financially unable to purchase feed under paragraph (2)
            or to participate in any other program authorized under
            this subsection.
              [(2) The sale of feed grain owned by the Commodity
            Credit Corporation to producers for livestock feed at a
            price, established by the Secretary, that does not
            exceed--
                      [(A) with respect to such assistance provided
                    for any livestock emergency determined to exist
                    prior to January 1, 1989, 75 percent of the
                    current basic county loan rate for such feed
                    grain in effect under this Act (or at a
                    comparable price if there is no such current
                    basic county loan rate), or
                      [(B) with respect to such assistance provided
                    for any other livestock emergency, 50 percent
                    of the average market price in the county or
                    area involved, as determined by the Secretary.
              [(3) Reimbursement of any transportation and handling
            expenses incurred, not to exceed 50 percent of such
            expenses, by a producer in connection with feed grain
            donations or sales under paragraphs (1) and (2).
              [(4) Reimbursement of not to exceed 50 percent of the
            cost of feed purchased by a producer for the producer's
            livestock during the duration of the livestock
            emergency.
              [(5) Hay and forage transportation assistance to
            producers of not to exceed 50 percent of the cost of
            transporting hay or forage purchased from a point of
            origin beyond a producer's normal trade area to the
            livestock, subject to the following limitations:
                      [(A) The transportation assistance may not
                    exceed $50 per ton of eligible hay or forage
                    ($12.50 for silage).
                      [(B) The quantity of eligible hay and forage
                    for each producer may not exceed the lesser
                    of--
                              [(i) 20 pounds per day per eligible
                            animal unit; or
                              [(ii) the quantity of additional feed
                            needed by the producer for the duration
                            of the livestock emergency.
              [(6) Livestock transportation assistance to producers
            of not to exceed 50 percent of the cost of transporting
            livestock to and from available grazing locations,
            except that such assistance may not exceed the lesser
            of--
                      [(A) $24 per head of a producer's eligible
                    livestock; or
                      [(B) the local cost of the quantity of
                    additional feed needed by the producer for the
                    eligible livestock for duration of the
                    livestock emergency.
      [(b) If assistance is made available through the furnishing
    of feed grain under paragraph (1) or (2) of subsection (a), the
    Secretary--
              [(1) may provide for the furnishing of the feed grain
            through a dealer or manufacturer and the replacing of
            the feed grain so furnished from feed grain owned by
            the Commodity Credit Corporation; or
              [(2) at the option of the livestock producer, shall
            provide for the furnishing of the feed grain through
            the use of feed grain stored on the farm of the
            producer that has been pledged as collateral for a
            price support loan made under this Act.
      [(c) In providing assistance under paragraph (2) or (4) of
    subsection (a), the Secretary may make in-kind payments or
    reimbursements through the issuance of negotiable certificates
    that the Commodity Credit Corporation shall exchange for a
    commodity in accordance with rules prescribed by the Secretary.
      [(d) No payment or benefit provided under this section shall
    be payable or due until such time as a completed application
    therefor has been approved.
      [(e) A person eligible to receive a payment or benefit under
    this section with respect to a livestock emergency determined
    to exist prior to January 1, 1989, shall make application for
    such payment or benefit not later than March 31, 1989, or such
    later date that the Secretary, by regulation, may prescribe.
      [(f) The Secretary may make available at least $25,000,000 to
    provide livestock transportation assistance under subsection
    (a)(6) for livestock emergencies in 1989.

                             [ADDITIONAL ASSISTANCE

      [Sec. 607. (a) In addition to the assistance provided under
    section 606, if the Secretary determines that the livestock
    emergency also requires the implementation of one or more of
    the assistance programs described in subsection (b), the
    Secretary shall implement such programs.
      [(b) Special assistance under this section includes--
              [(1) the donation of feed owned by the Commodity
            Credit Corporation for use in feeding livestock
            stranded and unidentified as to its owner, including
            the cost of transporting feed to the affected area,
            during such period as the Secretary, by regulation, may
            prescribe;
              [(2) reimbursement of not to exceed 50 percent of the
            cost of--
                      [(A) installing pipelines (if that is the
                    least expensive method) or other facilities,
                    including tanks or troughs, for livestock
                    water;
                      [(B) construction or deepening of wells or
                    ponds for livestock water; or
                      [(C) developing springs or seeps for
                    livestock water,
            as appropriate in drought areas to facilitate more
            efficient and better-distributed grazing on land
            normally used for grazing. Such cost-share assistance
            may not be made available to provide water for wildlife
            or recreational livestock, dry lot feeding, or barns or
            corrals, or to acquire pumping equipment;
              [(3) reimbursement of not to exceed 50 percent of the
            cost of burning prickly pear cactus to make it suitable
            for animal feed; and
              [(4) making commodities owned by the Commodity Credit
            Corporation available to livestock producers through
            the use of a catalog that specifies lots of a size that
            are economically feasible for a small producer to
            obtain by means of certificate exchanges.
      [(c) The Secretary may make available at least $25,000,000 to
    provide special assistance under subsection (b)(2) for
    livestock emergencies in 1988 and 1989.

                    [USE OF THE COMMODITY CREDIT CORPORATION

      [Sec. 608. The Secretary shall carry out this title through
    the use of the funds, facilities, and authorities of the
    Commodity Credit Corporation.

                              [BENEFITS LIMITATION

      [Sec. 609. (a) The total amount of benefits that a person
    shall be entitled to receive annually under one or more of the
    programs established under this title may not exceed $50,000.
      [(b) The Secretary shall issue regulations--
              [(1) defining the term ``person'', which shall
            conform, to the extent practicable, to the regulations
            defining the term ``person'' issued under section 1001
            of the Food Security Act of 1985, or successor statute;
              [(2) prescribing such rules as the Secretary
            determines necessary to ensure a fair and reasonable
            application of the limitation established under this
            section; and
              [(3) providing that the term ``person'' shall
            include, in the case of any cooperative association of
            producers, each member of the association with respect
            to benefits due to such member of the association.
      [(c) No person may receive benefits under this title
    attributable to lost production of a feed commodity due to a
    natural disaster in 1988 to the extent that such person
    receives a disaster payment under the Disaster Assistance Act
    of 1988 on such lost production.
      [(d) Each person otherwise eligible for a livestock emergency
    benefit under this title in 1988 shall be subject to the
    combined payment and benefits limitation established under
    section 211(c) of the Disaster Assistance Act of 1988.

                                 [INELIGIBILITY

      [Sec. 610. (a) Any person that has qualifying gross revenues
    in excess of $2,500,000 annually, as determined by the
    Secretary, shall not be eligible to receive any livestock
    emergency benefits under this title.
      [(b) For purposes of this section, the term ``qualifying
    gross revenue'' means--
              [(1) if a majority of the person's annual income is
            received from farming and ranching operations, the
            gross revenue from the person's farming and ranching
            operations; and
              [(2) if less than a majority of the person's annual
            income is received from farming and ranching
            operations, the person's gross revenue from all
            sources.

                                [ADMINISTRATION

      [Sec. 611. (a) The Commodity Credit Corporation shall issue
    regulations to carry out this title.
      [(b) Such regulations shall establish procedures to ensure
    that the request for assistance by a Governor or county
    committee under section 604, and individual applications of
    livestock producers under section 605 for assistance, are
    processed and decisions thereon are made as quickly as
    practicable.
      [(c) For purposes of this title, indigenous plants available
    to a livestock producer but not normally consumed by livestock
    as feed, such as cactus, may not be considered as feed on hand
    for such producers.

                                   [PENALTIES

      [Sec. 612. A person that disposes of any feed made available
    to a livestock producer under this title other than as
    authorized by the Secretary shall be (1) subject to a civil
    penalty equal to the market value of the feed involved, to be
    recovered by the Secretary in a civil suit brought for that
    purpose, and (2) guilty of a misdemeanor and, on conviction
    thereof, subject to a fine of not more than $1,000, or
    imprisonment for not more than one year, or both.]
                                  ----------

                   DAIRY PRODUCTION STABILIZATION ACT OF 1983

                                 TITLE I--DAIRY

                                  short title

      Sec. 101. This title may be cited as the ``Dairy Production
    Stabilization Act of 1983''.
              * * * * * * *

                      Subtitle B--Dairy Promotion Program

                       findings and declaration of policy

      Sec. 110. (a)  * * *
      (b) It, therefore, is declared to be the policy of Congress
    that it is in the public interest to authorize the
    establishment, through the exercise of the powers provided
    herein, of an orderly procedure for financing (through
    assessments on all milk produced in the United States for
    commercial use and dairy products imported into the United
    States) and carrying out a coordinated program of promotion
    designed to strengthen the dairy industry's position in the
    marketplace and to maintain and expand domestic and foreign
    markets and uses for fluid milk and dairy products produced in
    the United States. Nothing in this subtitle may be construed to
    provide for the control of production or otherwise limit the
    right of individual milk producers to produce milk.

                                  definitions

      Sec. 111. As used in this subtitle--
              (a)  * * *
              * * * * * * *
              (d) the term ``milk'' means any class of cow's milk
            produced in the United States or cow's milk imported
            into the United States in the form of dairy products
            intended for consumption in the United States;
              (e) the term ``dairy products'' means products
            manufactured for human consumption which are derived
            from the processing of milk, and includes fluid milk
            products and casein (except casein imported under
            sections 3501.90.20 (casein glue) and 3501.90.50
            (other) of the Harmonized Tariff Schedule);
              * * * * * * *
              (j) the term ``research'' means studies testing the
            effectiveness of market development and promotion
            efforts, studies relating to the nutritional value of
            milk and dairy products, and other related efforts to
            expand demand for milk and dairy products or to reduce
            the costs associated with processing or marketing those
            products;
              (k) the term ``nutrition education'' means those
            activities intended to broaden the understanding of
            sound nutritional principles including the role of milk
            and dairy products in a balanced diet; [and]
              [(l) the term ``United States'' as used in sections
            110 through 117 means the forty-eight contiguous States
            in the continental United States.]
              (l) the term ``United States'' means the several
            States and the District of Columbia;
              (m) the term ``importer'' means the first person to
            take title to dairy products imported into the United
            States for domestic consumption; and
              (n) the term ``exporter'' means any person who
            exports dairy products from the United States.
              * * * * * * *

                            required terms in orders

      Sec. 113. Any order issued under this subtitle shall contain
    terms and conditions as follows:
      (a)  * * *
      (b) The order shall provide for the establishment and
    appointment by the Secretary of a National Dairy Promotion and
    Research Board that shall consist of not less than [thirty-six
    members] 38 members, including one representative of importers
    and one representative of exporters to be appointed by the
    Secretary. [Members] The remaining members of the Board shall
    be milk producers appointed by the Secretary from nominations
    submitted by eligible organizations certified under section 114
    of this subtitle, or, if the Secretary determines that a
    substantial number of milk producers are not members of, or
    their interests are not represented by, any such eligible
    organization, then from nominations made by such milk producers
    in the manner authorized by the Secretary. In making such
    appointments, the Secretary shall take into account, to the
    extent practicable, the geographical distribution of milk
    production volume throughout the [United States] United States,
    including Alaska and Hawaii. In determining geographic
    representation, whole States shall be considered as a unit. A
    region may be represented by more than one director and a
    region may be made up of more than one State. The term of
    appointment to the Board shall be for three years with no
    member serving more than two consecutive terms, except that
    initial appointments shall be proportionately for one-year,
    two-year, and three-year terms. The Board shall appoint from
    its members an executive committee whose membership shall
    equally reflect each of the different regions in the United
    States in which milk is produced. The executive committee shall
    have such duties and powers as are conferred upon it by the
    Board. Board members shall serve without compensation, but
    shall be reimbursed for their reasonable expenses incurred in
    performing their duties as members of the Board including a per
    diem allowance as recommended by the Board and approved by the
    Secretary.
              * * * * * * *
      (e) The order shall require the Board to submit to the
    Secretary for approval budgets on a fiscal period basis of its
    anticipated expenses and disbursements in the administration of
    the order, including projected costs of dairy products
    promotion and research projects. For each of the fiscal years
    1996 through 2000, the Board's budget shall provide for the
    expenditure of not less than 10 percent of the anticipated
    revenues available to the Board to develop international
    markets for, and to promote within such markets, the
    consumption of dairy products produced in the United States
    from milk produced in the United States.
              * * * * * * *
      (g)(1) The order shall provide that each person making
    payment to a producer for milk produced in the United States
    and purchased from the producer shall, in the manner as
    prescribed by the order, collect an assessment based upon the
    number of hundredweights of milk for commercial use handled for
    the account of the producer and remit the assessment to the
    Board. The assessment shall be used for payment of the expenses
    in administering the order, with provision for a reasonable
    reserve, and shall include those administrative costs incurred
    by the Department after an order has been promulgated under
    this subtitle. The rate of assessment prescribed by the order
    shall be 15 cents per hundredweight of milk for commercial use
    or the equivalent thereof. A milk producer or the producer's
    cooperative who can establish that the producer is
    participating in active, ongoing qualified State or regional
    dairy product promotion or nutrition education programs
    intended to increase consumption of milk and dairy products
    generally shall receive credit in determining the assessment
    due from such producer for contributions to such programs of up
    to 10 cents per hundredweight of milk marketed or, for the
    period ending six months after the date of enactment of this
    Act, up to the aggregate rate in effect on the date of
    enactment of this Act of such contributions to such programs
    (but not to exceed 15 cents per hundredweight of milk marketed)
    if such aggregate rate exceeds 10 cents per hundredweight of
    milk marketed. Any person marketing milk of that person's own
    production directly to consumers shall remit the assessment
    directly to the Board in the manner prescribed by the order.
      (2) The order shall provide that each importer of dairy
    products intended for consumption in the United States shall
    remit to the Board, in the manner prescribed by the order, an
    assessment equal to 1.2 cents per pound of total milk solids
    contained in the imported dairy products, or 15 cents per
    hundredweight of milk contained in the imported dairy products,
    whichever is less. If an importer can establish that it is
    participating in active, ongoing qualified State or regional
    dairy product promotion or nutrition programs intended to
    increase the consumption of milk and dairy products, the
    importer shall receive credit in determining the assessment due
    from that importer for contributions to such programs of up to
    .8 cents per pound of total milk solids contained in the
    imported dairy products, or 10 cents per hundredweight of milk
    contained in the imported dairy products, whichever is less.
    The assessment collected under this paragraph shall be used for
    the purpose specified in paragraph (1).
              * * * * * * *
      (k) The order shall require that each person receiving milk
    from farmers for commercial use, each importer of dairy
    products, and any person marketing milk of that person's own
    production directly to consumers, maintain and make available
    for inspection such books and records as may be required by the
    order and file reports at the time, in the manner, and having
    the content prescribed by the order. Such information shall be
    made available to the Secretary as is appropriate to the
    administration or enforcement of this subtitle, or any order or
    regulation issued under this subtitle. All information so
    obtained shall be kept confidential by all officers and
    employees of the Department, and only such information so
    obtained as the Secretary deems relevant may be disclosed by
    them and then only in a suit or administrative hearing brought
    at the request of the Secretary, or to which the Secretary or
    any officer of the United States is a party, and involving the
    order with reference to which the information to be disclosed
    was obtained. Nothing in this subsection may be deemed to
    prohibit (1) the issuance of general statements, based upon the
    reports, of the number of persons subject to an order or
    statistical data collected therefrom, which statements do not
    identify the information furnished by any person, or (2) the
    publication, by direction of the Secretary, of the name of any
    person violating any order, together with a statement of the
    particular provisions of the order violated by such person. No
    information obtained under the authority of this subtitle may
    be made available to any agency or officer of the Federal
    Government for any purpose other than the implementation of
    this subtitle and any investigatory or enforcement action
    necessary for the implementation of this subtitle. Any person
    violating the provisions of this subsection shall, upon
    conviction, be subject to a fine of not more than $1,000, or to
    imprisonment for not more than one year, or both, and, if an
    officer or employee of the Board or the Department, shall be
    removed from office.
              * * * * * * *

                      suspension and termination of orders

      Sec. 116. (a)  * * *
      (b) After September 30, 1985, the Secretary may conduct a
    referendum at any time, and shall hold a referendum on request
    of a representative group comprising 10 per centum or more of
    the number of producers and importers subject to the order, to
    determine whether the producers and importers favor the
    termination or suspension of the order. The Secretary shall
    suspend or terminate collection of assessments under the order
    within six months after the Secretary determines that
    suspension or termination of the order is favored by a majority
    of the producers and importers voting in the referendum [who,
    during a representative period (as determined by the
    Secretary), have been engaged in the production of milk for
    commercial use] and shall terminate the order in an orderly
    manner as soon as practicable after such determination. A
    producer shall be eligible to vote in the referendum if the
    producer, during a representative period (as determined by the
    Secretary), has been engaged in the production of milk for
    commercial use. An importer shall be eligible to vote in the
    referendum if the importer, during a representative period (as
    determined by the Secretary), has been engaged in the
    importation of dairy products into the United States intended
    for consumption in the United States.
              * * * * * * *
                                  ----------

             FOOD, AGRICULTURE, CONSERVATION, AND TRADE ACT OF 1990

              * * * * * * *

                                 TITLE I--DAIRY

              * * * * * * *

    [SEC. 102. MILK MANUFACTURING MARKETING ADJUSTMENT.

      [(a) In General.--Effective beginning on the date that is 12
    months after the date of enactment of this Act, no State shall
    provide for (and no person shall collect, directly or
    indirectly) a greater allowance for the processing of milk
    (hereafter referred to as a ``make allowance'') than is
    permitted under a Federal program to establish a Grade A price
    for manufacturing butter, nonfat dry milk, or cheese.
      [(b) Liability for Penalties.--
              [(1) In general.--If the Secretary of Agriculture
            determines that--
                      [(A) based on a request by a producer
                    supported by evidence, the make allowance
                    collected by a person is in excess of the
                    amount that is permitted under subsection (a);
                    or
                      [(B) a person has failed to comply with any
                    requirement of this section or a regulation
                    issued under this section,
            [the person shall be liable for penalties as determined
            by the Secretary in accordance with this subsection.
              [(2) Amount of penalties.--Such penalties shall be
            equal to the product obtained by multiplying--
                      [(A) twice the permitted make allowance that
                    could be charged as provided under subsection
                    (a); by
                      [(B) the quantity of milk with respect to
                    which the person was determined by the
                    Secretary to have collected a make allowance in
                    excess of the permitted make allowance.
      [(c) Regulations.--The Secretary may issue such regulations
    as are necessary to carry out this section.
      [(d) Investigations.--
              [(1) In general.--The Secretary may make such
            investigations as the Secretary considers necessary for
            the effective administration of this section or to
            determine whether any person subject to this section
            has violated this section.
              [(2) Administration.--For the purpose of the
            investigation, the Secretary may administer oaths and
            affirmations, subpoena witnesses, compel their
            attendance, take evidence, and require the production
            of any records that are relevant to the inquiry.
              [(3) Subpoena.--The attendance of witnesses and the
            production of any such records may be required from any
            place in the United States. In case of contumacy by, or
            refusal to obey a subpoena to, any person, the
            Secretary may invoke the aid of any court of the United
            States within the jurisdiction of which the
            investigation or proceeding is carried on, or where the
            person resides or carries on business, in requiring the
            attendance and testimony of witnesses and the
            production of records. The court may issue an order
            requiring the attendance and testimony of witnesses and
            the production of records, or requiring the person to
            appear before the Secretary to produce records or to
            give testimony on the matter under investigation.
              [(4) Contempt.--Any failure to obey the order of the
            court may be punished by the court as a contempt
            thereof.
              [(5) Process.--All process in any such case may be
            served in the judicial district of which the person is
            an inhabitant or wherever the person may be found.
      [(e) Enforcement.--The district courts of the United States
    are vested with jurisdiction specifically to enforce, and to
    prevent and restrain any person from violating, any provision
    of this section or any regulation issued under this section.]
              * * * * * * *

                      TITLE XXV--OTHER RELATED PROVISIONS

              * * * * * * *

    SEC. 2509. COLLECTION OF FEES FOR INSPECTION SERVICES.

      [(a) Quarantine, Inspection and Transportation Fees.--
              [(1) Quarantine and inspection.--
                      [(A) In general.--The Secretary of
                    Agriculture (hereafter referred to in this
                    section as the ``Secretary'') may prescribe and
                    collect fees to cover the cost of providing
                    agricultural quarantine and inspection services
                    in connection with the arrival at a port in the
                    customs territory of the United States, or the
                    preclearance or preinspection at a site outside
                    the customs territory of the United States, of
                    an international passenger, commercial vessel,
                    commercial aircraft, commercial truck, or
                    railroad car.
                      [(B) Airport inspection services.--For
                    airport inspection services, the Secretary
                    shall collect no more than $69,000,000 in
                    fiscal year 1992 and $75,000,000 in fiscal year
                    1993 from international airline passengers and
                    commercial aircraft operators.
                      [(C) Commercial truck and railroad car
                    inspection services.--For commercial truck and
                    railroad car inspection services, the Secretary
                    shall collect no more than $3,667,000 in fiscal
                    year 1992 and $3,890,000 in fiscal year 1993
                    from commercial truck and railroad car
                    operators.
                      [(D) Costs.--Fees, including fees from
                    international airline passengers and commercial
                    aircraft operators, may only be collected to
                    the extent that the Secretary reasonably
                    estimates that the amount of the fees are
                    commensurate with the costs of agricultural
                    quarantine and inspection services with respect
                    to the class of persons or entities paying the
                    fees. The costs of such services with respect
                    to passengers as a class includes the costs of
                    related inspections of the aircraft.
              [(2) Treasury.--Any person who collects a fee under
            this subsection shall remit such fee to the Treasury of
            the United States prior to the date that is 31 days
            after the close of the calendar quarter in which such
            fee is collected.
              [(3) Agricultural quarantine inspection user fee
            account.--
                      [(A) Establishment.--There is established in
                    the Treasury of the United States a no-year
                    fund, to be known as the ``Agricultural
                    Quarantine Inspection User Fee Account''
                    (hereafter referred to in this section as the
                    ``Account''), for the use of the Secretary for
                    quarantine or inspection services under this
                    section.
                      [(B) Amounts in account.--
                              [(i) Deposits.--All of the fees
                            collected under this subsection shall
                            be deposited in the Account.
                              [(ii) Reimbursement.--The Secretary
                            of the Treasury shall use the Account
                            to provide reimbursements to any
                            appropriation accounts that incur the
                            costs associated with the
                            administration of this subsection and
                            all other activities carried out by the
                            Secretary at ports in the customs
                            territory of the United States and at
                            preclearance or preinspection sites
                            outside the customs territory of the
                            United States in connection with the
                            enforcement of the animal quarantine
                            laws. Any such reimbursement shall be
                            subject to appropriations under clause
                            (v).
                              [(iii) Procedure.--The Secretary of
                            the Treasury shall make reimbursement
                            under clause (ii) on a quarterly basis.
                            Amounts required to be reimbursed under
                            clause (ii), shall be made on the basis
                            of estimates made by the Secretary of
                            the expenses described in clause (ii)
                            that are incurred by the Secretary in
                            the 3-month period immediately
                            preceding such reimbursement.
                              [(iv) Adjustments.--Adjustments of
                            reimbursements made under clause (ii)
                            shall be made to the extent necessary
                            to correct prior estimates that were in
                            excess of, or less than, the amount
                            required to be reimbursed under clause
                            (iii).
                              [(v) Authorization of
                            appropriations.--There are authorized
                            to be appropriated each fiscal year
                            amounts in the Fund for use for
                            quarantine or inspection services.
              [(4) Adjustment in fee amounts.--Subject to the
            limits set forth in paragraph (1), the Secretary shall
            adjust the amount of the fees to be assessed under this
            subsection to reflect the cost to the Secretary in
            administering such subsection, in carrying out the
            activities at ports in customs territory of the United
            States and preclearance and preinspection sites outside
            the customs territory of the United States in
            connection with the provision of agricultural
            quarantine inspection services, and in maintaining a
            reasonable balance in the Account.]
      (a) Quarantine and Inspection Fees.--
              (1) Fees authorized.--The Secretary of Agriculture
            may prescribe and collect fees sufficient--
                      (A) to cover the cost of providing
                    agricultural quarantine and inspection services
                    in connection with the arrival at a port in the
                    customs territory of the United States, or the
                    preclearance or preinspection at a site outside
                    the customs territory of the United States, of
                    an international passenger, commercial vessel,
                    commercial aircraft, commercial truck, or
                    railroad car;
                      (B) to cover the cost of administering this
                    subsection; and
                      (C) through fiscal year 2002, to maintain a
                    reasonable balance in the Agricultural
                    Quarantine Inspection User Fee Account
                    established under paragraph (5).
              (2) Limitation.--In setting the fees under paragraph
            (1), the Secretary shall ensure that the amount of the
            fees are commensurate with the costs of agricultural
            quarantine and inspection services with respect to the
            class of persons or entities paying the fees. The costs
            of the services with respect to passengers as a class
            includes the costs of related inspections of the
            aircraft or other vehicle.
              (3) Status of fees.--Fees collected under this
            subsection by any person on behalf of the Secretary are
            held in trust for the United States and shall be
            remitted to the Secretary in such manner and at such
            times as the Secretary may prescribe.
              (4) Late payment penalties.--If a person subject to a
            fee under this subsection fails to pay the fee when
            due, the Secretary shall assess a late payment penalty,
            and the overdue fees shall accrue interest, as required
            by section 3717 of title 31, United States Code.
              (5) Agricultural quarantine inspection user fee
            account.--
                      (A) Establishment.--There is established in
                    the Treasury of the United States a no-year
                    fund, to be known as the ``Agricultural
                    Quarantine Inspection User Fee Account'', which
                    shall contain all of the fees collected under
                    this subsection and late payment penalties and
                    interest charges collected under paragraph (4)
                    through fiscal year 2002.
                      (B) Use of account.--For each of the fiscal
                    years 1996 through 2002, funds in the
                    Agricultural Quarantine Inspection User Fee
                    Account shall be available, in such amounts as
                    are provided in advance in appropriations Acts,
                    to cover the costs associated with the
                    provision of agricultural quarantine and
                    inspection services and the administration of
                    this subsection. Amounts made available under
                    this subparagraph shall be available until
                    expended.
                      (C) Excess fees.--Fees and other amounts
                    collected under this subsection in any of the
                    fiscal years 1996 through 2002 in excess of
                    $100,000,000 shall be available for the
                    purposes specified in subparagraph (B) until
                    expended, without further appropriation.
              (6) Use of amounts collected after fiscal year
            2002.--After September 30, 2002, the unobligated
            balance in the Agricultural Quarantine Inspection User
            Fee Account and fees and other amounts collected under
            this subsection shall be credited to the Department of
            Agriculture accounts that incur the costs associated
            with the provision of agricultural quarantine and
            inspection services and the administration of this
            subsection. The fees and other amounts shall remain
            available to the Secretary until expended without
            fiscal year limitation.
              (7) Staff years.--The number of full-time equivalent
            positions in the Department of Agriculture attributable
            to the provision of agricultural quarantine and
            inspection services and the administration of this
            subsection shall not be counted toward the limitation
            on the total number of full-time equivalent positions
            in all agencies specified in section 5(b) of the
            Federal Workforce Restructuring Act of 1994 (Public Law
            103-226; 5 U.S.C. 3101 note) or other limitation on the
            total number of full-time equivalent positions.
              * * * * * * *
                                  ----------

                 SECTION 8C OF THE AGRICULTURAL ADJUSTMENT ACT

                                     ORDERS

      Sec. 8c. (1)  * * *
              * * * * * * *

                          terms--milk and its products

      (5) In the case of milk and its products, orders issued
    pursuant to this section shall contain one or more of the
    following terms and conditions, and (except as provided in
    subsection (7) of this section no others:
      (A) Classifying milk in accordance with the form in which or
    the purpose for which it is used, and fixing, or providing a
    method for fixing, minimum prices for each such use
    classification which all handlers shall pay, and the time when
    payments shall be made, for milk purchased from producers or
    associations of producers. Such prices shall be uniform as to
    all handlers, subject only to adjustments for (1) volume,
    market, and production differentials customarily applied by the
    handlers subject to such order, (2) the grade or quality of the
    milk purchased, and (3) the locations at which delivery of such
    milk, or any use classification thereof, is made to such
    handlers. [Throughout the 2-year period beginning on the
    effective date of this sentence (and subsequent to such 2-year
    period unless modified by amendment to the order involved), the
    minimum aggregate amount of the adjustments, under clauses (1)
    and (2) of the preceding sentence, to prices for milk of the
    highest use classification under orders that are in effect
    under this section on the date of the enactment of the Food
    Security Act of 1985 shall be as follows:

                                                    Minimum Aggregate Dollar
                                                  Amount of Such Adjustments
                                                   Per Hundredweight of Milk
    [Marketing Area Subject to Order              Having 3.5 Percent Milkfat

        New England................................................... $3.24
        New York-New Jersey...........................................  3.14
        Middle Atlantic...............................................  3.03
        Georgia.......................................................  3.08
        Alabama-West Florida..........................................  3.08
        Upper Florida.................................................  3.58
        Tampa Bay.....................................................  3.88
        Southeastern Florida..........................................  4.18
        Michigan Upper Peninsula......................................  1.35
        South Michigan................................................  1.75
        Eastern Ohio-Western Pennsylvania.............................  1.95
        Ohio Valley...................................................  2.04
        Indiana.......................................................  2.00
        Chicago Regional..............................................  1.40
        Central Illinois..............................................  1.61
        Southern Illinois.............................................  1.92
        Louisville-Lexington-Evansville...............................  2.11
        Upper Midwest.................................................  1.20
        Eastern South Dakota..........................................  1.50
        Black Hills, South Dakota.....................................  2.05
        Iowa..........................................................  1.55
        Nebraska-Western Iowa.........................................  1.75
        Greater Kansas City...........................................  1.92
        Tennessee Valley..............................................  2.77
        Nashville, Tennessee..........................................  2.52
        Paducah, Kentucky.............................................  2.39
        Memphis, Tennessee............................................  2.77
        Central Arkansas..............................................  2.77
        Fort Smith, Arkansas..........................................  2.77
        Southwest Plains..............................................  2.77
        Texas Panhandle...............................................  2.49
        Lubbock-Plainview, Texas......................................  2.49
        Texas.........................................................  3.28
        Greater Louisiana.............................................  3.28
        New Orleans-Mississippi.......................................  3.85
        Eastern Colorado..............................................  2.73
        Western Colorado..............................................  2.00
        Southwestern Idaho-Eastern Oregon.............................  1.50
        Great Basin...................................................  1.90
        Lake Mead.....................................................  1.60
        Central Arizona...............................................  2.52
        Rio Grande Valley.............................................  2.35
        Puget Sound-Inland............................................  1.85
        Oregon-Washington.............................................  1.95

    Effective at the beginning of such two-year period, the minimum
    prices for milk of the highest use classification shall be
    adjusted for the locations at which delivery of such milk is
    made to such handlers.]
              * * * * * * *
                                  ----------

       SECTION 725 OF THE AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG
         ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS ACT, 1996

      Sec. 725. None of the funds appropriated or otherwise made
    available by this Act shall be used to enroll additional acres
    in the Conservation Reserve Program authorized by 16 U.S.C.
    3831-3845[: Provided, That 1,579,000 new acres shall be
    enrolled in the program in the year beginning January 1, 1997].
                                  ----------

                         AGRICULTURAL TRADE ACT OF 1978

              * * * * * * *

                     TITLE II--AGRICULTURAL EXPORT PROGRAMS

              * * * * * * *

                           Subtitle B--Implementation

    SEC. 211. FUNDING LEVELS.

      (a)  * * *
              * * * * * * *
      (c) Marketing Promotion Programs.--The Commodity Credit
    Corporation or the Secretary shall make available for market
    promotion activities authorized to be carried out by the
    Commodity Credit Corporation under section 203--
              (1) in addition to any funds that may be specifically
            appropriated to implement a market development program,
            not less than $200,000,000 for each of the fiscal years
            1991 through 1993, [and] not less than $110,000,000 for
            each of the fiscal years 1994 [through 1997,] through
            1995, and not more than $100,000,000 for each of fiscal
            years 1996 through 2002, of the funds of, or an equal
            value of commodities owned by, the Commodity Credit
            Corporation; and
              * * * * * * *

                     TITLE III--EXPORT ENHANCEMENT PROGRAM

    SEC. 301. EXPORT ENHANCEMENT PROGRAM.

      (a)  * * *
              * * * * * * *
      (e) Funding Levels.--
              [(1) In general.--The Commodity Credit Corporation
            shall make available for each of the fiscal years 1991
            through 2001 not less than $500,000,000 of the funds or
            commodities of the Commodity Credit Corporation to
            carry out the program established under this section.]
              (1) In general.--The Commodity Credit Corporation
            shall make available to carry out the program
            established under this section not more than--
                      (A) $350,000,000 for fiscal year 1996;
                      (B) $350,000,000 for fiscal year 1997;
                      (C) $500,000,000 for fiscal year 1998;
                      (D) $550,000,000 for fiscal year 1999;
                      (E) $579,000,000 for fiscal year 2000;
                      (F) $478,000,000 for fiscal year 2001; and
                      (G) $478,000,000 for fiscal year 2002.
              * * * * * * *
                                  ----------

                           FEDERAL CROP INSURANCE ACT

              * * * * * * *

    SEC. 508. CROP INSURANCE.

      (a)  * * *
      (b) Catastrophic Risk Protection.--
              (1)  * * *
              * * * * * * *
              (4) Sale of catastrophic risk coverage.--
                      (A)  * * *
              * * * * * * *
                      (C) Delivery of coverage.--
                              (i) In general.--In full consultation
                            with approved insurance providers, the
                            Secretary may continue to offer
                            catastrophic risk protection in a State
                            (or a portion of a State) through local
                            offices of the Department if the
                            Secretary determines that there is an
                            insufficient number of approved
                            insurance providers operating in the
                            State or portion to adequately provide
                            catastrophic risk protection coverage
                            to producers.
                              (ii) Coverage by approved insurance
                            providers.--To the extent that
                            catastrophic risk protection coverage
                            by approved insurance providers is
                            sufficiently available in a State as
                            determined by the Secretary, only
                            approved insurance providers may
                            provide the coverage in the State.
                              (iii) Current policies.--Subject to
                            clause (ii), all catastrophic risk
                            protection policies written by local
                            offices of the Department shall be
                            transferred (including all fees
                            collected for the crop year in which
                            the approved insurance provider will
                            assume the policies) to the approved
                            insurance provider for performance of
                            all sales, service, and loss adjustment
                            functions.
              * * * * * * *
              (7) Eligibility for department programs.--
                      [(A) In general.--To be eligible for any
                    price support or production adjustment program,
                    the conservation reserve program, or any
                    benefit described in section 371 of the
                    Consolidated Farm and Rural Development Act,
                    the producer must obtain at least the
                    catastrophic level of insurance for each crop
                    of economic significance grown on each farm in
                    the county in which the producer has an
                    interest, if insurance is available in the
                    county for the crop.]
                      (A) In general.--Effective for the spring-
                    planted 1996 and subsequent crops, to be
                    eligible for any payment or loan under title I
                    of the Agricultural Market Transition Act or
                    the Agricultural Adjustment Act of 1938 (7
                    U.S.C. 1281 et seq.), for the conservation
                    reserve program, or for any benefit described
                    in section 371 of the Consolidated Farm and
                    Rural Development Act (7 U.S.C. 2008f), a
                    person shall--
                              (i) obtain at least the catastrophic
                            level of insurance for each crop of
                            economic significance in which the
                            person has an interest; or
                              (ii) provide a written waiver to the
                            Secretary that waives any eligibility
                            for emergency crop loss assistance in
                            connection with the crop.
              * * * * * * *

    SEC. 519. NONINSURED CROP DISASTER ASSISTANCE PROGRAM.

      (a) Establishment of Program.--
              (1)  * * *
              (2) Eligible crops.--
                      (A)  * * *
                      (B) Crops specifically included.--The term
                    ``eligible crop'' shall include floricultural,
                    ornamental nursery, and Christmas tree crops,
                    turfgrass sod, seed crops, and industrial
                    crops.
              * * * * * * *
                                  ----------

              DEPARTMENT OF AGRICULTURE REORGANIZATION ACT OF 1994

              * * * * * * *

    SEC. 226. CONSOLIDATED FARM SERVICE AGENCY.

      (a) Establishment.--The Secretary is authorized to establish
    and maintain in the Department a Consolidated Farm Service
    Agency.
      (b) Functions of Consolidated Farm Service Agency.--If the
    Secretary establishes the Consolidated Farm Service Agency
    under subsection (a), the Secretary is authorized to assign to
    the Agency jurisdiction over the following functions:
              (1) Agricultural price and income support programs,
            production adjustment programs, and related programs.
              [(2) General supervision of the Federal Crop
            Insurance Corporation.]
              * * * * * * *

    SEC. 226A. OFFICE OF RISK MANAGEMENT.

      (a) Establishment.--Subject to subsection (e), the Secretary
    shall establish and maintain in the Department an independent
    Office of Risk Management.
      (b) Functions of the Office of Risk Management.--The Office
    of Risk Management shall have jurisdiction over the following
    functions:
              (1) Supervision of the Federal Crop Insurance
            Corporation.
              (2) Administration and oversight of all aspects,
            including delivery through local offices of the
            Department, of all programs authorized under the
            Federal Crop Insurance Act (7 U.S.C. 1501 et seq.).
              (3) Any pilot or other programs involving revenue
            insurance, risk management savings accounts, or the use
            of the futures market to manage risk and support farm
            income that may be established under the Federal Crop
            Insurance Act or other law.
              (4) Such other functions as the Secretary considers
            appropriate.
      (c) Administrator.--
              (1) The Office of Risk Management shall be headed by
            an Administrator who shall be appointed by the
            Secretary.
              (2) The Administrator of the Office of Risk
            Management shall also serve as Manager of the Federal
            Crop Insurance Corporation.
      (d) Resources.--
              (1) Functional coordination.--Certain functions of
            the Office of Risk Management, such as human resources,
            public affairs, and legislative affairs, may be
            provided by a consolidation of such functions under the
            Under Secretary of Agriculture for Farm and Foreign
            Agricultural Services.
              (2) Minimum provisions.--Notwithstanding paragraph
            (1) or any other provision of law or order of the
            Secretary, the Secretary shall provide the Office of
            Risk Management with human and capital resources
            sufficient for the Office to carry out its functions in
            a timely and efficient manner.
              * * * * * * *
                                  ----------

    SECTION 408 OF THE AGRICULTURAL TRADE DEVELOPMENT AND ASSISTANCE ACT OF
                                      1954

    SEC. 408. EXPIRATION DATE.

      No agreements to finance sales or to provide other assistance
    under this Act shall be entered into after December 31, [1995]
    1996.
                                 MINORITY VIEWS

        We strongly oppose H.R. 2854. We are greatly alarmed by its
    provisions and what their impact will be. On behalf of the
    American people we protest the closed, anti-democratic process
    that has been employed by this Republican-controlled Congress
    and the disregard it has demonstrated towards the principles
    all Americans hold dear--rural and urban alike.
        The American farm is the very foundation of the progress
    that has marked our nation's history. American farmers and
    ranchers ensure that ours are the best fed people in the world.
    Because of our farmers' productivity, Americans pay a lower
    share of their disposable income for their diet than do the
    citizens of any other industrialized nation. It was Thomas
    Jefferson who wrote that ``cultivators of the earth are the
    most valuable citizens.'' No interest of this nation can be
    placed ahead of its agricultural sector.
        Yet this Republican-led Congress has shown complete disdain
    for our nation's primary industry.
        At this moment, economic chaos grips the nation's
    heartland. Farmers who should have already made crucial
    planting, cultivation, and marketing decisions are frozen in
    place by the fact that Congress has made no farm policy.
    Lenders who would otherwise provide the capital needed to
    finance this fall's crop are unable to make sufficient loans
    available.
        While the Congress and our Committee should have been
    devoting their time and resources to preparing for the
    expiration of the 1990 farm bill, virtually nothing has been
    done. In 1995, no bill to provide for agricultural policy in
    the years ahead was introduced until August. In a blatant and
    historic rejection of our sacred principles of open government,
    our Committee did not hold one single hearing on this
    proposal--and still has not to this day.
        Our Committee did vote on the August proposal. It was
    rejected by a bipartisan majority. In spite of its defeat by
    the Agriculture Committee, the bill--written to cut $13.4
    billion out of farm programs--was packaged with proposals to
    cut Medicare, Medicaid and education and to provide a tax cut.
        Inevitably and quite predictably, that bill--the one
    vehicle offered by the Republican Congress to establish a farm
    policy--was vetoed, not only because of its ill-advised cuts in
    farm programs but also because of the many other radical
    proposals which it contained.
        In a further act of disregard towards rural America, the
    Committee waited until the end of January to take further
    action. As the farmer's precious time dwindled away, our
    Committee did not meet. Again, no hearings were held, and even
    as the Republican leadership prepared to adjourn for a three-
    week vacation, the Committee waited until the very last hour to
    act.
        We are members of the Agriculture Committee. We regard
    ourselves as having the solemn responsibility to weigh and
    consider the problems and concerns relating to agricultural
    policy. Yet in setting its agenda, the Republican leadership
    has completely and utterly frustrated our ability to carry out
    that responsibility. Having had little opportunity to debate
    matters with our Committee colleagues, we have nonetheless
    identified substantial public concern over the approach taken
    in this bill.
        H.R. 2854 cuts agriculture too deeply. Agriculture is the
    very foundation of our nation's economy. Our basic farm
    programs have played a significant role in the farmer/
    government partnership that has been so successful in assuring
    that our nation has a safe, reliable, and affordable food
    supply. Reducing Federal spending on farm programs by $13
    billion will threaten the economic viability of American
    agriculture and thereby endanger our nation's food security.
        We know that these cuts were not conceived in the context
    of any consideration to good farm policy. Rather, the decision
    to cut the very heart out of farm programs was integral to the
    radical Republican policy of cutting $270 billion out of
    Medicare and providing for a $245 billion tax cut.
        All parties have rejected the unreasonableness of those
    earlier attacks on health care and responsible fiscal policy,
    and those proposals are no longer viable. Yet, the Republican-
    led House of Representatives continues to insist on a dramatic
    $13 billion reduction in farm programs. This in spite of the
    fact that the tax cut which those reductions were to pay for
    has been entirely abandoned.
        As bad as this bill is for the programs that support
    farming, it is even worse in its failure to address the need
    for investments in rural development, research, and
    conservation. Agriculture programs have been singled out for
    devastating reductions more than any other sector of the
    Federal budget. While the Republican leadership is demanding
    this pound of flesh, they are unwilling to devote the resources
    needed to allow rural America to adjust.
        As opponents of this legislation, we are not saying that
    agriculture should not contribute to deficit reduction (even
    though agriculture has provided a dramatically disproportionate
    share in past deficit reduction efforts). We are opposing this
    legislation because you cannot protect the interests of one
    segment of rural America at the expense of all others. Many
    needs exist in rural America today.

                                 Where We Stand

        We are committed to developing policy that meets the basic
    needs of farmers and other rural Americans: (1) preservation of
    a responsible safety net for farmers, (2) promotion of exports
    and maintenance of a vibrant rural economy, and (3) protection
    and enhancement of the rural environment.

                              The Farm Safety Net

        The fixed contract payments of H.R. 2854 will help those
    farmers who lost a crop last year and cannot benefit from
    current high prices. However, H.R. 2854 will also provide
    income transfers to farmers with bountiful harvests even though
    current prices are high and deny them additional assistance
    should market prices fall to below normal levels.
        The farm safety net is destroyed by this legislation for
    three reasons: (1) it ends income protection, (2) it ends price
    protection, and (3) it ends all farm programs after seven
    years. Advocates of this policy declare that farmers will now
    respond to market signals, not government inducements. Indeed
    they will. However, farmers will also have to respond to
    macroeconomic forces beyond agricultural markets.
        In the mid-1980's, a strong U.S. dollar weakened the
    competitive position of U.S. agricultural exports, and
    declining world economic growth dampened demand for all
    agricultural imports. Sharply lower market commodity prices
    resulted. Real interest rates rose, increasing farm borrowing
    costs and driving down farmland values that provided the
    security for farm lenders. Many farmers were unable to obtain
    operating credit, or produce crops to meet existing loan
    requirements, for reasons that had nothing to do with farm
    policy. The Agricultural Market Transition Act will be wholly
    inadequate to address such a situation. Farmers will have no
    income safety net.
        H.R. 2854 also caps commodity loan rates. Under current
    law, rising market prices would cause loan rates to increase,
    with certain provisions to protect against burdensome stocks
    and preserve competitive export pricing. Higher loan rates,
    resulting from rising prices, would afford farmers more price
    stability. The capped loan rates in this bill will destroy that
    price stability and, as a result, farmers will have no price
    safety net.
        In addition, with the repeal of permanent law, H.R. 2854
    makes no provision for agricultural policy after 2002. The
    Commission on 21st Century Production Agriculture may provide
    useful information and guidance to Congress, but it provides no
    guarantee that there will be any continuation of agricultural
    policy whatsoever; only permanent law can do that. This repeal
    is an unambiguous statement to farmers that assurance of public
    assistance to agriculture will end after 2002. Farmers will
    have no safety net at all.

                        H.R. 2854 and the Peanut Program

        H.R. 2854 embodies a schizophrenic policy. Under the guise
    of deregulation, the bill places more onerous work requirements
    on U.S. peanut growers that are coupled with huge losses in
    farm income. In fact, the Department of Agriculture estimates
    that H.R. 2854 will immediately result in a 30% to 40%
    reduction in American peanut producers' income. The immediate
    shock of these provisions will be devastating to many peanut-
    producing communities in the rural South.
        While we applaud many industry-supported provisions of the
    bill's peanut section which achieve a no-cost peanut program--
    e.g., eliminating the 1.35 million ton quota floor, eliminating
    under- marketings and reducing support levels for disaster
    transfers--other provisions of that section go beyond
    reasonable reform and, in fact, are ridiculously punitive to
    the American peanut grower. The purposefully punishing nature
    of the bill towards U.S. peanut growers is clearly highlighted
    by the fact that two Democratic alternatives also achieve a
    market-oriented and no-cost peanut program with less harmful
    and more reasonable contributions by peanut producers and
    resulted in even greater savings than in H.R. 2854.
        Beyond the core reforms in the bill that are necessary to
    achieve a no-cost peanut program, H.R. 2854 contains several
    serious flaws and, in particular, five provisions that are
    egregiously damaging to peanut farmers and the rural South:
        (1) Price Support. Under current law, U.S. peanut producers
    are allowed to place quota peanuts under loan at marketing
    associations for $678/ton or 34 cents per pound. On top of the
    20% cut in farmer income related to the elimination of the
    quota floor required by H.R. 2854, U.S. peanut producers also
    suffer an additional and immediate 10% cut in income because
    the Republican-backed reforms slash peanut loan rates to $610/
    ton.
        In testimony before the House Subcommittee on Risk
    Management and Specialty Crops, USDA testified that, on
    average, the nationwide cost of production for domestically
    produced peanuts is approximately $640/ton and that many farms,
    particularly small, family farms, face severe challenges even
    under the current $678/ton price support, primarily because
    profits from a farm's quota peanut ``base'' are often mixed
    with losses from the sale of additional peanuts that do not
    receive government support to create a small overall profit
    margin. A regional study by Auburn University indicates that
    the bill's provisions will result in more than 3,000 lost jobs
    in a contiguous, limited area of rural Georgia, Alabama and
    Florida; certainly additional job losses can be expected in
    other U.S. peanut production areas.
        (2) Offers From Handlers. While the majority insists on
    deregulation of agriculture--open to an unfettered market, H.R.
    2854 treats U.S. peanut producers differently by actually
    placing legislative limits on the price a U.S. peanut farmer
    receives for his or her peanuts. Not only does the bill slash
    the peanut loan rate, but it requires the U.S. peanut farmer to
    sell his or her crop if he or she is offered $610/ton or suffer
    a 5% penalty. There is no similar penalty for any other
    commodity in H.R. 2854. This peanut-specific provision is
    entirely contrary to the marketing loan concept.
        Even today, with peanuts loan rates set at $678/ton, market
    conditions often allow peanut farmers to sell peanuts above the
    USDA-supported loan rate. Setting the loan rate below the cost
    or production for many peanut farmers and then statutorily
    forcing peanut farmers to sell their labors at a loss is a
    recipe for disaster. This provision in no way makes the peanut
    program more market-oriented and, as with the issue of price
    support, this provision does not achieve any savings for the
    U.S. taxpayer. The provision is bizarre and hostile to U.S.
    peanut growers. It should be eliminated.
        (3) Losses. While we generally approve of the provisions in
    H.R. 2854 to ensure that any losses are fully covered by peanut
    program participants, we believe the process through which
    program losses are covered should be refined so that
    responsibility starts with the individual producer before
    affecting area and national pools. Also, we are gravely
    concerned that H.R. 2854 exempts certain parties from liability
    even though they use the marketing association pools to improve
    profits, often displacing quota peanuts in the process.
    Additional growers who use the redemption process should meet
    their responsibility. Similarly, peanut policy should recognize
    that shellers also benefit from the peanut program and should
    allow the entire peanut marketing assessment to be used, when
    necessary, to cover program losses. H.R. 2854, as currently
    drafted, invites abuse and could unfairly impact some program
    participants.
        (4) Certain Farms Ineligible. We question the wisdom of the
    policy that will strip certain individuals of peanut quota
    almost solely on the basis of where they live. This provision
    raises concerns about ``unequal treatment under law'' and may
    very well be unconstitutional. The implementation of this
    provision, as reported out of the Committee, will have a severe
    impact in rural communities. Many retired farmers or their
    widowed spouses rely on quota rent for economic subsistence.
    When one considers the severe cuts in Medicaid, Medicare and
    rural housing being advanced by majority deficit reduction
    proposals, some rural elderly will suffer a particularly nasty
    one-two punch. The combination of proposals will threaten the
    ability of many rural southern elderly to maintain economic
    independence.
        The one year ``grace period'' provided by the bill is not
    adequate time for a smooth transition. We believe that, at a
    minimum, all quota holders should be ``actively engaged'' in
    the production and marketing of their quota for two out of
    three years or risk forfeiture of their peanut quota. Such an
    approach provides for a smoother transition and provides for
    equal treatment under law.
        (5) Spring and Fall Transfers. The immediate implementation
    of 100% sale and lease of quota across county lines creates
    hardships very similar to the issues raised by the ``Certain
    Farms Ineligible'' provisions. At a minimum, the provision
    should be phased in over the life of H.R. 2854 and should be
    limited to 30% of a county's historical quota.

                        H.R. 2854 and the Sugar Program

        While we support many of the sugar program reforms
    contained in H.R. 2854, we take issue with two provisions that
    negatively impact U.S. sugar producers and are punitive in
    nature. On the positive side, these are grower-supported
    provisions to create a less regulatory sugar program, and H.R.
    2854 does provide a 7-year countercyclical farmer safety net
    for the U.S. sugar producers (a feature we believe to be
    essential for all U.S. producers). However, H.R. 2854 also
    permits and encourages the importation of ``dumped'' foreign
    sugar into the United States at a level that exceeds our GATT-
    WTO obligations. As with changes to the peanut program reforms,
    the bill's sugar program reforms place additional costs and
    hardships on U.S. sugar producers.
        (1) Nonrecourse Loans. We believe the trigger to establish
    nonrecourse loans should be set at the GATT required 1,256,000
    ton level and not at the excessively high 1,500,000 ton level.
    We contend that the world market is currently governed by
    protocols established under the recently completed Uruguay
    Round of GATT and the newly evolved WTO, and the Republican
    effort to key the nonrecourse loan trigger above the GATT-
    required import levels only serves to unilaterally punish U.S.
    sugar growers while encouraging increased imports from heavily,
    and directly, subsidized foreign sugar.
        (2) Forfeiture Penalty. We are opposed to this penalty.
    Forfeiture of sugar would only be plausible if a Secretary of
    Agriculture purposefully misused the import loopholes created
    by the provisions of H.R. 2854. It is patently unfair to punish
    victims of any USDA mismanagement of the sugar program. The
    measure seems purposefully punitive in nature.

                             Export Competitiveness

        H.R. 2854 hits American farmers below the belt when they
    seek to compete in world markets. When the governments of other
    countries are providing all allowable resources to assist their
    farmers in selling their crops internationally, our Congress is
    abandoning American farmers. Export Enhancement Program
    expenditures in H.R. 2854 are $1.58 billion below the U.S.
    subsidy value commitments under the Uruguay Round Agreement.
    This will greatly limit the ability of the Department of
    Agriculture to assist U.S. agricultural exports in years with
    high levels of accumulated stocks, within the allowable limits
    of the Uruguay Round Agreement.
        The Market Promotion Program maximum level of funding is
    reduced from the current level of $110 million to $100 million.
    This is the Department of Agriculture's major export assistance
    program for processed and high value agricultural products.
    Foreign marketers of these products received significantly
    greater support from their governments in export assistance and
    the reduction in this bill will further decrease U.S. marketing
    efforts, placing U.S. producers at a great disadvantage.

                               The Rural Economy

        The payments provided by this bill decline and end in 2002.
    Their meaning as transition payments will then become
    inescapable. Farmers who will no longer be able to continue
    operating for a variety of reasons will turn to the rural
    communities in which they live for other means of earning a
    livelihood. Agriculture accounts for less than 10 percent of
    rural employment, yet nearly 50 percent of farm household
    income derives from off-farm employment. As farm program
    spending declines and finally ends under H.R. 2854, many farm
    families will find local employment, leave rural communities to
    seek jobs elsewhere, or live in poverty as a burden on their
    local and state governments.
        We supported an amendment in Committee to address these
    needs. Our Republican colleagues voted in lock step against an
    amendment to provide $3.5 billion through a ``Fund for Rural
    America'' for rural development, research, and conservation.
    Even were this investment incorporated, H.R. 2854 would still
    reduce federal spending by over $9 billion. This fund would
    simply allow rural America to adjust to the changing conditions
    in government spending that exist today and that will be
    intensified with this and other deficit reduction legislation.
        Programs for business and industry, rural business
    enterprise, rural economic development, rural technology and
    cooperative development, and technical assistance and planning
    are the very assistance rural communities will need to deal
    with the ``transition'' forced by H.R. 2854. Other programs for
    community facilities and water and waste disposal are the
    specific elements local rural governments will require to
    respond to increasing demand on them as their tax base shrinks,
    employment declines and local consumer spending weakens.
        Opponents of this amendment were willing to deny 3.5
    billion additional dollars for rural development, for research,
    and for conservation at a time when they are reducing farm
    program payments by greater than 20%. There is no other sector
    of the budget that is taking this kind of devastating
    reduction. It is not hard to determine that these funds are
    desperately needed, even though they will address only some of
    the critical needs.
        For example, over $3.5 billion is needed to ensure delivery
    of safe drinking water to the remaining rural Americans
    currently living without water piped directly into their homes,
    and that amount would only take care of the over 1,600 rural
    areas with critical pressing water quality problems. Another
    $6.3 billion is needed over the next decade to meet worsening,
    but not yet critical, drinking water supply problems of over
    5.3 million people in over 3,100 rural areas. The water needs
    in rural America alone could eat up the funds authorized in
    this proposal. But there are many more needs.
        For example, the same holds true for research funding. The
    need is great. In fact, the National Research Initiative
    received more than 3,000 proposals last year, but funding only
    allowed for 783 to move forward. The demand for agriculture
    research far exceeds the available resources. The Department
    was only able to support 24% of the proposals submitted.
        The two examples do not even address the need that will
    exist in rural America to modernize in order to be included in
    the new information technology transfer system--the future of
    not only agriculture, but all of rural America. Without the
    support they need to adjust to the massive cuts they are
    receiving, rural Americans will be left behind once again.

                                  Conservation

        We are distressed with the Majority's refusal to provide
    the Secretary of Agriculture with the authority to make new
    enrollments in the Conservation Reserve Program in order to
    keep the program viable. We are gambling with the fate of this
    program by not providing the authority for new enrollments, and
    we risk the ability of farmers and rural citizens receiving
    federal assistance to address environmentally sensitive lands
    and water resources.
        We are also troubled about the levels of animals that the
    bill has in place for the definition of ``Confined Animal
    Feeding Operation'' in the Livestock Environmental Assistance
    Program (LEAP). It appears that an arbitrary action was taken
    to the detriment of some sectors of the livestock industry. The
    number of animals that constitute a ``CAFO'' in regulations
    differs greatly in several categories, namely the lowered
    number of dairy cattle and the inflated numbers of cattle and
    swine included in the LEAP provisions. It is our hope that this
    issue will be addressed as the bill proceeds through the House.
        Additionally, we have concerns about the prohibitions on
    permanent easements and 30-year easements in the Wetlands
    Reserve Program. H.R. 2854 would eliminate permanent and 30-
    year easements from the WRP and replace them with 15-year
    easements. Eliminating permanent and 30-year easements will
    limit the ability of landowners to choose the option that would
    best serve their needs. While we believe there is a need for
    long-term easements, we think the best policy is to provide a
    variety of easement and cost-share options and leave that
    determination up to the landowner.

                                   Conclusion

        For these many reasons, we oppose H.R. 2854. The flawed
    process used in its development has led to a devastatingly
    misguided product. We believe that it is not too late to devise
    a good farm policy. If our colleagues on the Committee have the
    will, we can work together and design an approach that
    safeguards the rural economy; that preserves a safety net
    adequate to insure our nation's food security; and that makes
    the government a helpful partner to the American farm producer
    who is increasingly exposed to international competition.
        Finally, we stress that time is of the essence and urge our
    colleagues to act swiftly and work with us to enact farm policy
    that addresses the goals we have expressed.

                                       Charlie Stenholm.
                                       Harold L. Volkmer.
                                       John E. Baldacci.
                                       Cythinia McKinney.
                                       Tim Johnson.
                                       Earl F. Hilliard.
                                       Scotty Baesler.
                                       Karen L. Thurman.
                                       Ed Pastor.
                                       Kika de la Garza.
                                       George E. Brown, Jr.
                                       Earl Pomeroy.
                                       Bennie G. Thompson.
                                       Tim Holden.
                                       Eva M. Clayton.
                                       Sam Farr.
                                       Charlie Rose.
                           ADDITIONAL MINORITY VIEWS

        I am strongly opposed to H.R. 2854, ``emergency farm
    legislation'' as passed by the Agriculture Committee because it
    is bad farm policy which, if allowed to run its 7 year course,
    will adversely affect farmers, ranchers, their sons and
    daughters, small rural communities, the rural environment, and
    agriculture related businesses and farm-workers who are
    dependent on a vibrant and healthy rural economy for their
    livelihood.
        H.R. 2854, code named ``emergency farm legislation'' is
    nothing more than a $13 billion cut in farmers income to be
    used for a tax break for the wealthiest people in America, and
    for others who do not live on the farm, near a farm, or in
    Rural America.
        In their quest to obtain a tax break for the wealthiest
    people in America the majority on the Agriculture Committee
    along with the Speaker and the Chairman of the Budget Committee
    have employed the adage ``there may be another way to skin this
    cat'' by resurrecting the vetoed Freedom to Farm Act and
    attempting to pass it as stand alone ``emergency farm
    legislation''. They are hopeful that Congress will pass this
    bad farm legislation so that no one will blame Republicans for
    failing to enact farm policy for farmers and ranchers for over
    a year since they came to power in January of 1995.
        However, they are attempting to ``skin the same cat twice''
    and that is not possible and it won't occur. The sham of
    presenting Freedom to Farm as ``emergency farm legislation'' is
    revealed by Secretary Glickman in a January 30, 1996 letter to
    Chairman Roberts, when he states ``H.R. 2854 contains
    essentially the same provisions, with minor revisions, as the
    Agricultural Reconciliation Act of 1995, which I recommended
    that President Clinton veto.''
        The majority has been in power for over one year. They
    failed to enact major necessary farm legislation, even though
    they were on notice that some farm programs expired on December
    31, 1995 and required reauthorization to avoid reverting to
    earlier more costly permanent farm legislation.
        This legislation is really Freedom ``NOT'' to Farm for many
    farmers. In reality it is a welfare program for big
    corporations and large farm owners. Some farmers would receive
    payments of $80,000 whether they made $150,000 or $200,000 on
    their farm operation as many will do this year. They are not
    required to farm. They will still receive their welfare
    payment. These excessive welfare payments will not only go to
    large individuals and major corporations in time of need but
    also at times when they don't need it at all. This is nothing
    more than a welfare program for large farmers and corporations.
        Most farmers don't want to be on welfare. The majority of
    my farmers really want their income from the marketplace
    prices,--not from a government check. But when prices are
    depressed from world markets and from heavily subsidized grains
    from other countries then they are willing to accept fair
    payments so they can continue to operate in competition with
    other heavily subsidized farmers from other areas of the world.
    I want to emphasize farmers want a safety net not a welfare
    program.
        Rather than taking the advice of the Secretary and others
    with constructive amendments on this committee to make changes
    in Freedom to Farm and improve its chance of passage and
    becoming law the majority has insisted on offering up the same
    legislation for a second veto.
        In addition to H.R. 2854 being bad for agriculture and
    deserving of a veto, the process is flawed.
        Originally, in September of 1995 this ``emergency farm
    legislation'' came before the Agriculture Committee as
    ``Freedom to Farm'' and was surrounded by controversy over its
    radical policy to end farm programs in 7 years and at the same
    time reduce funding for agriculture programs by $13 billion.
    The legislation was so controversial that it could not obtain a
    majority of support of the members of the committee and it was
    not reported. However, the Chairman of the Agriculture
    Committee had ``Freedom to Farm'' legislative language included
    as part of the Budget Reconciliation bill. All the maneuvering-
    in spite of the fact that Freedom to Farm had not passed or
    been reported from the Agriculture Committee.
        Eventually, this radical proposal to cut farm income by $13
    billion, along with billions of dollars of cuts in Medicare,
    Medicaid, education, and the environment, as well as a $245
    billion tax break for the rich--all embodied in the Budget
    Reconciliation bill of 1995--was vetoed.
        The flawed process continued on January 5, 1996 when
    Freedom to Farm was reintroduced as a free-standing bill H.R.
    2854. A business meeting was scheduled for January 30, 1995.
    Again, hearings were not held on H.R. 2854, just as hearings
    were not held on the Freedom to Farm Act.
        At the January 30, 1996 business meeting the Agriculture
    Committee reported H.R. 2854 and the Ranking Republican member
    asked for unanimous consent that the three (3) day layover
    period to file minority and supplemental views be waived. I
    objected to the waiver. I objected in order to protect the
    rights of the minority to file minority views on this
    controversial legislation and the process by which the
    Republicans are attempting to bring it to the floor.
        In seeking to fulfill this pledge of a tax cut for the
    richest corporations and individuals in America, the
    Republicans have turned their back on past bi-partisan farm
    policy and program development whereby Democrats and
    Republicans have combined their efforts to help make Americans
    the best fed people in the world, where consumers spend less of
    their paycheck on food than do consumers in any other country
    of the world. At the same time, in the past, American farmers
    have been assured a safety-net of income and price-support
    programs to insure that farmers and ranchers have the ability
    to compete in the domestic and international marketplace with a
    minimum of government interference. All that is gone under
    Freedom to Farm emergency farm legislation and in that place we
    are legislating a highly partisan, leadership inspired and
    directed policy and program which will force small and medium
    sized farmers out of business. Volatility in supply and price
    will return and the stability of our agriculture community and
    food supply will be jeopardized.
        I object to the automatic writing of checks to the
    wealthiest farmers and richest corporations in America (and
    maybe some foreign owned corporations) regardless of need; I
    object to the decision to end the farm programs in 7 years
    through a series of declining payments which do not reflect
    supplies and prices in the market place and which will result
    in bankruptcy proceedings and drive many small and medium farm
    operators out of business and off the farm; I object to turning
    good farmers into welfare recipients.
        The Democrats on the Agriculture Committee offered
    amendments to correct many deficiencies, however, the
    majority's intransigence to seriously consider amendments makes
    it imperative that the rule to consider this legislation be
    open so that the full House of Representatives has an
    opportunity to offer corrective language to a bill that will do
    irreparable harm to the agricultural community. Many of these
    concerns can be addressed on the floor of the House.
        If this bill's provisions that give welfare checks of up to
    $80,000 to corporate farmers who don't need it is not corrected
    I will have no alternative but to vote against it. It is not
    good for our hard working farmers or for the rural areas in
    which they live.
        We, in Congress, are empowered with the responsibility to
    provide the guidepath for agriculture in the future. This bill
    provides a dead end road that will harm farmers, small
    communities and agri-businessmen. Seven years of welfare and
    then nothing. Payment for nothing. Is this a responsible
    guidepath? No, it is a dead end road.

                                       Harold L. Volkmer.
                                DISSENTING VIEWS

        I have served for over 23 years as a member of the House
    Committee on Agriculture. This Committee has usually operated
    in an open, bipartisan manner. In the past, Members of the
    Agriculture Committee had an opportunity to fully consider and
    understand the legislation they were voting for and were
    afforded an opportunity to hear from their constituents and
    those directly affected by the legislation through the hearing
    process. This has not been the case for H.R. 2854.
        The Committee on Agriculture has been converted to a
    rubber-stamp for legislation developed outside of the public
    forums utilized in past Congresses. Legislation developed with
    the participation of members of both parties is bipartisan.
    Legislation developed by one party and presented for
    endorsement by the other is not, regardless of who votes on
    passage. In the past, we have been able to reconcile
    philosophical differences and differing regional perspectives
    through compromise. That is the democratic process. It was not
    the process under which H.R. 2854 was considered by this
    Committee.
        Although this package contains some reforms and provisions
    that I would have supported and have supported in the past, I
    regret that I could not support this bill. For months, the
    Committee has been largely inactive. There have been few
    hearings or markups in subcommittee or full committee where
    these proposals could have received more thoughtful debate and
    scrutiny by both Republican and Democratic members. Instead, I
    was asked to support a bill which authorized over $35 billion
    over a 7-year period which I had no opportunity to examine
    until a few days prior to consideration.
        These arguments may seem too philosophical to some. But, if
    we do not develop and consider legislation in an open,
    democratic process I believe we are doing a great disservice to
    the people we serve. The Committees of the House are supposed
    to play an important role in the development and consideration
    of legislation. Constituents expect us to know what we are
    voting for, especially when we are spending their hard-earned
    tax dollars. In the case of H.R. 2854, we were not permitted
    the time to give this legislation the consideration that an
    expenditure of billions of dollars deserved. We owe it to our
    constituents to take the time to move through the legislative
    process in a more deliberate and bipartisan fashion to craft a
    thoughtful farm policy that will serve all the people who
    depend upon our agricultural sector.

                                       George E. Brown, Jr.
                          SUPPLEMENTAL MINORITY VIEWS

        I join with my colleagues' criticisms, expressed in the
    minority views, of H.R. 2854 and the process by which it was
    moved through the Committee. I am submitting these additional
    views only to emphasize the problems with the bill that I feel
    most strongly about.
        The farmers of the California Central Coast region that I
    represent practice the most intense and productive speciality
    crop agriculture in the world. They produce over $2.5 billion
    worth of fresh fruits, vegetables, and horticultural crops
    without any federal price supports or other direct federal
    support. They have succeeded by embracing the full benefits,
    and potential risks, of the market.
        I believe that they represent the model for the future
    progress of American agriculture as it moves into the next
    century and into a market place dominated by global
    competition. I believe that American agriculture must move in
    this direction to remain a viable business and give farmers a
    greater hand in their own future. I do not believe, however,
    that this Central Coast model means that national farm policy
    has no value to the agricultural economy of my region or the
    future of rural American. On the contrary, research,
    conservation, export promotion, rural development,
    infrastructure, and credit enhancement programs are all crucial
    to future success and sustainability of market driven
    agriculture--and the federal government has a deep
    responsibility to make sure that these programs help all of
    rural America.
        The deepest flaw of H.R. 2854 is that it ignores these
    crucial, and I believe, most important, aspects of agricultural
    policy. The Committee, and House leadership, are squandering a
    tremendous opportunity. As Congress moves forward to reform
    agricultural policy, we look to build a foundation for
    agriculture's future success and not just fix the problems of
    the past.
        I am particularly concerned that it does not address the
    loss of farmland to urban sprawl. During the Committee's
    consideration of H.R. 2854 I raised, and then withdrew, an
    amendment that is based on legislation, H.R. 2429, that I have
    developed with Representative Wayne Gilchrest to help the
    states address the troubling loss of farmland to urbanization--
    over 1,000,000 acres a year at current rates. The states have
    taken the lead in helping farmers keep this land in agriculture
    and out of the grasp of urban development and the federal
    government should help the states with their efforts. I am glad
    that the Committee expressed a willingness to work with me on
    this issue in the future. However, I see no reason why this
    issue should not be addressed in H.R. 2854.
        Moreover, the development of agriculture policy must regain
    its bipartisan character if there is to be any hope of moving
    farm legislation forward this year. As our country becomes ever
    increasingly suburbanized, agriculture will become an ever
    increasing abstraction for most Americans. Food will continue
    to appear on supermarket shelves, but fewer and fewer people
    will have a direct connection or understanding of the farmers,
    ranchers, and rural economies, and rural environments that
    produce that food. In the coming century, it will only become
    more difficult to build broad national support for agricultural
    policy. There has never been a worse time to break apart the
    bipartisan coalition that has traditionally supported
    agriculture as has occurred during the consideration of H.R.
    2854.
        I believe that good farm policy can yet be salvaged out of
    the mess that this Congress created. I look forward to working
    with all of my colleagues on this difficult and vitally
    important task.

                                       Sam Farr.