[House Report 107-111]
[From the U.S. Government Publishing Office]



107th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    107-111

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



 
   RESPONDING TO THE CONTINUING ECONOMIC CRISIS ADVERSELY AFFECTING 
                    AMERICAN AGRICULTURAL PRODUCERS

                                _______
                                

 June 26, 2001.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

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

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                        [To accompany H.R. 2213]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Agriculture, to whom was referred the bill 
(H.R. 2213) to respond to the continuing economic crisis 
adversely affecting American agricultural producers, having 
considered the same, report favorably thereon with an amendment 
and recommend that the bill as amended do pass.
    The amendment is as follows:
    Strike all after the enacting clause and insert the 
following:

SECTION 1. MARKET LOSS ASSISTANCE.

    (a) Assistance Authorized.--The Secretary of Agriculture (referred 
to in this Act as the ``Secretary'') shall, to the maximum extent 
practicable, use $4,622,240,000 of funds of the Commodity Credit 
Corporation to make a market loss assistance payment to owners and 
producers on a farm that are eligible for a final payment for fiscal 
year 2001 under a production flexibility contract for the farm under 
the Agriculture Market Transition Act (7 U.S.C. 7201 et seq.).
    (b) Amount.--The amount of assistance made available to owners and 
producers on a farm under this section shall be proportionate to the 
amount of the total contract payments received by the owners and 
producers for fiscal year 2001 under a production flexibility contract 
for the farm under the Agricultural Market Transition Act.

SEC. 2. SUPPLEMENTAL OILSEEDS PAYMENT.

    The Secretary shall use $423,510,000 of funds of the Commodity 
Credit Corporation to make a supplemental payment under section 202 of 
the Agricultural Risk Protection Act of 2000 (Public Law 106-224; 7 
U.S.C. 1421 note) to producers of the 2000 crop of oilseeds that 
previously received a payment under such section.

SEC. 3. SUPPLEMENTAL PEANUT PAYMENT.

    The Secretary shall use $54,210,000 of funds of the Commodity 
Credit Corporation to provide a supplemental payment under section 
204(a) of the Agricultural Risk Protection Act of 2000 (Public Law 106-
224; 7 U.S.C. 1421 note) to producers of quota peanuts or additional 
peanuts for the 2000 crop year that previously received a payment under 
such section. The Secretary shall adjust the payment rate specified in 
such section to reflect the amount made available for payments under 
this section.

SEC. 4. SUPPLEMENTAL TOBACCO PAYMENT.

    (a) Supplemental Payment.--The Secretary shall use $129,000,000 of 
funds of the Commodity Credit Corporation to provide a supplemental 
payment under section 204(b) of the Agricultural Risk Protection Act of 
2000 (Public Law 106-224; 7 U.S.C. 1421 note) to eligible persons (as 
defined in such section) that previously received a payment under such 
section.
    (b) Special Rule for Georgia.--The Secretary may make payments 
under this section to eligible persons in Georgia only if the State of 
Georgia agrees to use the sum of $13,000,000 to make payments at the 
same time, or subsequently, to the same persons in the same manner as 
provided for the Federal payments under this section, as required by 
section 204(b)(6) of the Agricultural Risk Protection Act of 2000.

SEC. 5. SUPPLEMENTAL WOOL AND MOHAIR PAYMENT.

    The Secretary shall use $16,940,000 of funds of the Commodity 
Credit Corporation to provide a supplemental payment under section 814 
of the Agriculture, Rural Development, Food and Drug Administration, 
and Related Agencies Appropriations Act, 2001 (as enacted by Public Law 
106-387), to producers of wool, and producers of mohair, for the 2000 
marketing year that previously received a payment under such section. 
The Secretary shall adjust the payment rate specified in such section 
to reflect the amount made available for payments under this section.

SEC. 6. SUPPLEMENTAL COTTONSEED ASSISTANCE.

    The Secretary shall use $84,700,000 of funds of the Commodity 
Credit Corporation to provide supplemental assistance under section 
204(e) of the Agricultural Risk Protection Act of 2000 (Public Law 106-
224; 7 U.S.C. 1421 note) to producers and first-handlers of the 2000 
crop of cottonseed that previously received assistance under such 
section.

SEC. 7. SPECIALTY CROPS.

    (a) Base State Grants.--The Secretary shall use $26,000,000 of 
funds of the Commodity Credit Corporation to make grants to the several 
States and the Commonwealth of Puerto Rico to be used to support 
activities that promote agriculture. The amount of the grant shall be--
          (1) $500,000 to each of the several States; and
          (2) $1,000,000 to the Commonwealth of Puerto Rico.
    (b) Grants for Value of Production.--The Secretary shall use 
$133,400,000 of funds of the Commodity Credit Corporation to make a 
grant to each of the several States in an amount that represents the 
proportion of the value of specialty crop production in the State in 
relation to the national value of specialty crop production, as 
follows:
          (1) California, $63,320,000.
          (2) Florida, $16,860,000.
          (3) Washington, $9,610,000.
          (4) Idaho, $3,670,000.
          (5) Arizona, $3,430,000.
          (6) Michigan, $3,250,000.
          (7) Oregon, $3,220,000.
          (8) Georgia, $2,730,000.
          (9) Texas, $2,660,000.
          (10) New York, $2,660,000.
          (11) Wisconsin, $2,570,000.
          (12) North Carolina, $1,540,000.
          (13) Colorado, $1,510,000.
          (14) North Dakota, $1,380,000.
          (15) Minnesota, $1,320,000.
          (16) Hawaii, $1,150,000.
          (17) New Jersey, $1,100,000.
          (18) Pennsylvania, $980,000.
          (19) New Mexico, $900,000.
          (20) Maine, $880,000.
          (21) Ohio, $800,000.
          (22) Indiana, $660,000.
          (23) Nebraska, $640,000.
          (24) Massachusetts,$640,000.
          (25) Virginia, $620,000.
          (26) Maryland, $500,000.
          (27) Louisiana, $460,000.
          (28) South Carolina, $440,000.
          (29) Tennessee, $400,000.
          (30) Illinois, $400,000.
          (31) Oklahoma, $390,000.
          (32) Alabama, $300,000.
          (33) Delaware, $290,000.
          (34) Mississippi, $250,000.
          (35) Kansas, $210,000.
          (36) Arkansas, $210,000.
          (37) Missouri, $210,000.
          (38) Connecticut, $180,000.
          (39) Utah, $140,000.
          (40) Montana, $140,000.
          (41) New Hampshire, $120,000.
          (42) Nevada, $120,000.
          (43) Vermont, $120,000.
          (44) Iowa, $100,000.
          (45) West Virginia, $90,000.
          (46) Wyoming, $70,000.
          (47) Kentucky, $60,000.
          (48) South Dakota, $40,000.
          (49) Rhode Island, $40,000.
          (50) Alaska, $20,000.
    (c) Specialty Crop Priority.--As a condition on the receipt of a 
grant under this section, a State shall agree to give priority to the 
support of specialty crops in the use of the grant funds.
    (d) Specialty Crop Defined.--In this section, the term ``specialty 
crop'' means any agricultural crop, except wheat, feed grains, 
oilseeds, cotton, rice, peanuts, and tobacco.

SEC. 8. COMMODITY ASSISTANCE PROGRAM.

    The Secretary shall use $10,000,000 of funds of the Commodity 
Credit Corporation to make a grant to each of the several States to be 
used by the States to cover direct and indirect costs related to the 
processing, transportation, and distribution of commodities to eligible 
recipient agencies. The grants shall be allocated to States in the 
manner provided under section 204(a) of the Emergency Food Assistance 
Act of 1983 (7 U.S.C. 7508(a)).

SEC. 9. TECHNICAL CORRECTION REGARDING INDEMNITY PAYMENTS FOR COTTON 
                    PRODUCERS.

    (a) Conditions on Payment to State.--Subsection (b) of section 1121 
of the Agriculture, Rural Development, Food and Drug Administration, 
and Related Agencies Appropriations Act, 1999 (as contained in section 
101(a) of division A of Public Law 105-277 (7 U.S.C. 1421 note), and as 
amended by section 754 of the Agriculture, Rural Development, Food and 
Drug Administration, and Related Agencies Appropriations Act, 2001 (as 
enacted by Public Law 106-387; 114 Stat. 1549A-42), is amended to read 
as follows:
    ``(b) Conditions on Payment to State.--The Secretary of Agriculture 
shall make the payment to the State of Georgia under subsection (a) 
only if the State--
          ``(1) contributes $5,000,000 to the indemnity fund and agrees 
        to expend all amounts in the indemnity fund by not later than 
        January 1, 2002 (or as soon as administratively practical 
        thereafter), to provide compensation to cotton producers as 
        provided in such subsection;
          ``(2) requires the recipient of a payment from the indemnity 
        fund to repay the State, for deposit in the indemnity fund, the 
        amount of any duplicate payment the recipient otherwise 
        recovers for such loss of cotton, or the loss of proceeds from 
        the sale of cotton, up to the amount of the payment from the 
        indemnity fund; and
          ``(3) agrees to deposit in the indemnity fund the proceeds of 
        any bond collected by the State for the benefit of recipients 
        of payments from the indemnity fund, to the extent of such 
        payments.''.
    (b) Additional Disbursements From the Indemnity Fund.--Subsection 
(d) of such section is amended to read as follows:
    ``(d) Additional Disbursement to Cotton Ginners.--The State of 
Georgia shall use funds remaining in the indemnity fund, after the 
provision of compensation to cotton producers in Georgia under 
subsection (a) (including cotton producers who file a contingent claim, 
as defined and provided in section 5.1 of chapter 19 of title 2 of the 
Official Code of Georgia), to compensate cotton ginners (as defined and 
provided in such section) that--
          ``(1) incurred a loss as the result of--
                  ``(A) the business failure of any cotton buyer doing 
                business in Georgia; or
                  ``(B) the failure or refusal of any such cotton buyer 
                to pay the contracted price that had been agreed upon 
                by the ginner and the buyer for cotton grown in Georgia 
                on or after January 1, 1997, and had been purchased or 
                contracted by the ginner from cotton producers in 
                Georgia;
          ``(2) paid cotton producers the amount which the cotton 
        ginner had agreed to pay for such cotton received from such 
        cotton producers in Georgia; and
          ``(3) satisfy the procedural requirements and deadlines 
        specified in chapter 19 of title 2 of the Official Code of 
        Georgia applicable to cotton ginner claims.''.
    (c) Conforming Amendment.--Subsection (c) of such section is 
amended by striking ``Upon the establishment of the indemnity fund, and 
not later than October 1, 1999, the'' and inserting ``The''.

SEC. 10. INCREASE IN PAYMENT LIMITATIONS REGARDING LOAN DEFICIENCY 
                    PAYMENTS AND MARKETING LOAN GAINS.

    Notwithstanding section 1001(2) of the Food Security Act of 1985 (7 
U.S.C. 1308(1)), the total amount of the payments specified in section 
1001(3) of that Act that a person shall be entitled to receive for one 
or more contract commodities and oilseeds under the Agricultural Market 
Transition Act (7 U.S.C. 7201 et seq.) during the 2001 crop year may 
not exceed $150,000.

SEC. 11. TIMING OF, AND LIMITATION ON, EXPENDITURES.

    (a) Deadline for Expenditures.--All expenditures required by this 
Act shall be made not later than September 30, 2001. Any funds made 
available by this Act and remaining unexpended by October 1, 2001, 
shall be deemed to be unexpendable, and the authority provided by this 
Act to expend such funds is rescinded effective on that date.
    (b) Total Amount of Expenditures.--The total amount expended under 
this Act may not exceed $5,500,000,000. If the payments required by 
this Act would result in expenditures in excess of such amount, the 
Secretary shall reduce such payments on a pro rata basis as necessary 
to ensure that such expenditures do not exceed such amount.

SEC. 12. REGULATIONS.

    (a) Promulgation.--As soon as practicable after the date of the 
enactment of this Act, the Secretary and the Commodity Credit 
Corporation, as appropriate, shall promulgate such regulations as are 
necessary to implement this Act and the amendments made by this Act. 
The promulgation of the regulations and administration of this Act 
shall be made without regard to--
          (1) the notice and comment provisions of section 553 of title 
        5, United States Code;
          (2) the Statement of Policy of the Secretary of Agriculture 
        effective July 24, 1971 (36 Fed. Reg. 13804), relating to 
        notices of proposed rulemaking and public participation in 
        rulemaking; and
          (3) chapter 35 of title 44, United States Code (commonly 
        known as the ``Paperwork Reduction Act'').
    (b) Congressional Review of Agency Rulemaking.--In carrying out 
this section, the Secretary shall use the authority provided under 
section 808 of title 5, United States Code.

                           Brief Explanation

    H.R. 2213 will provide assistance to U.S. agricultural 
producers, most of which is generally based on assistance 
provided for the 2000 crop year in the Agricultural Risk 
Protection Act of 2000 (Pub. L. 106-224) (``ARPA''). The bill 
limits total expenditures to $5.5 billion, all of which occur 
in fiscal year 2001. If expenditures under any section of the 
bill would result in spending above $5.5 billion, the Secretary 
of Agriculture is required to make a pro rata reduction in such 
payments in order to ensure that total expenditures in fiscal 
year 2001 do not exceed $5.5 billion.
    The following supplemental expenditures represent an 84.7% 
prorate from assistance received in 2000--
          $4,622,240,000 for supplemental market loss 
        assistance payments to individuals receiving an 
        Agricultural Market Transition Act (``AMTA'') payment.
          $423,510,000 to producers of 2000 crop of oilseeds in 
        accordance with ARPA.
          $54,210,000 to producers of peanuts in accordance 
        with ARPA.
          $129,000,000 to tobacco quota holders in accordance 
        with ARPA.
                  Special rule for Georgia: no payments will be 
                made unless the State of Georgia agrees to use 
                $13,000,000 to make payments in the same 
                manner.
          $16,940,000 to producers of wool and mohair under the 
        same terms as was provided in the fiscal year 2001 
        Agriculture Appropriations Act.
          $84,700,000 to producers and first-handlers of 
        cottonseed in accordance with ARPA.
          $159,400,000 in assistance to specialty crops in the 
        following manner:
                  $1,000,000 grant to Puerto Rico to promote 
                agriculture.
                  $500,000 grants to each State to promote 
                agriculture.
                  Grants to each state totaling $133,400,000 
                based on the value of production of specialty 
                crops in relation to the national value of 
                specialty crop production.
                  States receiving these grants must agree to 
                give a priority to specialty crops as a 
                condition of the grant.
          $10,000,000 to make grants to States for direct and 
        indirect costs related to the processing, 
        transportation, and distribution of commodities.
    The Act also:
          Makes a technical change to the FY 1999 Agriculture 
        Appropriations Act to allow the State of Georgia to use 
        the indemnity funds already provided for certain 
        producers that suffered economic losses in 1998 and 
        1999.
          Limits total payments to a person for contract 
        commodities and oilseeds under AMTA to $150,000.
          Requires that all expenditures under this Act be made 
        by September 30, 2001.

                            Purpose and Need

    American agriculture is in an economic crisis. In 2000, 
crop prices were at a 27-year low for soybeans, a 25-year low 
for cotton, a 14-year low for wheat and corn and an 8-year low 
for rice. Over the past three years, net cash income fell in 
real dollars to its lowest point since the Great Depression. 
The current farm recession, in its fourth year, ranks among the 
deepest in our nation's history, along with the Great 
Depression, the post-World War I and II recessions, and the 
financial ruin of the 1980s.
    For 2001, most projections show very little improvement in 
commodity prices with production expenses rising to record 
levels. Looking back to when Congress passed the Federal 
Agriculture Improvement and Reform Act of 1996, no one on 
either side of the aisle predicted the current malaise of high 
costs and low commodity prices. In fact, today's prices for 
wheat, corn and soybeans are 31 percent lower than the U.S. 
Department of Agriculture's (``USDA'') projected prices at the 
time the legislation was enacted.
    There are many factors that have contributed to this dismal 
situation that are beyond the control of individual producers. 
American agriculture depends heavily on the strength of foreign 
markets for returns on commodity production. In recent months, 
however, worldwide demand for U.S. products has not met 
expectations for a variety of reasons. Repercussions are still 
being felt from the Asian economic crisis that began three 
years ago. Further, three years of worldwide good weather have 
created commodity surpluses all around the globe. Compounding 
this situation for U.S. producers is the strength of the dollar 
that has contributed to a substantial increase in the relative 
cost of U.S. commodities. In fact, USDA estimates that the 
value of the dollar is up 25 percent relative to our customers' 
currencies and up 40 percent relative to our major competitors' 
currencies.
    In addition, domestic producers continue to compete on an 
uneven international playing field in light of trade barriers. 
Despite some progress in lowering trade barriers through the 
World Trade Organization, the fact remains that the average 
tariff on U.S. farm products in other countries is 62 percent, 
while the average U.S. tariff on goods coming into the U.S. is 
approximately 12 percent. Beyond high tariffs, our farmers also 
face the daunting challenge of competing with high foreign 
subsidies. For example, the average subsidy level in the 
European Union during 1997 to 1999 was $342 per acre, while the 
average subsidy level in the U.S. was only $43 per acre.
    The effect of low commodity prices has been magnified in 
the 2001 crop year by skyrocketing energy costs. Between 1999 
and 2000, U.S. producers incurred an additional $2.4 billion in 
fuel costs. This is a 40 percent increase from years past. For 
the 2001 crop year, energy costs are expected to contribute to 
a $1.5 billion increase in production expenses. Diesel prices 
for 2001 are expected to average $1.50 per gallon which is a 50 
percent increase from last year. In addition, last year's 
rising natural gas prices have fueled sharply increased costs 
for irrigation and nitrogen fertilizer.
    In each of the last three years, Congress has responded to 
the needs of American agriculture with emergency assistance. 
This money has provided a critical source of income for 
producers of contract crops and soybeans. Indeed, had Congress 
not provided nearly $25 billion in supplemental assistance to 
farmers in the last three years, tens of thousands of farmers 
would have been forced out of business, having a devastating 
impact on rural America. Without additional support in 2001, 
total net returns for these producers are expected to decline 
significantly from 2000 levels in light of continued anemic 
commodity prices and higher costs of production. Accordingly, 
additional economic assistance for producers in the 2001 crop 
years is justified.
    Importantly, the supplemental assistance to farmers and 
ranchers that this legislation provides is fully contemplated 
by and is in compliance with the Budget Resolution passed by 
Congress earlier this year.
    Providing income assistance for the 2001 crop year is 
constrained by USDA's ability to meet the September 30, 2001 
deadline for disbursing payments. Even in the fourth year of 
annual economic loss assistance, USDA remains unable to improve 
its use of producer data to enhance program delivery criteria. 
On several related fronts USDA is doing an inadequate job in 
ensuring that their data information systems meet the direction 
of Congress and the needs of producers.
    The Committee is disappointed with the manner in which USDA 
has implemented Section 121(c) of ARPA. Section 121 requires 
the Farm Service Agency (FSA) and the Risk Management Agency 
(RMA) to reconcile producer information of the two agencies. 
The Committee is concerned that RMA and FSA will not meet the 
time deadline for reconciling information required by Section 
121. One year has elapsed since the enactment of ARPA and RMA 
and FSA have not modified their data information systems to 
capture farm, unit, acreage, and production information in a 
format that is reconcilable.
    On a related note, RMA has contracted with the Center for 
Agribusiness Excellence at Tarleton State University as 
directed by ARPA. However, FSA has failed to provide needed 
producer information. The Committee expects the Secretary to 
require FSA to make available all relevant information in the 
same manner as RMA to the Center for Agribusiness Excellence so 
that it can proceed in reconciling producer information. The 
Committee believes that reconciling this information will 
benefit taxpayers by helping to identify waste, fraud and 
abuse, and assist producers through the identification of 
program deficiencies. In addition, it should allow FSA and RMA 
to improve service and provide policy makers with data needed 
to make decisions by providing reliable and up-to-date 
information. Most importantly, the Committee expects that this 
system can assist USDA by developing a paradigm on how to 
utilize a comprehensive and compatible information system.
    Beyond providing immediate economic assistance to producers 
through this legislation, the Committee also expects USDA to 
address several other important issues administratively using 
existing authorities.
    First, the Committee is very concerned about the delay in 
delivering crop insurance and disaster assistance to producer 
members of the Southern Minnesota Sugar Beet Cooperative. 
Approximately 600 Minnesota sugar beet producers suffered 
losses on their 2000 crop year crops due to freeze damage. The 
losses associated with the freeze threaten hundreds of farm 
families, the cooperative, and the jobs the cooperative 
provides.
    The Committee understands that despite a determination by 
RMA that the losses are insurable (MGR Bulletin 01-010, dated 
March 2, 2001), crop insurance claims have still not been 
satisfied. Further, since eligibility for disaster assistance 
(authorized under Section 815 of the Agriculture Appropriations 
Bill for FY2001) is made administratively contingent upon loss 
determinations made under the Federal Crop Insurance Program, 
producers have not received this assistance either, even though 
authority for this program expires on September 30, 2001.
    The Committee believes that the delay by RMA and FSA is 
unacceptable and expects the two agencies to take immediate 
steps to provide sugar beet producers with crop insurance and 
disaster assistance.
    The Committee is aware that the RMA is not providing loss 
adjustment information that the private insurance providers 
have requested, citing that loss adjustments are not RMA's 
responsibility. The Committee notes, however, that the cause of 
the problem--the failure to correct a flaw in the sugar beet 
policy that was first revealed 16 years ago in a successful 
lawsuit against the FCIC--is the RMA's responsibility.
    Further, the Committee understands the reluctance of the 
private insurance providers to adjust the claims for fear that 
any losses improperly paid may not be reinsured by RMA. 
However, disagreements over the Standard Reinsurance Agreement 
(SRA)--a contract betweenRMA and private insurance providers--
should be resolved between the parties to the SRA and should never 
prejudice or delay the claim of a producer who is not privy to that 
contract.
    Nevertheless, given the circumstances, the Committee 
expects RMA to work cooperatively and without further delay 
with the private insurance providers and producer and 
cooperative representatives to satisfy producer claims within a 
period of time that will allow FSA to make disaster payments on 
these claims before September 30, 2001. In any case, the 
Committee expects that under no circumstances will FSA fail to 
make disaster payments to these producers before authority to 
do so expires September 30, 2001.
    As the Chief Judge of the 8th Circuit U.S. Court of Appeals 
made clear in a similar case, the fact that sugar beets were 
processed does not negate the fact that there is an insurable 
loss for which the insured is entitled to receive an indemnity, 
nor is it dispositive as to how the loss should ultimately be 
calculated. Because this principle is as applicable to disaster 
assistance as it is to crop insurance, the Committee sees no 
reason for FSA to wait for a decision by RMA. The Committee 
would note that since affected sugar producers are all members 
of the same cooperative and share equally in patronage 
dividends, an aggregate payment could be made to the 
cooperative on the condition that such a payment would be 
equitably distributed to producer members.
    Second, the Committee is concerned about the increasing 
risk to our nation's food supply from plant and animal pests 
and diseases. Recent outbreaks of Karnal bunt in Texas, 
Pierce's disease in California, citrus canker in Florida and 
the threat of Foot and Mouth disease to our livestock industry 
has the Committee concerned that the Secretary's existing 
authority to declare emergencies may be insufficient to 
proactively address these critical emergencies. The Committee 
urges the Secretary to use existing authority to rapidly 
respond to pest and disease outbreaks and provide producers and 
agribusinesses whose income has been affected by such outbreaks 
with timely compensation.
    The Committee recognizes that the Animal and Plant Health 
Inspection Service plays a critical role in protecting the 
agricultural sector in the United States from outbreaks of 
foreign plant and animal diseases and invasive pests and in 
containing and mitigating the deleterious effects of outbreaks 
when they do occur.
    The recent outbreak of Food and Mouth Disease in the United 
Kingdom and in Europe has highlighted the critical need for 
increased investment of resources in the Animal and Plant 
Health Inspection Service as well as the need for closer 
coordination and collaboration between APHIS and other agencies 
and jurisdictions, such as FEMA, state governments, and local 
governments, that might find themselves involved in the 
containment of plant and animal diseases and pests.
    The Committee urges the Department of Agriculture to 
conduct a top to bottom review of its ability to respond 
quickly and adequately to the outbreak of catastrophic plant 
and animal diseases and invasive pests. For example, due to the 
concentrated nature of livestock operations in many states such 
as North Carolina, an outbreak of a disease like Foot and Mouth 
Disease would spread rapidly, threatening not only a multi-
billion dollar livestock industry, but the entire state 
economy.
    In its re-examination of farm policy and in writing a farm 
bill in the 107th Congress, the Committee will closely examine 
ways in which to increase the resources available to APHIS and 
also possibilities to improve the capacity of APHIS to 
adequately respond to potential threats and outbreaks that 
threaten to undermine and damage the US agricultural sector.
    Third, the Committee also notes that the Department has not 
yet expended the funds made available by section 203(e) of ARPA 
with regard to Pierce's Disease. The $25 million in funding 
made available by section 203(e) was provided to USDA to 
compensate growers for losses due to the plum pox virus, citrus 
canker, and Pierce's disease, and USDA has expended the funds 
to compensate growers with respect to the plum pox virus and 
citrus canker. Citrus canker is a devastating disease affecting 
citrus production and immediate efforts to control and 
eradicate the disease are necessary to prevent spread of citrus 
canker to other citrus-growing areas. The Committee applauds 
the U.S. Secretary of Agriculture's efforts to enable crucial 
eradication and control measures to continue and encourages 
these actions to move toward completion.
    With the remaining $7.14 million of the funds made 
available by section 203(e) of ARPA, the Committee expects USDA 
to expend these funds in a manner that: (1) is consistent with 
section 261(a)(2) of ARPA; and (2) compensates growers for 
economic losses associated with the destruction of grape vines 
due to Pierce's disease without limits of payments to 
individual growers and without grower eligibility requirements 
based on gross income. The Committee notes that USDA has the 
authority to enter into cooperative agreements or contracts 
with state agencies, such as the California Department of Food 
and Agriculture, and urges the Department to expedite this 
process in order to accomplish the goals of section 203(e) of 
ARPA in a timely manner.
    The Committee also urges the Secretary to reassess the 
valuation of tangerines in its final rule on citrus canker 
commercial compensation recognizing the discrepancy in values 
between the average price for tangerines and that of Valencia 
oranges. Using existing funds designated to compensate growers 
for losses due to citrus canker, the Secretary is encouraged to 
issue payments to tangerine growers who have lost their groves 
due to citrus canker based on the recalculated value of 
tangerines.
    Finally, the Committee urges the Secretary to utilize the 
authority of section 815 of the FY 2001 agricultural 
appropriations act to provide assistance to orchardists and 
tree farmers who have planted trees for commercial purposes but 
have lost the trees as a result of a natural disaster for the 
2000 crop. The assistance provided should reimburse a portion 
of the cost of replanting lost trees.

                           Section-by-Section


Section 1. Market loss assistance

    Section 1 requires the Secretary of Agriculture to use 
$4,622,240,000 of funds of the Commodity Credit Corporation to 
make a market loss assistance payment to owners and producers 
on a farm that are eligible for a final payment for fiscal year 
2001 under a production flexibility contract for the farm under 
the Agriculture Market Transition Act.

Section 2. Supplemental oilseeds payment

    Section 2 requires the Secretary to use $423,510,000 of the 
funds of the Commodity Credit Corporation to make supplemental 
payments under section 202 of Agricultural Risk Protection Act 
(ARPA) to producers of the 2000 crop of oilseeds that 
previously received a payment .

Section 3. Supplemental peanut payment

    Section 3 requires the Secretary to use $54,210,000 of the 
funds of the Commodity Credit Corporation to provide 
supplemental payments under section 204(a) of ARPA to producers 
of quota or additional peanuts for the 2000 crop year that 
previously received a payment.

Section 4. Supplemental tobacco payment

    Section 4 requires the Secretary to use $129,000,000 of the 
funds of the Commodity Credit Corporation to provide 
supplemental payments under section 204(b) of ARPA to eligible 
persons that previously received a payment. The section also 
provides that the Secretary may make payments to Georgia 
producers only if the State of Georgia makes $13 million in 
payments to such producers.

Section 5. Supplemental wool and mohair payment

    Section 5 requires the Secretary to use $16,940,000 of the 
funds of the Commodity Credit Corporation to provide a 
supplemental payment under section 814 of the Agriculture, 
Rural Development, Food and Drug Administration, and Related 
Agencies Appropriations Act for Fiscal Year 2001 to producers 
of wool and mohair for the 2000 marketing year that previously 
received a payment. The payment rate will be adjusted to 
reflect the $16,940,000 made available for payments.

Section 6. Supplemental cottonseed assistance

    Section 6 requires the Secretary to use $84,700,000 of 
funds of the Commodity Credit Corporation to provide 
supplemental assistance under section 204(e) of ARPA to 
producers and first-handlers of the 2000 crop of cottonseed 
that previously received assistance.

Section 7. Specialty crops

    Subsection 7(a) requires the Secretary to use $26 million 
of the funds of the Commodity Credit Corporation to make a 
grant in the amount of $500,000 to each of the several States 
and $1,000,000 to Puerto Rico to support activities that 
promote agriculture.
    Subsection 7(b) requires the Secretary to use $133,400,000 
of the funds of the Commodity Credit Corporation to make a 
grant to each State in an amount that represents the proportion 
of the value of specialty crop production in the State in 
relation to the national value of specialty crop production as 
specified in the legislation.
    Subsection 7(c) requires the States to give priority to the 
support of specialty crops in the use of the grant funds as a 
condition on the receipt of a grant.
    Subsection 7(d) defines specialty crop to mean any crop of 
an agricultural commodity except wheat, feed grains, oilseeds, 
cotton, rice, peanuts, and tobacco.
    The Committee expects that the grants provided in this Act 
to the States will be used to assist growers of specialty 
crops. The Committee expects that the States will use all means 
necessary to ensure that specialty crops are given the priority 
established in this Act in the use of these funds. Specialty 
crops need these additional resources because of the many 
different and difficult circumstances facing specialty crop 
growers resulting from disease, low prices, and lack of funding 
for research, promotion, and inspection, to name just a few. 
For example, many growers have indicated interest in using this 
funding for value-added research, such as that envisioned by 
Arkansas State University. The Committee expects these funds to 
be in addition to any funds already provided by the States to 
support agriculture and expects the States to maintain their 
current efforts to support agriculture.

Section 8. Commodity assistance program

    Section 8 requires the Secretary to use $10,000,000 of 
funds of the Commodity Credit Corporation to make grants to 
States to pay direct and indirect costs related to the 
processing, transportation, and distribution of commodities 
under section 204(a) of the Emergency Food Assistance Act of 
1983 (EFAP).

Section 9. Technical correction regarding indemnity payments for cotton 
        producers

    Section 9 amends subsection (b) of section 1121 of the 
Agriculture, Rural Development, Food and Drug Administration, 
and Related Agencies Appropriations Act for Fiscal year 1999 as 
previously amended to allow the State of Georgia to use the 
indemnity funds already provided for cotton producers and 
ginners that suffered economic losses due to the failure of a 
warehouse.

Section 10. Increase in payment limitations regarding loan deficiency 
        payments and marketing loan gains

    Section 10 limits marketing loan gains and loan deficiency 
payments for 2001 crops to $150,000 per person.

Section 11. Timing of, and limitation on, expenditures

    Section 12 requires that all expenditures required by this 
Act will be made before September 30, 2001. The total amount 
that can be expended is $5,500,000,000. If the payments 
required by section 1 through 11 would result in expenditures 
in excess of $5,500,000,000, the Secretary must reduce the 
payments on a pro rata basis to ensure that the expenditures do 
not exceed $5,500,000,000.

Section 12. Regulations

    Section 13 requires the Secretary and the CCC, whichever is 
appropriate, to promulgate regulations to implement this Act 
without regard to notice and comment rulemaking.

                        Committee Consideration

    The Committee on Agriculture met, pursuant to notice, with 
a quorum present, on June 20, 2001, to consider H.R. 2213, a 
bill to respond to the continuing economic crisis adversely 
affecting American agricultural producers.
    Chairman Combest made a brief opening statement and then 
recognized Mr. Stenholm for remarks.
    After opening remarks and brief discussion of the bill, the 
Chairman, without objection, placed H.R. 2213 before the 
Committee to be open for amendment at any point.
    Mr. Stenholm was then recognized to offer and explain an 
Amendment in the Nature of a Substitute on behalf of himself 
and Mr. Boehner that limited the overall assistance to $5.5 
billion in Fiscal year 2001 funds.
    Mr. Chambliss was recognized to offer and explain an 
amendment to the Substitute Amendment that was a technical 
correction to the tobacco payment allocation under the Tobacco 
Settlement Agreement of the State of Georgia which allows for 
matching payments to producers. Discussion occurred and the 
amendment was adopted, by a voice vote.
    Mr. Condit was also recognized to offer and explain an 
amendment verbally to the Substitute Amendment that would lower 
the amount of base state grants (excluding Puerto Rico) and 
provide a corresponding increase in the amount of value 
production grants. Discussion occurred and the amendment was 
adopted, by a voice vote.
    Mr. Holden was then recognized to offer and explain an 
amendment on behalf of himself and Mr. Baldacci to the 
Substitute Amendment to transfer $430 million from AMTA 
payments to specialty crops. Discussion occurred and by a voice 
vote, the amendment failed.
    Mr. Boswell was also recognized to offer and explain an 
amendment to the Substitute Amendment that would provide crop 
loss assistance for 2001 crops. Discussion occurred and without 
objection, the amendment was withdrawn.
    Further discussion occurred on the Substitute Amendment and 
it was adopted by a vote of 24 yeas, 23 nays, and 4 not voting. 
See Roll Call Vote #1.
    Mr. Condit offered and explained an amendment to provide 
assistance for agricultural producers whose energy costs have 
increased during calendar 2001. Discussion occurred and the 
amendment was ruled out of order.
    Mr. Smith was then recognized to offer and explain an 
amendment that would add asparagus to the list of purchases. 
Discussion occurred and without objection, the amendment was 
withdrawn.
    Mr. Thompson of California was then recognized to offer and 
explain an amendment to provide payment to producers that 
incurred losses as a result of the Tri-Valley Growers 
bankruptcy. Discussion occurred and without objection, the 
amendment was withdrawn.
    Mr. Thompson offered and explained another amendment that 
would provide payment on a prorated basis to producers that 
incurred losses as a result of the Tri-Valley Growers 
bankruptcy. Discussion occurred and by a voice vote, the 
amendment failed.
    Mr. Lucas of Oklahoma was then recognized to offer and 
explain an amendment that would prohibit the Secretary of 
Agriculture from spending any USDA funds to designate critical 
habitat of the Arkansas River. Discussion occurred and without 
objection, the amendment was withdrawn.
    Mr. Berry was recognized to offer and explain an amendment 
to limit the amount received for one or more contract 
commodities and oilseeds. Discussion occurred and by a voice 
vote, the amendment, as amended, was adopted.
    Mr. Smith was then recognized to offer and explain an 
amendment to provide assistance to eligible orchardists and 
tree farmers. Discussion occurred and without objection, the 
amendment was withdrawn.
    Mr. Pombo was recognized to offer and explain an amendment 
to provide compensation for growers for losses due to Pierce's 
Disease. Discussion occurred and by a voice vote, the amendment 
was adopted.
    Mr. Gutknecht was also recognized to offer and explain an 
amendment to impose tariff-rate quotas on certain casein and 
milk concentrates. Discussion occurred and without objection, 
the amendment was withdrawn.
    Mr. Fletcher was recognized to offer and explain an 
amendment to allow horse breeders affected by the Mare 
Reproductive Loss Syndrome to apply for USDA disaster loans for 
a period of two years. Discussion occurred and without 
objection, the amendment was withdrawn.
    Mr. Kennedy was then recognized to offer and explain report 
language regarding the difficulties faced by Minnesota beet 
growers. Discussion occurred and without objection, report 
language was accepted.
    Mr. Stenholm was then recognized to offer and explain 
report language regarding Farm Service Agency producer 
information. Discussion occurred and without objection, report 
language was accepted.
    Mrs. Clayton was then recognized to offer and explain an 
amendment on behalf of herself, Mr. Putnam and Mr. Condit that 
would provide an increase in funds of $35 million for USDA's 
Animal and Plant Health Inspection Service to respond to pests 
and foot-and- mouth disease. Discussion occurred and without 
objection, the amendment was withdrawn. However, report 
language was accepted in lieu of the amendment.
    Mr. Putnam was also recognized to respond and noted that he 
wanted the report language to acknowledge that there is an 
emergency now even though it is a preventative effort rather 
than an eradication effort to keep foot-and-mouth disease off 
our shores. Without objection, the report language was 
accepted.
    There being no further amendments, Mr. Stenholm moved that 
the bill, H.R. 2213, as amended, be adopted and reported 
favorably to the House with the recommendation that it do pass.
    By a roll call vote of 31 yeas, 14 nays, and 6 not voting, 
H.R. 2213 was ordered reported favorably to the House. See Roll 
Call Vote #2.
    Mr. Stenholm also moved, pursuant to clause 1 rule XX, that 
the Committee authorize the Chairman to offer such motions as 
may be necessary in the House to go to conference with the 
Senate on the bill H.R. 2213, or any similar Senate bill.
    Without objection, the motion was agreed to and the 
Committee adjourned.

                            Roll Call Votes

    In compliance with clause 3(b) of Rule XIII of the House of 
Representatives, the Committee sets forth the record of the 
following roll call votes taken with respect to H.R. 2213.

                            Roll Call No. 1

    Summary: Amendment in the Nature of a Substitute limiting 
overall assistance to $5.5 billion, with $4.6 billion in market 
loss payments to major crop producers, and the balance to 
oilseed, peanut, wool and mohair, tobacco quota holders, as 
well as handlers and producers of cottonseed.
    Offered By: Mr. Stenholm and Mr. Boehner.
    Results: The Substitute Amendment was adopted with 24 yeas, 
23 nays, and 4 not voting.

                                  YEAS

1. Mr. Boehner
2. Mr. Goodlatte
3. Mr. Pombo
4. Mr. Chambliss
5. Mr. Gutknecht
6. Mr. Fletcher
7. Mr. Putnam
8. Mr. Stenholm
9. Mr. Condit
10. Mr. Peterson
11. Mr. Dooley
12. Mrs. Clayton
13. Mr. Hilliard
14. Mr. Holden
15. Mr. Baldacci
16. Mr. McIntyre
17. Mr. Phelps
18. Mr. Lucas (KY)
19. Mr. Thompson (CA)
20. Mr. Hill
21. Mr. Baca
22. Mr. Larsen
23. Mr. Acevedo-Vila
24. Mr. Kind

                                  NAYS

1. Mr. Combest
2. Mr. Smith
3. Mr. Everett
4. Mr. Lucas (OK)
5. Mr. Moran
6. Mr. Thune
7. Mr. Jenkins
8. Mr. Cooksey
9. Mr. Riley
10. Mr. Simpson
11. Mr. Ose
12. Mr. Hayes
13. Mr. Pickering
14. Mr. Johnson
15. Mr. Osborne
16. Mr. Pence
17. Mr. Rehberg
18. Mr. Graves
19. Mr. Kennedy
20. Mr. Berry
21. Mr. Boswell
22. Mr. Ross
23. Mr. Shows

                               NOT VOTING

1. Mr. Schaffer
2. Mr. Bishop
3. Mr. Thompson (MS)
4. Mr. Etheridge

                            Roll Call No. 2

    Summary: Final passage of bill, as amended.
    Requested By: Chairman Combest.
    Results: H.R. 2213 was ordered reported, as amended, 
favorably to the House by a vote of 31 yeas, 14 nays, and 6 not 
voting.

                                  YEAS

1. Mr. Boehner
2. Mr. Pombo
3. Mr. Everett
4. Mr. Chambliss
5. Mr. Cooksey
6. Mr. Gutknecht
7. Mr. Fletcher
8. Mr. Johnson
9. Mr. Graves
10. Mr. Putnam
11. Mr. Kennedy
12. Mr. Stenholm
13. Mr. Condit
14. Mr. Peterson
15. Mr. Dooley
16. Mrs. Clayton
17. Mr. Hilliard
18. Mr. Holden
19. Mr. Bishop
20. Mr. Thompson (MS)
21. Mr. Baldacci
22. Mr. Berry
23. Mr. Phelps
24. Mr. Thompson (CA)
25. Mr. Hill
26. Mr. Baca
27. Mr. Larsen
28. Mr. Ross
29. Mr. Acevedo-Vila
30. Mr. Kind
31. Mr. Shows

                                  NAYS

1. Mr. Combest
2. Mr. Goodlatte
3. Mr. Smith
4. Mr. Lucas (OK)
5. Mr. Moran
6. Mr. Thune
7. Mr. Jenkins
8. Mr. Simpson
9. Mr. Ose
10. Mr. Hayes
11. Mr. Pickering
12. Mr. Osborne
13. Mr. Rehberg
14. Mr. Boswell

                               NOT VOTING

1. Mr. Schaffer
2. Mr. Riley
3. Mr. Pence
4. Mr. McIntyre
5. Mr. Etheridge
6. Mr. Lucas (KY)

                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee on Agriculture's 
oversight findings and recommendations are reflected in the 
body of this report.

           Budget Act Compliance (Sections 308, 402, and 423)

    The provisions of clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives and section 308(a)(1) of the 
Congressional Budget Act of 1974 (relating to estimates of new 
budget authority, new spending authority, new credit authority, 
or increased or decreased revenues or tax expenditures) are not 
considered applicable. The estimate and comparison required to 
be prepared by the Director of the Congressional Budget Office 
under clause 3(c)(3) of rule XIII of the Rules of the House of 
Representatives and sections 402 and 423 of the Congressional 
Budget Act of 1974 submitted to the Committee prior to the 
filing of this report are as follows:

                                     U.S. Congress,
                               Congressional Budget Office,
                                                    Washington, DC,
Hon. Larry Combest,
Chairman, Committee on Agriculture,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2213, a bill to 
respond to the continuing economic crisis adversely affecting 
American agricultural producers.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Jim Langley.
            Sincerely,
                                         Robert A. Sunshine
                                    (For Dan L. Crippen, Director).
    Enclosure.

H.R. 2213--A bill to respond to the continuing economic crisis 
        adversely affecting American agricultural producers

    Summary: H.R. 2213 would authorize new direct spending of 
$5.5 billion from the Commodity Credit Corporation to benefit 
agricultural producers. The bill also would make certain 
technical corrections to agricultural laws and would increase 
payment limitations for marketing assistance loan benefits; CBO 
estimates that these other provisions would have no cost. 
Because the bill would increase direct spending by $5.5 billion 
in 2001, pay-as-you-go procedures would apply.
    H.R. 2213 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA). 
It would require the state of Georgia to make payments to 
tobacco producers in that state as a condition of federal 
assistance to those producers. Any such payments would be 
voluntary.
    Estimated Cost to the Federal Government: The estimated 
budgetary impact of H.R.. 2213 is shown in the following table. 
The costs of this legislation fall within budget functions 350 
and 600 (agriculture and income security).

----------------------------------------------------------------------------------------------------------------
                                                               By fiscal year, in millions of dollars--
                                                     -----------------------------------------------------------
                                                        2001      2002      2003      2004      2005      2006
----------------------------------------------------------------------------------------------------------------
                                           CHANGES IN DIRECT SPENDING

Estimated Budget Authority..........................     5,500         0         0         0         0         0
Estimated Outlays...................................     5,500         0         0         0         0         0
----------------------------------------------------------------------------------------------------------------

    Basis of estimate: H.R. 2213 would authorize the Secretary 
of Agriculture to use the Commodity Credit Corporation (CCC) to 
make $5.5 billion available to agricultural producers in 2001. 
Most of these funds would go directly to producers who were 
eligible to receive the assistance provided in the Agricultural 
Risk Protection Act of 2000 and the Agriculture, Rural 
Development, Food and Drug Administration, and Related Agencies 
Appropriations Act, 2001. About $159 million would be given to 
the states and Puerto Rico to support speciality crops, and 
states would receive $10 million to pay for costs associated 
with processing, transporting, and distributing commodities 
under the provisions of the Emergency Food Assistance Program. 
The bill would require that all obligations and expenditures be 
made prior to September 30, 2001, and that any funds not 
obligated by that date would be rescinded.
    Section 1 would provide $4.6 billion for payments for 
market loss assistance to producers of feed grains, wheat, 
cotton, and rice. Sections 2 through 6 would provide $424 
million to oilseed producers, $54 million to peanut producers, 
$129 million to tobacco producers, $17 million to wool and 
mohair producers, and $85 million to producers and first 
handlers of cottonseed. Under this bill, the Secretary could 
make tobacco payments to producers in Georgia only if the state 
of Georgia makes $13 million in payments to the same eligible 
producers in the state in a timely manner. For this estimate, 
CBO assumes that Georgia would make these payments.
    Section 9 would make certain technical corrections to 
current law regarding indemnity payments for cotton producers. 
CBO estimates these corrections would have no cost. These 
provisions deal with payments to cotton producers in Georgia. 
The 1999 agricultural appropriations act authorized the 
Secretary of Agriculture to transfer $5 million to the State of 
Georgia to establish an indemnity fund to assist cotton 
producers who suffered income losses resulting from the failure 
of certain cotton merchants to pay producers for their cotton. 
As a condition of the payment, Georgia was required to 
contribute a matching $5 million to the indemnity fund. The $5 
million from the Agriculture Department has already been 
transferred and used to make payments to eligible producers. 
However, Georgia did not contribute its share in a timely 
manner, despite an extension of the deadline in the 2001 
agricultural appropriations act. Section 9 would extend the 
deadline for Georgia to contribute its share of the indemnity 
funds, but would not authorize or permit any additional federal 
funds to be expended.
    Section 10 would increase the payment limitations for loan 
deficiency payments (LDPs) and marketing loan gains (MLGs) to 
$150,000 per person during the 2001 crop year. LDPs and MLGs 
allow producers to repay commodity loans at less than the full 
amount of the loan whenever market prices drop below specified 
levels for each eligible commodity. The limitation for these 
payments was originally $75,000 per person. The Agriculture 
Department is authorized to issue loan benefits in the form of 
commodity certificates instead of cash payments. Such 
certificates ultimately result in equivalent cash outlays by 
the department, but do not count against payment limitations. 
Consequently, CBO estimates that the bill's changes to payment 
limitations on LDPs and MLGs would not result in any additional 
federal outlays.
    Section 11 would require that all expenditures authorized 
by this bill be made not later than September 30, 2001. Any 
funds that have not been obligated by that date shall be deemed 
unexpendable and shall be rescinded. In general, each 
provisions of H.R. 2213 specifies that payments are to be made 
to eligible producers who previously received a similar payment 
or directly to states. Hence, USDA would not be required to 
undertake a lengthy sign-up process to determine who is 
eligible for payments. CBO estimates that all the authorized 
payments would be made by September 30.
    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 net 
changes in outlays that are subject to pay-as-you-go procedures 
are shown in the following table. For the purposes of enforcing 
pay-as-you-go procedures, only the effects in the current year, 
the budget year, and the succeeding four years are counted.

----------------------------------------------------------------------------------------------------------------
                                                      By fiscal year, in millions of dollars--
                                   -----------------------------------------------------------------------------
                                     2001    2002   2003   2004   2005   2006   2007   2008   2009   2010   2011
----------------------------------------------------------------------------------------------------------------
Changes in outlays................   5,500      0      0      0      0      0      0      0      0      0      0
Changes in receipts...............                                 Not applicable
----------------------------------------------------------------------------------------------------------------

    Intergovernmental and private-sector impact: H.R. 2213 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. The bill would authorize grants to states for 
activities to promote agriculture and for support of certain 
specialty crops. In addition, the bill would authorize payments 
to tobacco producers in certain states, but would make the 
payment to producers in Georgia's contingent upon any agreement 
by the state to make payments to those same producers totaling 
$13 million. Any such payments by the state would be voluntary.
    Estimate prepared by: Federal Costs: Jim Langley, Dave 
Hull, Greg Hitz and Valerie Baxter. Impact on State, Local, and 
Tribal Governments: Marjorie Miller. Impact on the Private 
Sector: Lauren Marks.
    Estimate approved by: Robert A. Sunshine, Assistant 
Director for Budget Analysis.

                    Performance Goals and Objectives

    With respect to the requirement of clause 3(c)(4) of rule 
XIII of the Rules of the House of Representatives, the 
performance goals and objectives of this legislation are to 
provide economic assistance for producers to be used in the 
2001 Fiscal year that expires September 30, 2001.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds the 
Constitutional authority for this legislation in Article I, 
clause 8, section 18, that grants Congress the power to make 
all laws necessary and proper for carrying out the powers 
vested by Congress in the Constitution of the United States or 
in any department or officer thereof.

                        Committee Cost Estimate

    Pursuant to clause 3(d)(2) of rule XIII of the Rules of the 
House of Representatives, the Committee report incorporates the 
cost estimate prepared by the Director of the Congressional 
Budget Office pursuant to sections 402 and 423 of the 
Congressional Budget Act of 1974.

                      Advisory Committee Statement

    No advisory committee within the meaning of section 5(b) of 
the Federal Advisory Committee Act was created by this 
legislation.

                Applicability to the Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act (Public Law 
104-1).

                       Federal Mandates Statement

    The Committee adopted as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act (Public Law 104-4).

         Changes in Existing Law Made by the Bill, as Reported

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

   SECTION 1121 OF THE AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 
     ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS ACT, 1999


SEC. 1121. INDEMNITY PAYMENTS FOR COTTON PRODUCERS.

  (a)  * * *
  [(b) Conditions on Payment to State.--The Secretary of 
Agriculture shall make the payment to the State of Georgia 
under subsection (a) only if the State also contributes 
$5,000,000 to the indemnity fund and agrees to expend all 
amounts in the indemnity fund by not later than January 1, 
2001, to provide compensation to cotton producers as provided 
in such subsection. If the State of Georgia fails to make its 
contribution of $5,000,000 to the indemnity fund by July 1, 
1999, the funds that would otherwise be paid to the State shall 
be available to the Secretary for the purpose of providing 
partial compensation to cotton producers as provided in such 
subsection.]
  (b) Conditions on Payment to State.--The Secretary of 
Agriculture shall make the payment to the State of Georgia 
under subsection (a) only if the State--
          (1) contributes $5,000,000 to the indemnity fund and 
        agrees to expend all amounts in the indemnity fund by 
        not later than January 1, 2002 (or as soon as 
        administratively practical thereafter), to provide 
        compensation to cotton producers as provided in such 
        subsection;
          (2) requires the recipient of a payment from the 
        indemnity fund to repay the State, for deposit in the 
        indemnity fund, the amount of any duplicate payment the 
        recipient otherwise recovers for such loss of cotton, 
        or the loss of proceeds from the sale of cotton, up to 
        the amount of the payment from the indemnity fund; and
          (3) agrees to deposit in the indemnity fund the 
        proceeds of any bond collected by the State for the 
        benefit of recipients of payments from the indemnity 
        fund, to the extent of such payments.
  (c) Reporting Requirements.--[Upon the establishment of the 
indemnity fund, and not later than October 1, 1999, the] The 
State of Georgia shall submit a report to the Secretary of 
Agriculture and the Congress describing the State's efforts to 
use the indemnity fund to provide compensation to injured 
cotton producers.
  [(d) Additional Disbursement.--
          [(1) Cotton stored in georgia.--The State of Georgia 
        may use funds remaining in the indemnity fund 
        established in accordance with this section to 
        compensate cotton producers in other States who stored 
        cotton in the State of Georgia and incurred losses in 
        1998 or 1999 as the result of the events described in 
        subsection (a).
          [(2) Ginners and others.--The State of Georgia may 
        also use funds remaining in the indemnity fund 
        established in accordance with this section to 
        compensate cotton ginners and others in the business of 
        producing, ginning, warehousing, buying, or selling 
        cotton for losses they incurred in 1998 or 1999 as the 
        result of the events described in subsection (a), if--
                  [(A) as of March 1, 2000, the indemnity fund 
                has not been exhausted,
                  [(B) the State of Georgia provides cotton 
                producers an additional time period prior to 
                May 1, 2000, in which to establish eligibility 
                for compensation under this section;
                  [(C) the State of Georgia determines during 
                calendar year 2000 that all cotton producers in 
                that State and cotton producers in other States 
                as described in paragraph (d)(1) have been 
                appropriately compensated for losses incurred 
                in 1998 or 1999 as described in subsection (a); 
                and
                  [(D) such additional compensation is not made 
                available until May 1, 2000.]
  (d) Additional Disbursement to Cotton Ginners.--The State of 
Georgia shall use funds remaining in the indemnity fund, after 
the provision of compensation to cotton producers in Georgia 
under subsection (a) (including cotton producers who file a 
contingent claim, as defined and provided in section 5.1 of 
chapter 19 of title 2 of the Official Code of Georgia), to 
compensate cotton ginners (as defined and provided in such 
section) that--
          (1) incurred a loss as the result of--
                  (A) the business failure of any cotton buyer 
                doing business in Georgia; or
                  (B) the failure or refusal of any such cotton 
                buyer to pay the contracted price that had been 
                agreed upon by the ginner and the buyer for 
                cotton grown in Georgia on or after January 1, 
                1997, and had been purchased or contracted by 
                the ginner from cotton producers in Georgia;
          (2) paid cotton producers the amount which the cotton 
        ginner had agreed to pay for such cotton received from 
        such cotton producers in Georgia; and
          (3) satisfy the procedural requirements and deadlines 
        specified in chapter 19 of title 2 of the Official Code 
        of Georgia applicable to cotton ginner claims.

                            ADDITIONAL VIEWS

    H.R. 2213, as reported by the Agriculture Committee will 
provide $5.5 billion in much needed assistance this year. This 
legislation represents a meaningful first step in keeping 
Congress' commitment to stand by our farmers and ranchers each 
year until a permanent safety net is put in place.
    However, H.R. 2213 as reported by the Agriculture Committee 
is inadequate in at least two respects. First, the assistance 
level is not sufficient to address the needs of farmers and 
ranchers in the 2001 crop year. Second, the bill's scope is too 
narrow, leaving many needs completely unaddressed.
    At a time when real net cash income on the farm is at its 
lowest level since the Great Depression and the cost of 
production is expected to set a record high, H.R. 2213 as 
reported by the Committee cuts supplemental help to farmers by 
$1 billion from last year to this year. Hardest hit will be 
wheat, corn, grain sorghum, barley, oats, upland cotton, rice, 
soybean, and other oilseed farmers since the cuts will come at 
their expense.
    H.R. 2213, as reported by the Committee, also fails to 
address the needs of dairy farmers, sugar beet and sugarcane 
farmers, farmers who graze their wheat, barleys, and oats, as 
well as farmers who are denied marketing loan assistance either 
because they don't haven an AMTA contract or because they lost 
beneficial interest in their crops.
    Earlier this year, 20 farm group pegged the need in farm 
country for the 2001 crop year at $9 billion. And, while most 
of these groups acknowledge that limited federal resources 
cannot possibly accommodate that level of supplemental 
assistance, the farmers they represent--and their lenders--had 
every reason to believe that the help this year would be at 
least comparable to the help Congress provided last year. Since 
H.R. 2213 as reported will not meet expectation, it is our 
sincere hope that the fallout in farm country as a result of 
this bill's passage will be limited to mere disappointment.
    H.R. 2213, as originally introduced provided a level of 
support that more closely reflected the expectations and actual 
needs in farm country. The $6.5 billion measure provided the 
same level of assistance to producers of staple crops as last 
year; increased assistance to producers of specialty crops over 
last year through purchases that would have moved the market 
without damaging prices in the long term; assisted producers of 
sugar, dairy, peanuts, tobacco, wool and mohair; producers who 
graze their wheat, barley, and oats; as well as producers who 
are denied marketing loan assistance either because they don't 
have an AMTA contract or they lost beneficial interest in their 
crops.
    Those who championed H.R. 2213 as reported by this 
Committee argued, in part, that a cut in help to farmers this 
year is necessary to save money for a rewrite of the Farm Bill. 
But, the fly in the ointment is that many farmers are deeply 
worried about whether they can make it through this year, let 
alone next year.
    As this process moves forward, we will work to build a more 
sturdy bridge over this year's financial straits--straits that 
man otherwise threaten to separate many farmers from the 
promise of the next farm bill.
                                   Larry Combest, Chairman.
                                   Charles W. ``Chip'' Pickering.
                                   Dennis R. Rehberg.
                                   Mike Pence.
                                   Sam Graves.
                                   Tom Osborne.
                                   Mark R. Kennedy.
                                   Terry Everett.
                                   Ronnie Shows.
                                   Robin Hayes.
                                   Michael K. Simpson.
                                   Doug Ose.
                                   Frank D. Lucas.
                                   John R. Thune.
                                   William L. Jenkins.
                                   Bob Riley.
                                   Jerry Moran.

                                
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