[Senate Report 106-391]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 767
106th Congress                                                   Report
                                 SENATE
 2d Session                                                     106-391

======================================================================



 
         GRAIN STANDARDS AND WAREHOUSE IMPROVEMENT ACT OF 2000

                                _______
                                

                August 25, 2000.--Ordered to be printed

   Filed under authority of the Order of the Senate on July 26, 2000

                                _______
                                

Mr. Lugar, from the Committee on Agriculture, Nutrition, and Forestry, 
                        submitted the following

                              R E P O R T

    The Committee on Agriculture, Nutrition, and Forestry, 
having considered an original bill to amend the United States 
Grain Standards Act to extend the authority of the Secretary of 
Agriculture to collect fees, extend the authorization of 
appropriations, and to improve the administration of that Act, 
to amend the United States Warehouse Act to authorize the 
issuance of electronic receipts, and for other purposes, 
reports favorably thereon and recommends that the bill do pass.

                                CONTENTS

                                                                   Page
  I. Purpose, need and background.....................................1
 II. Section-by-section analysis......................................4
III. Legislative history and votes in committee......................10
 IV. Regulatory impact statement.....................................11
  V. Budgetary impact of the bill....................................11
 VI. Changes in existing law.........................................15

                    I. Purpose, Need and Background

    The United States Grain Standards Act was enacted in 1916 
as a means of eliminating confusion resulting from the use of 
many different sets of grain standards applied by different 
grain inspection organizations operating without national 
coordination and supervision. Operating within the United 
States Department of Agriculture (USDA), the Grain Inspection 
Packers and Stockyards Administration (GIPSA) sets and 
administers official grain standards and conducts grain 
inspection services.
    The Act authorizes GIPSA to establish standards of ``kind, 
class, quality and condition for corn, wheat, rye, oats, 
barley, flax seed, sorghum, soybeans, mixed grain and such 
other grains as in the administrator's judgment the usages of 
the trade may warrant and permit.'' The GIPSA Administrator is 
authorized to develop standards or procedures for accurate 
weighing and weight certification and controls for grain 
shipped in interstate or foreign commerce. The Act also 
establishes certain performance requirements for grain 
inspection and weighing equipment. The certainty of these 
standards and the credibility and integrity of the inspection 
system has allowed our domestic and international markets to 
flourish as a result.
    The credibility and integrity of United States grain 
inspection must be maintained to allow U.S. producers to 
continue to supply the world through our marketing system. This 
bill will reauthorize the collection of fees, the Grain 
Inspection Advisory Committee, and funding until September 30, 
2005.
    In order to keep up with advances in technology, GIPSA 
needs flexibility in the way that commodity samples can be 
obtained. Grain marketing patterns, quality attributes, and 
quality testing methods are changing rapidly. New quality 
traits developed through biotechnology have increased the speed 
of change. This bill will provide flexibility needed by GIPSA 
to continue to maintain an efficient sampling system.
    In general, under current law, only one official federal 
inspection agency can operate within geographic boundaries. The 
1993 amendments to the Grain Standards Act provided for a pilot 
program that allowed for more than one official inspection 
agency within a single geographic area at interior locations. 
These programs were successful in facilitating the marketing of 
grain without jeopardizing the integrity of the system. This 
bill will permanently authorize this policy.
    The Warehouse Act was originally enacted in 1916, and was 
subsequently amended in 1919, 1923, and 1931. However, since 
that time, the authorizing legislation for this program has 
seen little change. At the same time, U.S. agriculture and our 
society have seen drastic changes since the early part of the 
20th century.
    The U.S. Warehouse Act does not mandate participation by 
warehouse operators that it regulates; it simply offers those 
who apply and qualify for licenses an alternative to state 
regulation. Currently, warehouse licenses may be issued for the 
storage of cotton, grain, tobacco, wool, dry beans, nuts, syrup 
and cottonseed. According to the U.S. Department of 
Agriculture, 45.5 percent of the U.S. off-farm grain and rice 
storage capacity and 49.5 percent of the total cotton storage 
capacity is licensed under the Warehouse Act. In general, the 
paper warehouse receipts that are issued under the Warehouse 
Act are documents of title and represent ownership of the 
stored commodity.
    This bill will make this program more relevant to today's 
agricultural marketing system. The legislation would authorize 
and standardize electronic documents and allow their transfer 
from buyer to seller across state and international boundaries. 
This new paperless flow ofagricultural commodities from farm 
gate to end-user would provide significant savings and efficiencies for 
farmers across the nation.
    In 1992, the Congress directed the Secretary of Agriculture 
to establish electronic warehouse receipts for only the cotton 
industry. Since that time participation in the electronic-based 
program has grown to over half of the U.S. cotton crop. In 
1996, for example, nearly 12 million bales of cotton, out of 
the total crop of approximately 19 million bales, were 
represented by electronic warehouse receipts. Recently, the 
cotton industry estimated that this electronic system saves 
them $5 to $15 per bale, a savings of over $275 million per 
year. The legislation extends this electronic warehouse receipt 
program to all agricultural commodities covered by the U.S. 
Warehouse Act. This reduced paperwork, increased efficiency, 
and substantial time savings will make U.S. agriculture more 
competitive in world markets. This Act will help GIPSA continue 
these high standards and increase the economic efficiency of 
the U.S. grain marketing system.
    The Committee believes that the U.S. government should 
focus on establishing rules and regulations under which private 
operators of electronic document systems can compete. This 
legislation envisions the federal government acting as an 
umpire over multiple private electronic document systems. This 
is the type of system currently in place for electronic cotton 
warehouse receipts and it has proven to work in that area.
    In addition to numerous advantages, electronic warehouse 
receipts present particular challenges with respect to the 
integrity and security of documents and transactions. 
Accordingly, the Committee expects the Secretary to evaluate 
carefully any forms of fraud or misuse that may potentially be 
associated with electronic warehouse receipts and to ensure 
that the Department's regulations governing electronic 
warehouse receipts require adequate protection against fraud or 
misuse.
    The Committee recognizes that the structure of the world 
grain market is changing rapidly and the U.S. grain marketing 
system will have to change in response to it. An increasing 
share of the grain and oilseeds that will be produced by 
American farmers in the coming years will incorporate unique 
characteristics whose value would not be fully realized if 
those crops are sold into an undifferentiated commodity market. 
A number of alternative outlets for selling differentiated 
products into both domestic and international markets currently 
exist, but not all of them may be equally accessible to all 
producers in all regions of the country.
    Certification of testing laboratories and validation of 
testing methods will be an important component of 
differentiating types of specialized grain. The Committee 
supports the efforts in this area that the Department has 
already undertaken. However, as the grain industry continues to 
refine its capacity to deliver grain on an identity preserved 
basis, the Department must continue to strive to give 
confidence to buyers and sellers involved in these 
transactions, thus enhancing opportunities for producers to 
capture a larger portion of the retail dollar.
    With demand for identity preservation increasing, the 
Committee requests the Secretary to conduct a study on the 
availability of grain-handling facilities (on-farm and off-
farm) capable of storing and moving grains and oilseeds on an 
identity-preserved basis, both nationally and regionally, and 
the capacity to maintain that identity throughout the marketing 
channel.

                    II. Section-by-Section Analysis


Section 1. Short title and table of contents

                        TITLE I. GRAIN STANDARDS


Section 101. Sampling for export grain

    This section provides GIPSA with more flexibility in 
obtaining samples of export grain. Currently, samples of export 
grain can only be obtained after final elevation of the grain. 
Historically, this has been a requirement due to the breakage 
that can occur as the grain goes through an export elevator. In 
many cases, this sampling procedure is still appropriate. 
However, for value enhanced traits (e.g. protein) that are not 
affected by handling, sampling and testing prior to final 
elevation may be more appropriate. Often it is not a simple 
process to perform these tests in a field environment. Grain 
marketing patterns, quality attributes, and quality testing 
methods are changing rapidly. These changes are being expedited 
by quality traits developed through biotechnology and new 
testing methods. In response to these breakthroughs, new grain 
marketing programs are evolving that require measurement of 
additional, more complex, quality attributes. Also, in order to 
maintain an efficient and effective marketing system in the 
United States, grain merchants are relying more on identity-
preserved programs to assure acceptable quality with limited 
testing. These merchants may need quality results on identity-
preserved grain prior to final elevation. Flexibility in 
obtaining samples would not jeopardize the representativeness 
of the samples obtained for inspection.

Section 102. Geographic boundaries for official agencies

    This section allows, under certain conditions, more than 
one official agency to perform inspection and weighing services 
within a single geographic area at interior locations. The 1993 
amendments provided for pilot programs to test such a change. 
These programs were successful in that they facilitated the 
marketing of grain without jeopardizing integrity of the 
system. This section will give the Secretary the authority to 
develop criteria similar to the current pilot programs.

Section 103. Authorization to collect fees

    This section extends, through the fiscal year 2005, the 
authority of the Secretary to charge user fees assessed for 
inspection supervision and to invest sums collected.

Section 104. Testing of equipment

    This section eliminates the requirement for mandatory 
annual testing for all equipment used in sampling, grading, 
inspection, and weighing. Annual testing is not necessary or 
appropriate for all such equipment.

Section 105. Limitation on administrative and supervisory costs

    This section provides that the administrative and 
supervisory costs for services, performed through fiscal year 
2005, would remain subject to a ceiling of 30 percent of total 
costs for such services (excluding the costs of 
standardization, compliance, and foreign monitoring 
activities).

Section 106. Licenses and authorizations

    This section allows GIPSA to contract inspection and 
weighing functions.

Section 107. Grain additives

    This section prohibits disguising the quality of grain as a 
result of the introduction of nongrain substances and other 
identified grains. The prohibition would include the 
introduction of nongrain substances such as cinnamon, vanilla, 
and bleach, and could apply to all grain whether officially 
inspected or not. This prohibition will enhance the integrity 
of the national grain marketing system.

Section 108. Authorization of appropriations

    The section extends, through fiscal year 2005, the 
authorization for appropriations to cover standardization, 
compliance, foreign monitoring activities and any other 
expenses necessary to carry out the provisions of the Act which 
are not obtained from fees and sales of samples.

Section 109. Advisory committee

    This section maintains an advisory committee through fiscal 
year 2005. This committee represents the industry and advises 
the Secretary in administering the Act.

Section 110. Conforming amendments

    This section makes necessary conforming amendments

                          TITLE II. WAREHOUSES


Section 201. Storage of agricultural products in warehouses

    This section amends the U.S. Warehouse Act as follows:

Section 1. Short title

    This Act may be cited as the ``United States Warehouse 
Act.''

Section 2. Definitions

    This section defines terms used in bill.

Section 3. Powers of Secretary

    Subsection (a). This subsection gives the Secretary 
authority over:
    Federally licensed warehouse operators, persons approved by 
the Secretary to engage in certain activities (i.e., a state 
licensed warehouse operator that has opted to participate in 
Federal electronic warehouse receipts), and a person claiming 
an interest in commodity stored in a warehouse by means of an 
electronic warehouse receipt.
    Subsection (b). This subsection authorizes the Secretary to 
specify what commodities may be stored in Federally licensed 
warehouses.
    Subsections (c) and (d). These subsections authorize the 
Secretary to conduct investigations and inspections of any 
person or warehouse licensed under this Act.
    Subsection (e). This subsection authorizes the Secretary to 
determine the suitability of a warehouse for storage of 
commodities.
    Subsection (f). This subsection authorizes the Secretary to 
classify warehouses according to their geographical location 
and their functions.
    Subsection (g). This subsection authorizes the Secretary to 
prescribe the duties of a warehouse operator relative to the 
commodities stored or handled in the warehouse.
    Subsection (h). This subsection authorizes the Secretary to 
establish 1 or more systems for the filing, storage, and 
conveyance of warehouse receipts.
    Subsection (i). This subsection authorizes the Secretary to 
conduct examinations and audits of warehouses.
    Subsection (j). This subsection authorizes the Secretary to 
issue a Federal warehouse license if the Secretary determines 
that the warehouse is suitable for the proposed activities and 
commodities and the warehouse operator agrees to comply with 
the requirements of the Secretary.
    Subsection (k). This subsection authorizes the Secretary to 
grant a license to a person to inspect, sample, classify, or 
weigh a commodity.
    Subsection (l). This subsection authorizes the Secretary to 
examine the papers and accounts of a warehouse operator.
    Subsection (m). This subsection authorizes the Secretary to 
enter into cooperative agreements with States to perform 
various activities related to warehouses.

Section 4. Imposition and collection of fees

    This subsection authorizes the Secretary to assess and 
collect fees from Federally licensed warehouse operators.
    The fees authorized in this section are intended to offset 
the cost of administering this Act. The Committee believes that 
such fees should be as low as possible and that there should be 
a direct correlation between the amount of the fee and the cost 
(to USDA) of performing a regulatory function under this Act. 
For example, fees should not be so large that they hinder the 
use of electronic warehouse receipts or other electronic 
documents. The Committee is unsure about the effect that a per 
transaction fee might have on the economic benefits and 
efficiencies of electronic receipts, and expects USDA to 
consult with the House and Senate Agriculture Committees prior 
to implementing a per transaction fee for the storage or 
handling of any agricultural product.

Section 5. Quality and value standards

    This section authorizes the Secretary to determine 
standards to establish the value and quality of commodities 
stored or handled in warehouses.

Section 6. Bonding and other financial assurance requirements

    This section authorizes the Secretary to require Federally 
licensed warehouse operators to provide bonds or other 
financial assurances to secure their performance.

Section 7. Maintenance of records

    This section requires warehouse operators and other persons 
authorized under this Act to maintain records as required by 
the Secretary.

Section 8. Fair treatment in storage of agricultural products

    This section requires a warehouse operator to act in a fair 
and business-like manner and consistent with the ordinary and 
usual course of business practices in the area.

Section 9. Commingling of agricultural products

    This section allows for the commingling of agricultural 
products (except cotton).

Section 10. Transfer of stored agricultural products

    This section allows a warehouse operator to transfer stored 
or handled commodities to another warehouse for storage, 
although the warehouse operator is still liable for producing 
an equivalent amount of the stored commodity at the request of 
the holder of the warehouse receipt.

Section 11. Issuance of receipts and other documents

    Subsections (a)-(d). These subsections authorize the 
issuance of warehouse receipts for commodities stored in a 
warehouse.
    Subsection (e). Electronic Warehouse Receipts.
    Paragraph (1). This paragraph authorizes the Secretary to 
establish a system of electronic warehouse receipts for 
commodities (except cotton, which has its own system for 
electronic warehouse receipts in subsection (f)).
    Paragraph (2). This paragraph authorizes the Secretary to 
establish 1 or more systems for the filing, storage, and 
conveyance of electronic warehouse receipts.
    Paragraph (3). The person to whom an electronic receipt is 
issued is considered to be in possession of the receipt.
    Paragraph (4). Security Interests.
    (A) Perfection of Interest. A security interest, whether 
established under State or Federal law, in grain represented by 
an electronic receipt may be perfected only through procedures 
established by the Secretary.
    (B) Effect of Recordation. A security interest in a stored 
commodity is established through recordation of the security 
interest in a manner as prescribed by the Secretary.
    (C) Priority. The priority of multiple security interests 
in stored commodity is determined by the applicable Federal or 
State law.
    (D) Encumbrances.
    (i) In the case of a warehouse operator licensed under 
State law that is participating in the Federal electronic 
warehouse receipt program, a security interest, lien, or other 
encumbrance can be recorded only if it is authorized under 
State law and recorded in a manner as prescribed by the 
Secretary.
    (ii) In the case of a warehouse operator licensed under 
Federal law, or that is not licensed at all (e.g., a warehouse 
operator in California), a security interest, lien, or other 
encumbrance can be recorded only in a manner as prescribed by 
the Secretary.
    Paragraph (5). A person taking possession of a stored 
commodity is subject only to security interests that have been 
recorded in a manner as prescribed by the Secretary for 
electronic warehouse receipts.
    Paragraph (6). An electronic receipt shall be accepted in 
all commerce. A warehouse operator is not required to issue an 
electronic receipt.
    Paragraph (7). An electronic receipt has the same legal 
effect as a paper receipt.
    Paragraph (8). A State licensed warehouse operator may opt 
in or out of the Federal electronic receipt program.
    Paragraph (9). This paragraph restates that a State 
licensed warehouse operator may opt out of the Federal 
electronic receipt program.
    Subsection (f) (only applicable to cotton, restates current 
law for cotton electronic warehouse receipts). This subsection 
is essentially the same as for the previous subsection, except 
that for cotton, state licensed warehouses must participate in 
the Federal electronic warehouse receipts program.
    Paragraph (1). This paragraph authorizes the Secretary to 
establish 1 or more central filing systems for the filing, 
storage, and conveyance of electronic warehouse receipts. If a 
warehouse operator lacks the facilities to participate, 
participation in electronic receipts is not required.
    Paragraph (2). A security interest in a stored commodity is 
established through recordation of the security interest in a 
manner as prescribed by the Secretary. Also, this paragraph 
establishes which person has a posessory interest in the 
commodity. The person designated on the receipt is considered 
to be in possession of the receipt. The priority of multiple 
security interests in a stored commodity is determined by the 
applicable Federal or State law. This subsection is applicable 
to cotton electronic warehouse receipts covering cotton stored 
in a cotton warehouse, regardless of whether the warehouse 
storing the cotton is participating in the Federal program.
    Paragraph (3). A cotton warehouse operator, upon demand, 
shall produce the cotton covered by the electronic receipt, if 
payment is provided at the time of the demand.

Section 12. Conditions for delivery of agricultural products

    A warehouse operator shall deliver the stored commodity to 
the holder of the electronic receipt upon demand for the 
delivery of the commodity. Payment can be requested at the time 
of delivery. The electronic receipt is to be canceled when the 
commodity is properly delivered.

Section 13. Suspension or revocation of licences

    Subsequent to proper notice and an opportunity for a 
hearing, a license can be suspended or revoked.

Section 14. Public information

    Information collected by the Secretary is confidential, 
except that the name of a warehouse operator whose license has 
been suspended or revoked may be provided to the public.

Section 15. Penalties for noncompliance

    A monetary penalty of $25,000 or up to 100% of the value of 
the agricultural product involved may be assessed for 
noncompliance with the regulations of the Secretary.

Section 16. Jurisdiction and arbitration

    This section provides that district courts of the United 
States shall have exclusive jurisdiction over actions brought 
under this Act.

Section 17. Regulations

    This section requires the Secretary to promulgate 
regulations.

Section 18. Authorization of appropriations

    This section authorizes appropriations.

                        TITLE III. MISCELLANEOUS


Section 301. Energy generation, transmission and distribution 
        facilities efficiency grants in rural communities with 
        extremely high energy costs

    This section authorizes the Secretary to make grants and 
loans to improve the efficiency of energy distribution in areas 
where the cost of home energy is at least 275 percent of the 
national average.

Section 302. Carry forward adjustment

    This provision amends tobacco language included in the 
Agricultural Risk Protection Act that was signed by the 
President on June 20, 2000. It establishes a limitation on the 
amount of under marketings (marketing less tobacco than is 
allowed by the assigned quota) of burley tobacco that can be 
applied toward the calculation of quota size in the subsequent 
year.

Section 303. Fees for mediation and arbitration of disputes involving 
        fruits and vegetables moving in foreign commerce under 
        multinational entities

    This section authorizes USDA to receive fees from customers 
that contract with it to provide arbitration services for 
disputes involving the shipment of fruits and vegetables across 
national boundaries.

Section 304. Community facilities grant program for rural communities 
        with extreme unemployment and severe economic depression

    This section authorizes the Secretary to make grants to 
provide for the federal share of essential community facilities 
in rural communities in which the employment rate is extremely 
high based on Bureau of Labor Statistics information.

Section 305. Eligibility for business and industry loans

    This section provides an exception so that guaranteed 
business and industry loans can bemade to finance projects (but 
not new construction) in a town with a population in excess of 50,000 
if the project is for the processing of agricultural commodities and 
the primary economic beneficiaries of the project are agricultural 
producers.

Section 306. State agricultural loan mediation programs

    This section reauthorizes the State loan mediation program 
through 2005.

Section 305. Adjustments to nutrition programs

    This section contains two technical amendments to the WIC 
law. The first would clarify that Alaska is eligible to 
exercise the state option to exclude cost-of-living adjustments 
for military personnel in high cost areas outside the 
continental US. The second amendment would simplify a WIC pilot 
project by allowing fewer WIC agencies to participate in the 
project, if they so choose. This section also fixes a section 
heading in the School Lunch Act and removes an extra ``and'' 
found in the statute.

              III. Legislative History and Committee Vote


                          LEGISLATIVE HISTORY

    The Senate Agriculture, Nutrition, and Forestry Committee 
held a full committee hearing on Thursday, February 1, 2000. 
The purpose of this hearing was to address oversight issues of 
the Grain Inspection, Packers and Stockyards Administration 
(GIPSA).
    Administration testimony was provided by Mr. Michael Dunn, 
Under Secretary for Marketing and Regulatory Programs and Mr. 
James Baker, GIPSA Administrator. They were accompanied by Mr. 
David Shipman, Deputy Administrator of the Federal Grain 
Inspection Program. The following panel discussed the current 
authorities of GIPSA and reauthorization of the Grain Standards 
Act: Mr. Bert Farrish, President, Columbia Grain representing 
the North American Export Grain Association, Portland, Oregon; 
Mr. Robert Smigelski, The Anderson, Incorporated, representing 
the National Grain and Feed Association, Maumee, Ohio; Mr. Mike 
Clark, National Corn Growers Association, also represented the 
concerns of the American Soybean Association and the National 
Association of Wheat Growers, Homer, Illinois; and Mr. Dennis 
Wiese, National Farmers Union, Flandreau, South Dakota.
    The witnesses testified that in order for the Federal 
system to be a reliable business partner, GIPSA must have the 
flexibility to act quickly and to anticipate changes because 
the grain trade is dynamic. With the growth of inherent traits 
in commodities that bring value to end-uses, tests and 
standards must be developed to help identify and preserve the 
true quality of the commodity. All agreed that the credibility 
and integrity of the official system is very important to grain 
handlers and to U.S. exporters.

                             COMMITTEE VOTE

    In compliance with paragraph 7 of rule XXVI of the Standing 
Rules of the Senate, the following statements are made 
concerning the votes of the Committee in its consideration of 
the bill:
    The Committee met in open session on Tuesday, June 20, 2000 
and, in the presence of a quorum, ordered that the bill be 
favorably reported by a voice vote.

                    IV. Regulatory Impact Statement

    In compliance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the following evaluation is made 
concerning the regulatory impact of enacting this legislation:
    According to industry sources, there are at least 7,500 to 
8,000 wheat and feed grain handling facilities and exporters 
and 512 cotton exporters, mills and warehouses that could be 
impacted by this legislation. This legislation reauthorizes 
current law allowing the continued collection of fees for 
mandatory grain inspection and weighing services for exports. 
Domestic grain handlers can request this service on a voluntary 
basis from designated inspection agencies. Lowering the ceiling 
for administrative expenses may decrease costs for exporters. 
Greater flexibility is provided in the methods for sampling 
commodities. Greater cost efficiency could also come from 
providing the Grain Inspection Packers and Stockyards 
Administration the authority to contract for the commodity 
weighing and inspection functions. Another effective measure 
would allow, under certain conditions, more than one official 
agency to perform inspection and weighing services within a 
single geographic area at interior locations. Finally the bill 
eliminates a requirement for annual testing for some equipment 
used in sampling, grading, inspection and weighing.
    This legislation also authorizes the use of electronic 
warehouse receipts for grain commodities stored in licensed 
warehouses. According to the U.S. Department of Agriculture, 
there are currently 908 federally licensed grain warehouses, 
many with multiple facilities. Under this legislation, all 
licensed warehouses would have the option to use electronic 
warehouse receipts, increasing efficiency and reducing 
paperwork. The cotton industry has used electronic warehouse 
receipts for the past eight years and has realized 
approximately $1 billion in savings due to process timeliness 
and cost effectiveness. Providing the option of electronic 
warehouse receipts will help the U.S. commodity industry be 
competitive in the global marketplace.
    In the miscellaneous provisions of the bill, the Secretary 
of Agriculture is authorized to assess and collect reasonable 
fees to mediate and arbitrate disputes arising between parties 
in foreign commerce. This is a voluntary service. The bill also 
extends the authorization of funding for state mediation 
programs under which participation is voluntary.
    There should be no adverse impact on the personal privacy 
of individuals affected by this legislation.

                     V. Budgetary Impact Statement

    In accordance with paragraph 11(a) of rule XXVI of the 
Standing Rules of the Senate, the following letter has been 
received from the Congressional Budget Office regarding the 
budgetary impact of the bill:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, July 27, 2000.
Hon. Richard G. Lugar,
Chairman, Committee on Agriculture, Nutrition, and Forestry,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for the Grain Standards and 
Warehouse Improvement Act of 2000.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Jim Langley 
(for federal costs) and Jean Wooster (for the private-sector 
impact).
            Sincerely,
                                          Steven Lieberman,
                                    (For Dan L. Crippen, Director).
    Enclosure.

Grain Standards and Warehouse Improvement Act of 2000

    Summary: This legislation would amend and reauthorize the 
United States Grain Standards Act. It also would amend the 
United States Warehouse Act and reauthorize the State 
Agricultural Loan Mediation Program. Finally, the bill would 
authorize appropriations for grants for energy generation, 
transmission, and distribution facilities in rural communities 
with high energy costs, and for grants and loans under the 
Community Facilities Grant Program for rural communities with 
extreme unemployment and severe economic depression.
    CBO estimates that implementing the bill would cost $30 
million in 2001 and $386 million over the 2001-2005 period, 
subject to the appropriation of the necessary amounts. The bill 
would authorize the collection and spending of fees for the 
government's expenses when providing mediation and arbitration 
services to certain firms involved in international trade of 
agriculture products, and for certain grain inspection 
services. Because the bill would affect direct spending pay-as-
you-go procedures would apply, but CBO estimates that this 
provision would not have a significant net budgetary effect in 
any year.
    The bill contains no intergovernmental mandates as defined 
in the Unfunded Mandates Reform Act (UMRA). State, local, and 
tribal governments might incur some costs to match the federal 
grants authorized by this bill, but those costs would be 
voluntary.
    By extending the United States Grain Standards Act, the 
Grain Standards and Warehouse Improvement Act of 2000 would 
impose a private-sector mandate as defined by UMRA on grain 
exporters in the form of fees. CBO estimates that the direct 
cost of the mandate would be below the annual threshold 
established by UMRA for private-sector mandates ($109 million 
in 2000, adjusted annually for inflation).
    Estimated cost to the Federal Government: The estimated 
impact of the bill is shown in the following table. The costs 
of this legislation fall within budget function 350 
(agriculture) and 450 (community and regional development).

------------------------------------------------------------------------
                                   By fiscal year, in million of dollars
                                 ---------------------------------------
                                   2001    2002    2003    2004    2005
------------------------------------------------------------------------
            CHANGES IN SPENDING SUBJECT TO APPROPRIATION \1\

Estimated Authorization Level...     124     126     129     131     134
Estimated Outlays...............      30      50      80     104     122
------------------------------------------------------------------------
\1\ In addition, the bill would authorize the collection and spending of
  fees for certain mediation and inspection services, but CBO estimates
  the net budgetary effect of these provisions would be negligible each
  year.

    Basis of estimate: For this estimate, CBO assumes that the 
necessary amounts will be appropriated for each fiscal year and 
that outlays will follow the pattern of past appropriations for 
similar activities.

Grain standards

    Title I would amend and reauthorize the United States Grain 
Standards Act through 2005. Under current law the Secretary's 
authority under this act expires at the end of 2000. CBO 
estimates that spending under the Grains Standard Act would be 
$16 million for 2001, and $87 million for fiscal years 2001 
through 2005, assuming appropriations of the necessary amounts. 
The Federal Grain Inspection Service (FGIS), an agency of the 
U.S. Department of Agriculture, is required to officially weigh 
and inspect most grain exported from the United States. Upon 
request by private groups, FGIS also provides official 
inspection and weighing of U.S. grain in domestic commerce. 
FGIS is authorized to collect fees from grain exporters and 
private groups requesting such services. The agency is 
authorized to spend such fees without further appropriation to 
cover the cost of services performed. This legislation would 
extend that authority.

Warehouses

    Title II would revise the United States Warehouse Act. It 
also would authorize the use of electronic warehouse receipts 
for all commodities stored in licensed warehouses. Current law 
requires the use of paper warehouse receipts, except for 
cotton. CBO expects that these changes to the act would have a 
negligible budgetary impact.

Miscellaneous provisions

    Title III would authorize appropriations for new programs, 
including assistance for energy generation, transmission, and 
distribution facilities, and the development of new community 
facilities. CBO estimates that implementing these programs 
would cost about $15 million in 2001, and about $300 million 
over the 2001-2005 period, assuming appropriation of the 
necessary amounts. This title also would authorize the 
collection and spending of fees to mediate certain 
international trading disputes.
    Section 301 would authorize grants and loans to states, and 
other entities to develop, upgrade, and improve the efficiency 
of energy generation, transmission, and distribution facilities 
in communities where the average residential expenditure for 
home energy is at least 275 percent of the national average of 
such expenditures. The bill would authorize the appropriation 
of $50 million for fiscal year 2001 and such sums as necessary 
for each subsequent year. For this estimate, we assume that 
funding in subsequent years would remain at the 2001 level, 
adjusted for anticipated inflation.
    This title would authorize the Secretary of Agriculture to 
assess and collect reasonable fees and late payment penalties 
to mediate and arbitrate disputes arising between parties in 
foreign commerce under the jurisdiction of a multinational 
entity, such as the World Trade Organization. Any fees 
collected must be deposited into the account that incurred the 
cost of providing the mediation or arbitration service. There 
would be no requirement to use such services. Fees and 
penalties collected would be available to the Secretary without 
further appropriation, so we estimate that there would be no 
net change in spending.
    Section 304 would authorize grants to develop specified 
community facilities in rural communities that have 
unemployment rates greater than the lesser of 500 percent of 
the average national unemployment rate on the enactment and 200 
percent of the average national unemployment rate during the 
Great Depression. The bill authorizes the appropriation of $50 
million in fiscal year 2001 and such sums as necessary for each 
subsequent year. For this estimate, we assume that funding in 
subsequent years would remain at the 2001 level, adjusted for 
anticipated inflation.
    Section 306 would reauthorize the state agricultural loan 
mediation program through 2005. Under current law, the annual 
authorization of $7.5 million for this program will expire in 
2000. CBO estimates that the cost of extending this program 
would cost $38 million over the 2001-2005 period, assuming 
appropriation of the authorized amounts.
    Pay-as-you-go considerations: The Balanced Budget and 
Emergency Deficit Control Act sets up pay-as-you-go procedures 
for legislation affecting direct spending or receipts. The bill 
would affect direct spending by authorizing the Secretary to 
collect and spend fees for the mediation and arbitration of 
international disputes involving agricultural products moving 
in foreign commerce under multinational entities. CBO estimates 
that this provision would have a negligible net impact in each 
year.
    Estimated impact on state, local, and tribal governments: 
This bill contains no intergovernmental mandates as defined in 
UMRA. Title III would authorize new federal spending for 
grants, which would benefit communities with high energy costs 
and high unemployment. Any spending by state, local, or tribal 
governments to match these federal funds would be voluntary.
    Estimated impact on the private sector: By extending the 
United States Grain Standards Act, the Grain Standards and 
Warehouse Improvement Act of 2000 would impose a private-sector 
mandate as defined by UMRA on grain exporters in the form of 
fees. Under current law, the FGIS authority to collect fees 
from grain exporters requesting its services expires at the end 
of the fiscal year 2000. This bill would extend that authority 
through fiscal year 2005. CBO estimates that the direct cost of 
the mandate would be below the annual threshold established by 
UMRA for private-sector mandates ($109 million in 2000, 
adjusted annually for inflation).
    Estimate prepared by: Federal Costs: Jim Langley. Impact on 
State, Local, and Tribal Governments: Marjorie Miller. Impact 
on the Private Sector: Jean Wooster.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                      VI. Changes in Existing Law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made in 
the bill, as reported are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
material is printed in italic, existing law in which no change 
is proposed is shown in roman):

                   UNITED STATES GRAIN STANDARDS ACT


             OFFICIAL INSPECTION AND WEIGHING REQUIREMENTS

    Sec. 5. (a) Whenever standards or procedures, are effective 
under section 4 of this Act for any grain--
          (1) no person shall ship from the United States to 
        any place outside thereof any lot of such grain, unless 
        such lot is officially weighed and officially inspected 
        [(on the basis of official samples taken after final 
        elevation as near the final spout through which the 
        grain passes as physically practicable as it is being 
        loaded aboard, or while it is in, the final carrier in 
        which it is be transported from the United States)] in 
        accordance with such standards or procedures, and 
        unless a valid official certificate showing the 
        official grade designation

           *       *       *       *       *       *       *


               official inspection authority and funding

    Sec. 7. * * *

           *       *       *       *       *       *       *

    (f)(2) Not more than one official agency or State delegated 
authority pursuant to subsection (e)(2) of this section for 
carrying out the inspection provisions of this Act shall be 
operative at one time for any geographic area as determined by 
the Secretary to effectuate the objectives stated in section 2 
of this Act, except that the Secretary may [conduct pilot 
programs to] allow more than 1 official agency to carry out 
inspections within a single geographical area without 
undermining the policy stated in section 2.

           *       *       *       *       *       *       *

    (j)(4) The duties imposed by paragraph (2) on designated 
official agencies and State agencies described in such 
paragraph and the investment authority provided by paragraph 
(3) shall expire on September 30, [2000] 2005. After that date, 
the fees established by the Secretary pursuant to paragraph (1) 
shall not cover administrative and supervisory costs related to 
the official inspection of grain.

                           weighing authority

    Sec. 7A. (i) No State or local governmental agency or 
person other than an authorized employee of the Secretary shall 
perform official weighing or supervision of weighing for the 
purposes of this Act except in accordance with the provisions 
of an unsuspended and unrevoked delegation of authority or 
designation by the Secretary as provided in this section or as 
otherwise provided in section 7(i) and subsection (d). Not more 
than one official agency or State delegated authority pursuant 
to subsection (c)(2) of this section for carrying out the 
weighing provisions of this Act shall be operative at one time 
for any geographic area as determined by the Secretary to 
effectuate the objectives stated in section 2 of this Act, 
except that the Secretary may [conduct pilot programs to] allow 
more than 1 official agency to carry out the weighing 
provisions within a single geographic area without undermining 
the policy stated in section 2.

           *       *       *       *       *       *       *

    (3) The authority provided to the Secretary by paragraph 
(1) and the duties imposed by paragraph (2) on agencies and 
other persons described in such paragraph shall expire on 
September 30,[ 2000] 2005.
    Sec. 7B. (a) The Secretary shall provide for the testing of 
all equipment used in the sampling, grading, inspection, and 
weighing for the purpose of official inspection, official 
weighing, or supervision of weighing of grain located at all 
grain elevators, warehouses, or other storage or handling 
facilities at which officials inspection or weighing services 
are provided under this Act, to be made on a random and 
periodic basis, [but at least annually and] under such 
regulations as the Secretary may prescribe, as the Secretary 
deems necessary to assure the accuracy and integrity of such 
equipment.

           *       *       *       *       *       *       *

    Sec. 7D. The total administrative and supervisory costs 
which may be incurred under this Act for services performed 
(excluding standardization, compliance, and foreign monitoring 
activities) for each of the fiscal years 1989 through [2000] 
2005 shall not exceed [40 per centum] 30 percent of the total 
costs for such activities carried out by the Secretary for such 
year.
    Sec. 8. (a) The Secretary is authorized--
          (1) * * *

           *       *       *       *       *       *       *

          (3) to contract with any person or government agency 
        to perform specified sampling, laboratory testing, 
        inspection, weighing, and similar technical functions * 
        * *

           *       *       *       *       *       *       *

    Sec. 13.(e)(1) The Secretary may prohibit the contamination 
of sound and pure grain, or prohibit disguising the quality of 
grain, as a result of the introduction of * * *

           *       *       *       *       *       *       *

    Sec. 19. There are hereby authorized to be appropriated 
such sums as are necessary for standardization and compliance 
activities, monitoring in foreign ports grain officially 
inspected and weighed under this Act, and any other expenses 
necessary to carry out the provisions of this Act for each of 
the fiscal years 1988 through [2000] 2005, to the extent that 
financing is not obtained from fees and sales of samples as 
provided for in sections 7, 7A, 7B, 16, and 17A * * *

           *       *       *       *       *       *       *

    Sec. 21. (e) The authority provided to the Secretary for 
the establishment and maintenance of an advisory committee 
under this section shall expire on September 30, [2000] 2005 * 
* *

           *       *       *       *       *       *       *


               UNITED STATES GRAIN STANDARDS ACT OF 1976

           *       *       *       *       *       *       *



                     official inspection authority

    Sec. 8. [(a)] Amends 7 of the United States Grain Standards 
Act.

           *       *       *       *       *       *       *

    [(b)(1) In order to provide information for use by the 
Congress in evaluating the needs of the grain inspection and 
weighting system at points in the United States other than at 
export port locations; the Administrator of the Federal Grain 
Inspection Service, the Director of the Office of Investigation 
of the United States Department of Agriculture (or such other 
organization or agency within the Department of Agriculture 
which may be delegated the authority, in lieu thereof, to 
conduct investigations on behalf of the Department of 
Agriculture), and the Comptroller General of the United States 
shall severally conduct investigations into and study grain 
inspection and weighting in the interior of the United States. 
The studies shall address, but are not limited to, the tasks of 
(A) determining the reliability and effectiveness of present 
official inspection and weighting procedures in the interior of 
the United States, and (B) evaluating the operating procedures 
and management practices of agencies providing grain inspection 
and weighing services in the interior of the United States, as 
they relate to the integrity and accuracy of the services.
    [(2) The Director of the Office of Investigation 
specifically is directed to study the extent of any 
irregularities or problem areas under the present inspection 
and weighing systems and conflicts of interest rules and 
develop factual summaries of evidence disclosed in the 
Director's investigations into violations of the United States 
Grain Standards Act, the grain weighing provisions of the 
United States Warehouse Act, and related provisions of title 18 
of the United States Code: Provided, That the Director shall 
not submit such summary with respect to any criminal 
investigation which is pending at the time the reports is due.
    [(3) The Administrator of the Federal Grain Inspection 
Service shall make findings with respect to present grain 
inspection and weighing agencies at each inland terminal 
marketing area of the United States at which over fifty million 
bushels of grain are inspected in an average year, such 
findings to include (A) results of interviews with shippers who 
ship grain to and consignees who receive grain from such 
terminal marketing areas, and (B) a thorough analysis of 
inspection and weighing error rates of such agencies (which may 
include the application of statistical tolerances for expected 
variations), based on existing documentation and the sampling 
during the investigation of a representative number of randomly 
selected lots of grain shipped to and from such terminal 
marketing areas.
    [(4) The Director of the Office of Investigation and the 
Administrator of the Federal Grain Inspection Service shall 
complete their investigations and study and shall submit their 
reports to the Committee on Agriculture of the House of 
Representatives and the Committee on Agriculture, Nutrition and 
Forestry of the Senate and the Comptroller General not later 
than thirty months after the effective date of this Act.
    [(5) The Comptroller General, in making his investigations 
and study, shall (A) assess the present grain inspection and 
weighing systems in the interior of the United States, and (B) 
evaluate the reports submitted under this subsection by the 
Director of the Office of Investigation and the Administrator 
of the Federal Grain Inspection Service. The Comptroller 
General shall submit a report setting forth the findings of 
such study and evaluation and his recommendations for changes 
in the United States Grain Standards Act to such Committees not 
later than three years after the effective date of this Act.]

           *       *       *       *       *       *       *


               [purchase or lease of inspection equipment

    [Sec. 23. Notwithstanding the provisions of section 3709 of 
the Revised Status (41 U.S.C. 5) and section 302 of the Federal 
Property and Administrative Service Act of 1949 (40 U.S.C. 
490), the Administrator of the Federal Grain Inspection Service 
is authorized to negotiate for and purchase or lease, from any 
person licensed or designated (on the date of enactment of this 
Act) to perform official inspection functions under the United 
States Grain Standards Act, at fair market value, any 
facilities or equipment which the Administrator determines to 
be necessary for the conduct of official inspection.

                      [STUDIES OF GRAIN STANDARDS

    [Sec. 24 (a) In order to assure that producers, handlers, 
and transporters of grain are encouraged and rewarded for the 
production, maintenance, and delivery of high quality grain and 
grain of the type needed to meet the end-use requirements of 
domestic and foreign buyers, the Administrator of the Federal 
Grain Inspection Service shall conduct an investigation and 
make a study regarding the adequacy of the current grain 
standards established under the United States Grain Standards 
Act.
    [(b) To determine the items of concern to buyers, both 
foreign and domestic, and how sellers in the United States 
might best satisfy those needs, the Administrator may seek the 
advice of and may employ the services of representatives of the 
grain industry, land-grant colleges, and other members of the 
public (without regard to the provisions of title 5 of the 
United States Code, governing appointments in the competitive 
service).
    [(c) The study shall address specifically, but is not 
limited thereto, the tasks of determining (A) if standards may 
be developed that would reduce grading errors and remove, where 
possible, subjective human judgment from grading by increased 
utilization of mechanical, electrical, and chemical means of 
grading, (B) whether grain should be subclassed according to 
color or other factor not affecting the quality of the grain, 
(C) whether the protein factor should be included in the 
standards, and (D) whether broken grain should be grouped 
together with foreign material.
    [(d) On the basis of the results of such study, the 
Administrator in accordance with section 4 of the United States 
Grain Standards Act, shall make such changes in the grain 
standards as he determines necessary and appropriate, and, not 
later than two years after the date of enactment of this Act, 
submit a report to the Congress setting forth the findings of 
such study and action taken by him as result of the study.

       [temporary exercise of powers, duties, and authorizations

    [Sec. 25. The powers, duties, and authorizations 
established by thisAct for the Administrator of the Federal 
Grain Inspection Service shall in all instances be exercised by the 
Secretary of Agriculture of the United States during the period between 
the effective date of this Act and the appointment of the 
Administrator.]

           *       *       *       *       *       *       *


                             effective date

    Sec. 27. This Act shall become effective thirty days after 
enactment hereof[; and thereafter no State or other agency or 
person shall provide official inspection or official weighing 
or supervision of weighing under the United States Grain 
Standards Act, as amended by this Act, at an export port 
location without a delegation of authority or other 
authorization under such amended Act, and no agency or person 
shall provide official inspection service or official weighing 
or supervision of weighing under such amended Act in any other 
area without a designation or other authorization under such 
amended Act, except that any agency or person then providing 
such service in any area may continue to operate in that area 
without a delegation or designation or other authorization 
under such Act but shall be subject to all provisions of the 
United States Grain Standards Act and regulations thereunder in 
effect immediately prior to the effective date of this Act, 
until whichever of the following events occurs first:
            [(1) a delegation or designation of such agency or 
        person to perform such services is granted or denied by 
        the Administrator of the Federal Grain Inspection 
        Service pursuant to the United States Grain Standards 
        Act, as amended by this Act; or
            [(2) such agency or person, or two or more members 
        of employees thereof, have been or are convicted of a 
        violation of any provision of the United States Grain 
        Standards Act in effect immediately prior to the 
        effective date of this Act; or convicted of any offense 
        proscribed by other Federal law involving the handling, 
        weighing, or official inspection of grain: Provided, 
        That the Administrator may allow such affected agency 
        or person to continue to operate in that area if the 
        Administrator determines that such continued operations 
        are necessary or desirable in carrying out the 
        requirements of this Act: Provided further, That the 
        Administrator shall, within 30 days after making such 
        determination, submit a report to the Committee on 
        Agriculture of the House of Representatives and the 
        Committee on Agriculture, Nutrition, and Forestry of 
        the Senate detailing the factual bases for such 
        determination; or
            [(3) with respect to export port locations the 
        expiration of a period determined by the Administrator 
        of not more than eighteen months following the 
        effective date hereof; or
            [(4) with respect to any other area, the expiration 
        of a period as determined by the Administrator of not 
        more than two years following the effective date 
        hereof:
Provided, That the Administrator is authorized and directed to 
cause official inspection and official weighing of grain 
pursuant to the provision of the United States Grain Standards 
Act, as amended by this Act, to be performed by authorized 
employees of the United States Department of Agriculture or the 
Service, to begin at any time immediately thereafter the date 
of enactment of this Act, at those export port locations and 
export elevators located at export port locations at which the 
Administrator determines that such performance by such 
authorized employees is necessary to effectuate the provisions 
of section 2 of the United States Grain Standards Act, as 
amended.].

           *       *       *       *       *       *       *


                      UNITED STATES WAREHOUSE ACT

    [That this Act shall be known by the short title of 
``United States Warehouse Act.''
    [Sec. 2. That the term ``warehouse'' as used in this Act 
shall be deemed to mean every building, structure, or other 
protected inclosure in which any agricultural product is or may 
be stored for interstate or foreign commerce, or, if located 
within any place under the exclusive jurisdiction of the United 
States, in which any agricultural product is or may be stored. 
As used in this Act, ``person'' includes a corporation or 
partnership or two or more persons having a joint or common 
interest: ``warehouseman'' means a person lawfully engaged in 
the business of storing agricultural products; and ``receipt'' 
means a warehouse receipt.
    [Sec. 3. That the Secretary of Agriculture is authorized to 
investigate the storage, warehousing, classifying according to 
grade and otherwise, weighing, and certification of 
agricultural products; upon application to him by any person 
applying forlicense to conduct a warehouse under this Act, to 
inspect such warehouse or cause it to be inspected; at any time, with 
or without application to him, to inspect or cause to be inspected all 
warehouse licensed under this Act; to determine whether warehouses for 
which licenses are applied for or have been issued under this Act are 
suitable for the proper storage of any agricultural product or 
products; to classify warehouses licensed or applying for a license in 
accordance with their ownership, location, surroundings, capacity, 
conditions, and other qualities and as to the kinds of licenses issued 
or that may be issued for them pursuant to this Act; and to prescribe, 
within the limitations of this Act, the duties of the warehousemen 
conducting warehouses licensed under this Act with respect to their 
care of and responsibility for agricultural products stored therein.
    [Sec. 4. That the Secretary of Agriculture, or his 
designated representative, is authorized, upon application to 
him, to issue to any warehouseman a license for the conduct of 
a warehouse or warehouses in accordance with this Act and such 
rules and regulations as may be made hereunder: Provided, That 
each such warehouse be found suitable for the proper storage of 
the particular agricultural product or products for which 
license is applied for, and that such warehouseman agree, as a 
condition to the granting of the license, to comply with and 
abide by all the terms of this Act and the rules and 
regulations prescribed hereunder.
    [Sec. 5. That each license issued under sections four and 
nine of this Act shall terminate as therein provided, or in 
accordance with the terms of this Act and the regulations 
thereunder, and may from time to time be modified or extended 
by written instrument.
    [Sec. 6. That each warehouseman applying for a license to 
conduct a warehouse in accordance with this Act shall, as a 
condition to the granting thereof, execute and file with the 
Secretary of Agriculture a good and sufficient bond to the 
United States to secure the faithful performance of his 
obligations as a warehouseman under the terms of this Act and 
the rules and regulations prescribed hereunder, and of such 
additional obligations as a warehouseman as may be assumed by 
him under contracts with the respective depositors of 
agricultural products in such warehouse. Said bond shall be in 
such form and amount, shall have such surety or sureties, 
subject to service of process in suits on the bond within the 
State, District, or Territory in which the warehouse is 
located, and shall contain such terms and conditions as the 
Secretary of Agriculture may prescribe to carry out the 
purposes of this Act, and may, in the discretion of the 
Secretary of Agriculture, include the requirements of fire and/
or other insurance. Whenever the Secretary of Agriculture, or 
his designated representative, shall determine that a 
previously approved bond is, or for any cause has become, 
insufficient, he may require an additional bond or bonds to be 
given by the warehouseman concerned, conforming with the 
requirements of this section, and unless the same be given 
within the time fixed by a written demand therefor the license 
of such warehouseman may be suspended or revoked.
    [Sec. 7. That any person injured by the breach of any 
obligation to secure which a bond is given, under the 
provisions of sections six or nine, shall be entitled to sue on 
the bond in his own name in any court of competent jurisdiction 
to recover the damages he may have sustained by such breach.
    [Sec. 8. That upon the filing with and approval by the 
Secretary of Agriculture, or his designated representative, of 
a bond, in compliance with this Act, for the conduct of a 
warehouse, such warehouse may be designated as bonded 
hereunder; but no warehouse shall be designed as bonded under 
this Act, and no name or description conveying the impression 
that it is so bonded, shall be used, until a bond, such as 
provided for in section 6, has been filed with and approved by 
the Secretary of Agriculture, or his designated representative, 
nor unless the license issued under this Act for the conduct of 
such warehouse remains unsuspended and unrevoked.
    [Sec. 9. That the Secretary of Agriculture, or his 
designated representative, may, under such rules and 
regulations as he shall prescribe, issue a license to any 
person not a warehouseman to accept the custody of agricultural 
products, and to store the same in a warehouse or warehouses 
owned, operated, or leased by any State, upon condition that 
such person agree to comply with and abide by the terms of this 
Act and the rules and regulations prescribed hereunder. Each 
person so licensed shall issue receipts for the agricultural 
products placed in his custody, and shall give bond, in 
accordance with the provisions of this Act, and the rules and 
regulations hereunder affecting warehousemen licensed under 
this Act, and shall otherwise be subject to this Act, and such 
rules and regulations, to the same extent as is provided for 
warehousemen licensed hereunder.
    [Sec. 10. The Secretary of Agriculture, or the Secretary's 
designated representative, shall charge, assess, and cause to 
becollected a reasonable fee for (1) each examination or 
inspection of a warehouse (including the physical facilities and 
records thereof and the agricultural products therein) under this Act; 
(2) each license issued to any person to classify, inspect, grade, 
sample, or weigh agricultural products stored or to be stored under 
provisions of this Act; (3) each annual warehouse license issued to a 
warehouseman to conduct a warehouse under this Act; and (4) each 
warehouse license amended, modified, extended, or reinstated under this 
Act. Such fees shall cover, as nearly as practicable, the costs of 
providing such services and licenses, including administrative and 
supervisory costs: Provided, That the amount of such fees collected for 
cotton warehouse inspections shall not exceed $400,000 in the fiscal 
year ending September 30, 1982, $415,000 in the fiscal year ending 
September 30, 1983, and $430,000 in the fiscal year ending September 
30, 1984. All fees collected shall be credited to the current 
appropriation account that incurs the costs and shall be available 
without fiscal year limitation to pay the expenses of the Secretary 
incident to providing services under this Act. The Secretary may 
deposit such funds in an interest bearing account with a financial 
institution. If any interest is earned on this account such interest 
shall be credited to the account for use by the Secretary in providing 
such services.
    [Sec. 11. That the Secretary of Agriculture, or his 
designated representative, may upon presentation of 
satisfactory proof of competency, issue to any person a license 
to inspect, sample, or classify any agricultural product or 
products, stored or to be stored in a warehouse licensed under 
this Act, according to condition, grade, or otherwise and to 
certificate the condition, grade, or other class thereof, or to 
weigh the same and certificate to a business required to 
register under subsection (a) and with respect to applicable 
interstate business if--

           *       *       *       *       *       *       *

                  [(A) such person has an ownership interest of 
                10 per centum or more in such business, or
                  [(B) a business or group of business 
                entities, with respect to which such person is 
                in a control relationship, has an ownership 
                interest of 10 per centum or more in such 
                business.
          [(3) For purposes of clauses (A) and (B) of paragraph 
        (2) of this subsection, a person shall be considered to 
        own the ownership interest which is owned by his or her 
        spouse, minor children, and relatives living in the 
        same household.
    [(c) The Administrator shall issue a certificate of 
registration to persons who comply with the provisions of this 
section. The certificate or registration issued in accordance 
with this section shall be renewed annually. If there has been 
any change in the information required under subsection (b), 
the pe so far as the same may relate to him, or that he has 
used his license or allowed it to be used for any improper 
purpose whatever. Pending investigation, the Secretary of 
Agriculture, or his designated representative, whenever he 
deems necessary, may suspend a license temporarily without 
hearing.
    [Sec. 12. That any license issued to any person to inspect, 
sample, or classify, or to weigh any agricultural product or 
products under this Act may be suspended or revoked by the 
Secretary of Agriculture, or his designated representative, 
whenever he is satisfied, after opportunity afforded to the 
licensee concerned for a hearing, that such licensee has failed 
to inspect, sample, or classify, or to weigh any agricultural 
product or products correctly, or has violated any of the 
provisions of this Act or of the rules and regulations 
prescribed hereunder, so far as the same may relate to him, or 
that he has used his license or allowed it to he used for any 
improper purpose whatever. Pending investigation, the Secretary 
of Agriculture, or his designated representative, whenever he 
deems necessary, may suspend a license temporarily without 
hearing.
    [Sec. 13. That every warehouseman conducting a warehouse 
licensed under this Act shall receive for storage therein, so 
far as its capacity permits, any agricultural product of the 
kind customarily stored therein by him which may be tendered to 
him in a suitable condition for warehousing, in the usual 
manner in the ordinary and usual course of business, without 
making any discrimination between persons desiring to avail 
themselves of warehouse facilities.
    [Sec. 14. That any person who deposits agricultural 
products for storage in a warehouse licensed under this Act 
shall be deemed to have deposited the same subject to the terms 
of this Act and the rules and regulations prescribed hereunder.
    [Sec. 15. That any fungible agricultural product stored for 
interstate or foreign commerce, or in any place under the 
exclusive jurisdiction of the United States, in a warehouse 
licensed under this Act shall be inspected and graded by a 
person duly licensed to grade the same under this Act.
    [Sec. 16. That every warehouseman conducting a 
warehouselicensed under this Act shall keep the agricultural products 
therein of one depositor so far separate from agricultural products of 
other depositors, and from other agricultural products of the same 
depositor for which a separate receipt has been issued, as to permit at 
all times the identification and redelivery of the agricultural 
products deposited; but if authorized by agreement or by custom, a 
warehouseman may mingle fungible agricultural products with other 
agricultural products of the same kind and grade, and shall be 
severally liable to each depositor for the care and redelivery of his 
share of such mass, to the same extent and under the same circumstances 
as if the agricultural products had been kept separate, but he shall at 
no time while they are in his custody mix fungible agricultural 
products of different grades.
    [Sec. 17. (a) Except as provided in subsection (b), for all 
agricultural products stored for interstate or foreign 
commerce, or in any place under the exclusive jurisdiction of 
the United States, in a warehouse licensed under this Act 
original receipts shall be issued by the warehouseman 
conducting the same, but no receipts shall be issued except for 
agricultural products actually stored in the warehouse at the 
time of the issuance thereof.
    [(b)(1) Notwithstanding any other provision of this Act, if 
a warehouseman because of a temporary shortage lacks sufficient 
space to store the agricultural products of all depositors in a 
licensed warehouse, the warehouseman may, in accordance with 
regulations issued by the Secretary of Agriculture and subject 
to such terms and conditions as the Secretary may prescribe, 
transfer stored agricultural products for which receipts have 
been issued out of such warehouse to another licensed warehouse 
for continued storage.
    [(2) The warehouseman of a licensed warehouse from which 
agricultural products have been transferred under paragraph (1) 
shall deliver to the rightful owner of such products, on 
request, at the licensed warehouse where first deposited, such 
products in the amount, and of the kind, quality, and grade, 
called for by the receipts or other evidence of storage of such 
owner.
    [(c)(1)(A) Notwithstanding any other provision of Federal 
or State law, the Secretary of Agriculture, or the designated 
representative of the Secretary, may provide that in lieu of 
issuing a receipt for cotton stored in a warehouse licensed 
under this Act or in any other warehouse the information 
required to be included in a receipt (i) under section 18 in 
the case of a warehouse licensed under this Act or (ii) under 
any applicable State law in the case of a warehouse not 
licensed under this Act shall be recorded instead in a central 
filing system or systems maintained in one or more locations in 
accordance with regulations issued by the Secretary.
    [(B) Any such record shall state that the cotton shall be 
delivered to a specified person or to the order of the person.
    [(C) This subsection and subsection (d) shall not apply to 
a warehouse that does not have facilities to electronically 
transmit and receive information to and from the central filing 
system. Nothing in this subsection shall be construed as to 
require a warehouseman to obtain the facilities.
    [(2) Notwithstanding any other provision of Federal or 
State law:
          [(A) The record of the possessory interests of 
        persons in cotton included in any such central filing 
        system shall be deemed to be a receipt for the purposes 
        of this Act or State law and shall establish the 
        possessory interest of persons in the cotton.
          [(B) Any person designated as a holder of an 
        electronic warehouse receipt authorized under this 
        subsection and subsection (d) shall, for the purpose of 
        perfecting the security interest of the person under 
        Federal or State law with respect to the cotton covered 
        by the warehouse receipt, be considered to be in 
        possession of the warehouse receipt. If more than one 
        security interest exist in the cotton reflected on the 
        electronic warehouse receipt, the priority of the 
        security interests shall be determined by the 
        applicable Federal or State law. This subsection is 
        applicable to electronic cotton warehouse receipts and 
        any other security interests covering cotton stored in 
        a cotton warehouse, regardless of whether the warehouse 
        is licensed under this Act.
    [(3) A warehouseman conducting a warehouse covered under 
this subsection, in the absence of a lawful excuse, shall, 
without unnecessary delay, deliver the cotton stored in the 
warehouse on demand made by the person named in the record in 
the central filing system as the holder of the receipt 
representing the cotton, if demand is accompanied by--
          [(A) an offer to satisfy a valid warehouseman's lien, 
        as determined by the Secretary; and
          [(B) an offer to provide an acknowledgment in the 
        central filing system, if requested by the 
        warehouseman, that the cotton has been delivered.
    [(d)(1) The Secretary shall (under such regulations as the 
Secretary may prescribe) charge and provide for the collection 
of reasonable fees to cover the estimated costs to the 
Department of Agriculture incident to the functioning and the 
maintenance of any central filing system or systems referred to 
in subsection (c) that is administered by the Department of 
Agriculture.
    [(2) The Secretary may provide for the fees to be collected 
by persons operating the central filing system administered by 
the Department from those persons recording information in the 
central filing system at such time and in such manner as may be 
prescribed in regulations issued by the Secretary.
    [(3) The fees shall be deposited into a fund which shall be 
available without fiscal year limitation for the expenses of 
the Secretary incurred in carrying out subsection (c) and this 
subsection. Any sums collected or received by the Secretary 
under this Act and deposited to the fund and any late payment 
penalties collected by the Secretary and credited to the fund 
may be invested by the Secretary in insured or fully 
collateralized, interest-bearing accounts or, at the discretion 
of the Secretary, by the Secretary of the Treasury in United 
States Government debt instruments. The interest earned on the 
sums and any late payment penalties collected by the Secretary 
shall be credited to the fund and shall be available without 
fiscal year limitations for the expenses of the Service 
incurred in carrying out subsection (c) and this subsection.
    [Sec. 18. That every receipt issued for agricultural 
products stored in a warehouse licensed under this Act shall 
embody within its written or printed terms (a) the location of 
the warehouse in which the agricultural products are stored; 
(b) the date of issue of the receipt; (c) the consecutive 
number of the receipt; (d) a statement whether the agricultural 
products received will be delivered to the bearer, to a 
specified person, or to a specified person or his order; (e) 
the rate of storage charges; (f) a description of the 
agricultural products received, showing the quantity thereof, 
or, in case of agricultural products customarily put up in 
bales or packages, a description of such bales or packages by 
marks, numbers, or other means of identification and the weight 
of such bales or packages; (g) the grade or other class of the 
agricultural products received and the standard or description 
in accordance with which such classification has been made: 
Provided, That such grade or other class shall be stated 
according to the official standard of the United States 
applicable to such agricultural products as the same may be 
fixed and promulgated under authority of law: Provided further, 
That until such official standards of the United States for any 
agricultural product or products have been fixed and 
promulgated, the grade or other class thereof may be stated in 
accordance with any recognized standard or in accordance with 
such rules and regulations not inconsistent herewith as may be 
prescribed by the Secretary of Agriculture; (h) a statement 
that the receipt is issued subject to the United States 
Warehouse Act and the rules and regulations prescribed 
thereunder; (i) if the receipt be issued for agricultural 
products of which the warehouseman is owner, either solely or 
jointly or in common with others, the fact of such ownership; 
(j) a statement of the amount of advances made and of 
liabilities incurred for which the warehouseman claims a lien: 
Provided, That if the precise amount of such advances made or 
of such liabilities incurred be at the time of the issue of the 
receipt unknown to the warehouseman or his agent who issues it, 
a statement of the fact that advances have been made or 
liabilities incurred and the purpose thereof shall be 
sufficient; (k) such other terms and conditions within the 
limitations of this Act as may be required by the Secretary of 
Agriculture; and (l) the signature of the warehouseman, which 
may be made by his authorized agent: Provided, That unless 
otherwise required by the law of the State in which the 
warehouse is located, when requested by the depositor of other 
than fungible agricultural products, a receipt omitting 
compliance with subdivision (g) of this section may be issued: 
Provided, however, The Secretary of Agriculture may in his 
discretion require that such receipt have plainly and 
conspicuously embodied in its written or printed terms a 
provision that such receipt is not negotiable.
    [Sec. 19. That the Secretary of Agriculture is authorized, 
from time to time, to establish and promulgate standards for 
agricultural products by which their quality or value may be 
judged or determined: Provided, That the standards for any 
agricultural products which have been, or which in future may 
be, established by or under authority or any other act of 
Congress shall be, and are hereby, adopted for the purpose of 
this Act as the official standards of the United States for the 
agricultural products to which they relate.
    [Sec. 20. That while an original receipt issued under this 
Act is outstanding and uncanceled by the warehouseman issuing 
the same no other or further receipt shall be issued for 
theagricultural product covered thereby or for any part thereof, except 
that in the cause of a lost or destroyed receipt a new receipt, upon 
the same terms and subject to the same conditions and bearing on its 
face the number and date of the receipt in lieu of which it is issued, 
may be issued upon compliance with the statutes of the United States 
applicable thereto in places under the exclusive jurisdiction of the 
United States or upon compliance with the laws of any State applicable 
thereto in any place not under the exclusive jurisdiction of the United 
States: Provided, That if there be in such case no statute of the 
United States or law of a State applicable thereto such new receipts 
may be issued upon the giving of satisfactory security in compliance 
with the rules and regulations made pursuant to this Act.
    [Sec. 21. That a warehouseman conducting a warehouse 
licensed under this Act, in the absence of some lawful excuse, 
shall, without unnecessary delay, deliver the agricultural 
products stored therein upon a demand made either by the holder 
of a receipt for such agricultural products or by the depositor 
thereof if such demand be accompanied with (a) an offer to 
satisfy the warehouseman's lien; (b) an offer to surrender the 
receipt, if negotiable, with such indorsements as would be 
necessary for the negotiation of the receipt; and (c) a 
readiness and willingness to sign, when the products are 
delivered, an acknowledgement that they have been delivered if 
such signature is requested by the warehouseman.
    [Sec. 22. That a warehouseman conducting a warehouse 
licensed under this Act shall plainly cancel upon the face 
thereof each receipt returned to him upon the delivery by him 
of the agricultural products for which the receipt was issued.
    [Sec. 23. That every warehouseman conducting a warehouse 
licensed under this Act shall keep in a place of safety 
complete and correct records of all agricultural products 
stored therein and withdrawn therefrom, of all warehouse 
receipts issued by him, and of the receipts returned to and 
canceled by him, shall make reports to the Secretary of 
Agriculture concerning such warehouse and the condition, 
contents, operation, and business thereof in such form and at 
such times as he may require, and shall conduct said warehouse 
in all other respects in compliance with this Act and the rules 
and regulations made hereunder.
    [Sec. 24. That the Secretary of Agriculture is authorized 
to cause examinations to be made of any agricultural product 
stored in any warehouse licensed under this Act. Whenever, 
after opportunity for hearings is given to the warehouseman 
conducting such warehouse, it is determined that he is not 
performing fully the duties imposed on him by this Act and the 
rules and regulations made hereunder, the Secretary may publish 
his findings.
    [Sec. 25. That the Secretary of Agriculture, or his 
designated representative, may, after opportunity for hearing 
has been afforded to the license concerned, suspend or revoke 
any license to any warehouseman conducting a warehouse under 
this Act, for any violation of or failure to comply with any 
provision of this Act or of the rules and regulations made 
hereunder, or upon the ground that unreasonable or exorbitant 
charges have been made for services rendered. Pending 
investigation, the Secretary of Agriculture, or his designated 
representative, whenever he deems necessary, may suspend a 
license temporarily without hearing.
    [Sec. 26. That the Secretary of Agriculture from time to 
time may publish the results of any investigations made under 
section three of this Act; and he shall publish the names and 
locations of warehouses licensed and bonded and the names and 
addresses of persons licensed under this Act and lists of all 
licenses terminated under this Act and the cause therefor.
    [Sec. 27. That the Secretary of Agriculture is authorized 
through officials, employees, or agents of the Department of 
Agriculture designated by him to examine all books, records, 
papers, and accounts of warehouses licensed under this Act and 
of the warehousemen conducting such warehouses relating 
thereto.
    [Sec. 28. That the Secretary of Agriculture shall from time 
to time make such rules and regulations as he may deem 
necessary for the efficient execution of the provisions of this 
Act.
    [Sec. 29. That in the discretion of the Secretary of 
Agriculture he is authorized to cooperate with State officials 
charged with the enforcement of State laws relating to 
warehouses, warehousemen, weighers, graders, inspectors, 
samplers, or classifiers; but the power, jurisdiction, and 
authority conferred upon the Secretary of Agriculture under 
this Act shall be exclusive with respect to all persons 
securing a license hereunder so long as said license remains in 
effect. This Act shall not be construed so as to limit the 
operation of any statute of the United States relating to 
warehouses or to warehouseman, weighers, graders, inspectors, 
samplers, or classifiers now in force in the District of 
Columbia or in any Territory or other place under the exclusive 
jurisdiction of the United States.
    [Sec. 30. That every person who shall forge, alter, 
counterfeit, simulate, or falsely represent, or shall without 
proper authority use, any license issued by the Secretary of 
Agriculture, or his designated representative, under this Act, 
or who shall violate or fail to comply with any provision of 
section 8 of this Act, or who shall issue or utter a false or 
fraudulent receipt or certificate, or furnish false or 
fraudulent information to a central filing system maintained 
under section 17, or change in any manner an original receipt 
or certificate subsequently to issuance by a license, or any 
person who, without lawful authority, shall convert to his own 
use, or use for purposes of securing a loan, or remove from a 
licensed warehouse contrary to this Act or the regulations 
promulgated thereunder, any agricultural products stored or to 
be stored in such warehouse, and for which licensed receipts 
have been or are to be issued, shall be deemed guilty of a 
misdemeanor, and upon conviction thereof shall be fined not 
more than $10,000, or double the value of the products involved 
if such double value exceeds $10,000, or imprisoned not more 
than ten years, or both, in the discretion of the court, and 
the owner of the agricultural products so converted, used, or 
removed may, in the discretion of the Secretary of Agriculture, 
be reimbursed for the value thereof out of any fine collected 
hereunder, by check drawn on the Treasury at the direction of 
the Secretary of Agriculture, for the value of such products to 
the extent that such owner has not otherwise been reimbursed. 
That any person who shall draw with intent to deceive, a false 
sample of, or who shall willfully mutilate or falsely represent 
a sample drawn under this Act, or who shall classify, grade, or 
weigh fraudulently, any agricultural products stored or to be 
stored under the provisions of this Act, shall be deemed guilty 
of a misdemeanor, and upon conviction thereof fined not more 
than $500, or imprisoned for not more than six months, or both, 
in the discretion of the court.
    [Sec. 31. There are hereby authorized to be appropriated 
such sums as are necessary to carry out the provisions of this 
Act other than those services for which fees are authorized 
pursuant to section 10. Such appropriated funds may be used by 
the Secretary to employ qualified persons not regularly in the 
service of the United States for temporary assistance in 
carrying out the provisions of this Act.
    [Sec. 32. That if any clause, sentence, paragraph, or part 
of this Act shall, for any reason, be adjudged by any court of 
competent jurisdiction to be invalid, such judgment shall not 
effect, impair, or invalidate the remainder thereof, but shall 
be confined in its operation to the clause, sentence, 
paragraph, or part thereof directly involved in the controversy 
in which such judgment shall have been rendered.
    [Sec. 33. That the right to amend, alter, or repeal this 
Act is hereby expressly reserved.]

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``United States Warehouse 
Act''.

SEC. 2. DEFINITIONS.

    In this Act:
          (1) Agricultural product.--The term ``agricultural 
        product'' means an agricultural commodity, as 
        determined by the Secretary, including a processed 
        product of an agricultural commodity.
          (2) Approval.--The term ``approval'' means the 
        consent provided by the Secretary for a person to 
        engage in an activity authorized by this Act.
          (3) Department.--The term ``Department'' means the 
        Department of Agriculture.
          (4) Electronic document.--The term ``electronic 
        document'' means a document authorized under this Act 
        generated, sent, received, or stored by electronic, 
        optical, or similar means, including electronic data 
        interchange, electronic mail, telegram, telex, or 
        telecopy.
          (5) Electronic receipt.--The term ``electronic 
        receipt'' means a receipt that is authorized by the 
        Secretary to be issued or transmitted under this Act in 
        the form of an electronic document.
          (6) Holder.--
                  (A) In general.--The term ``holder'' means a 
                person, as defined by the Secretary, that has 
                possession in fact or by operation of law of a 
                receipt or any electronic document.
                  (B) Inclusion.--The term ``holder'' includes 
                a person that has possession of a receipt or 
                electronic document as a creditor of another person.
          (7) Person.--The term ``person'' means--
                  (A) a person (as defined in section 1 of 
                title 1, United States Code);
                  (B) a State; and
                  (C) a political subdivision of a State.
          (8) Receipt.--The term ``receipt'' means a warehouse 
        receipt issued in accordance with this Act, including 
        an electronic receipt.
          (9) Secretary.--The term ``Secretary'' means the 
        Secretary of Agriculture.
          (10) Warehouse.--The term ``warehouse'' means a 
        structure or other approved storage facility, as 
        determined by the Secretary, in which any agricultural 
        product may be stored or handled for the purposes of 
        interstate or foreign commerce.
          (11) Warehouse operator.--The term ``warehouse 
        operator'' means a person that is lawfully engaged in 
        the business of storing or handling agricultural 
        products.

SEC. 3. POWERS OF SECRETARY.

    (a) In General.--The Secretary shall have exclusive power, 
jurisdiction, and authority, to the extent that this Act 
applies, with respect to--
          (1) each warehouse operator licensed under this Act;
          (2) each person that has obtained an approval to 
        engage in an activity under this Act; and
          (3) each person claiming an interest in an 
        agricultural product by means of an electronic document 
        or electronic receipt subject to this Act.
    (b) Covered Agricultural Products.--The Secretary shall 
specify, after an opportunity for notice and comment, those 
agricultural products for which a warehouse license may be 
issued under this Act.
    (c) Investigations.--The Secretary may investigate the 
storing, warehousing, classifying according to grade and 
otherwise, weighing, and certifying of agricultural products.
    (d) Inspections.--The Secretary may inspect or cause to be 
inspected any person or warehouse licensed under this Act and 
any warehouse for which a license is applied for under this 
Act.
    (e) Suitability for Storage.--The Secretary may determine 
whether a licensed warehouse, or a warehouse for which a 
license is applied for under this Act, is suitable for the 
proper storage of the agricultural product or products stored 
or proposed for storage in the warehouse.
    (f) Classification.--The Secretary may classify a licensed 
warehouse, or a warehouse for which a license is applied for 
under this Act, in accordance with the ownership, location, 
surroundings, capacity, conditions, and other qualities of the 
warehouse and as to the kinds of licenses issued or that may be 
issued for the warehouse under this Act.
    (g) Warehouse Operator's Duties.--Subject to the other 
provisions of this Act, the Secretary may prescribe the duties 
of a warehouse operator operating a warehouse licensed under 
this Act with respect to the warehouse operator's care of and 
responsibility for agricultural products stored or handled by 
the warehouse operator.
    (h) Systems for Conveyance of Title in Agricultural 
Products.--The Secretary may approve 1 or more systems under 
which title in agricultural products may be conveyed and under 
which documents relating to the shipment, payment, and 
financing of the sale of agricultural products may be 
transferred, including conveyance of receipts and any other 
written or electronic documents in accordance with a process 
established by the Secretary.
    (i) Examination and Audits.--The Secretary may conduct an 
examination, audit, or similar activity with respect to--
          (1) any person that is engaged in the business of 
        storing an agricultural product that is subject to this 
        Act;
          (2) any State agency that regulates the storage of an 
        agricultural product by such a person; or
          (3) any commodity exchange with regulatory authority 
        over the storage of agricultural products that are 
        subject to this Act.
    (j) Licenses for Operation of Warehouses.--The Secretary 
may issue to any warehouse operator a license for the operation 
of a warehouse in accordance with this Act if--
          (1) the Secretary determines that the warehouse is 
        suitable for the proper storage of the agricultural 
        product or products stored or proposed for storage in 
        the warehouse; and
          (2) the warehouse operator agrees, as a condition of 
        the license, to comply with this Act (including 
        regulations promulgated under this Act).
    (k) Licensing of Other Persons.--
          (1) In general.--On presentation of satisfactory 
        proof of competency to carry out the activities 
        described in this paragraph, the Secretary may issue to 
        any person a Federal license--
                  (A) to inspect any agricultural product 
                stored or handled in a warehouse subject to 
                this Act;
                  (B) to sample such an agricultural product;
                  (C) to classify such an agricultural product 
                according to condition, grade, or other class 
                and certify the condition, grade, or other 
                class of the agricultural product; or
                  (D) to weigh such an agricultural product and 
                certify the weight of the agricultural product.
          (2) Condition.--As a condition of a license issued 
        under paragraph (1), the licensee shall agree to comply 
        with this Act (including regulations promulgated under 
        this Act).
    (l) Examination of Books, Records, Papers, and Accounts.--
The Secretary may examine, using designated officers, 
employees, or agents of the Department, all books, records, 
papers, and accounts relating to activities subject to this Act 
of--
          (1) a warehouse operator operating a warehouse 
        licensed under this Act;
          (2) a person operating a system for the electronic 
        recording and transfer of receipts and other documents 
        authorized by the Secretary; or
          (3) any other person issuing receipts or electronic 
        documents authorized by the Secretary under this Act.
    (m) Cooperation With States.--The Secretary may--
          (1) cooperate with officers and employees of a State 
        who administer or enforce State laws relating to 
        warehouses, warehouse operators, weighers, graders, 
        inspectors, samplers, or classifiers; and
          (2) enter into cooperative agreements with States to 
        perform activities authorized under this Act.

SEC. 4. IMPOSITION AND COLLECTION OF FEES.

    (a) In General.--The Secretary shall charge, assess, and 
cause to be collected fees to cover the costs of administering 
this Act.
    (b) Rates.--The fees under this section shall be set at a 
rate determined by the Secretary.
    (c) Treatment of Fees.--All fees collected under this 
section shall be credited to the account that incurs the costs 
of administering this Act and shall be available to the 
Secretary without further appropriation and without fiscal year 
limitation.
    (d) Interest.--Funds collected under this section may be 
deposited in an interest bearing account with a financial 
institution, and any interest earned on the account shall be 
credited under subsection (c).
    (e) Efficiencies and Cost Effectiveness.--
          (1) In general.--The Secretary shall seek to minimize 
        the fees established under this section by improving 
        efficiencies and reducing costs, including the efficient 
        use of personnel to the extent practicable and consistent 
        with the effective implementation of this Act.
          (2) Report.--The Secretary shall publish an annual 
        report on the actions taken by the Secretary to comply 
        with paragraph (1).

SEC. 5. QUALITY AND VALUE STANDARDS.

    If standards for the evaluation or determination of the 
quality or value of an agricultural product are not established 
under another Federal law, the Secretary may establish 
standards for the evaluation or determination of the quality or 
value of the agricultural product under this Act.

SEC. 6. BONDING AND OTHER FINANCIAL ASSURANCE REQUIREMENTS.

    (a) In General.--As a condition of receiving a license or 
approval under this Act (including regulations promulgated 
under this Act), the person applying for the license or 
approval shall execute and file with the Secretary a bond, or 
provide such other financial assurance as the Secretary 
determines appropriate, to secure the person's performance of 
the activities so licensed or approved.
    (b) Service of Process.--To qualify as a suitable bond or 
other financial assurance under subsection (a), the surety, 
sureties, or financial institution shall be subject to service 
of process in suits on the bond or other financial assurance in 
the State, district, or territory in which the warehouse is 
located.
    (c) Additional Assurances.--If the Secretary determines 
that a previously approved bond or other financial assurance is 
insufficient, the Secretary may suspend or revoke the license 
or approval covered by the bond or other financial assurance if 
the person that filed the bond or other financial assurance 
does not provide such additional bond or other financial 
assurance as the Secretary determines appropriate.
    (d) Third Party Actions.--Any person injured by the breach 
of any obligation arising under this Act for which a bond or 
other financial assurance has been obtained as required by this 
section may sue with respect to the bond or other financial 
assurance in a district court of the United States to recover 
the damages that the person sustained as a result of the 
breach.

SEC. 7. MAINTENANCE OF RECORDS.

    To facilitate the administration of this Act, the following 
persons shall maintain such records and make such reports, as 
the Secretary may by regulation require:
          (1) A warehouse operator that is licensed under this 
        Act.
          (2) A person operating a system for the electronic 
        recording and transfer of receipts and other documents 
        that are authorized under this Act.
          (3) Any other person issuing receipts or electronic 
        documents that are authorized under this Act.

SEC. 8. FAIR TREATMENT IN STORAGE OF AGRICULTURAL PRODUCTS.

    (a) In General.--Subject to the capacity of a warehouse, a 
warehouse operator shall deal, in a fair and reasonable manner, 
with persons storing, or seeking to store, an agricultural 
product in the warehouse if the agricultural product--
          (1) is of the kind, type, and quality customarily 
        stored or handled in the area in which the warehouse is 
        located;
          (2) is tendered to the warehouse operator in a 
        suitable condition for warehousing; and
          (3) is tendered in a manner that is consistent with 
        the ordinary and usual course of business.
    (b) Allocation.--Nothing in this section prohibits a 
warehouse operator from entering into an agreement with a 
depositor of an agricultural product to allocate available 
storage space.

SEC. 9. COMMINGLING OF AGRICULTURAL PRODUCTS.

    (a) In General.--A warehouse operator may commingle 
agricultural products in a manner approved by the Secretary.
    (b) Liability.--A warehouse operator shall be severally 
liable to each depositor or holder for the care and redelivery 
of the share of the depositor and holder of the commingled 
agricultural product to the same extent and under the 
samecircumstances as if the agricultural products had been stored 
separately.

SEC. 10. TRANSFER OF STORED AGRICULTURAL PRODUCTS.

    (a) In General.--In accordance with regulations promulgated 
under this Act, a warehouse operator may transfer a stored 
agricultural product from 1 warehouse to another warehouse for 
continued storage.
    (b) Continued Duty.--The warehouse operator from which 
agricultural products have been transferred under subsection 
(a) shall deliver to the rightful owner of such products, on 
request at the original warehouse, such products in the 
quantity and of the kind, quality, and grade called for by the 
receipt or other evidence of storage of the owner.

SEC. 11. ISSUANCE OF RECEIPTS AND OTHER DOCUMENTS.

    (a) In General.--Subject to subsections (b) and (c) and 
except as otherwise provided in this Act, at the request of the 
depositor of an agricultural product stored or handled in a 
warehouse licensed under this Act, the warehouse operator shall 
issue a receipt to the depositor as prescribed by the 
Secretary.
    (b) Actual Storage Required.--A receipt may not be issued 
under this section for an agricultural product unless the 
agricultural product is actually stored in the warehouse at the 
time of the issuance of the receipt.
    (c) Contents.--Each receipt issued for an agricultural 
product stored or handled in a warehouse licensed under this 
Act shall contain such information, for each agricultural 
product covered by the receipt, as the Secretary may require by 
regulation.
    (d) Prohibition on Additional Receipts or Other 
Documents.--
          (1) Receipts.--While a receipt issued under this Act 
        is outstanding and uncanceled by the warehouse 
        operator, no other or further receipt may be issued for 
        the same agricultural product (or any portion of the 
        same agricultural product) represented by the 
        outstanding receipt, except as authorized by the 
        Secretary.
          (2) Other documents.--If a written or electronic 
        document is recorded or transferred under this section, 
        no other similar document in any form shall be issued 
        by any person with respect to the same agricultural 
        product represented by the document, except as 
        authorized by the Secretary.
    (e) Electronic Receipts and Electronic Documents.--Except 
as provided in subsection (f) and notwithstanding any other 
provision of Federal or State law:
          (1) In general.--The Secretary shall promulgate 
        regulations to authorize the issuance of electronic 
        receipts, and the recording and transfer of electronic 
        receipts and other documents, in accordance with this 
        subsection.
          (2) Systems for electronic recording and transfer.--
        Electronic receipts and electronic documents issued 
        with respect to an agricultural product may be recorded 
        in, and transferred under, a system or systems 
        maintained in 1 or more locations.
          (3) Treatment of holder.--The person designated as a 
        holder of an electronic receipt or other electronic 
        document shall be considered, for the purposes of 
        Federal and State law, to be in possession of the 
        receipt or document.
          (4) Security interests.--
                  (A) Perfection of interest.--Any security 
                interest lawfully asserted by a person under 
                any Federal or State law with respect to an 
                agricultural product that is the subject of an 
                electronic receipt, or an electronic document 
                filed under any system for electronic receipts 
                or other electronic documents issued or filed 
                in accordance with this Act, may be perfected 
                only by recording the security interest in the 
                system in the manner specified by the 
                regulations promulgated under paragraph (1).
                  (B) Effect of recordation.--The recordation 
                by a person of the person's security interest 
                in any agricultural product included in any 
                system for electronic receipts or other 
                electronic documents issued or filed in 
                accordance with this Act shall, for the 
                purposes of Federal and State law, establish 
                the security interest of the person.
                  (C) Priority.--If more than 1 security 
                interest exists in an agricultural product 
                covered by an electronic receipt, the priority 
                of the security interests shall be determined 
                by the applicable Federal or State law.
                  (D) Encumbrances.--
                          (i) Operators licensed under state 
                        law.--If a warehouse operator licensed 
                        under State law elects to issue an 
                        electronic receipt authorized under 
                        this subsection, a security interest, 
                        lien, or other encumbrance may be 
                        recorded on the electronic receipt 
                        under this subsection only if the 
                        security interest, lien, or other 
                        encumbrance is--
                                  (I) authorized by State law 
                                to be included on a written 
                                warehouse receipt; and
                                  (II) recorded in a manner 
                                prescribed by the Secretary.
                          (ii) Other applications.--If a 
                        warehouse operator licensed under this 
                        Act, or a warehouse operator not 
                        licensed under State law, elects to 
                        issue an electronic receipt authorized 
                        under this subsection, a security 
                        interest, lien, or other encumbrance 
                        shall be recorded on the electronic 
                        receipt in a manner prescribed by the 
                        Secretary.
          (5) Effect of purchase of receipt or document.--A 
        person purchasing an electronic receipt or electronic 
        document shall take possession of the agricultural 
        product free and clear of all liens, except those liens 
        recorded in the system or systems established under the 
        regulations promulgated under paragraph (1).
          (6) Acceptance.--
                  (A) In general.--An electronic receipt 
                issued, and an electronic document transferred, 
                in accordance with the regulations promulgated 
                under paragraph (1) shall be accepted in any 
                business, market, or financial transaction, 
                whether governed by Federal or State law.
                  (B) No electronic receipt required.--A person 
                shall not be required to issue a receipt or 
                document with respect to an agricultural 
                product in electronic format.
          (7) Legal effect.--Information created to comply with 
        this Act (including regulations promulgated under this 
        Act) shall not be denied legal effect, validity, or 
        enforceability on the ground that the information is 
        generated, sent, received, or stored by electronic or 
        similar means.
          (8) Option for state licensed warehouse operators.--
        Notwithstanding any other provision of this Act, a 
        State-licensed warehouse operator not licensed under 
        this Act may, at the option of the warehouse operator, 
        issue electronic receipts and electronic documents in 
        accordance with this subsection.
          (9) Application.--This subsection shall not apply to 
        a warehouse operator that is licensed under State law 
        to store agricultural commodities in a warehouse in the 
        State if the warehouse operator elects--
                  (A) not to issue electronic receipts 
                authorized under this subsection; or
                  (B) to issue electronic receipts authorized 
                under State law.
    (f) Electronic Receipts and Electronic Documents for 
Cotton.--
          (1) Authority.--
                  (A) Central filing.--Notwithstanding any 
                other provision of Federal or State law, the 
                Secretary, or the designated representative of 
                the Secretary, may provide that, in lieu of 
                issuing a receipt for cotton stored in a 
                warehouse licensed under this Act or in any 
                other warehouse, the information required to be 
                included in a receipt (i) under this Act in the 
                case of a warehouse licensed under this Act or 
                (ii) under any applicable State law in the case 
                of a warehouse not licensed under this Act, 
                shall be recorded instead in 1 or more central 
                filing systems maintained in 1 or more 
                locations in accordance with regulations 
                promulgated by the Secretary.
                  (B) Delivery of cotton.--Any record under 
                subparagraph (A) shall include a statement that 
                the cotton shall be delivered to a specified 
                person or to the order of the person.
                  (C) Electronic transmission facilities 
                between warehouses and system.--
                          (i) Nonapplicability to warehouses 
                        without facilities.--This subsection 
                        and section 4 shall not apply to a 
                        warehouse that does not have facilities 
                        to electronically transmit and receive 
                        information to and from a central 
                        filing system under this subsection.
                          (ii) No requirement to obtain 
                        facilities.--Nothing in this subsection 
                        requires a warehouse operator to obtain 
                        facilities described in clause (i).
          (2) Recordation and enforcement of liens in central 
        filing system.--Notwithstanding any other provision of 
        Federal or State law:
                  (A) Recordation.--The record of the 
                possessory interests of persons in cotton 
                included in a central filing system under this 
                subsection--
                          (i) shall be considered to be a 
                        receipt for the purposes of this Act 
                        and State law; and
                          (ii) shall establish the possessory 
                        interest of persons in the cotton.
                  (B) Enforcement.--
                          (i) Possession of warehouse 
                        receipt.--Any person designated as a 
                        holder of an electronic warehouse 
                        receipt authorized under this 
                        subsection or section 4 shall, for the 
                        purpose of perfecting the security 
                        interest of the person under Federal or 
                        State law with respect to the cotton 
                        covered by the warehouse receipt, be 
                        considered to be in possession of the 
                        warehouse receipt.
                          (ii) Priority of security 
                        interests.--If more than 1 security 
                        interest exists in the cotton 
                        represented by the electronic warehouse 
                        receipt, the priority of the security 
                        interests shall be determined by 
                        applicable Federal or State law.
                          (iii) Applicability.--This subsection 
                        is applicable to electronic cotton 
                        warehouse receipts and any other 
                        security interests covering cotton 
                        stored in a cotton warehouse, 
                        regardless of whether the warehouse is 
                        licensed under this Act.
          (3) Conditions for delivery on demand for cotton 
        stored.--A warehouse operator operating a warehouse 
        covered by this subsection, in the absence of a lawful 
        excuse, shall, without unnecessary delay, deliver the 
        cotton stored in the warehouse on demand made by the 
        person named in the record in the central filing system 
        as the holder of the receipt representing the cotton, 
        if the demand is accompanied by--
                  (A) an offer to satisfy the valid lien of a 
                warehouse operator, as determined by the 
                Secretary; and
                  (B) an offer to provide an acknowledgment in 
                a central filing system under this subsection, 
                if requested by the warehouse operator, that 
                the cotton has been delivered.

SEC. 12. CONDITIONS FOR DELIVERY OF AGRICULTURAL PRODUCTS.

    (a) Prompt Delivery.--In the absence of a lawful excuse, a 
warehouse operator shall, without unnecessary delay, deliver 
the agricultural product stored or handled in the warehouse on 
a demand made by--
          (1) the holder of the receipt for the agricultural 
        product; or
          (2) the person that deposited the product, if no 
        receipt has been issued.
    (b) Payment To Accompany Demand if Requested.--
          (1) In general.--Demand for delivery shall be 
        accompanied by payment of the accrued charges 
        associated with the storage of the agricultural product 
        if requested by the warehouse operator.
          (2) Special rule for cotton.--In the case of cotton 
        stored in a warehouse, the warehouse operator shall 
        provide a written request for payment of the accrued 
        charges associated with the storage of the cotton to 
        the holder of the receipt at the time at which demand 
        for the delivery of the cotton is made.
    (c) Surrender of Receipt.--When the holder of a receipt 
requests delivery of an agricultural product covered by the 
receipt, the holder shall surrender the receipt to the 
warehouse operator, in the manner prescribed by the Secretary, 
to obtain the agricultural product.
    (d) Cancellation of Receipt.--A warehouse operator 
shallcancel each receipt returned to the warehouse operator upon the 
delivery of the agricultural product for which the receipt was issued.

SEC. 13. SUSPENSION OR REVOCATION OF LICENSES.

    (a) In General.--After providing notice and an opportunity 
for a hearing in accordance with this section, the Secretary 
may suspend or revoke any license issued, or approval for an 
activity provided, under this Act--
          (1) for a material violation of, or failure to 
        comply, with any provision of this Act (including 
        regulations promulgated under this Act); or
          (2) on the ground that unreasonable or exorbitant 
        charges have been imposed for services rendered.
    (b) Temporary Suspension.--The Secretary may temporarily 
suspend a license or approval for an activity under this Act 
prior to an opportunity for a hearing for any violation of, or 
failure to comply with, any provision of this Act (including 
regulations promulgated under this Act).
    (c) Authority To Conduct Hearings.--The agency within the 
Department that is responsible for administering regulations 
promulgated under this Act shall have exclusive authority to 
conduct any hearing required under this section.
    (d) Judicial Review.--
          (1) Jurisdiction.--A final administrative 
        determination issued subsequent to a hearing may be 
        reviewable only in a district court of the United 
        States.
          (2) Procedure.--The review shall be conducted in 
        accordance with the standards set forth in section 
        706(2) of title 5, United States Code.

SEC. 14. PUBLIC INFORMATION.

    (a) In General.--The Secretary may release to the public--
          (1) the names, addresses, and locations of all 
        persons that have been licensed under this Act or that 
        have been approved to engage in an activity under this 
        Act;
          (2) the results of any investigation made, or hearing 
        conducted, under this Act; and
          (3) the names, addresses, and locations of all 
        persons with respect to which a license or approval has 
        been suspended or revoked under section 13, including 
        the reasons for the suspension or revocation.
    (b) Confidentiality.--Except as otherwise provided by law, 
an officer, employee, or agent of the Department shall not 
divulge confidential business information obtained during a 
warehouse examination or other function performed as part of 
the duties of the officer, employee, or agent under this Act.

SEC. 15. PENALTIES FOR NONCOMPLIANCE.

    If a person fails to comply with any requirement of this 
Act (including regulations promulgated under this Act), the 
Secretary may assess, on the record after an opportunity for a 
hearing, a civil penalty--
          (1) of not more than $25,000 per violation, if an 
        agricultural product is not involved in the violation; 
        or
          (2) of not more than 100 percent of the value of the 
        agricultural product, if an agricultural product is 
        involved in the violation.

SEC. 16. JURISDICTION AND ARBITRATION.

    (a) Federal Jurisdiction.--A district court of the United 
States shall have exclusive jurisdiction over any action 
brought under this Act without regard to the amount in 
controversy or the citizenship of the parties.
    (b) Arbitration.--Nothing in this Act prevents the 
enforceability of an agreement to arbitrate that would 
otherwise be enforceable under chapter 1 of title 9, United 
States Code.

SEC. 17. REGULATIONS.

    The Secretary shall promulgate such regulations as the 
Secretary considers necessary to carry out this Act.

SEC. 18. AUTHORIZATION OF APPROPRIATION.

    There are authorized to be appropriated such sums as are 
necessary to carry out this Act.

           *       *       *       *       *       *       *


                   RURAL ELECTRIFICATION ACT OF 1936


                                TITLE I

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

           *       *       *       *       *       *       *


SEC. 19. ENERGY GENERATION, TRANSMISSION, AND DISTRIBUTION FACILITIES 
                    EFFICIENCY GRANTS IN RURAL COMMUNITIES WITH 
                    EXTREMELY HIGH ENERGY COSTS.

    (a) In General.--The Secretary, acting through the Rural 
Utilities Service, may--
          (1) in coordination with State rural development 
        initiatives, make grants and loans to persons, States, 
        political subdivisions of States, and other entities 
        organized under the laws of States to develop, upgrade, 
        and improve the efficiency of energy generation, 
        transmission, and distribution facilities in 
        communities in which the average residential 
        expenditure for home energy is at least 275 percent of 
        the national average residential expenditure for home 
        energy (as determined by the Energy Information Agency 
        using the most recent data available);
          (2) make direct payments to the Denali Commission 
        established by the Denali Commission Act of 1998 (42 
        U.S.C. 3121 note; Public Law 105-277) to develop, 
        upgrade, and improve the efficiency of energy 
        generation, transmission, and distribution facilities 
        in communities described in paragraph (1); and
          (3) make grants to State entities, in existence as of 
        the date of enactment of this section, to establish and 
        support a revolving fund to provide a more cost-
        effective means of purchasing fuel where the fuel 
        cannot be shipped by means of surface transportation.
    (b) Authorization of Appropriations.--
          (1) In general.--There are authorized to be 
        appropriated to carry out this section $50,000,000 for 
        fiscal year 2001 and such sums as are necessary for 
        each subsequent fiscal year.
          (2) Limitation on planning and administrative 
        expenses.--Not more than 4 percent of the amounts made 
        available under paragraph (1) may be used for planning 
        and administrative expenses.

           *       *       *       *       *       *       *


       THE GRAIN STANDARDS AND WAREHOUSE IMPROVEMENT ACT OF 2000

           *       *       *       *       *       *       *



SEC. 302. CARRY FORWARD ADJUSTMENT.

    The amendments made by section 204(b)(10)(A) of the 
Agricultural Risk Protection Act of 2000 shall apply beginning 
with undermarketings of the 2001 crop of burley tobacco and 
with marketings of the 2002 crop of burley tobacco.

           *       *       *       *       *       *       *


                   AGRICULTURAL MARKETING ACT OF 1946


                                TITLE II

           *       *       *       *       *       *       *


    Sec. 203. * * *

           *       *       *       *       *       *       *

    [(e) To] (e) Development of New Markets._
          (1) In general.--To foster and assist in the 
        development of new or expanded markets (domestic and 
        foreign) and new and expanded uses and in the moving of 
        larger quantities of agricultural products through the 
        private marketing system to consumers in the United 
        States and abroad.
          (2) Fees and penalties.--
                  (A) In general.--In carrying out paragraph 
                (1), the Secretary may assess and collect 
                reasonable fees and late payment penalties to 
                mediate and arbitrate disputes arising between 
                parties in connection with transactions 
                involving agricultural products moving in 
                foreign commerce under the jurisdiction of a 
                multinational entity.
                  (B) Deposit.--Fees and penalties collected 
                under subparagraph (A) shall be deposited into 
                the account that incurred the cost of providing 
                the mediation or arbitration service.
                  (C) Availability.--Fees and penalties 
                collected under subparagraph (A) shall be 
                available to the Secretary without further Act 
                of appropriation and shall remain available 
                until expended to pay the expenses of the 
                Secretary for providing mediation and 
                arbitration services under this paragraph.
                  (D) No requirement for use of services.--No 
                person shall be required by the Secretary to 
                use the mediation and arbitration services 
                provided under this paragraph.

           *       *       *       *       *       *       *


              CONSOLIDATED FARM AND RURAL DEVELOPMENT ACT


                     TITLE III--AGRICULTURAL CREDIT

           *       *       *       *       *       *       *


    Sec. 306.(a)(1) The Secretary is also authorized to make or 
insure loans to associations

           *       *       *       *       *       *       *

    (20) Community facilities grant program for rural 
communities with extreme unemployment and severe economic 
depression.--
          (A) Definition of not employed rate.--In this 
        paragraph, the term ``not employed rate'', with respect 
        to a community, means the percentage of individuals 
        over the age of 18 who reside within the community and 
        who are ready, willing, and able to be employed but are 
        unable to find employment, as determined by the 
        department of labor of the State in which the community 
        is located.
          (B) Grant authority.--The Secretary may make grants 
        to associations, units of general local government, 
        nonprofit corporations, and Indian tribes (as defined 
        in section 4 of the Indian Self-Determination and 
        Education Assistance Act (25 U.S.C. 450b)) in a State 
        to provide the Federal share of the cost of developing 
        specific essential community facilities in rural 
        communities with respect to which the not employed rate 
        is greater than the lesser of--
                  (i) 500 percent of the average national 
                unemployment rate on the date of enactment of 
                this paragraph, as determined by the Bureau of 
                Labor Statistics; or
                  (ii) 200 percent of the average national 
                unemployment rate during the Great Depression, 
                as determined by the Bureau of Labor 
                Statistics.
          (C) Federal share.--Paragraph (19)(B) shall apply to 
        a grant made under this paragraph.
          (D) Authorization of appropriations.--There are 
        authorized to be appropriated to carry out this 
        paragraph $50,000,000 for fiscal year 2001 and such 
        sums as are necessary for each subsequent fiscal year, 
        of which not more than 5 percent of the amount made 
        available for a fiscal year shall be available for 
        community planning and implementation.
    (b) The service provided or made available through any such 
association * * *

           *       *       *       *       *       *       *

    Sec. 307. (a)(1) The period for repayment of loans under 
this subtitle shall not exceed forty years * * *

           *       *       *       *       *       *       *

    (6)(A) Notwithstanding any other provision of thissection, 
* * *
    (B) The authorities referred to in subparagraph (A) are--
          (i) the provisions of section 306(a)(1) relating to 
        loans for recreational developments and essential 
        community facilities,
          (ii) clause [(1) of section 310B(a)] section 
        310B(a)(1)(A), and

           *       *       *       *       *       *       *

    [Sec. 310B. (a) The] SEC. 310B. RURAL INDUSTRIALIZATION 
ASSISTANCE.
    (a) Loans for Private Business Enterprises.--
          (1) In general.--The Secretary may also make and 
        insure loans to public, private, or cooperative 
        organizations organized for profit or nonprofit, to 
        Indian tribes on Federal and State reservations or 
        other federally recognized Indian tribal groups, or to 
        individuals for the purposes [of (1) improving] of--
                  (A) improving, developing, or financing 
                business, industry, and employment and 
                improving the economic and environmental 
                climate in rural communities, including 
                pollution abatement and [control, (2) the 
                conservation, development, and use of] control;
                  (B) conserving, developing, and using water 
                for aquaculture purposes in rural [areas, (3) 
                reducing] areas;
                  (C) reducing the reliance on nonrenewable 
                energy resources by encouraging the development 
                and construction of solar energy systems, 
                including the modification of existing systems, 
                in rural [areas, and (4) to facilitate] areas; 
                and;
                  (D) facilitating economic opportunity for 
                industries undergoing adjustment from 
                terminated Federal agricultural price and 
                income support programs or increased 
                competition from foreign trade. [For the 
                purposes of] (2) Definition of solar energy.--
                In this subsection, the term ``solar energy'' 
                means energy derived from sources (other than 
                fossil fuels) and technologies included in the 
                Federal Nonnuclear Energy Research and 
                Development Act of 1974, as amended. [Such 
                loans,] (3) Applicability of certain 
                limitations._Loans under this subsection, when 
                originated, held, and serviced by other 
                lenders, may be guaranteed by the Secretary 
                under this section without regard to paragraphs 
                (1) and (4) of section 333. [As used in] (4) 
                Definition of aquaculture._In this subsection, 
                the term ``aquaculture'' means the culture or 
                husbandry of aquatic animals or plants by 
                private industry for commercial purposes 
                including the culture and growing of fish by 
                private industry for the purpose of creating or 
                augmenting publicly owned and regulated stocks 
                of fish. [No loan] (5) Loan limitation._No loan 
                may be made, insured, or guaranteed under this 
                subsection that exceeds $25,000,000 in 
                principal amount.
          (6) Eligibility for business and industry loans.--
        Notwithstanding section 381A(1), a loan may be made 
        under paragraph (1)(A) for a project or facility in a 
        city or town with a population in excess of 50,000 
        inhabitants, and its immediately adjacent urbanized 
        area, if the Secretary determines that--
                  (A) the project or facility will be used for 
                the processing of an agricultural commodity;
                  (B) the loan will be used for purchasing 
                supplies for, refurbishing, or equipping an 
                existing project or facility, and not for new 
                construction of a project or facility; and
                  (C) the primary economic beneficiaries of the 
                project or facility will be producers of 
                agricultural commodities.
    (b) Solid Waste Management Grants.--The Secretary may make 
grants to nonprofit organizations for the provision of regional 
technical assistance to local and regional governments and 
related agencies for the purpose of reducing or eliminating 
pollution of water resources and improving the planning and 
management of solid waste disposal facilities. Grants made 
under this paragraph for the provision of technical assistance 
shall be made for 100 percent of the cost of such assistance.

           *       *       *       *       *       *       *


SEC. 381E. RURAL DEVELOPMENT TRUST FUND

           *       *       *       *       *       *       *


    (d) Function Categories.--The function categories described 
in this subsection are the following:
          (1) Rural community facilities.--The rural community 
        development category consists of all amounts made 
        available for--
                  (A) community facility direct and guaranteed 
                loans under [section 306(a)(1)] paragraph (19) 
                or (20) of section 306(a); or

           *       *       *       *       *       *       *

          (3) Rural business and cooperative development.--The 
        rural business and cooperative development category 
        consists of all amounts made available for--

           *       *       *       *       *       *       *

                  (B) business and industry direct and 
                guaranteed loans under section [310B(a)(1)] 
                section 310B(a)(1)(A), or

           *       *       *       *       *       *       *


                        STATE MEDIATION PROGRAMS


                   TITLE V--STATE MEDIATION PROGRAMS


      Subtitle A--Matching Grants for State Mediation Programs . . .

           *       *       *       *       *       *       *


    Sec. 506. There are authorized to be appropriated to carry 
out this subtitle $7,500,000 for each of the fiscal years 1988 
through [2000] 2005.

           *       *       *       *       *       *       *


                      CHILD NUTRITION ACT OF 1966


[SEC. 17. SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS, 
                    AND CHILDREN.]

SEC. 17. CHILD AND ADULT CARE FOOD PROGRAM.

    Sec. 17. (a) Congress finds that substantial numbers of 
pregnant

           *       *       *       *       *       *       *

    (d)(1) Participation in the program under this section 
shall be limited to pregnant, postpartum, and breastfeeding 
women, infants, and children from low-income families who are 
determined by a competent professional authority to be at 
nutritional risk

           *       *       *       *       *       *       *

    (2)(B) For the purpose of determining income eligibility 
under this section, any State agency may choose to exclude from 
income--
          (ii) any cost-of-living allowance provided under 
        section 405 of title 37, United States Code, to a 
        member of a uniformed service who is on duty outside 
        the [continental] contiguous States of the United 
        States

           *       *       *       *       *       *       *

    (r) Demonstration Project Relating to Use of the WIC 
Program for Identification and Enrollment of Children in 
Certain Health Programs.--
          (1) In general.--In accordance with paragraph (2), 
        the Secretary shall establish a demonstration project 
        in [at least 20 local agencies] not more than 20 local 
        agencies in one State under which costs of nutrition 
        services and administration

           *       *       *       *       *       *       *


              RICHARD B. RUSSELL NATIONAL SCHOOL LUNCH ACT


SEC. 17. CHILD AND ADULT CARE FOOD PROGRAM.

    (a)(1) Grant authority.--The Secretary may carry out a 
program to assist States through grants-in-aid and other means 
to initiate and maintain nonprofit food service programs for 
children in institutions providing child care

           *       *       *       *       *       *       *

    (6) Eligibility criteria.--No institution shall be eligible 
to participate in the program unless it satisfies the following 
criteria:
          (C)(ii) in the case of a sponsoring organization, the 
        organization shall employ an appropriate number of 
        monitoring personnel based on the number and 
        characteristics of child care centers and family or 
        group day care homes sponsored by the organization, as 
        approved by the State (in accordance with regulations 
        promulgated by the Secretary), to ensure effective 
        oversight of the operations of the child care centers 
        and family or group day care homes; [and]

           *       *       *       *       *       *       *


                                  
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