[Senate Report 106-391]
[From the U.S. Government Publishing Office]
Calendar No. 767
106th Congress Report
SENATE
2d Session 106-391
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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]
* * * * * * *