I

104TH CONGRESS

1ST SESSION H. R. 2189

To amend the Agricultural Adjustment Act of 1938 and the Agricultural

Act of 1949 to provide price support and national poundage quotas

for the 1996 through 2000 crops of peanuts, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

AUGUST 3, 1995

Mr. CHAMBLISS (for himself, Mr. BISHOP, Mr. DE LA GARZA, Mr. ROSE, Mrs.

CLAYTON, Mr. BAESLER, Mrs. THURMAN, Mr. FARR, Mr. STENHOLM,

Mr. LUCAS, Ms. MCKINNEY, Mr. LATHAM, Mr. THOMPSON, Mr. KINGSTON, Mr. HEFNER, Mr. NORWOOD, Mr. SISISKY, Mr. FUNDERBURK, Mr.

RICHARDSON, Mr. LEWIS of Georgia, Mr. JONES, Mr. BREWSTER, Mr.

BURR, Mr. PETERSON of Florida, Mr. HEINEMAN, Mr. TEJEDA, Mr.

WATTS of Oklahoma, Ms. BROWN of Florida, Mr. HASTINGS of Florida,

Mr. CLYBURN, Mr. PASTOR, Mrs. MEEK of Florida, and Mr. LEWIS of

Kentucky) introduced the following bill; which was referred to the Committee on Agriculture

A BILL

To amend the Agricultural Adjustment Act of 1938 and

the Agricultural Act of 1949 to provide price support

and national poundage quotas for the 1996 through 2000

crops of peanuts, 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,
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1 SECTION 1. NATIONAL POUNDAGE QUOTAS AND ACREAGE

2 ALLOTMENTS.

3 Section 358–1 of the Agricultural Adjustment Act of

4 1938 (7 U.S.C. 1358–1) is amended to read as follows:

5 ‘‘SEC. 358–1. NATIONAL POUNDAGE QUOTAS AND ACREAGE

6 ALLOTMENTS FOR PEANUTS.

7 ‘‘(a) NATIONAL POUNDAGE QUOTAS.—

8 ‘‘(1) ESTABLISHMENT.—The national poundage

9 quota for peanuts for each marketing year shall be

10 established by the Secretary at a level that is equal

11 to the quantity of peanuts (in tons) that the Sec12 retary estimates will be devoted in each such mar13 keting year to domestic edible and related uses, ex14 cluding seed. The Secretary shall also include in his

15 annual estimate of domestic edible and related uses,

16 the estimated quantity of peanuts and peanut prod17 ucts to be imported into the United States for the

18 marketing year for which the quota is being estab19 lished.

20 ‘‘(2) ANNOUNCEMENT.—The national poundage

21 quota for a marketing year shall be announced by

22 the Secretary not later than December 15 preceding

23 the marketing year.

24 ‘‘(3) APPORTIONMENT AMONG STATES.—The

25 national poundage quota established under para26 graph (1) shall be apportioned among the States so
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1 that the poundage quota allocated to each State

2 shall be equal to the percentage of the national

3 poundage quota allocated to farms in the State for

4 1995.

5 ‘‘(b) FARM POUNDAGE QUOTAS.—

6 ‘‘(1) IN GENERAL.—

7 ‘‘(A) ESTABLISHMENT.—A farm poundage

8 quota for each marketing year shall be estab9 lished—

10 ‘‘(i) for each farm that had a farm

11 poundage quota for peanuts for the 1995

12 marketing year;

13 ‘‘(ii) if the poundage quota appor14 tioned to a State under subsection (a)(3)

15 for any such marketing year is larger than

16 the quota for the immediately preceding

17 marketing year, for each other farm on

18 which peanuts were produced for market19 ing in at least 2 of the 3 immediately pre20 ceding crop years, as determined by the

21 Secretary; and

22 ‘‘(iii) as approved and determined by

23 the Secretary under section 358c, for each

24 farm on which peanuts are produced in
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1 connection with experimental and research

2 programs.

3 ‘‘(B) QUANTITY.—The farm poundage

4 quota for each marketing year for each farm

5 described in subparagraph (A)(i) shall be the

6 same as the farm poundage quota for the farm

7 for the immediately preceding marketing year,

8 as adjusted under paragraph (2), but not in9 cluding any increases resulting from the alloca10 tion of quotas voluntarily released for one year

11 under paragraph (7). The farm poundage

12 quota, if any, for each marketing year for each

13 farm described in subparagraph (A)(ii) shall be

14 equal to the quantity of peanuts allocated to the

15 farm for the year under paragraph (2).

16 ‘‘(C) TRANSFERS.—For purposes of this

17 subsection, if the farm poundage quota, or any

18 part thereof, is permanently transferred in ac19 cordance with section 358a or 358b, the receiv20 ing farm shall be considered as possessing the

21 farm poundage quota (or portion thereof) of the

22 transferring farm for all subsequent marketing

23 years.

24 ‘‘(2) ADJUSTMENTS.—
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1 ‘‘(A) ALLOCATION OF INCREASED QUOTA

2 GENERALLY.—Except as provided in subpara3 graph (C), if the poundage quota apportioned

4 to a State under subsection (a)(3) of any mar5 keting year is increased over the poundage

6 quota apportioned to farms in the State for the

7 immediately preceding marketing year, the in8 crease shall be allocated proportionately, based

9 on farm production history for peanuts for the

10 3 immediately preceding years, among—

11 ‘‘(i) all farms in the State for each of

12 which a farm poundage quota was estab13 lished for the marketing year immediately

14 preceding the marketing year for which the

15 allocation is being made; and

16 ‘‘(ii) all other farms in the State on

17 each of which peanuts were produced in at

18 least 2 of the 3 immediately preceding crop

19 years, as determined by the Secretary.

20 ‘‘(B) DECREASE.—If the poundage quota

21 apportioned to a State under subsection (a)(3)

22 for any marketing year is decreased from the

23 poundage quota apportioned to farms in the

24 State under subsection (a)(3) for the imme25 diately preceding marketing year, the decrease
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1 shall be allocated among all the farms in the

2 State for each of which a farm poundage quota

3 was established for the marketing year imme4 diately preceding the marketing year for which

5 the allocation is being made.

6 ‘‘(C) SPECIAL RULE ON TENANT’S SHARE

7 OF INCREASED QUOTA.—Subject to terms and

8 conditions prescribed by the Secretary, on

9 farms that were leased to a tenant for peanut

10 production, the tenant shall share equally with

11 the owner of the farm in that percentage of the

12 quota referred to in subparagraph (A) and oth13 erwise allocated to the farm as the result of the

14 tenant’s production on the farm of additional

15 peanuts. Not later than April 1 of each year or

16 as soon as practicable, the tenant’s share of any

17 such quota shall be allocated to a farm within

18 the county owned by the tenant or sold by the

19 tenant to the owner of any farm within the

20 county and permanently transferred to that

21 farm. Any quota not so disposed of as provided

22 in this subparagraph shall be allocated to other

23 quota farms in the State under paragraph (6)

24 as part of the quota reduced from farms in the

25 State due to the failure to produce the quota.
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1 ‘‘(3) QUOTA NOT PRODUCED.—

2 ‘‘(A) IN GENERAL.—Insofar as practicable

3 and on such fair and equitable basis as the Sec4 retary may by regulation prescribe, the farm

5 poundage quota established for a farm for any

6 marketing year shall be reduced to the extent

7 that the Secretary determines that the farm

8 poundage quota established for the farm for

9 any 2 of the 3 marketing years preceding the

10 marketing year for which the determination is

11 being made was not produced, or considered

12 produced, on the farm.

13 ‘‘(B) EXCLUSIONS.—For purposes of this

14 paragraph, the farm poundage quota for any

15 such preceding marketing year shall not include

16 any increase resulting from the allocation of

17 quotas voluntarily released for 1 year under

18 paragraph (7).

19 ‘‘(4) QUOTA CONSIDERED PRODUCED.—For

20 purposes of this subsection, the farm poundage

21 quota shall be considered produced on a farm if—

22 ‘‘(A) the farm poundage quota was not

23 produced on the farm because of drought, flood,

24 or any other natural disaster, or any other con-
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1 dition beyond the control of the producer, as

2 determined by the Secretary; or

3 ‘‘(B) the farm poundage quota for the

4 farm was either leased to another owner or op5 erator of a farm within the same county for

6 transfer to such farm for only 1 of the 3 mar7 keting years immediately preceding the market8 ing year for which the determination is being

9 made or the farm poundage quota was released

10 voluntarily under paragraph (7) for only 1 of

11 the 3 marketing years immediately preceding

12 the marketing year for which the determination

13 is being made. The farm poundage quota shall

14 not be considered produced for more than one

15 marketing year out of the three immediately

16 preceding marketing years under this subpara17 graph.

18 ‘‘(5) QUOTA PERMANENTLY RELEASED.—Not19 withstanding any other provision of law—

20 ‘‘(A) the farm poundage quota established

21 for a farm under this subsection, or any part of

22 the quota, may be permanently released by the

23 owner of the farm, or the operator with the per24 mission of the owner; and
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1 ‘‘(B) the poundage quota for the farm for

2 which the quota is released shall be adjusted

3 downward to reflect the quota that is so re4 leased.

5 ‘‘(6) ALLOCATION OF QUOTAS REDUCED OR RE6 LEASED.—

7 ‘‘(A) IN GENERAL.—Except as provided in

8 subparagraph (B), the total quantity of the

9 farm poundage quotas reduced or voluntarily

10 released from farms in a State for any market11 ing year under paragraphs (3) and (5) shall be

12 allocated, as the Secretary may by regulation

13 prescribe, to other farms in the State as pro14 vided in subparagraph (B) on which peanuts

15 were produced in at least 2 of the 3 crop years

16 immediately preceding the year for which the

17 allocation is being made.

18 ‘‘(B) SET-ASIDE FOR FARMS WITH NO

19 QUOTA.—The total amount of farm poundage

20 quota to be allocated in the State under sub21 paragraph (A) shall be allocated to farms in the

22 State for which no farm poundage quota was

23 established for the immediately preceding year’s

24 crop. The allocation to any such farm shall not

25 exceed the average farm production of peanuts
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1 for the 3 immediately preceding years during

2 which peanuts were produced on the farm. Any

3 farm quota pounds remaining after allocation to

4 farms under this subparagraph shall be allo5 cated to farms in the State on which poundage

6 quotas were established for the immediately

7 preceding year’s crop.

8 ‘‘(7) QUOTA TEMPORARILY RELEASED.—

9 ‘‘(A) IN GENERAL.—The farm poundage

10 quota, or any portion thereof, established for a

11 farm for a marketing year may be voluntarily

12 released to the Secretary to the extent that the

13 quota, or any part thereof, will not be produced

14 on the farm for the marketing year. Any farm

15 poundage quota so released in a State shall be

16 allocated to other farms in the State on such

17 basis as the Secretary may by regulation pre18 scribe.

19 ‘‘(B) EFFECTIVE PERIOD.—Except as oth20 erwise provided in this section, any adjustment

21 in the farm poundage quota for a farm under

22 subparagraph (A) shall be effective only for the

23 marketing year for which it is made and shall

24 not be taken into consideration in establishing

25 a farm poundage quota for the farm from which
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1 the quota was released for any subsequent mar2 keting year.

3 ‘‘(8) TRANSFER OF ADDITIONAL PEANUTS.—

4 Additional peanuts on a farm from which the quota

5 poundage was not harvested and marketed may be

6 transferred to the quota loan pool for pricing pur7 poses on such basis as the Secretary shall by regula8 tion provide, except that the poundage of such pea9 nuts so transferred shall not exceed the difference in

10 the total peanuts meeting quality requirements for

11 domestic edible use as determined by the Secretary

12 marketed from the farm and the total farm pound13 age quota, excluding quota pounds transferred to the

14 farm in the fall.

15 Peanuts transferred under provisions of this

16 paragraph shall be supported at a total of not less

17 than 70 percent of the quota support rate for the

18 marketing years in which such transfers occur and

19 such transfers for a farm shall not exceed 25 per20 cent of the total farm quota pounds, excluding

21 pounds transferred in the fall.

22 ‘‘(9) TEMPORARY QUOTA ALLOCATION.—

23 ‘‘(A) Temporary allocation of quota pounds

24 for the marketing year only in which the crop

25 is planted shall be made to producers as pro-
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1 vided in this subsection. The temporary quota

2 allocation shall be equal to the pounds of seed

3 peanuts planted on the farm as may be ad4 justed under regulations that shall be pre5 scribed by the Secretary. The temporary alloca6 tion of quota pounds under this paragraph shall

7 be in addition to the farm quota pounds estab8 lished under paragraph (1).

9 ‘‘(B) The allocation of quota pounds to

10 producers under the provisions of this sub11 section shall be performed in such a manner as

12 will not result in a net decrease in quota

13 pounds on a farm in excess of 3 percent, after

14 temporary seed quota is added, from the basic

15 farm quota in 1996 and such decrease shall

16 occur one time only and shall be applicable to

17 the 1996 marketing year only.

18 ‘‘(C) Implementation of provisions in this

19 subsection may continue so long as doing so

20 does not result in increased cost to the Com21 modity Credit Corporation by displacement of

22 quota peanuts by additional peanuts in the do23 mestic market, increased losses in the Associa24 tion loan pools or other such increases in cost.
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1 ‘‘(D) Nothing in this paragraph shall alter

2 or change in any way the requirements of sec3 tion 358e(b).

4 ‘‘(c) FARM YIELDS.—

5 ‘‘(1) IN GENERAL.—For each farm for which a

6 farm poundage quota is established under subsection

7 (b), and when necessary for purposes of this Act, a

8 farm yield of peanuts shall be determined for each

9 such farm.

10 ‘‘(2) QUANTITY.—The yield shall be equal to

11 the average of the actual yield per acre on the farm

12 for each of the 3 crop years in which yields were

13 highest on the farm out of the 5 crop years 1973

14 through 1977.

15 ‘‘(3) APPRAISED YIELDS.—If peanuts were not

16 produced on the farm in at least 3 years during the

17 5-year period or there was a substantial change in

18 the operation of the farm during the period (includ19 ing a change in operator, lessee who is an operator,

20 or irrigation practices), the Secretary shall have a

21 yield appraised for the farm. The appraised yield

22 shall be that quantity determined to be fair and rea23 sonable on the basis of yields established for similar

24 farms that are located in the area of the farm and

25 on which peanuts were produced, taking into consid-
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1 eration land, labor, and equipment available for the

2 production of peanuts, crop rotation practices, soil

3 and water, and other relevant factors.

4 ‘‘(d) REFERENDUM RESPECTING POUNDAGE

5 QUOTAS.—

6 ‘‘(1) IN GENERAL.—Not later than December

7 15 of each calendar year, the Secretary shall con8 duct a referendum of producers engaged in the pro9 duction of quota peanuts in the calendar year in

10 which the referendum is held to determine whether

11 the producers are in favor of or opposed to poundage

12 quotas with respect to the crops of peanuts produced

13 in the 5 calendar years immediately following the

14 year in which the referendum is held, except that, if

15 as many as two-thirds of the producers voting in any

16 referendum vote in favor of poundage quotas, no ref17 erendum shall be held with respect to quotas for the

18 second, third, fourth, and fifth years of the period.

19 ‘‘(2) PROCLAMATION.—The Secretary shall pro20 claim the result of the referendum within 30 days

21 after the date on which it is held.

22 ‘‘(3) VOTE AGAINST QUOTAS.—If more than

23 one-third of the producers voting in the referendum

24 vote against quotas, the Secretary also shall pro25 claim that poundage quotas will not be in effect with
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1 respect to the crop of peanuts produced in the cal2 endar year immediately following the calendar year

3 in which the referendum is held.

4 ‘‘(e) DEFINITIONS.—For the purposes of this part

5 and title I of the Agricultural Act of 1949 (7 U.S.C. 1441

6 et seq.):

7 ‘‘(1) ADDITIONAL PEANUTS.—The term ‘addi8 tional peanuts’ means, for any marketing year—

9 ‘‘(A) any peanuts that are marketed from

10 a farm for which a farm poundage quota has

11 been established and that are in excess of the

12 marketings of quota peanuts from the farm for

13 the year; and

14 ‘‘(B) all peanuts marketed from a farm for

15 which no farm poundage quota has been estab16 lished in accordance with subsection (b).

17 ‘‘(2) CRUSHING.—The term ‘crushing’ means

18 the processing of peanuts to extract oil for food uses

19 and meal for feed uses, or the processing of peanuts

20 by crushing or otherwise when authorized by the

21 Secretary.

22 ‘‘(3) DOMESTIC EDIBLE USE.—The term ‘do23 mestic edible use’ means use for milling to produce

24 domestic food peanuts (other than those described in

25 paragraph (2)) and use on a farm, except that the
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1 Secretary may exempt from this definition seeds of

2 peanuts that are used to produce peanuts excluded

3 under section 358d(c), are unique strains, and are

4 not commercially available.

5 ‘‘(4) QUOTA PEANUTS.—The term ‘quota pea6 nuts’ means, for any marketing year, any peanuts

7 produced on a farm having a farm poundage quota,

8 as determined in subsection (b), that—

9 ‘‘(A) are eligible for domestic edible use as

10 determined by the Secretary;

11 ‘‘(B) are marketed or considered marketed

12 from a farm; and

13 ‘‘(C) do not exceed the farm poundage

14 quota of the farm for the year.

15 ‘‘(f) CROPS.—Notwithstanding any other provision of

16 law, this section shall be effective only for the 1996

17 through 2000 crops of peanuts.’’.

18 SEC. 2. SALE, LEASE, OR TRANSFER OF FARM POUNDAGE

19 QUOTA.

20 Section 358b of the Agricultural Adjustment Act of

21 1938 (7 U.S.C. 1358b) is amended to read as follows:

22 ‘‘SEC. 358b. SALE, LEASE, OR TRANSFER OF FARM POUND23 AGE QUOTA FOR PEANUTS.

24 ‘‘(a) IN GENERAL.—
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1 ‘‘(1) AUTHORITY.—Subject to such terms, con2 ditions, or limitations as the Secretary may pre3 scribe, the owner, or operator with the permission of

4 the owner, of any farm for which a farm poundage

5 quota has been established under this Act may sell

6 or lease all or any part of the poundage quota to any

7 other owner or operator of a farm within the same

8 county for transfer to the farm, except that any such

9 lease of poundage quota may be entered into in the

10 fall or after the normal planting season—

11 ‘‘(A) with the owner or operator of another

12 farm located within the same county or located

13 in a different county within the same state;

14 ‘‘(B) if not less than 90 percent of the

15 basic quota (the farm quota exclusive of tem16 porary quota transfers), plus any poundage

17 quota transferred to the farm under this sub18 section, has been planted or considered planted

19 on the farm from which the quota is to be

20 leased; and

21 ‘‘(C) under such terms and conditions as

22 the Secretary may by regulation prescribe.

23 In the case of a fall transfer or a transfer after the

24 normal planting season by a cash lessee, the land25 owner shall not be required to sign the transfer au-
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1 thorization. A fall transfer or a transfer after the

2 normal planting season may be made not later than

3 72 hours after the peanuts that are the subject of

4 the transfer are inspected and graded. Fall transfers

5 of quota pounds shall not affect the farm quota his6 tory for the transferring or receiving farm and shall

7 not result in reducing the farm poundage quota on

8 the transferring farm.

9 ‘‘(2) TRANSFERS TO OTHER SELF-OWNED

10 FARMS.—The owner or operator of a farm may

11 transfer all or any part of the farm poundage quota

12 to any other farm owned or controlled by the owner

13 or operator that is in the same county or any other

14 county within the same State and that had a farm

15 poundage quota for the preceding year’s crop, pro16 vided that both the transferring and the receiving

17 farms were under the control of the owner or opera18 tor for at least 3 crop years prior to the crop year

19 in which the farm poundage quota is to be trans20 ferred. Any farm poundage quota transferred under

21 this paragraph shall not result in any reduction in

22 the farm poundage quota for the transferring farm

23 if sufficient acreage is planted on the receiving farm

24 to produce the quota pounds transferred.
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1 ‘‘(3) TRANSFERS IN STATES WITH SMALL

2 QUOTAS.—Notwithstanding paragraph (1) and (2),

3 in the case of any State for which the poundage

4 quota allocated to the State was less than 10,000

5 tons for the preceding year’s crop, all or any part of

6 a farm poundage quota may be transferred by sale

7 or lease or otherwise from a farm in one county to

8 a farm in another county in the same State.

9 ‘‘(4) TRANSFERS BY SALE IN STATES WITH

10 LARGE QUOTAS.—In the case of a State for which

11 the poundage quota allocated to the State was

12 10,000 tons or greater for the previous year, the

13 owner, or operator with permission of the owner, of

14 a farm located in the State for which a farm pound15 age quota has been established under section 358–

16 1 may sell all or any part of the farm poundage

17 quota to any other eligible owner or operator of a

18 farm within the same State. No more than 15 per19 cent of the total poundage quota within a county as

20 of January 1, 1996 may be sold and transferred out21 side of the county during calendar year 1996 under

22 this paragraph. Beginning January 1, 1997, no

23 more than 5 percent of the total poundage quota

24 within a county as of January 1 of a calendar year

25 may be sold and transferred outside of the county
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1 during such calendar year under this paragraph. No

2 more than an aggregate of 30 percent of the total

3 poundage quota within a county may be sold and

4 transferred outside the county under this paragraph.

5 Quota poundage sold and transferred under this

6 paragraph may not be leased or sold to another farm

7 owner or operator within the same State for a period

8 of 5 years following the original transfer to the

9 farm.

10 ‘‘(b) CONDITIONS.—Transfers (including transfer by

11 sale or lease) of farm poundage quotas under this section

12 shall be subject to all of the following conditions:

13 ‘‘(1) LIENHOLDERS.—No transfer of the farm

14 poundage quota from a farm subject to a mortgage

15 or other lien shall be permitted unless the transfer

16 is agreed to by the lienholders, except that no such

17 agreement shall be necessary in the event of all

18 lease, if the operator had the lienholder’s agreement

19 for a previous spring cash lease.

20 ‘‘(2) TILLABLE CROPLAND.—No transfer of the

21 farm poundage quota shall be permitted if the coun22 ty committee established under section 8(b) of the

23 Soil Conservation and Domestic Allotment Act (16

24 U.S.C. 590h(b)) determines that the receiving farm
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1 does not have adequate tillable cropland to produce

2 the farm poundage quota.

3 ‘‘(3) RECORD.—No transfer of the farm pound4 age quota shall be effective until a record thereof is

5 filed with the county committees of the counties

6 from which transferred and to which transferred and

7 the committees determined that the transfer com8 plies with this section.

9 ‘‘(4) OTHER TERMS.—Such other terms and

10 conditions that the Secretary may by regulation pre11 scribe.

12 ‘‘(c) CROPS.—Notwithstanding any other provision of

13 law, this section shall be effective only for the 1996

14 through 2000 crops of peanuts.’’.

15 SEC. 3. MARKETING PENALTIES; DISPOSITION OF ADDI16 TIONAL PEANUTS.

17 Section 358e of the Agricultural Adjustment Act of

18 1938 (7 U.S.C. 1359a) is amended to read as follows:

19 ‘‘SEC. 358e. MARKETING PENALTIES AND DISPOSITION OF

20 ADDITIONAL PEANUTS.

21 ‘‘(a) MARKETING PENALTIES.—

22 ‘‘(1) IN GENERAL.—

23 ‘‘(A) MARKETING PEANUTS IN EXCESS OF

24 QUOTA.—The marketing of any peanuts for do25 mestic edible use in excess of the farm pound-
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1 age quota for the farm on which the peanuts

2 are produced shall be subject to penalty at a

3 rate equal to 140 percent of the support price

4 for quota peanuts for the marketing year in

5 which the marketing occurs. The penalty shall

6 not apply to the marketing of breeder or Foun7 dation seed peanuts grown and marketed by a

8 publicly owned agricultural experiment station

9 (including a State operated seed organization)

10 under such regulations as the Secretary may

11 prescribe.

12 ‘‘(B) MARKETING YEAR.—For purposes of

13 this section, the marketing year for peanuts

14 shall be the 12-month period beginning August

15 1 and ending July 31.

16 ‘‘(C) MARKETING ADDITIONAL PEA17 NUTS.—The marketing of any additional pea18 nuts from a farm shall be subject to the same

19 penalty unless the peanuts, in accordance with

20 regulations established by the Secretary, are—

21 ‘‘(i) placed under loan at the addi22 tional loan rate in effect for the peanuts

23 under section 108B of the Agricultural Act

24 of 1949 and not redeemed by the produc25 ers;
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1 ‘‘(ii) marketed through an area mar2 keting association designated pursuant to

3 section 108B(c)(1) of the Agricultural Act

4 of 1949; or

5 ‘‘(iii) marketed under contracts be6 tween handlers and producers pursuant to

7 subsection (f).

8 ‘‘(2) PAYER.—The penalty shall be paid by the

9 person who buys to otherwise acquires the peanuts

10 from the producer or, if the peanuts are marketed

11 by the producer through an agent, the penalty shall

12 be paid by the agent. The person or agent may de13 duct an amount equivalent to the penalty from the

14 price paid to the producer.

15 ‘‘(3) FAILURE TO COLLECT.—If the person re16 quired to collect the penalty fails to collect the pen17 alty, the person and all persons entitled to share in

18 the peanuts marketed from the farm or the proceeds

19 thereof shall be jointly and severally liable with such

20 persons who failed to collect the penalty for the

21 amount of the penalty.

22 ‘‘(4) APPLICATION OF QUOTA.—Peanuts pro23 duced in a calendar year in which farm poundage

24 quotas are in effect for the marketing year begin25 ning therein shall be subject to the quotas even
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1 though the peanuts are marketed prior to the date

2 on which the marketing year begins.

3 ‘‘(5) FALSE INFORMATION.—If any producer

4 falsely identifies, fails to accurately certify planted

5 acres, or fails to account for the disposition of any

6 peanuts produced on the planted acres, a quantity of

7 peanuts equal to the greater of the farm’s average

8 or actual yield, as determined by the Secretary,

9 times the planted acres, shall be deemed to have

10 been marketed in violation of permissible uses of

11 quota and additional peanuts. Any penalty payable

12 under this paragraph shall be paid and remitted by

13 the producer.

14 ‘‘(6) UNINTENTIONAL VIOLATIONS.—The Sec15 retary shall authorize, under such regulations as the

16 Secretary shall issue, the county committees estab17 lished under section 8(b) of the Soil Conservation

18 and Domestic Allotment Act (16 U.S.C. 590h(b)) to

19 waive or reduce marketing penalties provided for

20 under this subsection in cases which the committees

21 determine that the violations that were the basis of

22 the penalties were unintentional or without knowl23 edge on the part of the parties concerned.

24 ‘‘(7) DE MINIMIS VIOLATIONS.—Errors in

25 weight that do not exceed one-tenth of 1 percent in
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1 the case of any one marketing document shall not be

2 considered to be marketing violations except in cases

3 of fraud or conspiracy.

4 ‘‘(b) USE OF QUOTA AND ADDITIONAL PEANUTS.—

5 ‘‘(1) QUOTA PEANUTS.—Only quota peanuts

6 may be retained for use as seed or for other uses on

7 a farm. When peanuts are so retained, such reten8 tion shall be considered as marketings of quota pea9 nuts, except that the Secretary may exempt from

10 consideration as marketings of quota peanuts seeds

11 of peanuts for the quantity involved that are used to

12 produce peanuts excluded under section 358d(c), are

13 unique strains, and are not commercially available.

14 ‘‘(2) ADDITIONAL PEANUTS.—Additional pea15 nuts shall not be retained for use on a farm and

16 shall not be marketed for domestic edible use, except

17 as provided in subsection (g).

18 ‘‘(3) SEED.—Except as provided in paragraph

19 (1), seed for planting of any peanut acreage in the

20 United States shall be obtained solely from quota

21 peanuts marketed or considered marketed for do22 mestic edible use.

23 ‘‘(c) MARKETING PEANUTS WITH EXCESS QUAN24 TITY, GRADE, OR QUALITY.—On a finding by the Sec25 retary that the peanuts marketed from any crop for do-
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1 mestic edible use by a handler are larger in quantity or

2 higher in grade or quality than the peanuts that could rea3 sonably be produced from the quantity of peanuts having

4 the grade, kernel content, the quality of the quota peanuts

5 acquired by the handler from the crop for the marketing

6 year, the handler shall be subject to a penalty equal to

7 140 percent of the loan level for quota peanuts on the

8 quantity of peanuts that the Secretary determines are in

9 excess of the quantity, grade, or quality of the peanuts

10 that could reasonably have been produced from the pea11 nuts so acquired.

12 ‘‘(d) SUPERVISION OF HANDLERS OF ADDITIONAL

13 PEANUTS.—

14 ‘‘(1) IN GENERAL.—Except as provided in para15 graph (2), the Secretary shall require that the han16 dling and disposal of additional peanuts be super17 vised by agents of the Secretary or by area market18 ing associations designated pursuant to section

19 108B(c)(1) of the Agricultural Act of 1949.

20 ‘‘(2) SUPERVISION BY NONHANDLERS.—

21 ‘‘(A) IN GENERAL.—Supervision of the

22 handling and disposal of additional peanuts by

23 a handler shall not be required under para24 graph (1) if the handler agrees in writing, prior

25 to any handling or disposal of the peanuts, to
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1 comply with regulations that the Secretary shall

2 issue.

3 ‘‘(B) REGULATIONS.—The regulations is4 sued by the Secretary under subparagraph (A)

5 shall include the following provisions:

6 ‘‘(i) TYPES OF EXPORTED OR

7 CRUSHED PEANUTS.—Handlers of shelled

8 or milled peanuts may export or crush pea9 nuts classified by type in all of the follow10 ing quantities:

11 ‘‘(I) SOUND SPLIT KERNEL PEA12 NUTS.—Sound split kernel peanuts

13 purchased by the handler as addi14 tional peanuts to which, under price

15 support loan schedules, a mandated

16 deduction with respect to the price

17 paid to the producer of the peanuts

18 would be applied due to the percent19 age of the sound splits.

20 ‘‘(II) SOUND MATURE KERNEL

21 PEANUTS.—Sound mature kernel pea22 nuts (which term includes sound split

23 kernel peanuts and sound whole ker24 nel peanuts) in an amount equal to

25 the poundage of the peanuts pur-
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1 chased by the handler as additional

2 peanuts, less the total poundage of

3 sound split kernel peanuts described

4 in subclause (I).

5 ‘‘(III) REMAINDER.—The re6 maining quantity of total kernel con7 tent of peanuts purchased by the han8 dler as additional peanuts.

9 ‘‘(ii) DOCUMENTATION.—Handlers

10 shall ensure that any additional peanuts

11 exported or crushed are evidenced by on12 board bills of lading or other appropriate

13 documentation as may be required by the

14 Secretary, or both.

15 ‘‘(iii) LOSS OF PEANUTS.—If a han16 dler suffers a loss of peanuts as a result of

17 fire, flood, or any other condition beyond

18 the control of the handler, the portion of

19 the loss allocated to contracted additional

20 peanuts shall not be greater than the por21 tion of the handler’s total peanut pur22 chases for the year attributable to con23 tracted additional peanuts purchased for

24 export or crushing by the handler during

25 the year.
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1 ‘‘(iv) SHRINKAGE ALLOWANCE.—

2 ‘‘(I) IN GENERAL.—The obliga3 tion of a handler to export or crush

4 peanuts in quantities described in this

5 subparagraph shall be reduced by a

6 shrinkage allowance, to be determined

7 by the Secretary, to reflect actual dol8 lar value shrinkage experienced by

9 handlers in commercial operations, ex10 cept that the allowance shall not be

11 less than 4 percent, except as pro12 vided in subclause (II).

13 ‘‘(II) COMMON INDUSTRY PRAC14 TICES.—The Secretary may provide a

15 lower shrinkage allowance for a han16 dler who fails to comply with the re17 strictions on the use of peanuts, as

18 may be specified by the Commodity

19 Credit Corporation, to take into ac20 count common industry practices.

21 ‘‘(3) ADEQUATE FINANCES AND FACILITIES.—A

22 handler shall submit to the Secretary adequate fi23 nancial guarantees, as well as evidence of adequate

24 facilities and assets, with the facilities under the

25 control and operation of the handler, to ensure the
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1 handler’s compliance with the obligation to export

2 peanuts.

3 ‘‘(4) COMMINGLING OF LIKE PEANUTS.—Quota

4 and additional peanuts of like type and segregation

5 or quality may, under regulations issued by the Sec6 retary, be commingled and exchanged on a dollar

7 value basis to facilitate warehousing, handling, and

8 marketing.

9 ‘‘(5) PENALTY.—

10 ‘‘(A) IN GENERAL.—Except as provided in

11 subparagraph (B), the failure by a handler to

12 comply with regulations issued by the Secretary

13 governing the disposition and handling of addi14 tional peanuts shall subject the handler to a

15 penalty at a rate equal to 140 percent of the

16 loan level for quota peanuts on the quantity of

17 peanuts involved in the violation.

18 ‘‘(B) NONDELIVERY.—A handler shall not

19 be subject to a penalty for failure to export ad20 ditional peanuts if the peanuts were not deliv21 ered to the handler.

22 ‘‘(6) REENTRY OF EXPORTED PEANUTS.—

23 ‘‘(A) PENALTIES.—If any additional pea24 nuts or peanut products manufactured from ad25 ditional peanuts exported by a handler are reen-
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1 tered into the United States in commercial

2 quantities as determined by the Secretary, the

3 importer thereof shall be subject to a penalty at

4 a rate equal to 140 percent of the loan level for

5 quota peanuts on the quantity of peanuts reen6 tered.

7 ‘‘(B) RECORDS.—Each person, firm, or

8 handler who imports peanuts into the United

9 States shall maintain such records and docu10 ments as are required by the Secretary to en11 sure compliance with this subsection.

12 ‘‘(e) SPECIAL EXPORT CREDITS.—

13 ‘‘(1) IN GENERAL.—The Secretary shall, with

14 due regard for the integrity of the peanut program,

15 promulgate regulations that will permit any handler

16 of peanuts who manufactures peanut products from

17 domestic edible peanuts to export the products and

18 receive credit for the fulfillment of export obligations

19 for the peanut content of the products against which

20 the export credits the handler may thereafter apply,

21 up to the amount thereof, equivalent quantities of

22 additional peanuts of the same type acquired by the

23 handler and used in the domestic edible market. The

24 peanuts so acquired for the domestic edible market

25 as provided in this subsection shall be of the same
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1 crop year as the peanuts used in the manufacture of

2 the products so exported.

3 ‘‘(2) CERTIFICATION.—Under such regulations,

4 the Secretary shall require all handlers who are pea5 nut product manufacturers to submit annual certifi6 cations of peanut product content on a product-by7 product basis. Any changes in peanut product for8 mulas as affecting peanut content shall be recorded

9 within 90 days of the changes. The Secretary shall

10 conduct an annual review of the certifications. The

11 Secretary shall pursue all available remedies with re12 spect to persons who fail to comply with this para13 graph.

14 ‘‘(3) RECORDS.—The Secretary shall require

15 handlers who are peanut product manufacturers to

16 maintain and provide such documents as are nec17 essary to ensure compliance with this subsection and

18 to maintain the integrity of the peanut program.

19 ‘‘(f) CONTRACTS FOR PURCHASE OF ADDITIONAL

20 PEANUTS.—

21 ‘‘(1) IN GENERAL.—Handlers may, under such

22 regulations as the Secretary may issue, contract with

23 producers for the purchase of additional peanuts for

24 crushing or export, or both.

25 ‘‘(2) SUBMISSION TO SECRETARY.—
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1 ‘‘(A) CONTRACT DEADLINE.—Any such

2 contract shall be completed and submitted to

3 the Secretary (or if designated by the Sec4 retary, the area marketing association) for ap5 proval not later than September 15 of the year

6 in which the crop is produced.

7 ‘‘(B) EXTENSION OF DEADLINE.—The

8 Secretary may extend the deadline under sub9 paragraph (A) by up to 15 days in response to

10 damaging weather or related condition (as de11 fined in section 112 of the Disaster Assistance

12 Act of 1989 (7 U.S.C. 1421 et seq.)). The Sec13 retary shall announce the extension no later

14 than September 5 of the year in which the crop

15 is produced.

16 ‘‘(3) FORM.—The contract shall be executed on

17 a form prescribed by the Secretary. The form shall

18 require such information as the Secretary deter19 mines appropriate to ensure the proper handling of

20 the additional peanuts, including the identity of the

21 contracting parties, the poundage, and category of

22 the peanuts, the disclosure of any liens, and the in23 tended disposition of the peanuts.

24 ‘‘(4) INFORMATION FOR HANDLING AND PROC25 ESSING ADDITIONAL PEANUTS.—Notwithstanding
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1 any other provision of this section, any person wish2 ing to handle and process additional peanuts as a

3 handler shall submit to the Secretary (or if des4 ignated by the Secretary, the area marketing asso5 ciation), such information as may be required under

6 subsection (d) by such date as prescribed by the Sec7 retary so as to permit final action to be taken on the

8 application by July 1 of each marketing year.

9 ‘‘(5) TERMS.—Each such contract shall contain

10 the final price to be paid by the handler for the pea11 nuts involved and a specific prohibition against the

12 disposition of the peanuts for domestic edible or seed

13 use.

14 ‘‘(6) SUSPENSION OF RESTRICTIONS ON IM15 PORTED PEANUTS.—Notwithstanding any other pro16 vision of this Act, if the President issues a proclama17 tion under section 404(b) of the Uruguay Round

18 Agreements Act expanding the quantity of peanuts

19 subject to the in-quota rate of duty under a tariff20 rate quota, or under section 22 of the Agricultural

21 Adjustment Act (7 U.S.C. 624), reenacted with

22 amendments by the Agricultural Marketing Agree23 ment Act of 1937, temporarily suspending restric24 tions on the importation of peanuts, the Secretary

25 shall, subject to such terms and conditions as the
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1 Secretary may prescribe, permit a handler, with the

2 written consent of the producer, to purchase addi3 tional peanuts from any producer who contracted

4 with the handler and to offer the peanuts for sale

5 for domestic edible use.

6 ‘‘(g) MARKETING OF PEANUTS OWNED OR CON7 TROLLED BY THE COMMODITY CREDIT CORPORATION.—

8 ‘‘(1) IN GENERAL.—Subject to section 407 of

9 the Agricultural Act of 1949 (7 U.S.C. 1427), any

10 peanuts owned or controlled by the Commodity

11 Credit Corporation may be made available for do12 mestic edible use, in accordance with regulations is13 sued by the Secretary, so long as doing so does not

14 result in substantially increased cost to the Com15 modity Credit Corporation. Additional peanuts re16 ceived under loan shall be offered for sale for domes17 tic edible use at prices not less than those required

18 to cover all costs incurred with respect to the pea19 nuts for such items as inspection, warehousing,

20 shrinkage, and other expenses, plus—

21 ‘‘(A) not less than 100 percent of the loan

22 value of quota peanuts if the additional peanuts

23 are sold and paid for during the harvest season

24 on delivery by and with the written consent of

25 the producer;
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1 ‘‘(B) not less than 105 percent of the loan

2 value of quota peanuts if the additional peanuts

3 are sold after delivery by the producer but not

4 later than December 31 of the marketing year;

5 or

6 ‘‘(C) not less than 107 percent of the loan

7 value of quota peanuts if the additional peanuts

8 are sold later than December 31 of the market9 ing year.

10 ‘‘(2) ACCEPTANCE OF BIDS BY AREA MARKET11 ING ASSOCIATIONS.—

12 ‘‘(A) IN GENERAL.—Except as provided in

13 subparagraph (B), for the period from the date

14 additional peanuts are delivered for loan to

15 March 1 of the calendar year following the year

16 in which the additional peanuts were harvested,

17 the area marketing association designated pur18 suant to section 108B(c)(1) of the Agricultural

19 Act of 1949 shall have sole authority to accept

20 or reject lot list bids when the sales price, as

21 determined under this subsection, equals or ex22 ceeds the minimum price at which the Commu23 nity Credit Corporation may sell its stocks of

24 additional peanuts.
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1 ‘‘(B) MODIFICATION.—The area marketing

2 association and the Community Credit Corpora3 tion may agree to modify the authority granted

4 by subparagraph (A) to facilitate the orderly

5 marketing of additional peanuts.

6 ‘‘(3) PRODUCER MARKETING AND EXPENSES.—

7 Notwithstanding any other provision of this Act, the

8 Secretary shall, in any determination required under

9 subsections (a)(2) and (b)(1) of section 108B of the

10 Agricultural Act of 1949, include any additional

11 marketing expenses required by law, excluding the

12 amount of any assessment required under the Omni13 bus Budget Reconciliation Act of 1990.

14 ‘‘(h) ADMINISTRATION.—

15 ‘‘(1) INTEREST.—The person liable for payment

16 or collection of any penalty provided for in this sec17 tion shall be liable also for interest thereon at a rate

18 per annum equal to the rate per annum of interest

19 that was charged the Commodity Credit Corporation

20 by the Treasury of the United States on the date the

21 penalty became due.

22 ‘‘(2) DE MINIMIS QUANTITY.—This section shall

23 not apply to peanuts produced on any farm on which

24 the acreage harvested for nuts is one acre or less if

25 the producers who share in the peanuts produced on
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1 the farm do not share in the peanuts produced on

2 any other farm.

3 ‘‘(3) LIENS.—Until the amount of the penalty

4 provided by this section is paid, a lien on the crop

5 of peanuts with respect to which the penalty is in6 curred, and on any subsequent crop of peanuts sub7 ject to farm poundage quotas in which the person

8 liable for payment of the penalty has an interest,

9 shall be in effect in favor of the United States.

10 ‘‘(4) PENALTIES.—

11 ‘‘(A) PROCEDURES.—Notwithstanding any

12 other provision of law, the liability for and the

13 amount of any penalty assessed under this sec14 tion shall be determined in accordance with

15 such procedures as the Secretary by regulation

16 may prescribe. The facts constituting the basis

17 for determining the liability for or amount of

18 any penalty assessed under this section, when

19 officially determined in conformity with the ap20 plicable regulations prescribed by the Secretary,

21 shall be final and conclusive and shall not be

22 reviewable by any other officer or agency of the

23 Government.

24 ‘‘(B) JUDICIAL REVIEW.—Nothing in this

25 section shall be construed as prohibiting any
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1 court of competent jurisdiction from reviewing

2 any determination made by the Secretary with

3 respect to whether the determination was made

4 in conformity with the applicable law and regu5 lations.

6 ‘‘(C) CIVIL PENALTIES.—All penalties im7 posed under this section shall for all purposes

8 be considered civil penalties.

9 ‘‘(5) REDUCTION OF PENALTIES.—

10 ‘‘(A) IN GENERAL.—Notwithstanding any

11 other provision of law and except as provided in

12 subparagraph (B), the Secretary may reduce

13 the amount of any penalty assessed against

14 handlers under this section by any appropriate

15 amount, including, in an appropriate case,

16 eliminating the penalty entirely, if the Secretary

17 finds that the violation on which the penalty is

18 based was minor or inadvertent, and that the

19 reduction of the penalty will not impair the op20 eration of the peanut program.

21 ‘‘(B) FAILURE TO EXPORT CONTRACTED

22 ADDITIONAL PEANUTS.—The amount of any

23 penalty imposed on a handler under this section

24 that resulted from the failure to export or crush
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1 contracted additional peanuts shall not be re2 duced by the Secretary.

3 ‘‘(i) CROPS.—Notwithstanding any other provision of

4 law, this section shall be effective only for the 1996

5 through 2000 crops of peanuts.’’.

6 SEC. 4. EXTENSION OF EXPERIMENTAL AND RESEARCH

7 PROGRAMS FOR PEANUTS.

8 Subsection 358c(d) of the Agricultural Adjustment

9 Act of 1938 (7 U.S.C. 1358c(d)) is amended by striking

10 ‘‘1991 through 1995’’ and inserting ‘‘1996 through

11 2000’’.

12 SEC. 5. PRICE SUPPORT PROGRAM.

13 Section 108B of the Agricultural Act of 1949 (7

14 U.S.C. 1445c–3) is amended to read as follows:

15 ‘‘SEC. 108B. PRICE SUPPORT PROGRAM FOR PEANUTS.

16 ‘‘(a) QUOTA PEANUTS.—

17 ‘‘(1) IN GENERAL.—The Secretary shall make

18 price support available to producers through loans,

19 purchases, and other operations on quota peanuts

20 for each crop.

21 ‘‘(2) SUPPORT RATES.—The national average

22 quota support rate for each crop of quota peanuts

23 shall be the national average quota support rate for

24 the immediately preceding crop adjusted to reflect

25 any increase or decrease during the calendar year
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1 immediately preceding the marketing year for the

2 crop for which a level of support is being deter3 mined, in the national average cost of peanut pro4 duction, excluding any change in the cost of land,

5 and the cost of any assessments required under sub6 section (g), except that in no event shall the national

7 average quota support rate be increased by more

8 than 5 percent of the national average quota support

9 rate for the preceding crop, nor be decreased by

10 more than 5 percent of the national average quota

11 support rate for the preceding crop.

12 ‘‘(3) INSPECTION, HANDLING, OR STORAGE.—

13 The levels of support so announced shall not be re14 duced by any deductions for inspection, handling, or

15 storage.

16 ‘‘(4) LOCATION AND OTHER FACTORS.—The

17 Secretary may make adjustments for location of pea18 nuts and such other factors as are authorized by

19 section 403.

20 ‘‘(5) ANNOUNCEMENT.—The Secretary shall

21 announce the level of support for quota peanuts of

22 each crop not later than February 15 preceding the

23 marketing year for the crop for which the level of

24 support is being determined.

25 ‘‘(b) ADDITIONAL PEANUTS.—
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1 ‘‘(1) IN GENERAL.—The Secretary shall make

2 price support available to producers through loans,

3 purchases, or other operations on additional peanuts

4 from each crop at such levels as the Secretary finds

5 appropriate, taking into consideration the demand

6 for peanut oil and peanut meal, expected prices of

7 other vegetable oils and protein meals, and the de8 mand for peanuts in foreign markets, except that

9 the Secretary shall set the support rate on additional

10 peanuts at a level estimated by the Secretary to en11 sure that there are no losses to the Commodity

12 Credit Corporation on the sale or disposal of the

13 peanuts.

14 ‘‘(2) ANNOUNCEMENT.—The Secretary shall

15 announce the level of support for additional peanuts

16 of each crop not later than February 15 preceding

17 the marketing year for the crop for which the level

18 of support is being determined.

19 ‘‘(c) AREA MARKETING ASSOCIATIONS.—

20 ‘‘(1) WAREHOUSE STORAGE LOANS.—

21 ‘‘(A) IN GENERAL.—In carrying out sub22 sections (a) and (b), the Secretary shall make

23 warehouse storage loans available in each of the

24 three producing areas (described in section

25 1446.95 of title 7 of the Code of Federal Regu-
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1 lations (January 1, 1989)) to a designated area

2 marketing association of peanut producers that

3 is selected and approved by the Secretary and

4 that is operated primarily for the purpose of

5 conducting the loan activities. The Secretary

6 may not make warehouse storage loans avail7 able to any cooperative that is engaged in oper8 ations or activities concerning peanuts other

9 than those operations and activities specified in

10 this section and sections 358d and 358e of the

11 Agricultural Adjustment Act of 1938.

12 ‘‘(B) ADMINISTRATIVE AND SUPERVISORY

13 ACTIVITIES.—The area marketing associations

14 shall be used in administrative and supervisory

15 activities relating to price support and market16 ing activities under this section and sections

17 358d and 358e of the Agricultural Adjustment

18 Act of 1938.

19 ‘‘(C) ASSOCIATION COSTS.—Loans made to

20 the association under this paragraph shall in21 clude, in addition to the price support value of

22 the peanuts, such costs as the area marketing

23 association reasonably may incur in carrying

24 out its responsibilities, operations, and activities
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1 under this section and sections 358d and 358e

2 of the Agricultural Adjustment Act of 1938.

3 ‘‘(2) POOLS FOR QUOTA AND ADDITIONAL PEA4 NUTS.—

5 ‘‘(A) IN GENERAL.—The Secretary shall

6 require that each area marketing association es7 tablish pools and maintain complete and accu8 rate records by area and segregation for quota

9 peanuts handled under loan and for additional

10 peanuts placed under loan, except that separate

11 pools shall be established for Valencia peanuts

12 produced in New Mexico. Peanuts physically

13 produced outside the State of New Mexico shall

14 not be eligible for entry into or participation in

15 the New Mexico pools. Bright hull and dark

16 hull Valencia peanuts shall be considered as

17 separate types for the purpose of establishing

18 the pools.

19 ‘‘(B) NET GAINS.—Net gains on peanuts

20 in each pool, unless otherwise approved by the

21 Secretary, shall be distributed only to producers

22 who placed peanuts in the pool shall be distrib23 uted in proportion to the value of the peanuts

24 placed in the pool by each producer. Net gains
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1 for peanuts in each pool shall consist of the fol2 lowing:

3 ‘‘(i) QUOTA PEANUTS.—For quota

4 peanuts, the net gains over and above the

5 loan indebtedness and other costs or losses

6 incurred on peanuts placed in the pool plus

7 an amount from all additional pool gains

8 equal to any loss on disposition of all pea9 nuts in the pool for quota peanuts.

10 ‘‘(ii) ADDITIONAL PEANUTS.—For ad11 ditional peanuts, the net gains over and

12 above the loan indebtedness and other

13 costs or losses incurred on peanuts placed

14 in the pool for additional peanuts less any

15 amount allocated to offset any loss on the

16 pool for quota peanuts as provided in

17 clause (i).

18 ‘‘(d) LOSSES.—Notwithstanding any other provision

19 of this section:

20 ‘‘(1) QUOTA PEANUTS PLACED UNDER LOAN.—

21 Any distribution of net gains on additional peanuts

22 (other than net gains on additional peanuts in sepa23 rate type pools established under subsection

24 (c)(2)(A) for Valencia peanuts produced in New

25 Mexico) shall be first reduced to the extent of any
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1 loss by the Commodity Credit Corporation on quota

2 peanuts placed under loan.

3 ‘‘(2) QUOTA LOAN POOLS.—

4 ‘‘(A) TRANSFERS FROM ADDITIONAL LOAN

5 POOLS.—The proceeds due any producer from

6 any pool shall be reduced by the amount of any

7 loss that is incurred with respect to peanuts

8 transferred from an additional loan pool to a

9 quota loan pool by such producer under section

10 358–1(b)(8) of the Agricultural Adjustment Act

11 of 1938.

12 ‘‘(B) OTHER LOSSES.—Losses in area

13 quota pools shall be offset by reducing the gains

14 of any producer in such pool by the amount of

15 pool gains attributed to the same producer from

16 the sale of additional peanuts for export and

17 domestic edible use.

18 ‘‘(e) DISAPPROVAL OF QUOTAS.—Notwithstanding

19 any other provision of law, no price support may be made

20 available by the Secretary for any crop of peanuts with

21 respect to which poundage quotas have been disapproved

22 by producers, as provided for in section 358–1(d) of the

23 Agricultural Adjustment Act of 1938.

24 ‘‘(f) QUALITY IMPROVEMENT.—
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1 ‘‘(1) PRICE SUPPORT PEANUTS.—With respect

2 to peanuts under price support loan, the Secretary

3 shall—

4 ‘‘(A) promote the crushing of peanuts at a

5 greater risk of deterioration before peanuts of a

6 lesser risk of deterioration;

7 ‘‘(B) ensure that all Commodity Credit

8 Corporation loan stocks of peanuts sold for do9 mestic edible use must be shown to have been

10 officially inspected by licensed Department of

11 Agriculture inspectors both as farmer stock and

12 shelled or cleaned in-shell peanuts;

13 ‘‘(C) continue to endeavor to operate the

14 peanut price support program so as to improve

15 the quality of domestic peanuts and ensure the

16 coordination of activities under the Peanut Ad17 ministrative Committee established under Mar18 keting Agreement No. 146, regulating the qual19 ity of domestically produced peanuts (under the

20 Agricultural Marketing Agreement Act of 1937

21 (7 U.S.C. 601 et seq.)); and

22 ‘‘(D) ensure that any changes made in the

23 price support program as a result of this sub24 section requiring additional production or han25 dling at the farm level shall be reflected as an
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1 upward adjustment in the Department of Agri2 culture loan schedule.

3 ‘‘(2) EXPORTS AND OTHER PEANUTS.—The

4 Secretary shall require that all peanuts, including

5 peanuts imported into the United States, meet all

6 U.S. quality standards under Marketing Agreement

7 No. 146 and that importers of such peanuts fully

8 comply with inspection, handling, storage and proc9 essing requirements implemented under Marketing

10 Agreement No. 146. The Secretary shall ensure that

11 peanuts produced for the export market meet qual12 ity, inspection, handling, storage and processing re13 quirements under Marketing Agreement No. 146.

14 ‘‘(g) MARKETING ASSESSMENT.—

15 ‘‘(1) IN GENERAL.—The Secretary shall pro16 vide, by regulation, for a nonrefundable marketing

17 assessment applicable to each crop of domestically18 grown peanuts and peanuts produced outside the

19 United States. The assessment shall be made in ac20 cordance with this subsection and shall be on a per

21 pound basis in an amount equal to 1.2 percent of

22 the applicable support rate under this subsection.

23 ‘‘(2) FIRST PURCHASERS.—
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1 ‘‘(A) IN GENERAL.—Except as provided

2 under paragraphs (4) and (5), the first pur3 chaser of peanuts shall—

4 ‘‘(i) collect from the producer a mar5 keting assessment equal to the quantity of

6 peanuts acquired multiplied by .65 percent

7 of the applicable national average support

8 rate;

9 ‘‘(ii) pay, in addition to the amount

10 collected under clause (i), a marketing as11 sessment in an amount equal to the quan12 tity of peanuts acquired multiplied by .55

13 percent of the applicable national average

14 support rate; and

15 ‘‘(iii) remit the amounts required

16 under clauses (i) and (ii) to the Commod17 ity Credit Corporation in a manner speci18 fied by the Secretary.

19 ‘‘(B) DEFINITION.—For purposes of this

20 subsection, the term ‘first purchaser’ means a

21 person acquiring peanuts from a producer, ex22 cept that in the case of peanuts forfeited by a

23 producer to the Commodity Credit Corporation,

24 such term means the person acquiring the pea25 nuts from the Commodity Credit Corporation.
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1 ‘‘(3) OTHER PEANUTS.—Each importer of pea2 nuts for domestic edible use produced outside of the

3 United States shall remit to the Commodity Credit

4 Corporation a nonrefundable marketing assessment

5 in an amount equal to the product obtained by mul6 tiplying the number of pounds of peanuts imported

7 by the importer by 1.2 percent of the national aver8 age support rate for domestic edible peanuts.

9 ‘‘(4) OTHER PRIVATE MARKETINGS.—In the

10 case of a private marketing by a producer directly

11 to a consumer through a retail or wholesale outlet

12 or in the case of a marketing by the producer out13 side of the continental United States, the producer

14 shall be responsible for the full amount of the as15 sessment and shall remit the assessment by such

16 time as is specified by the Secretary.

17 ‘‘(5) LOAN PEANUTS.—In the case of peanuts

18 that are pledged as collateral for a price support

19 loan made under this section, one-half of the assess20 ment shall be deducted from the proceeds of the

21 loan. The remainder of the assessment shall be paid

22 by the first purchaser of the peanuts. For purposes

23 of computing net gains on peanuts under this sec24 tion, the reduction in loan proceeds shall be treated

25 as having been paid to the producer.
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1 ‘‘(6) PENALTIES.—If any person fails to collect

2 or remit an assessment required by this subsection

3 or fails to comply with such requirements for record4 keeping or otherwise as are required by the Sec5 retary to carry out this subsection, the person shall

6 be liable to the Secretary for a civil penalty up to

7 an amount determined by multiplying—

8 ‘‘(A) the quantity of peanuts involved in

9 the violation; by

10 ‘‘(B) the national average quota peanut

11 price support level for the applicable crop year.

12 ‘‘(7) ENFORCEMENT.—The Secretary may en13 force this subsection in the courts of the United

14 States.

15 ‘‘(h) CROPS.—Notwithstanding any other provision

16 of law, this section shall be effective only for the 1996

17 through 2000 crops of peanuts.’’.

18 SEC. 6. REPORTS AND RECORDS.

19 Effective only for the 1996 through 2000 crops of

20 peanuts, the first sentence of section 373(a) of the Agri21 cultural Adjustment Act of 1938 (7 U.S.C. 1373(a)) is

22 amended by inserting before ‘‘all brokers and dealers in

23 peanuts’’ the following: ‘‘all producers engaged in the pro24 duction of peanuts,’’.
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1 SEC. 7. SUSPENSION OF CERTAIN PRICE SUPPORT PROVI2 SIONS.

3 Section 101 of the Agricultural Act of 1949 (7 U.S.C.

4 1441) shall not be applicable to the 1996 through 2000

5 crops of peanuts.

6 SEC. 8. REGULATIONS.

7 The Secretary of Agriculture shall issue such regula8 tions as are necessary to carry out this Act and the

9 amendments made by this Act. In issuing the regulations,

10 the Secretary—

11 (1) is encouraged to comply with subchapter II

12 of chapter 5 of title 5, United States Code;

13 (2) shall provide public notice through the Fed14 eral Register of any such proposed regulations; and

15 (3) shall allow adequate time for written public

16 comment prior to the formulation and issuance of

17 any final regulations.

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