89–006

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

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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.

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(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.’’.

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(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

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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 un- less 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 ImVerDate 11-MAY-2000 17:26 Jun 27, 2001 Jkt 089006 PO 00000 Frm 00005 Fmt 6659 Sfmt 6602 E:\HR\OC\HR111.XXX pfrm04 PsN: HR111
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provement 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.

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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 upto-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

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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 between RMA 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 inVerDate 11-MAY-2000 17:26 Jun 27, 2001 Jkt 089006 PO 00000 Frm 00008 Fmt 6659 Sfmt 6602 E:\HR\OC\HR111.XXX pfrm04 PsN: HR111
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creased 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

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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.

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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.

12

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 inVerDate 11-MAY-2000 17:26 Jun 27, 2001 Jkt 089006 PO 00000 Frm 00012 Fmt 6659 Sfmt 6602 E:\HR\OC\HR111.XXX pfrm04 PsN: HR111
13

creased 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-andmouth disease. Discussion occurred and without objection, the

amendment was withdrawn. However, report language was accepted in lieu of the amendment.

14

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

15

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

16

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

17

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.

18

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.

19

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) * * *

ø(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

20

(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.—øUpon 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.

ø(d) ADDITIONAL DISBURSEMENT.— ø(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).

ø(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— ø(A) as of March 1, 2000, the indemnity fund has not

been exhausted,

ø(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;

ø(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

ø(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.

(21)

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

22

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.

Æ