I

104TH CONGRESS

1ST SESSION H. R. 2696

To extend and revise the agricultural price support programs for rice, upland

cotton, feed grains, wheat, and oilseeds, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

NOVEMBER 30, 1995

Mr. MINGE introduced the following bill; which was referred to the Committee

on Agriculture

A BILL

To extend and revise the agricultural price support programs

for rice, upland cotton, feed grains, wheat, and oilseeds,

and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

4 (a) SHORT TITLE.—This Act may be cited as the

5 ‘‘Agricultural Equity Act of 1995’’.

6 (b) TABLE OF CONTENTS.—The table of contents of

7 this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Findings, policy, and purpose.

Sec. 3. Sense of Congress on ending the Federal deficit.
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Sec. 4. Nonrecourse loans and deficiency payments for the 1996 through 2002

crops of rice, upland cotton, feed grains, wheat, and oilseeds.

Sec. 5. Review of status and future of production agriculture.

1 SEC. 2. FINDINGS, POLICY, AND PURPOSE.

2 (a) FINDINGS.—Congress finds the following:

3 (1) A sound and prosperous economy in the

4 United States is dependent on American agriculture

5 and related industries, including producers, proc6 essors, handlers, manufacturers, marketers, trans7 porters, and the banking and credit industry.

8 (2) American agriculture and related industries

9 account for over 21,000,000 jobs and approximately

10 16 percent, or over $41,000,000,000,000, of the

11 gross domestic product.

12 (3) Because of the combined effort of American

13 agriculture and related industries, consumers in the

14 United States enjoy a dependable supply of food and

15 fiber at fair prices.

16 (4) The future of American agriculture is de17 pendent on the continued viability of the American

18 agricultural producer, the underpinning of the na19 tional economy.

20 (5) Agricultural producers must receive a fair

21 return on their productivity and investment in an in22 dustry characterized by continued subsidized foreign

23 competition and wide fluctuations in production and

24 prices due to weather and related factors.
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1 (6) One of the essential elements of a sound ag2 ricultural economy is the ability of the United States

3 to compete in the world market.

4 (7) Exports of United States agricultural com5 modities are expected to reach nearly

6 $50,000,000,000 in 1995 and contribute about

7 $20,000,000,000 to the United States balance of

8 trade.

9 (8) Agricultural exports account for over

10 1,000,000 American jobs.

11 (9) Commodity Credit Corporation outlays for

12 farm programs have declined from a high of approxi13 mately $26,000,000,000 for fiscal year 1986 to less

14 than $9,000,000,000 for fiscal year 1995, a reduc15 tion of over 65 percent that is unique among the

16 many mandatory spending programs of the Federal

17 Government.

18 (10) According to the Congressional Budget Of19 fice, farm program outlays are projected to remain

20 below the outlay level for fiscal year 1995 for the

21 next 5 years and continue to decline by nearly 8 per22 cent, even if no changes are made in current law for

23 existing farm programs.

24 (b) POLICY.—It is the policy of the United States

25 that—
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1 (1) continued Federal Government support is

2 necessary to provide stability for American agricul3 tural producers to—

4 (A) enable the producers to continue to

5 provide consumers with a steady and depend6 able supply of food and fiber at fair prices;

7 (B) enhance farmer and rancher profit8 ability;

9 (C) encourage young farmers to stay on

10 the farm;

11 (D) maintain the competitiveness of the

12 United States in the world market; and

13 (E) otherwise preserve the underpinnings

14 of a sound agricultural economy; and

15 (2) reductions in farm program spending should

16 be made in a fair and equitable manner in order to

17 meet the objective of achieving a balanced budget for

18 the Federal Government in a manner consistent with

19 paragraph (1).

20 (c) PURPOSE.—The purpose of this Act is to establish

21 agricultural price support and production adjustment pro22 grams for the 1996 through 2002 crop years that provide

23 a structure for a sound agricultural economy in a manner

24 consistent with subsection (b).
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1 SEC. 3. SENSE OF CONGRESS ON ENDING THE FEDERAL

2 DEFICIT.

3 It is the sense of Congress that—

4 (1) the continuation of significant Federal

5 budgetary deficits harms the economic well-being of

6 the United States and is detrimental to the develop7 ment of sound, long-term agricultural policy;

8 (2) agricultural price support and production

9 adjustment programs are necessary for the contin10 ued economic health of United States agriculture,

11 which must compete in international markets

12 against subsidized foreign competition; and

13 (3) agricultural price support and production

14 adjustment programs should be—

15 (A) implemented, to the maximum extent

16 practicable, in a manner that is consistent with

17 the primary goal of the concurrent resolution on

18 the budget for fiscal year 1996 (H. Con. Res.

19 67, agreed to June 29, 1995) to end Federal

20 budget deficits; and

21 (B) modified, as necessary, to ensure that

22 the programs comply with applicable budget

23 reconciliation instructions in the concurrent res24 olution that are designed to end Federal budget

25 deficits, in a manner consistent with section

26 306 of the concurrent resolution.
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1 SEC. 4. NONRECOURSE LOANS AND DEFICIENCY PAYMENTS

2 FOR THE 1996 THROUGH 2002 CROPS OF RICE,

3 UPLAND COTTON, FEED GRAINS, WHEAT, AND

4 OILSEEDS.

5 (a) DEFINITIONS.—For purposes of this section:

6 (1) COVERED COMMODITIES.—The term ‘‘cov7 ered commodities’’ means rice, upland cotton, feed

8 grains, wheat, and oilseeds.

9 (2) FEED GRAINS.—The term ‘‘feed grains’’

10 means corn, grain sorghum, barley, and oats.

11 (3) OILSEEDS.—The term ‘‘oilseeds’’ means

12 soybeans, sunflower seeds, canola, rapeseed, saf13 flower, flaxseed, mustard seed, and such other oil14 seeds as the Secretary may determine appropriate

15 for inclusion.

16 (b) NONRECOURSE LOANS.—

17 (1) PRICE SUPPORT LOANS.—The Secretary

18 shall make available to producers on a farm

19 nonrecourse loans for each of the 1996 through

20 2002 crops of each covered commodity at the level

21 specified in paragraph (2). Acreage covered shall in22 clude both mandatory and voluntary flex acres.

23 (2) LOAN LEVELS.—The loan levels for each

24 covered commodity shall be 100 percent of the sim25 ple average price received by producers of that cov26 ered commodity, as determined by the Secretary,
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1 during the marketing years for the preceding 5

2 crops of that covered commodity, excluding the year

3 in which the average price was the highest and the

4 year in which the average price was the lowest in the

5 period. The Secretary may adjust the loan level for

6 a particular covered commodity to reflect changes in

7 the market price of that covered commodity.

8 (3) PROHIBITIONS.—The Secretary shall not

9 make available a marketing loan or loan deficiency

10 payment to any producer on a farm for any of the

11 1996 through 2002 crops of covered commodities.

12 (c) DEFICIENCY PAYMENTS.—

13 (1) IN GENERAL.—The Secretary shall make

14 deficiency payments available to producers for each

15 of the 1996 through 2002 crops of each covered

16 commodity (other than oilseeds) in an amount com17 puted by multiplying—

18 (A) the payment rate for the covered com19 modity;

20 (B) the payment acres for the crop of that

21 covered commodity; and

22 (C) the farm program yield for the crop of

23 that covered commodity for the farm.

24 (2) PAYMENT RATE.—
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1 (A) MINIMUM ESTABLISHED PRICE.—The

2 minimum established price in effect for the

3 1991 through 1995 crops of each covered com4 modity shall continue in effect for the 1996

5 through 2002 crops of that covered commodity.

6 (B) ESTABLISHMENT OF RATE.—The pay7 ment rate for each of the 1996 through 2002

8 crops of each covered commodity shall be the

9 amount by which the target price exceeds the

10 higher of—

11 (i) the loan level established for that

12 covered commodity under subsection (b);

13 (ii) the average market price of that

14 covered commodity.

15 (3) PAYMENT ACRES.—Payment acres for a

16 crop of a covered commodity shall equal base acres

17 less idled (set aside) and flex (mandatory and op18 tional) acres.

(4) ELIMINATION OF 0⁄85 AND 50 19 ⁄85 PRO20 GRAMS.—The Secretary shall discontinue the partial

payment programs, variously known as 0⁄85, 50 21 ⁄85,

0⁄92, and 50 22 ⁄92, effective with crop year 1996.

23 (d) FLEXIBILITY (‘FLEX’) PROGRAM.—The Sec24 retary shall increase producer planting flexibility—
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1 (1) by increasing the mandatory flex acreage

2 percentage for each covered commodity from 15 per3 cent to 20 percent; and

4 (2) by offering producers an additional vol5 untary increase in flex acres of between 10 percent

6 to 25 percent.

7 (e) CROP INSURANCE REQUIREMENT.—As a condi8 tion for eligibility for crop loans and deficiency payments

9 under this section, the producers on a farm shall obtain

10 catastrophic risk protection insurance coverage in accord11 ance with section 508(b) of the Federal Crop Insurance

12 Act (7 U.S.C. 1508(b)).

13 (f) CONFORMING REPEALS.—Sections 101B (rice),

14 103B (cotton), 105B (feed grains), 107B (wheat), and

15 205 (oilseeds) of the Agricultural Act of 1949 are re16 pealed. The repeal of such sections shall not affect the

17 authority of the Secretary to carry out a price support

18 or production adjustment program for any of the 1991

19 through 1995 crops of a covered commodity under a provi20 sion of law in effect immediately before the date of the

21 enactment of this Act.

22 SEC. 5. REVIEW OF STATUS AND FUTURE OF PRODUCTION

23 AGRICULTURE.

24 (a) SCOPE OF REVIEW.—The Secretary of Agri25 culture shall conduct a comprehensive review of the status
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1 and future of production agriculture and farming commu2 nities in the United States and the extent to which the

3 program changes made by this Act will impact production

4 agriculture and farming communities in the United States.

5 The review shall include the following—

6 (1) an assessment of the food security situation

7 in the United States in the areas of trade, consumer

8 prices, international competitiveness of United

9 States production agriculture, food supplies, and hu10 manitarian relief;

11 (2) an assessment of current and future farm

12 land values and agricultural producer incomes;

13 (3) an assessment of the extent to which regu14 latory relief for agricultural producers has been en15 acted and implemented, including the application of

16 cost-benefit principles in the issuance of agricultural

17 regulations;

18 (4) an assessment of the extent to which tax re19 lief for agricultural producers has been enacted in

20 the form of capital gains tax reductions, estate tax

21 exemptions, and mechanisms to average tax loads

22 over high- and low-income years;

23 (5) an assessment of any Federal Government

24 interference in agricultural export markets, such as

25 the imposition of trade embargoes, and the degree of
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1 implementation and success of international trade

2 agreements;

3 (6) identification of the appropriate future rela4 tionship of the Federal Government with production

5 agriculture after 2002;

6 (7) identification of the long-term goals for pro7 duction agriculture and farming communities in the

8 United States and recommendations for actions

9 needed to achieve those goals; and

10 (8) an assessment of manpower and infrastruc11 ture requirements of the Department of Agriculture

12 as the result of program changes made by this Act.

13 (b) LEGISLATIVE PROPOSALS.—As part of the com14 prehensive review required under subsection (a), the Sec15 retary shall develop specific legislative proposals to imple16 ment any recommendations being made.

17 (c) REPORTS.—The Secretary shall report the find18 ings and recommendations made under subsection (a) to

19 the President, to the Committee on Agriculture of the

20 House of Representatives, and to the Committee on Agri21 culture, Nutrition, and Forestry of the Senate, not later

22 than March 31, 1997.

23 (d) HEARINGS.—The Secretary may, for the purpose

24 of carrying out this section, conduct such hearings and
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1 receive such evidence as the Secretary considers appro2 priate.

3 (e) ASSISTANCE FROM OTHER AGENCIES.—The Sec4 retary may secure from other departments and agencies

5 of the Federal Government such information as may be

6 necessary to carry out this section.

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